Chrysler Group International S-4/A Registration of securities issued in business combination transactions (amended)

As filed with the Securities and Exchange Commission on April 1, 2014.

Registration No. 333-194654

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Amendment No. 1

to

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Chrysler Group LLC

*And the Additional Registrants listed below

(Exact name of registrant as specified in its charter)

Delaware	3711	27-0187394
(State or other jurisdiction of incorporation or organization)	(Primary standard industrial classification code number)	(I.R.S. Employer Identification Number)

1000 Chrysler Drive

Auburn Hills, Michigan 48326

(248) 512-2950

(Address, including zip code, and telephone number, including area code, of Registrants’ principal executive offices)

Marjorie H. Loeb, Esq.

Senior Vice President, General Counsel and Secretary

Chrysler Group LLC

1000 Chrysler Drive

Auburn Hills, Michigan 48326

(248) 512-2950

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Scott D. Miller, Esq.

Sullivan & Cromwell LLP

125 Broad Street

New York, New York 10004

(212) 558-4000

* The companies listed on the next page are also included in this Form S-4 Registration Statement as additional Registrants.

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as practicable after the effective date of this registration statement.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, please check the following box and list the Securities Act of 1933 registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act of 1933, check the following box and list the Securities Act of 1933 registration statement number of the earlier effective registration statement for the same offering.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	þ  (Do not check if a smaller reporting company)	Smaller Reporting Company	¨

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  ¨

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)  ¨

The Registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrants shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

ADDITIONAL REGISTRANTS

Exact Name of Additional Registrants*	Jurisdiction of Formation	IRS Employer Identification No.
CG Co-Issuer Inc.	DE	45-2114295
Autodie LLC	DE	20-5831121
Chrysler Group International LLC	DE	27-0197564
Chrysler Group International Services LLC	DE	27-0197659
Chrysler Group Realty Company LLC	DE	27-0197744
Chrysler Group Service Contracts LLC	DE	27-0992378
Chrysler Group Transport LLC	DE	27-0197833
Global Engine Manufacturing Alliance LLC	DE	20-0232860

* The address for each of the additional Registrants is c/o Chrysler Group LLC, 1000 Chrysler Drive, Auburn Hills, Michigan, 48326. The primary standard industrial classification number for each of the additional Registrants is 3711.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION. DATED APRIL 1, 2014.

PROSPECTUS

CHRYSLER GROUP LLC

Offers to Exchange

up to $1,375,000,000 aggregate principal amount of new 8% Secured Senior Notes due 2019

registered under the Securities Act of 1933, for any and all of our outstanding additional 8% Secured Senior Notes due 2019 issued in February 2014, and

up to $1,380,000,000 aggregate principal amount of new 8  ¹⁄₄% Secured Senior Notes due 2021 registered under the Securities Act of 1933, for any and all of our outstanding additional 8  ¹⁄₄%

Secured Senior Notes due 2021 issued in February 2014

We are offering to exchange, upon the terms and subject to the conditions set forth in this prospectus and the accompanying letter of transmittal, our new 8% Secured Senior Notes due 2019, which we refer to as the 2019 Notes, for all of our outstanding additional 8% Secured Senior Notes due 2019 issued on February 7, 2014, which we refer to as the old 2019 notes, and our new 8  ¹⁄₄% Secured Senior Notes due 2021, which we refer to as the 2021 Notes, for all of our outstanding additional 8  ¹⁄₄% Secured Senior Notes due 2021 issued on February 7, 2014, which we refer to as the old 2021 notes. We refer to old 2019 notes and the old 2021 notes together as the old notes, and the 2019 Notes and the 2021 Notes together as the Notes. The old notes were offered as additional notes under an indenture, as supplemented, pursuant to which we and CG Co-Issuer Inc. issued in May 2011 $1,500,000,000 in aggregate principal amount of 8% Secured Senior Notes due 2019, or the Existing 2019 Notes, and $1,700,000,000 in aggregate principal amount of 8  ¹⁄₄% Secured Senior Notes due 2021, or the Existing 2021 Notes and, together with the Existing 2019 Notes, the Existing Notes.

Material Terms of the Exchange Offers

• The exchange offers will expire at 5:00 p.m. New York City time, on             , 2014, unless extended.

• You will receive an equal principal amount of 2019 Notes for all old 2019 notes and an equal principal amount of 2021 Notes for all old 2021 notes, in each case that you validly tender and do not validly withdraw.

• The form and terms of the 2019 Notes and the 2021 Notes will be identical in all material respects to the old 2019 notes and old 2021 notes, respectively, that we issued on February 7, 2014, except the Notes will not contain restrictions on transfer, will bear different CUSIP numbers and will not entitle their holders to certain registration rights relating to the old notes.

• Following the completion of the exchange offers, the Notes will be entitled to the benefits of the indenture and will have the same CUSIP numbers as the corresponding series of Existing Notes registered under the Securities Act of 1933 and will be fungible with such series of Existing Notes.

• The exchange should not be a taxable exchange for United States federal income tax purposes.

• There has been no public market for the old notes and we cannot assure you that any public market for the Notes will develop. We do not intend to list the Notes on any securities exchange.

• If you fail to tender your old notes for the Notes, you will continue to hold unregistered securities and it may be difficult for you to transfer them.

Investing in the Notes involves risks. You should read carefully theRisk Factors beginning on page 14 of this prospectus before participating in the exchange offers.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is                 , 2014.

Each broker-dealer that receives Notes for its own account pursuant to the exchange offers must acknowledge that it will deliver a prospectus in connection with any resale of such Notes. The letter of transmittal accompanying this prospectus states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act of 1933. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Notes received in exchange for old notes where such old notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of up to 180 days of the effectiveness of the exchange offer registration statement, we will make this prospectus available to any broker-dealer for use in connection with any such resale.

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We are responsible for the information contained in this prospectus. We have not authorized anyone to give you any other information, and take no responsibility for any other information that others may give you. We are offering to sell the Notes only in places where offers and sales are permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front cover of this prospectus.

TABLE OF CONTENTS

Page

Industry Data  iii

Presentation of Results  iii

Disclosure Regarding Forward-Looking Statements  iv

Summary  1

Risk Factors  14

The Exchange Offers  47

Use of Proceeds  55

Selected Historical Consolidated Financial and Other Data   56

Management’s Discussion and Analysis of Financial Condition and Results of Operations  59

Business  112

Management  138

Executive Compensation  148

Security Ownership of Certain Beneficial Owners and Management  175

Certain Relationships and Related Party Transactions  176

Description of Other Indebtedness  182

Description of the Notes  193

Book-Entry, Delivery and Form  261

Registration Rights  264

Material U.S. Federal Income Tax Considerations  266

Plan of Distribution  271

Validity of the Notes  273

Experts  273

Where You Can Find More Information  274

Index to Consolidated Financial Statements  F-1

This prospectus contains summaries of the material terms of certain documents and refers you to certain documents that we have filed with the Securities and Exchange Commission, or the SEC. SeeWhere You Can Find More Information. Copies of these documents, except for certain exhibits and schedules, will be made available to you without charge upon written or oral request to:

Chrysler Group LLC

Attn: Investor Relations

1000 Chrysler Drive

Auburn Hills, Michigan 48326

(248) 512-2950

In order to obtain timely delivery of such materials, you must request information from us no later than five business days prior to             , 2014, the date you must make your investment decision.

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INDUSTRY DATA

In this prospectus, we include and refer to industry and market data obtained or derived from internal surveys, market research, publicly available information and industry publications. Industry publications and surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of included information. Although we believe that this information is reliable, we have not independently verified the data from third-party sources. Similarly, while we believe our internal estimates with respect to our industry are reliable, our estimates have not been verified by any independent sources. While we believe the industry data presented in this prospectus are reliable, our estimates, in particular as they relate to market share and our future expectations, involve risks and uncertainties and are subject to change based on various factors, including those discussed under the captionRisk Factors.

In this prospectus, we refer to various different vehicle segments, including the A (mini), B (small), C (compact), D (mid-size) and E (full-size) segments. We derive these segments from industry practice and custom, although there is no official codification of vehicle segments in North America.

PRESENTATION OF RESULTS

As used in this prospectus, all references to the Company, Chrysler Group and any results of operations (i) on and after June 10, 2009 refer only to Chrysler Group LLC and (ii) for the period from January 1, 2009 through June 9, 2009 refer only to Old Carco LLC (f/k/a Chrysler LLC).

CG Co-Issuer Inc., a Delaware corporation and 100 percent owned subsidiary of Chrysler Group LLC, was formed in May 2011 as a special purpose finance subsidiary to facilitate the issuance of the Existing Notes.

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DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that reflect our current views about future events. We use the words “anticipate,” “assume,” “believe,” “estimate,” “expect,” “will,” “intend,” “may,” “plan,” “project,” “should,” “could,” “seek,” “designed,” “potential,” “forecast,” “target,” “objective,” “goal,” or the negatives of such terms or other similar expressions. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These risks and other factors include those listed underRisk Factors and elsewhere in this prospectus. These factors include, but are not limited to:

• our continued ability to reach certain minimum vehicle sales volumes to maintain profitability and appropriate levels of cash flow;

• our ability to regularly introduce new or significantly refreshed vehicles that appeal to a wide base of consumers and to respond to changing consumer preferences, quality demands, economic conditions, and government regulations;

• an increase in unemployment levels, erosion in current economic conditions or decrease in consumer confidence, especially in North America, where we sell most of our vehicles;

• our dependence on our parent, Fiat S.p.A., or Fiat;

• our ability to control costs and implement cost reduction and productivity improvement initiatives;

• lengthy product development cycles and our inability to adequately forecast demand for our vehicles which may lead to inefficient use of our production capacity;

• potential conflicts of interest resulting from certain of our executive officers serving in similar roles for Fiat or its current or former affiliates;

• our ability to increase vehicle sales outside of North America;

• competitive pressures that may limit our ability to reduce sales incentives, achieve better pricing and grow our profitability;

• the potential inability of consumers and our dealers to obtain affordably priced financing on a timely basis due to our lack of a captive finance company, and our ongoing transition to a new private-label financing provider;

• the impact of vehicle defects and/or product recalls (including product liability claims);

• disruption of production or delivery of new vehicles due to shortages of materials, including supply disruptions resulting from natural disasters, labor strikes or supplier insolvencies;

• changes and fluctuations in the prices of raw materials, parts and components;

• the impact of the decline in general economic and industry conditions in Europe on our European suppliers;

• changes in foreign currency exchange rates, commodity prices and interest rates;

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• our substantial indebtedness and limitations on our liquidity that may limit our ability to execute our business plan;

• changes in laws, regulations and government policies, particularly those relating to vehicle emissions, fuel economy and safety; and

• interruptions to our business operations caused by information technology systems failures arising from our transition to new, enterprise-wide software systems or from potential cyber security incidents.

If any of these risks and uncertainties materialize, or if the assumptions underlying any of our forward-looking statements prove incorrect, then our actual results, level of activity, performance or achievements may be materially different from those we express or imply by such statements. The risks described in theRisk Factors section in this prospectus are not exhaustive. Other sections of this prospectus describe additional factors that could adversely affect our business, financial condition or results of operations. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time and we cannot predict all such risk factors, nor can we assess the impact of all such risks on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those implied by any forward-looking statements. In addition, any forward-looking statements are based on the assumption that the Company maintains its status as a partnership for U.S. federal and state income tax purposes and do not consider the impact of a potential conversion of the Company into a corporate tax paying entity. We do not intend, or assume any obligation, to update these forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the cautionary statements referred to above and included elsewhere in this prospectus.

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SUMMARY

In this prospectus, unless otherwise specified, the terms “we,” “our,” “us,” “Chrysler Group” and the “Company” refer to Chrysler Group LLC and its consolidated subsidiaries, or any one or more of them, as the context may require, “Old Carco” refers to Old Carco LLC f/k/a Chrysler LLC and its consolidated subsidiaries, or any one or more of them, as the context may require, and “Fiat” refers to Fiat S.p.A., a corporation organized under the laws of Italy, and its consolidated subsidiaries, or any one or more of them, as the context may require. This summary highlights selected information contained in greater detail elsewhere in this prospectus. This summary may not contain all of the information that you should consider before participating in the exchange offers. You should carefully read the entire prospectus, including the sections under the headingsRisk Factors and Disclosure Regarding Forward-Looking Statements.

CHRYSLER GROUP LLC

Our Company

We design, engineer, manufacture, distribute and sell automobiles, which include passenger cars, utility vehicles (including sport utility and crossover vehicles), minivans, trucks and commercial vans, under the Chrysler, Jeep, Dodge and Ram brands, as well as the SRT performance vehicle designation, and we sell our authentic service parts and accessories under the Mopar brand. We also sell separately-priced service contracts to customers and provide contract manufacturing services to other vehicle manufacturers, primarily Fiat. We are 100 percent owned by Fiat as of January 21, 2014. As part of our industrial alliance with Fiat, or the Fiat-Chrysler Alliance, we also manufacture certain Fiat-brand vehicles in Mexico, which are distributed by us throughout North America and select markets and sold to Fiat for distribution in other select markets. In addition, Fiat manufactures certain Fiat-brand vehicles for us, which we sell throughout North America. We sell our products through a network of approximately 2,600 dealers in the U.S. and through distributors and dealers around the world. Over the past four years, we have transformed our business through renewed brand focus, a streamlined distribution network, an improved cost structure, new management and dedication to designing and building a broadened portfolio of high quality vehicles. We believe that we have established a clear strategy for each of our brands and are reshaping our product lineup in a way that enhances our brands to be highly differentiated and responsive to consumer preferences. As part of this strategy, we have introduced more than 25 new or significantly refreshed vehicles since we began operations in mid-2009. Our vehicles and service parts and accessories are sold primarily in North America.

The Refinancing Transactions and Exchange Offers

On February 7, 2014, we completed the offering of $1.375 billion aggregate principal amount of old 2019 notes and $1.380 billion aggregate principal amount of old 2021 notes in a transaction exempt from the registration requirements under the Securities Act of 1933, as amended, or the Securities Act. We used the proceeds from that offering, together with an additional $250 million incremental term loan under our amended and restated credit agreement, or the Senior Credit Agreement, dated as of June 21, 2013, as amended from time to time, and a $1.750 billion term loan, or Term Loan Credit Facility, under a new term loan credit agreement, or the Term Loan Credit Agreement, described under the headingDescription of Other Indebtedness —Senior Credit Facilities, to repay all amounts outstanding under a senior unsecured note that we issued on June 10, 2009 to the UAW Retiree Medical Benefits Trust, or the VEBA Trust Note, at a redemption price (including accrued but unpaid interest) of approximately $5.0 billion.

The $250 million incremental term loan was issued under our existing tranche B term loan facility maturing on May 24, 2017, or collectively, the Tranche B Term Loan. We have not drawn on our revolving credit facility maturing on May 24, 2016, or Revolving Facility. We refer to the Tranche B Term Loan and the Revolving Facility as the Senior Credit Facilities.

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In connection with the offering of the old notes, we entered into a registration rights agreement, dated as of February 7, 2014, with the initial purchasers of the old notes, or the Registration Rights Agreement. In the Registration Rights Agreement, we agreed to offer the Notes, which will be registered under the Securities Act, in exchange for the old notes. The exchange offers are intended to satisfy our obligations under the Registration Rights Agreement.

Additional Information

Chrysler Group is a Delaware limited liability company and CG Co-Issuer Inc., or Co-Issuer, is a Delaware corporation that was formed in 2011 for purposes of issuing the Existing Notes. Our principal executive offices are located at 1000 Chrysler Drive, Auburn Hills, Michigan 48326. Our phone number at this address is (248) 512-2950 and our corporate website is www.chryslergroupllc.com. We do not incorporate information available on, or accessible through, our corporate website into this prospectus, and you should not consider it part of this prospectus.

Risk Factors

Investing in the Notes involves substantial risks. We face risks in operating our business, including risks that may prevent us from achieving our business objectives or that may adversely affect our business, financial condition and operating results. Before participating in the exchange offers, you should carefully consider all of the information in this prospectus, including matters set forth in the section entitledRisk Factors beginning on page 14.

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The Exchange Offers

The summary below describes the principal terms of the exchange offers. Some of the terms and conditions described below are subject to important limitations and restrictions. You should carefully reviewThe Exchange Offers section of this prospectus, which contains a more detailed description of the terms and conditions of the exchange offers.

The Exchange Offers The exchange offers relate to the exchange of:

• up to $1,375,000,000 aggregate principal amount of additional outstanding 8% Secured Senior Notes due 2019 issued on February 7, 2014, for an equal aggregate principal amount of 2019 Notes; and

• up to $1,380,000,000 aggregate principal amount of additional outstanding 8 ¹⁄₄% Secured Senior Notes due 2021 issued on February 7, 2014, for an equal aggregate principal amount of 2021 Notes.

We will exchange all outstanding old notes issued on February 7, 2014 that are validly tendered and not validly withdrawn. However, you may only exchange old notes in minimum denominations of $200,000 and integral multiples of $1,000 in excess thereof.

The form and terms of the Notes will be identical in all material respects to the form and terms of the corresponding outstanding old notes, except that the Notes will not contain restrictions on transfer, will bear different CUSIP numbers and will not entitle their holders to certain registration rights relating to the old notes.

The old notes were offered as additional notes under the indenture, as supplemented, pursuant to which the Issuers (as defined herein) issued the Existing Notes. Following the completion of the exchange offers, the Notes will have the same CUSIP numbers as the corresponding series of Existing Notes registered under the Securities Act of 1933 and will be fungible with the corresponding series of Existing Notes.

Resale of the Notes Based on interpretations by the staff of the SEC set forth in no-action letters issued to other parties, we believe that you may offer for resale, resell and otherwise transfer your Notes without compliance with the registration and prospectus delivery provisions of the Securities Act if you are not our affiliate and you acquire the Notes issued in the exchange offers in the ordinary course.

You must also represent to us that you are not participating, do not intend to participate, and have no arrangement or understanding with any person to participate, in the

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distribution of the Notes we issue to you in the exchange offers.

Each broker-dealer that receives Notes in the exchange offers for its own account in exchange for old notes that it acquired as a result of market-making or other trading activities must acknowledge that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of the Notes issued in the exchange offers. You may not participate in the exchange offers if you are a broker-dealer who purchased such outstanding old notes directly from us for resale pursuant to Rule 144A or any other available exemption under the Securities Act.

Expiration Date The exchange offers will expire at 5:00 p.m., New York City time, on              , 2014, unless we decide to extend the expiration date of an exchange offer. We may extend the expiration date of either exchange offer for any reason, and we may extend the expiration date of one exchange offer without extending the expiration date of the other exchange offer. The exchange offers are not conditioned upon each other, and we may withdraw, extend or modify the terms of one exchange offer without withdrawing, extending or modifying the terms of the other exchange offer in our sole discretion. If we fail to consummate an exchange offer, you will have certain rights against us with respect to the series of old notes for which the exchange offer has been suspended under the Registration Rights Agreement we entered into as part of the offering of the old notes.

Special Procedures For Beneficial Owners If you are the beneficial owner of old notes and you registered your old notes in the name of a broker or other institution, and you wish to participate in the exchange offers, you should promptly contact the person in whose name you registered your old notes and instruct that person to tender the old notes on your behalf. If you wish to tender on your own behalf, you must, prior to completing and executing the letter of transmittal and delivering your outstanding old notes, either make appropriate arrangements to register ownership of the outstanding old notes in your name or obtain a properly completed bond power from the registered holder. The transfer of record ownership may take considerable time.

Guaranteed Delivery Procedures If you wish to tender your old notes and time will not permit your required documents to reach the exchange agent by the expiration date, or you cannot complete the procedure for book-entry transfer on time or you cannot deliver your certificates for registered old notes on time, you may tender your old notes pursuant to the procedures described in this prospectus under the headingThe Exchange Offers —How to

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Use the Guaranteed Delivery Procedures If You Will Not Have Enough Time to Send All Documents to Us.

Withdrawal Rights You may withdraw the tender of your old notes at any time prior to the expiration date.

Certain U.S. Federal Income Tax Considerations An exchange of old notes for Notes should not be subject to United States federal income tax. SeeCertain U.S. Federal Income Tax Considerations.

Use of Proceeds We will not receive any proceeds from the issuance of Notes pursuant to the exchange offers. Old notes that are validly tendered and exchanged will be retired and canceled. We will pay all expenses incidental to the exchange offers.

Exchange Agent You can reach the Exchange Agent, Citibank, N.A. at 480 Washington Boulevard, 30th Floor, Jersey City, New Jersey 07310, Attn: Citibank Agency & Trust. For more information with respect to the exchange offers, you may call the Exchange Agent at (973) 461-7169; the fax number for the Exchange Agent is (973) 461-7191 or (973) 461-7192 (for eligible institutions only).

The Notes

The summary below describes the principal terms of the Notes. Some of the terms and conditions described below are subject to important limitations and exceptions. You should carefully review theDescription of the Notes section of this prospectus, which contains a more detailed description of the terms and conditions of the Notes. For purposes of the summary below, the terms “we,” “our,” “us,” and “Chrysler Group” refer only to Chrysler Group LLC and not to any of its subsidiaries.

Issuers Chrysler Group LLC, a Delaware limited liability company, and CG Co-Issuer Inc., a Delaware corporation and 100 percent owned subsidiary of Chrysler Group LLC, or the Co-Issuer. The Notes will be the joint and several obligations of the Issuers. SeeDescription of the Notes —General.

Notes Offered $1,375,000,000 aggregate principal amount of 2019 Notes.

$1,380,000,000 aggregate principal amount of 2021 Notes.

Maturity Date June 15, 2019 for the 2019 Notes.

June 15, 2021 for the 2021 Notes.

Interest Payment Dates June 15 and December 15 of each year, commencing June 15, 2014.

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Guarantees by our Subsidiaries The Notes will be fully and unconditionally guaranteed on a senior secured junior-priority basis by each of our existing and future domestic Restricted Subsidiaries (as defined herein) that guarantee the Senior Credit Facilities and the Term Loan Credit Facility, as well as certain other future domestic Restricted Subsidiaries. SeeDescription of the Notes —Certain Covenants in the Indenture —Future Guarantors.

Ranking The Notes will be the secured senior obligations of the Issuers on a joint and several basis and:

• will be senior in right of payment to any indebtedness of the Issuers which is by its terms subordinated in right of payment to the Notes;

• will rankpari passu in right of payment with respect to all existing and future unsubordinated indebtedness of the Issuers, including the Senior Credit Facilities and the Term Loan Credit Facility and certain additional indebtedness permitted under the Indenture (as defined herein);

• will be effectively junior to any obligations of the Issuers that are either (i) secured by a lien on the Collateral (as defined herein) that is senior or prior to the liens securing the Notes, including the Liens (as defined herein) securing the Senior Credit Facilities and the Term Loan Credit Facility, and to other Permitted Liens (as defined herein), to the extent of the value of the assets securing such obligations, or (ii) secured by a lien on property or assets that do not constitute Collateral to the extent of the value of the assets securing such obligations;

• will be effectively senior to other unsecured unsubordinated indebtedness to the extent of the value of the assets securing the Notes that is available after repayment of obligations secured by a lien on the collateral that is senior to the Notes; and

• will be structurally subordinated to all existing and future obligations of any of our existing or future subsidiaries that do not guarantee the Notes, including all of our non-U.S. subsidiaries.

As of December 31, 2013, after giving effect to the following three transactions, which we refer to as the Refinancing Transactions, including (i) the offering of the old notes, (ii) the $2.0 billion of additional senior secured borrowings described under—The Refinancing Transactions andExchange Offersand (iii) the use of proceeds from these

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financing activities to repay in full the VEBA Trust Note, (A) the Issuers and the guarantors had approximately $11.0 billion of secured indebtedness outstanding, of which approximately $4.8 billion would constitute First-Priority Lien Obligations (as defined herein) under the Senior Credit Facilities and Term Loan Credit Facility, in each case, excluding $1.3 billion of unused commitments under the revolving credit facility in the Senior Credit Facilities; (B) the Issuers and the guarantors had approximately $0.5 billion of unsecured indebtedness outstanding and (C) the non-guarantor subsidiaries had approximately $1.5 billion of indebtedness outstanding.

As of December 31, 2013, after giving effect to the Refinancing Transactions and the $1.9 billion special distribution paid by the Company to its members as part of Fiat North America LLC’s acquisition of the UAW Retiree Medical Benefits Trust’s equity interest in the Company, our non-guarantor subsidiaries had approximately $13.6 billion in total assets and had approximately $8.9 billion of total liabilities (including trade payables) to which the Notes were structurally subordinated.

For the period ended December 31, 2013, our non-guarantor subsidiaries accounted for approximately 31% of our Modified EBITDA and approximately 40% of our Modified Operating Profit.

Security The Notes and the related guarantees will, subject to prior Liens and certain other limitations, be secured by junior-priority liens on the Collateral owned by the Issuers and each guarantor. The Collateral generally consists of (i) 100% of the capital stock of the Co-Issuer and 100% of the capital stock of our existing and future domestic subsidiaries that is owned directly by us or any guarantor, (ii) 65% of the capital stock of all of our existing and future non-U.S. subsidiaries that is owned directly by us or any guarantor or by certain entities (including domestic subsidiaries) that are treated as pass through entities for U.S. federal income tax purposes and whose assets primarily consist of interests in non-U.S. subsidiaries (such entities “Transparent Subsidiaries”) and (iii) substantially all of the other property and assets that are held directly by the Issuers or any guarantor, to the extent that such assets secure any First-Priority Lien Obligations and to the extent that a junior-priority security interest is able to be granted or perfected therein.

The Collateral generally does not include (i) our capital stock, (ii) any assets of any of our non-U.S. subsidiaries, (iii) any capital stock of any of our non-U.S. subsidiaries, other than

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65% of the capital stock of our or any guarantor’s or any Transparent Subsidiary’s direct non-U.S. Subsidiaries, or (iv) any equity interest of a Transparent Subsidiary.

In addition, the indenture governing the Notes provides that any capital stock and other securities of any of our subsidiaries will be excluded from the collateral for so long as the pledge of such capital stock or other securities to secure the Notes would cause such subsidiary to be required to file separate financial statements with the SEC.

The granting of a lien on an asset and the priority of any lien are subject to exceptions. SeeDescription of the Notes —Security,Description of the Notes —Certain Covenants in the Indenture —Liens,Description of the Notes —Certain Covenants in the Indenture —Future Collateral,Description of the Notes —Certain Covenants in the Indenture —Covenant Fall-Away,Description of the Notes —Certain Definitions and Conventions —Permitted Liens andRisk Factors —Risks Related to Our Structure, the Notes and the Exchange Offers.

Intercreditor Agreement The collateral agent is a party to an intercreditor agreement with us, the guarantors, the collateral agent under the Senior Credit Agreement and the collateral agent under the new Term Loan Credit Agreement, which establishes the relative priority of the liens securing the Senior Credit Facilities, the Term Loan Credit Facility and the Notes and governs the relationship of the noteholders and the lenders under the Senior Credit Facilities and the Term Loan Credit Facility with respect to the Collateral. SeeDescription of Other Indebtedness —Intercreditor Agreement.

Optional Redemption The 2019 Notes and the Existing 2019 Notes will be redeemable, in whole or in part, at any time on or after June 15, 2015 at the redemption prices listed underDescription of the Notes —Optional Redemption —2019 Notes, plus accrued and unpaid interest, if any, to the date of redemption. Prior to June 15, 2014, we may also redeem up to 35% of the aggregate principal amount of the 2019 Notes and the Existing 2019 Notes at a redemption price equal to 108.000% of the principal amount of the 2019 Notes and the Existing 2019 Notes redeemed plus accrued and unpaid interest, if any, to the date of redemption with the net cash proceeds from certain equity offerings. The 2019 Notes and the Existing 2019 Notes will be redeemable, in whole or in part, at any time prior to June 15, 2015 at a redemption price equal to 100% of their principal amount, plus a “make whole” premium, together with accrued and unpaid interest, if any, to the redemption date.

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The 2021 Notes and the Existing 2021 Notes will be redeemable, in whole or in part, at any time on or after June 15, 2016 at the redemption prices listed underDescription oftheNotes —Optional Redemption —2021 Notes, plus accrued and unpaid interest, if any, to the date of redemption. Prior to June 15, 2014, we may also redeem up to 35% of the aggregate principal amount of the 2021 Notes and the Existing 2021 Notes at a redemption price equal to 108.250% of the principal amount of the 2021 Notes and Existing 2021 Notes redeemed plus accrued and unpaid interest, if any, to the date of redemption with the net cash proceeds from certain equity offerings. The 2021 Notes and Existing 2021 Notes will be redeemable, in whole or in part, at any time prior to June 15, 2016 at a redemption price equal to 100% of their principal amount plus a “make whole” premium, together with accrued and unpaid interest, if any, to the redemption date.

SeeDescription of the Notes —Optional Redemption.

Change of Control Event If a Change of Control Event occurs, as that term is defined inDescription of the Notes —Certain Definitions and Conventions, holders of the Notes will have the right, subject to certain conditions, to require us to repurchase their Notes at a purchase price equal to 101% of the aggregate principal amount of the Notes repurchased plus accrued and unpaid interest, if any, to the date of repurchase. SeeDescription of the Notes —Repurchase at the Option of Holders —Change of Control Event for further information regarding the conditions that would apply if we must offer holders this repurchase right.

Certain Covenants The indenture governing the Notes contains covenants limiting our and our Restricted Subsidiaries’ ability to:

• incur liens to secure indebtedness;

• pay dividends or make distributions or purchase or redeem capital stock or certain subordinated indebtedness;

• make certain other restricted payments;

• sell assets;

• enter into sale and lease-back transactions;

• enter into transactions with affiliates; and

• effect a consolidation, amalgamation or merger.

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These covenants are subject to a number of important qualifications, limitations and exceptions and in many circumstances may not significantly restrict our ability to take any of the actions described above. For more details, seeDescription of the Notes —Certain Covenants in the Indenture. If the Notes receive an Investment Grade rating, certain covenants in the indenture governing the Notes will, subject to limited exceptions, be terminated and the liens on the Collateral will be automatically released with respect to the Notes and the related guarantees. SeeDescription of the Notes—Certain Covenants in the Indenture —Covenant Fall-Away.

Risk Factors Investing in the Notes involves substantial risks. You should carefully consider all the information contained in this prospectus prior to participating in the exchange offers. In particular, we urge you to carefully consider the information set forth in the section under the headingRisk Factors for a description of certain risks you should consider before participating in the exchange offers.

Indenture The Notes will be issued under the indenture, dated as of May 24, 2011, with Wilmington Trust, as trustee, as supplemented by the first supplemental indenture, dated as of February 2, 2012, and the second supplemental indenture (the “Indenture”), dated as of April 5, 2013. The rights of holders of the Notes, including rights with respect to default, waivers and amendments, are governed by the Indenture.

Governing Law The Indenture, the security documents, the intercreditor agreement and the Notes are governed by the laws of the State of New York (or, to the extent required, by the laws of the jurisdiction in which the collateral is located).

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SUMMARY HISTORICAL CONSOLIDATED FINANCIAL AND OTHER DATA

The following table presents summary historical consolidated financial and other data of Chrysler Group (Successor) and Old Carco (Predecessor). The historical financial data has been derived from:

• Chrysler Group’s accompanying audited consolidated financial statements as of December 31, 2013 and 2012 and for the years ended December 31, 2013, 2012, and 2011 (Successor);

• Chrysler Group’s audited consolidated financial statements as of December 31, 2011 and 2010 and for the year ended December 31, 2010, which are not included in this prospectus;

• Chrysler Group’s audited consolidated financial statements as of December 31, 2009 and for the period from June 10, 2009 to December 31, 2009 (Successor), which are not included in this prospectus; and

• Old Carco’s audited consolidated financial statements as of June 9, 2009 and for the period from January 1, 2009 to June 9, 2009 (Predecessor), which are not included in this prospectus.

The following data should be read in conjunction withManagement’s Discussion and Analysis of Financial Condition and Results of Operations, Risk Factors, Selected Historical Consolidated Financial and Other Data, Business and the historical consolidated financial statements and notes thereto included elsewhere in this prospectus. Historical results for any prior period are not necessarily indicative of results to be expected in any future period.

This presentation is in accordance with the practice of Chrysler Group management. We do not review the results of operations for the Predecessor periods when assessing the performance of our operations. Our business during the Successor periods compared to the Predecessor periods has been impacted by the significant changes in capital structure, management, business strategies and product development programs that were implemented subsequent to the transaction approved under section 363 of the U.S. Bankruptcy Code in an effort to realize the benefits of the Fiat-Chrysler Alliance. For further details on our business, refer toBusiness.

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	Successor															Predecessor
	Year ended, and balance sheet data as of, December 31,												Period from June 10, 2009 to December 31, 2009			Period from January 1, 2009 to June 9, 2009
	2013			2012			2011			2010
	(in millions of dollars)															(in millions of dollars)
Consolidated Statements of Income Data:
Revenues, net	$	72,144		$	65,784		$	54,981		$	41,946		$	17,710		$	11,082
Gross margin		10,746			10,434			8,559			6,060			1,599			(1,934	)
Selling, administrative and other expenses		5,218			5,179			4,751			3,797			4,336			1,599
Research and development expenses, net		2,320			2,324			1,674			1,500			626			452
Restructuring (income) expenses, net (1)		(14	)		(61	)		3			48			34			(230	)
Interest expense (2)		1,035			1,094			1,238			1,276			470			615
Loss on extinguishment of debt (3)(4)		24			—			551			—			—			—
Impairment of brand name intangible assets (5)		—			—			—			—			—			844
Reorganization expenses, net (6)		—			—			—			—			—			843
Net income (loss)		2,757			1,668			183			(652	)		(3,785	)		(4,425	)
Consolidated Statements of Cash Flows Data:
Cash flows provided by (used in):
Operating activities	$	5,536		$	5,821		$	4,603		$	4,195		$	2,335		$	(7,130	)
Investing activities		(3,413	)		(3,557	)		(1,970	)		(1,167	)		250			(404	)
Financing activities		(302	)		(251	)		(405	)		(1,526	)		3,268			7,517
Other Financial Information:
Depreciation and amortization expense	$	2,941		$	2,701		$	2,876		$	3,051		$	1,587		$	1,537
Capital expenditures		3,434			3,633			3,009			2,385			1,088			239
Consolidated Balance Sheets Data at Period End:
Cash, cash equivalents and marketable securities	$	13,344		$	11,614		$	9,601		$	7,347		$	5,877		$	1,845
Restricted cash		333			371			461			671			730			1,133
Total assets		45,870			40,971			37,543			35,449			35,423			33,577
Current maturities of financial liabilities		491			456			230			2,758			1,092			2,694
Long-term financial liabilities		11,810			12,147			12,344			10,973			8,459			1,900
Members’ deficit		(1,242	)		(7,259	)		(6,035	)		(4,489	)		(4,230	)		(16,562	)
Other Statistical Information (unaudited):
Worldwide factory shipments (in thousands) (7)(9)		2,563			2,409			2,011			1,602			670			381
Net worldwide factory shipments (in thousands)(8)(9)		2,542			2,432			1,993			1,581			672			459
Worldwide vehicle sales (in thousands) (9)		2,401			2,194			1,855			1,516			725			593
U.S. dealer inventory at period end (in thousands)		509			427			326			236			179			246
Number of employees at period end (10)		73,712			65,535			55,687			51,623			47,326			48,237
Ratio of earnings to fixed charges		2.76x			2.48x			1.22x			N/A			N/A			N/A
Deficiency of earnings to cover fixed charges (e)		N/A			N/A			N/A			677			3,845			4,769
Proforma ratio of earnings to fixed charges (11)		3.40x
Proforma deficiency of earnings to cover fixed charges		N/A

(1) Old Carco initiated multi-year recovery and transformation plans aimed at restructuring its business in 2007, which were refined in 2008 and 2009 due to depressed economic conditions and decreased demand for its vehicles. We have continued to execute the remaining actions initiated by Old Carco. For additional information refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations.

(2) Interest Expense for the period from January 1, 2009 to June 9, 2009 excludes $57 million of contractual interest expense on debt subject to compromise.

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(3) In connection with the June 2013 amendment of our Senior Credit Facilities and the December 2013 re-pricing of the tranche B term loan maturing on May 24, 2017, or Tranche B Term Loan, we recognized a $24 million loss onextinguishment of debt. The loss consisted of the write off of $13 million of unamortized debt discounts and $3 million ofunamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of call premium and other fees associated with the amendments. Refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources —Senior Credit Facilitiesfor additional information.

(4) In connection with the May 2011 repayment of our outstanding obligations under the U.S. Treasury first lien credit facilities, or U.S. Treasury credit facilities, and the Export Development Canada Credit Facilities, or EDC credit facilities, we recognized a $551 million loss on extinguishment of debt. The charges consisted of the write off of $136 million of unamortized discounts and $34 million of unamortized debt issuance costs associated with the U.S. Treasury credit facilities and $367 million of unamortized discounts and $14 million of unamortized debt issuance costs associated with the EDC credit facilities.

(5) Old Carco recorded indefinite-lived intangible asset impairment charges of $844 million during the period from January 1, 2009 to June 9, 2009 related to its brand names. The impairment was primarily a result of the significant deterioration in Old Carco’s revenues, the ongoing volatility in the U.S. economy, in general, and in the automotive industry in particular, and a significant decline in its projected production volumes and revenues considering the market conditions at that time.

(6) In connection with Old Carco’s bankruptcy filings, Old Carco recognized $843 million of reorganization expenses, net during the period from January 1, 2009 to June 9, 2009, from the settlement of pre-petition liabilities, provisions for losses resulting from the reorganization and restructuring of the business, as well as professional fees directly related to the process of reorganizing Old Carco and its principal domestic subsidiaries under Chapter 11 of the U.S. Bankruptcy Code. These losses were partially offset by a gain on extinguishment of certain financial liabilities and accrued interest.

(7) Represents vehicle sales to our dealers, distributors, contract manufacturing customers and fleet customers. For additional information refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations —Worldwide Factory Shipments.

(8) Represents vehicle sales to our dealers, distributors, contract manufacturing customers and fleet customers adjusted for Guaranteed Depreciation Program, or GDP, vehicle shipments and auctions. For additional information refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations —Worldwide Factory Shipments.

(9) Vehicles manufactured by Chrysler Group for other companies, including for Fiat, are included in our worldwide factory shipments and new worldwide factory shipments, however, they are excluded from our worldwide vehicles sales.

(10) The number of employees provided for June 9, 2009 is as of June 30, 2009.

(11) Fixed charges of $989 million for the year ended December 31, 2013 on an unaudited pro forma basis, reflects $227 million of net interest savings from the Refinancing Transactions compared to the $1,216 million as reported in our December 31, 2013 consolidated financial statements.

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RISK FACTORS

Investing in the Notes involves a high degree of risk. You should carefully consider the following risk factors and all other information contained in this prospectus before deciding whether to participate in the exchange offers. The risks and uncertainties described below are not the only ones facing us. Additional risks and uncertainties that we are unaware of or that we currently believe to be immaterial, may also become important factors that affect us. If any of the following events occur, our business, financial condition and results of operations could be materially and adversely affected. In that case, we may not be able to make payments on the Notes, the value of the Notes could decline and you may lose some or all of your investment.

Risks Relating to Our Business

Our profitability depends on reaching certain minimum vehicle sales volumes. If vehicle sales deteriorate, our results of operations and financial condition will suffer.

Our continued profitability requires us to maintain certain minimum vehicle sales volumes. As is typical for an automobile manufacturer, we have significant fixed costs and, therefore, changes in our vehicle sales volume can have a disproportionately large effect on profitability. In addition, we generally receive payments from vehicle sales to dealers in North America within a few days of shipment from our assembly plants, whereas there is a lag between the time we receive parts and materials from our suppliers and the time we are required to pay for them. In this negative working capital environment, if vehicle sales decline we will suffer a significant negative impact on our cash flow and liquidity. If our vehicle sales were to decline to levels significantly below our assumptions, due to financial crisis, renewed recessionary conditions, changes in consumer confidence, geopolitical events, inability to produce sufficient quantities of certain vehicles, limited access to financing or other factors, our financial condition and results of operations would be materially adversely affected.

Our future success depends on our continued ability to introduce new or significantly refreshed vehicles that appeal to a wide base of consumers and to respond to changing consumer preferences, quality demands, economic conditions, and government regulations. In addition, we must continue to successfully and timely execute our ambitious launch program designed to substantially refresh and expand our vehicle portfolio, to realize a return on the significant investments we have made, to sustain market share and to achieve competitive operating margins.

Until 2011, our vehicle portfolio had fewer new or significantly refreshed vehicle models than many of our competitors, largely due to capital constraints experienced by Old Carco over the period from 2007 to 2009 and in the years immediately preceding that period. Our relative lack of new or significantly refreshed product offerings during this period continues to have an adverse effect on our vehicle sales, market share, average selling price and profitability. Until the launch of the Dodge Dart in 2012, we did not have an entry in the compact sedan segment, which is the second largest vehicle segment in the U.S. In addition, we did not have competitive entries in either the mid-size sedan segment (the largest segment in the U.S.) or mid-size sport utility vehicle, or SUV, segment (the largest SUV segment in the U.S.). Since we began operations in mid-2009, we have significantly upgraded, updated and broadened our product offerings to meet consumers’ changing demands and expectations as described in detail underBusiness —Products. In order to meet these goals, we invested heavily in vehicle, engine and powertrain design, engineering and manufacturing. These investments accelerated in 2012 and 2013, reducing our Free Cash Flow significantly. Our ability to realize acceptable returns on these investments depends in large part on consumers’ acceptance of our new or significantly refreshed vehicles, as well as our ability to timely complete the aggressive launch schedule we have planned without sacrificing quality. See—Vehicle defects may delay vehicle launches, or increase our warranty costs, below. For a description of our Free Cash Flow, seeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Non-GAAP Financial Measures —Free Cash Flow.

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We undertake significant market research and testing prior to developing and launching new or significantly refreshed vehicles. Nevertheless, market acceptance of our products depends on a number of factors, many of which are outside of our control and require us to anticipate consumer preferences and competitive products several years in advance. These factors include the market perception of styling, quality, safety, reliability, capability and cost of ownership of our vehicles as compared to those of our competitors, as well as other factors that affect demand, including price competition and financing or lease programs. If we fail to continue to introduce new or significantly refreshed vehicles that can compete successfully in the market, or if we fail to successfully reduce our concentration in vehicle segments that face declining consumer preferences, our financial condition and results of operations could deteriorate.

Competition has traditionally been intense in the automotive industry and has intensified further in recent years, including in the utility vehicle, minivan and truck segments that historically have represented most of our U.S. vehicle sales. In 2013, these segments accounted for approximately 70 percent of our vehicle sales in the U.S. whereas utility vehicle, minivan and truck sales accounted for only about 54 percent of the overall U.S. market during that time period. In prior years, our competitors have been successful in introducing new vehicles in these segments that have taken market share away from us. At times, consumer preference has shifted away from these vehicles, many of which have relatively low fuel economy, due to elevated fuel prices, environmental concerns, economic conditions, governmental actions or incentives, and other reasons, adversely affecting our overall market share and profitability. Despite our heavy cadence of new vehicle introductions since mid-2009, we still have fewer competitive passenger cars and utility vehicles, particularly smaller, fuel-efficient vehicles, than our competitors. This may present challenges for us in the market going forward as consumers focus more on fuel economy, resulting in increased demand for hybrid vehicles. Therefore, a return to higher fuel prices and continued volatility in fuel prices or fuel shortages, particularly in the U.S., could have a disproportionate effect on our vehicle sales as compared to our competitors.

If our new or significantly refreshed vehicles are not received favorably by consumers, our vehicle sales, market share and profitability will suffer. If we are required to cut capital expenditures due to insufficient vehicle sales and profitability or if we decide to reduce costs and conserve cash, our ability to continue our program of improving and updating our vehicle portfolio and keeping pace with product and technological innovations introduced by our competitors will be diminished, which may further reduce demand for our vehicles.

Economic weakness, including elevated unemployment levels, has at times adversely affected our business, particularly in our principal market, North America. If economic conditions do not continue to improve, or if they weaken, or if unemployment levels do not improve at the same pace as general economic conditions, our results of operations could be negatively affected. Additionally, North American demand for vehicles has steadily increased from 2010; however, that increase may be partially attributable to the average age of vehicles on the road following the sustained downturn from 2007 to 2010 and historically low industry sales in 2011. To the extent the increase in vehicle demand is attributable to pent-up demand rather than overall economic growth, future vehicle sales may lag behind improvements in general economic conditions or employment levels.

Our business, financial condition and results of operations have been, and may continue to be, adversely affected by worldwide economic conditions. Overall demand for our vehicles, as well as our profit margins, could decline as a result of many factors outside our control, including economic recessions, changes in consumer preferences, increases in commodity prices, changes in laws and regulations affecting the automotive industry and the manner in which they are enforced, inflation, fluctuations in interest and currency exchange rates and changes in the fiscal or monetary policies of governments in the areas in which we operate, the effect of which may be exacerbated during periods of general economic weakness. Depressed demand for vehicles affects our suppliers as well. Any decline in vehicle sales we experience may, in turn, adversely affect our suppliers’ ability to fulfill their obligations to us, which could result in production delays, defaults and inventory management challenges. These supplier events could further impair our ability to build and sell vehicles.

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An erosion in current financial conditions, an increase in unemployment levels or a decline in consumer confidence could place significant economic pressures on consumers and our dealer network and may impair the demand for our products, and our financial condition and results of operations could be materially and adversely affected. Further, even if economic conditions improve, a corresponding increase in vehicle sales may not occur due to other factors such as rising interest rates (see —Vehicle sales depend heavily on adequacy of vehicle financing options, which have been at historically low interest rates. To the extent that interest rates for vehicle financing rise, consumers may be unable to afford vehicles as a result of higher interest payments, or we may need to increase our use of subvention programs to maintain or increase our vehicle sales, either of which would adversely affect our financial condition and results of operations below), changes in consumer spending habits and other factors, or the failure of unemployment levels to improve at the same pace as general economic conditions, which may constrain demand for our products and adversely affect our financial condition and results of operations.

In recent periods, approximately 90 percent of our vehicle sales were to customers in the U.S., Canada and Mexico. In the U.S., where we sell most of the vehicles we manufacture, industry-wide vehicle sales declined from 16.5 million vehicles in 2007 to 10.6 million vehicles in 2009. After several years of gradual economic recovery, U.S. vehicle sales reached 15.9 million in 2013. We believe the growth in our sales occurred largely because of our significant investments in vehicle design, engineering and manufacturing through which we broadened and upgraded our product portfolio. Overall, however, economic recovery in North America has been slower and less robust than many industry analysts predicted. This recovery in vehicle sales may not be sustained. For instance, renewed weakness in the U.S. new home construction market would likely depress sales of pick-up trucks, one of our strongest selling products, representing approximately 19 percent of our U.S. vehicle sales in 2013. In addition, such recovery may be partially attributable to the pent-up demand and average age of vehicles on the road following the extended economic downturn so there can be no assurances that continuing improvements in general economic conditions or employment levels will lead to corresponding increases in industry-wide vehicles sales. As a result, we may experience declines in vehicle sales in the future, and we may not realize a sufficient return on the investments we have made or that we plan to make in the future. Accordingly, our financial condition and results of operations would be materially affected.

Although we are increasing our vehicle sales outside of North America, we anticipate that our results of operations will continue to depend substantially on vehicle sales in the North American markets. Our vehicle sales in North America will therefore continue to be critical to our plans to maintain and improve current levels of profitability. Our principal competitors, including General Motors Company, Ford Motor Company and Toyota Motor Corporation, however, are more geographically diversified and are less dependent on sales in North America. As a result, any decline in demand in the North American market would have a disproportionately large negative effect on our vehicle sales and profitability relative to our principal competitors, whose vehicle sales are not similarly concentrated.

We depend on the Fiat-Chrysler Alliance to provide new vehicle platforms and powertrain technologies, additional scale, global distribution and management resources that are critical to our viability and success.

In connection with the transaction approved under section 363 of the U.S. Bankruptcy Code, or the 363 Transaction, we entered into an alliance with Fiat, or the Fiat-Chrysler Alliance. The Fiat-Chrysler Alliance is intended to provide us with a number of long-term benefits, including access to new vehicle platforms and powertrain technologies, particularly in smaller, more fuel-efficient segments where we historically did not have a significant presence, as well as procurement benefits, management services and global distribution opportunities. The Fiat-Chrysler Alliance is also intended to facilitate our penetration into several international markets where we believe our products would be attractive to consumers, but where we historically have not had significant penetration or existing dealer and distribution networks.

We believe that our ability to realize the benefits of the Fiat-Chrysler Alliance is critical for us to compete with our larger and better-funded competitors. If we are unable to convert the opportunities presented by the Fiat-

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Chrysler Alliance into long-term commercial benefits, either by improving sales of our vehicles and service parts, reducing costs or both, and reducing our reliance on North American vehicle sales, our financial condition and results of operations may be materially adversely affected.

Because of our dependence on the Fiat-Chrysler Alliance, and Fiat’s recent acquisition of the equity interests in us that it did not previously own, any adverse developments at Fiat could have a material adverse effect on our business, financial condition and results of operations. Although Fiat has executed its own significant industrial restructuring and financial turnaround, it, like us, remains smaller and less well-capitalized than many of its principal competitors in its home market and globally, and Fiat has historically operated with more limited capital than many other global automakers. Moreover, Fiat’s sales and revenues have been negatively affected by the continuing economic weakness in several European countries, especially in its domestic market, Italy. Like other manufacturers and suppliers in Europe, Fiat has considerable excess manufacturing capacity. If Fiat’s ability to fulfill its obligations under the Fiat-Chrysler Alliance is impaired or management or operational attention is otherwise diverted away from our alliance, we may not realize all of the benefits we anticipate from the Fiat-Chrysler Alliance, which would adversely affect our financial condition and results of operations.

Meeting our objective of increasing our vehicle sales outside North America is largely dependent upon access to Fiat’s network of distribution arrangements, manufacturing capacity and local alliance partners.

We are heavily focused on North America and do not have a significant presence in some of the fastest growing automotive markets, specifically China, India and Brazil. To capitalize on growth opportunities in markets outside North America profitably, we will likely need to leverage Fiat’s infrastructure of distribution arrangements, manufacturing facilities and local alliance partners because the alternative of developing our own infrastructure would be time consuming, capital intensive, inefficient and risk prone.

Our international growth ambitions may conflict with Fiat’s interests in the regions in which we may wish to increase sales, particularly in Latin America where Fiat has a history of successful operations and in other emerging markets, such as China, where Fiat has invested significant resources to develop local infrastructure and alliance partners to facilitate its own successful product launches.

Product development cycles can be lengthy, and there is no assurance that new designs will lead to revenues from vehicle sales, or that we will be able to accurately forecast demand for our vehicles, potentially leading to inefficient use of our production capacity, which could harm our business.

It generally takes two years or more to design and develop a new product, and there may be a number of factors that could lengthen that schedule. Because of this product development cycle and the various elements that may contribute to consumers’ acceptance of new vehicle designs, including competitors’ product introductions, fuel prices, general economic conditions, changes in perceptions about our brands’ images and changes in styling preferences, we cannot be certain that an initial product concept or design that appears to be attractive will result in a production model that will generate sales in sufficient quantities and at high enough prices to be profitable. If our designs do not result in the development of products that are accepted in the market, our financial condition and results of operations may be adversely affected. Additionally, our high proportion of fixed costs, both due to our significant investment in property, plant and equipment as well as the requirements of our collective bargaining agreements, which limit our flexibility in quickly calibrating personnel costs to changes in demand for our products, further exacerbate the risks associated with incorrectly assessing demand for our vehicles.

The North American automotive industry has undergone substantial restructuring over the past several years, resulting in widespread consolidation among vehicle manufacturers and suppliers. This restructuring was aimed largely at reducing the substantial excess capacity that existed throughout the automotive supply chain prior to 2009. While the industry’s successful reduction in capacity has lowered break-even production rates, many companies are still adjusting to these changes and have limited access to capital. Accordingly, there is currently little available capacity for certain materials, parts and components to respond in the short term to an

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unanticipated increase in demand. For the past four years, we have encountered challenges in our operations with:

• Our ability to rapidly increase production levels inhibited by our suppliers’ inability to provide greater than forecasted volumes of raw materials and components, and those suppliers’ inability to increase their own production rapidly enough to meet our demand, particularly in light of our industry’s focus on just-in-time inventory systems;

• Launch delays for certain of our vehicles due to technical challenges when introducing new vehicle models or technology, and daily part supply issues due to our plants and suppliers operating at or in excess of full capacity, have resulted in lost shipments compared to our original planning assumptions; and

• Increased costs due to employee overtime, expedited procurement and transportation of raw materials and parts, component banking costs, and other expenditures, all of which have driven up costs for manufacturing and logistics and, which, if not addressed, may further impact our profitability over the long term.

These rapid increases in manufacturing volumes may also adversely affect our manufacturing quality, partly due to the challenge of hiring, training and overseeing a growing workforce. Such downturns in quality could delay production and deliveries, or could generate product recalls and warranty claims. These results could reduce our margins and adversely impact consumer satisfaction. In addition, we may not be able to properly repair or maintain our equipment in these conditions, which could cause us to lose valuable manufacturing capability in the long run.

If, on the other hand, demand does not develop as we forecast, we could have excess inventory, and we may need to increase sales incentives to sell off inventory, and/or take impairments or other charges. Furthermore, increases in manufacturing volumes to meet forecasted demand may require increases in fixed and other costs, and without a corresponding increase in vehicle sales, our profitability and cash flow could decline. Lower than forecasted demand could also result in excess manufacturing capacity and reduced manufacturing efficiencies, which could reduce margins and profitability.

Constraints on our ability to increase production capacity using our existing manufacturing facilities may limit our vehicle sales and growth opportunities without significant capital expenditures to increase our manufacturing capacity.

Our ability to increase vehicle sales depends on our manufacturing facilities’ capacity to meet demand for our vehicles. If we are not able to adjust our manufacturing capacity to meet rising demand for our products, our prospects for growth and our operating results will be adversely affected. In 2013, our North American assembly manufacturing facilities were operating, on average, at 109 percent of Harbour capacity (the capacity of two eight-hour shifts a day for 235 workdays per year, a common manufacturing metric of productivity) and some of our manufacturing facilities have already reached their maximum production capacity (three shifts or crews and maximum overtime). In the future, we may only be able to increase our vehicle output for certain vehicles by making significant capital investments in new or expanded manufacturing facilities, or by relying on available manufacturing capacity of other parties, including Fiat, however our ability to use such manufacturing capacity of other parties is dependent on such other parties having open capacity that they do not have plans to utilize, and is also dependent on our ability to reach agreement with such parties on commercial terms and conditions, including economics, for the use of such manufacturing capacity.

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Our ability to achieve cost reductions and to realize production efficiencies is critical to maintaining our competitiveness and long-term profitability.

We are continuing to implement a number of cost reduction and productivity improvement initiatives in our automotive operations, through the Fiat-Chrysler Alliance and otherwise, including, for example, increasing the number of our vehicles that are based on common platforms, reducing our dependence on sales incentives offered to dealers and consumers, leveraging our purchasing capacity and volumes with Fiat’s and implementing World Class Manufacturing, or WCM, principles. Our future success depends upon our ability to implement these initiatives throughout our operations. In addition, while some of the productivity improvements are within our control, others depend on external factors, such as commodity prices, supply capacity limitations, or trade regulation. These external factors may impair our ability to reduce our costs as planned, and we may sustain larger than expected production expenses, materially affecting our business and results of operations. Furthermore, reducing costs may prove difficult due to our focus on introducing new and improved products in order to meet consumer expectations.

The automotive industry is highly competitive. Our competitors’ efforts to increase their share of vehicle sales could have a significant negative impact on our vehicle pricing, market share and operating results.

The automotive industry is highly competitive, particularly in the U.S., our primary market. Our competitors, particularly those who are better capitalized, with larger market shares and with captive finance companies, may respond to negative market conditions by not only adding vehicle enhancements and offering option package discounts to make their vehicles more attractive but also providing subsidized financing or leasing programs, offering price rebates or other sales incentives or by reducing vehicle prices in certain markets. We may not be able to take similar actions or be able to sustain such actions without significantly eroding our margins and financial performance even if we are able to maintain market share. In addition, manufacturers in countries such as China and India, which have lower production costs, have announced that they intend to export lower-cost automobiles to established markets, including North America. With excess manufacturing capacity growing in Europe, historically higher-priced, desirable vehicles from that region may become available for sale in North America at lower prices. These actions have had, and are expected to continue to have, a significant negative impact on our vehicle pricing, market share, and operating results, and present a significant risk to our ability to improve or even maintain our average selling price per vehicle.

Offering desirable vehicles that appeal to consumers can mitigate the risks of increased price competition, but vehicles that are perceived to be less desirable, whether in terms of price, quality, styling, safety, fuel efficiency or other attributes, can exacerbate these risks.

Certain arrangements with Fiat under the Fiat-Chrysler Alliance may adversely affect our business, financial condition and results of operations.

We have entered into a number of agreements with Fiat to implement and extend the Fiat-Chrysler Alliance. Under these agreements, we and Fiat have each agreed to provide the other with goods, services and other resources. We expect to enter into additional agreements in connection with the Fiat-Chrysler Alliance from time to time. Although the terms of any such transactions with Fiat will be established in order to comply with our obligations under our senior credit agreement, as amended and restated as of June 21, 2013, or Senior Credit Agreement, the term loan credit agreement governing our Term Loan Credit Facility (as defined herein), or Term Loan Credit Agreement, and the indenture dated as of May 24, 2011, as supplemented by the first supplemental indenture, dated as of February 2, 2012, and the second supplemental indenture, dated as of April 5, 2013, that governs our Secured Senior Notes (as defined herein), or Secured Senior Notes Indenture, the terms of any such transactions may not be as favorable to us as we would otherwise have obtained in a transaction with a party other than Fiat, particularly as our operations become further integrated. In addition, while our Senior Credit Agreement, the Term Loan Credit Agreement and the Secured Senior Notes Indenture, include affiliate transaction covenants designed to promote fairness to us of transactions between Fiat and us, compliance with

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these covenants may not prevent us from entering into transactions, including financing and treasury transactions, that are or become, particularly with the benefit of future hindsight, unfavorable to us.

As a distributor of Fiat vehicles, we also depend on Fiat for the supply of vehicle inventory of certain Fiat products. Further, beginning with the production of the all-new Fiat 500L, Fiat contract manufactures some of the vehicles we sell from which we derive original equipment manufacturer profits. If Fiat’s supply of vehicles to us is disrupted, or if consumer demand for Fiat vehicles changes, our revenue from the distribution and sales of Fiat vehicles could be adversely affected. See—We depend on the Fiat-Chrysler Alliance to provide new vehicle platforms and powertrain technologies, additional scale, global distribution and management resources that are critical to our viability and success above.

Additionally, those Fiat vehicles that we sell in the U.S. are included in our Corporate Average Fuel Economy, or CAFE, fleet compliance report we submit to the National Highway Traffic Safety Administration, or NHTSA, pursuant to the Energy Independence and Security Act, or EISA, as well as in our fleet compliance report we submit to the Environmental Protection Agency, or EPA, pursuant to the Model Year 2012-2016 Light Duty Vehicle Greenhouse Gas Rule. A disruption of Fiat’s supply of such vehicles, or of technology or powertrains, to us could have an effect on the model year average fuel economy ratings of our fleet, which, in turn, could affect consumer perception of our company and our sales. See—Laws, regulations and governmental policies, including those regarding increased fuel economy requirements and reduced greenhouse gas emissions, may have a significant effect on how we do business and may adversely affect our results of operationsbelow for further information.

Finally, not only may such arrangements result in actual or perceived conflicts of interest, but as both parties pursue cost savings through joint procurement, contract manufacturing and engineering and technological development, we each become more reliant on the other and may become exposed to any risks to each other’s business and financial condition, or may disagree as to the best method to share any benefits, which may in turn exacerbate the potential for conflicts of interest.

As the sole beneficial owner of our outstanding equity interests, Fiat controls our management, operations and corporate decisions and Fiat’s interests as an equity holder may conflict with the interests of the holders of our debt.

Fiat, as the sole beneficial owner of our outstanding equity interests, has the power to appoint all of our directors and the ability to control our management and operations, including decisions regarding the focus of our operations and with respect to significant corporate transactions such as mergers and acquisitions, asset sales, borrowings, issuances of securities and our dissolution, as well as amendments to our organizational documents, subject to compliance with our contractual obligations. To the extent permitted under our financing arrangements, Fiat may also cause us to pay distributions or make loans for its benefit. The interests of Fiat may not in all cases be aligned with those of the holders of our debt, including the Notes.

Also see —Certain arrangements with Fiat under the Fiat-Chrysler Alliance may adversely affect our business, financial condition and results of operations.

Certain of our executive officers and employees serve in similar roles for Fiat or its current or former affiliates, which may result in conflicts of interest for our management.

We benefit from the significant management experience of Fiat’s leadership team. Our current Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer serve in those same roles for Fiat. Our current Chief Executive Officer, Chief Financial Officer and certain of our other executive officers and employees serve on a Fiat executive management committee (the Group Executive Council, or GEC) formed to oversee the management and integration of all Fiat interests, including its interest in Chrysler Group. Although the GEC cannot contractually bind Chrysler Group and recommendations made by the GEC to Chrysler Group, including

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transactions with Fiat affiliates, are subject to our own internal review and approval procedures, these potential conflicts may still affect us.

Moreover, in addition to serving as Chief Executive Officer of both Fiat and Chrysler Group, Mr. Marchionne also serves as Chairman or Chief Executive Officer for key Fiat subsidiaries including Fiat Group Automobiles S.p.A., or Fiat Group Automobiles, and for other current or former affiliates of Fiat, including CNH Industrial N.V., or CNH Industrial, which operates the capital goods business formerly owned by Fiat. Mr. Marchionne has not received any salary compensation from us for serving as our Chief Executive Officer other than the compensation provided to our directors generally.

We do not have a specified allocation of required time and attention for Mr. Marchionne, our Chief Financial Officer or certain other members of management. If any of them allocates more time and attention to non-Chrysler matters, our business, financial condition and results of operations may suffer.

We may not be successful in increasing our vehicle sales outside of North America, and if we do increase our vehicle sales outside of North America we will be exposed to additional risks of operating in different regions and countries.

We generate a small, but growing, proportion of our vehicle sales outside of North America, with approximately 10 percent of our vehicle sales occurring outside North America in 2013. Currently we have very limited manufacturing operations outside of North America and substantially rely on exporting vehicles made in North America to generate vehicles sales outside of North America. This makes us particularly vulnerable to increases in import restrictions and other trade barriers as well as foreign currency exchange rate changes. For example, decisions by Brazil and Argentina to terminate their respective free trade agreements with Mexico and impose import quotas have impacted our plans to leverage our manufacturing capacity in Saltillo, Mexico, where we make the all-new ProMaster commercial van as part of our Ram lineup, and to manufacture additional commercial vans for Fiat to sell under the Ducato name plate in Brazil. One of our longer-term strategic objectives is to capitalize on opportunities presented by the Fiat-Chrysler Alliance, and we intend to actively pursue growth opportunities in a number of markets outside North America. In light of the inherent risks of growing in international markets, we may not be able to profitably capitalize on opportunities to establish a production base and distribution network and expand internationally.

Expanding our operations and vehicle sales internationally may subject us to additional regulatory requirements and cultural, political and economic challenges, including the following:

• securing relationships to help establish our presence in local markets, including distribution and vehicle finance relationships;

• hiring and training personnel capable of marketing our vehicles, supporting dealers and retail customers, and managing operations in local jurisdictions;

• identifying and training qualified service technicians to maintain our vehicles, and ensuring that they have timely access to diagnostic tools and parts;

• localizing our vehicles to target the specific needs and preferences of local consumers, including with respect to vehicle safety, fuel economy and emissions, which may differ from our traditional retail customer base in North America;

• implementing new systems, procedures and controls to monitor our operations in new markets;

• multiple, changing and often inconsistent enforcement of laws and regulations;

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• satisfying local regulatory requirements, including those for vehicle safety, content, fuel economy or emissions;

• competition from existing market participants that have a longer history in, and greater familiarity with, the local markets we enter;

• differing labor regulations and union relationships;

• consequences from changes in tax laws;

• tariffs and trade barriers;

• laws and business practices that favor local competitors;

• anti-corruption and anti-bribery laws;

• fluctuations in currency exchange rates;

• extended payment terms and the ability to collect accounts receivable;

• imposition of limitations on conversion of foreign currencies into U.S. dollars, or USD, or remittance of dividends and other payments by foreign subsidiaries; and

• changes in a specific country’s or region’s political or economic conditions.

For example, the Venezuelan President recently signed a decree and received the Venezuelan Assembly’s approval to impose price controls on new and used vehicles in an attempt to slow inflation. Once enacted, the new law would make it unlawful to sell a new or used vehicle above the maximum price set for such vehicle by the Venezuelan government. In addition to the limitation on our ability to access and transfer liquidity out of Venezuela as a result of certain Venezuelan foreign currency exchange regulations, see—Laws, regulations or governmental policies in foreign countries may limit our ability to access our own funds below, such cap on vehicle prices and the general economic and political instability in Venezuela may significantly limit or prevent us from continuing our existing operations in Venezuela.

Moreover, for the past several years, sustained economic weakness in several European countries has slowed our plans to sell more vehicles through the Fiat dealer network in that region.

If we fail to address these challenges and other risks associated with international expansion, we may encounter difficulties implementing our strategy, which could impede our growth or harm our operating results.

Dealer sourcing and inventory management decisions could adversely affect sales of our vehicles and service parts.

We sell most of our vehicles and service parts through our dealer network. Our vehicle and service part sales depend on the willingness and ability of our dealer network to purchase vehicles and service parts for resale to consumers. Our dealers’ willingness and ability to make these purchases depends, in turn, on the rate of their retail vehicle sales, as well as the availability and cost of capital and financing necessary for dealers to acquire and hold inventories for resale. The dealers carry inventories of vehicles and service parts in their ongoing operations and they adjust those inventories based on their assessment of future sales prospects, their ability to obtain wholesale financing and other factors. Certain of our dealers may also carry products or operate separate dealerships that carry products of our competitors and may focus their inventory purchases and sales efforts on

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products of our competitors due to industry and product demand or profitability. These inventory and sourcing decisions can adversely impact our sales, financial condition and results of operations.

Availability of adequate financing on competitive terms for our dealers and consumers is critical to our success. Our lack of a captive finance company could place us at a competitive disadvantage to other automakers that may be able to offer consumers and dealers financing and leasing on better terms than our customers and dealers are able to obtain. In lieu of a captive finance company, we will depend on our relationship with SCUSA to supply a significant percentage of this financing, and we continue to depend on our former partner, Ally, as we transition to the new SCUSA relationship.

Our dealers enter into wholesale financing arrangements to purchase vehicles from us to hold in inventory to facilitate vehicle sales, and retail customers use a variety of finance and lease programs to acquire vehicles. Leasing volumes for our vehicles are significantly below market levels. Our inability to offer competitive leases may negatively impact our vehicle sales volumes and market share. Our results of operations therefore depend on establishing and maintaining appropriate sources of financing for our dealers and retail customers.

Unlike most of our competitors who operate and control affiliated finance companies, we do not have a finance company dedicated solely to our operations. Our competitors with dedicated or 100 percent owned finance companies may be better able to implement financing programs designed principally to maximize vehicle sales in a manner that optimizes profitability for them and their finance companies on an aggregate basis, including with respect to the amount and terms of the financing provided. If such competitors offer retail customers and dealers financing and leasing on better terms than our dealers are able to obtain, consumers may be more inclined to purchase or lease our competitors’ vehicles and our competitors’ dealers may be better able to stock our competitors’ products, each of which could adversely affect our results of operations. In addition, unless financing arrangements other than for retail purchase continue to be developed and offered by banks to retail customers in Canada, our lack of a captive finance company could present a competitive disadvantage in Canada, as banks are restricted by law from providing retail lease financing in Canada.

On May 1, 2013, Santander Consumer USA Inc., or SCUSA, began serving as our private-label financing provider under the Chrysler Capital brand name and managing retail and wholesale financing needs for our dealers and retail customers following the termination of our relationship with Ally Financial Inc., or Ally, in April 2013. Our decision to transition our financing services relationship to SCUSA and to develop a private-label financing solution subjects us to significant risks, particularly in the short term as SCUSA ramps up its operations to serve the financing needs of our dealers and retail customers. If SCUSA is unable to timely provide an acceptable level of service including response time, approval rates and a full range of competitive financing products at competitive rates, our vehicle sales may suffer. As of December 31, 2013, SCUSA and Ally were providing wholesale lines of credit to approximately three percent and 43 percent of our dealers in the U.S., respectively. Ally has continued to provide dealer financing since the termination of our relationship with them, though they are no longer obligated to provide such financing. In accordance with the terms of the Auto Finance Operating Agreement that we signed with Ally in August 2010, or Ally Agreement, we remain obligated to repurchase Ally-financed U.S. dealer inventory that was acquired on or before April 30, 2013 upon certain triggering events and with certain exceptions. As of December 31, 2013, the maximum potential amount of future payments required to be made to Ally under this guarantee was approximately $230 million and was based on the aggregate repurchase value of eligible vehicles financed by Ally in our U.S. dealer stock. The fair value of the guarantee was less than $0.1 million at December 31, 2013.

Any financing services provider, including SCUSA, will face other demands on its capital, including the need or desire to satisfy funding requirements for dealers or customers of our competitors as well as liquidity issues relating to other investments. Furthermore, SCUSA is highly dependent on its relationship with Banco Santander, S.A. for funding. Also, because SCUSA is not a depository institution, SCUSA does not have access to low cost insured deposit funding, and is subject to certain state licensing regimes and various operational compliance requirements that lenders who are depository institutions do not face. SCUSA is sensitive to regulatory changes

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that may increase its costs through stricter regulations or increased fees pursuant to such regulations. If SCUSA fails to adequately comply with regulations, or faces a significant increase in compliance costs or fees, SCUSA’s ability to provide competitive financing products to our dealers and retail customers may suffer. Therefore, SCUSA may not have the capital and liquidity necessary to support our vehicle sales, and even with sufficient capital and liquidity, they may apply lending criteria in a manner that will adversely affect our vehicle sales.

Additionally, a relatively high percentage of the customers who seek financing may not qualify for conventional automotive finance products as a result of, among other things, a lack of or adverse credit history, low income levels and/or the inability to provide adequate down payments. If interest rates increase substantially or if financing service providers, including SCUSA, tighten their lending standards or restrict their lending to certain classes of credit, consumers may not be able to obtain financing to purchase or lease our vehicles.

To the extent that either SCUSA is unable or unwilling to provide sufficient financing at competitive rates to our dealers and consumers, or we encounter challenges in our transition from Ally to SCUSA, our dealers and consumers may not have sufficient access to such financing. As a result, our vehicle sales and market share may suffer, which would adversely affect our financial condition and results of operations.

Ally has commenced litigation against SCUSA alleging infringement of intellectual property by SCUSA in connection with its financing arrangement with us. To the extent that the outcome of this litigation is adverse to SCUSA, SCUSA may have difficulty fulfilling its obligations to us, which could have a material adverse effect on our business, results of operations and financial condition.

In September 2013, Ally sued SCUSA alleging breaches of copyright and misappropriation of trade secrets in connection with SCUSA’s provision of financing solutions to our dealers and retail customers. This litigation is pending in U.S. federal court. An outcome that is adverse to SCUSA may impair SCUSA’s ability to provide the services contemplated by our agreement. In particular, the allegations relate to intellectual property which SCUSA currently uses in the provision of financing under the Chrysler Capital brand name. If SCUSA is prevented from utilizing this intellectual property, its ability to provide services may be impaired unless and until it produces new materials outside the scope of the litigation. In addition, if the litigation results in a judgment which is materially adverse to SCUSA, it may impair SCUSA’s ability to support our vehicle sales.

Vehicle sales depend heavily on adequacy of vehicle financing options, which have been at historically low interest rates. To the extent that interest rates for vehicle financing rise, consumers may be unable to afford vehicles as a result of higher interest payments, or we may need to increase our use of subvention programs to maintain or increase our vehicle sales, either of which would adversely affect our financial condition and results of operations.

Financing for new vehicle sales has been available at relatively low rates for several years and rates are generally predicted to rise over the next several years. The low interest rates available to consumers to finance vehicles have resulted in lower monthly payments for such vehicles. Our agreement with SCUSA provides that SCUSA will use best efforts to charge consumers interest rates that are competitive in the marketplace. To the extent that interest rates rise generally in the U.S., market rates for new vehicle financing are expected to rise as well. This would result in consumers paying a higher monthly payment for the same amount financed, which may decrease the number of vehicles that consumers are able to afford or steer consumers to less expensive vehicles, adversely affecting our financial condition and results of operations. Furthermore, because many of our customers have relatively low credit scores and may therefore be more sensitive to changes in the availability and adequacy of financing and macroeconomic conditions than more affluent consumers, our vehicle sales may be disproportionately affected by changes in financing conditions relative to the vehicle sales of our competitors.

Alternatively, in order to maintain our vehicle sales, we may be required to enter into additional subvention programs under our private-label financing agreement with SCUSA, or the SCUSA Agreement, or increase the amount of interest rates we subsidize in our subvention programs. SeeBusiness —Distribution —Dealer and

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Customer Financing for a description of the practice of subvention. In the case of subvention programs, we subsidize interest rates or cash payments at the inception of a financing arrangement. In the event we add additional subvention programs or increase the amount of the subsidy on any subvention program in order to keep the rates paid by our customers in line with current rates following a rise in market interest rates, our payments to SCUSA would increase under the terms of the SCUSA Agreement, which would adversely affect our financial condition and results of operations.

Our business plan depends on maintaining a disciplined approach to the use of dealer and retail incentives to sell vehicles, and our ability to modify these market practices is uncertain.

The intense competition and limited ability to reduce fixed costs that characterize the automotive industry has in many cases resulted in significant over-production of vehicles. These factors, together with significant excess manufacturing capacity, have historically driven manufacturers, including us, to rely heavily on sales incentives to drive vehicle sales. These incentives have included both dealer incentives, typically in the form of dealer rebates or volume-based awards, as well as retail incentives in a variety of forms, including subsidized financing, price rebates and other incentives. As part of the business plan and related performance targets we announced on November 4, 2009 for the 2010 through 2014 period, or the 2010-2014 Business Plan, we are attempting to reduce our reliance on incentives, which might negatively affect our sales volumes. If, despite our efforts, we are unable to reduce our reliance on short-term sales incentives, and maintain price discipline, our financial condition and results of operations may be adversely affected.

Vehicle defects may delay vehicle launches, or increase our warranty costs.

Manufacturers are required to remedy defects related to motor vehicle safety and emissions through recall campaigns, and a manufacturer is obligated to recall vehicles if it determines that they do not comply with an applicable Federal Motor Vehicle Safety Standard, or FMVSS. In addition, if we determine that a safety or emissions defect or a non-compliance exists with respect to certain of our vehicles prior to the start of production, the launch of such vehicle could be delayed until we remedy the defect or non-compliance. The costs associated with any protracted delay in new model launches necessary to remedy such defect, and the cost of providing a free remedy for such defects or non-compliance in vehicles that have been sold, could be substantial. Additionally, potential issues relating to our use of new powertrain technology in certain of our new vehicles may create delays, and the cost of remedying defects in engines and transmissions can be substantial. We are also obligated under the terms of our warranty to make repairs or replace parts in our vehicles at our expense for a specified period of time. Therefore, any failure rate that exceeds our assumptions may result in unanticipated losses. Furthermore, an integral part of the 2010-2014 Business Plan is the continued refresh and growth of our vehicle portfolio, and we have committed significant capital and resources toward an aggressive launch program of completely new vehicles, on all new platforms, with additions of new powertrain and transmission technology. This is in contrast to many of our competitors with a more diverse and updated portfolio and makes us comparatively more vulnerable to launch delays. See—Our future success depends on our continued ability to introduce new or significantly refreshed vehicles that appeal to a wide base of consumers and to respond to changing consumer preferences, quality demands, economic conditions, and government regulations. In addition, we must continue to successfully and timely execute our ambitious launch program designed to substantially refresh and expand our vehicle portfolio, to realize a return on the significant investments we have made, to sustain market share and to achieve competitive operating margins above.

Product recalls may result in direct costs and loss of vehicle sales that could have material adverse effects on our business.

From time to time, we have been required to recall vehicles to address performance, compliance or safety-related issues. The costs we incur to recall vehicles typically include the cost of the new remedy parts and labor to remove and replace the problem parts, and may substantially depend on the nature of the remedy and the number of vehicles affected. Product recalls also harm our reputation and may cause consumers to question the safety or

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reliability of our products. For example, we estimate that we will incur costs of $151 million in connection with a voluntary safety recall for the 1993-1998 Jeep Grand Cherokee and the 2002-2007 Jeep Liberty and a customer satisfaction action for the 1999-2004 Jeep Grand Cherokee, which we initiated following a recall request from NHTSA related to the risk of fuel tank fire from rear impact collisions.

Any costs incurred, or lost vehicle sales, resulting from product recalls could materially adversely affect our business. Moreover, if we face consumer complaints, or we receive information from vehicle rating services that calls into question the safety or reliability of one of our vehicles and we do not issue a recall, or if we do not do so on a timely basis, our reputation may also be harmed and we may lose future vehicle sales.

If our suppliers fail to provide us with the raw materials, systems, components and parts that we need to manufacture our automotive products, our operations may be disrupted which would have a material adverse effect on our business.

Our business depends on a significant number of suppliers, which provide the raw materials, components, parts and systems we require to manufacture vehicles and parts and to operate our business. We use a variety of raw materials in our business including steel, aluminum, lead, resin and copper, and precious metals such as platinum, palladium and rhodium. The prices for these raw materials often fluctuate. We seek to manage this exposure, but we may not always be successful in hedging these risks. See—We may be adversely affected by fluctuations in foreign currency exchange rates, commodity prices, or interest rates below. Substantial increases in the prices for our raw materials increase our operating costs and could reduce our profitability if we cannot recoup the increased costs through increased vehicle prices or offset the impact with productivity gains. In addition, raw materials are sourced from a limited number of suppliers and from a limited number of countries. We cannot guarantee that we will be able to maintain arrangements with these suppliers and ensure our access to these raw materials, and in some cases this access may be affected by factors outside of our control and the control of our suppliers.

As with raw materials, we are also at risk for supply disruption and shortages in parts and components for use in our vehicles for many reasons including, but not limited to, tight credit markets or other financial distress, natural or man-made disasters, or production difficulties. We will continue to work with our suppliers to monitor potential shortages and to mitigate the effects of any emerging shortages on our production volumes and revenues; however, there can be no assurance that these events will not have an adverse effect on our production in the future, and any such effect may be material.

Any interruption in the supply or any increase in the cost of raw materials, parts, components and systems could negatively impact our ability to achieve our vehicle sales objectives and profitability. Long-term interruptions in supply of raw materials, parts, components and systems may result in a material impact on vehicle production, vehicle sales objectives, and profitability. Cost increases which cannot be recouped through increases in vehicle prices, or countered by productivity gains, may result in a material impact on profitability.

Most of the components, parts and systems we use are sourced exclusively from a single supplier.

We rely on specific suppliers to provide certain components, parts and systems that are required to manufacture each of our vehicles, and in most circumstances we rely exclusively on one such supplier. Over the past several years, we have worked to reduce or eliminate our dependence on certain suppliers that we believed were financially at risk; however, this has increased our dependence, and the concentration of our risk, on our remaining suppliers. As volumes increase throughout the industry, some of our suppliers must make capital investments to keep pace with demand. Due to the long lead times for such investment, if our suppliers delay in making such investments or do not have sufficient access to capital, that could limit the ability of such suppliers to meet our full demands. Further, if our suppliers seek to increase prices to offset these capital investments, and we are unable to capture those additional costs through pricing on our vehicles, or counter with productivity gains, this may result in an impact on our profitability.

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Some of our third party suppliers located in Europe, or that otherwise have significant economic exposure to European markets, are experiencing financial difficulties reflecting the regional decline in general economic and industry conditions.

Some of our suppliers located in Europe, or whose customers are concentrated in Europe, are currently experiencing financial difficulties similar to those experienced in North America between 2008 and 2010 due to the combination of general economic weakness, sharply declining vehicle sales and tightened credit availability in the region. When key suppliers on which we depend have experienced financial difficulties in the past, they often sought to increase prices, accelerate payments or seek other relief. Some of those suppliers have ceased doing business or sought bankruptcy court protection. Any such actions would likely increase our costs, impair our ability to meet design and quality objectives and in some cases make it difficult or impossible for us to produce certain vehicles. We may take steps to assist key suppliers to remain in business and maintain operations, but this would require us to divert capital from other needs and adversely affect our liquidity. It may also be difficult to find a replacement supplier without significant delay or cost. As a result, we may face operational issues, including delays in vehicle production and lost sales, if any of our suppliers are unable to continue delivering supplies, which could have a material adverse effect on our business, results of operation and financial condition.

From time to time, we enter into supply arrangements that commit us to purchase minimum or fixed quantities of certain parts or materials, or to pay a minimum amount to a supplier, or “take-or-pay” contracts, through which we may incur costs that cannot be recouped by vehicles sales, increases in prices for vehicles, or countered by productivity gains.

From time to time, we enter into supply contracts that require us to purchase a minimum or fixed quantity of parts, components, or raw materials to be used in the production of our vehicles. If our need for any of these parts, components, or raw materials were to lessen, we would still be required to purchase a specified quantity of the part, component, or raw materials or pay a penalty for failure to meet the minimum purchase obligation. Additionally, we have changed the way in which we do business with certain key suppliers by paying separately and as work is completed for engineering, design and development costs, rather than embedding these costs in production component or materials pricing. We believe that this shift will help financially stabilize our suppliers, help find cost efficiency through better transparency, help ensure security of supply and encourage supplier investment in our business. However, as a result, we will now bear certain of the costs of new product development years before we will realize any revenue on that new product, which reduces our liquidity. In the event that part or component production volumes are lower than forecast, or a supplier does not meet its supply obligations, we may experience financial losses that we would not otherwise have incurred under the prior payment system.

Limitations on our liquidity and access to funding may limit our ability to execute our business plan and improve our financial condition and results of operations.

Our business is capital intensive and we require significant liquidity to support the 2010-2014 Business Plan and meet other funding requirements. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources for a more detailed discussion of our liquidity and capital requirements. In addition, during periods of vehicle sales decreases, our cash flow and liquidity may be significantly negatively impacted because we typically receive revenues from vehicle sales before we are required to pay our suppliers. Any limitations on our liquidity, due to decreases in vehicle sales, the amount of or restrictions in our existing indebtedness, conditions in the credit markets, general economic conditions or otherwise, may adversely impact our ability to execute the 2010-2014 Business Plan and improve our business, financial condition and results of operations. In addition, any actual or perceived limitations on our liquidity, or the liquidity of Fiat, may limit the ability or willingness of counterparties, including dealers, consumers, suppliers, lenders and financial service providers, to do business with us, which may adversely affect our business, financial condition and results of operations.

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Further, our operations have become significantly integrated with those of Fiat and the level of integration is expected to increase following Fiat’s acquisition in January 2014 of our equity interests that it did not already own. We rely heavily upon Fiat directly and indirectly for an array of services and products. Limitations on Fiat’s liquidity, which may be due to reduced sales of their vehicles, the amount of or restrictions in their existing indebtedness, conditions in the credit markets, general economic conditions or otherwise, could reduce Fiat’s ability to provide these services and products to us or purchase goods or services as part of a joint procurement arrangement, which could jeopardize the benefits of the Fiat-Chrysler Alliance and have a material adverse effect on our business, financial condition and results of operations.

Our ability to access funding in the event we need to increase our liquidity may be limited. For example, following our issuance of old notes totaling approximately $2.8 billion of aggregate principal amount and $2.0 billion of additional borrowings under our tranche B term loan maturing on May 24, 2017, or Tranche B Term Loan, and our new term loan credit facility, or Term Loan Credit Facility, in February 2014, any new secured financings may be constrained by market capacity and limitations in our debt agreements. In addition, subsequent to the February 2014 transactions described above, we are not permitted to increase the amount of our revolving credit facility maturing on May 24, 2016, or Revolving Facility, in an aggregate principal amount in excess of $700 million and are not permitted to issue additional first lien term loans or bonds in the U.S. Moreover, due to the significant amount of our secured debt, our access to unsecured bond financing on acceptable terms, if at all, may be limited.

Our defined benefit pension plans are currently underfunded and our pension funding obligation could increase significantly due to a reduction in funded status as a result of a variety of factors, including weak performance of financial markets, investment risks inherent in our investment portfolio, and unanticipated changes in interest rates resulting in a decrease in the value of certain plan assets or increase in the present value of plan obligations, which could have a material adverse effect on our business, financial condition and results of operations.

Our defined benefit pension plans are currently underfunded. As of December 31, 2013, our defined benefit pension plans were underfunded by approximately $5.5 billion. Our pension funding obligations may increase significantly if investment performance of plan assets does not keep pace with our benefit payment obligations and we do not make additional contributions to offset these impacts. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources —Defined Benefit Pension Plans and OPEB Plans —Contributions and Funded Status —Defined Benefit Pension Plans —Funded Status and —Critical Accounting Estimates —Pension.

Mandatory funding obligations may increase based upon lower than anticipated returns on plan assets whether as a result of overall weak market performance or particular investment decisions, changes in the level of interest rates used to determine required funding levels, changes in the level of benefits provided for by the plans, and any changes in applicable law related to funding requirements.

Our defined benefit pension plans currently hold significant investments in equity and fixed income securities, as well as investments in less liquid instruments such as private equity, real estate and certain hedge funds. Due to the complexity and magnitude of certain of our investments, additional risks may exist, including significant changes in investment policy, insufficient market capacity to complete a particular investment strategy and an inherent divergence in objectives between the ability to manage risk in the short term and our ability to quickly rebalance illiquid and long-term investments.

To determine the appropriate level of funding and contributions to our defined benefit pension plans, as well as the investment strategy for the plans, we are required to make various assumptions, including an expected rate of return on plan assets and a discount rate used to measure the obligations under our defined benefit pension plans.

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Interest rate increases generally will result in a decline in the value of investments in fixed income securities and the present value of the obligations. Conversely, interest rate decreases will generally increase the value of investments in fixed income securities and the present value of the obligations. We are required to remeasure our discount rate annually and did so at December 31, 2013. As a result of the discount rate change from December 31, 2012 to December 31, 2013, our pension obligations decreased by approximately $2.1 billion, excluding the impact of the interim remeasurement. During the second quarter of 2013, we made changes to our U.S. and Canadian salaried defined benefit pension plans that reduced our pension obligations by $218 million. These changes were made primarily to comply with Internal Revenue Service, or IRS, regulations for the U.S. salaried defined benefit plans. Any reduction in investment returns or the value of plan assets or any increase in the present value of obligations may increase our pension expenses and required contributions, and as a result constrain our liquidity and materially adversely affect our financial condition and results of operations. If we fail to make required minimum funding contributions, we could be subjected to reportable event disclosure to the Pension Benefit Guaranty Corporation, as well as interest and excise taxes calculated based upon the amount of any funding deficiency.

We may be adversely affected by fluctuations in foreign currency exchange rates, commodity prices, or interest rates.

Our manufacturing and sales operations are exposed to a variety of market risks, including the effects of changes in foreign currency exchange rates, commodity prices and interest rates. We monitor and manage these exposures as an integral part of our overall risk management program, which is designed to reduce the potentially adverse effects of these fluctuations. Nevertheless, changes in these market indicators cannot always be predicted or hedged. In addition, because of intense price competition, our significant fixed costs and our financial and liquidity restrictions, we may not be able to minimize the impact of such changes, even if they are foreseeable. As a result, substantial unfavorable changes in foreign currency exchange rates, commodity prices or interest rates could have a material adverse effect on our revenues, financial condition and results of operations.

Laws, regulations or governmental policies in foreign countries may limit our ability to access our own funds.

When we sell vehicles in countries other than the U.S., we are subject to various laws, regulations and policies regarding the exchange and transfer of funds back to the U.S., and we may be limited in our ability to transfer some or all of our funds for unpredictable periods of time. In addition, the local currency of a country may be devalued as a result of adjustments to the official exchange rate made by the government with little or no notice. For instance, we are subject to the rules and regulations of the Venezuelan government concerning our ability to exchange cash or marketable securities denominated in Venezuelan bolivar, or VEF, into USD. Under these regulations, the purchase and sale of foreign currency must be made through the Commission for the Administration of Foreign Exchange, or CADIVI, at official rates of exchange and subject to volume restrictions. These regulations limit our ability to access and transfer liquidity out of Venezuela to meet demands in other countries and also subject us to increased risk of devaluation or other foreign exchange losses. In December 2010 and February 2013, the Venezuelan government announced devaluations of the official VEF-USD exchange rate, which resulted in devaluation of our VEF denominated balances.

Our substantial indebtedness could adversely affect our financial condition, our cash flow, our ability to operate our business and could prevent us from fulfilling our obligations under the terms of our indebtedness.

We have a substantial amount of indebtedness. As of December 31, 2013, our total debt, including the debt of our subsidiaries, was $13.0 billion (based on the outstanding principal balance of such indebtedness), excluding undrawn commitments of $1.3 billion under our Revolving Facility. Although our Tranche B Term Loan and Revolving Facility, together referred to as the Senior Credit Facilities, the Secured Senior Notes Indenture (which restricts only secured debt) and our other financing arrangements restrict the incurrence of additional debt, these restrictions are subject to a number of qualifications and exceptions, which permit us to incur additional debt. The more indebted we become, the more we are exposed to the further risks associated with substantial leverage described below.

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Our debt levels and compliance with our financing agreements could have significant negative consequences, including, but not limited to:

• making it more difficult to satisfy our obligations, including our obligations with respect to the Senior Credit Facilities, Term Loan Credit Facility and our 8 percent secured senior notes due 2019 and our 8  ¹⁄₄ percent secured senior notes due 2021, collectively referred to as our Secured Senior Notes;

• diminishing our future earnings;

• limiting our ability to obtain additional financing as and when needed;

• requiring us to issue debt or raise equity or to sell some of our principal assets, possibly on unfavorable terms, to meet debt payment obligations;

• exposing us to risks that are inherent in interest rate and currency fluctuations because certain of our indebtedness bears variable rates of interest and is in various currencies;

• subjecting us to financial and other restrictive covenants, and if we fail to comply with these covenants and that failure is not waived or cured, could result in an event of default under our indebtedness;

• requiring us to devote a substantial portion of our available cash and cash flow to make interest and principal payments on our debt, thereby reducing the amount of cash available for other purposes, including for vehicle design and engineering, manufacturing improvements, other capital expenditures and other general corporate uses;

• limiting our financial and operating flexibility in responding to changing economic and competitive conditions or exploiting strategic business opportunities and increasing our vulnerability to general adverse economic and industry conditions; and

• placing us at a disadvantage compared to our competitors that have relatively less debt and may therefore be better positioned to invest their funds in design, engineering and manufacturing improvements, among other expenditures.

If our debt obligations materially hinder our ability to operate our business and adapt to changing industry conditions, we may lose market share, our revenues may decline and our operating results and financial condition may suffer. If we do not have sufficient earnings to service our indebtedness, we may be required to refinance all or part of our indebtedness, sell assets, borrow more money or sell securities, which we may not be able to do on acceptable terms if at all.

Restrictive covenants in the agreements governing our indebtedness could adversely affect our business by limiting our operating and strategic flexibility.

Our Senior Credit Agreement, Term Loan Credit Agreement, and the Secured Senior Notes Indenture, contain restrictive covenants that limit our ability to, among other things:

• incur or guarantee additional secured and unsecured indebtedness;

• pay dividends or make distributions or purchase or redeem capital stock;

• make certain other restricted payments;

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• incur liens;

• sell assets;

• enter into sale and lease-back transactions;

• enter into transactions with affiliates; and

• effect a consolidation, amalgamation or merger.

These restrictive covenants could have an adverse effect on our business by limiting our ability to take advantage of financing, mergers and acquisitions, joint ventures or other corporate opportunities. In addition, the Senior Credit Agreement and the Term Loan Credit Agreement require us to maintain a minimum ratio of borrowing base to covered debt, as well as a minimum liquidity of $3.0 billion, which includes any undrawn amounts on the Revolving Facility, and also restricts us from prepaying certain of our other indebtedness, including our Secured Senior Notes, prior to the discharge of the Senior Credit Facilities. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources for a further description of our indebtedness. Any new financing may include additional, and potentially more burdensome, covenants and restrictions on our operations and financial flexibility. Our ability to meet those financial ratios could be affected by a deterioration in our operating results, as well as by events beyond our control, including unfavorable economic conditions, and we cannot assure you that those ratios would be met. It may be necessary to obtain waivers or amendments with respect to covenants under the Secured Senior Notes Indenture, the terms of the Senior Credit Facilities and Term Loan Credit Facility, or our future indebtedness from time to time, but we cannot assure you that we will be able to obtain such waivers or amendments or the cost of obtaining such waivers. Moreover, if we are unable to comply with the terms applicable to our indebtedness, including all of the covenants under the Secured Senior Notes Indenture, the Senior Credit Agreement, the Term Loan Credit Agreement or any of our other indebtedness, we may be in default, which could result in cross-defaults under certain of our indebtedness. Upon the occurrence of an event of default under the Secured Senior Notes Indenture, the terms of the Senior Credit Agreement and the Term Loan Credit Agreement or our other indebtedness, the lenders under the Senior Credit Facilities or such other indebtedness could terminate their commitments to lend and declare all amounts outstanding under such indebtedness, together with accrued interest, to be immediately due and payable. If acceleration occurs, we may not be able to repay our debt as it is unlikely that we would be able to borrow sufficient additional funds to refinance our debt. Even if new financing is made available to us in such circumstances, it may not be available on acceptable terms. Non-compliance with our debt covenants would have a material adverse effect on our business, financial condition and results of operations.

Despite our substantial indebtedness, we may be able to incur substantially more debt.

Despite our substantial amount of indebtedness, we may be able to incur substantial additional debt, including secured debt, in the future. Although the Secured Senior Notes Indenture (in the case of secured debt), our Senior Credit Facilities, our Term Loan Credit Facility and our other financing arrangements restrict the incurrence of additional debt, these restrictions are subject to a number of qualifications and exceptions. Also, these restrictions do not prevent us from incurring obligations that do not constitute indebtedness. In addition, as of December 31, 2013, we had $1.3 billion available for additional borrowing under our Revolving Facility. The more indebtedness we incur, the further exposed we become to the risks associated with substantial leverage described above.

We may not be able to generate sufficient cash to service all of our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

Our ability to generate sufficient cash flow from operations to make scheduled payments on, or to refinance obligations under, our debt depends on our financial and operating performance, which, in turn, is subject to prevailing economic, market and competitive conditions and to financial and business-related factors, many of which may be beyond our control.

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As of December 31, 2013, we had $13.0 billion of outstanding indebtedness (based on the outstanding principal balance of such indebtedness), excluding undrawn commitments of $1.3 billion under our Revolving Facility.

If our cash flow and capital resources are insufficient to fund our debt service obligations, we may have less working capital, and we may be forced to reduce or delay capital expenditures, sell assets, seek additional equity capital or restructure all or a portion of our debt. We may not be able to complete any of these on commercially reasonable terms or at all, and even if successful, we still may be unable to meet our scheduled debt service obligations. In particular, our ability to refinance our indebtedness or obtain additional financing may be adversely affected by our high levels of debt, prevailing market conditions and the debt incurrence restrictions imposed by our debt instruments. In the absence of sufficient cash flow and capital resources, we could face substantial liquidity problems and may be required to dispose of material assets or operations to meet our debt service and other obligations. The Secured Senior Notes Indenture, the Senior Credit Agreement, the Term Loan Credit Agreement and certain other debt agreements restrict our ability to dispose of assets and the use of proceeds from any such disposition. We cannot assure you that we will be able to consummate any asset sales, or if we do, what the timing of the sales will be or whether the proceeds that we realize will be adequate to meet our debt service obligations when due or that we will be contractually permitted to apply such proceeds for that purpose. In addition, any failure to make scheduled payments of interest and principal on our outstanding indebtedness would likely result in a reduction in our credit rating, which could harm our ability to incur additional indebtedness on commercially reasonable terms, if at all. Our inability to generate sufficient cash flow to satisfy our debt obligations, or to implement any of these alternative measures, would have a material adverse effect on our business, financial condition and results of operations.

Laws, regulations and governmental policies, including those regarding increased fuel economy requirements and reduced greenhouse gas emissions, may have a significant effect on how we do business and may adversely affect our results of operations.

In order to comply with government regulations related to fuel economy and emissions standards, we must devote significant financial and management resources, as well as vehicle engineering and design attention to these legal requirements. We expect the number and scope of these regulatory requirements, along with the costs associated with compliance, to increase significantly in the future. In the U.S., for example, governmental regulation is driven by a variety of sometimes conflicting concerns, including vehicle safety, fuel economy and environmental impact (including greenhouse gas, or GHG, emissions). Complying with these regulatory requirements despite competing policy and regulatory goals could significantly affect our plans for product development, particularly our plans to further integrate product development with our parent and industrial partner, Fiat, and may result in substantial costs, including civil penalties, if we are unable to comply fully. They may also limit the types of vehicles we produce and sell and where we sell them, which can affect our vehicle sales and revenues. These requirements may also limit the benefits of the Fiat-Chrysler Alliance, as we expend financial, vehicle design and engineering resources to the localization of Fiat vehicle platforms and adapt other Fiat technologies for use in our principal markets in North America, where Fiat has had a limited presence in recent years.

Among the most significant regulatory changes we face over the next several years are the heightened requirements for fuel economy and GHG emissions restrictions. CAFE provisions under EISA mandate that, by 2025, car and truck fleet-wide average fuel economy must be materially higher than that required today. In addition, as a result of the recent revelation that certain automakers’ reported fuel economy ratings were higher than EPA verification testing showed, EPA has increased its scrutiny of all automakers’ fuel economy representations. This increased scrutiny could have an effect on the fuel economy ratings of certain of our vehicles, which, in turn, could affect our consumer perception and sales, and our ability to meet our CAFE and GHG emissions obligations in the long term.

The State of California, through the California Air Resources Board, or CARB, is implementing its own program to regulate vehicle GHG emissions that would require even further improved fuel economy. This California

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program currently has standards established for the 2009 through 2025 model years. Some additional states and Canadian provinces have also adopted the California emissions standards.

In May 2009, President Obama announced a goal of implementing harmonized federal standards for fuel economy and GHG emissions. In 2010 and 2012, EPA and NHTSA issued joint final rules to implement these new federal programs. These standards apply to passenger cars, light-duty trucks, and medium-duty passenger vehicles built in model years 2012 through 2025, and CARB has agreed that compliance with these federal emissions standards will be deemed compliance with the California emissions standards for the 2012 through 2025 model years. These light-duty standards require a car and truck fleet-wide average fuel economy of 54.5 miles per gallon by 2025. Moreover, in the absence of these harmonization rules, we would be subject to conflicting and in some cases more onerous requirements promulgated by California and adopted by other states. Implementation of these rules will require us to take costly design actions and implement vehicle technologies that may not appeal to consumers. In addition, if circumstances arise where CARB and EPA regulations regarding GHG emissions and fuel economy conflict, this too could require costly actions or limit the sale of certain of our vehicles in certain states. We could also be adversely affected if pending litigation by third parties outside of the automotive industry challenging EPA’s regulatory authority with respect to GHG emissions is successful and as a result, CARB were free to enforce its own GHG emissions standards.

We are committed to meeting these new regulatory requirements. While we believe that our current product plan will meet the applicable federal and California GHG/fuel economy standards established through model year 2016, our compliance is dependent on our ability to implement design and testing features that would generate GHG credits pursuant to EPA’s GHG rule for model years 2012 through 2016 and 2017 through 2025 on a credit carry-forward and carry-back basis. However, our current vehicle technology cannot yield the improvement in fuel efficiency necessary to achieve compliance with the requirements of the proposed 2017-2025 joint rule, and certain regulatory provisions dictate that our fleet of vehicles must be combined with the fleet of vehicles from our industrial partners Fiat Group Automobiles and Maserati S.p.A. for GHG, CAFE and zero emissions vehicle, or ZEV, purposes. These requirements may cause additional strain on our ability to comply with the applicable fuel economy, GHG standards. If the vehicles we develop to comply with these requirements are not appealing to consumers or cannot be sold at a competitive price, we may not be able to achieve the vehicle fleet mix, depending on the type and volume of our customers’ purchases, that would enable us to meet the stringent fuel economy/GHG requirements even if our long-range projection plans out a compliant path.

Canadian federal emissions regulations largely mirror the U.S. regulations.

On June 21, 2013, the Mexican Ministry of Environment and Natural Resources issued a new final GHG regulation applicable to manufacturers and importers of light-duty vehicles in Mexico. This rule is based on the model years 2012 through 2016 U.S. GHG rule described below under the captionBusiness —Environmental and Regulatory Matters —Vehicle Fuel Economy and GHG Regulation.

The European Union, or EU, promulgated new passenger car carbon dioxide, or CO_2, emissions regulations beginning in 2012. This directive sets an industry target for 2020 of a fleet average measured in grams per kilometer, with the requirements for each manufacturer calculated based on the average weight of vehicles across its fleet. In addition, some EU member states have adopted or are considering some form of CO₂-based vehicle tax, which may affect consumer preferences for certain vehicles in unpredictable ways, and which could result in specific market requirements that are more stringent than the EU emissions standards. EU sales of Chrysler Group and Fiat vehicles are “pooled” for purposes of this EU directive. However, as sales of our vehicles, which are not as CO₂ emission compliant as Fiat’s vehicles, in the EU increase due to our alliance with Fiat, the ability of the pooled fleet to comply becomes more difficult, and we may be responsible for the cost of product actions to achieve compliance if the non-compliance was our responsibility based on our agreement with Fiat.

Other countries are also developing or adopting new policies to address these issues. These policies could significantly affect our product development and international expansion plans and, if adopted in the form of new

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laws or regulations, could subject us to significant civil penalties or require that we modify our products to remain in compliance. Any such modifications may reduce the appeal of our vehicles to consumers.

Additionally, any new regulations could result in substantial increased costs, which we may be unable to pass through to consumers, and could limit the vehicles we design, manufacture and sell and limit the markets we can access. These changes could adversely affect our business, financial condition and results of operations. For example, pending litigation may prompt EPA to reexamine the use of selective catalyst reduction technology in diesel engines. Regulatory constraints on such use could adversely affect our ability to sell heavy-duty vehicles.

Safety standards set by regulatory authorities, as well as design, safety and quality ratings by widely accepted independent parties may have a significant negative effect on our costs and our vehicle sales.

Our vehicles must satisfy safety requirements that are developed and overseen by a variety of governmental bodies within the U.S. and in foreign countries. Our vehicles are also tested by independent vehicle rating programs such as the Insurance Institute for Highway Safety, or IIHS. In addition, independent ratings services such as Consumers Reports and J.D. Power perform reviews on safety, design and quality, which often influence consumers’ purchase decisions.

Meeting or exceeding government-mandated safety standards and improving independent safety, design and quality ratings can be difficult and costly. Often, safety requirements or desired quality and design attributes hinder our efforts to meet emissions and fuel economy standards, since the latter are often facilitated by reducing vehicle weight. The need to meet regulatory or other generally accepted rating standards can substantially increase costs for product development, testing and manufacturing, particularly if new requirements or testing standards are implemented in the middle of a product cycle, and the vehicle does not already meet the new requirements or standards.

To the extent that the ratings of independent parties are negative, or are below our competitors’ ratings, our vehicle sales may be negatively impacted.

We are exposed to ongoing litigation and other legal and regulatory actions and risks in the ordinary course of our business, and we could incur significant liabilities and substantial legal fees.

In the ordinary course of business, we face a significant volume of litigation as well as other legal claims and proceedings and regulatory enforcement actions. The results of these legal proceedings cannot be predicted with certainty, and adverse results in current or future legal proceedings may materially harm our business, financial condition and results of operations, whether because of significant damage awards or injunctions or because of harm to our reputation and market perception of our vehicles and brands. We may incur losses in connection with current or future legal proceedings that exceed any provisions we may have set aside in respect of such proceedings or that exceed any applicable insurance coverage.

Although we design and develop vehicles to comply with all applicable safety standards, compliance with governmental standards does not necessarily prevent individual or class action lawsuits, which can entail significant costs and risks. For example, whether FMVSS preempt state common law claims is often a contested issue in litigation, and courts may find us in breach of legal duties and liable in tort, even though our vehicles comply with all applicable federal and state regulations. Furthermore, simply responding to actual or threatened litigation or government investigations regarding our compliance with regulatory standards, even in cases in which no liability is found, often requires significant expenditures of funds, time and other resources, and may cause reputational harm. Any insurance we hold currently may not be available when costs arise in the future and, in the case of harm caused by a component sourced from a supplier, the supplier may no longer be available to provide indemnification or contribution.

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In addition, our vehicles may have “long-tail” exposures, including as a result of potential product recalls and product liability claims, giving rise to liabilities many years after their sale. For instance, NHTSA has indicated that it will request a safety recall where it sees an unreasonable disparity in vehicle performance or later adoption of evolving technology or design standards as compared to other vehicles in the market even though the subject vehicles met applicable standards when sold.

Taxing authorities could challenge our historical and future tax positions as well as our allocation of taxable income among our subsidiaries and affiliates.

The amount of income tax we pay is subject to our interpretation of applicable tax laws in the jurisdictions in which we file. We have taken, and will continue to take, appropriate tax positions based on our interpretation of such tax laws. While we believe that we have complied with all applicable income tax laws, there can be no assurance that a taxing authority will not have a different interpretation of the law and assess additional taxes. Should additional taxes be assessed, this may have a material adverse effect on our results of operations and financial condition.

We conduct sales, contract manufacturing, marketing, distribution and research and development operations with affiliated companies located in various tax jurisdictions around the world. While our transfer pricing methodologies are based on economic studies that we believe are reasonable, the transfer prices for these products and services could be challenged by the various tax authorities resulting in additional tax liabilities, interest and/or penalties, and the possibility of double taxation. To reduce the risk of transfer pricing adjustments, the Company entered into an advanced pricing agreement, or APA, with Canada that is applicable through 2014. We intend to seek an extension to the Canadian APA but there can be no assurance that we will obtain such an extension.

Our collective bargaining agreements limit our ability to modify our operations and reduce costs in response to market conditions.

Substantially all of our hourly employees in the U.S. and Canada are represented by unions and covered by collective bargaining agreements. We negotiated a new collective bargaining agreement with the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, or the UAW, in 2011 and with the National Automobile, Aerospace, Transportation and General Workers Union of Canada, or the CAW (now part of Unifor), in 2012. While the UAW has agreed to certain commitments to continue to support the industrial operations and business plans of Chrysler Group and the further implementation of the Fiat-Chrysler Alliance, including in the continued roll-out of WCM programs, there can be no assurance that these commitments will enable us to achieve our goals. As a practical matter, both of our collective bargaining agreements restrict our ability to modify our operations and reduce costs quickly in response to changes in market conditions during the terms of the agreements. These and other provisions in our collective bargaining agreements may impede our ability to restructure our business successfully to compete more effectively, especially with those automakers whose employees are not represented by unions.

Work stoppages at our facilities and work stoppages at our suppliers’ facilities which result in interruptions of production may harm our business.

A work stoppage or other interruption of production could occur at our facilities or those of our suppliers as a result of disputes under existing collective bargaining agreements with labor unions, or in connection with negotiations of new collective bargaining agreements, or as a result of supplier financial distress. A work stoppage or interruption of production at our facilities or those of our suppliers due to labor disputes could negatively impact our ability to achieve vehicles sales objectives and profitability. Long-term interruptions in production which cannot be countered by productivity gains may result in a material impact on vehicle sales, liquidity and profitability.

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We depend on our information technology and data processing systems to operate our business, and a significant malfunction or disruption in the operation of our systems, or a security breach that compromises the confidential and sensitive information stored in those systems, could disrupt our business and adversely impact our ability to compete.

Our ability to keep our business operating effectively depends on the functional and efficient operation of our legacy and telecommunications systems, including our vehicle design, manufacturing, inventory tracking and billing and collection systems. We rely on these systems to make a variety of day-to-day business decisions as well as to track transactions, billings, payments and inventory. Such systems are susceptible to malfunctions and interruptions due to equipment damage, power outages, and a range of other hardware, software and network problems. Those systems are also susceptible to cybercrime, or threats of intentional disruption, which are increasing in terms of sophistication and frequency. For any of these reasons, we may experience systems malfunctions or interruptions. Although our systems are diversified, including multiple server locations and a range of software applications for different regions and functions, and we are currently undergoing an effort to assess and ameliorate risks to our systems, a significant or large-scale malfunction or interruption of our computer or data processing systems could adversely affect our ability to manage and keep our operations running efficiently, and damage our reputation if we are unable to track transactions and deliver products to our dealers and customers. A malfunction that results in a wider or sustained disruption to our business could have a material adverse effect on our business, financial condition and results of operations.

We are currently in the process of transitioning, retiring or replacing a significant number of our software applications at an accelerated rate, an effort that will continue in future years. These applications include, among others, our engineering, finance, procurement and communication systems. During the transition periods, and until we fully migrate to our new systems, we may experience material disruptions in communications, in our ability to conduct our ordinary business processes and in our ability to report the results of our operations. Though we are taking commercially reasonable steps to transition our data properly and to assess and minimize risk during this process, we may lose significant data in the transition, or we may be unable to access data for periods of time without forensic intervention. Loss of data may affect our ability to continue ongoing business processes according to the dates in the 2010-2014 Business Plan, or could affect our ability to file timely reports required by a wide variety of regulators, including the U.S. Securities and Exchange Commission, or SEC. Our ability to comply with the requirements of the Sarbanes-Oxley Act, to the extent required of us, may also be compromised.

In addition to supporting our operations, we use our systems to collect and store confidential and sensitive data, including information about our business, our customers and our employees. As our technology continues to evolve, we anticipate that we will collect and store even more data in the future, and that our systems will increasingly use remote communication features that are sensitive to both willful and unintentional security breaches. Much of our value is derived from our confidential business information, including vehicle design, proprietary technology and trade secrets, and to the extent the confidentiality of such information is compromised, we may lose our competitive advantage and our vehicle sales may suffer. We also collect, retain and use personal information, including data we gather from customers for product development and marketing purposes, and data we obtain from employees. In the event of a breach in security that allows third parties access to this personal information, we are subject to a variety of ever-changing laws on a global basis that require us to provide notification to the data owners, and that subject us to lawsuits, fines and other means of regulatory enforcement. Our reputation could suffer in the event of such a data breach, which could cause consumers to purchase their vehicles from our competitors. Ultimately, any compromise in the integrity of our data security could have a material adverse effect on our business.

We may not be able to adequately protect our intellectual property rights, which may harm our business.

Our success depends, in part, on our ability to protect our intellectual property rights. If we fail to protect our intellectual property rights, others may be able to compete against us using intellectual property that is the same

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as or similar to our own. In addition, we cannot assure you that our intellectual property rights are sufficient to provide us with a competitive advantage against others who offer products similar to ours.

We rely upon a combination of patent, trademark, copyright and trade secret law to protect our intellectual property rights, all of which provide limited protection. However, we cannot assure you that any patents will be issued from pending or future applications or that any issued patents will provide us with a competitive advantage or will not be challenged, invalidated or circumvented. We also cannot assure you that we will obtain any copyright or trademark registrations from pending or future applications or that any of our copyrights or trademarks will be enforceable. We rely in some circumstances on trade secrets to protect our technology. However, trade secrets may lose their value if not properly protected. Adequate remedies may not be available in the event of the disclosure of our trade secrets and the unauthorized use of our technology.

Despite our efforts, we may be unable to prevent third parties from infringing our intellectual property and using our technology for their competitive advantage. Any such infringement and use could adversely affect our business, financial condition or results of operations. Monitoring our intellectual property rights to detect infringement can be difficult and costly, and enforcement of our intellectual property rights may require us to bring legal action. Any such litigation could be costly and time-consuming, and the result of any litigation is uncertain.

Our intellectual property is also used in a large number of foreign countries, and, in connection with the Fiat-Chrysler Alliance, we are seeking to expand our operations overseas. The laws of some countries do not offer the same protection of our intellectual property rights as do the laws of the U.S. In addition, effective intellectual property enforcement may be unavailable or limited in certain countries, making it difficult for us to protect our intellectual property from misuse or infringement there. We expect differences in intellectual property laws and enforcement to become a greater problem for us as our licensees increase their manufacturing and sales outside of the U.S. Our inability to protect our intellectual property rights in some countries may harm our business, financial condition or results of operations.

We depend on the services of our key executives, the loss of whose skills could materially harm our business. Also, we are in the process of hiring additional employees, and we may encounter difficulties with hiring sufficient employees with critical skills, particularly in competitive specialties such as vehicle design and engineering.

Several of our senior executives, including our Chief Executive Officer, Sergio Marchionne, are important to our success because they have been instrumental in establishing our new strategic direction and implementing the 2010-2014 Business Plan. If we were to lose the services of any of these individuals this could have a material adverse effect on our business, financial condition and results of operations. We believe that these executives, in particular Mr. Marchionne, could not easily be replaced with executives of equivalent experience and capabilities. We do not have a specified allocation of required time and attention for Mr. Marchionne and certain other members of management, including our Chief Financial Officer. If any of them allocates more of their time and attention to non-Chrysler matters, our business, financial condition and results of operations may suffer.

In addition, we are currently seeking to hire employees in a number of critical areas, including vehicle design and engineering. We have experienced some difficulties in hiring and retaining highly skilled employees, particularly in competitive specialties, and we may experience such difficulties going forward. Due to the potential lack of critical skills in our employee population, we may not be able to achieve the 2010-2014 Business Plan targets in as cost-effective or efficient a manner as we have projected.

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Failure to maintain adequate financial and management processes and controls could lead to errors in our financial reporting, which could harm our business and cause a default under certain covenants in the Senior Credit Agreement, the Term Loan Credit Agreement and the Secured Senior Notes Indenture.

Our anticipated growth is likely to place a considerable strain on our financial and management systems, processes and controls, as well as on our personnel. We continuously monitor and evaluate changes in our internal control over financial reporting. In connection with the Fiat-Chrysler Alliance, and in support of our drive toward common global systems, we are replacing our current finance, procurement, and capital project and investment management systems with a SAP system that was developed leveraging the SAP system Fiat currently utilizes. Our new system is being implemented in two phases. The first phase was implemented as of January 2013 and we began utilizing this system to record and report our 2013 financial results. The second phase of implementation began in January 2014. As appropriate, we continue to modify the design and documentation of internal control processes and procedures relating to the new systems to simplify and automate many of our previous processes. Our management believes that the implementation of this system will continue to improve and enhance our internal controls over financial reporting.

In addition, if we do not maintain adequate financial and management personnel, processes and controls, we may not be able to accurately report our financial performance on a timely basis, which could cause a default under certain covenants in the Senior Credit Agreement, the Term Loan Credit Agreement and the Secured Senior Notes Indenture.

Risks Related to Our Structure, the Notes and the Exchange Offers

There may be adverse consequences if you do not exchange your old notes.

If you do not exchange your old notes for Notes in the exchange offers, you will continue to be subject to restrictions on transfer of your old notes as set forth in the Offering Memorandum distributed in connection with the private offering of the old notes. In general, the old notes may not be offered or sold unless they are registered or exempt from registration under the Securities Act and applicable state securities laws. Except as required by the registration rights agreement, dated as of February 7, 2014, with the initial purchasers of the old notes, or the Registration Rights Agreement, we do not intend to register resales of the old notes under the Securities Act. You should refer toSummary —The Exchange OffersandThe Exchange Offers for information about how to tender your old notes.

The tender of old notes under the exchange offers will reduce the outstanding amount of the old notes, which may have an adverse effect upon, and increase the volatility of, the market prices of the old notes due to a reduction in liquidity.

The Notes will mature later than a substantial portion of our other indebtedness, including the Senior Credit Facilities and Term Loan Credit Facility.

The 2019 Notes will mature in 2019 and the 2021 Notes will mature in 2021. Substantially all of our existing indebtedness will mature prior to the maturity of the Notes. For example, the Tranche B Term Loan will mature two years before the 2019 Notes and four years before the 2021 Notes and the term loans under the new Term Loan Credit Agreement will mature approximately six months before the 2019 Notes and approximately two years and six months before the 2021 Notes. In addition, the Revolving Facility will mature three years before the 2019 Notes and five years before the 2021 Notes. Therefore, we will be required to repay a substantial portion of our other indebtedness, including the Senior Credit Facilities and Term Loan Credit Facility, before the Notes, which may significantly deplete the amount of our cash available to repay the Notes at maturity. There can be no assurance that we will have the ability to borrow or otherwise raise the amounts necessary to repay such amounts if our cash flow is insufficient, and the prior maturity of such other indebtedness may make it difficult to refinance the Notes.

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Holders of the Notes will not control decisions regarding collateral.

The rights of holders of the Notes with respect to the collateral securing the First-Priority Lien Obligations and the Notes will be limited pursuant to the terms of an intercreditor agreement with the lenders under our Senior Credit Facilities and the Term Loan Credit Facility, or the Intercreditor Agreement. Under the Intercreditor Agreement, any actions that may be taken in respect of the collateral (including the ability to commence enforcement proceedings against the collateral and to control the conduct of such proceedings, and to approve amendments to, releases of the collateral from the lien of, and waivers of past defaults under, the collateral documents) will be at the direction of the lenders under our Senior Credit Facilities and Term Loan Credit Facility. Under those circumstances, neither the collateral agent nor the trustee on behalf of the holders of the Notes, with limited exceptions, will have the ability to control or direct such actions, even if the rights of the holders of the Notes are adversely affected. Any release by the lenders under our Senior Credit Facilities and Term Loan Credit Facility of the collateral that secures the Senior Credit Facilities and Term Loan Credit Facility (other than in connection with a termination of the Senior Credit Facilities and the Term Loan Credit Facility or a release of all collateral) will also release the junior-priority lien securing the Notes on the same collateral (subject to the interest of the holders of the Notes in the proceeds of that collateral), and holders of the Notes will have no control over such release. In addition, because the holders of the First-Priority Lien Obligations control the disposition of the collateral, such holders could decide not to proceed against such collateral, regardless of whether there is a default under the documents governing such indebtedness or under the Secured Senior Notes Indenture. In such event, the only remedy available to the holder of the Notes would be to sue for payment on the Notes and the related guarantees.

The Secured Senior Notes Indenture and the Intercreditor Agreement also contain provisions prohibiting the trustee and the collateral agent from objecting following the filing of a bankruptcy petition to a number of important matters regarding the collateral and the financing to be provided to us. After such filing, the value of this collateral could materially deteriorate and holders of the Notes would be unable to raise an objection. In addition, the Intercreditor Agreement gives the holders of the First-Priority Lien Obligations the right to access and use the collateral that will secure the Notes to allow those holders to protect such collateral and to process, store and dispose of the collateral.

The collateral will also be subject to any and all exceptions, defects, encumbrances, liens and other imperfections as may be accepted by the lenders under our Senior Credit Facilities, Term Loan Credit Facility and other creditors that have the benefit of senior liens on such collateral from time to time, whether on or after the date the Notes and related guarantees are issued. The existence of any such exceptions, defects, encumbrances, liens and other imperfections could adversely affect the value of the collateral securing the Notes as well as the ability of the collateral agent to realize or foreclose on such collateral.

Furthermore, the security documents generally allow us and our subsidiaries to remain in possession of, retain exclusive control over, to freely operate, and to collect, invest and dispose of any income from, the collateral securing the Notes. In addition, to the extent we sell any assets that constitute collateral, the proceeds from such sale will be subject to the junior-priority lien securing the Notes only to the extent such proceeds would otherwise constitute “collateral” securing the Notes under the security documents. To the extent the proceeds from any such sale of collateral do not constitute “collateral” under the security documents, the pool of assets securing the Notes would be reduced and the Notes would not be secured by such proceeds.

In addition, the collateral will be taken in the name of a collateral agent for the benefit of the holders of the Notes and the trustee. As a result, the collateral agent or representative of the collateral agent may effectively control actions with respect to collateral which may impair the rights that a noteholder would otherwise have as a secured creditor. The collateral agent or representative, as applicable, may take actions that a noteholder disagrees with or fail to take actions that a noteholder wishes to pursue. For example, the collateral agent or representative, as applicable, could decide to credit bid using the value of a noteholder’s secured claim even if such noteholder would not individually have done so. Furthermore, the collateral agent or representative under

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the Intercreditor Agreement may fail to act in a timely manner which could impair the recovery of noteholders. In addition, the collateral agent for the holders of the Notes will be the same as one of the collateral agents under the Senior Credit Facilities and the Term Loan Credit Facility. As such, in the event of a default the collateral agent will have a conflict of interest. If the collateral agent for the holders of the Notes is not able to remove the conflict of interest, it will need to resign.

There may not be sufficient collateral to satisfy our obligations under the Notes, and the collateral securing the Notes may be diluted under certain circumstances.

The Notes are secured by a junior priority lien on the collateral that secures the Senior Credit Facilities and the Term Loan Credit Facility. In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against us or any current or future domestic subsidiary, the assets that are pledged as shared collateral securing the First-Priority Lien Obligations and the Notes must be used first to pay the First-Priority Lien Obligations in full before making any payments on the Notes. As of December 31, 2013, we had $13.0 billion of indebtedness (based on the outstanding principal balance of such indebtedness), and after giving effect to the following three transactions, which we refer to as the Refinancing Transactions, including (i) the offering of the old notes, (ii) the $2.0 billion of additional senior secured borrowings under our Tranche B Term Loan and Term Loan Credit Facility and (iii) the use of proceeds from these financing activities to repay in full a senior unsecured note that we issued on June 10, 2009 to the UAW Retiree Medical Benefits Trust, or the VEBA Trust Note, we did not have a significant change in the outstanding principal balance of such indebtedness. In addition, the Secured Senior Notes Indenture allows a significant amount of additional indebtedness and other obligations to be secured by a lien on the collateral securing the Notes on a senior or equal and ratable basis, provided that, in each case, such indebtedness or other obligations could be incurred under the lien incurrence covenant contained in the indenture. Any additional obligations secured by a lien on the collateral securing the Notes (whether senior to or equal with the lien securing the Notes) will adversely affect the relative position of the Notes with respect to the collateral securing the Notes and your rights would be diluted by any such increase in the obligations secured by such collateral.

Much of our assets are not and will not be collateral for the Notes. The assets that are and will be excluded from the collateral include all assets of our foreign subsidiaries, which subsidiaries are permitted to incur substantial indebtedness in compliance with the covenants under the Senior Credit Facilities, the Term Loan Credit Facility and the Secured Senior Notes Indenture. As of December 31, 2013, after giving effect to the Refinancing Transactions and the $1.9 billion special distribution paid by the Company to its members as part of Fiat North America LLC’s acquisition of the UAW Retiree Medical Benefits Trust’s equity interest in the Company, our non-guarantor subsidiaries would have had approximately $13.6 billion of total assets and approximately $8.9 billion of total liabilities (including trade payables) to which the Notes are structurally subordinated. With respect to those assets that are not part of the collateral securing the Notes but which secure other obligations, the Notes are effectively junior to these obligations to the extent of the value of such assets. There is no requirement that the holders of the First-Priority Lien Obligations first look to these excluded assets before foreclosing, selling or otherwise acting upon the collateral shared with the Notes.

No appraisals of the fair market value of any assets that are collateral were prepared in connection with the offering of old notes in February 2014 or have been prepared in connection with this offering of Notes. The value of the collateral at any time will depend on market and other economic conditions, including the availability of suitable buyers for the collateral. The book value of our assets may not be indicative of the fair market value of such assets, which could be substantially lower. By their nature, some or all of the pledged assets may be illiquid and may have no readily ascertainable market value or market. The value of the assets pledged as collateral for the Notes or our other secured indebtedness could be impaired in the future as a result of changing economic conditions, changing legal regimes, our failure to implement our business strategy, competition and other future trends. In the event of a foreclosure, liquidation, bankruptcy or similar proceeding, the proceeds from any sale or liquidation of the collateral may be insufficient to pay our obligations under the Notes in full or at all.

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Some foreign jurisdictions may not recognize the enforceability of junior liens, which may result in the Notes having a less expansive security package than the Senior Credit Facilities and Term Loan Credit Facility.

Some jurisdictions in which our subsidiaries are located, including Brazil, Germany, Korea, the Netherlands, Russia and South Africa, may not recognize the validity or enforceability of a junior lien, or allow the perfection of a junior lien. If that is the case, the holders of the Notes, unlike the lenders under our Senior Credit Facilities and Term Loan Credit Facility, may not have the benefit of an enforceable security interest in the stock of our subsidiaries located in those jurisdictions.

The value of the collateral securing the Notes may not be sufficient to secure post-petition interest.

In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against any issuer, guarantor or security provider, holders of the Notes will only be entitled to post-petition interest under the U.S. federal bankruptcy code to the extent that the value of their security interest in the collateral is greater than their pre-bankruptcy claim. Holders of the Notes may be deemed to have an unsecured claim to the extent that our obligations in respect of the Notes exceed the fair market value of the collateral securing the Notes. As a result, holders of the Notes that have a security interest in collateral with a value equal to or less than their pre-bankruptcy claim will not be entitled to post-petition interest under the bankruptcy code. In addition, it is possible that the bankruptcy trustee, the debtor-in-possession or competing creditors will assert that the fair market value of the collateral with respect to the Notes on the date of the bankruptcy filing was less than the then-current principal amount of the Notes. Upon a finding by a bankruptcy court that the Notes are under-collateralized, the claims in the bankruptcy proceeding with respect to the Notes would be bifurcated between a secured claim and an unsecured claim, and the unsecured claim would not be entitled to the benefits of security in the collateral. Other consequences of a finding of under-collateralization would be, among other things, a lack of entitlement on the part of the Notes to receive post-petition interest and a lack of entitlement on the part of the unsecured portion of the Notes to receive other “adequate protection” under U.S. federal bankruptcy laws. In addition, if any payments of post-petition interest had been made at the time of such a finding of under-collateralization, those payments could be re-characterized by the bankruptcy court as a reduction of the principal amount of the secured claim with respect to the Notes. No appraisal of the fair market value of the collateral has been prepared in connection with the exchange offers and we therefore cannot assure you that the value of the noteholders’ interest in the collateral equals or exceeds the principal amount of the Notes.

There are circumstances other than repayment or discharge of the Notes under which the collateral and related guarantees will be released automatically, without the consent of the holders of the Notes, the collateral agent or the trustee under the Secured Senior Notes Indenture.

Under various circumstances, collateral securing the Notes may be released automatically, including:

• if all other liens on such property or assets securing First-Priority Lien Obligations are released;

• a sale, transfer or other disposal of such collateral in a transaction not prohibited under the Secured Senior Notes Indenture, Senior Credit Facilities or Term Loan Credit Facility, including the sale of any entity in its entirety that owns or hold such collateral;

• with respect to collateral held by a guarantor, upon the release of such guarantor from its guarantee;

• with respect to collateral that is capital stock, upon the dissolution of the issuer of such capital stock in accordance with the Secured Senior Notes Indenture;

• with respect to any collateral, upon any release by the lenders under our Senior Credit Facilities or Term Loan Credit Facility of their senior-priority security interest in such collateral; and

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• with respect to any collateral, upon the Notes obtaining an investment grade rating from both Moody’s and Standard & Poor’s for 60 consecutive days so long as no event of default has occurred and is continuing.

Moreover, as described below, although the Notes will initially be secured by the pledge of the capital stock of certain of our subsidiaries, the pledge of any such subsidiary will be released to the extent that separate financial statements of the subsidiary would be required pursuant to Rule 3-16 of Regulation S-X under the Securities Act in connection with the filing of a registration statement related to the Notes.

In addition, the guarantee of a guarantor will be released in connection with a sale of such guarantor in a transaction not prohibited by the indenture. The Secured Senior Notes Indenture also permits us to designate one or more of our restricted subsidiaries that is a guarantor of the Notes as an unrestricted subsidiary. If we designate a guarantor as an unrestricted subsidiary, all of the liens on any collateral owned by such subsidiary or any of its subsidiaries and any guarantees of the Notes by such subsidiary or any of its subsidiaries will be released under the Secured Senior Notes Indenture but not under our Senior Credit Facilities and Term Loan Credit Facility. Designation of an unrestricted subsidiary will reduce the aggregate value of the collateral securing the Notes to the extent that liens on the assets of the unrestricted subsidiary and its subsidiaries are released. In addition, the creditors of the unrestricted subsidiary and its subsidiaries will have a senior claim on the assets of such unrestricted subsidiary and its subsidiaries. SeeDescription of the Notes.

Many of the covenants in the indenture that will govern the Notes will not apply if the Notes are rated investment grade by Moody’s and Standard & Poor’s.

If the Notes are assigned an investment grade rating by both Moody’s and Standard & Poor’s for 60 consecutive days, and no event of default has occurred and is continuing, many of the covenants in the Secured Senior Notes Indenture will not apply to us and the liens on the collateral will be automatically released. There can be no assurance that the Notes will ever be rated investment grade, or that if they are rated investment grade, that the Notes will maintain these ratings. However, if the Notes do achieve investment grade ratings and the covenants are terminated and the collateral is released, the Notes will still only benefit from the limited covenants and be without the benefit of the guarantees or the collateral even if the Notes subsequently lose their investment grade ratings after such date. For additional information seeDescription of the Notes —Certain Covenants in the Indenture —Covenant Fall-Away.

Termination of some of the covenants in the indenture that will govern the Notes, however, would allow us to engage in certain transactions that would not be permitted while these covenants were in force. In addition, if the Notes are rated investment grade the liens on the collateral will be automatically released. In addition, upon the termination of these covenants, any defaults with respect to such terminated covenants that have not matured into events of default will be rescinded. For additional information, seeDescription of the Notes —Certain Covenants in the Indenture —Covenant Fall-Away.

Because each guarantor’s liability under its guarantee or security may be reduced to zero, avoided or released under certain circumstances, you may not receive any payments from some or all of the guarantors.

Noteholders have the benefit of the guarantees of certain of our subsidiaries. However, the guarantees are limited to the maximum amount that the guarantors are permitted to guarantee under applicable law. As a result, a guarantor’s liability under its guarantee could be reduced to zero, depending on the amount of other obligations of such guarantor. Furthermore, under the circumstances discussed more fully below, a court under applicable fraudulent conveyance and transfer statutes could void the obligations under a guarantee or further subordinate it to all other obligations of the guarantor. In addition, you will lose the benefit of a particular guarantee if it is released under certain circumstances described underDescription of the Notes —Security —Releases of Collateral.

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The pledge of the securities of our subsidiaries that secures the Notes will automatically be released to the extent and for so long as that pledge would require the filing of separate financial statements with the SEC for that subsidiary.

The Notes are secured by a pledge of the stock and other securities of certain of our subsidiaries held by the issuers or the guarantors. Under applicable SEC regulations, if the par value, book value as carried by us or market value (whichever is greatest) of the capital stock, other securities or similar items of a subsidiary pledged as part of the collateral is greater than or equal to 20 percent of the aggregate principal amount of the Notes then outstanding, such a subsidiary would be required to provide separate financial statements to the SEC. The Secured Senior Notes Indenture provides that any capital stock and other securities of any of our subsidiaries will be excluded from the collateral for so long as the pledge of such capital stock or other securities to secure the Notes would cause such subsidiary to be required to file separate financial statements with the SEC pursuant to Rule 3-16 of Regulation S-X or another similar rule. We conduct a substantial portion of our business through our subsidiaries, many of which have capital stock with a value in excess of 20 percent of the aggregate principal amount of the Notes. Accordingly, the pledge of stock and securities with respect to each such subsidiary will be limited in value to less than 20 percent of the aggregate principal amount of the Notes. As a result, holders of the Notes could lose a portion or all of their security interest in the capital stock or other securities of those subsidiaries during that period. It may be more difficult, costly and time-consuming for holders of the Notes to foreclose on the assets of a subsidiary than to foreclose on its capital stock or other securities, so the proceeds realized upon any such foreclosure could be significantly less than those that would have been received upon any sale of the capital stock or other securities of such subsidiary. In addition, the lenders under the Senior Credit Facilities and Term Loan Credit Facility are not subject to such limitation and may have a substantially more valuable security interest and different interests as a result thereof. There is no requirement that the lenders under the Senior Credit Facilities and Term Loan Credit Facility first look to the securities that are not pledged to secure the Notes before foreclosing, selling or otherwise acting upon the collateral shared with the Notes.

We may not be able to repurchase Notes upon a change of control.

The term “change of control” as used in the Secured Senior Notes Indenture is limited in terms of its scope and does not include every event that might adversely affect the value of the Notes. The change of control provisions may not protect you if we undergo a highly leveraged transaction, reorganization, restructuring, acquisition or similar transaction unless such transaction is included within the definition of a change of control, notwithstanding the fact that such events could increase the level of our indebtedness or otherwise adversely affect our capital structure, credit ratings or the value of the Notes. Furthermore, we are required to repurchase the Notes following a change of control only if, within a specified time period following public notice of a proposed change of control transaction, the rating of the Notes by either Standard & Poor’s or Moody’s is reduced by at least one notch in the gradation of the ratings scale.

The source of funds for any purchase of the Notes will be our available cash or cash generated from our and our subsidiaries’ operations or other sources, including borrowings, sales of assets or sales of equity. We may not be able to repurchase the Notes upon a change of control because we may not have sufficient financial resources to purchase all of the Notes that are tendered upon a change of control and to repay our other indebtedness that will become due. We may require additional financing from third parties to fund any such purchases, and we cannot assure you that we would be able to obtain financing on satisfactory terms, or at all. Our failure to repurchase the Notes upon a change of control would cause a default under the Secured Senior Notes Indenture. Such a default would, in turn, constitute a default under our Senior Credit Facilities and Term Loan Credit Facility. In order to avoid the obligations to repurchase the Notes, we may have to avoid certain change in control transactions that would otherwise be beneficial to the Company.

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Not all of our subsidiaries guarantee the Notes, and the Notes and the guarantees of the Notes are structurally subordinated to all of the claims of creditors of those non-guarantor subsidiaries, which includes all of our non-U.S. subsidiaries. In addition, the Notes and the guarantees of the Notes, are only secured by a limited pledge of certain of such foreign subsidiaries’ capital stock, with no pledge of the assets of any non-U.S. subsidiaries of us or our U.S. subsidiaries.

The Notes are structurally subordinated to indebtedness and other liabilities of our subsidiaries that do not guarantee the Notes. The Notes are guaranteed by each of our domestic subsidiaries that also guarantee the Senior Credit Facilities and Term Loan Credit Facility. The Notes are not and will not be guaranteed by any of our non-U.S. subsidiaries. In the future, other subsidiaries will be required to guarantee the Notes only under certain limited circumstances. SeeDescription of the Notes —Certain Covenants in the Indenture —Future Guarantors. Our non-guarantor subsidiaries accounted for approximately $40.7 billion of our revenues, net, including intercompany transactions, and approximately $1.9 billion of our Modified EBITDA, in each case, for the year ended December 31, 2013. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Non-GAAP Financial Measures for descriptions of our Non-GAAP financial measures. As of December 31, 2013, our non-guarantor subsidiaries accounted for approximately $13.6 billion of our total assets, and had approximately $8.9 billion of total liabilities (including trade payables) to which the Notes are structurally subordinated. In addition, these non-guarantor subsidiaries will be permitted to incur substantial indebtedness in compliance with the covenants under the Senior Credit Facilities, Term Loan Credit Facility and the Secured Senior Notes Indenture. Generally, claims of creditors (both secured and unsecured) of a non-guarantor subsidiary, including trade creditors and claims of preference shareholders (if any) of the subsidiary will have priority with respect to the assets and cash flow of the non-guarantor subsidiary over the claims of creditors of its parent entity. In the event of a bankruptcy, liquidation or reorganization of any of our non-guarantor subsidiaries, these non-guarantor subsidiaries will pay the holders of their debts, holders of preferred equity interests and their trade creditors before they will be able to distribute any of their assets to us and the holders of the Notes will participate with all other holders of our indebtedness in the assets remaining and distributed or otherwise paid to us after the subsidiaries involved in such proceedings have paid all of their debts and liabilities. In any of these cases, the relevant subsidiaries may not have sufficient funds to make payments to us, and holders of the Notes may receive less, ratably, than the holders of debt of our non-guarantor subsidiaries.

In addition, with respect to the Notes, the pledge of the equity of any first tier non-U.S. subsidiaries of us and our U.S. subsidiaries is limited to 100 percent of their non-voting capital stock and 65 percent of their voting capital stock, subject to certain limited exceptions. There will be no pledge of the capital stock of non-U.S. subsidiaries of us and our U.S. subsidiaries other than first-tier non-U.S. subsidiaries. The Notes are not and will not be secured by a pledge of the assets of any non-U.S. subsidiary of us or our U.S. subsidiaries.

Rights of holders of the Notes in the collateral may be adversely affected by bankruptcy proceedings in the United States.

The right of the collateral agent or its representative to repossess and dispose of the collateral securing the Notes upon acceleration is likely to be significantly impaired by U.S. federal bankruptcy law if bankruptcy proceedings are commenced by or against us prior to or possibly even after the collateral agent has repossessed and disposed of the collateral. Under the U.S. bankruptcy code, a secured creditor, such as the collateral agent, is prohibited from repossessing its security from a debtor in a bankruptcy case, or from disposing of security repossessed from a debtor, without bankruptcy court approval. Moreover, U.S. bankruptcy law permits the debtor to continue to retain and to use collateral, and the proceeds, products, rents or profits of the collateral, even though the debtor is in default under the applicable debt instruments, provided that the secured creditor is given “adequate protection.” The meaning of the term “adequate protection” may vary according to circumstances, but it is intended in general to protect the value of the secured creditor’s interest in the collateral and may include cash payments or the granting of additional security, if and at such time as the court in its discretion determines, for any diminution in the value of the collateral as a result of the stay of repossession or disposition or any use of the collateral by the debtor during the pendency of the bankruptcy case. In view of the broad discretionary powers of

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a bankruptcy court, it is impossible to predict how long payments under the Notes could be delayed following commencement of a bankruptcy case, whether or when the collateral agent would repossess or dispose of the collateral, or whether or to what extent holders of the Notes would be compensated for any delay in payment of loss of value of the collateral through the requirements of “adequate protection.”

U.S. federal and state fraudulent transfer laws permit a court to void the Notes and the guarantees and security interests, and, if that occurs, you may not receive any payments on the Notes or may be required to return payments made on the Notes.

The issuance of the Notes, the guarantees and the security interests may be subject to review under U.S. federal and state fraudulent transfer and conveyance statutes if a bankruptcy, liquidation or reorganization case or a lawsuit, including under circumstances in which bankruptcy is not involved, were commenced at some future date by us, by the guarantors or on behalf of our unpaid creditors or the unpaid creditors of a guarantor. While the relevant laws may vary from state to state, under such laws the payment of consideration in certain transactions could be considered a fraudulent conveyance if (1) the consideration was paid with the intent of hindering, delaying or defrauding creditors or (2) we or any of our guarantors, as applicable, received less than reasonably equivalent value or fair consideration in return for issuing Notes, a guarantee or a security interest and, in the case of (2) only, one of the following is also true:

• we or any of our guarantors were or was insolvent or rendered insolvent by reason of issuing Notes or the guarantees;

• payment of the consideration left us or any of our guarantors with an unreasonably small amount of capital to carry on our or its business; or

• we or any of our guarantors intended to, or believed that we or it would, incur debts beyond our or its ability to pay as they mature.

If a court were to find that the issuance of the Notes or a guarantee was a fraudulent conveyance, the court could void the payment obligations under the Notes, the guarantees or the related security agreements, further subordinate the Notes or the payment obligations under such guarantee or security agreement to existing and future indebtedness of ours or such guarantor or require the holders of the Notes to repay any amounts received with respect to the Notes or such guarantee. In the event of a finding that a fraudulent conveyance occurred, you may not receive any repayment on the Notes. Further, the voidance of the Notes could result in an event of default with respect to our other debt and that of our guarantors that could result in acceleration of such debt. The measures of insolvency for purposes of fraudulent conveyance laws vary depending upon the laws of the jurisdiction that is being applied. Generally, an entity would be considered insolvent if, at the time it incurred indebtedness:

• the sum of its debts, including contingent liabilities, was greater than the fair saleable value of all its assets;

• the present fair saleable value of its assets was less than the amount that would be required to pay its probable liability on its existing debts and liabilities, including contingent liabilities, as they become absolute and mature; or

• it could not pay its debts as they become due.

We cannot be certain as to the standards a court would use to determine whether or not we or the guarantors were solvent at the relevant time, or regardless of the standard that a court uses, that the issuance of the Notes and the guarantees would not be subordinated to our or any guarantors’ other debt.

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If the guarantees were legally challenged, any guarantee could be subject to the finding of a court that, since the guarantee was incurred for our benefit, and only indirectly for the benefit of the guarantor, the obligations of the applicable guarantor were incurred for less than fair consideration. A court could thus void the obligations under the guarantees and related security agreements, subordinate them to the applicable guarantor’s other debt or take other action detrimental to the holders of the Notes.

Changes in the ratings of the Notes may cause their trading price to fall and affect the marketability of the Notes.

The old notes are, and upon issuance, the Notes will be, rated by Moody’s and S&P. A rating agency’s rating of the Notes is not a recommendation to purchase, sell or hold any particular security, including the Notes. Such ratings are limited in scope and do not comment as to material risks relating to an investment in the Notes. An explanation of the significance of such ratings may be obtained from such rating agency. There is no assurance that such credit ratings will remain in effect for any given period of time. As we are a 100 percent owned subsidiary of Fiat, any ratings downgrade for Fiat’s debt securities may influence the ratings of the Notes. Rating agencies also may lower, suspend or withdraw ratings on the Notes or our other debt in the future. Noteholders will have no recourse against us or any other parties in the event of a change in or suspension or withdrawal of such ratings. Any lowering, suspension or withdrawal of such ratings may have an adverse effect on the market prices or marketability of the Notes.

The collateral is subject to casualty risk.

Even if we maintain insurance, there are certain losses that may be either uninsurable or not economically insurable, in whole or part. Insurance proceeds may not compensate us fully for our losses. If there is a complete or partial loss of any collateral, the insurance proceeds may not be sufficient to satisfy all of our obligations, including the Notes and related guarantees.

Any future grant of a security interest in the collateral might be avoided by a trustee in bankruptcy.

Any future pledge of collateral in favor of the trustee, the collateral agent or its representative, as applicable, including pursuant to security documents delivered after the date of the Secured Senior Notes Indenture, might be avoided by the grantor (as debtor in possession) or by its trustee in bankruptcy if certain events or circumstances exist or occur, including, among others, if the grantor is insolvent at the time of granting the security or becomes insolvent as a result of entering into the security or associated documentation (including a guarantee) or a bankruptcy proceeding in respect of the security provider is commenced within a specified number of days following the granting of the security.

Rights of holders of the Notes in the collateral may be adversely affected by the failure to perfect security interests in certain collateral.

Applicable law requires that certain property and rights acquired after the grant of a general security interest can only be perfected at the time such property and rights are acquired and identified. The trustee, collateral agent or any representative of the collateral agent will have no obligation to monitor, and there can be no assurance that we will inform the trustee, collateral agent or any representative of the collateral agent of, the future acquisition of property and rights that constitute collateral, and that the necessary action will be taken to properly create or perfect the security interest in such after-acquired collateral. Neither the collateral agent nor the trustee for the Notes has any obligation to monitor the acquisition of additional property or rights that constitute collateral or the perfection of any security interest in favor of the Notes against third parties. Failure to perfect any such security interest may result in the loss of the security interest therein or the priority of the security interest in favor of the Notes against third parties.

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THE EXCHANGE OFFERS

Purpose of the Exchange Offers

The sole purpose of the exchange offers is to fulfill our obligations with respect to the registration of the old notes. We originally offered and sold the old notes on February 7, 2014. We did not register those sales under the Securities Act, in reliance upon the exemption provided in Section 4(2) of the Securities Act and Rule 144A and Regulation S promulgated under the Securities Act. In connection with the sale of the old notes we agreed to file with the SEC an exchange registration statement related to the exchange offers. Under the exchange registration statement, we will offer the Notes, in exchange for the old notes. See under the headingRegistration Rights in this prospectus for additional information regarding the Registration Rights Agreement.

How to Determine if You Are Eligible to Participate in the Exchange Offers

Upon the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal accompanying it, we will accept all old notes issued on February 7, 2014 validly tendered and not withdrawn prior to 5:00 p.m., New York City time on the expiration date. The Issuers will issue $1,000 in principal amount of Notes for each $1,000 in principal amount of the old notes accepted in the exchange offers. Holders may tender some or all of their old notes pursuant to the exchange offers in minimum denominations of $200,000 and integral multiples of $1,000 in excess thereof. The terms of the Notes are identical in all material respects to the terms of the old notes that you may exchange pursuant to the exchange offers, except that the Notes will not contain restrictions on transfer, will bear different CUSIP numbers and will not be entitled to certain registration rights and certain other provisions which are applicable to the old notes under the Registration Rights Agreement. The Notes will be entitled to the benefits of the indenture and will have the same CUSIP numbers as the Existing Notes and will be fungible with the corresponding series of Existing Notes. SeeDescription of the Notes.

We are not making the exchange offers to, nor will we accept surrenders for exchange from, holders of outstanding old notes in any jurisdiction in which the exchange offers or the acceptance thereof would not be in compliance with the securities or blue sky laws of such jurisdiction.

We are not making the exchange offers conditional upon the holders tendering, or us accepting, any minimum aggregate principal amount of old notes.

Under existing SEC interpretations, the Notes would generally be freely transferable after the exchange offers without further registration under the Securities Act, except that broker-dealers receiving the Notes in the exchange offers will be subject to a prospectus delivery requirement with respect to their resale. This view is based on interpretations by the staff of the SEC in no-action letters issued to other issuers in exchange offers like these. We have not, however, asked the SEC to consider these particular exchange offers in the context of a no-action letter. Therefore, the SEC might not treat them in the same way it has treated other exchange offers in the past. You will be relying on the no-action letters that the SEC has issued to third parties in circumstances that we believe are similar to ours. Based on these no-action letters, the following conditions must be met:

• you must not be a broker-dealer that acquired the old notes from us or in market-making transactions or other trading activities;

• you must acquire the Notes in the ordinary course of your business;

• you must have no arrangements or understandings with any person to participate in the distribution of the Notes within the meaning of the Securities Act; and

• you must not be an affiliate of ours, as defined in Rule 405 under the Securities Act.

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If you wish to exchange old notes for Notes in the exchange offers you must represent to us that you satisfy all of the above listed conditions. If you do not satisfy all of the above listed conditions:

• you cannot rely on the position of the SEC set forth in the no-action letters referred to above; and

• you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a resale of the new notes.

The SEC considers broker-dealers that acquired old notes directly from us, but not as a result of market-making activities or other trading activities, to be making a distribution of the Notes if they participate in the exchange offers. Consequently, these broker-dealers must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a resale of the Notes.

A broker-dealer that has bought old notes for market-making or other trading activities must deliver a prospectus in order to resell any Notes it receives for its own account in the exchange offers. The SEC has taken the position that broker-dealers may fulfill their prospectus delivery requirements with respect to the Notes by delivering the prospectus contained in the registration statement for the exchange offers. Each broker-dealer that receives Notes for its own account pursuant to the exchange offers must acknowledge that it will deliver a prospectus in connection with any resale of such Notes. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Notes received in exchange for old notes where such old notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of up to 180 days of the effectiveness of the exchange offer registration statement, we will make this prospectus available to any broker-dealer for use in connection with any such resale.

By tendering old notes for exchange, you will exchange, assign and transfer the old notes to us and irrevocably appoint the exchange agent as your agent and attorney-in-fact to assign, transfer and exchange the old notes. You will also represent and warrant that you have full power and authority to tender, exchange, assign and transfer the old notes and to acquire Notes issuable upon the exchange of such tendered old notes. The letter of transmittal requires you to agree that, when we accept your old notes for exchange, we will acquire good, marketable and unencumbered title to them, free and clear of all security interests, liens, restrictions, charges and encumbrances and that they are not subject to any adverse claim.

You will also warrant that you will, upon our request, execute and deliver any additional documents that we believe are necessary or desirable to complete the exchange, assignment and transfer of your tendered old notes. You must further agree that our acceptance of any tendered old notes and the issuance of Notes in exchange for them will constitute performance in full by us of our obligations under the Registration Rights Agreement and that we will have no further obligations or liabilities under that agreement, except in certain limited circumstances. All authority conferred by you will survive your death, incapacity, liquidation, dissolution, winding up or any other event relating to you, and every obligation of you shall be binding upon your heirs, personal representatives, successors, assigns, executors and administrators.

If you are tendering old notes, we will not require you to pay brokerage commissions or fees or, subject to the instructions in the letter of transmittal, transfer taxes with respect to the exchange of the old notes pursuant to the exchange offers. Each of the Notes will bear interest from the most recent date through which interest has been paid on the old notes for which they were exchanged. If we accept your old notes for exchange, you will waive the right to have interest accrue, or to receive any payment in respect to interest, on the old notes from the most recent interest payment date to the date of the issuance of the Notes. Interest on the Notes is payable semiannually in arrears on June 15 and December 15, starting on June 15, 2014.

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Information about the Expiration Date of the Exchange Offers and Changes to It

The exchange offers expire on the expiration date, which is 5:00 p.m., New York City time, on              , 2014, unless we, in our sole discretion, extend the period during which an exchange offer is open, and we will extend the expiration date to the extent required by Rule 13e-4 under the Exchange Act of 1934, as amended, or the Exchange Act. If we extend the expiration date for an exchange offer, the term “expiration date” means the latest time and date on which such exchange offer, as so extended, expires. We reserve the right to extend the exchange offers at any time and from time to time prior to the expiration date by giving written notice to Citibank, N.A., which is the exchange agent, and by timely public announcement communicated by no later than 5:00 p.m., New York City time, on the next business day following the expiration date, unless applicable law or regulation requires otherwise, by making a release to the Dow Jones News Service. We may extend the expiration date of either exchange offer for any reason, and we may extend the expiration date of one exchange offer without extending the expiration date of the other exchange offer. The exchange offers are not conditioned upon each other, and we may withdraw, extend or modify the terms of one exchange offer without withdrawing, extending or modifying the terms of the other exchange offer in our sole discretion. During any extension of an exchange offer, all old notes previously tendered pursuant to such exchange offer will remain subject to such exchange offer.

The initial exchange date will be the third business day following the expiration date. We expressly reserve the right to terminate one or both of the exchange offers and not accept for exchange any old notes for any reason, including if any of the events set forth below under—We may modify or terminate the exchange offers under some circumstances have occurred and we have not waived them. We also reserve the right to amend the terms of one or both of the exchange offers in any manner, whether before or after any tender of the old notes. If we terminate or amend an exchange offer, we will notify the exchange agent in writing and will either issue a press release or give written notice to you as a holder of the old notes as promptly as practicable. Unless we terminate the exchange offers prior to 5:00 p.m., New York City time, on the expiration date (as such date may be extended as described above), we will exchange the Notes for old notes on the exchange date.

We will mail this prospectus and the related letter of transmittal and other relevant materials to you as a record holder of old notes and we will furnish these items to brokers, banks and similar persons whose names, or the names of whose nominees, appear on the lists of holders for subsequent transmittal to beneficial owners of old notes.

How to Tender Your Old Notes

If you tender to us any of your old notes pursuant to one of the procedures set forth below, that tender will constitute an agreement between you and us in accordance with the terms and subject to the conditions that we describe below and in the letter of transmittal for the exchange offers.

You may tender old notes by properly completing and signing the letter of transmittal or a facsimile of it. All references in this prospectus to the “letter of transmittal” include a facsimile of the letter. You must deliver it, together with the certificate or certificates representing the old notes that you are tendering and any required signature guarantees, or a timely confirmation of a book-entry transfer pursuant to the procedure that we describe below, to the exchange agent at its address set forth on the back cover of this prospectus on or prior to the expiration date. You may also tender old notes by complying with the guaranteed delivery procedures that we describe below.

Your signature does not need to be guaranteed if you registered your old notes in your name, you will register the Notes in your name and you sign the letter of transmittal. In any other case, the registered holder of your notes must endorse them or send them with duly executed written instruments of transfer in the form satisfactory to us. Also, an “eligible institution,” such as a bank, broker, dealer, credit union, savings association, clearing agency or other institution that is a member of a recognized signature guarantee medallion program within the meaning of Rule 17Ad-15 under the Exchange Act must guarantee the signature on the endorsement or instrument of

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transfer. If you want us to deliver the Notes or non-exchanged old notes to an address other than that of the registered holder appearing on the note register for the old notes, an “eligible institution” must guarantee the signature on the letter of transmittal.

If your old notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and you wish to tender old notes, you should contact the registered holder promptly and instruct the holder to tender old notes on your behalf. If you wish to tender your old notes yourself, you must, prior to completing and executing the letter of transmittal and delivering your old notes, either make appropriate arrangements to register ownership of the old notes in your name or follow the procedures described in the immediately preceding paragraph. Transferring record ownership from someone else’s name to your name may take considerable time.

How to Tender if You Hold Your Old Notes Through a Broker or Other Institution and You Do Not Have the Actual Old Notes

Any financial institution that is a participant in The Depository Trust Company’s, or DTC, systems may make book-entry delivery of your old notes by causing DTC to transfer your old notes into the exchange agent’s account at DTC in accordance with DTC’s electronic Automated Tender Offer Procedures for transfer. Although you may deliver your old notes through book-entry transfer at DTC, you still must send either an executed and properly completed letter of transmittal, with any required signature guarantees, or an agent’s message and any other required documents, to the exchange agent at the address specified on the back cover of this prospectus on or prior to the expiration date and the exchange agent must receive these documents on time. Delivery of documents to DTC in accordance with its procedures does not constitute delivery to the exchange agent. If you will not be able to send all the documents on time, you can still tender your old notes by using the guaranteed delivery procedures described below.

You assume the risk of choosing the method of delivery of old notes and all other documents. If you send your old notes and your documents by mail, we recommend that you use registered mail, return receipt requested, you obtain proper insurance, and you mail these items sufficiently in advance of the expiration date to permit delivery to the exchange agent on or before the expiration date.

If you do not provide your taxpayer identification number, which is your social security number or employer identification number, as applicable, and certify that such number is correct, the exchange agent will withhold 28% of the gross proceeds otherwise payable to you pursuant to the exchange offers, unless an exemption applies under the applicable law and regulations concerning “backup withholding” of federal income tax. You should complete and sign the main signature form and the Substitute Form W-9 included as part of the letter of transmittal, so as to provide the information and certification necessary to avoid backup withholding, unless an applicable exemption exists and you prove it in a manner satisfactory to us and the exchange agent.

The term “agent’s message” means a message, transmitted by DTC and received by the exchange agent and forming part of the confirmation of a book-entry transfer, which states that DTC has received an express acknowledgment from a participant in DTC tendering old notes stating:

• the aggregate principal amount of old notes which have been tendered by the participant;

• that such participant has received an appropriate letter of transmittal and agrees to be bound by the terms of the letter of transmittal and the terms of the exchange offer; and

• that we may enforce such agreement against the participant.

Delivery of an agent’s message will also constitute an acknowledgment from the tendering DTC participant that the representations contained in the letter of transmittal and described above underHow to determine if you are eligible to participate in the exchange offers are true and correct.

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How to Use the Guaranteed Delivery Procedures if You Will Not Have Enough Time to Send All Documents to Us

If you desire to accept an exchange offer, and time will not permit a letter of transmittal (or agent’s message) or old notes to reach the exchange agent before the expiration date, you may tender your old notes if the exchange agent has received at its office listed on the letter of transmittal on or prior to the expiration date a letter or facsimile transmission (or an agent’s message) from an eligible institution setting forth your name and address, the principal amount of the old notes that you are tendering, the names in which you registered the old notes and, if possible, the certificate numbers of the old notes that you are tendering.

The eligible institution’s correspondence to the exchange agent must state that the correspondence constitutes the tender and guarantee that within three New York Stock Exchange trading days after the date that the eligible institution executes such correspondence, the eligible institution will deliver the old notes, in proper form for transfer, together with a properly completed and duly executed letter of transmittal, or agent’s message with a confirmation of book-entry transfer of the old notes into the exchange agent’s account at DTC, and any other required documents. We may, at our option, reject the tender if you do not tender your old notes and accompanying documents by either the above-described method or by a timely book-entry confirmation, and if you do not deposit your old notes and tender documents with the exchange agent within the time period set forth above. Copies of a notice of guaranteed delivery that eligible institutions may use for the purposes described in this paragraph are available from the exchange agent.

Valid receipt of your tender will occur as of the date when the exchange agent receives your properly completed letter of transmittal, accompanied by either the old notes, or a timely book-entry confirmation accompanied by an agent’s message. We will issue Notes in exchange for old notes that you tendered pursuant to a notice of guaranteed delivery or correspondence to similar effect as described above by an eligible institution only against deposit of the letter of transmittal or an agent’s message, any other required documents and either the tendered old notes or a timely book-entry confirmation.

We Reserve the Right to Determine Validity of All Tenders

We will be the sole judge of all questions as to the validity, form, eligibility, including time of receipt, and acceptance for exchange of your tender of old notes and our judgment will be final and binding. We reserve the absolute right to reject any or all of your tenders that are not in proper form or the acceptances for exchange of which may, in our opinion or in the opinion of our counsel, be unlawful. We also reserve the absolute right to waive any of the conditions of the exchange offers or any defect or irregularities in your case. Neither we, the exchange agent nor any other person will be under any duty to give you notification of any defects or irregularities in tenders nor shall any of us incur any liability for failure to give you any such notification. Our interpretation of the terms and conditions of the exchange offers, including the letter of transmittal and its instructions, will be final and binding.

If You Tender Old Notes Pursuant to the Exchange Offers, You May Withdraw Them at Any Time Prior to the Expiration Date

For your withdrawal to be effective, the exchange agent must timely receive your written or fax (for eligible institutions) notice of withdrawal prior to the expiration date at the exchange agent’s address set forth on the back cover page of this prospectus. Your notice of withdrawal must specify the following information:

• The person named in the letter of transmittal as tendering old notes you are withdrawing;

• The certificate numbers of old notes you are withdrawing;

• The principal amount of old notes you are withdrawing;

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• A statement that you are withdrawing your election to have us exchange such old notes; and

• The name of the registered holder of such old notes, which may be a person or entity other than you, such as your broker-dealer.

The person or persons who signed your letter of transmittal, including any eligible institutions that guaranteed signatures on your letter of transmittal, must sign the notice of withdrawal in the same manner as their original signatures on the letter of transmittal including any required signature guarantees. If such persons and eligible institutions cannot sign your notice of withdrawal, you must send it with evidence satisfactory to us that you now hold beneficial ownership of the old notes that you are withdrawing. Alternately, for a withdrawal to be effective for DTC participants, holders must comply with their respective standard operating procedures for electronic tenders and the exchange agent must receive an electronic notice of withdrawal from DTC. Any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn old notes and otherwise comply with the procedures of DTC.

The exchange agent will return the properly withdrawn old notes promptly following receipt of notice of withdrawal. We will determine all questions as to the validity of notices of withdrawals, including time of receipt, and our determination will be final and binding on all parties.

How We Will Either Exchange Your Old Notes for Notes or Return Them to You

On the exchange date, we will determine which old notes the holders validly tendered, and we will issue Notes in exchange for the validly tendered old notes. The exchange agent will act as your agent for the purpose of receiving Notes from us and sending the old notes to you in exchange for Notes promptly after acceptance of the tendered old notes. If we do not accept your old notes for exchange, we will return them without expense to you. If you tender your old notes by book-entry transfer into the exchange agent’s account at DTC pursuant to the procedures described above and we do not accept your old notes for exchange, DTC will credit your non-exchanged old notes to an account maintained with DTC. In either case, we will return your non-exchanged old notes to you promptly following the expiration of the exchange offers.

We May Modify or Terminate the Exchange Offers under Some Circumstances

We are not required to issue Notes in respect of any properly tendered old notes that we have not previously accepted and we may terminate the exchange offers or, at our option, we may modify or otherwise amend the exchange offers. If we terminate an exchange offer, it will be by oral (promptly confirmed in writing) or written notice to the exchange agent and by timely public announcement communicated no later than 5:00 p.m. New York City time on the next business day following the expiration date, unless applicable law or regulation requires us to terminate the exchange offers in the following circumstances:

• Any court or governmental agency brings a legal action seeking to prohibit the exchange offers or assessing or seeking any damages as a result of the exchange offers, or resulting in a material delay in our ability to accept any of the old notes for exchange offers; or

• Any government or governmental authority, domestic or foreign, brings or threatens any law or legal action that in our sole judgment, might directly or indirectly result in any of the consequences referred to above; or, if in our sole judgment, such activity might result in the holders of Notes having obligations with respect to resales and transfers of Notes that are greater than those we described above in the interpretations of the staff of the SEC or would otherwise make it inadvisable to proceed with the exchange offers; or

• A material adverse change has occurred in our business, condition (financial or otherwise), operations or prospects.

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The foregoing conditions are for our sole benefit and we may assert them with respect to all or any portion of the exchange offers regardless of the circumstances giving rise to such condition. We also reserve the right to waive these conditions in whole or in part at any time or from time to time in our discretion. Our failure at any time to exercise any of the foregoing rights will not be a waiver of any such right, and each right will be an ongoing right that we may assert at any time or from time to time. In addition, we have reserved the right, notwithstanding the satisfaction of each of the foregoing conditions, to terminate or amend the exchange offers.

Any determination by us concerning the fulfillment or nonfulfillment of any conditions will be final and binding upon all parties.

In addition, we will not accept for exchange any tendered old notes, and we will not issue Notes in exchange for any such old notes, if at that time there is, or the SEC has threatened, any stop order with respect to the registration statement that this prospectus is a part of, or if qualification of the indenture is required under the Trust Indenture Act of 1939.

Where to Send Your Documents for the Exchange Offers

We have appointed Citibank, N.A. as the exchange agent for the exchange offers. You must send your letter of transmittal to the exchange agent at:

Citibank, N.A.

Attention: Citibank Agency & Trust

480 Washington Boulevard, 30th Floor

Jersey City, New Jersey 07310

Telephone: (973) 461-7169

Facsimile: (973) 461-7191 or (973) 461-7192

If you send your documents to any other address or fax number, you will have not validly delivered them and you will not receive Notes in exchange for your old notes. We will return your old notes to you.

We Are Paying Our Costs for the Exchange Offers

We have not retained any dealer-manager or similar agent in connection with the exchange offers and will not make any payments to brokers, dealers or others for soliciting acceptances of the exchange offers. We will, however, pay the exchange agent reasonable and customary fees for its services and will reimburse it for reasonable out-of-pocket expenses. We will also pay brokerage houses and other custodians, nominees and fiduciaries the reasonable out-of-pocket expenses that they incur in forwarding tenders for their customers. We will pay the expenses incurred by us in connection with the exchange offers, including the fees and expenses of the exchange agent and printing, accounting, investment banking and legal fees. We estimate that these fees are approximately $750,000.

No person has been authorized to give you any information or to make any representations to you in connection with the exchange offers other than those that this prospectus contains, and we take no responsibility for any other information that others may give you. If anyone else gives you information or representations about the exchange offers, you should not assume that we have authorized it. Neither the delivery of this prospectus nor any exchange made hereunder shall, under any circumstances, create any implication that there has been no change in our affairs since the respective dates as of which this prospectus gives information. We are not making the exchange offers to, nor will we accept tenders from or on behalf of, holders of old notes in any jurisdiction in which it is unlawful to make the exchange offers or to accept it. However, we may, at our discretion, take such action as we may deem necessary to make the exchange offers in any such jurisdiction and extend the exchange offers to holders of old notes in such jurisdiction. In any jurisdiction where the securities laws or blue sky laws require a licensed broker or dealer to make the exchange offers one or more registered brokers or dealers that are licensed under the laws of that jurisdiction is making the exchange offers on our behalf.

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There Are No Dissenters’ or Appraisal Rights

Holders of old notes will not have dissenters’ rights or appraisal rights in connection with the exchange offers.

Federal Income Tax Consequences to You

Your exchange of old notes for Notes should not be a taxable exchange for federal income tax purposes, and you should not recognize any taxable gain or loss or any interest income as a result of the exchange. SeeCertain U.S. Federal Income Tax Considerations below.

These Are the Only Exchange Offers for the Old Notes that We Are Required to Make

Your participation in the exchange offers is voluntary, and you should carefully consider whether to accept the terms and conditions of it. You are urged to consult your financial and tax advisors in making your own decisions on what action to take with respect to the exchange offers. If you do not tender your old notes in the exchange offers, you will continue to hold such old notes and you will be entitled to all the rights and limitations applicable to the old notes under the indenture. All non-exchanged old notes will continue to be subject to the restriction on transfer set forth in the indenture. If we exchange old notes in the exchange offers, the trading market, if any, for any remaining old notes could be much less liquid.

We may in the future seek to acquire non-exchanged old notes in the open market or privately negotiated transactions, through subsequent exchange offers or otherwise. We have no present plan to acquire any old notes that are not exchanged in the exchange offers.

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USE OF PROCEEDS

We will not receive any proceeds from the issuance of Notes pursuant to the exchange offers. Old notes that are validly tendered and exchanged will be retired and cancelled. We will pay all expenses incident to the exchange offers.

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SELECTED HISTORICAL CONSOLIDATED FINANCIAL AND OTHER DATA

The following table presents summary historical consolidated financial and other data of Chrysler Group (Successor) and Old Carco (Predecessor). The historical financial data has been derived from:

• Chrysler Group’s accompanying audited consolidated financial statements as of December 31, 2013 and 2012 and for the years ended December 31, 2013, 2012, and 2011 (Successor);

• Chrysler Group’s audited consolidated financial statements as of December 31, 2011 and 2010 and for the year ended December 31, 2010, which are not included in this prospectus;

• Chrysler Group’s audited consolidated financial statements as of December 31, 2009 and for the period from June 10, 2009 to December 31, 2009 (Successor), which are not included in this prospectus; and

• Old Carco’s audited consolidated financial statements as of June 9, 2009 and for the period from January 1, 2009 to June 9, 2009 (Predecessor), which are not included in this prospectus.

Chrysler Group was formed on April 28, 2009. On June 10, 2009, we purchased the principal operating assets and assumed certain liabilities of Old Carco and its principal domestic subsidiaries, in addition to acquiring the equity of Old Carco’s principal foreign subsidiaries, in the 363 Transaction approved by the bankruptcy court. Chrysler Group represents the Successor to Old Carco for financial reporting purposes. Old Carco represents the predecessor to Chrysler Group for accounting and financial reporting purposes.

The following data should be read in conjunction withManagement’s Discussion and Analysis of Financial Condition and Results of Operations, Risk Factors, Summary, Selected Historical Consolidated Financial and Other Data,Business and the historical consolidated financial statements and notes thereto included elsewhere in this prospectus. Historical results for any prior period are not necessarily indicative of results to be expected in any future period.

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	Successor															Predecessor
	Year ended, and balance sheet data as of, December 31,												Period from June 10, 2009 to December 31, 2009			Period from January 1, 2009 to June 9, 2009
	2013			2012			2011			2010
	(in millions of dollars)															(in millions of dollars)
Consolidated Statements of Income Data:
Revenues, net	$	72,144		$	65,784		$	54,981		$	41,946		$	17,710		$	11,082
Gross margin		10,746			10,434			8,559			6,060			1,599			(1,934	)
Selling, administrative and other expenses		5,218			5,179			4,751			3,797			4,336			1,599
Research and development expenses, net		2,320			2,324			1,674			1,500			626			452
Restructuring (income) expenses, net (1)		(14	)		(61	)		3			48			34			(230	)
Interest expense (2)		1,035			1,094			1,238			1,276			470			615
Loss on extinguishment of debt (3)(4)		24			—			551			—			—			—
Impairment of brand name intangible assets (5)		—			—			—			—			—			844
Reorganization expenses, net (6)		—			—			—			—			—			843
Net income (loss)		2,757			1,668			183			(652	)		(3,785	)		(4,425	)
Consolidated Statements of Cash Flows Data:
Cash flows provided by (used in):
Operating activities	$	5,536		$	5,821		$	4,603		$	4,195		$	2,335		$	(7,130	)
Investing activities		(3,413	)		(3,557	)		(1,970	)		(1,167	)		250			(404	)
Financing activities		(302	)		(251	)		(405	)		(1,526	)		3,268			7,517
Other Financial Information:
Depreciation and amortization expense	$	2,941		$	2,701		$	2,876		$	3,051		$	1,587		$	1,537
Capital expenditures		3,434			3,633			3,009			2,385			1,088			239
Consolidated Balance Sheets Data at Period End:
Cash, cash equivalents and marketable securities	$	13,344		$	11,614		$	9,601		$	7,347		$	5,877		$	1,845
Restricted cash		333			371			461			671			730			1,133
Total assets		45,870			40,971			37,543			35,449			35,423			33,577
Current maturities of financial liabilities		491			456			230			2,758			1,092			2,694
Long-term financial liabilities		11,810			12,147			12,344			10,973			8,459			1,900
Members’ deficit		(1,242	)		(7,259	)		(6,035	)		(4,489	)		(4,230	)		(16,562	)
Other Statistical Information (unaudited):
Worldwide factory shipments (in thousands) (7)(9)		2,563			2,409			2,011			1,602			670			381
Net worldwide factory shipments (in thousands)(8)(9)		2,542			2,432			1,993			1,581			672			459
Worldwide vehicle sales (in thousands) (9)		2,401			2,194			1,855			1,516			725			593
U.S. dealer inventory at period end (in thousands)		509			427			326			236			179			246
Number of employees at period end (10)		73,712			65,535			55,687			51,623			47,326			48,237

(1) Old Carco initiated multi-year recovery and transformation plans aimed at restructuring its business in 2007, which were refined in 2008 and 2009 due to depressed economic conditions and decreased demand for its vehicles. We have

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continued to execute the remaining actions initiated by Old Carco. For additional information refer toManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations.

(2) Interest Expense for the period from January 1, 2009 to June 9, 2009 excludes $57 million of contractual interest expense on debt subject to compromise.

(3) In connection with the June 2013 amendment of our Senior Credit Facilities and the December 2013 re-pricing of the tranche B term loan maturing on May 24, 2017, or Tranche B Term Loan, we recognized a $24 million loss on extinguishment of debt. The loss consisted of the write off of $13 million of unamortized debt discounts and $3 million of unamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of call premium and other fees associated with the amendments. Refer toManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources —Senior Credit Facilities for additional information.

(4) In connection with the May 2011 repayment of our outstanding obligations under the U.S. Treasury first lien credit facilities, or U.S. Treasury credit facilities, and the Export Development Canada Credit Facilities, or EDC credit facilities, we recognized a $551 million loss on extinguishment of debt. The charges consisted of the write off of $136 million of unamortized discounts and $34 million of unamortized debt issuance costs associated with the U.S. Treasury credit facilities and $367 million of unamortized discounts and $14 million of unamortized debt issuance costs associated with the EDC credit facilities.

(5) Old Carco recorded indefinite-lived intangible asset impairment charges of $844 million during the period from January 1, 2009 to June 9, 2009 related to its brand names. The impairment was primarily a result of the significant deterioration in Old Carco’s revenues, the ongoing volatility in the U.S. economy, in general, and in the automotive industry in particular, and a significant decline in its projected production volumes and revenues considering the market conditions at that time.

(6) In connection with Old Carco’s bankruptcy filings, Old Carco recognized $843 million of reorganization expenses, net during the period from January 1, 2009 to June 9, 2009, from the settlement of pre-petition liabilities, provisions for losses resulting from the reorganization and restructuring of the business, as well as professional fees directly related to the process of reorganizing Old Carco and its principal domestic subsidiaries under Chapter 11 of the U.S. Bankruptcy Code. These losses were partially offset by a gain on extinguishment of certain financial liabilities and accrued interest.

(7) Represents vehicle sales to our dealers, distributors, contract manufacturing customers and fleet customers. For additional information refer toManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations —Worldwide Factory Shipments.

(8) Represents vehicle sales to our dealers, distributors, contract manufacturing customers and fleet customers adjusted for Guaranteed Depreciation Program, or GDP, vehicle shipments and auctions. For additional information refer toManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations —Worldwide Factory Shipments.

(9) Vehicles manufactured by Chrysler Group for other companies, including for Fiat, are included in our worldwide factory shipments and new worldwide factory shipments, however, they are excluded from our worldwide vehicles sales.

(10) The number of employees provided for June 9, 2009 is as of June 30, 2009.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion of our financial condition and results of operations together with the information included underBusiness,Selected Historical Consolidated Financial Data and our condensed consolidated financial statements and related notes thereto, our consolidated financial statements and related notes thereto and Old Carco’s consolidated financial statements and notes thereto included elsewhere in this prospectus. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described underDisclosure Regarding Forward-Looking Statements andRisk Factors. Actual results may differ materially from those contained in any forward-looking statements.

Overview of our Formation and Operations

Chrysler Group was formed on April 28, 2009 as a Delaware limited liability company to complete the 363 Transaction. On April 30, 2009, Old Carco and its principal domestic subsidiaries filed for bankruptcy protection. On June 10, 2009, Chrysler Group LLC completed the 363 Transaction and purchased the principal operating assets and assumed certain liabilities of Old Carco and its principal domestic subsidiaries, in addition to acquiring the equity of Old Carco’s principal foreign subsidiaries. As a key part of that transaction, we entered into the Fiat-Chrysler Alliance that provides for collaboration in a number of areas, including product, platform and powertrain sharing and development, global distribution, procurement, information technology infrastructure and process improvement. SeeBusiness —Chrysler Group Overview—Formation of Chrysler Groupfor a description of the circumstances surrounding our formation and the Fiat-Chrysler Alliance for additional information.

We generate revenues, income and cash primarily from our sales of Chrysler, Jeep, Dodge and Ram vehicles and Mopar service parts and accessories to dealers and distributors for sale to retail customers and fleet customers. Our product lineup includes passenger cars, utility vehicles (including SUVs and crossover vehicles), minivans, trucks and commercial vans. As part of the Fiat-Chrysler Alliance, we also manufacture certain Fiat-brand vehicles in Mexico, which are distributed by us throughout North America and select markets and sold to Fiat for distribution in other select markets. In addition, Fiat manufactures certain Fiat-brand vehicles for us, which we sell throughout North America. The majority of our operations, employees, independent dealers and vehicle sales are in North America, principally in the U.S. Approximately 10 percent of our vehicle sales in 2012 and 2013 were outside North America, mostly in Asia Pacific, South America and Europe. We also generate revenues, income and cash from the sale of separately-priced service contracts to consumers and from providing contract manufacturing services to other vehicle manufacturers. Our dealers enter into wholesale financing arrangements to purchase vehicles to hold in inventory for sale to retail customers. Our retail customers use a variety of finance and lease programs to acquire vehicles from our dealers.

Progress on our Strategic Business Plan

In November 2009, we announced the 2010-2014 Business Plan. The 2010-2014 Business Plan focuses on a number of initiatives designed to bring significant improvements to our business by leveraging the Fiat-Chrysler Alliance. These targets included: upgrading our product styling, innovation, quality, safety and fuel economy; rejuvenating and refining our brands; improving processes in procurement, supply chain management and manufacturing; enhancing our information technology infrastructure; optimizing our dealer network and global distribution strategy; and building a workforce culture of high performance.

We have made significant progress against the objectives in the 2010-2014 Business Plan as they related to:

• Product Development. We have made meaningful strides in rationalizing our product mix to produce a range of desirable vehicles with improved fuel economy. Where feasible, we have leveraged the use of common vehicle platforms, powertrains and technologies with Fiat. Following

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these principles, we have completed an extensive renewal of our product lineup with the launch of over 25 new or significantly refreshed vehicles since we began operations in mid-2009. We characterize a vehicle as “new” if its platform is significantly different from the platform used in the prior model year and/or has had a full exterior renewal. We characterize a vehicle as “significantly refreshed” if it continues its previous platform but has extensive changes or upgrades from the prior model. Among those vehicles was the widely-acclaimed new Jeep Grand Cherokee, which we leveraged to develop and launch the all new three-row Dodge Durango to better accommodate families. In addition, we worked in cooperation with Fiat to launch our first vehicle in the mini-segment, the eco-friendly Fiat 500, as well as our first vehicle in the B-segment, the all-new Fiat 500L which is contract manufactured for us by Fiat. In 2013, we also launched our first full function electric vehicle, the Fiat 500e.

Our success to date and ability to make such meaningful strides as a relatively small manufacturer as compared to our competitors was based largely on the Fiat-Chrysler Alliance, as the Fiat-Chrysler Alliance gave us a significant advantage over starting such a revitalization of our product lineup on our own. SeeRisk Factors —Risks Relating to Our Business—We depend on the Fiat-Chrysler Alliance to provide new vehicle platforms and powertrain technologies, additional scale, global distribution and management resources that are critical to our viability and success.

In 2012, we launched the new, fuel-efficient Dodge Dart, the first vehicle built on the compact U.S. wide, or CUSW, platform that we co-developed with Fiat. We are also using the CUSW platform for the all-new 2014 Jeep Cherokee. The CUSW platform will also be used for our future mid-size vehicles (D-segment), except the body-on-frame Jeep Wrangler. In 2013, we launched the all-new Fiat 500L, our first vehicle to use the jointly-developed platform for the B-segment, or Small Wide platform. We expect that widespread use of the CUSW and Small Wide platforms will reduce the total number of our passenger car and SUV platforms from 11 in 2010 to nine by the end of 2014, three of which will be shared with Fiat. We plan to continue to use other platforms for our pick-up and chassis cab trucks, as well as for minivans, full-size SUVs and the all-new 2013 SRT Viper, which became available to customers in early 2013. We expect to garner savings from common sourcing for shared platform technology, and expect that benefit will continue to grow with the wider deployment of such common architectures.

For the third consecutive year,Ward’s Auto recognized our Pentastar V-6 engine as one of the “10 Best Engines” in 2013. Because of this engine’s flexible architecture, we are able to deploy it across our product portfolio, which affords us significant efficiencies in manufacturing and logistics. The engine contributes to greater fuel efficiency in our Jeep Grand Cherokee, Chrysler 300, Town and Country, and 14 other models. By October 2013, we had produced three million of these engines to meet growing demand, and we have taken several steps to increase our manufacturing capacity. We also manufacture the 1.4L 4-cylinder Fiat FIRE engine, for use in the Fiat 500 that we began selling in 2011. Finally, we continue our efforts to broaden the offerings for our Tigershark engine, and to combine it with Fiat technology. Additional progress on our efforts to develop and implement technologies in tandem with Fiat are detailed inBusiness —Research, Development and Intellectual Property.

The introduction of transmission technology is also a key element in our strategy to enhance fuel efficiency. In 2011, we introduced a new 8-speed automatic transmission in our E-segment 4-door sedans (Chrysler 300 and Dodge Charger) along with our light-duty Ram 1500 when equipped with the Pentastar V-6 engine. In 2013, we expanded utilization of the 8-speed transmission to the Jeep Grand Cherokee, Dodge Durango, and the V-8 applications for the Ram 1500, Chrysler 300 and Dodge Charger. Finally, we launched an all-new 9-speed automatic transmission in the all-new 2014 Jeep Cherokee.

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• Product Quality. We believe we are making significant progress in our efforts to enhance product quality and reliability. We have improved the quality of our interiors and implemented a number of improvements in our manufacturing processes and quality control through WCM. Our U.S. warranty claim rate, which is measured by conditions per 1,000 vehicles for vehicles that have been in service for three months, has fallen by over 19 percent since we began operations in mid-2009 to December 31, 2013. This measurement considers the number of claims made per 1,000 vehicles and is a non-financial metric used by management to gauge customer sentiments on vehicle quality and satisfaction. Additionally, our customer surveys indicate that these improvements, coupled with enhanced customer service, have increased Chrysler Group vehicle owners’ satisfaction with our products and their willingness to recommend our brands to their friends and families.

These changes have also continued to translate into improved third-party ratings and a number of awards recognizing the desirability and strong residual values of our vehicles. Our Ram 1500 received the North American International Auto Show 2013 “Truck/Utility of the Year.” The Ram 1500 was also selected as the 2013 and 2014Motor Trend “Truck of the Year.” Finally, our Jeep Grand Cherokee is the most awarded SUV ever.

• Enhancing Our Brands. We are continuing to focus heavily on building the value of our brands as a means to increase sales of our vehicles and service parts to minimize our reliance on sales incentives. This effort has included our multi-year campaigns to strengthen our Chrysler, Jeep, Dodge and Mopar brands, to develop Ram as a separate brand, to add the SRT designation for select performance vehicles, and to reintroduce the Fiat brand in the U.S. and Canadian markets.

In 2013, we continued to invest in our brands and our advertising campaigns emphasize the distinct features of each brand, such as the long-standing relationship of the Ram brand and the Future Farmers of America organization. The Dodge brand teamed with Paramount Pictures to launch the successful Ron Burgundy marketing campaign for the new 2014 Dodge Durango. Further, we strengthened the global footprint of the Jeep brand in 2013 through concerted advertising and marketing campaigns which included an emphasis on the brand’s historical ties to the U.S. military and many high-profile sponsorships. Jeep brand worldwide sales set an all-time record in 2013 of approximately 732,000 vehicles, with continued growth outside of North America.

Each brand is headed by an individual with responsibility for the brand’s identity and product portfolio and advertising strategy. The head of each brand is responsible for ensuring that each vehicle within that brand’s product lineup reflects brand attributes such as distinct appearance, capability, performance, content, ride and handling differentiation. In addition, we have separated advertising and marketing efforts for each brand to further underscore brand differentiation. We believe our substantial investment in marketing contributed to the nine percent increase in our U.S. vehicle sales in 2013 over 2012.

As with our own brands, our management of the Fiat brand for the North American market is headed by a single individual. We and Fiat are jointly responsible for determining strategies, policies and plans relating to this brand and Chrysler Group is responsible for management and implementation of such plans and policies throughout North America.

• Optimizing our U.S. Dealer Network. We have largely completed the optimization of our dealer network. As of December 31, 2013, 91 percent of our U.S. Chrysler, Jeep, Dodge and Ram dealers were selling all four brands of our vehicles in a single location. We are currently working to strengthen the network by closing gaps in geographical coverage, solidifying dealer profitability, modernizing sales and service facilities, and increasing diversity, all of which we believe will increase per-dealer sales. As of December 31, 2013, we had 2,604 U.S. dealers in our network, of which 2,390 were Chrysler, Jeep, Dodge and Ram dealers. As of December 31, 2013 we had 214

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independent Fiat dealerships in the U.S., of which 179 are owned by our Chrysler, Jeep, Dodge and Ram dealers. As of December 31, 2013 approximately 87 percent of the U.S. dealers in our dealer network reported to us that they were profitable. This compares to approximately 87 percent in 2012 and 86 percent in 2011.

Now with access to available capital on reasonable terms, our dealers are increasingly willing to make the significant investments necessary to attract customers. These investments have involved construction, renovation, and maintenance of modern sales and service facilities that are equipped with state-of-the-art diagnostic equipment, tools and information management systems, and are staffed by well-trained sales and service personnel. Since we began operations in mid-2009, our U.S. Chrysler, Jeep, Dodge and Ram dealers have invested or committed to invest over $850 million as of December 31, 2013 in new and renovated facilities to revitalize their image and improve the customer experience. In addition, our Fiat dealers have invested or committed to invest over $185 million as of December 31, 2013 in new, state-of-the-art facilities.

We continue to focus heavily on increasing diversity among the owners of our dealerships to better reflect and serve the communities in which they are situated. We are a leader in this effort, with more than seven percent of our dealerships minority owned and operated as of December 31, 2013. We have achieved this level of diversity through our 18-month education program that prepares high-potential minority candidates to own and successfully operate a dealership.

• Maximizing Efficiency through World Class Manufacturing. In 2013, we invested approximately $205 million in our manufacturing plants to improve the infrastructure, efficiency and quality of our production systems. This investment, which was incremental to the investments we made for our new model launches, was part of our continued effort to apply WCM principles to our manufacturing operations. WCM principles were developed by the WCM Association, a non-profit organization dedicated to developing superior manufacturing standards. Fiat is the only automobile manufacturer that belongs to the WCM Association and Fiat’s membership provides us access to WCM processes. WCM fosters a manufacturing culture that targets improved performance, safety and efficiency, as well as the elimination of all types of waste. Unlike some other advanced manufacturing programs, WCM is designed to prioritize issues to focus on those believed likely to yield the most significant savings, and then directs resources at those limited issues.

Our progress toward achieving WCM goals is verified by WCM experts, who measure our plants’ performance against 20 categories of pre-determined WCM metrics. In 2012, four Chrysler manufacturing facilities achieved WCM Bronze Award status (Dundee Engine, Windsor Assembly, Toledo Assembly Complex, and Saltillo Assembly). We conducted 46 WCM reviews in 2012, and 50 WCM reviews in 2013. Beginning in 2012 and throughout 2013, we engaged key suppliers in the pilot phase of WCM Lite, a program through which suppliers can learn and incorporate WCM principles in their own operations.

Our integration of WCM facilitated the launch of several new vehicles in 2012 and 2013, while also increasing our manufacturing pace to grow our shipments from 2.4 million in 2012 to 2.6 million in 2013, in line with the 2010-2014 Business Plan. We also utilized WCM principles to guide the production launch of the new 8-speed transmission at the Kokomo Transmission Plant (Indiana), and to introduce the 3-crew operating pattern at the Jefferson North Assembly Plant (Michigan), which helps us generate more volume without significantly increasing labor costs. Despite these demands on our operations, we have continued to drive process improvement in our plants. We reduced the frequency of injuries in 2013 by 36 percent from 2012. In addition, we made significant strides in manufacturing quality, advancing the dimensional control of our processes to achieve better consistency in fit and finish during assembly and stamping processes.

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In January 2012, we opened our WCM Academy, a training facility designed to transfer WCM know-how to participants using automated learning modules and a variety of hands-on simulation techniques. The WCM Academy delivered training to more than 3,900 employees across more than 45 courses in 2013. Participants who attend the full program commit to leading a follow-up WCM project in their home plant, and then return to the WCM Academy to verify and share their results. In addition to WCM Academy-based training, 61 in-plant workshops were conducted in 2013 to further advance WCM methodology and tool usage.

On January 21, 2014, we and the UAW agreed to a memorandum of understanding to supplement our existing collective bargaining agreement. Under the memorandum of understanding, we will provide additional payments to the VEBA Trust totaling $700 million to be paid in four equal annual installments. The initial payment of $175 million was made on closing of a transaction in which Fiat North America LLC, or FNA, acquired the VEBA Trust’s equity interest in the Company. In consideration for these payments, the UAW (i) agreed to certain commitments to continue to support the industrial operations at Chrysler Group and the further implementation of the Fiat-Chrysler Alliance, including to use best efforts to cooperate in the continued roll-out of Chrysler WCM programs, actively participate in benchmarking efforts associated with implementation of these programs across all of Fiat-Chrysler manufacturing sites to ensure objective performance assessments and provide for proper application of WCM principles and actively assist in the achievement of our long-term business plan, and (ii) agreed that it will not seek additional funding or other consideration in respect of the VEBA Trust in connection with any renegotiation or renewal of Chrysler Group’s collective bargaining agreement(s) with the UAW under any circumstance prior to the end of 2020.

• Procurement. We have established joint purchasing programs with Fiat that are designed to yield preferred pricing and supplier responsiveness, particularly with respect to shared parts and common suppliers. This joint sourcing has yielded benefits that span both direct and indirect procurement, from powertrain components and robots, to computer equipment and corporate expenses. Working with Fiat’s automotive and industrial affiliates, the Fiat-Chrysler Alliance provides the opportunity to develop global commodity and supplier strategies, which allow us to leverage our combined purchasing power. For example, in utilizing the shared CUSW platform for the Dodge Dart, we were able to negotiate tiered reductions in part costs. As volume grows with sales of the Dodge Dart and launches of subsequent vehicles based on the same platform, we expect to realize savings on common parts. We are currently working on a global component standardization initiative with Fiat. As we deploy these standardized components across our vehicle lines, we expect to realize additional savings in development, investment and variable cost. We continue to place significant emphasis on sustainability, including diversity, with our suppliers. In 2013 we were awarded the Corporation of the Year award from the National Minority Supplier Development Council for the innovative nature of our supplier diversity program.

• Supply Chain Management. In 2013, we continued to maintain the discipline in our supply chain function that began with the implementation of the 2010-2014 Business Plan in 2010. Our supply chain management function coordinates efforts to accurately forecast demand, manage the materials and vehicle ordering processes, track plant capacity, schedule production, allocate product inventory and arrange transportation logistics. Supply chain management is important in preventing potentially costly oversupply or undersupply conditions. Our continued rigor and process improvement in this area has enabled us to rapidly grow our shipments from 1.6 million vehicles in 2010 to 2.6 million vehicles in 2013, consistent with our planning assumptions in 2009. At the same time, our improved efficiency in logistics has helped us to improve our 2013 fuel economy for our internal fleet of trucks by eight percent over our 2010 figures, substantially reducing our CO₂ emissions on a per vehicle produced basis, in line with our commitment to sustainability.

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Our supply chain management also monitors our dealers’ vehicle inventory levels to maintain availability of vehicles to facilitate sales, while at the same time preventing excess dealer stock to avoid the need for increased dealer and retail incentives. Since we began operations in 2009, we have experienced significant growth in volumes. We have also faced many challenges in forecasting sales patterns given the launch of over 25 new or significantly refreshed vehicles, including most recently, the all-new 2014 Jeep Cherokee. We have nevertheless continued to manage U.S. dealer vehicle inventory levels to be more in line with market demand. Our days’ supply of inventory (number of vehicles in dealer inventory divided by the daily selling rate for the period) was 79 days, 73 days and 64 days, as of December 31, 2013, 2012 and 2011, respectively.

• Global Distribution. We have made significant progress on our plan to increase our sales of vehicles and service parts outside of North America by leveraging the Fiat-Chrysler Alliance to provide better access to key markets in Europe and South America. Our success to date and ability to make such significant progress in global distribution in such a short period of time was based largely on the Fiat-Chrysler Alliance, as the Fiat-Chrysler Alliance gave us a significant advantage in expanding such distribution activities. SeeRisk Factors—Risks Relating to Our Business—Meeting our objective of increasing our vehicle sales outside North America is largely dependent upon access to Fiat’s network of distribution arrangements, manufacturing capacity and local alliance partners. In June 2011, Fiat became the general distributor of our vehicles and service parts in Europe, where it sells our products through a network of dealers. Accordingly, we are producing and selling several of our vehicle models and related service parts to Fiat for significantly expanded distribution in Europe.

As part of the Fiat-Chrysler Alliance, we manufacture certain Fiat-brand vehicles in Mexico, which are distributed by us throughout North America and select markets and sold to Fiat for distribution in other select markets. In July 2011, we began producing the Fiat Freemont, a utility vehicle based on the Dodge Journey, which Fiat distributes in Europe. We have also implemented strategies by which we are benefiting from Fiat’s longstanding presence in Brazil, the largest automotive market in South America. In that regard, Fiat is also distributing the Chrysler Group manufactured Fiat Freemont in Brazil, and is selling a portion of the Fiat 500 vehicles that we manufacture in Mexico through its dealer networks in Brazil, Argentina and China. Fiat added the Fiat Freemont to its portfolio in China in 2012 and to Australia, South Korea and Russia in 2013. In addition, beginning with the all-new Fiat 500L, we purchase certain vehicles that are contract manufactured by Fiat in Europe for our sale in North America.

In 2011, we began distributing Alfa Romeo vehicles in Mexico. We are the exclusive distributor of Fiat brand vehicles and service parts throughout North America. In January 2012, we began selling Fiat, Fiat Professional, and Alfa Romeo vehicles and/or service parts for Fiat in certain markets outside of North America. As a result of this increased global activity, our sales outside of North America grew from 277,000 in 2012 to 309,000 in 2013, including sales of Fiat- and Lancia-branded vehicles manufactured by us and sold by Fiat.

Finally, we are exploring additional opportunities for the local production and expansion of the sale of Chrysler Group vehicles and service parts in growing and emerging markets, such as China, Brazil and India, in connection with Fiat’s efforts to establish or expand manufacturing and distribution activities in those markets. To that end, we licensed certain technology to Fiat for a vehicle that a Fiat joint venture began to produce in China in 2012 and another vehicle that is expected to begin production in 2014, and we are now selling related parts to that joint venture. In 2014, we expect to participate in an arrangement with Fiat to build a Jeep vehicle in China to be sold only in China.

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• Management Structure. At the time of our formation, we implemented a flatter management structure so that each functional area of our business reports directly to the Chief Executive Officer. To facilitate collaboration and enhance speed of decision-making, three management committees chaired by our Chief Executive Officer meet regularly to consider significant operational matters. Our Product Committee oversees capital investment, engineering and product development, and our Commercial Committee oversees matters related to sales and marketing. Both committees include the managers of each of our brands, most of whom also have a separate functional responsibility across all the brands. Our Industrial Committee, which consists of our industrial heads, has the responsibility to coordinate and expedite the mitigation of operational risks associated with the production and distribution of our vehicles. We believe this matrix system has fostered cooperation and information sharing and further speeds decision-making. For example, the head of the Jeep brand is also the head of international operations for all our brands, and the head of our Ram brand is also responsible for sales in the U.S. and Canada for all of our brands.

In September 2011, Fiat formed the GEC to oversee and enhance the operational integration of all Fiat interests, including Chrysler Group. Drawing leaders from both Chrysler Group and Fiat, the GEC has helped both parties to maximize the benefits of the Fiat-Chrysler Alliance, but has allowed us to continue to independently govern our business decisions to enhance value for our members. SeeRisk Factors—Risks Relating to Our Business—Certain of our executive officers and employees serve in similar roles for Fiat or its current or former affiliates, which may result in conflicts of interest for our management for a discussion of the risks relating to our management structure.

The 2010-2014 Business Plan also includes targets related to increased liquidity. On May 24, 2011, we completed a debt refinancing transaction whereby we entered into a senior credit agreement governing our $3.0 billion tranche B term loan maturing on May 24, 2017, and Revolving Facility, or Original Senior Credit Agreement, and issued the Secured Senior Notes excluding the old notes, or the 2011 Refinancing Transactions. The net proceeds received from the 2011 Refinancing Transactions, along with cash generated from our operations, were used to repay all amounts outstanding under the first lien credit facilities with the U.S. Treasury, or the U.S. Treasury credit facilities, and the Export Development Canada, or EDC, Credit Facilities, or EDC credit facilities. In connection with our repayment of the U.S. Treasury and EDC credit facilities, Fiat exercised its incremental equity call option for FNA to acquire an additional 16 percent fully-diluted ownership interest we issued pursuant to the terms of our governance documents. FNA, using funds contributed by Fiat, paid $1,268 million to us in connection with the exercise. In June 2013, we amended and restated our Original Senior Credit Agreement to reduce interest rates and amend certain negative covenants, including limitations on incurrence of indebtedness and certain limitations on restricted payments, among other things. We entered into an amendment to the Senior Credit Agreement in December 2013 to further lower applicable interest rates on the Tranche B Term Loan.

In February 2014, in connection with repayment in full of the VEBA Trust Note, we issued the old notes totaling approximately $2.8 billion of aggregate principal amount and incurred $2.0 billion in additional term loan borrowings. Refer to —Liquidity and Capital Resources —Liquidity Overviewand specifically to —Liquidity and Capital Resources —New Debt Issuances and Repayment of the VEBA Trust Note, —Liquidity and Capital Resources —Senior Credit Facilities and Secured Senior Notesand—Liquidity and Capital Resources —Repayment of U.S. Treasury and EDC Credit Facilities,below, for additional information regarding our current sources of liquidity and capital resources and refinancing transaction.

SeeBusiness —Chrysler Group Overviewand Certain Relationships and Related Party Transactions —Transactions with Fiatfor additional information regarding our progress in implementing the 2010-2014 Business Plan.

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Trends, Uncertainties and Opportunities

Rate of U.S. Economic Recovery. The U.S. economy has not yet fully recovered from the recession that developed in late 2007 and culminated in the severe global credit crisis in 2008 and 2009. The high unemployment rates that developed during that period have improved slowly over the past several years, while the U.S. economy has grown only moderately. Even if economic conditions continue to improve, a corresponding increase in vehicle sales may not occur due to factors such as rising interest rates and changes in consumer spending habits. Further, the initial recovery of the demand for vehicles in North America since 2010 may be partially attributable to the pent-up demand and age of the fleet following the extended economic downturn. U.S. vehicle sales in 2013, including medium- and heavy-duty vehicles of 15.9 million, still remain below the 16.5 million in 2007. For the past several years, we have conservatively estimated U.S. seasonally adjusted annualized rate, or SAAR, levels including medium- and heavy-duty vehicles, but our estimate of 16.3 million vehicles for 2014 is aligned with other industry estimates. Our ability to meet our performance targets in 2014 and future years will depend significantly on whether our estimates of growth are accurate, and whether we continue to capture greater market share as that growth unfolds.

Product Development and Launches.Since we began operations in mid-2009, we have launched more than 25 new or significantly refreshed vehicles. An integral part of the 2010-2014 Business Plan is the continued refresh and growth of our vehicle portfolio and we have committed significant capital and resources toward an aggressive launch program of completely new vehicles on all new platforms, with additions of new powertrain and transmission technology. Despite this strong cadence, we are still suffering from the effects of the long interruption in Old Carco’s launch of new or significantly refreshed products, particularly during 2008 and 2009. Until our lineup consists of more competitive vehicles desired by consumers, particularly with respect to passenger cars, and in order to realize a return on the significant investments we have made, to sustain market share, and to achieve competitive operating margins, we will have to continue this accelerated pace of new vehicle launches. This challenging product development and launch schedule depends heavily on continued successful collaboration with Fiat, particularly in terms of sharing vehicle platforms and powertrains. During the development of these new offerings, despite the pace, we must also maintain our commitment to quality improvements. Moreover, our ability to continue to make the necessary investments in product development to achieve these plans depends in large part on the market acceptance and success of the new or significantly refreshed vehicles we introduce, as well as our ability to timely complete the aggressive launch schedule we have planned without sacrificing quality.

Pricing.Our profitability depends in part on our ability to maintain or increase margins on the sale of vehicles, while operating in an automotive industry that has intense price competition resulting from the wide variety of available competitive vehicles and manufacturing overcapacity. Historically, manufacturers have competed for vehicle sales by offering dealer, retail and fleet incentives, including cash rebates, option package discounts, guaranteed depreciation programs, and subsidized financing or leasing programs, all of which constrain margins on vehicle sales. Although we will continue to use such incentives to generate sales for particular models in particular geographic regions during specific time periods, we are focusing on achieving higher sales volumes by building brand value, balancing our product portfolio by offering smaller vehicle models, and improving the content, quality, fuel economy and performance of our vehicles. Throughout 2010, our U.S. retail average net transaction price increased and our average incentive per unit decreased, as adjusted for changes in model mix over the period, due to favorable content mix and net price discipline. We continued this positive trend into 2011, 2012 and 2013, and we have moderately increased our average net transaction price and kept our incentive per unit largely stable as well, as adjusted for changes in model mix. We may encounter challenges given that our smaller, less expensive cars are not currently as competitive as our larger, more profitable vehicles, and we may not be able to price our vehicles or minimize our incentives as planned.

Vehicle Profitability.Our results of operations depend on the profitability of the vehicles we sell, which tends to vary by vehicle segment. Vehicle profitability depends on a number of factors, including sales prices, net of sales incentives, costs of materials and components, as well as transportation and warranty costs. Typically, larger

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vehicles, which tend to have higher unit selling prices, have been more profitable on a per unit basis. Therefore, our minivans, larger utility vehicles and pick-up trucks have generally been more profitable than our passenger cars. Our minivans, larger utility vehicles and pick-up trucks accounted for approximately 70 percent of our total U.S. vehicle sales in 2013. While more profitable on a per unit basis, these larger vehicles have relatively low fuel economy and over the past several years, consumer preferences have shifted away from these vehicles, particularly in periods of relatively high fuel prices. As part of the Fiat-Chrysler Alliance, we continue to work toward a more balanced product portfolio that we believe will mitigate the impact of future shifts in consumer demand. In order to ensure that our portfolio of vehicles appropriately addresses the range of vehicles that may appeal to consumers over time, we have renewed our focus on the design, manufacturing, marketing and sale of our passenger cars, including mini, small and compact cars, notwithstanding the lower per unit profitability. Our success in selling these smaller vehicles will provide us not only with some protection from the effects of changing consumer preferences, but will also be an important part of our efforts to comply with tightening environmental and fuel economy standards and to achieve corporate sustainability goals. Until we develop a full line of competitive passenger car offerings, we must continue to make substantial investments in product development and engineering, and our ability to increase our margins on these offerings is therefore more limited than our competitors. In addition, our vehicle sales through dealers to customers are normally more profitable than our fleet sales. Our fleet customers increasingly tend to purchase a higher proportion of our smaller, more fuel-efficient vehicles, which have historically had a lower profitability per unit. Nevertheless, our fleet sales have been an important source of stable revenue and can also be an effective means for marketing our vehicles. Our fleet sales also help to normalize our plant production because they typically involve the delivery of a large, pre-determined quantity of vehicles over several months. In line with our plan to decrease fleet sales as a percentage of our total business, our U.S. fleet sales accounted for approximately 22 percent of our total U.S. vehicle sales for 2013, versus 26 percent in 2012, 28 percent in 2011 and 36 percent in 2010.

Cost of Sales. Our cost of sales is composed of a number of elements. The most significant element of our cost of sales is the cost of materials and components, which makes up the majority of our cost of sales, typically around 75 percent of the total. A large portion of our materials and component costs are affected directly or indirectly by raw materials prices, particularly prices for steel, aluminum, lead, resin and copper, as well as precious metals. The prices for these raw materials fluctuate and can be difficult to predict. These market conditions affect, to a significant extent, our ability to manage our cost of sales over the long-term. To the extent raw material price fluctuations may affect our cost of sales, we typically seek to manage these costs and minimize the impact on cost of sales through the use of fixed price purchase contracts and the use of commercial negotiations and technical efficiencies. As a result, for the periods reported, changes in raw material costs generally have not had a material effect on the period to period comparisons of our cost of sales. Nevertheless, our cost of sales related to materials and components has increased, as we have significantly enhanced the quality and content of our vehicles in an effort to remain competitive. Our ability to price our vehicles so as to recover those increased costs does, and will continue to, impact our profitability.

The remaining costs primarily include labor costs, consisting of direct and indirect wages and fringe benefits, as well as depreciation, amortization and transportation costs. Cost of sales also includes warranty and product-related costs, as well as depreciation expense related to our Guaranteed Depreciation Program, or GDP, vehicles. See—Results of Operations —Worldwide Factory Shipments for a discussion of the GDP. To grow our production from 2.4 million vehicles in 2012 to 2.6 million vehicles in 2013, these elements of our cost of sales increased. The uptick in our volumes has required us to take numerous actions to increase production capacity at our plants, and we have also had to demand that our suppliers quickly increase their production levels as well. This growth occurred in a production environment that was already capacity constrained. As a result of this growth, we could not maximize our efficiency, and we incurred non-standard costs for overtime, expedited freight and component banking. As with our suppliers, the industry’s just-in-time inventory systems further exacerbate our costs in times of sudden capacity constraints. In some cases, we outsourced our operations. However, moving our production to suppliers or to locations overseas, where there is available capacity, creates additional risk with respect to quality control, component pricing, logistics and currency exchange rates. We attempted to manage our labor costs where possible, but overtime payments were unavoidable in some of our

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operations. For example, in our Dundee Engine Plant (Michigan), demand meant that production continued during 29 Sundays and holidays in 2013. For 2013, we increased worldwide vehicle sales by 207,000 vehicles over 2012. We anticipate that we will encounter even more challenges as we work to contain our costs while we still maintain our production quality. To improve, or even maintain, our margins, we must contain the associated increases in our cost of sales.

Engineering, Design & Development Costs.In the past, suppliers often incurred the initial cost of engineering, designing and developing automotive component parts, and recovered their investments over time by including a cost recovery component in the price of each part based on expected volumes. Due in part to liquidity constraints faced by key suppliers, many of them have negotiated for cost recovery payments independent of volumes. This trend places increased demands on our liquidity and increases our economic risk, if new vehicles incorporating these components are not successful in the market.

Impact of Labor Cost Modifications.Our collective bargaining agreements with the UAW and the CAW, which is now part of Unifor, have introduced lower wage and benefit structures for new hire employees, eliminated the employment security system (commonly known as the “Jobs Bank,” which was a UAW provision only), and reduced other compensation programs for terminated or laid-off represented employees, other than traditional severance pay. Over time, these and other modifications are intended to help us achieve hourly labor costs that are comparable to those of the transplant automotive manufacturers with which we compete, while continuing to offer competitive compensation packages. We continue to realize the benefit of the new hire wage and benefit structure as our production increases and as a result of natural attrition. We successfully renegotiated our collective bargaining agreements with the UAW in 2011 and with the CAW, now part of Unifor, in 2012. These settlement provisions enable continued labor cost competitiveness within the U.S. and Canada automobile manufacturing industry through the terms of the respective agreements.

Fiat Ownership Interest

Through a series of transactions in 2011 and early 2012, which included our achievement of the three Class B Events described in our governance documents and Fiat’s exercise of its incremental equity call option in May 2011, Fiat increased its ownership interest in the Company from 20.0 percent to 58.5 percent.

In May 2011, and concurrent with the repayment of our U.S. Treasury and EDC credit facilities, Fiat exercised its incremental equity call option and acquired an additional 16 percent fully-diluted ownership interest in the Company through our issuance of Class A Membership Interests. We received the entire exercise price of $1,268 million in cash, increasing our contributed capital by the proceeds received. Refer to —Liquidity and Capital Resources —Repayment of U.S. Treasury and EDC Credit Facilities, for information related to our refinancing transaction and the repayment of our U.S. Treasury and EDC credit facilities.

In January 2013, and in accordance with our governance documents, the 200,000 Class B Membership Interests held by Fiat automatically converted to 571,429 Class A Membership Interests. There were no dilutive effects of the conversion.

In January 2014, Fiat, through its 100 percent owned indirect subsidiary, FNA, acquired the VEBA Trust’s remaining 41.5 percent membership interest in Chrysler Group LLC for $3.65 billion. SeeBusiness —Recent Developments —Fiat Acquisition of Equity Interest held by the VEBA Trust, for additional information regarding this transaction.

Critical Accounting Estimates

The audited consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, or U.S. GAAP, which require the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and

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liabilities at the date of the financial statements, and the reported amounts of revenues and expenses in the periods presented. We believe that the accounting estimates employed are appropriate and resulting balances are reasonable; however, due to inherent uncertainties in making estimates, actual results could differ from the original estimates, requiring adjustments to these balances in future periods.

The critical accounting estimates that affect the audited consolidated financial statements and that use judgments and assumptions are listed below. In addition, the likelihood that materially different amounts could be reported under varied conditions and assumptions is discussed.

Pension

We sponsor both noncontributory and contributory defined benefit pension plans. The majority of the plans are funded plans. The noncontributory pension plans cover certain of our hourly and salaried employees. Benefits are based on a fixed rate for each year of service. Additionally, contributory benefits are provided to certain of our salaried employees under the salaried employees’ retirement plans. These plans provide benefits based on the employee’s cumulative contributions, years of service during which the employee contributions were made and the employee’s average salary during the five consecutive years in which the employee’s salary was highest in the 15 years preceding retirement.

Our defined benefit pension plans are accounted for on an actuarial basis, which requires that we make use of estimates of the present value of the projected future payments to all participants, taking into consideration the likelihood of potential future events such as demographic experience. These assumptions may have an effect on the amount and timing of future contributions.

The assumptions used in developing the required estimates include the following key factors:

• Discount rates.Our discount rates are based on yields of high-quality (AA-rated or better) fixed income investments for which the timing and amounts of payments match the timing and amounts of the projected pension payments.

• Expected return on plan assets.Our expected long-term rate of return on plan assets assumption is developed using a consistent approach across all plans. This approach primarily considers various inputs from a range of advisors for long-term capital market returns, inflation, bond yields and other variables, adjusted for specific aspects of our investment strategy.

• Salary growth.Our salary growth assumption reflects our long-term actual experience, outlook and assumed inflation.

• Inflation.Our inflation assumption is based on an evaluation of external market indicators.

• Expected contributions.Our expected amount and timing of contributions is based on an assessment of minimum funding requirements. From time to time contributions are made beyond those that are legally required.

• Retirement rates.Retirement rates are developed to reflect actual and projected plan experience.

• Mortality rates. Mortality rates are developed to reflect actual and projected plan experience.

Plan Assets Measured at Net Asset Value. Plan assets are recognized and measured at fair value in accordance with the accounting guidance related to fair value measurements, which specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques (Level 1, 2 and 3). Level 3 pricing inputs include significant inputs that are generally less observable from objective sources. At December 31, 2013, substantially

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all of our investments classified as Level 3 in the fair value hierarchy are valued at the net asset value, or NAV. These plan assets are classified as Level 3 as there are no active markets for these assets and they are valued using unobservable inputs.

Our investments classified as Level 3 include private equity, real estate and hedge fund investments. Private equity investments include those in limited partnerships that invest primarily in operating companies that are not publicly traded on a stock exchange. Our private equity investment strategies include leveraged buyouts, venture capital, mezzanine and distressed investments. Real estate investments include those in limited partnerships that invest in various commercial and residential real estate projects both domestically and internationally. Hedge fund investments include those seeking to maximize absolute returns using a broad range of strategies to enhance returns and provide additional diversification. Investments in limited partnerships are valued at the NAV, which is based on audited financial statements of the funds when available, with adjustments to account for partnership activity and other applicable valuation adjustments.

Refer to Note 2, Basis of Presentation and Significant Accounting Policies, and Note 18,Employee Retirement and Other Benefits, of our accompanying audited consolidated financial statements for a discussion of the fair value hierarchy measurement.

Plan obligations and costs are based on existing retirement plan provisions, which include plan amendments with certain provisions taking effect in future periods. We do not make assumptions regarding any potential future changes to benefit provisions beyond those to which we are presently committed.

Significant differences in actual experience or significant changes in assumptions may affect the pension obligations and pension expense. The effect of actual results differing from assumptions and of changing assumptions are included in accumulated other comprehensive income (loss), or AOCI, as unrecognized actuarial gains and losses. These gains and losses are subject to amortization to expense over the average future service period of plan participants expected to receive benefits under the plans to the extent they exceed 10 percent of the higher of the market related value of assets or the projected benefit obligation of the respective plan. For inactive pension plans, we amortize actuarial gains or losses to expense over the remaining life of plan participants. During 2013, the actual return on plan assets was $1,640 million, which was lower than the expected return of $1,843 million, resulting in an unrecognized actuarial loss of $203 million. The weighted average discount rate used to determine the benefit obligation for defined benefit pension plans was 4.69 percent at December 31, 2013 versus 3.98 percent at December 31, 2012, resulting in an unrecognized actuarial gain of $2,135 million, excluding the impact of the interim remeasurement to the U.S. and Canadian salaried defined benefit pension plans, as described below. In 2014, $85 million of net unrecognized actuarial losses are expected to be recognized into expense.

During the second quarter of 2013, we amended our U.S. and Canadian salaried defined benefit pension plans. The U.S. plans were amended in order to comply with IRS regulations, cease the accrual of future benefits effective December 31, 2013, and enhance the retirement factors. The Canada amendment ceases the accrual of future benefits effective December 31, 2014, enhances the retirement factors and continues to consider future salary increases for the affected employees. The changes to the plans resulted in an interim remeasurement of the plans, as well as a curtailment gain and plan amendments. As a result, we recognized a $780 million net reduction to our pension obligation, a $9 million reduction to prepaid pensions, and a corresponding $771 million increase in AOCI.

The funded status of our pension plans as of December 31, 2013 and the expenses to be recognized during 2014 are affected by year end 2013 assumptions. These sensitivities may be asymmetric and are specific to the time periods noted. They also may not be additive, so the impact of changing multiple factors simultaneously cannot

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be calculated by combining the individual sensitivities shown. The effect of the indicated increase (decrease) in selected factors, holding all other assumptions constant, is shown below (in millions of dollars):

	Pension Plans
	Effect on 2014 Pension Expense			Effect on December 31, 2013 Projected Benefit Obligation
10 basis point decrease in discount rate	$	9		$	348
10 basis point increase in discount rate		(9	)		(342	)
50 basis point decrease in expected return on assets		123			—
50 basis point increase in expected return on assets		(123	)		—

Refer to Note 18,Employee Retirement and Other Benefits, of the accompanying audited consolidated financial statements for a detailed discussion of our pension plans.

Other Postretirement Employee Benefits

We provide health care, legal and life insurance benefits to certain of our hourly and salaried employees. Upon retirement from the Company, these employees may become eligible for continuation of certain benefits. Benefits and eligibility rules may be modified periodically.

Other postretirement employee benefits, or OPEB, plans are accounted for on an actuarial basis, which requires the selection of various assumptions. The estimation of our obligations, costs and liabilities associated with OPEB, primarily retiree health care and life insurance, requires that we make use of estimates of the present value of the projected future payments to all participants, taking into consideration the likelihood of potential future events such as health care cost increases and demographic experience, which may have an effect on the amount and timing of future payments.

The assumptions used in developing the required estimates include the following key factors:

• Discount rates.Our discount rates are based on yields of high-quality (AA-rated or better) fixed income investments for which the timing and amounts of payments match the timing and amounts of the projected benefit payments.

• Health care cost trends.Our health care cost trend assumptions are developed based on historical cost data, the near-term outlook, and an assessment of likely long-term trends.

• Salary growth.Our salary growth assumptions reflect our long-term actual experience, outlook and assumed inflation.

• Retirement rates.Retirement rates are developed to reflect actual and projected plan experience.

• Mortality rates.Mortality rates are developed to reflect actual and projected plan experience.

Plan obligations and costs are based on existing OPEB plan provisions. We do not make assumptions regarding any potential future changes to benefit provisions beyond those to which we are presently committed.

The effect of actual results differing from assumptions and of changing assumptions are included in AOCI as unrecognized actuarial gains and losses. These gains and losses are subject to amortization to expense over the average future service period of plan participants expected to receive benefits under the plan to the extent they exceed 10 percent of the higher of the market related value of assets or the accumulated benefit obligation of the

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respective plan. We immediately recognize actuarial gains or losses for OPEB plans that are short-term in nature and under which our obligation is capped. The weighted average discount rate used to determine the benefit obligation for OPEB plans was 4.87 percent at December 31, 2013 versus 4.07 percent at December 31, 2012, resulting in an unrecognized actuarial gain of $281 million. In 2014, $23 million of net unrecognized actuarial losses are expected to be recognized into expenses.

The effect of the indicated increase (decrease) in the assumed discount rate, holding all other assumptions constant, is shown below (in millions of dollars):

	OPEB Plans
	Effect on 2014 OPEB Expense			Effect on December 31, 2013 OPEB Obligation
10 basis point decrease in discount rate	$	2		$	33
10 basis point increase in discount rate		(2	)		(33	)

Refer to Note 18,Employee Retirement and Other Benefits, of our accompanying audited consolidated financial statements for more information regarding costs and assumptions for our OPEB plans.

Share-Based Compensation

We have various compensation plans that provide for the granting of share-based compensation to certain employees and directors. We account for share-based compensation plans in accordance with the accounting guidance set forth for share-based payments, which requires share-based compensation expense to be recognized based on fair value. Compensation expense for equity-classified awards is measured at the grant date based on the fair value of the award using a discounted cash flow methodology. For those awards with post-vesting contingencies, an adjustment is applied to account for the probability of meeting the contingencies. Liability-classified awards are remeasured to fair value at each balance sheet date until the award is settled. Compensation expense is recognized over the employee service period with an offsetting increase to contributed capital or accrued expenses and other liabilities depending on the nature of the award. If awards contain certain performance conditions in order to vest, the cost of the award is recognized when achievement of the performance condition is probable. Costs related to plans with graded vesting are generally recognized using the graded vesting method. Share-based compensation expense is recorded in Selling, Administrative and Other Expenses in the accompanying Consolidated Statements of Income.

The fair value of each unit issued under the plans is based on the fair value of our membership interests. Each unit, or Chrysler Group Unit, is equal to 1/600th of the value of a Class A Membership Interest, which equates to approximately 980 million Chrysler Group Units. Refer to Note 17,Share-Based Compensation, of our accompanying audited consolidated financial statements for additional information.

Since there is no publicly observable trading price for our membership interests, fair value was determined contemporaneously with each measurement using a discounted cash flow methodology. We use this approach, which is based on our projected cash flows, to estimate our enterprise value. We then deduct the fair value of our outstanding interest bearing debt as of the measurement date from our enterprise value to arrive at the fair value of equity. This amount is then divided by the total number of Chrysler Group Units, as determined above, to estimate the fair value of a single Chrysler Group Unit. The significant assumptions used in the calculation of fair value at each issuance date and for each period included the following:

• Four years of annual projections prepared by management that reflect the estimated after-tax cash flows a market participant would expect to generate from operating the business;

• A terminal value which was determined using a growth model that applied a 2.0 percent long-term growth rate to our projected after-tax cash flows beyond the four year window. The long-term growth rate was based on our internal projections, as well as industry growth prospects;

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• An estimated after-tax weighted average cost of capital ranging from 16.0 percent to 16.5 percent in both 2013 and 2012, and 14.4 percent to 16.5 percent in 2011; and

• Projected worldwide factory shipments ranging from approximately 2.4 million vehicles in 2012 to approximately 3.3 million vehicles in 2017.

In 2011, the implied fair value of the Company, resulting from the transactions through which Fiat acquired beneficial ownership of the membership interests previously held by the U.S. Treasury and Canadian Government, was used to corroborate the values determined using the discounted cash flow methodology. There were no such transactions during 2012 and 2013. On January 21, 2014, Fiat acquired the VEBA Trust’s remaining membership interest in Chrysler Group. Refer to Note 25,Subsequent Events, of our accompanying audited consolidated financial statements for additional information. The implied fair value of the Company resulting from this transaction, along with certain other factors, was used to corroborate the fair value determined at December 31, 2013 using our discounted cash flow methodology.

Based on the discounted cash flow methodology, the per unit fair value of a Chrysler Group Unit, calculated based on the Chrysler Group Units of 980 million, was $10.47, $9.00 and $7.63 at December 31, 2013, 2012 and 2011, respectively. All per unit fair values include a discount for lack of marketability of 10 percent. The increase in the fair value of a Chrysler Group Unit was primarily attributable to our continued progress and achievement of certain objectives outlined in our business plan.

The assumptions noted above used in the contemporaneous estimation of fair value at each measurement date have not changed significantly with the exception of the weighted average cost of capital, which is directly influenced by external market conditions. As of December 31, 2013, a change of 50 basis points in the weighted average cost of capital would cause the value of a Chrysler Group Unit to change by approximately $0.64, which would change our share-based compensation liability by approximately $8 million.

Impairment of Long-Lived Assets

Long-lived assets held and used (such as property, plant and equipment, and equipment and other assets on operating leases) are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability of an asset or asset group to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or group of assets. If the carrying amount of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset or group of assets exceeds the fair value of the asset or group of assets. No impairment indicators were identified during the years ended December 31, 2013, 2012 and 2011. As such, no impairment charges were recognized during the respective periods. When long-lived assets are considered held for sale, they are recorded at the lower of carrying amount or fair value less costs to sell, and depreciation ceases.

Goodwill and Other Intangible Assets

We account for goodwill in accordance with the accounting guidance related to intangibles and goodwill, which requires us to test goodwill for impairment at the reporting unit level at least annually and when significant events occur or there are changes in circumstances that indicate the fair value is less than the carrying amount. Such events could include, among others, a significant adverse change in the business climate, an unanticipated change in the competitive environment and a decision to change the operations of the Company. We have one operating segment, which is also our only reporting unit.

Goodwill is evaluated for impairment annually as of October 1. In September 2011, the Financial Accounting Standards Board, or FASB, issued updated guidance on annual goodwill impairment testing. The amendment

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allows an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. At our election, we can qualitatively assess whether it is more likely than not that the fair value of our reporting unit is less than its carrying amount or we can perform a quantitative assessment by the comparing the fair value of our reporting unit to its carrying amount, including goodwill, which is the first step of the two-step process described below. If we elect to perform the qualitative assessment and we conclude it is more likely than not that the fair value of the reporting unit is less than its carrying amount, quantitative impairment testing is required. However, if we conclude otherwise, quantitative impairment testing is not required.

When quantitative impairment testing is required as a result of the qualitative test or elected as the first assessment, goodwill is reviewed for impairment utilizing a two-step process. The first step of the impairment test is to compare the fair value of our reporting unit to its carrying amount. The fair value is determined by estimating the present value of expected future cash flows for the reporting unit. If the fair value of the reporting unit is greater than its carrying amount, no impairment exists and the second step of the test is not performed. If the carrying amount of the reporting unit is greater than the fair value, there is an indication that an impairment may exist and the second step of the test must be completed to measure the amount of the impairment. The second step of the test calculates the implied fair value of goodwill by assigning the fair value of the reporting unit to all of the assets and liabilities of that unit as if the reporting unit had been acquired in a business combination. The implied fair value of goodwill is then compared to the carrying value. If the implied fair value of goodwill is less than the carrying value, an impairment loss is recognized equal to the difference. As discussed in—Valuation of Deferred Tax Assets below, we reversed portions of the valuation allowance recorded against our deferred tax assets and the carrying value of our reporting unit increased significantly. We considered the release of our valuation allowances as a triggering event and we elected to perform a quantitative impairment test as of December 31, 2013. No goodwill impairment losses have been recognized for the years ended December 31, 2013, 2012 and 2011.

Intangible assets that have a finite useful life are generally amortized over their respective estimated useful lives, on a straight-line basis. However, certain other finite-lived intangible assets are amortized in a manner that reflects the pattern in which the economic benefits of the intangible asset will be consumed. The estimated useful lives of intangible assets are reviewed by management each reporting period and whenever changes in circumstances indicate that the carrying value of the assets may not be recoverable. Other intangible assets determined to have an indefinite useful life are not amortized, but are instead tested for impairment annually. In July 2012, the FASB issued updated guidance on the annual testing of indefinite-lived intangible assets for impairment. The amendments allow an entity to first assess qualitative factors to determine whether it is more likely than not that the indefinite-lived intangible asset is impaired. At our election, we can qualitatively assess whether it is more likely than not that the fair value of our indefinite-lived intangible asset is less than its carrying value or we can perform a quantitative assessment by comparing the fair value of our indefinite-lived intangible asset to its carrying amount. If we elect to perform the qualitative assessment and we conclude it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if we conclude otherwise, quantitative impairment testing is not required. An impairment loss is recognized to the extent that the carrying amount exceeds the asset’s fair value. Management estimates fair value through various techniques including discounted cash flow models, which incorporate market based inputs, and third party independent appraisals, as considered appropriate. Management also considers current and estimated economic trends and outlook. No impairment losses on these assets have been recognized for the years ended December 31, 2013, 2012 and 2011.

Valuation of Deferred Tax Assets

A valuation allowance on deferred tax assets is required if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon our ability to generate sufficient taxable income during the carryback or carryforward periods applicable in each relevant tax jurisdiction. Our accounting for deferred tax assets represents our best estimate of

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those future events. Changes in our current estimates, due to unanticipated events or otherwise, could have a material impact on our financial condition and results of operations.

In assessing the realizability of deferred tax assets, we consider both positive and negative evidence. Concluding that a valuation allowance is not required is difficult when there is absence of positive evidence and there is significant negative evidence which is objective and verifiable, such as cumulative losses in recent years. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income exclusive of reversing taxable temporary differences to outweigh objective negative evidence of recent financial reporting losses. Cumulative losses in recent years is a significant piece of negative evidence that is difficult to overcome in determining that a valuation allowance is not needed against deferred tax assets.

The assessment for the nature, timing and recognition of a valuation allowance takes into account a number of types of evidence, including the following:

• Nature, frequency and severity of current and cumulative financial reporting losses. A pattern of objectively measured recent financial reporting income or losses is heavily weighted as a source of positive or negative evidence. In certain circumstances, historical information may not be as relevant due to changed circumstances;

• Sources of future taxable income. Future reversals of existing temporary differences are heavily-weighted sources of objectively verifiable positive evidence. Projections of future taxable income exclusive of reversing temporary differences are a source of positive evidence when the projections are combined with a history of recent profits and can be reasonably estimated. Otherwise, these projections are considered inherently subjective and generally will not be sufficient to overcome negative evidence that includes relevant cumulative losses in recent years, particularly if the projected future taxable income is dependent on an anticipated turnaround to profitability that has not yet been achieved. In such cases, these projections of future taxable income are given little weight for the purposes of valuation allowance assessment; and

• Tax planning strategies. If necessary and available, tax planning strategies would be implemented to accelerate taxable amounts to utilize expiring carryforwards. These strategies would be a source of additional positive evidence and, depending on their nature, could be heavily weighted.

Our deferred tax assets consist primarily of those of our subsidiaries in foreign jurisdictions. Our subsidiaries in foreign jurisdictions are highly dependent on our North American operations, which consists primarily of our U.S. operations. As of the fourth quarter 2013, we have demonstrated sustained cumulative profitability considering the achievements of our 2010-2014 Business Plan and the supporting operational results evidenced by the improvements to product mix, international sales and the successful product launches. As such, the sustained profitability of our North American, primarily U.S., operations provided positive evidence which outweighs the negative evidence, supporting release of the valuation allowance at a majority of our foreign subsidiaries and also for the U.S. state deferred tax asset.

We believe that sustained and consistent profitability has been demonstrated by the following factors:

• continued positive progress on our 2010-2014 Business Plan, including achievement of a substantial portion of our 2013 financial and performance objectives;

• continued improvement in our product mix;

• increased vehicle sales volume outside of North America; and

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• our ability to successfully launch products, particularly those using a Fiat or jointly developed platform.

In addition to the positive factors indicated above, we have also undergone significant changes in our management and business strategies since the 363 Transaction, as well as implemented several new product development programs. Fiat’s acquisition of the remainder of the Chrysler Group membership interests from the VEBA Trust on January 21, 2014, solidifies our alliance with Fiat. Through the Fiat-Chrysler Alliance, we have launched the all-new 2014 Jeep Cherokee, the all new Fiat 500L and the all-new Ram ProMaster utilizing Fiat or jointly developed platforms. The market acceptance and fourth quarter 2013 shipments of these new product introductions have provided an additional positive indicator of our progress towards achievement of our performance objectives and our continued improvement in our product mix objectives. Our alliance with Fiat has enabled us, and will continue to enable us, to accelerate our positive transformation by providing us access to smaller, more fuel efficient vehicles and technologies for vehicle segments where we have been historically underrepresented.

As a result of reaching sustained profitability and further evidenced by the additional positive evidence of Fiat now owning 100 percent of us, our conclusion regarding the need for valuation allowances on our net deferred tax assets with respect to our foreign subsidiaries has changed, resulting in the reversal of $962 million of the valuation allowances as of December 31, 2013, of which $956 million pertains to the net deferred tax assets balance as of December 31, 2012. Refer to Note 13,Income Taxes, of our accompanying audited consolidated financial statements for additional information. A significant tax benefit related to the valuation allowance release was recorded, which resulted in a negative effective tax rate.

We have retained $151 million of valuation allowances on our net deferred tax assets, primarily in certain foreign countries which we do not expect to realize the deferred tax assets.

Sales Incentives

We record the estimated cost of sales incentive programs offered to dealers and consumers as a reduction to revenue at the time of sale to the dealer. This estimated cost represents the incentive programs offered to dealers and consumers, as well as the expected modifications to these programs in order to facilitate sales of the dealer inventory. Subsequent adjustments to incentive programs related to vehicles previously sold to dealers are recognized as an adjustment to revenue in the period the adjustment is determinable.

We use price discounts to adjust vehicle pricing in response to a number of market and product factors, including: pricing actions and incentives offered by competitors, economic conditions, the amount of excess industry production capacity, the intensity of market competition, consumer demand for the product and to support promotional campaigns. We may offer a variety of sales incentive programs at any given point in time, including: cash offers to dealers and consumers and subvention programs offered to customers, or lease subsidies, which reduce the retail customer’s monthly lease payment or cash due at the inception of the financing arrangement, or both. Incentive programs are generally brand, model and region specific for a defined period of time, which may be extended.

Multiple factors are used in estimating the future incentive expense by vehicle line including the current incentive programs in the market, planned promotional programs and the normal incentive escalation incurred as the model year ages. The estimated incentive rates are reviewed monthly and changes to the planned rates are adjusted accordingly, thus impacting revenues. As discussed previously, there are a multitude of inputs affecting the calculation of the estimate for sales incentives, and an increase or decrease of any of these variables could have a significant effect on recorded revenues.

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Warranty and Product Recalls

We establish reserves for product warranties at the time the sale is recognized. We issue various types of product warranties under which we generally guarantee the performance of products delivered for a certain period or term. The reserve for product warranties includes the expected costs of warranty obligations imposed by law or contract, as well as the expected costs for policy coverage, recall actions and buyback commitments. The estimated future costs of these actions are principally based on assumptions regarding the lifetime warranty costs of each vehicle line and each model year of that vehicle line, as well as historical claims experience for our vehicles. In addition, the number and magnitude of additional service actions expected to be approved, and policies related to additional service actions, are taken into consideration. Due to the uncertainty and potential volatility of these estimated factors, changes in our assumptions could materially affect our results of operations.

We periodically initiate voluntary service and recall actions to address various customer satisfaction, safety and emissions issues related to vehicles we sell. Included in the reserve is the estimated cost of these service and recall actions. The estimated future costs of these actions are based primarily on historical claims experience for our vehicles. Estimates of the future costs of these actions are inevitably imprecise due to numerous uncertainties, including the enactment of new laws and regulations, the number of vehicles affected by a service or recall action and the nature of the corrective action. It is reasonably possible that the ultimate cost of these service and recall actions may require us to make expenditures in excess of established reserves over an extended period of time and in a range of amounts that cannot be reasonably estimated. Our estimate of warranty and additional service and recall action obligations is re-evaluated on a quarterly basis. Experience has shown that initial data for any given model year can be volatile; therefore, our process relies upon long-term historical averages until actual data is available. As actual experience becomes available, it is used to modify the historical averages to ensure that the forecast is within the range of likely outcomes. Resulting accruals are then compared with current spending rates to ensure that the balances are adequate to meet expected future obligations.

Accounting Standards Not Yet Adopted

Accounting standards not yet adopted are discussed in Note 2,Basis of Presentation and Significant Accounting Policies, of our accompanying audited consolidated financial statements.

Non-GAAP Financial Measures

We monitor our operations through the use of several non-GAAP financial measures: Adjusted Net Income (Loss); Modified Operating Profit (Loss); Modified Earnings Before Interest, Taxes, Depreciation and Amortization, which we refer to as Modified EBITDA; Net Industrial Cash (Debt); as well as Free Cash Flow. We believe that these non-GAAP financial measures provide useful information about our operating results and enhance the overall ability to assess our financial performance. They provide us with comparable measures of our financial performance based on normalized operational factors which then facilitate management’s ability to identify operational trends, as well as make decisions regarding future spending, resource allocations and other operational decisions. These and similar measures are widely used in the industry in which we operate.

These financial measures may not be comparable to other similarly titled measures of other companies and are not an alternative to net income (loss) or income (loss) from operations as calculated and presented in accordance with U.S. GAAP. These measures should not be used as a substitute for any U.S. GAAP financial measures.

Adjusted Net Income (Loss)

Adjusted Net Income (Loss) is defined as net income (loss) excluding the impact of infrequent items, which includes losses on extinguishment of debt and the release of valuation allowances on deferred tax assets. We use Adjusted Net Income (Loss) as a key indicator of the trends in our overall financial performance, excluding the impact of such infrequent items.

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Modified Operating Profit (Loss)

We measure Modified Operating Profit (Loss) to assess the performance of our core operations, establish operational goals and forecasts that are used to allocate resources, and evaluate our performance period over period. Modified Operating Profit (Loss) is computed starting with net income (loss), and then adjusting the amount to (i) add back income tax expense and exclude income tax benefits (excluding the effects of the release of valuation allowances on deferred tax assets), (ii) add back net interest expense (excluding interest expense related to financing activities associated with the Gold Key Lease vehicle lease portfolio), (iii) add back (exclude) all pension, OPEB and other employee benefit costs (gains) other than service costs, (iv) add back restructuring expense and exclude restructuring income, (v) add back other financial expense, (vi) add back losses and exclude gains due to cumulative change in accounting principles, and (vii) add back certain other costs, charges and expenses, which include the charges factored into the calculation of Adjusted Net Income (Loss). We also use performance targets based on Modified Operating Profit (Loss) as a factor in our incentive compensation calculations for our represented and non-represented employees.

Modified EBITDA

We measure the performance of our business using Modified EBITDA to eliminate the impact of items that we do not consider indicative of our core operating performance. We compute Modified EBITDA starting with net income (loss) adjusted to Modified Operating Profit (Loss) as described above, and then add back depreciation and amortization expense (excluding depreciation and amortization expense for vehicles held for lease). We believe that Modified EBITDA is useful to determine the operational profitability of our business, which we use as a basis for making decisions regarding future spending, budgeting, resource allocations and other operational decisions.

The reconciliation of net income to Adjusted Net Income, Modified Operating Profit and Modified EBITDA is set forth below (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Net income	$	2,757	$	1,668	$	183
Plus:
Deferred tax assets valuation allowance release		(962)		—		—
Loss on extinguishment of debt (1)(2)		24		—		551
Adjusted Net Income	$	1,819	$	1,668	$	734
Plus:
Income tax expense (3)		409		274		198
Net interest expense		994		1,050		1,199
Net pension, OPEB and other employee benefit gains other than service costs		(49)		(34)		(170)
Restructuring (income) expenses, net		(14)		(61)		3
Other financial expense, net		17		15		11
Modified Operating Profit	$	3,176	$	2,912	$	1,975
Plus:
Depreciation and amortization expense		2,941		2,701		2,876
Less:
Depreciation and amortization expense for vehicles held for lease		(198)		(163)		(97)
Modified EBITDA	$	5,919	$	5,450	$	4,754

(1) In connection with the June 2013 amendment of our Senior Credit Facilities and December 2013 re-pricing of the Tranche B Term Loan, we recognized a $24 million loss on extinguishment of debt. The loss consisted of the write off of

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$13 million of unamortized debt discounts and $3 million of unamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of call premium and other fees associated with the amendments. Refer to Note 12, Financial Liabilities, of our accompanying audited consolidated financial statements for additional information.

(2) In connection with the May 2011 repayment of our outstanding obligations under the U.S. Treasury first lien credit facilities and the EDC Credit Facilities, we recognized a $551 million loss on extinguishment of debt. The charges consisted of the write-off of $136 million of unamortized discounts and $34 million of unamortized debt issuance costs associated with the U.S. Treasury credit facilities and $367 million of unamortized discounts and $14 million of unamortized debt issuance costs associated with the EDC credit facilities. Refer to Note 12, Financial Liabilities, of our accompanying audited consolidated financial statements for additional information.

(3) Excludes the effects of a $962 million non-cash tax benefit related to the release of valuation allowances on deferred tax assets. Refer to Note 13, Income Taxes, of our accompanying audited consolidated financial statements for additional information.

Net Industrial Cash (Debt)

We compute Net Industrial Cash (Debt) as cash and cash equivalents less total financial liabilities. We use Net Industrial Cash (Debt) as a measure of our financial leverage and believe it is useful to others in evaluating our financial leverage.

The following is a reconciliation of cash and cash equivalents to Net Industrial Cash (Debt) (in millions of dollars):

	Years Ended December 31,
	2013			2012
Cash and cash equivalents	$	13,344		$	11,614
Less: Financial liabilities (1)		(12,301	)		(12,603	)
Net Industrial Cash (Debt)	$	1,043		$	(989	)

(1) Refer to Note 12,Financial Liabilities, of our accompanying audited consolidated financial statements for additional information regarding our financial liabilities.

Free Cash Flow

Free Cash Flow is defined as cash flows from operating and investing activities, excluding any debt related investing activities, adjusted for financing activities related to Gold Key Lease. We are currently winding down the Gold Key Lease program. As of June 2012, all Gold Key Lease financing obligations had been repaid and no additional funding will be required. Free Cash Flow is presented because we believe that it is used by analysts and other parties in evaluating the Company. However, Free Cash Flow does not necessarily represent cash available for discretionary activities, as certain debt obligations and capital lease payments must be funded out of Free Cash Flow. We also use performance targets based on Free Cash Flow as a factor in our incentive compensation calculations for our non-represented employees.

Free Cash Flow should not be considered as an alternative to, or substitute for, net change in cash and cash equivalents. We believe it is important to view Free Cash Flow as a complement to our accompanying cash flows.

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The following is a reconciliation of Net Cash Provided by (Used In) Operating and Investing Activities to Free Cash Flow (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Net Cash Provided by Operating Activities	$	5,536	$	5,821	$	4,603
Net Cash Used in Investing Activities		(3,413)		(3,557)		(1,970)
Investing activities excluded from Free Cash Flow:
Proceeds from USDART (1)		—		—		(96)
Change in loans and notes receivables		—		(2)		(6)
Financing activities included in Free Cash Flow:
Repayments of Gold Key Lease financing		—		(41)		(584)
Free Cash Flow	$	2,123	$	2,221	$	1,947

(1) U.S. Dealer Automotive Receivables Transition LLC, or USDART, as described below under—Liquidity and Capital Resources —Ally MTA.

Results of Operations

Worldwide Factory Shipments

The following summarizes our gross and net worldwide factory shipments, which include vehicle sales to our dealers, distributors, and contract manufacturing customers. Management believes that this data provides meaningful information regarding our operating results. Shipments of vehicles manufactured by our assembly facilities are generally aligned with current period production, which is driven by consumer demand. Revenue is generally recognized when the risks and rewards of ownership of a vehicle have been transferred to our customer, which usually occurs upon release of the vehicle to the carrier responsible for transporting the vehicle to our customer.

Dealers and distributors sell our vehicles to retail customers and fleet customers. Our fleet customers include rental car companies, commercial fleet customers, leasing companies and governmental entities. Our fleet shipments include vehicle sales through our GDP, under which we guarantee the residual value or otherwise assume responsibility for the minimum resale value of the vehicle. We account for such sales similar to an operating lease and recognize rental income over the contractual term of the lease on a straight-line basis. At the end of the lease term, we recognize revenue for the portion of the vehicle sales price which had not been previously recognized as rental income and recognize, in cost of sales, the remainder of the cost of the vehicle which had not been previously recognized as depreciation expense over the lease term. We include GDP vehicle sales in our net worldwide factory shipments at the time of auction, rather than at the time of sale to the fleet customer, consistent with the timing of revenue recognition. We consider these net worldwide factory shipments to approximate the timing of revenue recognition.

	Years Ended December 31,
	2013		2012		2011
	(vehicles in thousands)
Retail		2,033		1,844		1,507
Fleet		470		484		441
Contract Manufacturing		60		81		63
Worldwide Factory Shipments		2,563		2,409		2,011
Adjust for GDP activity during the period:
Less: Vehicles shipped		(79)		(51)		(76)
Plus: Vehicles auctioned		58		74		58
Net Worldwide Factory Shipments		2,542		2,432		1,993

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Consolidated Results

The following is a discussion of the results of operations for the year ended December 31, 2013 as compared to the year ended December 31, 2012, and for the year ended December 31, 2012 as compared to the year ended December 31, 2011. The discussion of certain line items (cost of sales, gross margin, selling, administrative and other expenses, and research and development expenses) includes a presentation of such line items as a percentage of revenues, for the respective periods presented, to facilitate the discussion for the year over year comparisons.

Revenues, Net

	Years Ended December 31,						Increase (Decrease)
	2013		2012		2011		2013 vs. 2012			2012 vs. 2011
	(in millions of dollars)
Revenues, net	$	72,144	$	65,784	$	54,981	$	6,360	9.7%	$	10,803	19.6%

2013 Compared to 2012.Revenues for the year ended December 31, 2013 increased $6,360 million as compared to the year ended December 31, 2012. Approximately $2.8 billion of the increase was due to an increase in our net worldwide factory shipments from 2,432 thousand vehicles for the year ended December 31, 2012 to 2,542 thousand vehicles for the year ended December 31, 2013. The increase in our net worldwide factory shipments was driven primarily by increased demand for our vehicles, including the Ram 1500, the launch of the all-new 2014 Jeep Cherokee, which began shipping to dealers in late October 2013, the Jeep Grand Cherokee, which launched in the first quarter of 2013, as well as increases in the Jeep Wrangler. These increases were partially offset by a reduction in Jeep Liberty shipments due to its discontinued production at the end of the second quarter of 2012 in preparation of the all-new 2014 Jeep Cherokee. During the second half of 2012 we continued to ship the residual Jeep Liberty inventory to dealers.

Overall, demand for our vehicles has increased, as evidenced by a nine percent period over period increase in our U.S. vehicle sales, which was primarily driven by a 14 percent increase in our U.S. retail sales for the year ended December 31, 2013 as compared to the same period in 2012. Our U.S. market share increased by 20 basis points to 11.4 percent for the year ended December 31, 2013 as compared to the same period in 2012.

Approximately $1.4 billion of the increase in revenues was attributable to favorable vehicle mix as there was a higher percentage growth in truck and certain SUV shipments as compared to minivan and passenger car shipments. In addition, revenues increased by approximately $1.2 billion as a result of favorable net pricing from vehicle content enhancements in our 2014 model year vehicles as compared to prior model years. Further, approximately $900 million of the increase in revenues was due to a favorable shift in market mix to greater retail shipments as a percentage of total shipments, which is consistent with our continuing strategy to grow our U.S. retail market share while maintaining stable fleet shipments. Typically, the average revenue per vehicle for retail shipments is higher than the average revenue per vehicle for fleet shipments, as our retail customers tend to purchase vehicles with more optional features. For additional information regarding retail and fleet shipments, refer to —Worldwide Factory Shipmentsabove.

During the first quarter of 2013, we recognized a $78 million foreign currency translation loss as a reduction to revenues as a result of the February 2013 devaluation of the official exchange rate of the Venezuelan bolivar, or VEF, relative to the USD from 4.30 VEF per USD to 6.30 VEF per USD. Subsequent to the devaluation, certain monetary liabilities, which had been submitted to the CADIVI for payment approval through the ordinary course of business prior to the devaluation date, were approved to be paid at an exchange rate of 4.30 VEF per USD. As a result, during the year ended December 31, 2013, we recognized $22 million of foreign currency transaction gains in revenues due to these monetary liabilities being previously remeasured at 6.30 VEF per USD at the devaluation date. Refer to—Quantitative and Qualitative Disclosures about Market Riskbelow, for additional information regarding Venezuela currency regulations and devaluation.

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2012 Compared to 2011. Revenues for the year ended December 31, 2012 increased $10,803 million as compared to the year ended December 31, 2011, approximately $11.2 billion of which was attributable to an increase in our net worldwide factory shipments from 1,993 thousand vehicles for the year ended December 31, 2011 to 2,432 thousand vehicles for the year ended December 31, 2012. The 22 percent increase in our net worldwide factory shipments was driven primarily by increased demand for our vehicles, as evidenced by an increase in our U.S. market share from 10.5 percent for the year ended December 31, 2011 to 11.2 percent for the year ended December 31, 2012. In addition, the increase in our shipments was due to the continued improvement in the U.S. automotive market, which experienced a 13 percent increase in industry vehicle sales for the year ended December 31, 2012 as compared to the same period in 2011.

Approximately $900 million of the revenues increase was attributable to more favorable net pricing of our 2012 and 2013 model year vehicles as compared to the prior model years, which was driven by our ability to adjust prices for our vehicle content enhancements in the current market. Additionally, approximately $100 million of the revenues increase was due to a favorable shift in market mix to greater retail shipments as a percentage of total shipments, which is consistent with our continued plan to grow the U.S. retail market while maintaining stable U.S. fleet shipments. Typically, the average revenue per vehicle for retail shipments is higher than the average revenue per vehicle for fleet shipments, as our retail customers tend to purchase larger vehicles with more optional features. For additional information regarding retail and fleet shipments, refer to —Worldwide Factory Shipmentsabove.

These increases were partially offset by a decrease in revenues of approximately $2.0 billion as a result of a higher percentage growth in passenger car shipments as compared to truck and SUV shipments, as well as consumers purchasing vehicles with option packages that group commonly selected options at a value price. The options include, but are not limited to, Uconnect Touch, keyless entry, leather seats and/or DVD systems being included as standard features in certain vehicles.

Cost of Sales

	Years Ended December 31,												Increase (Decrease)
	2013		Percentage of Revenues		2012		Percentage of Revenues		2011		Percentage of Revenues		2013 vs. 2012			2012 vs. 2011
	(in millions of dollars)
Cost of sales	$	61,398		85.1%	$	55,350		84.1%	$	46,422		84.4%	$	6,048	10.9%	$	8,928	19.2%
Gross margin		10,746		14.9%		10,434		15.9%		8,559		15.6%		312	3.0%		1,875	21.9%

We procure a variety of raw materials, parts, supplies, utilities, transportation and other services from numerous suppliers to manufacture our vehicles, parts and accessories, primarily on a purchase order basis. The raw materials we use typically consist of steel, aluminum, resin, copper, lead, and precious metals including platinum, palladium and rhodium. The cost of materials and components makes up a majority of our cost of sales, which was approximately 76 percent, 76 percent and 74 percent for the years ended December 31, 2013, 2012 and 2011, respectively. The remaining costs primarily include labor costs consisting of direct and indirect wages and fringe benefits as well as depreciation (including that related to our GDP vehicles), amortization, transportation costs, warranty and product-related costs. Fluctuations in costs of sales are primarily driven by the number of vehicles that we produce and sell. In addition, we incur additional costs associated with the launch of new vehicles and powertrains, such as labor inefficiencies, additional vehicle testing and validation, as well as training costs. However, we are able to partially offset these costs by improved productivity and cost savings achieved through our WCM initiatives.

2013 Compared to 2012.Cost of sales for the year ended December 31, 2013 increased $6,048 million as compared to the same period in 2012, approximately $2.2 billion of which was attributable to an increase in our net worldwide factory shipments. In addition, approximately $1.4 billion was attributable to a higher percentage of growth in truck and certain SUV shipments as compared to minivan and passenger car shipments. Further,

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approximately $1.2 billion of the increase was due to higher base material costs associated with vehicle components and enhancements. In addition, we incurred approximately $200 million of higher depreciation and amortization expense primarily related to capital investments associated with our recent product launches. There was also an increase of $200 million in other costs associated with expanding our manufacturing capacity, which includes costs for additional shifts and/or crews at certain facilities in order to meet increased production requirements to support consumer demand. In addition, approximately $500 million of the increase was attributable to a shift in market mix to greater retail shipments as a percentage of total shipments, as our retail customers tend to purchase vehicles with more optional features. See—Revenues, Net, above, for additional discussion.

Cost of sales for the year ended December 31, 2013 also included a $151 million charge recognized during the second quarter of 2013 related to our voluntary safety recall for the 1993-1998 Jeep Grand Cherokee and 2002-2007 Jeep Liberty, as well as our customer satisfaction action for the 1999-2004 Jeep Grand Cherokee. In addition, during the year ended December 31, 2012, we recognized insurance recoveries totaling $76 million related to losses sustained in 2011 due to supply disruptions. The proceeds from these recoveries were fully collected during 2012. There were no similar insurance recoveries during the year ended December 31, 2013.

Gross margin for the year ended December 31, 2013 increased $312 million, or three percent, as compared to the same period in 2012. Overall, the increase in gross margin is attributable to favorable net pricing of approximately $1.2 billion. In addition, there was an increase in our net worldwide factory shipments which contributed approximately $600 million to our increased gross margin. Further, the favorable shift in market mix contributed to an increase in our gross margin of approximately $400 million. These increases were partially offset by approximately $1.2 billion of higher base material costs associated with vehicle components and enhancements. In addition, we incurred approximately $200 million of higher depreciation and amortization expense primarily related to capital investments associated with our recent product launches. There was also an increase of $200 million in other costs associated with expanding our manufacturing capacity, which includes costs for additional shifts and/or crews at certain facilities in order to meet increased production requirements to support consumer demand. The reduction in gross margin also included the $151 million charge recognized during 2013 for the above-mentioned voluntary safety recall and customer satisfaction action. In addition, gross margin was lower in 2013 due to the $76 million of insurance recoveries recognized in 2012 as discussed above.

2012 Compared to 2011. Cost of sales for the year ended December 31, 2012 increased $8,928 million as compared to the same period in 2011, primarily due to higher production volumes and an increase in vehicle shipments, which accounted for approximately $8.8 billion of the increase. Additionally, cost of sales increased due to higher costs associated with the shift in market mix to greater retail shipments as a percentage of total shipments also noted above. These increases in cost of sales were partially offset by $1.2 billion of lower costs associated with the higher percentage growth of passenger car shipments as compared to truck and SUV shipments, as well as our increased sales of vehicles with the value option packages noted above in —Revenues, Net.

Material costs for the year ended December 31, 2012 increased by approximately $300 million as compared to the year ended December 31, 2011, consistent with our continuing investments in vehicle components and enhancements. These enhancements include improved engine and transmission technologies, primarily the 3.6L Pentastar V-6 engine and 8-speed automatic transmission, as well as upgraded media components such as the Uconnect Touch, featuring an 8.4 inch screen. In addition we continue to upgrade the interiors of our vehicles with features such as premium leather and LED accent lighting.

Further, price increases for certain raw materials had a negative impact on our cost of sales of approximately $400 million for the year ended December 31, 2012 as compared to the year ended December 31, 2011. However, we were able to partially offset these price increases by achieving certain cost savings, principally from commercial re-negotiations and technical efficiencies, such as modifying the material content of a part, as well as efficiencies achieved through our ongoing implementation of WCM processes.

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Additionally, during the year ended December 31, 2012, we recognized insurance recoveries totaling $76 million related to losses sustained in 2011 due to supply disruptions. The proceeds from these recoveries were fully collected as of September 30, 2012. There were no similar insurance recoveries during 2011.

Gross margin for the year ended December 31, 2012 increased $1,875 million, or 22 percent, as compared to the same period in 2011. Overall, the increase in gross margin is attributable to an increase in our net worldwide factory shipments of approximately $2.4 billion, as well as favorable net pricing of approximately $900 million. In addition, the gross margin increase was attributable to $76 million of insurance recoveries recognized during the year ended December 31, 2012, for which there were no similar insurance recoveries during the year ended December 31, 2011. These increases were partially offset by an unfavorable shift in vehicle mix of approximately $800 million, primarily due to a shift towards passenger cars from trucks and SUVs, as discussed above, as well as higher material costs of approximately $700 million associated with vehicle components and enhancements, and higher raw material costs.

Selling, Administrative and Other Expenses

	Years Ended December 31,												Increase (Decrease)
	2013		Percentage of Revenues		2012		Percentage of Revenues		2011		Percentage of Revenues		2013 vs. 2012			2012 vs. 2011
	(in millions of dollars)
Selling, administrative and other expenses	$	5,218		7.2%	$	5,179		7.9%	$	4,751		8.6%	$	39	0.8%	$	428	9.0%

Selling, administrative and other expenses include advertising, personnel, warehousing and other costs. Advertising expenses accounted for approximately 53 percent, 53 percent and 54 percent of these costs for the years ended December 31, 2013, 2012 and 2011, respectively.

2013 Compared to 2012.For the year ended December 31, 2013, selling, administrative and other expenses remained relatively consistent as compared to the same period in 2012. Advertising expense consists primarily of national and regional media campaigns, as well as marketing support in the form of trade and auto shows, events and sponsorships. Typically, we incur greater advertising costs in the initial months that new or significantly refreshed vehicles become available at dealerships. In 2013, we launched the significantly refreshed 2014 Jeep Grand Cherokee, the all-new 2014 Jeep Cherokee and the all-new Fiat 500L. In 2012, we launched the all-new Dodge Dart and the Ram 1500. In addition, during 2012, we continued to increase our advertising spending for the Fiat 500 to build upon the growing success of the vehicle and to support the launch of the Fiat 500 Abarth.

2012 Compared to 2011. Our advertising costs through the first half of 2012 were relatively consistent with costs incurred during 2011, as we continued to place great emphasis on our brand- and vehicle-focused campaigns in order to increase consumer awareness of our current portfolio. We typically incur greater advertising costs in the initial months that new or significantly refreshed vehicles are available to customers in dealerships. During the second half of 2012, we began incurring greater advertising costs associated with our national and regional advertising campaigns to support the retail launches of the all-new Dodge Dart and the 2013 Ram 1500. In addition, during 2012, we continued to increase our advertising spending for the Fiat 500 to build upon the growing success of the vehicle and to support the launch of the Fiat 500 Abarth. Personnel expenses also increased during the year ended December 31, 2012 as compared to the same period in 2011, primarily due to the increase in headcount in 2012 to support our sales, marketing and other corporate initiatives.

Research and Development Expenses, Net

	Years Ended December 31,												Increase (Decrease)
	2013		Percentage of Revenues		2012		Percentage of Revenues		2011		Percentage of Revenues		2013 vs. 2012			2012 vs. 2011
	(in millions of dollars)
Research and development expenses, net	$	2,320		3.2%	$	2,324		3.5%	$	1,674		3.0%	$	(4)	(0.17)%	$	650	38.8%

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We conduct research and development for new vehicles and technology to improve the performance, safety, fuel efficiency, reliability and consumer perception of our vehicles. Research and development expenses consist primarily of material costs and personnel related expenses that support development of new and existing vehicles and powertrain technologies, including the building of three-dimensional models, virtual simulations, prototype building and testing (including with respect to the integration of safety and powertrain technologies) and assembly of pre-production pilot models. Additionally, research and development activities focus on improved fuel efficiency and reduced emissions. Under the Fiat-Chrysler Alliance, we share access to certain platforms, vehicles, products and technology with Fiat. Likewise, costs are shared with Fiat related to joint engineering and development activities and we reimburse each other based upon costs agreed to under the respective cost sharing arrangements. Our research and development expenses for the years ended December 31, 2013, 2012 and 2011, are net of $33 million, $51 million and $78 million, respectively, of reimbursements.

2013 Compared to 2012.Research and development expenses remained relatively consistent year over year. For the year ended December 31, 2013, spending related primarily to direct and indirect materials, and personnel expenses focused on mid-cycle and new program actions, principally the Ram truck lineup, along with the all-new 2014 Jeep Cherokee and the all-new 2015 Chrysler 200. In 2013, spending also continued for our joint development programs with Fiat primarily related to future B-segment vehicles. For the year ended December 31, 2012, spending related primarily to mid-cycle actions, principally the Ram truck lineup, Jeep Grand Cherokee, Dodge Durango and the all-new 2014 Jeep Cherokee, as well as joint development programs with Fiat primarily related to the CUSW platform utilized for the Dodge Dart, which launched in second quarter 2012.

2012 Compared to 2011. The increase in net research and development expenses for the year ended December 31, 2012 as compared to the same period in 2011, was primarily due to increased spending for direct and indirect materials related to mid-cycle actions, principally the Ram truck lineup, Jeep Grand Cherokee and Dodge Durango, as well as joint development programs with Fiat, including the CUSW platform utilized for the all-new Dodge Dart and designed for certain future C- and D- segment vehicles. In addition, we continue to invest in vehicle and technology enhancements for Fiat vehicles that we will produce and distribute within North America. To support all of these efforts, we have increased our average headcount for research and development employees by approximately 17 percent from the year ended December 31, 2011 to the year ended December 31, 2012 to fulfill specialized needs. The average number of temporary contract workers remained consistent between 2011 and 2012.

Restructuring (Income) Expenses, Net

	Years Ended December 31,						Increase (Decrease)
	2013		2012		2011		2013 vs. 2012			2012 vs. 2011
	(in millions of dollars)
Restructuring (income) expenses, net	$	(14)	$	(61)	$	3	$	47	77.0%	$	(64)	(2,133.3)%

In connection with the 363 Transaction, we assumed certain liabilities related to specific restructuring actions commenced by Old Carco. These liabilities represented costs for workforce reduction actions related to our represented and non-represented hourly and salaried workforce, as well as specific contractual liabilities assumed for other costs, including supplier cancellation claims. In accordance with the accounting guidance for exit or disposal activities, certain costs associated with these previously announced plans, such as relocation, contract termination and plant deactivations, are recognized as restructuring expense when the costs are incurred. We continue to monitor these previously established reserves for adequacy, taking into consideration the status of the restructuring actions and the estimated costs to complete the actions, and any necessary adjustments are recorded in the period the adjustment is determinable.

2013.Restructuring income, net for the year ended December 31, 2013 was $14 million and includes refinements to existing reserve estimates primarily related to decreases in the expected workforce reduction costs and legal claim reserves.

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2012. Restructuring income, net for the year ended December 31, 2012 was $61 million and includes refinements to existing reserve estimates of $62 million primarily related to decreases in the expected workforce reduction costs and legal claim reserves, as well as other transition costs related to the integration of the operations of our European distribution and dealer network into Fiat’s distribution organization. These refinements were partially offset by $1 million of charges primarily related to costs associated with employee relocations for previously announced restructuring initiatives.

2011. Restructuring expenses, net for the year ended December 31, 2011 was $3 million and included charges of $51 million primarily related to costs associated with employee relocations and plant deactivations for previously announced restructuring initiatives, as well as other transition costs resulting from the integration of the operations of our European distribution and dealer network into Fiat’s distribution organization. These charges were substantially offset by refinements to existing reserve estimates of $48 million primarily related to decreases in the expected workforce reduction costs, as well as legal and supplier cancellation claim reserves.

Interest expense

	Years Ended December 31,						Increase (Decrease)
	2013		2012		2011		2013 vs. 2012			2012 vs. 2011
	(in millions of dollars)
Interest expense	$	1,035	$	1,094	$	1,238	$	(59)	(5.4)%	$	(144)	(11.6)%

Interest expense included the following (in millions of dollars):

	Years Ended December 31,						Increase (Decrease)
	2013		2012		2011		2013 vs. 2012			2012 vs. 2011
Financial interest expense:
VEBA Trust Note	$	433	$	440	$	432	$	(7)	(1.6)%	$	8		1.9	%
2019 and 2021 Notes		260		260		157		—	—%		103		65.6	%
Tranche B Term Loan		151		181		111		(30)	(16.6)%		70		63.1	%
Canadian Health Care Trust Notes		89		99		92		(10)	(10.1)%		7		7.6	%
Mexican development banks credit facilities		54		58		41		(4)	(6.9)%		17		41.5	%
U.S. Treasury first lien credit facilities		—		—		202		—	—%		(202	)	(100.0	)%
EDC credit facilities		—		—		44		—	—%		(44	)	(100.0	)%
Financial resources provided by Fiat		8		—		—		8	100.0%		—		—	%
Other		49		53		62		(4)	(7.5)%		(9	)	(14.5	)%
Interest accretion, primarily related to debt discounts, debt issuance costs and fair market value adjustments		117		119		170		(2)	(1.7)%		(51	)	(30.0	)%
Payable-in-kind interest		—		—		27		—	—%		(27	)	(100.0	)%
Capitalized interest related to capital expenditures		(126)		(116)		(100)		(10)	(8.6)%		(16	)	(16.0	)%
Total	$	1,035	$	1,094	$	1,238	$	(59)	(5.4)%	$	(144	)	(11.6	)%

2013 Compared to 2012. The decrease in interest expense for the year ended December 31, 2013 as compared to the year ended December 31, 2012 was primarily due to lower effective interest rates resulting from the June 21, 2013 amendment and restatement of our Original Senior Credit Agreement, which reduced the applicable interest rate spreads on the Senior Credit Facilities by 1.50 percent per annum and reduced the rate floors applicable to

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the Tranche B Term Loan by 0.25 percent per annum. Refer to—Liquidity and Capital Resources —SeniorCredit Facilities and Secured Senior Notes and —Senior Credit Facilities, for additional information related to these transactions.

2012 Compared to 2011.The decrease in interest expense for the year ended December 31, 2012 as compared to the year ended December 31, 2011 was primarily due to the interest savings and reduced interest accretion achieved as a result of our debt refinancing transaction in May 2011. In that transaction, we repaid our outstanding obligations under the U.S. Treasury and EDC credit facilities and entered into the Tranche B Term Loan and issued the 2019 Notes and 2021 Notes. Refer to—Liquidity and Capital Resources —Repayment of U.S. Treasury and EDC Credit Facilitiesbelow, for additional information regarding our May 2011 refinancing transaction. The interest savings and reduced interest accretion are primarily due to the Tranche B Term Loan and 2019 Notes and 2021 Notes having lower effective interest rates and debt discounts than the U.S. Treasury and EDC credit facilities. Refer to—Loss on Extinguishment of Debt below, for additional information regarding the write off of the U.S. Treasury and EDC credit facilities unamortized discounts and debt issuance costs.

Loss on Extinguishment of Debt

	Years Ended December 31,						Increase (Decrease)
	2013		2012		�� 2011		2013 vs. 2012			2012 vs. 2011
	(in millions of dollars)
Loss on extinguishment of debt	$	24	$	—	$	551	$	24	100.0%	$	(551	)	(100.0	)%

2013 Compared to 2012.In connection with the June 21, 2013 amendment and restatement of our Original Senior Credit Agreement and December 23, 2013 re-pricing of the Tranche B Term Loan, we recognized a $24 million loss on extinguishment of debt. The loss consisted of the write off of $13 million of unamortized debt discounts and $3 million of unamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of call premium and other fees associated with the amendments. Refer to—Liquidity and Capital Resources —Senior Credit Facilities and Secured Senior Notes and—Senior Credit Facilities, below, for additional information related to our amendments to the Senior Credit Facilities.

2012 Compared to 2011.In connection with the May 24, 2011 repayment of our outstanding obligations under the U.S. Treasury and EDC credit facilities, we recognized a $551 million loss on extinguishment of debt. The loss consisted of the write off of $136 million of unamortized discounts and $34 million of unamortized debt issuance costs associated with the U.S. Treasury credit facilities and $367 million of unamortized discounts and $14 million of unamortized debt issuance costs associated with the EDC credit facilities. Refer to —Liquidity and Capital Resources —Repayment of U.S. Treasury and EDC Credit Facilitiesbelow, for additional information regarding our May 2011 refinancing transaction.

Income Tax (Benefit) Expense

	Years Ended December 31,							Increase (Decrease)
	2013			2012		2011		2013 vs. 2012					2012 vs. 2011
	(in millions of dollars)
Income tax (benefit) expense	$	(553	)	$	274	$	198	$	(827	)	(301.8	)%	$	76	38.4	%

Our effective income tax rate differs from the expected federal statutory rate of 35 percent primarily because we are a limited liability company, or LLC, taxed as a partnership and substantially all of our 100 percent owned U.S. subsidiaries are LLCs that are disregarded entities for U.S. federal tax purposes and differences between foreign statutory tax rates and the U.S. federal statutory tax rate. The primary difference in 2013 is due to the release of a $962 million valuation allowance on net deferred tax assets resulting in a tax benefit for the 2013 year.

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2013.Our effective income tax rate for the year ended December 31, 2013 was (25) percent. While we had pretax income, we recognized a non-cash tax benefit of $962 million related to the release of valuation allowances on certain of our deferred tax assets. Refer to—Critical Accounting Estimates —Valuation of Deferred Tax Assets for additional information.

2012. Our effective income tax rate for the year ended December 31, 2012 was 14 percent, primarily due to income generated by us and certain of our 100 percent owned U.S. subsidiaries that are not subject to income tax at the Chrysler Group level. Income tax expense for the year ended December 31, 2012 was primarily driven by foreign statutory tax provisions as a result of our subsidiaries in foreign jurisdictions having taxable earnings.

2011. Our effective income tax rate for the year ended December 31, 2011 was 52 percent, primarily due to losses generated by us and certain of our 100 percent owned U.S. subsidiaries. Income tax expense for the year ended December 31, 2011 was primarily driven by foreign statutory tax provisions as a result of our subsidiaries in foreign jurisdictions having taxable earnings and adjustments made to prior year returns. Income tax expense also includes provisions for U.S. state and local taxes.

Non-Cash (Gains) Charges

The following summarizes our significant non-cash (gains) charges (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Loss on extinguishment of debt	$	24	$	—	$	551
Valuation allowances against deferred tax assets		(962)		(77)		6
Total Significant Non-Cash (Gains) Charges	$	(938)	$	(77)	$	557

Liquidity and Capital Resources

Liquidity Overview

We require significant liquidity in order to meet our obligations and fund our business plan. Short-term liquidity is required to purchase raw materials, parts and components required for vehicle production, and to fund selling, administrative, research and development, and other expenses. In addition to our general working capital needs, we expect to use significant amounts of cash for the following purposes: (i) capital expenditures to support our existing and future products; (ii) principal and interest payments under our financial obligations and (iii) pension and OPEB payments. Our capital expenditures are estimated to be approximately $4 billion in 2014, which we plan to fund with cash generated primarily from our operating activities.

Liquidity needs are met primarily through cash generated from operations, including the sale of vehicles and service parts to dealers, distributors and other consumers worldwide. We also have access to the Revolving Facility, which is undrawn, as detailed under the caption —Total Available Liquidity below. In addition, long-term liquidity needs may involve some level of debt refinancing as outstanding debt becomes due or we are required to make amortization or other principal payments. Although we believe that our current level of total available liquidity is sufficient to meet our short-term and long-term liquidity requirements, we regularly evaluate opportunities to improve our liquidity position and increase our net industrial cash over time in order to enhance our financial flexibility and to achieve and maintain a liquidity and capital position consistent with that of our principal competitors.

Any actual or perceived limitations of our liquidity, or the liquidity of Fiat, may limit the ability or willingness of counterparties, including dealers, consumers, suppliers, lenders and financial service providers, to do business with us, or require us to restrict additional amounts of cash to provide collateral security for our obligations. Our liquidity levels are subject to a number of risks and uncertainties, including those described in Risk Factors.

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Total Available Liquidity

At December 31, 2013, our total available liquidity was $14.6 billion, including $1.3 billion available to be borrowed under our Revolving Facility. We may access these funds subject to the conditions of our Senior Credit Agreement. Refer to —Senior Credit Facilities and Secured Senior Notes and—Senior Credit Facilities, below, for additional information regarding our Senior Credit Agreement. The proceeds from the Revolving Facility may be used for general corporate and/or working capital purposes. The terms of our Senior Credit Facilities require us to maintain a minimum liquidity of $3.0 billion inclusive of any amounts undrawn on our Revolving Facility. Total available liquidity includes cash and cash equivalents, which are subject to intra-month, foreign exchange and seasonal fluctuations. Restricted cash is not included in our presentation of total available liquidity.

The following summarizes our total available liquidity (in millions of dollars):

	Years ended December 31,
	2013		2012
Cash and cash equivalents (1)	$	13,344	$	11,614
Revolving Facility availability (2)		1,300		1,300
Total Available Liquidity	$	14,644	$	12,914

(1) The foreign subsidiaries for which we have elected to permanently reinvest earnings outside of the U.S. held $1.0 billion and $1.1 billion of cash and cash equivalents as of December 31, 2013 and 2012, respectively. Our current plans do not demonstrate a need to, nor do we have plans to, repatriate the retained earnings from these subsidiaries, as the earnings are permanently reinvested. However, if we determine, in the future, that it is necessary to repatriate these funds or we sell or liquidate any of these subsidiaries, we may be required either to pay taxes, or make distributions to our members to pay taxes associated with the repatriation or the sale or liquidation of these subsidiaries. We may also be required to accrue and pay withholding taxes, depending on the foreign jurisdiction from which the funds are repatriated.

(2) As of December 31, 2013, we had the option to increase the amount of these facilities in an aggregate principal amount not to exceed $1.2 billion, either through an additional term loan, an increase in the Revolving Facility or a combination of both. Refer to —New Debt Issuances and Repayment of the VEBA Trust Note, below, for information regarding the Refinancing Transactions.

The increase in total available liquidity from December 31, 2012 to December 31, 2013, reflects a $1,730 million increase in cash and cash equivalents. Refer to —Cash Flows,below, for additional information regarding our changes in cash and cash equivalents.

Restricted Cash

Restricted cash, which includes cash equivalents, was $333 million at December 31, 2013. Restricted cash included $247 million held on deposit or otherwise pledged to secure our obligations under various commercial agreements guaranteed by a subsidiary of Daimler AG, or Daimler, and $86 million of collateral for other contractual agreements.

Working Capital Cycle

Our business and results of operations depend upon our ability to achieve certain minimum vehicle sales volumes. As is typical for an automotive manufacturer, we have significant fixed costs, and therefore, changes in our vehicle sales volume can have a significant effect on profitability and liquidity. We generally receive payment on sales of vehicles in North America within a few days of shipment from our assembly plants, whereas there is a lag between the time we receive parts and materials from our suppliers and the time we are required to pay for them. Therefore, during periods of increasing vehicle sales, there is generally a corresponding positive impact on our cash flow and liquidity. Conversely, during periods in which vehicle sales decline, there is generally a corresponding negative impact on our cash flow and liquidity. Similarly, delays in shipments of vehicles, including delays in shipments in

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order to address quality issues, may negatively affect our cash flow and liquidity. In addition, the timing of our collections of receivables for sales of vehicles outside of North America tends to be longer due to extended payment terms, and may cause fluctuations in our working capital. The timing of our vehicle sales under our guaranteed depreciation program can cause seasonal fluctuations in our working capital. Typically, the number of vehicles sold under the program peak during the second quarter and then taper off during the third quarter.

Cash Flows

Year Ended December 31, 2013 compared to Years Ended December 31, 2012 and 2011

Operating Activities —Year Ended December 31, 2013

For the year ended December 31, 2013, our net cash provided by operating activities was $5,536 million and was primarily the result of:

(i) net income of $2,757 million, adjusted to add back $3,042 million for depreciation and amortization expense (including amortization and accretion of debt discounts, debt issuance costs, fair market value adjustments and favorable and unfavorable lease contracts), $281 million of non-cash pension and OPEB expense and the $24 million loss on extinguishment of debt associated with the amendments and re-pricing of the Senior Credit Facilities, partially offset by $8 million of the call premium and other fees paid in connection with the transaction;

(ii) a $78 million foreign currency translation loss recognized as a result of the February 2013 currency devaluation in Venezuela, partially offset by $22 million of foreign currency transaction gains due to certain monetary liabilities, which had been submitted to CADIVI for payment approval through the ordinary course of business prior to the devaluation date, being approved to be paid at an exchange rate of 4.30 VEF per USD subsequent to the devaluation. Refer toQuantitative and Qualitative Disclosures about Market Riskbelow, for additional information regarding Venezuela currency regulations and devaluation;

(iii) a $997 million increase in trade liabilities, primarily due to increased production in response to increased consumer demand of our vehicles, which was consistent with the increase in our worldwide factory shipments;

(iv) a $605 million increase in accrued sales incentives, primarily due to an increase in our dealer stock levels at December 31, 2013 versus December 31, 2012 to support increased sales volumes;

(v) a $286 million increase in accrued product warranty costs, primarily related to the $151 million provision recognized during the second quarter of 2013 in connection with our voluntary safety recall for the 1993-1998 Jeep Grand Cherokee and 2002-2007 Jeep Liberty, as well as our customer satisfaction action for the 1999-2004 Jeep Grand Cherokee; and

(vi) a $156 million increase in payables due to Fiat as a result of increased purchases of vehicles, components, parts, tooling and equipment during 2013 as compared to 2012 as we continue to implement our distribution strategy with Fiat.

These increases in our net cash provided by operating activities were partially offset by:

(i) a $962 million non-cash release of the valuation allowance on deferred tax assets;

(ii) an $893 million increase in inventory, primarily due to increased finished vehicle and work in process levels at December 31, 2013 versus December 31, 2012. These increases were partially

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driven by higher production levels in late 2013 to meet anticipated consumer demand. Our international finished vehicle inventory levels have also increased since December 2012 in order to support consumer demand;

(iii) $756 million of pension and OPEB contributions;

(iv) a $228 million increase in receivables due from Fiat as a result of an increase in vehicle shipments, parts sales and services provided to Fiat during 2013 as compared to 2012;

(v) the payment of $159 million of capitalized interest on the VEBA Trust Note; and

(vi) the payment of $47 million and $22 million of capitalized interest on the Canadian Health Care Trust, or HCT, Tranche A and B notes, respectively. Refer to —Canadian Health Care Trust Notes, below, for additional information related to these repayments.

Operating Activities —Year Ended December 31, 2012

For the year ended December 31, 2012, our net cash provided by operating activities was $5,821 million and was primarily the result of:

(i) net income of $1,668 million, adjusted to add back $2,787 million for depreciation and amortization expense (including amortization and accretion of debt discounts, debt issuance costs, fair market value adjustments and favorable and unfavorable lease contracts);

(ii) a $1,325 million increase in trade liabilities, primarily due to increased production in response to increased consumer demand of our vehicles, which was consistent with the increase in our worldwide factory shipments;

(iii) a $600 million increase in accrued sales incentives, primarily due to an increase in our U.S. dealer inventory levels at December 31, 2012 versus December 31, 2011 to support increased sales volumes across all nameplates and deliveries of our newly launched Dodge Dart and the 2013 Ram 1500 at the end of 2012;

(iv) a $478 million decrease in receivables due from Fiat as a result of greater sales to Fiat during the fourth quarter of 2011 versus the fourth quarter of 2012, primarily due to reduced consumer demand as a result of the continuing economic weakness in several European countries; and

(v) a $184 million increase in payables due to Fiat as a result of increased purchases of vehicles, parts and services during late 2012 as compared to late 2011, as a result of us becoming the primary distributor for Fiat vehicles in certain countries.

These increases in our net cash provided by operating activities were partially offset by:

(i) a $630 million increase in inventory, primarily due to increased finished vehicle levels at December 31, 2012 versus December 31, 2011. These increases were primarily driven by an increase in our international vehicle inventory levels in order to support consumer demand for both our and Fiat’s vehicles. In 2012, we began distributing Fiat vehicles through more of our international distribution centers;

(ii) a $513 million combined decrease in the residual value guarantees accruals and deferred revenue related to our GDP vehicles, primarily driven by the decrease in the number of U.S. GDP vehicles in-service at December 31, 2012 versus December 31, 2011, as rental car

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companies moved towards purchasing non-GDP vehicles due to the improved residual values of our vehicles. This decrease is mostly offset by a decrease in the related vehicles classified as equipment on operating leases;

(iii) $443 million of pension and OPEB contributions; and

(iv) a $334 million increase in accounts receivable primarily due to an increase in receivables from third party international dealers and distributors due to increased sales at the end of 2012 as compared to 2011 due to consumer demand. Our payment terms on vehicle sales outside of North America are longer than vehicle sales in North America, which are typically collected within a few days of shipment from our assembly plants.

Operating Activities —Year Ended December 31, 2011

For the year ended December 31, 2011, our net cash provided by operating activities was $4,603 million and was primarily the result of:

(i) net income of $183 million, adjusted to add back the $551 million loss on extinguishment of debt associated with the repayment of our U.S. Treasury and EDC credit facilities and $3,062 million of depreciation and amortization expense (including amortization and accretion of debt discounts, debt issuance costs, fair market value adjustments and favorable and unfavorable lease contracts);

(ii) a $1,711 million increase in trade liabilities, primarily due to increased production in response to increased consumer demand for our vehicles following the introduction of our 16 all-new or significantly refreshed vehicles, which was consistent with the increase in our worldwide factory shipments;

(iii) $374 million in collections from Daimler related to the Daimler tax receivable. Refer to —Daimler Tax Receivable, below, for additional information related to these collections;

(iv) a $274 million increase in payables due to Fiat as a result of increased purchases of parts and services during late 2011 as compared to late 2010; and

(v) a $301 million increase in accrued sales incentives, primarily to an increase in our U.S. dealer inventory levels as December 31, 2011 versus December 31, 2010, mostly due to an increase in our shipments during late 2011 versus the end of 2010 in order to meet consumer demand for our 16 all-new or significantly refreshed vehicles.

These increases in our net cash provided by operating activities were partially offset by:

(i) a $751 million increase in receivables due from Fiat as a result of increased sales of vehicles, service parts and services to Fiat during 2011 as compared to the end of 2010, primarily due to the integration of our European distribution and dealer network organization into Fiat’s distribution organization;

(ii) a $721 million increase in inventory, primarily due to increased finished vehicle and work in process levels at December 31, 2011 versus December 31, 2010. These increases were primarily driven by the overall increase in production levels and international vehicle shipments due to greater consumer demand for our vehicles and the vehicles we manufacture for Fiat;

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(iii) $579 million of pension and OPEB contributions, partially offset by the collection of a $200 million pension receivable from Daimler; and

(iv) the repayment of $395 million of capitalized payable-in-kind, or PIK, interest on our U.S. Treasury credit facilities.

Investing Activities —Year Ended December 31, 2013

For the year ended December 31, 2013, our net cash used in investing activities was $3,413 million and was primarily the result of:

(i) $3,434 million of capital expenditures to support our investments in existing and future products.

These cash outflows were partially offset by:

(i) a $38 million decrease in restricted cash, which was primarily the result of no collateral required to be posted for our foreign currency and commodity derivative contracts as of December 31, 2013, as the contracts were either in a net positive fair value position at December 31, 2013, or within the posting thresholds within our master agreements with counterparties.

Investing Activities —Year Ended December 31, 2012

For the year ended December 31, 2012, our net cash used in investing activities was $3,557 million and was primarily the result of:

(i) $3,633 million of capital expenditures to support our investments in existing and future products.

These cash outflows were partially offset by:

(i) $87 million of proceeds from disposals of equipment and other assets on operating leases, primarily related to our Gold Key Lease vehicle lease portfolio; and

(ii) a $90 million decrease in restricted cash, primarily due to reduced collateral requirements as a result of positive mark-to-market adjustments for outstanding derivative instruments during the period.

Investing Activities —Year Ended December 31, 2011

For the year ended December 31, 2011, our net cash used in investing activities was $1,970 million and was primarily the result of:

(i) $3,009 million of capital expenditures to support our investments in existing and future products.

These cash outflows were partially offset by:

(i) $704 million of proceeds from disposals of equipment and other assets on operating leases, primarily related to our Gold Key Lease vehicle lease portfolio;

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(ii) a $215 million decrease in restricted cash. The decrease in restricted cash was primarily the result of the release of $167 million of collateral associated with the Gold Key Lease vehicle lease portfolio, which was used to pay down an equivalent amount outstanding on our Gold Key Lease credit facility. The decrease was also due to the release of initial margin collateral requirements for foreign currency exchange and commodity hedge contracts, in addition to positive mark-to-market adjustments; and

(iii) $96 million of proceeds from U.S. Dealer Automotive Receivables Transition LLC, or USDART, which represented the remaining balance of a previous advance to USDART that was transferred to us in May 2011, in connection with the termination of the Ally Master Transaction Agreement, or Ally MTA, between the U.S. Treasury, Ally and USDART. Refer to—Ally MTA below, for additional information related to the USDART and the Ally MTA.

Financing Activities —Year Ended December 31, 2013

For the year ended December 31, 2013, our net cash used in financing activities was $302 million and was primarily the result of:

(i) $248 million of debt repayments including $55 million related to the Auburn Hills Headquarters loan, $45 million related to the HCT Tranche A note, $31 million related to the Mexican development banks credit facility, $30 million related to the Tranche B Term Loan, and $87 million related to other financial obligations and capital leases; and

(ii) $30 million of debt issuance costs related to the June 2013 amendment and re-pricing of the Senior Credit Facilities and the December 2013 re-pricing of the Tranche B Term Loan. In connection with these transactions, we repaid $790 million of the outstanding principal balance of the Tranche B Term Loan to lenders who either partially or fully reduced their holdings. The outstanding principal balance on the Tranche B Term Loan did not change, as new and continuing lenders acquired the $790 million. Refer to —Senior Credit Facilities and Secured Senior Notes and—Senior Credit Facilities, below, for additional information regarding this transaction.

Financing Activities —Year Ended December 31, 2012

For the year ended December 31, 2012, our net cash used in financing activities was $251 million and was primarily the result of:

(i) $204 million of debt repayments, including $50 million related to the Auburn Hills Headquarters loan, $30 million related to the Tranche B Term Loan, $25 million related to the Canadian Health Care Trust Note – Tranche D, or HCT Tranche D note, $15 million related to the Mexican development banks credit facility and $84 million related to capital leases and other financial obligations; and

(ii) $41 million of repayments of our Gold Key Lease financing obligations, which included the final repayment of the outstanding asset-backed note payable in June 2012. Gold Key Lease program proceeds used to fund these payments are included in operating and investing activities.

Financing Activities —Year Ended December 31, 2011

For the year ended December 31, 2011, our net cash used in financing activities was $405 million and was primarily the result of:

(i) $584 million of repayments of our Gold Key Lease financing obligations, which included the full repayment of the amounts outstanding on our Gold Key Lease credit facility in April 2011; and

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(ii) $135 million of debt repayments, including $26 million related to the HCT Tranche D note, $15 million related to the Tranche B Term Loan, $13 million related to the Auburn Hills Headquarters loan and $81 million related to capital leases and other financial obligations.

These cash outflows were partially offset by:

(i) $217 million of loan proceeds received in December 2011 as a result of a financing arrangement with certain Mexican development banks; and

(ii) net proceeds received from our refinancing transaction in May 2011, which consisted of:

(a) $3,160 million of net proceeds from the Secured Senior Notes excluding the old notes;

(b) $2,933 million of net proceeds from the Tranche B Term Loan;

(c) $1,268 million of proceeds received from Fiat’s exercise of its incremental equity call option;

(d) $5,460 million of principal repayments (excluding capitalized PIK) of our U.S. Treasury credit facilities;

(e) $1,723 million of principal repayments of our EDC credit facilities; and

(f) $72 million of related debt issuance costs.

Net Industrial Cash (Debt)

Our calculation of Net Industrial Cash (Debt), as well as a detailed discussion of these measures, is included above in —Non-GAAP Financial Measures —Net Industrial Cash (Debt).

Our Net Industrial Cash (Debt) increased by $2,032 million from a $(989) million Net Industrial Debt position at December 31, 2012 to a Net Industrial Cash position of $1,043 million at December 31, 2013, primarily due to a $1,730 million increase in cash and cash equivalents. Refer to—Cash Flows, above, for additional information regarding the increase in our cash and cash equivalents for the year ended December 31, 2013. During 2013, our financial liabilities decreased by $302 million, primarily due to debt and other financial obligations repayments, including $159 million of capitalized interest payments related to our VEBA Trust Note and $114 million of principal and capitalized interest payments related to our Canadian HCT Notes, partially offset by the capitalization of accrued interest as additional debt during 2013. Refer to —VEBA Trust Note and —Canadian Health Care Trust Notes, below, for additional information related to these payments.

Free Cash Flow

Our calculation of Free Cash Flow, as well as a detailed discussion of this measure, is included above in —Non-GAAP Financial Measures —Free Cash Flow.

Free Cash Flow for the years ended December 31, 2013, 2012 and 2011 totaled $2,123 million, $2,221 million and $1,947 million, respectively.

The decrease in Free Cash Flow from 2012 to 2013 was primarily due to:

(i) a $285 million decrease in our cash generated from operations. Refer to —Cash Flows above, for additional information regarding the change in cash generated from operations;

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(ii) a $81 million decrease in proceeds from disposals of equipment and other assets on operating leases, primarily related to the wind down of our Gold Key Lease portfolio; and

(iii) a $52 million reduction in our change in restricted cash. The $38 million reduction in restricted cash during 2013 as well as the $90 million reduction in restricted cash during 2012 were primarily driven by reduced collateral requirements for foreign currency exchange and commodity hedge contracts as a result of positive mark-to-market adjustments as well as other contractual agreements.

These unfavorable cash flows were partially offset by:

(i) a $199 million decrease in our capital expenditures, primarily due to the timing of payments in 2013 and increased spending in 2012 associated with investments to enhance our current and future product portfolio; and

(ii) a $95 million decrease in purchases of equipment and other assets on operating leases.

The increase in Free Cash Flow from 2011 to 2012 was primarily due to:

(i) a $1,218 million increase in our cash generated from operations. Refer to —Cash Flows above, for additional information regarding the change in cash generated from operations; and

(ii) a $543 million reduction in repayments on our Gold Key Lease financing obligations, primarily due to the significant reduction in the related outstanding obligations, which is consistent with the wind down of the program. As of June 2012, all Gold Key Lease financing obligations have been repaid.

These favorable cash flows were partially offset by:

(i) a $624 million increase in our capital expenditures due to our continued investments to enhance our current and future product portfolio;

(ii) a $617 million reduction in proceeds from disposals of equipment and other assets on operating leases, primarily related to the wind down of our Gold Key Lease vehicle lease portfolio; and

(iii) a $125 million reduction in our change in restricted cash. The $90 million reduction in restricted cash during 2012 was primarily driven by reduced collateral requirements for foreign currency exchange and commodity hedge contracts as a result of positive mark-to-market adjustments during 2012. The $215 million reduction in restricted cash during 2011 was primarily due to the release of $167 million of collateral associated with the Gold Key Lease vehicle lease portfolio and the release of initial margin collateral requirements for foreign currency exchange and commodity hedge contracts.

New Debt Issuances and Repayment of the VEBA Trust Note

On February 7, 2014, we and certain of our U.S. subsidiaries as guarantors entered into the following transactions to facilitate the repayment of the VEBA Trust Note:

• New Senior Credit Facilities —a $250 million additional term loan under the existing Tranche B Term Loan facility and a new $1,750 million term loan credit facility that matures on December 31, 2018;

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• Secured Senior Notes due 2019 —issuance of an additional $1,375 million aggregate principal amount of 8 percent secured senior notes due June 15, 2019, at an issue price of 108.25 percent of the aggregate principal amount; and

• Secured Senior Notes due 2021 —issuance of an additional $1,380 million aggregate principal amount of 8  ¹⁄₄ percent secured senior notes due June 15, 2021 at an issue price of 110.50 percent of the aggregate principal amount, which, together with the secured senior notes issuance above, we refer to as the old notes.

The proceeds of these transactions were used to repay all amounts outstanding, including accrued and unpaid interest, of approximately $5.0 billion under the VEBA Trust Note. In connection with the repayment of the VEBA Trust Note, we expect to record a non-cash charge of approximately $500 million in the first quarter of 2014, consisting primarily of the remaining unamortized debt discount.

The outstanding principal amount of the Term Loan Credit Facility is payable in equal quarterly installments of approximately $4.4 million, commencing June 30, 2014, with the remaining balance due at maturity. All loans outstanding under the Term Loan Credit Facility bear interest, at our option, either at a base rate plus 1.50 percent per annum or at LIBOR plus 2.50 percent per annum, subject to a base rate floor of 1.75 percent per annum and a LIBOR floor of 0.75 percent per annum, respectively. We currently accrue interest based on LIBOR and the stated rate as of February 7, 2014 was 3.25 percent.

If we voluntarily refinance or re-price all or any portion of the Term Loan Credit Facility on or before August 7, 2014, under certain circumstances, we will be obligated to pay a call premium equal to 1.00 percent of the principal amount refinanced or re-priced. After that date, we may refinance or re-price under the Term Loan Credit Facility without premium or penalty.

Subsequent to the issuances of and subject to the limitations in the Senior Credit Facilities, the Term Loan Credit Facility and the Secured Senior Notes Indenture, we have the option to increase the amount of the Revolving Facility in an aggregate principal amount not to exceed $700 million, subject to certain conditions.

The remaining terms of the Term Loan Credit Facility and old notes are generally consistent with the terms of the existing Senior Credit Facilities and the Secured Senior Notes, respectively, as of December 31, 2013. Refer to —Senior Credit Facilities and—Secured Senior Notes, below for additional information on the terms of those agreements.

As of December 31, 2013, the significant terms of our principal debt instruments were as follows:

Senior Credit Facilities and Secured Senior Notes

On May 24, 2011, we and certain of our U.S. subsidiaries as guarantors entered into the following arrangements:

• Senior Credit Facilities — a $3.0 billion tranche B term loan maturing on May 24, 2017, which was fully drawn on May 24, 2011 and a $1.3 billion revolving credit facility that matures on May 24, 2016, and remains undrawn, which were subsequently amended and re-priced on June 21, 2013 to lower applicable interest rates, among other things, and the Tranche B Term Loan was subsequently re-priced on December 23, 2013 to further lower applicable interest rates;

• Secured Senior Notes due 2019 — issuance of $1.5 billion of 8 percent secured senior notes due June 15, 2019, or Original 2019 Notes; and

• Secured Senior Notes due 2021 — issuance of $1.7 billion of 8 ¹⁄₄ percent secured senior notes due June 15, 2021, or Original 2021 Notes.

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Senior Credit Facilities

The Senior Credit Facilities are with a syndicate of private sector lenders that provide for borrowings of up to $4.3 billion and include a revolving credit facility which may be borrowed and repaid from time to time until the maturity date. We amended and restated our Original Senior Credit Agreement. The amendments to the Original Senior Credit Agreement were given effect in the amended and restated credit agreement, dated as of June 21, 2013, or the Senior Credit Agreement. Additionally, on December 23, 2013 we re-priced the Tranche B Term Loan governed by the Senior Credit Agreement.

The Original Senior Credit Agreement provided for a $3.0 billion tranche B term loan that was to mature on May 24, 2017, which was fully drawn on May 24, 2011 and a $1.3 billion revolving credit facility that was to mature on May 24, 2016, which was undrawn. The maturity dates did not change under the Senior Credit Agreement. The Revolving Facility remains undrawn as of December 31, 2013.

The amendment in June 2013 reduced the applicable interest rate spreads on the Senior Credit Facilities by 1.50 percent per annum and reduced the rate floors applicable to the Tranche B Term Loan by 0.25 percent per annum. As a result, all amounts outstanding under the Revolving Facility will bear interest, at our option, either at a base rate plus 2.25 percent per annum or at LIBOR plus 3.25 percent per annum. The subsequent re-pricing in December 2013 further reduced the applicable interest rate spreads and interest rate floors applicable to the Tranche B Term Loan by an additional 0.50 percent and 0.25 percent, respectively, per annum. All amounts outstanding under the Tranche B Term Loan will bear interest, at our option, either at a base rate plus 1.75 percent per annum or at LIBOR plus 2.75 percent per annum, subject to a base rate floor of 1.75 percent per annum or a LIBOR floor of 0.75 percent per annum, respectively. We currently accrue interest based on LIBOR.

In addition, the amendment in June 2013 reduced the commitment fee payable on the Revolving Facility to 0.50 percent per annum, which may be reduced to 0.375 percent per annum if we achieve a specified consolidated leverage ratio, of the daily average undrawn portion of the Revolving Facility. The commitment fee remains payable quarterly in arrears.

The outstanding principal amount of the Tranche B Term Loan is payable in equal quarterly installments of $7.5 million, with the remaining balance due at maturity. No scheduled principal payments are required on amounts drawn on the Revolving Facility until the maturity date of the facility.

If we voluntarily refinance or re-price all or any portion of the Tranche B Term Loan before the six-month anniversary of the effective date of the re-pricing in December 2013, under certain circumstances, we will be obligated to pay a call premium equal to 1.00 percent of the principal amount refinanced or re-priced.

Certain negative covenants in the Original Senior Credit Agreement were also amended, including limitations on incurrence of indebtedness and certain limitations on restricted payments, which include dividends. Under the Senior Credit Agreement, among other exceptions, the restricted payment capacity was increased to an amount not to exceed 50 percent of our cumulative consolidated net income, as defined in the Senior Credit Agreement, since January 1, 2012.

In connection with the June 21, 2013 amendment and December 23, 2013 re-pricing, lenders party to the Tranche B Term Loan that held $790 million of the outstanding principal balance either partially or fully reduced their holdings. These reductions were accounted for as a debt extinguishments. The remaining holdings were analyzed on a lender-by-lender basis and accounted for as debt modifications. The outstanding principal balance on the Tranche B Term Loan did not change, as new and continuing lenders acquired the $790 million.

We paid $38 million related to the call premium and other fees to re-price and amend the Original Senior Credit Agreement and re-price the Tranche B Term Loan, of which $30 million was deferred and will be amortized over the remaining terms of the Senior Credit Facilities. We recognized a $24 million loss on extinguishment of debt,

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which included the write off of $13 million of unamortized debt discounts and $3 million of unamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of the call premium and fees noted above.

Up to $200 million of the Revolving Facility may be used for the issuance of letters of credit. Prior to the final maturity date of each of the facilities, we have the option to extend the maturity date of all or a portion of these facilities with the consent of the lenders whose loans or commitments are being extended. Prior to the Refinancing Transactions discussed above, we had the option to increase the amount of these facilities in an aggregate principal amount not to exceed $1.2 billion, either through an additional term loan, an increase in the Revolving Facility or a combination of both, subject to certain conditions.

Mandatory prepayments are required, subject to certain exceptions, from the net cash proceeds of asset sales, incurrence of additional indebtedness, insurance or condemnation proceeds and excess cash flow. In the case of excess cash flow, the mandatory prepayments are subject to a leverage-based step-down and only to the extent our liquidity exceeds a certain threshold.

The Senior Credit Facilities are secured by a senior priority security interest in substantially all of Chrysler Group LLC’s assets and the assets of its U.S. subsidiary guarantors, subject to certain exceptions. The collateral includes 100 percent of the equity interests in Chrysler Group LLC’s domestic subsidiaries and 65 percent of the equity interests in certain foreign subsidiaries held directly by Chrysler Group LLC and its U.S. subsidiary guarantors.

The Senior Credit Agreement includes a number of affirmative covenants, many of which are customary, including, but not limited to, the reporting of financial results and other developments, compliance with laws, payment of taxes, maintenance of insurance and similar requirements. The Senior Credit Agreement also contains several negative covenants, including but not limited to, (i) limitations on incurrence, repayment and prepayment of indebtedness; (ii) limitations on incurrence of liens; (iii) limitations on making restricted payments, including a limit on declaring dividends or making distributions to our members or stockholders, as the case may be; (iv) limitations on transactions with affiliates, swap agreements and sale and leaseback transactions; (v) limitations on fundamental changes, including certain asset sales and (vi) restrictions on certain subsidiary distributions. In addition, the Senior Credit Agreement requires us to maintain a minimum ratio of borrowing base to covered debt, as well as a minimum liquidity of $3.0 billion, which includes any undrawn amounts on the Revolving Facility.

The Senior Credit Agreement contains a number of events of default related to, (i) failure to make payments when due; (ii) failure to comply with covenants; (iii) breaches of representations and warranties; (iv) certain changes of control; (v) cross-default with certain other debt and hedging agreements and (vi) the failure to pay or post bond for certain material judgments. As of December 31, 2013 we were in compliance with all covenants under the Senior Credit Agreement.

Refer to —New Debt Issuances and Repayment of the VEBA Trust Note, above, for information regarding the additional term loan borrowing under the Senior Credit Agreement and Term Loan Credit Facility.

Secured Senior Notes

We entered into an indenture with CG Co-Issuer Inc., our 100 percent owned special purpose finance subsidiary, certain of our 100 percent owned U.S. subsidiaries, and Wilmington Trust FSB, as trustee and Citibank, N.A. as collateral agent, paying agent, registrar and authenticating agent, pursuant to which we issued the Original 2019 Notes and Original 2021 Notes, collectively referred to as the Original Notes. The Original Notes were issued at par and were sold in a private placement to (i) qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended, or the Securities Act, and (ii) outside the United States to persons who are not U.S. persons (as defined in Rule 902 of Regulation S under the Securities Act) in compliance with Regulation S under the Securities Act.

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In connection with the offering of the Original Notes, we entered into the Registration Rights Agreement with the initial purchasers of the Original Notes. Under the terms of the Registration Rights Agreement, we agreed to register notes having substantially identical terms as the Original Notes with the SEC as part of an offer to exchange freely tradable exchange notes for the Original Notes. On December 29, 2011, and subject to the terms and conditions set forth in our prospectus, we commenced an offer to exchange our new 8 percent secured senior notes due 2019, or 2019 Notes, for the outstanding Original 2019 Notes and our new 8 ¹⁄₄ percent secured senior notes due 2021, or 2021 Notes, for the outstanding Original 2021 Notes. The 2019 Notes and 2021 Notes are collectively referred to as the Notes.

On February 1, 2012, our offers to exchange the Original 2019 Notes and Original 2021 Notes expired. Substantially all of the Original Notes were tendered for the Notes. The holders of the Notes received an equal principal amount of 2019 Notes for the Original 2019 Notes and an equal principal amount of 2021 Notes for the Original 2021 Notes. The form and terms of the Notes are identical in all material respects to the Original Notes, except that the Notes do not contain restrictions on transfer.

Beginning December 15, 2011, interest on each series of the Original Notes is payable semi-annually in June and December of each year, to the holders of record of such Original Notes at the close of business on June 1 or December 1, respectively, preceding such interest payment date.

We may redeem, at any time, all or any portion of the 2019 Notes on not less than 30 and not more than 60 days’ prior notice mailed to the holders of the 2019 Notes to be redeemed. Prior to June 15, 2015, the 2019 Notes will be redeemable at a price equal to the principal amount of the 2019 Notes being redeemed, plus accrued and unpaid interest to the date of redemption and a “make-whole” premium calculated under the indenture. At any time prior to June 15, 2014, we may also redeem up to 35 percent of the aggregate principal amount of the 2019 Notes, at a redemption price equal to 108 percent of the principal amount of the 2019 Notes being redeemed, plus accrued and unpaid interest to the date of redemption with the net cash proceeds from certain equity offerings. On and after June 15, 2015, the 2019 Notes are redeemable at redemption prices specified in the 2019 Notes, plus accrued and unpaid interest to the date of redemption. The redemption price is initially 104 percent of the principal amount of the 2019 Notes being redeemed for the twelve months beginning June 15, 2015, decreasing to 102 percent for the year beginning June 15, 2016 and to par on and after June 15, 2017.

We may redeem, at any time, all or any portion of the 2021 Notes on not less than 30 and not more than 60 days’ prior notice mailed to the holders of the 2021 Notes to be redeemed. Prior to June 15, 2016, the 2021 Notes will be redeemable at a price equal to the principal amount of the 2021 Notes being redeemed, plus accrued and unpaid interest to the date of redemption and a “make-whole” premium calculated under the indenture. At any time prior to June 15, 2014, we may also redeem up to 35 percent of the aggregate principal amount of the 2021 Notes, at a redemption price equal to 108.25 percent of the principal amount of the 2021 Notes being redeemed, plus accrued and unpaid interest to the date of redemption with the net cash proceeds from certain equity offerings. On and after June 15, 2016, the 2021 Notes are redeemable at redemption prices specified in the 2021 Notes, plus accrued and unpaid interest to the date of redemption. The redemption price is initially 104.125 percent of the principal amount of the 2021 Notes being redeemed for the twelve months beginning June 15, 2016, decreasing to 102.75 percent for the year beginning June 15, 2017, to 101.375 percent for the year beginning June 15, 2018 and to par on and after June 15, 2019.

The indenture includes affirmative covenants, including the reporting of financial results and other developments. The indenture also contains negative covenants related to our ability and, in certain instances, the ability of certain of our subsidiaries to, (i) pay dividends or make distributions on the Company’s capital stock or repurchase the Company’s capital stock; (ii) make restricted payments; (iii) create certain liens to secure indebtedness; (iv) enter into sale and leaseback transactions; (v) engage in transactions with affiliates; (vi) merge or consolidate with certain companies and (vii) transfer and sell assets.

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The indenture provides for customary events of default, including but not limited to, (i) nonpayment; (ii) breach of covenants in the indenture; (iii) payment defaults or acceleration of other indebtedness; (iv) a failure to pay certain judgments and (v) certain events of bankruptcy, insolvency and reorganization. If certain events of default occur and are continuing, the trustee or the holders of at least 25 percent in aggregate of the principal amount of the Notes outstanding under one of the series may declare all of the Notes of that series to be due and payable immediately, together with accrued interest, if any. As of December 31, 2013, we were in compliance with all covenants under the indenture.

Refer to —New Debt Issuances and Repayment of the VEBA Trust Note,above, for information regarding our issuance of the old notes.

VEBA Trust Note

On June 10, 2009, and in accordance with the terms of a settlement agreement between us and the UAW, or the VEBA Settlement Agreement, we issued a senior unsecured note with a face value of $4,587 million to the VEBA Trust.

The VEBA Trust Note has an implied interest rate of 9.0 percent per annum and requires annual payments of principal and interest on July 15. Scheduled VEBA Trust Note payments through 2012 did not fully satisfy the interest accrued at the implied rate. In accordance with the agreement, the difference between a scheduled payment and the accrued interest through June 30 of the payment year was capitalized as additional debt on an annual basis. In July 2013, we made a scheduled payment of $600 million, which was composed of $441 million of interest accrued through the payment date and $159 million of interest that was previously capitalized as additional debt. In July 2012 and 2011, we made scheduled payments of $400 million and $300 million, respectively, on the VEBA Trust Note and $38 million and $126 million, respectively, of accrued interest was capitalized as additional debt.

The payment of capitalized interest is included as a component of Net Cash Provided by Operating Activities in the accompanying audited Consolidated Statements of Cash Flows.

The VEBA Trust Note was issued under the terms of an indenture that contains certain negative covenants, including, but not limited to, limitations on incurrence of indebtedness by Chrysler Group LLC that is senior, in any respect, in right of payment to the VEBA Trust Note and limits on the ability of our subsidiaries to incur indebtedness. The terms of a related registration rights agreement provide for certain registration rights that entitle the holder of the VEBA Trust Note to require us to file a registration statement under the Securities Act, for a public offering of the VEBA Trust Note beginning six months following Fiat’s acquisition of a majority ownership interest in us, which occurred in July 2011, and such rights became effective in January 2012.

Refer to Note 12,Financial Liabilities, and Note 18,Employee Retirement and Other Benefits, of the accompanying audited consolidated financial statements for additional information regarding the VEBA Trust Note and VEBA Settlement Agreement.

Refer to —New Debt Issuances and Repayment of the VEBA Trust Note, above, for information regarding the repayment of the VEBA Trust Note.

Canadian Health Care Trust Notes

On December 31, 2010, Chrysler Canada Inc., or Chrysler Canada, issued four unsecured promissory notes to the HCT in an initial aggregate face value of $976 million ($974 million Canadian dollar, or CAD), which we collectively refer to as the Canadian HCT Notes. These notes were issued as part of the settlement of its obligations with respect to retiree health care benefits for CAW (now part of Unifor) represented employees, retirees and dependents, which we refer to as the Canadian Health Care Trust Settlement Agreement. In addition, the Canadian

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HCT Notes had accrued interest from January 1, 2010 through December 31, 2010 of $80 million ($80 million CAD) and a $31 million ($31 million CAD) net premium.

The terms of each of the notes are substantially similar and provide that each note will rankpari passu with all existing and future unsecured and unsubordinated indebtedness for borrowed money of Chrysler Canada, and that Chrysler Canada will not incur indebtedness for borrowed money that is senior in any respect in right of payment to the notes.

Payments on the Canadian HCT Notes are due on June 30 of each year unless that day is not a business day in Canada, in which case payments are due on the next business day, or the Scheduled Payment Date. Interest is accrued at the stated rate of 9.0 percent per annum for the HCT Tranche A and B notes. Accrued interest in excess of payments on the HCT Tranche A and B notes is capitalized as additional debt on the Scheduled Payment Date. We are not required to make a payment on the Canadian Health Care Trust Note – Tranche C, or HCT Tranche C note, until 2020. However, interest accrued at the stated rate of 7.5 percent per annum on the HCT Tranche C note will be capitalized as additional debt on the Scheduled Payment Date through 2019. In July 2013, July 2012 and June 2011, $25 million, $74 million and $27 million, respectively, of interest accrued in excess of the scheduled payments was capitalized as additional debt.

In July 2013, we made a scheduled payment on the HCT Tranche B note of $66 million, which was composed of $44 million of interest accrued through the payment date and $22 million of interest that was previously capitalized as additional debt.

In January 2013, we made a prepayment on the HCT Tranche A note of the scheduled payment due on July 2, 2013. The amount of the prepayment, determined in accordance with the terms of the HCT Tranche A note, was $117 million and was composed of a $92 million principal payment and interest accrued through January 3, 2013 of $25 million. The $92 million HCT Tranche A note principal payment consisted of $47 million of interest that was previously capitalized as additional debt with the remaining $45 million representing a repayment of the original principal balance.

In 2012 and 2011, we made payments of $44 million and $47 million, respectively, on the Canadian HCT Notes, which included principal and interest accrued through the respective payment dates. The HCT Tranche D note was fully repaid in 2012.

The payments of capitalized interest are included as a component of Net Cash Provided by Operating Activities in the accompanying audited Consolidated Statements of Cash Flows.

Refer to Note 12,Financial Liabilities, of the accompanying audited consolidated financial statements for additional information related to the Canadian HCT Notes and Canadian Health Care Trust Settlement Agreement.

Mexico Development Banks Credit Facilities

In July 2010, Chrysler de Mexico, S.A. de C.V., or Chrysler de Mexico, our principal operating subsidiary in Mexico, entered into a financing arrangement with certain Mexican development banks which provides for a 15 year amortizing term loan facility equal to the Mexican peso equivalent of $400 million. The facility was fully drawn during July 2010 and was funded in Mexican pesos. Any amounts repaid on the facility cannot be re-borrowed.

In December 2011, Chrysler de Mexico entered into a financing arrangement with certain Mexican development banks which provides for a ten year amortizing term loan facility of 3.0 billion Mexican pesos. The facility was fully drawn during December 2011 and was funded in Mexican pesos. Principal payments on the loan are not required until 2016, and any amounts repaid cannot be re-borrowed.

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The terms of these loans are similar. Chrysler de Mexico placed certain of its assets in special purpose trusts to secure repayment of the loans, including certain receivables and property, plant and equipment. As of December 31, 2013 and 2012, Chrysler de Mexico had $56 million and $66 million, respectively, of cash on deposit with the trusts, which is included in Prepaid Expenses and Other Assets in the accompanying Consolidated Balance Sheets. The loans require compliance with certain covenants, including but not limited to, limitations on liens, incurrence of debt and asset sales. As of December 31, 2013, we were in compliance with all covenants under the facilities.

Gold Key Lease

Chrysler Canada maintains our Gold Key Lease vehicle lease portfolio. The related vehicles are leased to Canadian consumers and were financed by asset-backed securitization facilities, as well as a $4.7 billion ($5.0 billion CAD) secured revolving credit facility. In June 2012, we repaid the remaining outstanding balance of the asset-backed note payable. These obligations were primarily repaid out of collections from the operating leases and proceeds from the sales of the related vehicles. We are currently winding down the Gold Key Lease program, therefore, no additional funding will be required. No vehicles were added to the portfolio during the years ended December 31, 2013 and 2012.

U.S. Treasury Credit Facilities

On June 10, 2009, and in connection with the 363 Transaction, we entered into a first lien credit agreement with the U.S. Treasury, which included a $2.0 billion term loan, or Tranche B Loan, used to acquire substantially all of the net operating assets of Old Carco. The credit agreement also made various term loans available to us for future working capital needs in an amount not to exceed $4.6 billion, or Tranche C Commitment. In addition, we provided the U.S. Treasury a $288 million note and assumed $500 million of U.S. Treasury loans originally provided to Chrysler Holding LLC for the benefit of Old Carco. We also provided the U.S. Treasury a $100 million zero coupon note.

The Tranche C Commitment was scheduled to accrue quarterly PIK interest of a maximum of $17 million through June 10, 2017, and the PIK interest was to be capitalized on a quarterly basis. Accordingly, $17 million and $68 million of PIK interest was capitalized as additional debt during the three months ended March 31, 2011 and the year ended December 31, 2010, respectively.

On May 24, 2011, we repaid all amounts owed under the U.S. Treasury first lien credit agreement and terminated all lending commitments thereunder. See—Repayment of U.S. Treasury and EDC Credit Facilities, below, for additional information.

Export Development Canada Credit Facilities

Chrysler Canada entered into a loan and security agreement with EDC on March 30, 2009, which was subsequently amended on April 29, 2009, pursuant to which the EDC provided a $1,238 million ($1,209 million CAD) secured term loan facility known as Tranche X. On June 10, 2009, the EDC loan agreement was amended and restated to increase the secured term loan facility by a CAD equivalent of $909 million USD, up to a maximum of $1,116 million CAD. The increase in the loan facility was known as Tranche X-2. In addition to the Tranche X and Tranche X-2 loans, Chrysler Canada provided the EDC additional notes of $81 million ($80 million CAD). The additional notes were included in the Tranche X facility.

On May 24, 2011, we repaid all amounts owed under the EDC loan and security agreement and terminated all lending commitments thereunder. See—Repayment of U.S. Treasury and EDC Credit Facilities, below, for additional information.

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Repayment of U.S. Treasury and EDC Credit Facilities

On May 24, 2011, we repaid all amounts outstanding under the U.S. Treasury and EDC credit facilities. Refer to —U.S. Treasury Credit Facilitiesand —Export Development Canada Credit Facilities, above, for additional information related to these agreements.

Payments were made as follows (in millions of dollars):

	Principal		Accrued Interest		Total Payment
U.S. Treasury first lien credit facilities:
Tranche B	$	2,080 (1)	$	22	$	2,102
Tranche C		3,675 (2)		65		3,740
Zero Coupon Note		100		—		100
Total U.S. Treasury first lien credit facilities		5,855		87		5,942
EDC credit facilities:
Tranche X		1,319		14		1,333
Tranche X-2		404		4		408
Total EDC credit facilities		1,723		18		1,741
Total U.S. Treasury and EDC credit facilities	$	7,578	$	105	$	7,683

(1) Includes $80 million of PIK interest previously capitalized. The payment of PIK interest is included as a component of Net Cash Provided by Operating Activities in the accompanying audited Consolidated Statements of Cash Flows.

(2) Includes $315 million of PIK interest previously capitalized. The payment of PIK interest is included as a component of Net Cash Provided by Operating Activities in the accompanying audited Consolidated Statements of Cash Flows. In addition, as a result of the termination of the Ally MTA and in accordance with the U.S. Treasury first lien credit agreement, amounts outstanding under that agreement were reduced by $4 million, the amount of qualifying losses incurred by Ally through April 2011. Refer to Note 14,Commitments, Contingencies and Concentrations, of the accompanying audited consolidated financial statements for additional information related to the Ally MTA.

SCUSA Private-Label Financing Agreement

In February 2013, we entered into a private-label financing agreement with SCUSA. The new financing arrangement launched on May 1, 2013. Under the SCUSA Agreement, SCUSA provides a wide range of wholesale and retail financing services to our dealers and consumers in accordance with its usual and customary lending standards, under the Chrysler Capital brand name. The financing services include credit lines to finance our dealers’ acquisition of vehicles and other products that we sell or distribute, retail loans and leases to finance consumer acquisitions of new and used vehicles at our dealerships, financing for commercial and fleet customers, and ancillary services. In addition, SCUSA will work with dealers to offer them construction loans, real estate loans, working capital loans and revolving lines of credit.

Under the new financing arrangement, SCUSA has agreed to specific transition milestones for the initial year following launch. If the transition milestones are met, or otherwise satisfactory to us, the SCUSA Agreement will have a ten-year term, subject to early termination in certain circumstances, including the failure by a party to comply with certain of its ongoing obligations under the SCUSA Agreement. In accordance with the terms of the agreement, SCUSA provided us an upfront, nonrefundable payment of $150 million in May 2013, which was recognized as deferred revenue and will be amortized over ten years. As of December 31, 2013, $140 million remained in Deferred Revenue in the accompanying audited Consolidated Balance Sheets.

We have provided SCUSA with limited exclusivity rights to participate in specified minimum percentages of certain of our retail financing rate subvention programs. SCUSA has committed to certain revenue sharing

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arrangements, as well as to consider future revenue sharing opportunities. SCUSA bears the risk of loss on loans contemplated by the SCUSA Agreement. The parties share in any residual gains and losses in respect of consumer leases, subject to specific provisions in the SCUSA Agreement, including limitations on our participation in gains and losses.

Ally MTA

Prior to May 2011, we were a party to the Ally MTA between the U.S. Treasury, Ally and USDART. The Ally MTA provided for a risk sharing arrangement, in which USDART would reimburse Ally for qualifying losses on loans with our third party Chrysler Group dealerships issued prior to November 21, 2009. In May 2011, all parties mutually agreed to terminate the Ally MTA. Under the terms of the agreement, $96 million, which represented the remaining balance of a previous advance to USDART, was transferred to us. In addition, under the terms of the U.S. Treasury first lien credit agreement, amounts outstanding under that agreement were reduced by $4 million, the amount of qualifying losses incurred by Ally through April 2011.

Daimler Tax Receivable

During the year ended December 31, 2011, we received reimbursements from Daimler of $374 million related to tax payments previously made by us which had been previously applied by the Canada Revenue Agency and the Provincial Tax Authorities against additional taxes assessed related to the Canadian transfer pricing matter. No such reimbursements were received during the years ended December 31, 2013 and 2012.

For additional information related to the Daimler tax receivable, refer to Note 13,Income Taxes, of our accompanying audited consolidated financial statements.

Cash Management & Risk Management Policies

Our cash management and risk management activities are governed by internal policies designed to: (i) maintain appropriate internal control over disbursements; (ii) ensure our ability to pay all outstanding obligations when due; and (iii) obtain a reasonable return while maintaining appropriate diversification and minimizing counterparty risk. These policies include permitted investment guidelines, counterparty evaluation and limits, derivative guidelines, funding guidelines, credit and collections guidelines, compliance monitoring, internal control requirements and controls over electronic funds transactions.

Investments of Corporate Cash

Cash and cash equivalents are primarily invested in short-term instruments with highly rated counterparties. Counterparties are evaluated in accordance with internal guidelines. Limits are established for each approved counterparty and actual exposures are tracked against the limits.

Defined Benefit Pension Plans and OPEB Plans —Contributions and Funded Status

Contributions and Payments.Our funding policy for defined benefit pension plans is to contribute at least the minimum amounts required by applicable laws and regulations. Occasionally, additional discretionary contributions in excess of those legally required are made to achieve certain desired funding levels. In the U.S. and Canada, these excess amounts are tracked, and the resulting credit balance can be used to satisfy minimum funding requirements in future years. As of December 31, 2013, the combined credit balances for our U.S. and Canadian qualified pension plans is approximately $2.6 billion. While the usage of credit balances to satisfy minimum funding requirements is subject to our plans maintaining certain funding levels, we expect to be able to utilize the credit balances in 2014 such that no significant additional cash contributions are required for our U.S. and Canadian plans in 2014, although we may voluntarily elect to make contributions.

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The following summarizes employer contributions made to our defined benefit pension plans or direct benefit payments to plan participants (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Total employer contributions	$	584	$	254	$	362

In connection with the 363 Transaction, we acquired a $600 million receivable from a subsidiary of Daimler to fund contributions to our U.S. pension plans. This receivable was payable to us in three equal annual installments beginning in 2009 with the third and final $200 million installment received in 2011. Amounts received were utilized to fund a portion of our contributions to our funded pension plans in each year upon receipt of the installments.

Employer contributions to our U.S. funded pension plans are expected to be $833 million in 2014, of which of $790 million are discretionary contributions; and $43 million are mandatory contributions, to satisfy minimum funding requirements. Employer contributions to our unfunded pension and OPEB plans in 2014 are expected to be $58 million and $178 million, respectively, which represents the expected benefit payments to participants.

The following summarizes net benefit payments expected to be paid, based on the last remeasurement of all of our plans as of December 31, 2013 which reflects estimated future employee service (in millions of dollars):

	Pension Benefits		OPEB
2014	$	2,243	$	181
2015		2,200		178
2016		2,162		177
2017		2,128		176
2018		2,103		175
2019 — 2023		10,177		876

During the life of the plans, we intend to primarily utilize plan assets to fund benefit payments and minimize our cash contributions. OPEB payments are currently funded from our cash flows from operations.

Defined Benefit Pension Plans —Funded Status.The following summarizes the funded status of our pension plans (in millions of dollars):

	December 31,
	2013			2012
Benefit obligation	$	31,106		$	34,837
Fair value of plan assets		25,654			25,972
Funded status of plans	$	(5,452	)	$	(8,865	)

The change in funded status from December 31, 2012 to December 31, 2013 was primarily due to the impacts of changes in discount rates of $2,135 million and company contributions of $584 million made during 2013 as well as the impact of the pension plan curtailment and amendment during the second quarter of 2013 of $218 million and the related remeasurement of $553 million. These changes were partially offset by service and interest costs of $1,711 million.

OPEB Plans —Funded Status

Our OPEB plans were underfunded by $2,724 million at December 31, 2013 and by $3,073 million at December 31, 2012. The change in funded status was primarily due to the impacts of changes in discount rates

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and actuarial assumptions of $293 million and company contributions of $172 million made directly to pay benefits. These changes were partially offset by service and interest costs of $150 million.

For additional information related to our defined benefit pension and OPEB plans, refer to Note 18,Employee Retirement and Other Benefits, of our accompanying audited consolidated financial statements.

Off-Balance Sheet Arrangements

We have entered into various off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, results of operations or liquidity. These include variable interest entities, or VIEs. For a discussion of our VIEs, refer to Note 4,Variable Interest Entities, of our accompanying audited consolidated financial statements.

Arrangements with Key Suppliers

From time to time, in the ordinary course of our business, we enter into various arrangements with key suppliers in order to establish strategic and technological advantages. A limited number of these arrangements contain unconditional purchase obligations to purchase a fixed or minimum quantity of goods and/or services with fixed and determinable price provisions. Purchases under these arrangements from third parties were $222 million, $437 million and $674 million for the years ended December 31, 2013, 2012 and 2011, respectively.

In addition, certain of the arrangements we have entered into with Fiat contain unconditional purchase obligations to purchase a fixed or minimum quantity of goods and/or services with fixed and determinable price provisions. Purchases under these arrangements were $372 million, $383 million and $305 million for the years ended December 31, 2013, 2012 and 2011, respectively.

We also enter into similar arrangements containing unconditional purchase obligations to purchase a minimum quantity of goods for which pricing is variable, and therefore do not have fixed and determinable future payment streams. Under these arrangements we are obligated to make payments or receive reimbursements if our purchase volumes are outside a specified range of values. Purchases from third parties under these arrangements were $412 million, $441 million and $346 million for the years ended December 31, 2013, 2012 and 2011, respectively. We did not have any purchases from unconsolidated related companies under these arrangements.

Contractual Obligations

The following summarizes payments due under our significant contractual obligations and commitments as of December 31, 2013 (in millions of dollars):

	Payments Due by Period
	2014(4)		2015-2016		2017-2018		2019 and thereafter		Total
Financial liabilities (1)	$	442	$	952	$	4,014	$	7,168	$	12,576
Capital lease obligations(1)		64		121		117		78		380
Interest on long-term financial liabilities and capital lease obligations (2)		955		1,803		1,451		1,572		5,781
Operating lease commitments		137		201		131		187		656
Unconditional minimum purchase obligations		275		367		100		30		772
Pension contribution requirements (3)		43		—		—		—		43
Total	$	1,916	$	3,444	$	5,813	$	9,035	$	20,208

(1) The amounts above are before any fair value adjustments, discounts, premiums and loan origination fees totaling $655 million. For additional information refer to Note 12, Financial Liabilities, of our accompanying audited consolidated financial statements.

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(2) Amounts include interest payments based on contractual terms and current interest rates on our debt and capital lease obligations. Interest payments based on variable rates included above were determined using the current interest rate in effect at December 31, 2013.

(3) Pension contribution requirements are based on an estimate of our minimum funding requirements pursuant to the Employee Retirement Income Security Act, or ERISA, regulations. We expect required contributions to be approximately $43 million in 2014. We may elect to make contributions in excess of the minimum funding requirements in response to investment performance and changes in interest rates, to achieve funding levels required by our defined benefit plan arrangements, or when we believe that it is financially advantageous to do so and based on our other capital requirements. We plan to make $790 million of discretionary contributions to our U.S. plans in 2014. Our minimum funding requirements after 2014 will depend on several factors, including investment performance and interest rates. Therefore, the above excludes payments beyond 2014, since we cannot predict with reasonable reliability the timing and amounts of future minimum funding requirements. Excluded from above are expected payments of $58 million and $178 million due in 2014 with respect to our unfunded pension and OPEB plans, respectively, which represent the expected benefit payments to participants as costs are incurred.

(4) Uncertain tax positions of $83 million are excluded from the table above because we cannot make a reasonably reliable estimate of the period of cash settlement with the respective taxing authorities. Refer to Note 13, Income Taxes, of the accompanying audited consolidated financial statements for further information.

The above also excludes payments for product warranty costs. We issue various types of product warranties under which we generally guarantee the performance of products delivered for a certain period or term. We also periodically initiate voluntary service and recall actions to address various customer satisfaction, safety and emissions issues related to vehicles we sell. The estimated future costs of these actions are principally based on assumptions regarding the lifetime warranty costs of each vehicle line and each model year of that vehicle line, as well as historical claims experience for our vehicles. Estimates of the future costs of these actions are inevitably imprecise due to numerous uncertainties, including the enactment of new laws and regulations, the number of vehicles affected by a service or recall action and the nature of the corrective action. It is reasonably possible that the ultimate cost of these service and recall actions may require us to make expenditures in excess of established reserves over an extended period of time and in a range of amounts that cannot be reasonably estimated. As of December 31, 2013, our product warranty reserves were approximately $3.8 billion.

For additional information regarding long-term financial liabilities and employee retirement and other benefits, see Note 12,Financial Liabilities, and Note 18,Employee Retirement and Other Benefits, respectively, of our accompanying audited consolidated financial statements.

Ally Repurchase Obligation

In April 2013, the Ally Agreement was terminated. Refer toBusiness —Distribution —Dealer and Customer Financing, regarding our new private-label financing agreement with SCUSA.

In accordance with the terms of the Ally Agreement, we remain obligated to repurchase Ally-financed U.S. dealer inventory that was acquired on or before April 30, 2013, upon certain triggering events and with certain exceptions, in the event of an actual or constructive termination of a dealer’s franchise agreement, including in certain circumstances when Ally forecloses on all assets of a dealer securing financing provided by Ally. These obligations exclude vehicles that have been damaged or altered, that are missing equipment or that have excessive mileage or an original invoice date that is more than one year prior to the repurchase date.

As of December 31, 2013, the maximum potential amount of future payments required to be made to Ally under this guarantee was approximately $230 million and was based on the aggregate repurchase value of eligible vehicles financed by Ally in our U.S. dealer stock. If vehicles are required to be repurchased under this arrangement, the total exposure would be reduced to the extent the vehicles can be resold to another dealer. The fair value of the guarantee was less than $0.1 million at December 31, 2013, which considers both the likelihood that the triggering events will occur and the estimated payment that would be made net of the estimated value of inventory that would be reacquired upon the occurrence of such events. The estimates are based on historical experience.

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Other Repurchase Obligations

In accordance with the terms of other wholesale financing arrangements in Mexico, we are required to repurchase dealer inventory financed under these arrangements, upon certain triggering events and with certain exceptions, including in the event of an actual or constructive termination of a dealer’s franchise agreement. These obligations exclude certain vehicles including, but not limited to, vehicles that have been damaged or altered, that are missing equipment or that have excessive mileage or an original invoice date that is more than one year prior to the repurchase date.

As of December 31, 2013, the maximum potential amount of future payments required to be made in accordance with these other wholesale financing arrangements was approximately $361 million and was based on the aggregate repurchase value of eligible vehicles financed through such arrangements in the respective dealer’s stock. If vehicles are required to be repurchased through such arrangements, the total exposure would be reduced to the extent the vehicles can be resold to another dealer. The fair value of the guarantee was less than $0.1 million at December 31, 2013, which considers both the likelihood that the triggering events will occur and the estimated payment that would be made net of the estimated value of inventory that would be reacquired upon the occurrence of such events. The estimates are based on historical experience.

Quantitative and Qualitative Disclosures about Market Risk

Due to the nature of our business, we are exposed to a variety of market risks, including foreign currency exchange rate risk, commodity price risk, interest rate risk and counterparty risk. We evaluate these risks on an on-going basis and manage our exposures centrally. Our Foreign Exchange Hedging Committee and Commodity Hedging Committee approve derivative hedging strategies to manage our operating risk exposures for foreign exchange and commodities, respectively.

The members of these committees include the Chief Financial Officer, the Treasurer and other senior operating management of the Company. The Treasury Department executes derivative transactions in accordance with the approved strategies, as well as within our risk management policies.

We use derivatives (primarily forward contracts, swaps and options) to hedge our financial and operational exposures. We do not enter into derivative transactions for speculative purposes or to hedge our balance sheet translation risk. Refer to Note 16,Derivative Financial Instruments and Risk Management,of our accompanying audited consolidated financial statements for additional information on our derivatives.

We use sensitivity analyses to quantify the impact of changes in foreign currency exchange rates, commodity prices and interest rates on the fair value of the financial instruments used to hedge these risks. Our models assume instantaneous, parallel shifts in foreign currency exchange rates, commodity prices and interest rate yield curves.

Foreign Currency Exchange Rate Risk

We are exposed to foreign currency exchange rate risk as a result of sales of vehicles and parts, purchases of components used in our manufacturing operations, debt and dividend payments from foreign subsidiaries denominated in currencies other than the USD. Foreign currency exchange rate risk is the risk that fluctuations in specific currencies against the USD will negatively impact our results of operations. To the extent possible, we net sales and purchases in specific currencies against each other and review this net cash flow position for hedging purposes. We are most vulnerable to fluctuations in the CAD, Euro, Australian dollar, Japanese yen and Mexican peso against the USD. To manage these exposures, we enter into derivative contracts (primarily currency forward and swap contracts) to hedge a portion of our exposures. The derivative contracts used to hedge foreign exchange rate risk had remaining maturities of up to 12 months at December 31, 2013.

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The net fair value of foreign currency derivatives at December 31, 2013 was an asset of $104 million compared to a liability of $38 million as of December 31, 2012. The potential decrease in the fair value of our foreign currency derivatives, assuming a 10 percent adverse change in the underlying foreign currency derivative versus the USD, would be approximately $197 million at December 31, 2013, compared with a decrease of $365 million as of December 31, 2012.

In addition, we are exposed to foreign currency exchange rate risk as a result of translating the assets and liabilities of our subsidiaries outside of the United States (primarily Canada, Mexico and Venezuela) into USD. In February 2013, the Venezuelan government announced a devaluation of the official exchange rate of the VEF, relative to the USD from 4.30 VEF per USD to 6.30 VEF per USD. As a result of this devaluation, we recognized a $78 million foreign currency translation loss as a reduction to Revenues, Net in the accompanying Condensed Consolidated Statements of Income during the three months ended March 31, 2013. Subsequent to the devaluation, certain monetary liabilities, which had been submitted to the CADIVI for payment approval through the ordinary course of business prior to the devaluation date, were approved to be paid at an exchange rate of 4.30 VEF per USD. As a result, during the year ended December 31, 2013 we recognized foreign currency transaction gains in Revenues, Net of $22 million, respectively, due to these monetary liabilities being previously remeasured at 6.30 VEF per USD at the devaluation date. No other events occurred during 2013 that resulted in changes to the VEF to USD official exchange rate. If the VEF were devalued further, it would result in a charge to our income statement in the period of devaluation. Based on our December 31, 2013 net monetary assets, a charge of approximately $35 million would result for every 10 percent devaluation of the VEF.

In December 2013, a new decree became effective requiring the Venezuelan government to set prices for all vehicles, parts and accessories sold in the country. The Venezuelan government continues to have foreign exchange control regulations that make it difficult to convert VEF to USD which affect our Venezuelan subsidiary’s ability to pay non-VEF denominated obligations and to pay dividends. In 2014, the Venezuelan government announced changes to the foreign exchange process which could affect the rate at which our Venezuelan subsidiary buys USD. The financial impact on our operations in Venezuela of these events and associated ongoing restrictions is uncertain. We continue to monitor these events and assess their impact to our operations and related 2014 financial results.

In addition, in March 2013, the Venezuelan government announced a new currency exchange system, the Complementary System of Foreign Currency Acquirement, or SICAD. The SICAD system will operate parallel to the CADIVI, and replace the Transaction System for Foreign Currency Denominated Securities. The SICAD is intended to function as a public bidding system for private entities that import goods. We are currently monitoring and assessing the currency exchange rates and restrictions associated with the new system.

Commodity Price Risk

We are exposed to changes in the prices of commodities used in the manufacture of vehicles, such as non-ferrous metals (e.g. aluminum, lead and copper), precious metals (e.g. platinum and palladium) and energy (e.g. natural gas). Commodity price risk is the adverse impact that changes in commodity prices would have on our financial results. To manage this risk, we enter into commodity derivative contracts (e.g. financially settled swap and option contracts) for a portion of our exposures. The derivative contracts used to hedge commodity price risk had remaining maturities of up to 17 months at December 31, 2013.

The net fair value of commodity derivatives as of December 31, 2013 was $0 compared to an asset of $19 million as of December 31, 2012. The potential decrease in the fair value of our commodity derivatives, due to a 10 percent decrease in commodity prices, would be approximately $54 million at December 31, 2013, compared with a decrease of $64 million as of December 31, 2012. This amount does not include the offsetting impact of lower prices we would pay for the underlying commodities.

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Interest Rate Risk

We are exposed to interest rate risk due to our interest-bearing investment portfolio and financing activities. Interest rate risk is the risk of loss we would incur due to changes in interest rates.

For purposes of sensitivity analyses, we segregated our interest-bearing financial instruments into fixed or floating. For fixed-rate financial instruments, our sensitivity analysis measures the changes in fair value, whereas for floating-rate financial instruments, our sensitivity analysis measures the potential loss in future earnings.

We had fixed-rate debt of $8.9 billion as of December 31, 2013, compared with $9.1 billion at December 31, 2012. The potential increase in the fair value of our fixed-rate interest-bearing financial instruments as a result of a 10 percent decrease in market interest rates would be approximately $0.3 billion at December 31, 2013, compared with an increase of approximately $0.4 billion at December 31, 2012.

We also had floating-rate investments and floating-rate debt of $13.7 billion and $3.4 billion, respectively, at December 31, 2013 compared to $12.0 billion and $3.5 billion, respectively, at December 31, 2012. The majority of our floating-rate debt is exposed to changes in LIBOR, with a 0.75 percent interest rate floor. Given the relationship of floating-rate investments to floating-rate debt as of December 31, 2013 and the current low interest rate environment, an increase or decrease in interest rates would not have a material impact on our consolidated financial position.

Counterparty Risk

We are exposed to counterparty risk as a result of our investment and derivatives contracts. Counterparty risk relates to the risk of loss which we would incur if a counterparty defaulted on an investment or derivatives contract. Our Treasury Department manages counterparty risk by establishing exposure limits for each counterparty based on credit ratings and financial position, and monitoring utilization against these limits. Counterparty limits and exposure utilization are periodically reviewed with our Treasurer. Substantially all of our counterparties are rated single-A or higher.

There have been no significant changes that would increase our exposure to financial market risks since December 31, 2013.

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BUSINESS

Chrysler Group Overview

Chrysler Group designs, engineers, manufactures, distributes and sells vehicles under the brand names Chrysler, Jeep, Dodge and Ram and the SRT performance vehicle designation. Our product lineup includes passenger cars, utility vehicles (including SUVs and crossover vehicles), minivans, trucks and commercial vans. We also sell automotive service parts and accessories under the Mopar brand name. In addition, we sell separately-priced service contracts to customers and provide contract manufacturing services to other vehicle manufacturers, primarily Fiat. As part of our industrial alliance with Fiat, or the Fiat-Chrysler Alliance, described below, we also manufacture certain Fiat-brand vehicles in Mexico, which are distributed by us throughout North America and certain select markets and sold to Fiat for distribution in other select markets, and Fiat manufactures certain Fiat-brand vehicles for us, which we sell throughout North America. Our products are available in more than 150 countries around the world. The majority of our operations, employees, independent dealers and sales are in North America, primarily in the U.S. Approximately 10 percent of our vehicle sales in 2013 were outside North America, principally in Asia Pacific, South America and Europe.

In June 2009, as part of the 363 Transaction described below, we entered into an alliance with Fiat pursuant to which Fiat became our principal industrial partner, and, as of January 21, 2014, Fiat now beneficially owns 100 percent of our membership interests. The Fiat-Chrysler Alliance provides us with a number of long-term benefits, including access to new vehicles, platforms and powertrain technologies, particularly with respect to smaller, more fuel-efficient vehicles, as well as commercial vehicles. The Fiat-Chrysler Alliance also allows us to streamline global distribution of both companies’ products, and to realize procurement benefits in light of our combined purchasing volume. See Risk Factors —Risks Relating to Our Business —We depend on the Fiat-Chrysler Alliance to provide new vehicle platforms and powertrain technologies, additional scale, global distribution and management resources that are critical to our viability and success and—Meeting our objective of increasing our vehicle sales outside North America is largely dependent upon access to Fiat’s network of distribution arrangements, manufacturing capacity and local alliance partners for a discussion of risks relating to the Fiat-Chrysler Alliance.

Formation of Chrysler Group

Chrysler Group is a Delaware limited liability company. It was formed on April 28, 2009 to complete the transactions contemplated by the master transaction agreement dated April 30, 2009, or the Master Transaction Agreement, under which Chrysler Group agreed to purchase the principal operating assets of Old Carco and its principal domestic subsidiaries, to assume certain of their liabilities, and to purchase the equity of Old Carco’s principal foreign subsidiaries. Old Carco and its principal domestic subsidiaries then filed for bankruptcy protection and sought approval under section 363 of the U.S. Bankruptcy Code for the transaction contemplated by the Master Transaction Agreement, which we refer to as the 363 Transaction. As part of a larger effort to stabilize the automotive industry and the U.S. and Canadian economies in 2009, the U.S. and Canadian governments indicated their willingness to fund the 363 Transaction and to provide working capital to fund our operations following the 363 Transaction. We closed the 363 Transaction on June 10, 2009, and entered into credit agreements with the United States Department of the Treasury, or U.S. Treasury, and with Export Development Canada.

As part of the 363 Transaction, we also entered into a master industrial agreement with Fiat, or Master Industrial Agreement, which has significantly accelerated our efforts to revitalize and reshape our product portfolio through the manufacture of fuel-efficient vehicles utilizing Fiat technology, and has helped us benefit from the managerial experience Fiat leaders gained during Fiat’s own industrial recovery. Refer toCertain Relationships and Related Party Transactions —Transactions with Fiat, for additional information related to our alliance with Fiat.

In connection with the closing of the 363 Transaction, we issued membership interests to the UAW Retiree Medical Benefits Trust, or the VEBA Trust, Fiat, U.S. Treasury, and Canada CH Investment Corporation, a 100 percent owned subsidiary of the Canada Development Investment Corporation, a Canadian federal Crown corporation, or Canadian

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Government, in exchange for capital contributions and in consideration of the transactions contemplated by the Master Transaction Agreement. The VEBA Trust was established to provide for postretirement health care benefits under an agreement with the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, or the UAW. We refer in this prospectus to the economic and voting rights associated with our membership interests as ownership interests. As a result of a series of transactions between 2011 and early 2014 that were contemplated in our governance documents and certain other agreements, Fiat now beneficially owns 100 percent of our membership interests. See—Recent Developments —Fiat Acquisition of Equity Interests held by the VEBA Trust.

Old Carco is treated as our predecessor for financial reporting purposes. For that reason, this prospectus includes financial information for Old Carco for periods prior to June 10, 2009.

Recent Developments

Fiat Acquisition of Equity Interests held by the VEBA Trust

On January 21, 2014, Fiat announced the completion of a transaction in which its 100 percent owned indirect subsidiary, FNA, indirectly acquired from the VEBA Trust all of the equity membership interests in Chrysler Group not previously held by FNA. In consideration for the sale of its membership interests in Chrysler Group, the VEBA Trust received $3,650 million consisting of:

• a special distribution paid from available cash on hand by Chrysler Group to its members, in an aggregate amount of $1,900 million (FNA directed its portion of the special distribution to the VEBA Trust as part of the purchase consideration); and

• $1,750 million paid by FNA.

As part of the transactions, FNA and the VEBA Trust have dismissed with prejudice all proceedings before the Delaware Court of Chancery with respect to the interpretation of a call option agreement which granted FNA the right to acquire certain of the membership interests in Chrysler Group held by the VEBA Trust. All of those membership interests were acquired by FNA in connection with the transactions described above.

Contemporaneously with the transactions described above, we and the UAW entered into a memorandum of understanding under our collective bargaining agreement in which the UAW made commitments to continue to support our industrial operations and the further implementation of the Fiat-Chrysler Alliance, including to use its best efforts to cooperate in the continued roll-out of our World Class Manufacturing, or WCM, programs, actively participate in benchmarking efforts associated with implementation of WCM programs across all Fiat-Chrysler manufacturing sites to ensure objective performance assessments and provide for proper application of WCM principles, and to actively assist in the achievement of our long-term business plan. In consideration of these commitments, we agreed to make payments to the VEBA Trust totaling $700 million to be paid in four equal annual installments. The initial payment of $175 million was made on January 21, 2014 and additional payments will be payable on each of the next three anniversaries of the initial payment. We funded the initial payment to the VEBA Trust from available cash on hand.

Concurrent with the closing of the transactions, Chrysler Group paid a distribution of approximately $60 million to its members in connection with such members’ tax obligations.

New Debt Issuances and Repayment of the VEBA Trust Note

On February 7, 2014, we and certain of our U.S. subsidiaries as guarantors entered into the following transactions to facilitate the repayment of the VEBA Trust Note, as defined below:

• New Senior Credit Facilities —a $250 million additional term loan under our existing Tranche B Term Loan facility, which matures on May 24, 2017, and a new $1,750 million term loan credit facility that matures on December 31, 2018;

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• Secured Senior Notes due 2019 —issuance of an additional $1,375 million aggregate principal amount of 8 percent secured senior notes due June 15, 2019, at an issue price of 108.25 percent of the aggregate principal amount; and

• Secured Senior Notes due 2021 —issuance of an additional $1,380 million aggregate principal amount of 8 ¹⁄₄ percent secured senior notes due June 15, 2021, at an issue price of 110.50 percent of the aggregate principal amount, which, together with the secured senior notes issuance above, we refer to as the old notes.

The proceeds of these transactions were used to repay all amounts outstanding, including accrued and unpaid interest, of approximately $5.0 billion under the senior unsecured note issued on June 10, 2009 to the VEBA Trust, or VEBA Trust Note, with an original face amount of $4,587 million.

Our 2010-2014 Business Plan

We have continued to progress against the business plan and related performance targets we announced on November 4, 2009 for the 2010 through 2014 period, or the 2010-2014 Business Plan. We have implemented a number of the initiatives highlighted in the 2010-2014 Business Plan that were designed to bring significant improvements to our business, including investing in our brands and new product development, leveraging the Fiat-Chrysler Alliance, improving supply chain management, optimizing our dealer network and building a workforce culture of high performance. Our business plan includes targets for vehicle sales and market share growth, profitability improvements and increased liquidity.

Specifically, we have focused on implementing the 2010-2014 Business Plan by:

• rejuvenating our product lineup with the launch of more than 25 new or significantly refreshed vehicles since we began operations in mid-2009, each of which possesses individualized characteristics that are more closely aligned with our newly refined brands. We characterize a vehicle as “new” if its platform is significantly different from the platform used in the prior model year and/or it has had a full exterior renewal. We characterize a vehicle as “significantly refreshed” if it continues its previous platform but has extensive changes or upgrades from the prior model;

• collaborating with Fiat on common vehicle platforms and technologies in order to produce desirable vehicles with improved quality and fuel economy at a lower overall cost, such as the Dodge Dart that we launched for retail sale in 2012 and the all-new 2014 Jeep Cherokee that launched in 2013;

• introducing innovative, industry-leading technology such as the all-new 9-speed transmission in our all-new 2014 Jeep Cherokee and an 8-speed transmission, which, when combined with our award-winning Pentastar V-6 engine, improves performance and affords best-in-class highway fuel economy for our new Ram 1500, Chrysler 300, Jeep Grand Cherokee, Dodge Durango and Dodge Charger;

• optimizing the global distribution of both Chrysler Group and Fiat vehicles by transitioning our sales and distribution operations within Europe to Fiat, by taking the final steps to rationalize our U.S. dealer network, and by initiating other opportunities to combine aspects of our respective sales channels;

• systemizing and improving our procurement, manufacturing, quality and supply chain functions; and

• continuing to refine our management organization to speed decision-making and to capitalize on the benefits of the Fiat-Chrysler Alliance.

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In addition, we have improved the availability of competitive financing sources to our dealers and retail customers. We began on that path when we partnered with Ally in 2009, and expanded and improved upon our offerings to dealers and consumers beginning in May 2013, with the launch of the SCUSA Agreement with SCUSA, which provides a wide range of wholesale and retail financing services to our dealers and consumers under the Chrysler Capital brand name. We will also maintain the supplemental sources of financing we have established with other providers. The results of these and other actions taken in connection with the 2010-2014 Business Plan are described more fully under—Distribution —Dealer and Customer Financing below.

Fiat-Chrysler Alliance

Fiat is the parent company of one of Italy’s largest industrial groups and one of the early founders of the European automotive industry.It is a publicly traded company, the shares of which are listed on the Borsa Italiana and several other European stock exchanges. Fiat has historically operated a wide range of businesses in the automotive, industrial and finance sectors. Following a corporate demerger transaction that became effective on January 1, 2011, Fiat’s primary business is the design, engineering, manufacture and sale of automobiles, automobile-related components and production systems through its subsidiaries, including Fiat Group Automobiles, Ferrari, Maserati, Magneti Marelli, Teksid and Comau. Fiat vehicles are sold primarily in Europe and South America, particularly in Brazil.

Under the Master Industrial Agreement and related ancillary agreements, Chrysler Group and Fiat formed the Fiat-Chrysler Alliance under which the parties are collaborating on a number of fronts, including product and platform sharing and development, global distribution, procurement, information technology infrastructure, management services and process improvement. Collaborative initiatives between us and Fiat include:

• Product and Platform Sharing —We are benefiting from Fiat’s vehicle architectures and expertise to develop products that compete in mini, small, compact and mid-sized (A-, B-, C- and D-segment) vehicle markets, as well as commercial vans, while Fiat is using our vehicle architectures and expertise to develop products that compete in the mid to large-size (D- and E-segment) vehicle markets. Similarly, we are co-developing and sharing platforms with Fiat to save on the cost of development and parts, to improve our quality and time to market, and to simplify our manufacturing processes. In 2012, we launched the Dodge Dart, the first vehicle based upon the CUSW platform we co-developed with Fiat. We intend to use the Small Wide and CUSW platforms on almost all of our future B-, C- and D-segment vehicles.

• Shared Technology —Through the Fiat-Chrysler Alliance, we have introduced certain Fiat automotive technologies into our products, such as Fiat’s Fully-Integrated Robotised Engine, or FIRE engine, that incorporates Fiat’s fuel-saving MultiAir technology. Such access has permitted us to save on the significant investment of capital and time to develop such technology on our own, and minimizes the risk that the newly-implemented technology may not be effective. In September 2013, we launched a version of the Dodge Dart that incorporates the next generation Fiat technology, MultiAir II. In October 2013, we began shipping the Jeep Grand Cherokee powered by Fiat’s 3.0L V-6 EcoDiesel engine. In February 2014, we began shipping this same EcoDiesel engine in the Ram 1500. Fiat has the opportunity to use our Pentastar V-6 engine for its larger vehicles.

• Global Distribution —We have broadened our opportunities to sell vehicles and service parts outside of North America through Fiat’s longstanding presence and established distribution networks in Europe and South America. At the same time, our extensive manufacturing, distribution, and logistics capabilities in North America are providing us the opportunity to generate additional revenues as a distributor and contract manufacturer for Fiat and a distributor of Alfa Romeo brand vehicles and service parts in Mexico. We also purchase vehicles contract manufactured by Fiat in Europe for sale in North America.

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• Procurement —We have established joint purchasing programs with Fiat that are designed to yield short- and long-term savings and efficiencies, primarily through negotiations with common suppliers, as well as the use of shared parts and components and leveraging volume bundling opportunities which we expect will also help reduce waste, enhance productivity and reduce cost to us.

• World Class Manufacturing (WCM) —We have introduced Fiat’s WCM into all of our assembly, powertrain and stamping facilities. WCM targets the elimination of waste of all types, and ultimately enhances worker efficiency, productivity, safety and vehicle quality. In 2012, four of our manufacturing facilities received Bronze-level WCM certification, and in 2013 we began to introduce WCM principles in our suppliers’ operations.

• Information and Communication Technology —We are continuing to align our information and communication technology systems and related business processes with Fiat’s systems and processes throughout our industrial, commercial and corporate administrative functions in order to facilitate our collaboration with Fiat, and to support our drive toward common global systems. As part of this alignment, we are adopting and implementing upgraded engineering software tools, as well as finance and procurement systems currently in use at Fiat, which we believe mitigates some of the risks typically encountered in implementing new information technology systems.

These initiatives, which build upon the parties’ respective strengths, are conducted pursuant to various commercial arrangements we have with Fiat, described below in more detail underManagement’s Discussion and Analysis of Financial Condition and Results of Operations andCertain Relationships and Related Party Transactions —Transactions with Fiat.

There is little, if any, competitive product overlap between us and Fiat. Although we and Fiat are sharing certain products and platforms as described above, we are minimizing competitive overlap in those markets in which we are both active through product and brand differentiation; for example, through different styling, powertrain configurations, accessories and marketing themes, as well as by targeting different consumer segments and vehicle price points.

Our Chief Executive Officer, Chief Financial Officer and certain of our other executive officers and employees serve on the Group Executive Council, or GEC, formed to oversee the management and integration of all Fiat interests, including its interest in Chrysler Group. Although the GEC cannot contractually bind Chrysler Group and recommendations made by the GEC to Chrysler Group, including transactions with Fiat affiliates, are subject to our own internal review and approval procedures, we believe that this facilitates the Fiat-Chrysler Alliance partners’ ability to coordinate their respective product and brand development plans and utilize their respective manufacturing capacity and capital resources more efficiently.

In January 2014, Fiat indirectly acquired, through its 100 percent owned indirect subsidiary, FNA, the 41.5 percent remaining membership interests held by the VEBA Trust described above in —Recent Developments —Fiat Acquisition of Equity Interests held by the VEBA Trust. Our governance documents include provisions that, following that transaction, effectively grant Fiat full control over our governance structure, including the election of our entire Board of Directors, or the Board.In addition, our Chief Executive Officer and Chief Financial Officer serve in those same roles for Fiat.

Products

A key component of our strategic plan is to create a portfolio of products that will appeal to a wide range of consumers. In order to optimize the mix of products we design, manufacture and sell, we consider a number of factors, including:

• consumer tastes, trends and preferences;

• demographic trends, such as age of population and rate of family formation;

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• economic factors that affect preferences for luxury, affordability and fuel efficiency;

• competitive environment, in terms of quantity and quality of competitors’ vehicles offered within a particular segment;

• our brand portfolio, as each of our brands targets a different group of consumers;

• consumer preferences for certain vehicle types based on geographic region; and

• technology, manufacturing capacity, regulatory requirements and other factors that impact our product development.

We also consider these factors in developing a mix of vehicles within each brand, with an additional focus on ensuring that the vehicles we develop further enhance our brand strategy.

As we acknowledged in our 2010-2014 Business Plan, our success rests largely on better balancing our portfolio to appeal to a broader, more global audience. We took significant steps to address our offerings in 2010 and 2011, when, over an 18-month period, we successfully re-designed and launched 16 vehicles with improved content and performance at a greater value. Among those launches was the new and widely acclaimed Jeep Grand Cherokee, which we then leveraged to develop and launch the three-row Dodge Durango to better accommodate families. We also expanded our reach to include smaller vehicles with the manufacture and sale of the Fiat 500.

In 2012, we continued to augment our smaller vehicle offerings with the launch of a new C-sedan, the Dodge Dart. The Dodge Dart is the first vehicle to utilize the CUSW platform that we co-developed with Fiat. The Dart also incorporates several Fiat and Chrysler Group fuel-saving technologies. See —Research, Development and Intellectual Property below. Also in 2012, we launched the significantly refreshed Ram 1500 pick-up truck, the most fuel-efficient truck in its class, featuring an 8-speed transmission and our newly launched telematics system. The new Ram 1500 received the 2013Motor Trend “Truck of the Year” designation and was selected as the North American International Auto Show 2013 “Truck/Utility of the Year.” We broadened the reach of the Fiat brand in North America with the launch of an Abarth version of the Fiat 500, as well as the production launch of a fully electrified version of the Fiat 500, driven by a powertrain based on our electrification technology. Finally, we re-opened our Conner Avenue assembly plant in Detroit, Michigan to begin production of the all-new SRT Viper.

In 2013, we continued to expand our lineup and refresh existing models. We launched a mid-cycle upgrade of the new Jeep Grand Cherokee and our heavy-duty Ram trucks in the first quarter. The Jeep Grand Cherokee upgrade included adaptation of the all-new 8-speed automatic transmission and Uconnect Access. The heavy-duty Ram had major improvements to the chassis to enhance towing and load capability along with the upgraded interior shared with the light-duty Ram.

In October 2013, we began shipping the all-new 2014 Jeep Cherokee based on the jointly-developed CUSW platform and featuring an all-new 9-speed transmission. Further expanding the breadth of our product portfolio, we began production of the all-new ProMaster commercial van as part of our Ram lineup in July 2013. The van, based upon the Fiat Ducato, is being built in our new plant in Saltillo, Mexico. We also introduced the all-new Fiat 500L, a B-segment multi-purpose vehicle that is contract manufactured for us by Fiat. By the end of 2014, we expect that a substantial portion of our lineup will consist of vehicles based on new vehicle platforms, many of which will be jointly-developed platforms.

Partnering with Fiat, we began shipping the Jeep Grand Cherokee powered by Fiat’s 3.0L V-6 EcoDiesel engine in October 2013. We also began shipping this same EcoDiesel engine in the Ram 1500 in February 2014 in North America. In December 2013, the Ram 1500 received theMotor Trend “Truck of the Year” for the second consecutive year.

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In addition, Fiat is selling a version of our Dodge Journey as a Fiat Freemont in several markets outside North America. In 2014, we expect to establish an arrangement with Fiat to build a Jeep vehicle in China to be sold only in China. SeeRisk Factors —Risks Relating to Our Business —Meeting our objective of increasing our vehicle sales outside North America is largely dependent upon access to Fiat’s network of distribution arrangements, manufacturing capacity and local alliance partners.

Brands

We believe that we can continue to increase our vehicle sales, and reduce our reliance on sales incentives to dealers and retail consumers, by building the value of our Chrysler, Jeep, Dodge and Ram brands, as well as the SRT performance vehicle designation, all of which have a strong heritage and wide recognition among consumers. We also continue to build momentum in North America with respect to the Fiat brand, which enjoys similar recognition in other parts of the world.

Continuing our multi-year campaigns to clearly define the identity of each brand, we have launched several advertising campaigns that have received industry accolades. These campaigns supported the introduction of several new or significantly refreshed vehicles with individualized characteristics that are more closely aligned with the unique identity of each brand. In 2013, the Dodge brand teamed with Paramount Pictures to launch the successful Ron Burgundy marketing campaign for the new 2014 Dodge Durango. Further, we strengthened the global footprint of the Jeep brand in 2013 through concerted advertising and marketing campaigns which included many high-profile sponsorships. Jeep worldwide sales set an all-time record in 2013 of approximately 732,000 vehicles, with significant growth outside of North America. In addition, we developed a significant campaign to support the launch of the all-new 2014 Jeep Cherokee. We also launched campaigns to emphasize the historical ties of the Jeep brand to the U.S. military and the long-standing relationship between the Ram brand and the American farming community as demonstrated by the Ram brand’s ties with the Future Farmers of America Organization.

Mopar

We sell Mopar-branded accessories and collision, repair, maintenance and performance parts for our vehicles primarily to our dealers and distributors.Through our dealer network, we also sell Mopar service contracts to retail consumers for extended vehicle maintenance and repair. We currently offer Mopar service contracts throughout North America, the Middle East, Southeast Asia, East Asia, South Africa and Australia. We are currently in the process of expanding our service contracts business throughout the world, for ourselves and for Fiat, under the Mopar Vehicle Protection name. We believe that our customers’ future vehicle buying decisions are significantly influenced by their experience with after-sale service, replacement parts and accessories.We market Mopar as a standalone brand to increase the use of our products by, and improve the experience of, car enthusiasts and service providers who purchase replacement service parts and vehicle accessories. In 2013, we have continued to broaden our traditional marketing of Mopar at a global level via special event sponsorships, branded accessories, special edition vehicles, and a more extensive use of digital and social media. As of December 31, 2013, Mopar had received over half a million Facebook likes and had a registered owner base of more than 700,000 active users on the Mopar.com owner site. We are continuously improving the capabilities of Mopar.com, which offers online shopping for Mopar service parts and accessories. In 2013, we experienced a 27 percent increase in unique visitors to the site over 2012.

Together with Fiat, we continue to employ Mopar’s operational capabilities on a global basis to ensure the coordinated development and sale of common parts, diagnostic equipment and service tools. Mopar currently oversees 50 parts distribution centers which support both Chrysler Group and Fiat operations, 20 of which are located in North America. As our utilization of common platforms and sales of shared vehicles grows, we expect Fiat to continue to leverage the Mopar brand to support its operations.

In the U.S., we have continued to build upon our initiative to improve our customer care experience at our dealers and to enhance revenue opportunities. In 2010, we asked our U.S. dealers to extend their service hours to

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include Saturday and evening hours, and to market express oil change or other quick services using Mopar supplies. Approximately 80 percent of our U.S. dealers now offer Saturday service hours, and more than 40 percent provide an “express lane” or other quick service program. Dealers in our network have also hired several thousand additional technicians and service advisors to support the vehicle maintenance and repair services of our dealers and other aftermarket service providers. Finally, in 2012, we launched the wiADVISOR, a tablet-based service reception tool for our dealers. To date, approximately 1,300 dealers in our U.S. network have agreed to adopt this technology in their service centers.

Vehicle Sales

The U.S. economy continues to gradually recover from the recession that began in late 2007 and became increasingly severe with the global credit crisis in 2008 and 2009. The weaker economic conditions led to a substantial industry-wide decline in vehicle sales in the U.S., which fell from 16.5 million vehicles in 2007 to 10.6 million vehicles in 2009. The impact of this downturn on our market share was particularly pronounced and sustained, partly as a result of constraints on Old Carco’s ability to make investments in the development of new or significantly refreshed vehicles. In addition, Old Carco’s vehicle sales were adversely affected by increased fuel prices beginning in 2008 due to the predominance of larger, less fuel-efficient vehicles in its product portfolio.

Subsequent to the 363 Transaction, we have taken a number of product development and improvement actions, as described under the captions —Products, above, and —Research, Development and Intellectual Property below.

Our new vehicle sales represent sales of our vehicles from dealers and distributors to retail customers and fleet customers. Our vehicle sales also include the Fiat 500L, which Fiat began contract manufacturing for us in May 2013 for sale in North America. Sales of the Fiat 500L represent less than one percent of our total vehicle sales for the year ended December 31, 2013. Beginning January 1, 2013, Chrysler Group vehicle sales in Mexico include Fiat-manufactured Fiat and Alfa Romeo vehicles. Prior to January 1, 2013, these vehicle sales were reported by Fiat (approximately five thousand vehicles for the year ended December 31, 2012). Vehicles manufactured by Chrysler Group for other companies, including Fiat, are excluded from our new vehicle sales. The following summarizes our new vehicle sales by geographic market for the years presented.

	Years Ended December 31,
	2013 (1)(2)						2012 (1)(2)						2011 (1)(2)						2010 (1)(2)						2009 (1)(2)(3)
	Chrysler Group		Industry		Percentage of Industry (4)		Chrysler Group		Industry		Percentage of Industry (4)		Chrysler Group		Industry		Percentage of Industry (4)		Chrysler Group		Industry		Percentage of Industry (4)		Chrysler Group and Old Carco		Industry		Percentage of Industry (4)
	(vehicles in thousands)
U. S.		1,800		15,862		11.4%		1,652		14,786		11.2%		1,369		13,041		10.5%		1,085		11,770		9.2%		931		10,603		8.8%
Canada		260		1,777		14.6%		244		1,714		14.2%		231		1,618		14.3%		205		1,581		13.0%		163		1,481		11.0%
Mexico		87		1,101		7.9%		88		1,024		8.6%		82		937		8.8%		79		846		9.3%		83		776		10.6%
Total North America		2,147		18,740		11.5%		1,984		17,524		11.3%		1,682		15,596		10.8%		1,369		14,197		9.6%		1,177		12,860		9.2%
Rest of World		254		63,621		<1.0%		210		62,449		<1.0%		173		60,018		<1.0%		147		57,697		<1.0%		141		51,044		<1.0%
Total Worldwide		2,401		82,361		2.9%		2,194		79,973		2.7%		1,855		75,614		2.5%		1,516		71,894		2.1%		1,318		63,904		2.1%

(1) Certain fleet sales that are accounted for as operating leases are included in vehicle sales.

(2) The Company’s estimated industry and market share data presented are based on management’s estimates of industry sales data, which use certain data provided by third-party sources, including IHS Global Insight and Ward’s Automotive.

(3) For 2009, we have combined the vehicles sales of Old Carco and Chrysler Group. Vehicle sales in the U.S. were 426 thousand from January 1, 2009 to June 9, 2009 and 505 thousand from June 10, 2009 to December 31, 2009. Vehicle sales in Canada were 71 thousand from January 1, 2009 to June 9, 2009 and 92 thousand from June 10, 2009 to December 31, 2009. Vehicle sales in Mexico were 34 thousand from January 1, 2009 to June 9, 2009 and 49 thousand from June 10, 2009 to December 31, 2009. The balance of the international sales was 62 thousand from January 1, 2009 to June 9, 2009 and 79 thousand from June 10, 2009 to December 31, 2009.

(4) Percentages are calculated based on the unrounded vehicle sales volume for Chrysler Group, Old Carco and the industry.

See Note 20,Geographic Information, of our accompanying audited consolidated financial statements for information about our net revenues and long-lived assets by geographic area.

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The following summarizes the total U.S. industry sales of new motor vehicles of domestic and foreign models and our relative competitive position for the years presented. Vehicles manufactured by Chrysler Group for other companies, including Fiat, are excluded from our new vehicle sales.

	Years Ended December 31,
	2013 (1)(2)						2012 (1)(2)						2011 (1)(2)						2010 (1)(2)						2009 (1)(2)(3)
	Chrysler Group		Industry		Percentage of Industry (4)		Chrysler Group		Industry (5)		Percentage of Industry (4)		Chrysler Group		Industry (5)		Percentage of Industry (4)		Chrysler Group		Industry (5)		Percentage of Industry (4)		Chrysler Group and Old Carco		Industry (5)		Percentage of Industry (4)
	(vehicles in thousands)
Cars
Small		119		2,962		4.0%		80		2,809		2.8%		55		2,278		2.4%		45		2,011		2.2%		36		1,998		1.8%
Mid-size		211		2,846		7.4%		210		2,725		7.7%		143		2,272		6.3%		82		2,082		4.0%		61		1,961		3.1%
Full-size		156		922		16.9%		153		878		17.5%		106		850		12.5%		113		893		12.6%		99		808		12.3%
Sport		58		618		9.3%		55		627		8.8%		50		539		9.3%		44		532		8.3%		32		545		5.9%
Total Cars		544		7,348		7.4%		498		7,039		7.1%		354		5,939		6.0%		284		5,518		5.2%		228		5,312		4.3%
Minivans		246		518		47.5%		253		540		46.9%		206		472		43.4%		216		460		46.9%		175		415		42.2%
Utility Vehicles		642		5,221		12.3%		600		4,671		12.8%		552		4,280		12.9%		372		3,753		9.9%		333		3,121		10.7%
Pick-up Trucks		338		2,109		16.0%		278		1,888		14.7%		244		1,774		13.8%		207		1,602		12.9%		184		1,383		13.3%
Van & Medium- Duty Trucks		30		666		4.4%		23		648		3.6%		13		576		2.3%		6		437		1.3%		11		372		3.1%
Total Vehicles		1,800		15,862		11.4%		1,652		14,786		11.2%		1,369		13,041		10.5%		1,085		11,770		9.2%		931		10,603		8.8%

(1) Certain fleet sales that are accounted for as operating leases are included in vehicle sales.

(2) The Company’s estimated industry and market share data presented are based on management’s estimates of industry sales data, which use certain data provided by third-party sources, including IHS Global Insight and Ward’s Automotive.

(3) For 2009, we have combined the vehicle sales of Old Carco and Chrysler Group.

(4) Percentages are calculated based on the unrounded vehicle sales volumes for Chrysler Group, Old Carco and the industry.

(5) During 2013, certain industry segment classifications were modified. We have reclassified all prior periods presented to conform to the 2013 classifications.

Fleet Sales and Deliveries

Our vehicle sales and market share data presented above includes fleet sales, as well as sales by our dealers to retail customers.Fleet sales consist of sales to rental car companies, commercial fleet customers and government entities.

The following summarizes our U.S. fleet sales and the number of those sales as a percentage of our total annual U.S. vehicle sales:

	Years Ended December 31,
	2013 (1)		2012 (1)		2011  (1)		2010 (1)		2009 (1)(2)
	(vehicles in thousands)
Rental Car Companies		305		324		295		317		171
Other Fleet Customers		99		105		83		75		70
Total U.S. Fleet		404		429		378		392		241
Percentage of Total U.S. Vehicle Sales(3)		22.4%		26.0%		27.6%		36.1%		25.9%

(1) Certain fleet sales that are accounted for as operating leases are included in vehicle sales.

(2) Chrysler Group began operations on June 10, 2009. The data reflects combined fleet sales of Old Carco and Chrysler Group for 2009.

(3) Percentages are calculated based on the unrounded vehicle sales volume for Chrysler Group and Old Carco.

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We categorize our fleet sales into three primary channels: (i) daily rental, (ii) commercial and (iii) government, including local, state and federal governments. Of the three channels, vehicle sales to our commercial customers are typically more profitable since they involve customized vehicles with more optional features and Mopar accessories; however, vehicle orders in this channel are usually smaller in size than the orders made in the daily rental channel. Vehicle sales in the daily rental and government channels are extremely competitive and often require discounts in order to be competitive. Fleet sales in the government channel are more profitable for us than fleet sales in the daily rental channel primarily due to the mix of products included in each respective channel. Rental car companies, for instance, place larger orders of small and mid-sized cars and minivans with minimal options, while sales in the government channel often involve a higher mix of relatively more profitable vehicles such as pick-up trucks, minivans and large cars with more options.

Although our vehicle sales to dealers for sale to retail customers are normally more profitable than our fleet sales, our fleet sales are an important source of revenue and can also be an effective means for marketing our vehicles. Further, fleet orders also help normalize our plant production because they typically involve the delivery of a large, pre-determined quantity of vehicles over several months. Fleet sales are also a source of aftermarket service parts revenue for us and service revenue for our dealers.

Competitive Position

The automotive industry is highly competitive, especially in the U.S., our primary market, with more than 10 large manufacturers with significant market share. Vehicle manufacturers must continuously engineer improvements in vehicle design, technology, performance and content to meet consumer demands for quality, reliability, fuel efficiency, comfort, driving experience, style, and safety. To enhance our competitive position, we are renewing our existing product lineup and introducing smaller, more fuel-efficient vehicles to balance our product lineup, which has been traditionally more weighted toward utility vehicles, minivans, trucks and large sedans.

Historically, U.S. manufacturers relied heavily upon dealer, retail and fleet incentives, including cash rebates, option package discounts, guaranteed depreciation programs, and subsidized or subvented financing or leasing programs to compete for vehicle sales. Although we will continue to use such incentives to market particular models in particular geographic regions during specific time periods, we now focus more of our efforts on improving vehicle sales primarily by building brand value, balancing our product portfolio, and improving the content, quality and performance of our vehicles. See —Products and —Brands, above, for information about our initiatives in those areas andManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Trends, Uncertainties and Opportunities —Pricingfor additional information related to incentives.

Our ability to increase or maintain vehicle prices and reduce reliance on incentives is limited by intense price competition resulting from the wide variety of available competitive vehicles in each segment of the new car market and global overcapacity in the automotive industry. At the same time, we will not be able to gain a competitive advantage by lowering prices as a means to increase vehicle sales without adversely affecting our profitability, as our ability to reduce costs is limited by commodity market prices, contract terms with suppliers, evolving regulatory requirements and collective bargaining agreements that limit our ability to reduce labor expenses in the short term.

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The following provides new vehicle U.S. market share information for Chrysler Group and its principal competitors:

	Years Ended December 31, (1)
	2013		2012		2011		2010		2009
Chrysler Group (2)		11.4%		11.2%		10.5%		9.2%		8.8%
GM		17.6%		17.6%		19.2%		18.8%		19.6%
Ford		15.7%		15.2%		16.5%		16.4%		15.3%
Toyota		14.1%		14.1%		12.6%		15.0%		16.7%
Honda		9.6%		9.6%		8.8%		10.5%		10.9%
Hyundai/Kia		7.9%		8.6%		8.7%		7.6%		6.9%
Nissan		7.9%		7.7%		8.0%		7.7%		7.3%
Other		15.8%		16.0%		15.7%		14.8%		14.5%
Total		100.0%		100.0%		100.0%		100.0%		100.0%

(1) The Company’s estimated market share data is presented based on management’s estimates of industry sales data, which use certain data provided by third-party sources, including IHS Global Insight and Ward’s Automotive.

(2) Chrysler Group began operations on June 10, 2009. The data reflects combined market share of Old Carco and Chrysler Group for 2009.

Distribution

Our products are available in more than 150 countries around the world. We sell our products to dealers and distributors for sale to retail customers and fleet customers. Sales of vehicles, service parts and accessories outside North America are primarily to 100 percent owned, or affiliated, national sales companies or independent distributors and dealers.

In June 2011, Fiat became the general distributor of our vehicles and service parts in Europe, selling our products through a network of newly appointed dealers. Fiat is also distributing one of our vehicles through its well-established network in Brazil.

The following summarizes the number of independent dealer entities in our dealer network:

	As of December 31,
	2013		2012		2011		2010		2009
U.S. (1)		2,604		2,570		2,474		2,311		2,352
Canada(2)		437		437		434		433		434
Mexico (3)		163		149		136		132		115
Rest of World (4)		891		883		773		1,411		1,532
Total Worldwide		4,095		4,039		3,817		4,287		4,433

(1) The number of dealers in the U.S. as of December 31, 2013, 2012 and 2011 includes 214, 200 and 138, respectively, Fiat brand dealers, of which 179, 175 and 123, respectively, were also Chrysler, Jeep, Dodge and Ram brand dealers.

(2) The number of dealers in Canada as of December 31, 2013, 2012 and 2011 includes 82, 77 and 62, respectively, Fiat brand dealers, of which 81, 76 and 62, respectively, were also Chrysler, Jeep, Dodge and Ram brand dealers.

(3) The number of dealers in Mexico as of December 31, 2013, 2012, 2011 and 2010 includes 44, 31, 22 and 21 Fiat brand dealers, respectively, and 9, 8, 3 and zero Alfa Romeo brand dealers, respectively.

(4) The increase in the number of Rest of World dealers in 2012 as compared to 2011 is primarily attributable to our continuing efforts to engage in emerging market opportunities, particularly in Asia Pacific and South America. The decrease in the number of Rest of World dealers in 2011 as compared to 2010 is primarily attributable to our appointment in June 2011 of Fiat as our general distributor for select countries in Europe.

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We are the exclusive distributor of Fiat and Fiat Professional (light commercial) vehicles and service parts in Mexico, and we are also the exclusive distributor of Fiat brand vehicles and service parts in North America. In 2010, we began selecting dealers for the sale of Fiat brand vehicles and service parts in the U.S. and Canada. We chose the metropolitan areas for these dealers based on small-car registration levels and the anticipated growth in the local small-car market. As of December 31, 2013, we had 214 independent Fiat dealerships in the U.S., of which 179 are owned by our Chrysler, Jeep, Dodge and Ram dealers. We also reintroduced Alfa Romeo brand vehicles and service parts in Mexico in 2011, and expect to sell Alfa Romeo brand vehicles in the U.S. and Canada as well.

In January 2012, we began distributing vehicles and service parts for Fiat in Russia. In addition, we are continuing to work with Fiat to engage in additional opportunities for the production, distribution and sales of vehicles and service parts in other emerging markets, such as China, Brazil and India. See—Fiat-Chrysler Alliance —Global Distribution, above, for additional information.In 2012, we also began selling Fiat, Fiat Professional and Alfa Romeo vehicles and/or service parts for Fiat in other markets outside North America.

Dealer and Customer Financing

Because our dealers and retail customers finance the purchase of a significant percentage of the vehicles we sell, the availability and cost of financing is one of the most significant factors affecting our vehicle sales volumes. Dealers use wholesale financing arrangements to purchase vehicles from us to maintain vehicle inventory levels adequate to drive retail vehicle sales. Retail customers use a variety of financing and lease programs, including programs in which we offer financial subsidy incentives, capitalized cost reductions or special terms through a financial services company, to acquire new vehicles from our dealers. Historically, like most large automakers, Old Carco relied on an affiliated finance company to provide most of this financing. Following the 363 Transaction, we do not have a captive finance company and instead rely upon strategic relationships developed with independent financial service providers, primarily SCUSA and formerly Ally, to provide critical financing and support for our dealers and retail customers, as described below.

On February 6, 2013, we entered into the SCUSA Agreement. Under the SCUSA Agreement, SCUSA provides a wide range of wholesale and retail financing services to our dealers and retail customers in accordance with its usual and customary lending standards, under the Chrysler Capital brand name. The financing services include credit lines to finance our dealers’ acquisition of vehicles and other products that we sell or distribute, retail loans and leases to finance retail customer acquisitions of new and used vehicles at our dealerships, financing for commercial and fleet customers, and ancillary services. In addition, SCUSA will work with dealers to offer them construction loans, real estate loans, working capital loans and revolving lines of credit.

The new financing service launched on May 1, 2013 following the expiration of our prior agreement with Ally discussed below, and SCUSA has agreed to specific transition milestones for the initial year following launch. If the transition milestones are met, or otherwise satisfactory to us, the SCUSA Agreement will have a ten-year term, subject to early termination in certain circumstances, including the failure by a party to comply with certain of its ongoing obligations under the SCUSA Agreement. In accordance with the terms of the agreement, SCUSA provided us an upfront, nonrefundable payment in May 2013, which will be amortized over ten years.

Under the SCUSA Agreement, we have provided SCUSA with certain rights, including limited exclusivity to participate in specified minimum percentages of certain of our retail financing rate subvention programs. SCUSA’s exclusivity rights are subject to SCUSA maintaining price competitiveness based on market benchmark rates to be determined through a steering committee process as well as minimum approval rates.

SCUSA has agreed to make certain revenue sharing arrangements. The SCUSA Agreement also includes several commitments from SCUSA with respect to available funding, approval and penetration rates, price competitiveness and certain exclusivity rights. SCUSA will bear the risk of loss on loans contemplated by the SCUSA Agreement and the parties will share in any residual gains and losses in respect of consumer leases,

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subject to specific provisions including limitations on our participation in gains and losses contained in the SCUSA Agreement. SCUSA has also committed to consider future revenue sharing opportunities.

As part of the SCUSA relationship, we may in the future acquire an equity participation in an operating entity that would be formed to continue to provide the financing services contemplated by the SCUSA Agreement. The cost of our investment would be determined based on the operations that both parties agree would be contributed to the new operating entity and the resulting value.

Prior to entering into the SCUSA Agreement, in connection with the 2009 restructuring of the U.S. automotive industry, and with the assistance of the U.S. Treasury, we entered into an auto finance relationship with Ally. Ally provided wholesale and retail financing to our dealers and retail customers in the U.S. and Canada pursuant to the terms of the Auto Finance Operating Agreement that we signed with Ally in August 2010, or the Ally Agreement. We did not have an exclusive arrangement with Ally, as Ally had a similar agreement with General Motors and provides wholesale and retail financing to support other vehicle manufacturers.

Pursuant to the Ally Agreement, Ally was required to consider applications for financing made by our dealers and retail customers in accordance with its usual and customary standards, and to make lending decisions in accordance with its business judgment. As a customer incentive, we subsidized interest rates or cash payments at the inception of a financing arrangement, a practice known as “subvention.” Ally provided consumer and dealer financing to other manufacturers and our dealers and retail customers obtained financing, including some subvented financing, from other financing sources. Under the agreement, however, we first had to offer all subvention programs to Ally, and we were required to ensure that Ally financed a specified minimum percentage of the vehicles we sold in North America under rate subvention programs in which it elected to participate. Under the Ally Agreement, we were required to repurchase Ally-financed dealer inventory upon certain triggering events and with certain exceptions, in the event of an actual or constructive termination of a dealer’s franchise agreement, including, in certain circumstances, when Ally foreclosed on all assets of a dealer securing financing provided by Ally. These obligations excluded vehicles that had been damaged or altered, that were missing equipment or that had excessive mileage or an original invoice date that was more than one year prior to the repurchase date. As of December 31, 2013, the maximum potential amount of future payments required to be made to Ally under this guarantee was approximately $230 million, and was based on the aggregate repurchase value of eligible vehicles financed by Ally in our U.S. dealer stock. If vehicles are required to be repurchased under this arrangement, the total exposure would be reduced to the extent the vehicles can be resold to another dealer. The fair value of the guarantee was less than $0.1 million as of December 31, 2013, which considers both the likelihood that the triggering events will occur and the estimated payments that would be made net of the estimated value of inventory that would be reacquired upon the occurrence of such events. These estimates are based on historical experience.

On February 1, 2013, the Canadian automotive finance business of Ally was acquired by the Royal Bank of Canada, or RBC. Dealers with financing through Ally were offered new lending agreements with RBC, as the Ally-financing arrangements did not transfer with the sale. As such, we no longer have an obligation to repurchase dealer inventory in Canada that was acquired prior to February 1, 2013 and was financed by Ally.

In an effort to expand the financing options for U.S. retail customers, in 2010, we also entered into subvention agreements with SCUSA for loans to sub-prime retail customers, and with US Bank, N.A. for lease financing. In 2011, we entered into an additional subvention agreement with Chase Bank, N.A. These supplemental programs are important sources of financing for some of our retail customers. Additionally, Chrysler Canada and Chrysler de Mexico have arrangements with a number of financial institutions to provide a variety of retail financing programs.

In April 2012, we notified Ally that we would not renew the Ally Agreement following expiration of its initial term on April 30, 2013. This notice was given in light of the Ally Agreement’s requirement of 12 months’ prior notice. Notwithstanding the termination of the Ally Agreement, we anticipate that Ally will continue as a source

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of funding for our dealers and retail customers given the relationships Ally has developed since the time of the 363 Transaction. The Ally Agreement was terminated on April 30, 2013. Further, in September 2013, Ally sued SCUSA alleging breaches of copyright and misappropriation of trade secrets in connection with SCUSA’s entry into the arrangement with us and provision of financing solutions to our dealers and retail customers. This litigation is pending in federal court.

As of December 31, 2013, Ally was providing wholesale lines of credit to approximately 43 percent of our dealers in the U.S. For the year ended December 31, 2013, we estimate that approximately 81 percent of the vehicles purchased by our U.S. retail customers were financed or leased through our dealer network, of which approximately 22 percent were financed or leased through subvented programs with Ally and other lenders. As of December 31, 2013, SCUSA was providing wholesale lines of credit to approximately three percent of our dealers in the U.S. Ally has continued to provide dealer financing since the termination of our relationship with them, though they are no longer obligated to provide such financing. SeeRisk Factors —Risks Relating to Our Business —Availability of adequate financing on competitive terms for our dealers and consumers is critical to our success. Our lack of a captive finance company could place us at a competitive disadvantage to other automakers that may be able to offer consumers and dealers financing and leasing on better terms than our customers and dealers are able to obtain. In lieu of a captive finance company, we will depend on our relationship with SCUSA to supply a significant percentage of this financing, and we continue to depend on our former partner, Ally, as we transition to the new SCUSA relationship.

Finally, as part of the Fiat-Chrysler Alliance, we have agreements with financial services affiliates of Fiat for the provision of financing to consumers and our dealers in China, Argentina and Brazil.

Research, Development and Intellectual Property

We engage in research and development for new vehicles and technology to improve the performance, safety, fuel efficiency, reliability and consumer perception of our vehicles and to develop new features and content to meet customer expectations. As of December 31, 2013, we employed over 6,000 engineers. Our engineers support our product development efforts and have expertise in a number of disciplines, including mechanical, electrical, materials, computer science and chemical engineering. We also provide several internal programs through which a portion of our engineers receive cross-training in various technical and business functions.

We typically conduct consumer research during the early stages of new product development initiatives in order to identify key features and vehicle attributes desired by consumers. Although a substantial portion of our research and development work is done in support of specific new vehicles that are in development, we also engage in research and development of new technologies outside of our regular product development cycles that, if successful, can be applied in new products. As is typical in the automotive industry, we often collaborate with our suppliers, government agencies and higher educational institutions on research and development.

Our research and development spending is used for a number of activities that support development of new and existing vehicles and powertrain technologies, including the building of three-dimensional models, virtual simulations, prototype building and testing (including with respect to the integration of safety and powertrain technologies) and assembly of pre-production pilot models.

As provided in the 2010-2014 Business Plan, we have significantly expanded our investment in research and development activities and prioritized development of vehicles with greater fuel efficiency and reduced emissions. These efforts culminated most recently in the launch of the 2013 Ram 1500, the first full-size pick-up to achieve a U.S. Environmental Protection Agency, or EPA, rated fuel economy of 25 miles per gallon on the highway. It also led to the development of the Dodge Dart, a small fuel-efficient vehicle with an EPA-rated fuel economy of up to 41 miles per gallon highway.

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The following summarizes our research and development expenses (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Research and development expenses, net	$	2,320	$	2,324	$	1,674

Fuel-Efficiency and Reduced Emissions

We have made the development of more fuel efficient vehicles a priority to meet retail customer preferences, comply with current and future regulations and as part of our commitment to sustainability. We are therefore focusing our research efforts on five areas aimed at reducing fuel consumption and emissions: vehicle energy use (weight, aerodynamics, drag and rolling resistance); engines; transmissions; axles and drivelines; electric and hybrid propulsion and alternative fuel technologies.

Vehicle Energy Use

Our research in vehicle energy demand examines ways to optimize vehicle weight, aerodynamic drag, tire performance, braking drag and driveline losses. For example, we have increased our use of high-strength steel and other lightweight materials to reduce vehicle weight, and thus improve fuel economy, while still meeting standards for vehicle safety. To further reduce vehicle weight, we have introduced high pressure, light-weight aluminum casting technology into our vehicles, including the front and rear suspension cross-members in the Dodge Dart. Our research also seeks to reduce electrical loads through application of higher efficiency fans and fuel pumps.

In addition, we continue to research vehicle applications for thermal management, which optimizes the way in which energy is utilized, extracted and re-utilized so as to reduce total energy consumption. Thermal management technologies not only help reduce fuel consumption, but they are a critical factor in extending battery range for hybrid electric and all-electric vehicle models. Our current research efforts include various strategies to warm engines and transmissions faster, to have our vehicles run at an ideal set point, and to recapture waste heat.

Our new Ram 1500 and the Dodge Dart both incorporate many of the technologies we have developed to manage energy demand, including active grille shutters to improve aerodynamic drag and to moderate temperature, electric power steering and increased use of LED lighting to reduce the vehicle’s overall energy consumption. In 2013, certain of our vehicles began to incorporate a low-tension belt for the front-end accessory drive, which further improved fuel savings.

To further reduce fuel consumption, we incorporated stop/start technology into the new Ram 1500 as well as the diesel version of the Jeep Wrangler that Fiat is selling on our behalf in Europe. Stop/start technology turns off the engine and fuel flow at full stops, and re-starts the engine automatically upon acceleration. We plan to integrate this fuel-saving start/stop technology in several more models on a global basis.

Powertrain Technologies

Engines. For the third year in a row,Ward’s Auto recognized the Pentastar V-6 engine in 2013 as one of the “10 Best Engines”, based upon its refinement, power, fuel efficiency and low emissions. This engine features a light-weight aluminum block with variable valve timing that improves fuel efficiency over its pre-2010 predecessor engines.

We use the Pentastar V-6 engine in the Jeep Grand Cherokee, the Ram 1500 and in 15 other vehicles. Because this engine was designed with flexible architecture, we have the ability to use the engine in a range of models, and to use it together with a variety of advanced technologies, such as direct injection or turbo charging.

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We manufacture the Pentastar V-6 engine at our facilities in Trenton, Michigan, and Saltillo, Mexico. High demand for this engine led to production of more than three million Pentastar engines as of December 31, 2013, and we have taken steps to further expand our capacity for production.

For the Fiat 500, we also manufacture the FIRE engine which incorporates Fiat’s MultiAir technology. This added a fuel-efficient small engine to our portfolio. Fiat’s MultiAir technology involves proprietary hardware, combustion strategies and controls that provide cycle-by-cycle control of engine intake valve lift and timing.

Fiat has now developed MultiAir II, which maximizes the combustion efficiency by simultaneously managing the intake valves, throttle position and spark timing. We believe these enhancements will improve torque and fuel economy beyond that of the original MultiAir technology. We have applied this new technology to the new 2.4 liter, 4-cylinder Tigershark engine available in the 2014 Dodge Dart GT and the all-new 2014 Jeep Cherokee. This engine provides better fuel economy and refinement than our current World Gas Engine.

Our engine mix is intentionally moving toward smaller, 4-cylinder engines. In 2013, 27 percent of our vehicles incorporated a 4-cylinder engine, as compared to 26 percent in 2012, 24 percent in 2011 and 19 percent in 2010. We expect this trend of increasing use of smaller engines to continue.

Transmissions. We have two commercial agreements with one of our key suppliers, ZF Friedrichshafen AG, or ZF, for the design, engineering and manufacture of new automatic transmissions that deliver reduced fuel consumption combined with improved driving performance. The first agreement covers a rear-wheel drive 8-speed transmission for light- and medium-duty applications that we originally introduced in 2011 in the Chrysler 300 and Dodge Charger. We have now included this transmission in the new Ram 1500, the Jeep Grand Cherokee, including in the diesel version, and the Dodge Durango. This transmission reduces fuel consumption by up to 12 percent over most of our current 5-speed and 6-speed transmissions. We ultimately plan to use this transmission in all of our rear-wheel drive vehicles except the heavy-duty and chassis cab versions of the Ram truck and the all-new SRT Viper.

The second agreement with ZF covers the development and manufacture of an all-new 9-speed front-wheel drive transmission for medium-duty applications. This transmission is expected to reduce fuel consumption by up to seven percent over our current 6-speed transmissions. We use this transmission in the all-new 2014 Jeep Cherokee and plan to use it in other future vehicles. We manufacture the majority of our volume requirements for both the 8- and 9-speed ZF transmissions at our own facilities in Kokomo, Indiana under licenses from ZF, and we purchase the remainder of our volume requirements from ZF.

In 2012, we introduced Fiat’s dual dry clutch transmission, or DDCT, in select versions of the Dodge Dart. The DDCT combines the basic mechanical system of a conventional manual transmission assembly with an electronically controlled shifting system that the driver operates like an automatic transmission. The DDCT achieves improved fuel economy over a conventional automatic transmission when used in small- to medium-sized vehicles.

Axles and Driveline. We have a commercial agreement with an affiliate of ZF through which they produce light-weight axles at our facility in Marysville, Michigan. This relationship affords us access to advanced axle technologies we could not develop on our own without investing significant time and capital. In 2011, we incorporated the front and rear ZF axles in our Jeep Grand Cherokee, the Dodge Durango and the Ram pick-up trucks.

We also produce the only all-wheel drive passenger vehicles that incorporate front and rear-axle disconnect technology. When the axle is disconnected, the number of rotating components in the driveline is reduced, thus enhancing fuel economy. This feature, which we incorporated in 2011 in our all-wheel drive versions of the Dodge Charger and the Chrysler 300, and more recently in the all-new 2014 Jeep Cherokee, automatically changes the vehicle’s mode between two-wheel and all-wheel as changes in driving conditions occur, thereby

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improving safety and performance. When combined with our V-6 Pentastar engine, axle disconnect technology affords the Dodge Charger and the Chrysler 300 best-in-class fuel economy designations among full-size, rear-wheel drive vehicles. We use this same technology in the new Ram 1500, which has been recognized by the industry for its best-in-class highway fuel economy.

Expanding the application of the axle disconnect concept in front-wheel drive based all-wheel drive vehicle platforms, we have developed the first in the industry rear-axle disconnect technology in order to further improve the fuel economy, along with retaining the vehicle capability. This advanced driveline solution was introduced in the all-new 2014 Jeep Cherokee.

Hybrid Propulsion and Alternative Fuel Vehicles

Our research activities include the development of technologies that can be used in a wide range of electrified vehicles, including conventional hybrids, or HEV, plug-in hybrids, or PHEV, range-extended electric vehicles and full-function electric vehicles, or EV. HEV includes both an internal combustion engine and an electric motor to propel the vehicle, and the battery is charged by the internal combustion engine. PHEV is similar to HEV, but is capable of limited all-electric driving with its battery being charged by the internal combustion engine while the vehicle is in operation, or otherwise using an on-board charger connected to an external electric power source. EV on the other hand relies solely on an electric motor for propulsion and its larger battery is charged using an external electric power source.

With respect to these advanced technologies, we are creating cost reduction strategies such as modular systems and components that can be utilized across various types of vehicles to ensure affordability in the future. Additionally, significant effort is focused on optimizing internal combustion engine technologies that are synergistic with HEV and PHEV.

In June 2013, we started selling our first production EV, the Fiat 500e, to U.S. consumers in California. This ZEV earns an industry-best EPA highway fuel economy rating of 108 miles per gallon equivalent, while also achieving best-in-class EPA combined city/highway driving range of 87 miles.

After two years of testing, our U.S. Department of Energy demonstration projects for Ram truck and Chrysler minivan PHEVs are undergoing upgrades to leverage advancements in lithium ion battery technology. These programs are scheduled for completion in 2014.

In 2013, we launched the Jeep Grand Cherokee powered by Fiat’s 3.0L V-6 EcoDiesel engine in North America which has a best-in-class highway fuel economy rating of 30 miles per gallon as well as best-in-class driving range and this engine was awarded one ofWard’s Auto “10 Best Engines” for 2014. We also introduced this same EcoDiesel engine in the Ram 1500 in the first quarter of 2014 in North America. We expect the Ram 1500 EcoDiesel will have best-in-class highway fuel economy in the full-size truck segment. In addition, the Ram 1500 was recently awarded theMotor Trend 2014 “Truck of the Year.”

We are producing vehicles that utilize compressed natural gas, or CNG, and are exploring use of other alternative fuel sources. In late 2012, we launched a bi-fuel version of the Ram 2500, originally intended only for fleet sales, but we have expanded to retail sales at the request of consumers. This vehicle is capable of utilizing either CNG or gasoline.

Uconnect Technology

Our Uconnect systems provide our retail customers access to traditional broadcast media, as well as Hybrid Digital (HD) radio, satellite broadcasts, personal content and rear seat entertainment, navigation services, traffic and travel data, and hands-free communication. Our second generation of Uconnect systems, which we incorporated in vehicles starting in 2011, provided certain improvements such as a new 8.4-inch touch-screen,

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simplified steering wheel controls and hands-free voice commands. The system, as included in the Dodge Charger, received the Edmunds.com “Breakthrough Technology Award” for 2012.

We have introduced the third generation Uconnect Systems and Services, named Uconnect Access, in the 2013 Ram 1500, all-new 2013 SRT Viper, 2014 Jeep Grand Cherokee, all-new 2014 Jeep Cherokee, 2014 Durango and all-new 2015 Chrysler 200. This platform can be personalized to serve the needs of consumers with varying degrees of skill and comfort with technology, and includes the option to download, over the air, Chrysler Group-certified applications, such as the connected social search application, Yelp, that are integrated with the vehicle’s onboard navigation system. Uconnect Access via Mobile was introduced in 2013 and allows drivers to control personalized content from popular mobile applications, such as Pandora. These applications, while similar to those found on smartphones and tablets, are specifically designed for in-vehicle use. In addition to offering telematics services such as emergency notification and remote start, the new system includes the first cloud-based voice texting services offered by a domestic automaker, which leverages the system’s natural language voice recognition technology. We were the first in the industry to migrate the content of owner’s manuals onto smartphone apps, which improved electronic information accessibility for customers and reduced environmental impact by reducing paper-printing. We are also the first automaker to be able to offer the full set of Sirius XM satellite channels. In 2013, Uconnect Access was awarded the first-ever “Technology of the Year” award from AOL Autos.

This platform is designed so that it can be leveraged globally across our entire vehicle lineup, and can be easily upgraded in the future as technology continues to evolve. In addition to the wide range of connectivity options and intuitive and responsive user interface capabilities of our newest system, all of which aim to enhance the driving experience and reduce driver distraction, we are continuing to develop integration of our vehicles with our retail customers’ own smartphones and inclusion of vehicle diagnostic services.

Intellectual Property

We hold numerous patents for use in our business. We also jointly own or hold licenses to intellectual property in certain technologies with Fiat and other third parties pursuant to various commercial agreements. No single patent is material to our business as a whole. We also own a number of trademarks and service marks that are critical to the recognition of our products by consumers, including, in particular, the Chrysler, Jeep, Dodge, Ram, SRT and Mopar marks, described in —Brands above.

Our intellectual property portfolio is supplemented by our license of certain intellectual property obtained from Fiat in the 363 Transaction. The license is exclusive in North America and non-exclusive for other parts of the world.

Raw Materials, Services and Supplies

We procure a variety of raw materials, parts, supplies, utilities, transportation and other services from numerous suppliers to manufacture our vehicles, parts and accessories, primarily on a purchase order basis. Raw materials we use typically consist of steel, aluminum, resin, copper, rubber, and precious metals including platinum, palladium and rhodium. In the past year, prices have stabilized, allowing us to purchase certain commodities at lower costs compared to recent years.

Although we have not experienced any major loss of production as a result of material or parts shortages, we, like our competitors, regularly source systems, components, parts, equipment and tooling from a sole provider or limited number of providers. Therefore, we are at risk of production delays and losses should any supplier fail to deliver goods and services on time. SeeRisk Factors —Risks Relating to Our Business —If our suppliers fail to provide us with the raw materials, systems, components and parts that we need to manufacture our automotive products, our operations may be disrupted which would have a material adverse effect on our businessand—Most of the components, parts and systems we use are sourced exclusively from a single supplier.

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Supply of raw materials, parts and components may also be disrupted or interrupted by natural disasters, such as the 2011 earthquake and tsunami in Japan. In such circumstances, we work proactively with our suppliers to identify shortages of materials and parts, and take steps to mitigate the impact of any shortages we identify, by deploying additional personnel, accessing alternative sources of supply and managing our production schedules. We also continue to refine our processes to identify emerging capacity constraints in the supplier tiers given the ramp up in manufacturing volumes to meet expected growth in consumer demand. Further, we continuously monitor supplier performance according to key metrics such as part quality, delivery performance and financial solvency to proactively manage risks in the event of a downturn affecting particular suppliers.

We work with our suppliers on an ongoing basis to reduce our supply costs whenever possible. When one of our suppliers proposes a program or method that results in a technical cost saving to us, we share that cost saving equally with the supplier for a one-year period after such program or method is implemented, which we believe encourages our suppliers to actively pursue efforts that will reduce our supply costs.

Environmental and Regulatory Matters

The automotive industry is subject to extensive government regulation. Chief among these are vehicle and engine requirements governing safety, emissions and fuel economy, and the environmental impacts of our manufacturing operations. As described below, regulations in the U.S. and other countries impose substantial testing, certification and verification requirements with respect to vehicle emissions, fuel economy, noise and safety, and with respect to the environmental aspect of the operations of our manufacturing plants and other facilities. We are also subject to substantial rules and regulations designed to protect the health and safety of our workforce. The costs of complying with these requirements can be significant, and violations with respect to these requirements can result in fines, penalties, sales limitations, vehicle recalls, cleanup costs, reconfiguration of our facilities and claims for personal injury or property damage.

Vehicle Emissions

U.S. Standards.Under the Clean Air Act, EPA and the California Air Resources Board, or CARB, (by EPA waiver) require emission compliance certification before a vehicle can be sold in the U.S. or in California (and other states that have adopted the California emissions requirements). Both agencies impose limits on tailpipe and evaporative emissions of certain smog-forming pollutants from new motor vehicles and engines. Pre-production testing data must demonstrate compliance with such standards to obtain emissions certification. For vehicles sold in the U.S., EPA’s Clean Air Act Tier 2 tailpipe emissions standards, or Tier 2 standards, currently apply to passenger cars and light-duty trucks (which for this purpose includes our minivans, SUVs and pick-up trucks other than the Ram 2500/3500 models), and heavy-duty emissions of regulated compounds standards apply to heavy-duty vehicles (our Ram 2500/3500 model and chassis cab trucks).

Currently, EPA has proposed (but has not issued) new tailpipe and evaporative emission standards, as well as fuel requirements under its Tier 3 Vehicle Emission and Fuel Standards Program, or Tier 3 standards. These Tier 3 standards are generally more stringent than the Tier 2 standards. The Tier 3 standards are also generally aligned with California’s Low Emission Vehicle III, or LEV III, tailpipe and evaporative standards (see discussion below). Once issued, the Tier 3 standards would become effective in model year 2017 for light-duty vehicles, and 2018 for heavy-duty vehicles. These standards would further require us to conduct post-production vehicle testing to demonstrate compliance with these emissions limits for the estimated useful life of a vehicle, for up to 15 years and 150,000 miles, depending on the compliance category. Under Tier 2 standards and Tier 3 standards, we are required to monitor and report issues with the emissions performance over that time, and can be required to recall, repair or stop delivery of non-conforming vehicles.

In addition, EPA and CARB regulations require that a vehicle’s emissions performance be monitored with onboard diagnostic, or OBD, systems.We have implemented hardware and software systems to comply with the OBD requirements.Conditions identified through OBD systems could lead to vehicle recalls (or other remedial

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actions such as extended warranties) with significant costs for related inspections, repairs, or per-vehicle penalties.

California Standards.California sets its own, generally more stringent, emissions standards pursuant to a waiver from EPA under the Clean Air Act. CARB has adopted requirements relating to vehicle certification, OBD, and tailpipe, evaporative and greenhouse gas emissions limitations known as the LEV III standards, which apply to 2014 model year vehicles. CARB regulations also require that a specified percentage of cars and certain light-duty trucks sold in California must be ZEVs, such as electric vehicles or hydrogen fuel cell vehicles. A manufacturer can earn credits toward the ZEV requirement through the sale of advanced-technology vehicles such as hybrid electric vehicles or natural gas vehicles with extremely low tailpipe emissions and, as set forth in the LEV III standards, or by over-complying with the federal model year 2017 through 2025 GHG standards, retiring such credits, and applying them to its ZEV obligation. Through the 2017 model year, ZEV rules also provide certain ZEV credits for partial zero-emission vehicles, or PZEVs, which can include internal combustion engine vehicles certified to very low tailpipe emissions and zero evaporative emissions. The ZEV regulations, which CARB revised most recently in February 2009 for the 2012 and subsequent model years, require increasing volumes of battery electric and other advanced technology vehicles with each model year. We currently comply with the ZEV requirements using a variety of vehicles, including battery electric vehicles (full ZEVs), PZEVs and hybrid vehicles.

The Clean Air Act permits other states to adopt California’s stricter emission standards. Twelve other states (New York, Massachusetts, Maine, Vermont, Connecticut, Delaware, Pennsylvania, Rhode Island, New Jersey, Oregon, Washington and Maryland), as well as the Province of Quebec, currently use California’s LEV III standards in lieu of the federal EPA standards, and 10 of those states also have adopted California’s ZEV requirements. California also has GHG emissions limitations, which are discussed below under the caption —Vehicle Fuel Economy and GHG Regulation.

Regulatory Fleet Aggregation.Under U.S. and California GHG regulations, as well as Corporate Average Fuel Economy, or CAFE, standards and California’s ZEV requirements, sales of certain Fiat entities’ and Chrysler Group’s fleets must be combined.

European Standards.The European Union, or EU, regulates tailpipe smog-forming pollutant and evaporative emissions for vehicles sold in its member states. Other European countries have adopted similar regulations from the United Nations Economic Commission for Europe. European regulations, like those in the U.S., require certification by regulatory authorities of the emissions performance of our new vehicles before the vehicles can be sold. The Euro-5 EU emission standard was adopted in 2009 and applies to vehicles through the 2013 model year. The more stringent Euro-6 EU standard applies to 2014 and later model year vehicles. The new standards will require the development of additional diesel engine technology, which is likely to increase the cost of diesel engines and compromise overall fuel economy. The EU also requires such programs as OBD and pre- and post-production testing. We expect the combined Chrysler Group and Fiat vehicle fleet to meet the requirements of both the Euro-5 and Euro-6 standards, as applicable.

Other Regions.Vehicles sold in Asia, South America and other parts of the world also are subject to local emissions and evaporative standards and OBD requirements. We expect to comply with such requirements, which generally are based on the EU standards, California standards, or a hybrid standard based on those established programs.

Vehicle Fuel Economy and GHG Regulation

U.S. Requirements. Since enactment of the 1975 Energy Policy and Conservation Act, or EPCA, the NHTSA, has established minimum CAFE requirements for fleets of new passenger cars and light-duty trucks sold in the U.S. A manufacturer is subject to civil penalties if it fails to meet the CAFE standards in any model year, after taking into account all available credits for performance in the last three model years or expected performance in the

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next five model years. Passenger cars imported into the U.S. are averaged separately from those manufactured in the U.S., but all light-duty trucks are averaged together.

The 2007 Energy Independence and Security Act, or EISA, revised EPCA and required NHTSA to establish more stringent CAFE standards beginning with the 2011 model year. Among other things, although there will continue to be separate standards for cars and light-duty trucks, standards must be set such that they increase year over year to achieve an industry-wide standard by 2016. These CAFE standards applicable to all manufacturers’ 2011-2016 model year domestic and imported passenger car and light-duty truck fleets are “footprint-based,” meaning that each manufacturer’s fuel economy requirement is dependent on the size of the vehicle, and mathematically averaged per the sales volumes and the mix of models in the manufacturer’s fleet for that model year. Meeting these CAFE standards is causing us to make costly adjustments to our product plans through the 2016 model year.

In addition, there has been significant interest among vehicle manufacturers, governmental authorities, environmental groups, and consumers regarding the impact of vehicle GHG emissions, primarily carbon dioxide, or CO₂, on the global climate. There remains significant conflicting regulatory overlap in this area since regulating GHG vehicle emissions also has the direct effect of regulating fuel economy.

In May 2009, President Obama announced an agreement in principle among EPA and other federal agencies, the State of California and the automotive industry to establish a coordinated national program to reduce GHGs under the Clean Air Act and improve fuel economy under CAFE. EPA (under its GHG standards) and NHTSA (under its CAFE standards) subsequently issued a joint final rule to implement a coordinated national GHG and fuel economy program for light-duty vehicles (passenger cars, light-duty trucks, and medium-duty passenger vehicles), establishing standards for model years 2012 through 2016, calling for year-over-year increases in fuel economy until the average fleet-wide standards reach 35.5 miles per gallon by 2016. Although California adopted a more stringent GHG rule under California law, compliance with the federal rule constitutes compliance with CARB’s rule. Additionally, EPA and NHTSA issued a joint final rule on September 15, 2011, that establishes a similar GHG/fuel economy national program for medium and heavy-duty vehicles, beginning with model year 2014 for GHG standards, and model year 2016 for fuel economy standards.

On August 28, 2012, EPA and NHTSA issued a joint final rule to extend the joint GHG/fuel economy national program for light-duty vehicles to model years 2017 through 2025, again requiring year-over-year increases in fuel economy until the average fleet-wide standards reach 54.5 miles per gallon by 2025. The rule calls for a “mid-term review” to be completed by 2021 that compels EPA and NHTSA to evaluate the market acceptance of advance vehicle technology, as well as other assumptions that formed the basis for the stringency of this rule to determine whether the standards are appropriate. Again, under California law, compliance with the federal GHG rule constitutes compliance with CARB’s GHG rule. The model year federal 2017-2025 GHG rule contains a variety of compliance flexibilities, including incentives for sales of electric vehicles and hybrids, as well as alternative fuels like compressed natural gas or hydrogen fuel cell vehicles, and the use of the new ultra low- global warming potential refrigerant HFO1234yf. NHTSA’s corresponding proposed CAFE rule imposes new vehicle safety standards in conjunction with the fuel economy standards.

While we believe that our current product plan will meet the applicable federal and California GHG/fuel economy standards established through model year 2016, our compliance is dependent on our ability to implement design and testing features that would generate GHG credits pursuant to the federal GHG rule for model years 2012-2016, and 2017-2025, on a credit carry-forward and carry-back basis. Moreover, based on projected sales volumes and fleet mix, compliance with the standards as proposed for the 2017 through 2025 model years will require us to take further costly actions or to limit the sale of certain of our vehicles in certain states. If the vehicles we develop to comply with these requirements are not appealing to consumers or cannot be sold at a competitive price, we may not be able to achieve the vehicle fleet mix, depending on the type and volume of our customers’ purchases, which would enable us to meet the stringent fuel economy/GHG requirements, even though our long-range projection plans out a compliant path. Additionally, if pending

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litigation challenging EPA’s ability to regulate GHG vehicle emissions as a pollutant is successful (such that the model years 2012 through 2016 rule is voided) and, as a result, CARB enforces its GHG rule separately, we would need to adjust our product plan and would incur additional cost.

European Requirements. The EU promulgated passenger car CO₂ emissions regulations, beginning in 2012 and phasing in compliance through 2015. These regulations target vehicle weight, calculated as an average across the manufacturer’s fleet. The law also provides certain flexibility, such as credits for “eco-innovations,” alternative fuel use, and vehicles with very low CO₂ emissions. We are developing a compliance plan based on our predicted fleets and vehicle CO₂ emissions averages of Chrysler Group and Fiat vehicles sold in Europe as a combined fleet. The EU also adopted CO₂ emissions standards for light commercial vehicles, a program similar to the passenger car program.

Another set of regulations, called the “complementary measures” laws, could potentially require low-rolling resistance tires, tire-pressure monitors, gear shift indicators, fuel economy indicators and more efficient air conditioners. Some EU members have adopted or are considering CO₂-based tax incentives.

Canadian Requirements. Canadian federal emissions regulations are substantially similar to the U.S. regulations described above, including compliance certification requirements.

Mexican Requirements.On June 21, 2013, the Mexican Ministry of Environment and Natural Resources issued a new final GHG regulation applicable to manufacturers and importers of light-duty vehicles in Mexico. This rule is based on the model years 2012 through 2016 U.S. GHG rule described below under —Requirements in Other Regions.

Requirements in Other Regions.Other countries, such as China, Korea, India and South American countries have proposed or are considering establishing fuel economy/GHG emissions requirements that would pose additional compliance obligations and may increase our costs to manufacture vehicles.

Vehicle Fuel Content

For years, EPA regulations have allowed conventional gasoline to contain up to 10 volume percent ethanol, or E10, and we and other vehicle manufacturers designed our vehicles to accommodate E10. Ethanol is an alcohol-based fuel generally made with starch crops, such as corn, or cellulosic sources, such as wood or other biodegradable materials. Proponents of ethanol maintain that its use can reduce GHG emissions and dependence on oil. On November 15, 2013, EPA proposed a reduction in the amount of ethanol in the U.S. gasoline supply, an action which may signal a scaling back of efforts for increased biofuel content in fuels.

In response to an application filed by ethanol manufacturers, EPA granted waivers under the Clean Air Act that allow fuel manufacturers to introduce gasoline containing up to 15 volume percent ethanol, or E15, for use in certain light-duty vehicles (including passenger cars, light-duty trucks and SUVs). The first waiver, granted in October 2010, allows such use in model year 2007 and newer vehicles, and the second waiver, granted in January 2011, allows such use in model year 2001 through 2006 vehicles.

In connection with the E15 waiver application, the automotive industry expressed concern to EPA that the use of E15 in prior model year vehicles designed solely for E10 could result in fuel system failures, OBD system warnings, customer dissatisfaction and increased warranty claims since ethanol is more corrosive than gasoline. EPA imposed conditions on the waivers, and issued a “misfueling rule,” the combination of which EPA believes will assure the quality of E15 and reduce the potential for misfueling of older model year vehicles. Despite a challenge by automotive industry representatives and other groups, EPA’s waivers were upheld in court. The industry similarly has challenged certain provisions of the misfueling rule. Currently, E15 is being sold at a limited number of fueling stations in the United States.

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Vehicle Safety Regulations

U.S. Requirements.Under federal law, all vehicles sold in the U.S. must comply with all applicable Federal Motor Vehicle Safety Standards, or FMVSS, promulgated by NHTSA, and also must be certified by their manufacturer as being in compliance with those standards. In addition, if a vehicle contains a defect that is related to motor vehicle safety or does not comply with an applicable FMVSS, the manufacturer must notify vehicle owners and provide a remedy. Moreover, the Transportation Recall Enhancement, Accountability, and Documentation Act requires manufacturers to report certain information related to claims and lawsuits involving fatalities and injuries in the U.S. if alleged to be caused by their vehicles, and other information related to customer complaints, warranty claims, and field reports in the U.S., as well as information about fatalities and recalls outside the U.S.

Several new or amended FMVSSs will take effect during the next few years (sometimes under phase-in schedules that require only a portion of a manufacturer’s fleet to comply in the early years of the phase-in). These include an amendment to the side impact protection requirements that added several new tests and performance requirements (FMVSS No. 214), an amendment to roof crush resistance requirements (FMVSS No. 216), and a new rule for ejection mitigation requirements (FMVSS No. 226). In addition, NHTSA has proposed to adopt a new FMVSS that would require all light vehicles to be equipped with a rear-mounted video camera and an in-vehicle visual display, and another to mandate the content recorded on event data recorders. Compliance with these new requirements, as well as other possible prospective NHTSA requirements, is likely to be difficult and/or costly.

NHTSA recently published guidelines for driver distraction and, although not rising to the level of a FMVSS, there may be substantial costs associated with conformance.

At times, organizations like NHTSA or IIHS will issue or reissue safety ratings applicable to vehicles. Changes to these ratings are subject to the agencies’ discretion. IIHS recently introduced new tests and modified its “Top Safety Pick” protocol. Pursuant to the new protocol, many of our vehicles’ existing Top Safety Pick ratings are at risk, and we could incur significant expense to maintain those ratings, or could suffer negative public relations if we do not maintain them.

Finally, NHTSA has announced its intention to issue regulations regarding its Connected Vehicles strategy. These regulations could subject us to substantial costs for vehicle integration components and software and may require auto manufacturers to provide significant funding for a national technology operating system. The regulations may also implicate cybersecurity issues that place additional legal and financial responsibilities on us.

Requirements in Other Regions. We are subject to certain safety standards and recall regulations in the markets outside the U.S. in which we operate. Foreign safety standards often have the same purpose as the U.S. standards, but they may differ in their requirements and test procedures. From time to time, other countries adopt safety requirements that are unique and usually require revised or additional vehicle design. Additionally, the EU and many other countries require “type approval” by a government agency before a vehicle can be sold, while the U.S. and Canada require “self-certification” by the manufacturer.

Environmental Regulation of Manufacturing Operations

We operate manufacturing facilities and other facilities, primarily in the U.S., Canada and Mexico, that are subject to a multitude of federal, state/provincial and local environmental protection laws, including those that govern air emissions, water discharges, hazardous substance handling, storage and use, waste generation, management and disposal, remediation of site contamination, odor and noise. These requirements impose various operating permit, data collection and reporting requirements. We have incurred, and expect to continue to incur, significant costs and will make investments to comply with these laws and regulations. In addition, we could incur substantial costs, including cleanup costs, fines and civil or criminal sanctions and third-party claims for

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property damage or personal injury, as a result of violations of or liabilities under environmental laws or non-compliance with environmental permits required at our facilities.

A variety of air, water and waste regulations are currently the subject of litigation and rulemaking procedures that might result in potential modifications to the rules. Additionally, new and existing regulations of nitrogen dioxide in the U.S. and Canada impose local air quality limits on the emissions from manufacturing facilities that must be managed continuously, and can impact expansion activities.

As a result of the federal vehicle GHG standards that were finalized in May 2010 and came into effect in January 2011, CO₂ and other GHGs were deemed to be pollutants subject to regulation under the Clean Air Act. Consequently, in May 2010, EPA issued a regulation that phased in new requirements for operating permits for facilities based on annual emissions of GHGs from manufacturing plants. The rule tailors the application of two operating permit programs, the prevention of significant deterioration program and the Title V program, to facilities based on their emissions level, industrial category, and current permit status. EPA has issued further rulemaking and guidance on the requirement, though questions still remain on rules regarding the use the “best available control technology” and other matters. There is litigation by a variety of U.S. manufacturers and trade associations that has reached the U.S. Supreme Court that is challenging the model year 2012 through 2016 light duty GHG rule, insofar as that rule triggered regulatory control of GHG emissions from U.S. manufacturing facilities. If this litigation is successful in voiding the vehicle GHG rule for model year 2012 through 2016, we could be subject to the stricter California standards in both California and in the states that adopted the California standards, which outcome could cause us to incur additional expenses for the modification of vehicles, or could limit the sale of certain vehicles. These new facility-based GHG requirements will apply to most of our U.S. manufacturing and other facilities, may require us to install additional pollution control equipment and/or change operating processes.

We expect facility-related environmental requirements applicable to our industry to become more stringent over time, and significant expenditures could be required to comply with environmental requirements that may be adopted, amended or imposed in the future or as a result of changes in interpretation or results of litigation relating to existing or pending requirements.

Occupational Safety

The federal Occupational Safety and Health Administration, or OSHA, enforces and promulgates regulations under the Occupational Safety and Health Act of 1970, as amended, or the OSH Act. These laws establish certain employer responsibilities, including maintenance of a workplace free of recognized hazards likely to affect the health and safety of our employees, including that which could cause death or serious injury. In particular, we must comply with safety and toxicological standards promulgated by OSHA, as well as various record keeping, disclosure and procedural requirements that apply to our operations. We have incurred, and will continue to incur, capital and operating expenditures and other costs in the ordinary course of our business to comply with the OSH Act and other state and local laws and regulations. Any failure to comply with these regulations could result in fines by government authorities and payment of damages to private litigants and affect our ability to service our customers and adversely affect our consolidated results of operations.

Employees

The following summarizes the number of our salaried and hourly employees as of December 31 of the respective years:

Employees	2013		2012		2011		2010		2009
Salaried		20,389		18,558		16,116		13,706		12,405
Hourly		53,323		46,977		39,571		37,917		34,921
Total		73,712		65,535		55,687		51,623		47,326

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The increase in our total workforce in 2013 is primarily attributable to the hiring of manufacturing employees to support our current and anticipated production volumes, as well as additional engineering, research and development and other highly skilled employees to support our product development, sales, marketing and other corporate activities. The increases in our salaried workforce in 2011 and 2012 were largely attributable to our increased hiring of engineers and other research and development employees.

In the U.S. and Canada combined, substantially all of our hourly employees and approximately 20 percent of our salaried employees were represented by unions under collective bargaining agreements, which represented approximately 64 percent of our worldwide workforce as of December 31, 2013. The UAW and Unifor (formerly the CAW), represent substantially all of these represented employees in the U.S. and Canada, respectively.

In October 2011, the UAW ratified a new four-year national collective bargaining agreement. The provisions of this agreement, which cover approximately 38,000 U.S. hourly and salaried employees as of December 31, 2013, continued many of the concessions achieved through the 2009 amendments, but also include certain opportunities for success-based compensation based upon certain quality metrics and financial performance. The agreement provides UAW-represented employees with a simplified profit sharing plan that is directly aligned with our profitability. The agreement expires in September 2015.

In September 2012, the CAW (which merged with the Communications, Energy and Paperworkers Union in September 2013 to form a new union called Unifor) ratified a new four-year collective bargaining agreement. The provisions of this new agreement provide for a lump sum payment to eligible Unifor employees in each of the four years. In addition, the agreement maintains the current wage rates through September 2016 for employees hired prior to September 24, 2012, or traditional employees, and starts employees hired on or after September 24, 2012 at a lower wage rate that can increase to the current maximum wage rate of traditional employees at the end of ten years. The agreement expires in September 2016.

Cyclical Nature of Business

As is typical in the automotive industry, our vehicle sales are highly sensitive to general economic conditions, availability of low interest rate new vehicle financing for dealers and retail customers and other external factors, including fuel prices, and as a result may vary substantially from quarter to quarter and year to year. Retail consumers tend to delay the purchase of a new vehicle when disposable income and consumer confidence are low. In addition, our vehicle production volumes and related revenues may vary from month to month, sometimes due to plant shutdowns, which may occur for several reasons, including production changes from one model year to the next. Model year changeovers occur throughout the year. Plant shutdowns, whether associated with model year changeovers or other factors, such as temporary supplier interruptions, can have a negative impact on our revenues and a negative impact on our working capital as we continue to pay suppliers under standard contract terms while we do not receive proceeds from vehicle sales. Refer toManagement’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Working Capital Cycle,for additional information.

Legal Proceedings

Various legal proceedings, claims and governmental investigations are pending against us on a wide range of topics, including vehicle safety; emissions and fuel economy; dealer, supplier and other contractual relationships; intellectual property rights; product warranties and environmental matters. Some of these proceedings allege defects in specific component parts or systems (including air bags, seats, seat belts, brakes, ball joints, transmissions, engines and fuel systems) in various vehicle models or allege general design defects relating to vehicle handling and stability, sudden unintended movement or crashworthiness. These proceedings seek recovery for damage to property, personal injuries or wrongful death, and in some cases include a claim for exemplary or punitive damages. Adverse decisions in one or more of these proceedings could require us to pay substantial damages, or undertake service actions, recall campaigns or other costly actions.

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Properties

We own or lease 36 principal manufacturing facilities, of which 22 are located in the U.S., seven in Mexico, six in Canada and one in South America. These manufacturing facilities primarily consist of vehicle assembly plants, powertrain plants, and metal stamping plants. Our manufacturing facilities in the U.S. are primarily located in Michigan, Indiana, Ohio, and Illinois. We own our principal engineering and research facilities and general offices, which are located in Auburn Hills, Michigan and include approximately 5.4 million square feet on 465 acres, including our 4.8 million square foot technology center.

We own proving grounds located in Michigan and Arizona, and a vehicle evaluation center located in Florida, which allow us to test vehicle performance and safety in a wide variety of environments. We operate numerous parts distribution facilities throughout the world which are primarily located in the U.S., Canada and Mexico. These locations facilitate the distribution of service and accessory parts to our dealer network and include a combination of owned and leased facilities.

We own or lease various dealership and vehicle storage properties in the U.S., Canada and Japan, which we in turn lease to our dealers. Our warehouses and sales offices are primarily leased and are located all over the world, including the U.S., Canada and Mexico.

Other than our Auburn Hills headquarters, substantially all of our owned facilities and principal properties located in the U.S. are encumbered by mortgages that secure the Senior Credit Facilities and the Secured Senior Notes. Certain of our owned facilities in Mexico have been placed in special purpose trusts to secure the repayment of the Mexican development banks credit facilities.See Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources for additional information.

We believe that our properties are suitable and adequate for the manufacture, assembly, distribution and sale of our products. As part of our strategic planning and operations, we monitor our production capacity in relation to developing and anticipated industry changes and market conditions. We also adjust our capacity by selling, expanding or downsizing various production facilities or by adding or eliminating shifts, subject to restrictions contained in our collective bargaining agreements with unions.

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MANAGEMENT

Directors of Chrysler Group

The names and ages, as of April 1, 2014, and certain background information relating to our directors are set forth below:

Sergio Marchionne

Age 61

Director Since June 2009

Term Expires June 10, 2014

Principal Occupation Chief Executive Officer, Chief Operating Officer and President of Chrysler Group LLC and Chief Executive Officer of Fiat S.pA. Mr. Marchionne leads Fiat S.p.A.’s Group Executive Council, and is Chief Operating Officer of its NAFTA region since September 2011.

Recent Business Experience Mr. Marchionne serves as Chief Executive Officer of Fiat S.p.A. and Fiat Group Automobiles S.p.A., and has held these roles since May 2004 and February 2005, respectively. Prior to joining Fiat, Mr. Marchionne served as Chief Executive Officer of SGS SA, Chief Executive Officer of the Lonza Group Ltd., and Chief Executive Officer of Alusuisse Lonza (Algroup). He also served as Vice President of Legal and Corporate Development and Chief Financial Officer of the Lawson Group after serving as Vice President of Finance and Chief Financial Officer of Acklands Ltd. and Executive Vice President of Glenex Industries. Mr. Marchionne holds a Bachelor of Laws from Osgoode Hall Law School at York University in Toronto, Canada and a Master of Business Administration from the University of Windsor, Canada. Mr. Marchionne also holds a Bachelor of Arts with a major in Philosophy and minor in Economics from the University of Toronto.

Mr. Marchionne’s extensive experience at Fiat provides the Board with expertise in the automotive industry, especially with respect to the cost discipline and collaboration strategies with Fiat needed to achieve our Company’s business plan. In September 2011, Mr. Marchionne was elected Chairman of the Board.

Outside Directorships Mr. Marchionne serves on the Board of Directors of Philip Morris International Inc. and as Chairman of SGS SA headquartered in Geneva. Additionally, Mr. Marchionne serves as Executive Chairman of CNH Industrial N.V., and as a director of Exor S.p.A., a shareholder of Fiat and CNH Industrial N.V. Mr. Marchionne is on the Board of Directors of ACEA (European Automobile Manufacturers Association). He previously served as appointed non-executive Vice Chairman and Senior Independent Director of UBS AG as well as a director of Fiat Industrial S.p.A.

Arrangements Mr. Marchionne was appointed as a director by Fiat in accordance with the terms of our governance documents.

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Léo W. Houle

Age 66

Director Since September 2011

Term Expires June 10, 2014

Principal Occupation Retired

Recent Business Experience Mr. Houle served as Chief Talent Officer of BCE Inc. and Bell Canada, Canada’s largest communications company, from June 2001 to July 2008. Prior to joining BCE and Bell Canada, Mr. Houle was Senior Vice-President, Corporate Human Resources of Algroup Ltd., a Swiss-based diversified industrial company. From 1966 to 1987, Mr. Houle held various managerial positions with the Bank of Montreal, the last of which was Senior Manager, Human Resources Administration Centers. In 1987, he joined the Lawson Mardon Group Limited and served as Group Vice-President, Human Resources until 1994 when Algroup Ltd. acquired Lawson Mardon Group, at which time he was appointed Head of Human Resources for the packaging division of Algroup and in 1997 Head of Corporate Human Resources of Algroup, Ltd.

Mr. Houle completed his studies at the College St-Jean in Edmonton, attended the Executive Development Program in Human Resources at the University of Western Ontario in 1987 and holds the designation of Certified Human Resources Professional from the Province of Ontario.

Mr. Houle’s broad experience in talent acquisition and employee development, as well as his management experience in a variety of industries, including manufacturing, provide the Board with valuable input on leveraging the Fiat-Chrysler Alliance.

Outside Directorships Mr. Houle has been a director of CNH Industrial N.V. since September 2013 and formerly served as a director of CNH Global N.V.

Arrangements Mr. Houle was appointed as a director by Fiat in accordance with the terms of our governance documents.

John B. Lanaway

Age 63

Director Since September 2011

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Term Expires June 10, 2014

Principal Occupation Self-employed Consultant and Director

Recent Business experience Mr. Lanaway served as Executive Vice President and Chief Financial Officer, North America, of McCann Erickson North America, one of the largest marketing communications networks in the world, from November 2007 until June 2011. From January 2001 to November 2007, he held similar positions at Ogilvy North America. Previously, he has held the positions of Chief Financial Officer and Senior Vice President at Geac Computer Corporation Limited from 1999 to 2001; Chief Financial Officer of Algorithmics Incorporated from 1997 to 1999; and Senior Vice President and Chief Financial Officer at Spar Aerospace from 1995 to 1996. From 1985 to 1995, Mr. Lanaway held various positions with Lawson Mardon Group Limited, including Sector Vice President, Labels North America from 1993 to 1995; Group Vice President and Chief Financial Officer from 1989 to 1992; General Manager, Lawson Mardon Graphics from 1988 to 1989; and Vice President, Financial Reporting and Control from 1985 to 1987. At Deloitte & Touche, he served as Client Service Partner from 1980 to 1985 and as Student-Staff Accountant-Supervisor-Manager from 1971 to 1980. Mr. Lanaway graduated from the Institute of Chartered Accountants of Ontario, C.A. and has a Bachelor of Arts degree from the University of Toronto.

Mr. Lanaway’s broad experience in finance and management in a variety of industries, including manufacturing, provide the Board with a relevant strategic and financial perspective on implementation of the Company’s business plans.

Outside Directorships Mr. Lanaway has been a director of CNH Industrial N.V. since September 2013 and formerly served as a director of CNH Global N.V.

Arrangements Mr. Lanaway was appointed as a director by Fiat in accordance with the terms of our governance documents.

Robert G. Liberatore

Age 64

Director Since June 2013

Term Expires June 10, 2014

Principal Occupation Consultant and Director

Recent Business Experience In 1985, Mr. Liberatore joined Chrysler Corporation, where he held a series of management positions of increasing responsibility. He was appointed Vice President-Washington Affairs for Chrysler

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Corporation in 1993, continued his service under DaimlerChrysler AG, and retired as Group Senior Vice President and Head of Global External Affairs and Public Policy for Daimler in 2008. Mr. Liberatore also served as a consultant to Chrysler Group LLC in 2010.

Before joining Chrysler Corporation, Mr. Liberatore worked for 10 years in the U.S. Senate, first as legislative director for Sen. Floyd Haskell and then as staff director for Senate Leader Robert C. Byrd. From 1972 to 1975, he was an assistant treasurer and international corporate loan officer at Chase Manhattan Bank in New York and Kingston, Jamaica.

Mr. Liberatore’s broad experience in international affairs and policy, as well as his management experience in the auto industry, provide the Board with valuable input on leveraging the Fiat-Chrysler Alliance.

Outside Directorships Mr. Liberatore formerly served as a director of Fiat Industrial S.p.A.

Arrangements Mr. Liberatore was appointed as a director by Fiat in accordance with the terms of our governance documents.

Ruth J. Simmons

Age 68

Director Since June 2012

Term Expires June 10, 2014

Principal Occupation Professor, Department of Comparative Literature and the Department of Africana Studies, Brown University

Recent Business Experience Ms. Simmons served as the President of Brown University from 2001-2012 and continues to hold the title of President Emerita. Before joining Brown University, Ms. Simmons served as President of Smith College from 1995 to 1999. She held the position of Vice Provost of Princeton University from 1992 to 1995 following her service as Provost of Spelman College from 1990 to 1992. From 1983 to 1990, Ms. Simmons held various positions of increasing responsibility until becoming Associate Dean of the Faculty, Princeton University. Previously, she has served as Assistant Dean and then Associate Dean, University of Southern California from 1979 to 1983, Acting Director of International Programs, California State University – Northridge from 1977 to 1979. Prior to that, Ms. Simmons served as Assistant Dean – College of Liberal Arts; Assistant Professor of French, University of New Orleans from 1975 to 1977 and as Admissions Officer at Radcliffe College from 1970 to 1975. From 1968 to 1970, Ms. Simmons served as an Instructor in French at George Washington University following her service as

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an Interpreter – Language Services Division at the U.S. Department of State. Ms. Simmons is a graduate of Dillard University in New Orleans (1967), and received her Ph.D. in Romance languages and literatures from Harvard University (1973). Ms. Simmons is a Fellow of the American Academy of Arts and Sciences and a member of the Council on Foreign Relations.

Ms. Simmons has significant leadership experience from her career as a university administrator, during which time she developed professionals in a wide variety of technical fields, including engineering. She also brings to the Board her familiarity with a broad range of operational issues, including technology and manufacturing, as a result of her many experiences as a board member for other large, global companies across several industries.

Outside Directorships Ms. Simmons currently serves on the board of Mondelez International and Texas Instruments. She has also served on the boards of the Goldman Sachs Group Inc., Pfizer Inc., Metropolitan Life Insurance Company, the Bill & Melinda Gates Millennium Scholars Program, and the Fulbright Prize Selection Committee.

Arrangements Ms. Simmons was appointed as a director by a committee of the independent directors of the Board in accordance with the terms of our governance documents.

Douglas M. Steenland

Age 62

Director Since July 2009

Term Expires June 10, 2014

Principal Occupation Retired

Recent Business Experience Mr. Steenland served as the Chief Executive Officer and President of Northwest Airlines Corporation from 2004 to 2008 when Northwest merged with Delta Air Lines. While CEO, he oversaw the voluntary reorganization under Chapter 11 of the U.S. Bankruptcy Code of Northwest in 2005 and its emergence from bankruptcy protection in 2007. Before becoming CEO in 2004, Mr. Steenland held a variety of positions at Northwest including President, Executive Vice President and Chief Corporate Officer, and General Counsel. Prior to joining Northwest, Mr. Steenland worked as a Senior Partner in the Washington D.C. law firm of Verner, Liipfert, Bernhard, McPherson and Hand (now part of DLA Piper). Mr. Steenland also currently serves as a Senior Advisor to the Blackstone Group. Mr. Steenland holds a Bachelor’s Degree in history from Calvin College (Michigan) and a Juris Doctor from George Washington University Law School.

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Mr. Steenland’s experience in the transportation industry, as well as his particular experience in leading a major airline through and following bankruptcy restructuring, provide the Board with valuable experience in global management and corporate restructuring.

Outside Directorships Mr. Steenland serves on the boards of several public companies, including American International Group Inc., Digital River, Inc. and Travelport Limited. Mr. Steenland also serves on the boards of Hilton Worldwide, Performance Food Group and RGIS, Inc. Mr. Steenland previously served on the boards of Delta Air Lines Inc. and Northwest Airlines Corporation.

Arrangements Mr. Steenland was originally appointed as a director by the U.S. Treasury and was subsequently reappointed by a committee of the independent directors of the Board in accordance with the terms of our governance documents.

Ronald L. Thompson

Age 64

Director Since July 2009

Term Expires June 10, 2014

Principal Occupation Retired

Recent Business Experience Until 2005, Mr. Thompson owned and operated the Midwest Stamping Company of Maumee, Ohio, a manufacturer of medium and heavy gauge metal components for the automotive market. Mr. Thompson was a faculty member at Old Dominion University, Virginia State University and the University of Michigan. Mr. Thompson holds a Bachelor of Business Administration from the University of Michigan, and a Master of Science and a Ph.D. in Agricultural Economics from Michigan State University.

Mr. Thompson’s breadth of experience in leading industrial and financial companies, as well as his background serving on various boards of directors, provides the Board with valuable corporate governance, oversight and industry experience, including restructuring. Mr. Thompson serves as our Lead Director.

Outside Directorships Mr. Thompson serves as Chairman of the Board of Trustees for Teachers Insurance and Annuity Association, as a member of the Advisory Board of Plymouth Venture Partners II Fund and was recently elected to serve on the board of the Medical University of South Carolina Foundation. He has served as a Member of the Board of Trustees of Washington University in St. Louis and has additionally served on the boards of Ralston Purina Company, McDonnell Douglas Corporation, Commerce Bank of St. Louis, GR Group (U.S.), Illinova Corporation, Interstate Bakeries Corporation,

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Midwest Stamping Company and Ryerson Tull, Inc. He was also a member of the Board of Directors of the National Association of Manufacturers.

Arrangements Mr. Thompson was originally appointed as a director by the U.S. Treasury and was subsequently reappointed by a committee of the independent directors of the Board in accordance with the terms of our governance documents.

Stephen M. Wolf

Age 72

Director Since July 2009

Term Expires June 10, 2014

Principal Occupation Managing Partner of Alpilles LLC

Recent Business Experience Mr. Wolf has served as Managing Partner of Alpilles LLC, a private investment company, since 2003. He has previously served as Chairman and Chief Executive Officer of US Airways Group, Inc. and US Airways, Inc. and oversaw the voluntary reorganization under Chapter 11 of the U.S. Bankruptcy Code of U.S. Airways Group, Inc. in 2002 and its emergence from bankruptcy protection under a plan of reorganization in 2003. Before joining US Airways, Mr. Wolf was Senior Advisor to the investment banking firm Lazard Frères & Co. LLC. Other prior roles include Chairman and Chief Executive Officer of UAL Corporation and United Airlines Inc., Chairman and Chief Executive Officer of Tiger International, Inc. and The Flying Tiger Line, Inc., President and Chief Executive Officer of Republic Airlines and President and Chief Operating Officer of Continental Airlines. Mr. Wolf holds a bachelor’s degree in sociology from San Francisco State University.

Mr. Wolf’s experience in the transportation and finance industries, as well as his particular experience in leading a major airline through and following bankruptcy restructuring, provide the Board with valuable experience in global management and corporate restructuring.

Outside Directorships Mr. Wolf serves as a member of the Board of Directors of Philip Morris International and Chairman of the Board of Directors of R.R. Donnelley & Sons Company. Mr. Wolf also serves as Chairman of the Advisory Board of Trilantic Capital Partners, previously Lehman Brothers Merchant Banking. Mr. Wolf had served as Chairman of Lehman Brothers Private Equity Advisory Board.

Arrangements Mr. Wolf was appointed as a director by Fiat in accordance with the terms of our governance documents.

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Executive Officers of Chrysler Group

The names and ages, as of April 1, 2014, of our executive officers and their positions and offices are as follows:

Name	Position(s)	Age	First Elected to Officer Position
Sergio Marchionne	Chief Executive Officer, Chief Operating Officer and President	61	2009
Steven G. Beahm	Senior Vice President — Supply Chain Management	50	2013
Douglas D. Betts	Senior Vice President — Quality	50	2009
Reid A. Bigland	Senior Vice President — Head of U.S. Sales and Head of Ram Truck Brand; President and Chief Executive Officer of Chrysler Canada Inc.	47	2011
Mark M. Chernoby	Senior Vice President — Engineering; Vice President — Product Committee Coordinator	52	2009
Olivier J. Francois	Chief Marketing Officer	52	2011
Ralph V. Gilles	Senior Vice President — Product Design; Head of SRT Brand and Motorsports	44	2009
Pietro Gorlier	Senior Vice President — Mopar Brand Service, Parts and Customer Care	51	2009
Michael J. Keegan	Senior Vice President — Human Resources; Corporate Sustainability Officer	48	2009
Scott G. Kunselman	Senior Vice President — Purchasing and Supplier Quality	50	2012
Marjorie H. Loeb	Senior Vice President — General Counsel and Secretary	49	2013
Michael Manley	Senior Vice President — International and Head of Jeep Brand	50	2009
Richard K. Palmer	Senior Vice President and Chief Financial Officer	47	2009

Each of the Executive Officers named above, excluding Messrs. Marchionne, Francois, Gorlier, and Palmer and Ms. Loeb, has been employed by the Company, Old Carco, and/or the Company’s subsidiaries for more than five years.

Mr. Marchionne joined the Company in 2009. He has held various leadership positions with Fiat or its subsidiaries since 2004. See —Directors, above.

Mr. Francois joined the Company in 2009. He has held various vehicle and brand marketing leadership positions with Fiat or its subsidiaries since 2005.

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Mr. Gorlier joined the Company in 2009. He has held various directorships and dealer network and customer care leadership positions with Fiat or its subsidiaries since 2003.

Mr. Palmer joined the Company in 2009. He has held various financial leadership positions with Fiat or its subsidiaries since 2003.

Ms. Loeb joined the Company in the Office of the General Counsel in 2010. Prior to joining the Company, Ms. Loeb was Assistant General Counsel – Corporate and Securities and Assistant Secretary of Delphi Corporation.

Each officer is elected to hold office until a successor is chosen or as otherwise provided in our governance documents.

Directors and Executive Officers of the Co-Issuer

The directors of CG Co-Issuer Inc., or the Co-Issuer, are Richard K. Palmer and Marjorie H. Loeb. Richard K. Palmer is the President and Marjorie H. Loeb is the Secretary of the Co-Issuer. For a description of Mr. Palmer’s and Ms. Loeb’s background, see —Executive Officers of Chrysler Group.

Family Relationships

No family relationships exist among any of our or the Co-Issuer’s directors or executive officers.

Corporate Governance

Limited Liability Company Operating Agreement

Our limited liability company operating agreement governs the rights and privileges associated with the Class A Membership Interests we have issued, distributions in respect of our membership interests, management and oversight of our business and operations, restrictions on transferability of membership interests and the reporting of financial and other information. Following the transaction in which Fiat indirectly acquired the remaining 41.5 percent of membership interests in us held by the VEBA Trust, we are evaluating our governance documents and structure and may revise them in the future to reflect our status as a wholly owned subsidiary of Fiat and a member of Fiat’s corporate group.

Management of the Company

We are governed by a Board of Directors which oversees our operations and affairs and approves all major decisions regarding our business. Any action authorized by the Board will constitute an act of ours and serve to bind us. Authorized actions by the Board require an affirmative vote of a majority of the directors present at a meeting at which at least a quorum is present.

Board of Directors and Nominees. Our Board currently consists of eight members. Fiat, as the sole beneficial owner of our membership interests, has the power to designate all of the directors and may designate some independent directors in its discretion.

Directors’ Duties. Our directors and officers, in the performance of their duties, owe duties of loyalty and due care of the type owed under law by directors and officers of a business corporation incorporated under the Delaware General Corporation Law, except that the doctrine of corporate opportunity or any analogous doctrine does not apply to the directors and that, other than in connection with matters as to which a director or the persons that elected such director may have a conflict of interest, no director and no person that elected such director shall have any duty to disclose to us confidential information in such director’s or person’s possession

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even if it is material and relevant information to us and/or the Board and neither such director nor such person shall be liable to us or our members for breach of any duty (including the duty of loyalty and any other fiduciary duties) as a director or person that has the right to designate such director by reason of such lack of disclosure of such confidential information. SeeCertain Relationships and Related Party Transactions for additional information.

None of our directors and officers will have liability to us, or to any of our members, for any act or omission, including the breach of any duty, if that director or officer acted in good faith and in a manner that the director reasonably believed to be in, or at least not opposed to, our best interests, except in circumstances involving fraud, willful misconduct or bad faith. We have agreed to indemnify and hold harmless our directors, officers and employees from liability incurred in connection with any proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to our best interests to the fullest extent permitted by Delaware law. Our indemnification obligation to officers and directors survives termination of our limited liability company operating agreement.

Committees of the Board of Directors. We currently have an Audit Committee, a Compensation and Leadership Development Committee and a Governance Committee.

Distributions

We may make distributions to members on a pro rata basis as declared by our Board and in a manner that complies with our limited liability company operating agreement, our financing agreements and applicable laws. Certain distributions may be made for tax liabilities, or Tax Amounts, of our members which are calculated as set forth in our limited liability company operating agreement. In no event are we permitted to make any distribution to members that would violate applicable law, including the Delaware Limited Liability Company Act pursuant to which we were organized.

Ownership

On January 21, 2014, Fiat, which beneficially held 58.5 percent of the Company’s membership interests, indirectly acquired the remaining 41.5 percent of membership interests in the Company held by the VEBA Trust. As a result, Fiat now beneficially owns 100 percent of the Company’s membership interests.

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Overview

The compensation provided to our named executive officers for 2013, our most recently completed fiscal year, is set forth in detail in the 2013 Summary Compensation Table and other tables and our accompanying audited consolidated financial statements and narrative material that follow this section. This section explains the approved compensation for each of our named executive officers in 2013, our compensation structure components and the process for making our 2013 compensation decisions. Our named executive officers for 2013, which consist of those individuals who appear in the 2013 Summary Compensation Table, were: Sergio Marchionne, our Chairman of the Board, Chief Executive Officer, President and Chief Operating Officer; Richard Palmer, our Senior Vice President and Chief Financial Officer; Reid Bigland, our Senior Vice President, Head of U.S. Sales and Head of Ram Truck Brand; President and Chief Executive Officer of Chrysler Canada Inc.; Michael Manley, our Senior Vice President —International and Head of Jeep Brand; and Mark Chernoby, our Senior Vice President, Engineering; Vice President —Product Committee Coordinator.

Prior to June 10, 2009, our named executive officers (other than Messrs. Marchionne and Palmer) were employed and compensated by Old Carco. Pursuant to the terms of the Master Transaction Agreement, employees of Old Carco became our employees and we assumed certain employee benefit plans, programs, policies and arrangements from Old Carco, subject to the condition that such assumed plans, programs, policies and arrangements comply in all respects with the Emergency Economic Stabilization Act of 2008, or EESA, as amended by the American Recovery and Reinvestment Act of 2009, as it may be amended. With limited exceptions related to contractual retirement benefits, we did not assume any individual agreements (including employment, severance, change in control or retention agreements) with the top 25 most highly compensated employees, including Messrs. Bigland, Manley, and Chernoby. In connection with the 363 Transaction and our credit agreements with the U.S. Treasury and the EDC, we agreed to comply with the restrictions on executive privileges and compensation established under section 111 of EESA for as long as the U.S. Treasury continued to hold our equity. The U.S. Treasury sold its share of our equity to FNA LLC on July 21, 2011 and, as of that date, we were no longer bound by the restrictions of EESA for compensation awarded after that date. Nevertheless, we decided that our compensation decisions would continue to be guided by EESA and the terms of our prior credit agreements with the U.S. Treasury and EDC throughout 2011.

In light of the lapse of the Troubled Asset Relief Program, or TARP, compensation restrictions, in February 2012, the Compensation and Leadership Development Committee, or the Compensation Committee, re-evaluated our existing annual and long-term incentive programs applicable to all employees, including the named executive officers. Following such review, the Compensation Committee agreed to cease any further grants under our Deferred Phantom Share Plan, or DPS Plan, for our named executive officers and other senior executives, which provided for grants of deferred phantom shares, or DPSs. In place of that plan, the Compensation Committee deemed these individuals eligible to receive an annual cash award under our existing Performance and Leadership Management Award Plan, or PLM Plan. The Compensation Committee also adopted the 2012 Long-Term Incentive Plan, or 2012 LTIP, and agreed to cease making further grants under our existing Restricted Stock Unit Plan, or RSU Plan.

In 2013, our compensation philosophy continued to center on our commitment to maintain responsible compensation practices that pay for performance, allow us to attract and retain capable and experienced professionals, and motivate our executives to help us achieve our targets for long-term growth and appreciation in value. We are focused on optimizing a culture where outstanding leadership and performance are rewarded and recognized.

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2013 Compensation Principles

During 2013, our compensation philosophy, as described above, was consistent with the following eight principles, which the Compensation Committee considered when designing our compensation structure and awarding compensation to our employees. These compensation principles are core to our compensation philosophy and serve as a guide when designing our compensation structure and awarding compensation to our employees.

Principle	Guiding Factor(s)
Culture	Compensation programs should drive the desired leadership behaviors and business results.
Risk	The compensation structure must avoid incentives that would encourage employees to take unnecessary or excessive risks that could threaten our value.
Sustainability	Compensation programs aligned to our business strategy will enable us to remain a competitive enterprise.
Attraction and Retention	Compensation and benefit programs should enable the recruitment and retention of top talent at all levels.
Appropriate Balance	Our compensation structure should appropriately allocate total compensation to fixed and variable pay elements, resulting in an appropriate mix of salary and long- and short-term compensation elements based on the specific role of the employee and other relevant circumstances.
Performance-based Compensation	An appropriate portion of compensation needs to be performance-based over a relevant performance period.
Comparable Structures and Payments	The compensation structure and amounts payable should be consistent with the compensation structure and amounts payable for employees in similar positions or roles at similar entities that are similarly situated.
Employee Contributions to Value	The compensation programs should reflect the current or prospective contributions of the individual employee to our value.

These principles represent sound compensation practices while supporting our business and financial objectives.

Compensation Components

We are committed to offering competitive pay to attract, retain and engage extraordinary talent. Our compensation programs are market competitive, aligned to the 2010-2014 Business Plan, and designed to reinforce a high performance work culture where outstanding leadership and performance are both recognized and rewarded. Our success depends on innovative, bright, and high performing employees. We are committed to offering competitive rewards that drive increased performance and accountability and allow us to differentiate based on leadership and individual performance.

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Our compensation programs are competitive with our peer group companies, based on extensive compensation survey data. Competitiveness is measured by looking at total program value relative to our comparator group. Consistent with the eight compensation principles guiding our compensation program, our 2013 compensation arrangements for our senior leadership including our named executive officers (other than Mr. Marchionne), included the following components:

Compensation Component	Why it is Important
Cash base salary	Cash base salary is a critical component to providing income security to our workforce and enables us to recruit and retain highly talented and engaged employees.
Cash award under the PLM Plan	Aligns all salaried employees to work for common goals and is linked to both our performance as a company and an individual’s performance.
LTIP Performance Share Units, or LTIP PSUs, under the 2012 LTIP	This award is linked to the achievement of our objectives and rewards long-term performance, commitment to the 2010-2014 Business Plan and contributes to our sustainability.
LTIP Restricted Share Units, or LTIP RSUs, under the 2012 LTIP	This award recognizes individual contribution and leadership which are essential to our future growth and success.
Retirement benefits	These benefits demonstrate our commitment to the financial well-being of employees now and in the future.
Other benefits and perquisites	These programs support our ability to recruit and retain the top talent needed to achieve business success.

We believe that the mix of cash/non-cash and short-term/long-term incentives provides an appropriate balance between our longer-term business objectives and shorter-term retention and competitive needs.

Cash Base Salary

Base pay is a critical component to providing income security to our workforce and enables us to recruit and retain highly talented and engaged employees. We provide our named executive officers (other than Mr. Marchionne who received no cash base salary in 2013) and other employees with a cash base salary to compensate them for services rendered on a day-to-day basis during the year. Base salaries provide stable compensation to our top employees, allow us to recruit and retain highly talented and dedicated employees and, through periodic salary adjustments, provide a basis upon which our top employees may be rewarded for individual performance and increased scope and significance of responsibilities. The base pay of all salaried employees is reviewed against market data annually, providing an opportunity to make market adjustments. When considering adjustments, we take into account individual performance and the level of pay compared to similar positions in the market.

Our Compensation Committee reviews base salary levels of our named executive officers annually to determine whether an adjustment is warranted or necessary. The Compensation Committee takes into account numerous factors in making its determination, none of which are dispositive or individually weighted, including our financial performance, the state of our industry, the named executive officer’s relative importance and

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responsibilities, the named executive officer’s location, the named executive officer’s track record in meeting his or her performance objectives and comparable salaries paid to other executives with similar experience in our compensation peer group, as described below.

We are committed to offering competitive pay, including base salaries. In support of this objective, we participate in a number of major compensation surveys and periodically review our compensation structure to ensure competitive alignment. In 2013, we utilized survey results from Aon Hewitt and Towers Watson as our primary source in the analysis and determination of executive base pay. Our executive compensation consultant, Mercer (US) Inc., or Mercer, provided additional analysis and counsel in benchmarking compensation components against the peer group and making recommendations. Overall, we target the 50th percentile for annual base salary and adjust accordingly taking into consideration the compensation principles and guiding factors described above. Targeting the 50th percentile demonstrates our desire to not only ensure the competitive base pay of our executives but also our continued focus on fiscal responsibility.

None of the named executive officers (other than Mr. Palmer) received base salary increases in 2013. In February 2013, Mr. Palmer’s base salary was increased from $650,000 to $750,000, effective January 1, 2013, based on a review of prevailing market salaries for similar positions. In addition, on November 19, 2013, the Compensation Committee approved changes to the compensation of Mr. Palmer, in connection with his transition from expatriate status to local employee status in the United States, effective December 1, 2013, and the related cessation of employee benefit entitlements under Italian pension and health arrangements together with cessation of standard expatriate benefits. Effective December 1, 2013, the Fiat employer contributions on behalf of Mr. Palmer with respect to certain Italian pension and health arrangements, as disclosed below inCertain Relationships and Related Party Transactions —Other Transactions with Fiat, discontinued, Mr. Palmer’s annual base salary increased from $750,000 to $950,000 and Mr. Palmer received a grant of 30,242 LTIP PSUs for the 2012 to 2014 performance period, as discussed below and in —Compensation of the Named Executive Officers —2013 Grants of Plan-Based Awardsand —Compensation of the Named Executive Officers —Outstanding Equity Awards at December 31, 2013.

Base salaries of the named executive officers are reported in —Compensation of the Named Executive Officers —2013 Summary Compensation Table below.

Cash Award under the PLM Plan

The PLM Plan is an annual cash award program that covers all salaried employees. Payouts under the PLM Plan are based upon both company and individual performance. The Compensation Committee has the authority to alter, amend or terminate the PLM Plan in its discretion. The PLM Plan is administered by the Senior Vice President, Human Resources of the Company, who has the authority to make determinations necessary and advisable under the PLM Plan, with the exception of establishing performance objectives, target awards, and determining award payouts for our executive officers, which are, in each case, determined by the Compensation Committee in its discretion.

In February 2013, the Compensation Committee approved a target award for each employee for 2013, including the named executive officers (other than Mr. Marchionne, who was not a participant in the PLM Plan in 2013). The Compensation Committee also established company performance metrics of Modified Operating Profit and Free Cash Flow for the fiscal year ending December 31, 2013, consistent with the prior year’s metrics. These performance metrics are Non-GAAP financial measures that we use to monitor our operations. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Non-GAAP Financial Measuresfor additional information.

Payout opportunities under the PLM Plan for 2013 were based on achievement of the equally-weighted Modified Operating Profit and Free Cash Flow performance targets, as set forth in the table below. If we achieve at least 80 percent of one or both of these targets, a payout would be made after adjustment for both the weighted level of

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achievement of each Company performance target and for individual performance. Individual performance is a subjective and discretionary assessment which evaluates the named executive officer’s overall performance against the Company’s performance and leadership metrics, and is evaluated in the Compensation Committee’s absolute discretion.

If we failed to achieve threshold performance of 80 percent of at least one of these targets, no payments would have been made under the PLM Plan, regardless of the level of individual performance. In the case of each performance metric, performance greater than threshold but less than target would result in a potential payout ranging from 50 percent to 99.99 percent of a named executive officer’s target award, and performance at or greater than target would have resulted in a potential payout ranging from 100 percent to 150 percent of an executive’s target award (subject in each case to weighting and to adjustment for individual performance).

2013 Company Performance Targets and Payout Opportunity

	Modified Operating Profit Component Weighting: 50%						Free Cash Flow Component Weighting: 50%
	Percent of Performance Target		Actual ($ billion)		% of Target Award		Percent of Performance Target		Actual ($ billion)		% of Target Award
Maximum		150%	$	5.70		150%		150%	$	2.25		150%
Target		100%	$	3.80		100%		100%	$	1.50		100%
Threshold		80%	$	3.04		50%		80%	$	1.20		50%
Actual Performance		83.6%	$	3.176		59.0%		141.5%	$	2.123		141.5%

The results of each of our Modified Operating Profit and Free Cash Flow company performance targets are expressed as a payout factor, which is multiplied by a named executive officer’s target award and then subject to discretionary adjustment by the Compensation Committee based on individual performance:

Target Award ($) X Payout Factor (%): Modified Operating Profit Component (% of Target) X 50% + Free Cash Flow Component (% of Target Award) X 50% X Individual Performance Adjustment Factor (10% to 125%) = 2013 PLM Award

Our Modified Operating Profit for 2013 was $3.176 billion, representing achievement of 83.6 percent of the $3.80 billion target (resulting in an unweighted payout factor of 59.0 percent of each participant’s target award), and our Free Cash Flow was $2.123 billion, representing achievement of 141.5 percent of the $1.50 billion target (resulting in an unweighted payout factor of 141.5 percent of each participant’s target award). These results were equally weighted to generate a rounded company performance-based payout factor of 100 percent of each named executive officer’s target award. The company performance-based payout was then subject to the Compensation Committee’s discretionary adjustment (up to 125 percent of the company performance payout under the formula initially established in February 2013), based on Mr. Marchionne’s recommendation following his assessment of each named executive officer’s individual performance in accordance with the Company’s overall performance and leadership assessment process. This subjective assessment evaluates the named executive officer’s overall performance against the Company’s performance and leadership guidelines in a non-formulaic manner. Company performance-based payouts for Messrs. Palmer, Bigland, Manley and Chernoby were adjusted upward based on their individual leadership and performance contributions. After such adjustment for individual performance, the Compensation Committee exercised its discretion under the terms of the PLM Plan to provide for an additional increase in payout amounts for Messrs. Bigland and Manley to recognize their extraordinary contributions related to refining our brands and expanding our sales, and for Mr. Palmer to recognize his significant corporate

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contributions to the Fiat-Chrysler Alliance. The actual award payouts under the PLM Plan for 2013, as reported in—Compensation of the Named Executive Officers —2013 Summary Compensation Table,totaled $550,000 for Mr. Palmer, $450,000 for Mr. Bigland, $450,000 for Mr. Manley and $345,010 for Mr. Chernoby compared to 2013 PLM Plan award targets of $387,510, $307,510, $307,510 and $300,010, respectively. See—Compensationof the Named Executive Officers —2013 Grants of Plan-Based Awards for detail concerning the threshold, target and maximum payout opportunities for the named executive officers under the PLM Plan for 2013.

Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs

We believe that long-term incentives are a critical component of our executive compensation program and our LTIP PSUs and LTIP RSUs are the primary vehicle for offering long-term incentives to our top employees. While we do not believe that formal stock ownership guidelines for the named executive officers are appropriate at this time, we believe that equity-based grants provide our top employees, including our named executive officers, with a strong link to our long-term performance, create an ownership culture and help to align the interests of our top employees and our members.

The 2012 LTIP is our primary vehicle for equity-based compensation awards to our employees and covers our senior executives, including the named executive officers. It is designed to retain talented professionals and reward their performance through grants of phantom equity in the form of LTIP RSUs and LTIP PSUs. LTIP RSUs may be granted annually, while LTIP PSUs are generally granted at the beginning of a three-year performance period. Under the terms of the 2012 LTIP, the Compensation Committee also has authority to grant additional LTIP PSU awards to select individuals, including those who are promoted or hired during the three-year performance period. In 2012, the Compensation Committee approved a grant of LTIP PSUs covering the three-year performance period ending in 2014 and in 2013 additional grants of LTIP PSUs were approved for the same performance period. The LTIP RSUs granted in 2012 and 2013 will each vest over three years in one-third increments on the anniversary of their respective grant dates, while the LTIP PSUs granted in 2012, along with the additional LTIP PSUs granted in 2013, will vest at the end of the three-year performance period (in 2014) only if we meet or exceed certain three-year cumulative company performance targets. Concurrent with the adoption of the 2012 LTIP, the Compensation Committee established company performance targets composed of specified levels of cumulative Chrysler Group Modified Operating Profit and cumulative Free Cash Flow for the three-year performance period, ending December 31, 2014. If we do not fully achieve these targets, the LTIP PSUs will be deemed forfeited.

The value of each LTIP RSU and LTIP PSU will be equal to 1/600th of a Class A Membership Interest, on a fully-diluted basis. Prior to a Chrysler Group initial public offering, or IPO, all awards under the 2012 LTIP are settled in cash. After a Chrysler Group IPO, in the Compensation Committee’s discretion, 2012 LTIP awards may be settled in cash or shares of the publicly-traded stock. Settlement will be made as soon as practicable after vesting, but in any case no later than March 15th of the year following vesting provided that the participant has not been terminated for “cause” (as defined in the 2012 LTIP) prior to the established payment date.

In light of the sale of the remaining equity interests of the Company held by VEBA Trust to Fiat, discussed in Note 25,Subsequent Events, of our accompanying audited consolidated financial statements, the Compensation Committee is in the process of evaluating 2014 compensation decisions. As of the date of this filing, the Compensation Committee has not yet made determinations regarding 2014 compensation.

Retirement Benefits

The named executive officers (other than Mr. Marchionne, who did not, in 2013, meet the eligibility requirements for our defined benefit plans and does not receive eligible compensation for purposes of our defined contribution plans) participate in our retirement plans that provide employees with tax-advantaged savings opportunities and income after retirement from the Company on the same terms and conditions as those made available to other eligible U.S. employees, subject to satisfying any eligibility requirements and applicable law.

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Under the Chrysler Group Salaried Employees’ Savings Plan, or the Savings Plan, our tax-qualified defined contribution 401(k) elective savings plan, employees are able to elect to defer a portion of their eligible compensation (up to the limits set by the IRS). For 2013, we did not make a matching contribution to the Savings Plan based on the amount of the employees’ deferrals. We do not currently provide employees, including our named executive officers, with the opportunity to defer any compensation in excess of the amounts that are legally permitted to be deferred under the Savings Plan.

Subject to the satisfaction of age and service requirements, Messrs. Bigland, Manley and Chernoby are eligible for pension benefits under the Chrysler Group LLC Executive Salaried Employees’ Retirement Plan, or Executive Salaried Employees’ Retirement Plan, a contributory tax-qualified defined benefit pension plan, and the Chrysler Group LLC Supplemental Executive Retirement Plan, or Supplemental Executive Retirement Plan, a contributory nonqualified defined benefit pension plan, on the same terms and conditions as offered to other U.S. non-bargaining unit employees hired by Old Carco prior to January 1, 2004. The Executive Salaried Employees’ Retirement Plan and Supplemental Executive Retirement Plan provide a retirement benefit based on years of service and final average salary. For more information regarding the defined benefit pension benefits provided to our named executive officers, see —Compensation of the Named Executive Officers —2013 Pension Benefits below.

Messrs. Marchionne and Palmer are not eligible to participate in the Executive Salaried Employees’ Retirement Plan and the Supplemental Executive Retirement Plan. Mr. Palmer is eligible to participate in the Chrysler Group LLC Employee Managed Retirement Plan, or Employee Managed Retirement Plan, a non-elective tax-qualified defined contribution plan for employees hired by us or by Old Carco after December 31, 2003 and who are not eligible to participate in the Executive Salaried Employees’ Retirement Plan and Supplemental Executive Retirement Plan. Mr. Palmer is also eligible to participate in the Chrysler Executive Employees Supplemental Managed Retirement Plan, or Executive Employees Supplemental Managed Retirement Plan, a noncontributory, nonqualified defined contribution retirement plan, on the same terms and conditions as offered to other U.S. non-bargaining unit employees hired by us or by Old Carco after December 31, 2003. We make an annual contribution to the Employee Managed Retirement Plan and the Supplemental Managed Retirement Plan equal to a fixed percentage of the employee’s compensation. For more information regarding the contribution on behalf of Mr. Palmer to the Employee Managed Retirement Plan and the Supplemental Managed Retirement Plan, see —Compensation of the Named Executive Officers —2013 Summary Compensation Table below. As of December 31, 2013, Mr. Marchionne does not participate in any of our retirement plans.

During the second quarter of 2013, the Compensation Committee amended the Chrysler Group LLC Pension Plan, the Chrysler Group LLC Salaried Employees’ Retirement Plan, and the Executive Salaried Employees’ Retirement Plan, together known as the Salaried Defined Benefit Pension Plans, effective December 31, 2013. Accordingly, benefit accruals under the Salaried Defined Benefit Pension Plans ceased for all participants in the Salaried Defined Benefit Pension Plans, including our named executive officers who previously participated in the Executive Salaried Employees’ Retirement Plan, as of December 31, 2013. For more information regarding changes to the Salaried Defined Benefit Pension Plans and the transition of eligible affected employees to our defined contribution plans, see—Compensation of the Named Executive Officers —2013 Pension Benefits below. At the same time, the Compensation Committee amended the terms of the Employee Managed Retirement Plan so that, effective January 1, 2014, participants in the Salaried Defined Benefit Pension Plans could participate in the Employee Managed Retirement Plan on the same terms as other eligible employees of the Company. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources —Defined Benefit Pension Plans and OPEB Plans —Contributions and Funded Statusand Management’s Discussion and Analysis of Financial Condition and Results of Operations —Critical Accounting Estimates —Pension.

Subject to the satisfaction of retirement and service requirements, our named executive officers are eligible to be provided vehicles under our retired executive officer vehicle policy. Under the policy, a retiring executive officer with ten or more years of service as an executive officer is eligible to be provided with two company vehicles (to be rotated annually) for a period of ten years. The Company will cover the cost of maintenance and repair,

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insurance, licensing and registration fees for the vehicles provided. For more information regarding the retired executive officer vehicle policy, see—Compensation of the Named Executive Officers —Potential Payments upon Termination or Change of Control —Estimated Potential Termination Payments and Benefits.

Other Benefits and Perquisites

The named executive officers are eligible to participate in the Company-sponsored U.S. health and welfare benefit programs for active employees on the same terms and conditions as those made available to U.S. salaried employees or expatriates generally, subject to satisfying any eligibility requirements and applicable law. Basic health benefits, life insurance, disability benefits and similar programs are provided to ensure that employees have access to healthcare and income protection for themselves and their family members.

We provide perquisites for our employees in locales where there is a recognized market practice among our competitors to provide such perquisites. For more information regarding the perquisites provided to our named executive officers, see —Compensation of the Named Executive Officers —2013 Summary Compensation Table below.

Chairman of the Board Compensation

Mr. Marchionne is the Chief Executive Officer of Fiat and Chairman or Chief Executive Officer of several significant business units within Fiat and affiliates of Fiat, including Fiat Group Automobiles, CNH Industrial and Iveco trucks, and elected to receive no direct compensation from Chrysler Group for his services as Chief Executive Officer, President and Chief Operating Officer of Chrysler Group in 2013. His compensation from Fiat is publicly disclosed in Fiat’s annual report.

In July 2013, Mr. Marchionne (as well as all of our non-employee directors other than Mr. Perkins) received a grant of restricted stock units with a grant date fair value of $200,000 for his board service through June 2014 under the Amended and Restated Chrysler Group LLC Directors’ Restricted Stock Unit Plan, or the Director RSU Plan. The restricted stock units will vest on June 10, 2014. Vesting is accelerated upon death or permanent disability, and all unvested awards are forfeited upon cessation of service from the Board. An amount equal to the fair value of the Chrysler Group Units underlying any vested restricted stock units held by a director will be paid within 60 days following the date on which the director ceases to serve as a director. Once vested, the restricted stock units will be settled in cash or, in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. The number of Chrysler Group Units related to outstanding restricted stock units is subject to adjustment by the Compensation Committee in accordance with the terms of the Director RSU Plan. See—Compensation of the Named Executive Officers —2013 Summary Compensation Table for further information on the Mr. Marchionne’s grant of restricted stock units and—Director Compensation —Director Summary Compensation Tablefor further information on restricted stock unit grants to our directors generally.

Process for Compensation Decisions

Role of the Compensation Committee

The Senior Vice President, Human Resources works with our executive compensation team to develop compensation structures and amounts for the named executive officers. These structures and amounts are further refined after being reviewed with the Chief Executive Officer and are then presented to the Compensation Committee for its consideration. In all cases, in accordance with the Compensation Committee’s charter, grants of equity-based awards are approved by the Compensation Committee on or before the date of grant. The Compensation Committee is composed of independent directors with extensive senior executive leadership experience. The Compensation Committee also oversees our leadership development and succession planning programs. Compensation Committee meetings are held at least four times each year and generally are attended

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by internal legal and human resources executives and other top executives as necessary depending upon agenda items, although an executive is not present when the Compensation Committee is discussing such executive’s compensation, as such matters would be addressed in an executive session of the Compensation Committee. The Compensation Committee holds an executive session, members only, at the end of all Compensation Committee meetings.

The Compensation Committee met and determined our 2013 compensation structure in February 2013. The Compensation Committee also met with our senior risk officer, Mr. Palmer, on two separate occasions in 2013, in order to discuss the risk assessment of our compensation arrangements. As a matter of maintaining strong governance and managing risk, the Compensation Committee believes it is important to meet with Mr. Palmer to ensure that our compensation arrangements do not:

• Encourage our employees to take unnecessary and excessive risks that threaten the value of the Company;

• Pose unnecessary risks to the Company; or

• Encourage the manipulation of earnings to enhance compensation.

Based on discussions with Mr. Palmer and review of the compensation arrangements, the Compensation Committee believes that risks inherent in the compensation arrangements are mitigated by the following factors:

• PLM Plan performance metrics are paired (Modified Operating Profit and Free Cash Flow) thereby diversifying the risk associated with any single measure; and fixed maximum award levels limit overall potential payments; and

• The 2012 LTIP ties potential reward to the long-term growth and appreciation in value of the Company.

The Compensation Committee is charged with determining the compensation of our Chief Executive Officer. As described above, Mr. Marchionne, however, has elected to receive no compensation from us for his services as Chief Executive Officer, President and Chief Operating Officer since becoming our Chief Executive Officer in June 2009. As such, no determinations were necessary in 2013.

Compensation Consultants.We engaged Mercer as consultants for certain limited aspects of executive compensation analysis and planning for 2013. In particular, Mercer worked with us to determine the appropriate peer group of companies for benchmark studies of competitive executive compensation and provided data analyses, market assessments, and preparation of related reports. In addition, Mercer reviewed competitive market data for compensation analyses we had used to assist in establishing compensation for salaried employees at all levels of the Company. In 2013, Mercer did not attend Compensation Committee meetings in its capacity as advisor to us.

During 2013, we paid Mercer $52,638 in consulting fees directly related to executive compensation services performed for us. An additional $18,096 was paid to Mercer for consulting services performed on behalf of the Compensation Committee. We also paid Mercer $545,216 in consulting fees in 2013 for services unrelated to executive compensation, such as consulting related to healthcare, global mobility, employee relations, and retirement and savings plans. The Mercer team performing executive compensation services for us operated separately from and independently of the Mercer team performing services unrelated to executive compensation.

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Consideration of Competitive Compensation Levels

The Compensation Committee believes that use of a compensation peer group is the most effective method for providing a competitive market context as the Compensation Committee evaluates and sets the compensation needed to attract, motivate and retain the executive talent needed to manage our businesses and operations successfully. For 2013, the Compensation Committee considered compensation information compiled by Mercer, the independent compensation consultant retained by us, based on a wide range of large companies. A compensation peer group of 28 companies was selected based on their annual revenues (annual revenues ranged from $21.6 billion to $216.9 billion, with average revenue of $63.3 billion), complexity of business operations, and global span of business enterprises. Mercer assisted us in selecting the compensation peer group by gathering relevant financial and business data for companies being considered for inclusion in the peer group and then by providing the Compensation Committee with recommendations for peer group members. In consultation with Mercer, the following criteria were established and used in the selection of the recommended peer group:

• Identify a group of companies that:

• represent our labor market for executive talent;

• yield valid compensation comparisons (based on size and business characteristics); and

• have positions similar to ours.

• Criteria used to identify appropriate peers included:

• revenue scope;

• durable manufacturing as at least a portion of their business;

• engineering focus;

• consumer/brand focus;

• less than 50 percent in foreign sales; and

• participation in well-established compensation surveys.

The 2013 compensation peer group is composed of 28 companies with 7 new companies being added and 10 companies being removed compared to 2012. For 2013, the compensation peer group consisted of the following companies:

3M Company	General Dynamics Corporation	Northrop Grumman Corporation
The Boeing Company	General Electric Company	PepsiCo, Inc.
Alcoa Inc.	General Motors Company	Pfizer Inc.
Caterpillar Inc.	Goodyear Tire & Rubber Company	The Procter & Gamble Company
Chevron Corporation	Hewlett-Packard Company	Raytheon Company
Deere & Company	Honeywell International Inc.	United Technologies Corporation
Dell Inc.	International Business Machines Corporation	Whirlpool Corporation
The Dow Chemical Company	Johnson & Johnson	Xerox Corporation
E. I du Pont de Nemours & Company	Johnson Controls, Inc.
Ford Motor Company	Lockheed Martin Corporation

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In November 2013, in consultation with Mercer, the Compensation Committee approved a revised compensation peer group for use in 2014. Chevron Corporation, E.I. du Pont de Nemours & Company, Alcoa Inc., and Dell Inc. were removed from the peer group and ConocoPhillips Company was added.

Deductibility of Executive Compensation and Other Tax Considerations

Compensation related to services performed during 2013 is not subject to Section 162(m) of the Internal Revenue Code as we were not a publicly held corporation as defined in the statute. However, we do take into account certain other tax considerations, including Section 409A of the Internal Revenue Code, which governs the form and time of payment of nonqualified deferred compensation, and could result in significant additional taxes and penalties on a recipient of nonqualified deferred compensation that does not comply with Section 409A.

Accounting Considerations

In making decisions about executive compensation, we also consider how various elements of compensation will affect our financial reporting. For example, we consider the impact of the accounting guidance related to share-based compensation, which requires us to recognize the cost of employee services received in exchange for awards of equity instruments based upon the grant date fair value of those awards.

Other Polices and Considerations

Recovery of Incentive Awards

We maintain a clawback policy. Under the policy, all cash and equity incentive compensation payable to our leadership team, including the named executive officers, is subject to clawback if it is later determined that the Company’s financial statements need to be restated, regardless of whether such restatement resulted from an executive’s fraud or misconduct. In such circumstances, the Company may cancel any equity award and claw back any bonus or other incentive compensation if such award, bonus or compensation was tied to the achievement of company financial objectives. The policy will be applied at the discretion of the Compensation Committee.

Severance Policy

We maintain a plan that provides severance benefits to a broad group of our employees, which we refer to as the Termination Allowance Plan. Our named executive officers may be eligible for severance benefits under our Termination Allowance Plan. See —Compensation of the Named Executive Officers —Potential Payments upon Termination or Change of Control, below, for additional discussion of the Termination Allowance Plan.

Stock Ownership Guidelines and No-Hedging Policy

We do not have formal stock ownership guidelines in place for our named executive officers at this time since we do not believe they are appropriate while we are a private company. We do, however, believe that a culture of ownership within our executive group is paramount to our long-term success, and, as such, provide a portion of our named executive officers’ total compensation in the form of equity-based awards the value of which is determined by reference to the value of our Class A Membership Interests. As our membership interests are not currently publicly traded, there is not an active market for Company derivative securities, and, as such, a no-hedging policy is not necessary.

Conclusion

Our success depends on the appropriate alignment of interests among all of our stakeholders. As such, management and the Compensation Committee continue to work to design and implement compensation programs that will recognize the contributions of our employees and will attract new employees to the Company.

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Compensation of the Named Executive Officers

The following tables contain compensation information for our Chief Executive Officer, Chief Financial Officer and our three most highly paid executive officers, other than our Chief Executive Officer and Chief Financial Officer, who were serving as our executive officers on December 31, 2013. These officers are referred to as the “named executive officers.” All dollar amounts are in USD. See —Compensation Discussion and Analysis, above, for additional details regarding our compensation practices.

2013 Summary Compensation Table

Name and Principal Position	Year		Salary (1) ($)		Bonus (2) ($)		Stock Awards (3) ($)		Stock Option Awards ($)(4)		Non-Equity Incentive Plan Compensation ($) (5)		Change in Pension Value and Nonqualified Deferred Compensation Earnings(6) ($)		All Other Compensation (7) ($)		Total ($)
Sergio Marchionne		2013		—		—		200,000		—		—		—		107,989		307,989
Chairman, Chief Executive		2012		—		—		200,006		929,030		—		—		102,366		1,231,402
Officer, President and Chief Operating Officer		2011		—		—		—		—		—		—		—		—
Richard K. Palmer		2013		766,671		162,490		515,632		—		387,510		—		271,935		2,104,238
Senior Vice President and		2012		650,004		61,880		2,315,636		—		412,500		—		272,582		3,712,602
Chief Financial Officer		2011		537,504		—		627,500		—		—		—		298,637		1,463,641
Reid A. Bigland		2013		610,004		142,490		192,195		—		307,510		296,402		9,265		1,557,866
Senior Vice President, Head of U.S. Sales and Head of Ram Truck Brand; President and Chief Executive Officer of Chrysler Canada Inc.
Michael Manley		2013		610,004		142,490		176,814		—		307,510		353,207		14,400		1,604,425
Senior Vice President—		2012		610,004		50,750		1,883,450		—		338,250		234,521		14,400		3,131,375
International and Head of Jeep Brand		2011		460,004		—		508,402		—		—		104,008		15,550		1,087,964
Mark M. Chernoby		2013		650,008		45,000		157,500		—		300,010		1,096,984		7,943		2,257,445
Senior Vice President — Engineering; Vice President — Product Committee Coordinator

(1) Mr. Marchionne is the Chief Executive Officer of Fiat and Chairman or Chief Executive Officer of several significant business units within and affiliates of Fiat, including Fiat Group Automobiles, CNH Industrial and Iveco trucks and did not receive direct compensation from us for his services to Chrysler Group in 2013, other than for his services as a director. Mr. Marchionne’s compensation from Fiat is publicly disclosed in Fiat’s annual report. Mr. Palmer received base pay increases in 2013 which reflected prevailing market salaries for similar positions and his transition from expatriate status to local employee status in the United States.

(2) A cash award under the PLM Plan was paid in February, 2014 with respect to the 2013 performance year with the amount based on the extent to which the Company achieved or exceeded its performance targets related to Modified Operating Profit and Free Cash Flow and the individual’s contribution and leadership during the 2013 performance year. The amounts in this column represent the portion of the award under the PLM Plan based on the named executive officer’s individual performance during the 2013 performance year. See note (5), below,—Compensation Discussion and Analysis —Compensation Components —Cash Award under the PLM Plan and—2013 Grants of Plan-Based Awards for additional disclosure regarding the PLM Plan and payouts thereunder.

(3) The amounts reported in this column represent the grant date fair value of the DPSs, restricted stock units, LTIP PSUs and LTIP RSUs which represent the right to receive the value of Chrysler Group Units, granted to each of the named executive officers, calculated in accordance with the accounting guidance related to share-based compensation. That value is calculated by multiplying the fair value per Chrysler Group Unit, as described in —Compensation Discussion and Analysis —Compensation Components —Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs, above, as of the grant date of the award (determined in accordance with the accounting guidance related to share-based

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compensation) by the number of Chrysler Group Units related to the DPSs, restricted stock units, LTIP PSUs and LTIP RSUs. For a discussion of how the value of a Chrysler Group Unit was determined, seeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Critical Accounting Estimates —Share-Based Compensation above. A portion of the value of the equity-based awards granted to Mr. Palmer were LTIP PSUs, granted by the Compensation Committee in connection with his transition from expatriate status to local employee status in the United States, effective December 1, 2013. See —Compensation Discussion and Analysis —Compensation Components —Cash Base Salary,above, and —2013 Grants of Plan-Based Awardsbelow.

Regardless of the value on the grant/vesting date, the actual value will depend on the fair value of our Class A Membership Interests on a date in the future when an award vests or is paid. For a discussion of the LTIP RSUs, and LTIP PSUs shares granted to each of the named executive officers as compensation in 2013, see —Compensation Discussion and Analysis —Compensation Components —Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs above and—2013 Grants of Plan-Based Awards below.

With respect to Mr. Marchionne, the amount reported in “Stock Awards” column for 2013 represents the grant date fair value of the restricted stock units he received for his service as a director from June 2013 through June 2014. For a discussion of the restricted stock units awarded to Mr. Marchionne in 2013, see —Compensation Discussion and Analysis —Compensation Components —Chairman of the Board Compensation above.

The following provides additional detail regarding the amounts reported in the “Stock Awards” column of the 2013 Summary Compensation Table for the year ended December 31, 2013:

Name	Directors’ Restricted Stock Units ($)		LTIP RSUs ($)		LTIP PSUs ($)		Total Stock Awards ($)
Sergio Marchionne		200,000		—		—		200,000
Richard K. Palmer		—		215,631		300,001		515,632
Reid A. Bigland		—		192,195		—		192,195
Michael Manley		—		176,814		—		176,814
Mark M. Chernoby		—		157,500		—		157,500

(4) The amount reported in this column represents the grant date fair value of the UAR Award awarded to Mr. Marchionne for his service as a director. The estimate of the grant date fair value was calculated using a Black-Scholes option pricing model. Upon exercise, the UAR Award will provide Mr. Marchionne with a payment equal to the increase, if any, in the value of a Chrysler Group Unit above the reference price per unit of $7.99. The fair value of a Chrysler Group Unit is based on the fair value of our membership interests as determined using a discounted cash flow methodology. Refer to Note 17, Share-Based Compensation, of our accompanying audited consolidated financial statements for additional information.

(5) The amounts reported in this column represent the portion of the cash award under the PLM Plan paid in February 2014 with respect to the 2013 performance year based on the extent to which the Company achieved or exceeded its performance targets related to Modified Operating Profit and Free Cash Flow. See note (2), above,—Compensation Discussion and Analysis —Compensation Components —Cash award under the PLM Plan and —2013 Grants of Plan-Based Awardsfor additional disclosure regarding the PLM Plan and payouts thereunder.

(6) The amounts reported in this column represent the increase in the present value of the accrued defined benefit pension benefits for each named executive officer, including those accrued under the Executive Salaried Employees’ Retirement Plan and Supplemental Executive Retirement Plan. No amount is included with respect to nonqualified deferred compensation earnings, because there were no above-market earnings on nonqualified deferred compensation. Messrs. Marchionne and Palmer are not eligible to participate in the defined benefit pension plans. The amounts reported for 2013 are determined by subtracting (i) the present value of each named executive officer’s accrued benefits as of December 31, 2012 from (ii) the present value of such named executive officer’s accrued benefits as of December 31, 2013, which are reported in the Pension Benefits table below, and are computed in the manner explained in the narrative disclosure to the Pension Benefits table. This increase in present value is not a current cash payment, since pension benefits are paid only after retirement, but represents the change in the value of the named executive officers’ pension benefits over the previous year-end because: (i) an additional year of contributory service was included in the computation of pension benefits under the Executive Salaried Employees’ Retirement Plan and the Supplemental

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Executive Retirement Plan; (ii) the “final average earnings” used in the computation of the pension benefits increased over the “final average earnings” used in the computation of the pension benefits as of the previous fiscal year-end; and (iii) the normal retirement age, the assumed commencement age of benefits, was one year closer. The present value of the accrued defined benefit pension benefits can also increase or decrease in value due to changes in actuarial assumptions. For Mr. Manley, the amount reported in our Annual Report on Form 10-K filed on March 7, 2013 as the increase in the present value of the accrued defined benefit pension benefits for 2012 has been revised, from $148,042 to $234,521, to correct an actuarial error in the 2012 calculation. Between December 31, 2012 and December 31, 2013, the discount rate used to determine benefit obligations changed from 4.00% to 4.70%, which had the effect of decreasing the present value. One demographic assumption was changed, the assumed retirement age. Since the Chrysler Group LLC Executive Salaried Employees’ Retirement Plan and Chrysler Group LLC Pension Plan have been amended to allow unreduced benefits at age 58 for retirements after January 1, 2014, we have changed the assumed retirement age from 62 to 58. No other actuarial assumptions changed between December 31, 2012 and December 31, 2013.

(7) The amounts reported in this column include the incremental cost to us of providing the perquisites and other benefits received by our named executive officers, as well as contributions on behalf of Mr. Palmer to the Employee Managed Retirement Plan and the Supplemental Managed Retirement Plan, in each case without taking into account the value of any income tax deduction for which Chrysler Group is eligible. Incremental costs to Chrysler Group for these items were determined as the actual amounts credited to or paid to or on behalf of the named executive officers. The following table provides additional detail regarding the amounts reported in the “All Other Compensation” column of the 2013 Summary Compensation Table for the year ended December 31, 2013:

Name	Company Vehicle Programs (a) ($)		Financial Counseling (b) ($)		Tax Preparation Services(b) ($)		Medical Evaluations (c) ($)		Housing Expenses/ Security/ Expatriate Allowances (d) ($)		EMRP Contributions (e) ($)		Total All Other Compensation ($)
Sergio Marchionne		—		—		4,075		—		103,914		—		107,989
Richard K. Palmer		6,900		9,186		1,069		1,438		187,753		65,589		271,935
Reid A. Bigland		6,900		—		1,115		1,250		—		—		9,265
Michael Manley		6,900		7,500		—		—		—		—		14,400
Mark M. Chernoby		6,900		—		—		1,043		—		—		7,943

(a) The amounts reported in this column represent the incremental cost to us for one product evaluation vehicle and one company furnished vehicle. We calculate the incremental cost of providing our vehicles by comparing the cost of production against the value received upon the disposal of the vehicle plus the cost of maintenance and repair, insurance, licensing and registration fees. The cost of the product evaluation vehicle also includes fuel. Participants in the product evaluation vehicle program are required to evaluate the vehicle, thus providing feedback about our products. The named executive officers were taxed on the imputed income attributed to personal use of the company furnished vehicle and did not receive tax assistance from us.

(b) The amounts reported in these columns represent the incremental costs to us associated with either (i) financial counseling and estate planning services or (ii) tax preparation services. The named executive officers are permitted to elect either financial counseling and estate planning services or tax preparation services provided by one of several vendors approved by us. We paid tax preparation fees on behalf of Mr. Palmer related to his status as an expatriate. This and other expatriate benefits ceased in connection with Mr. Palmer’s transition to local employee status in the United States, effective December 1, 2013. The named executive officers are taxed on the imputed income attributed to such services and do not receive tax assistance from us.

(c) The amounts reported in this column represent the incremental costs to us for medical services incurred by us in connection with providing executive health evaluations with one of several providers approved by us.

(d) Mr. Marchionne’s principal place of business is not our Auburn Hills, Michigan headquarters. However, Mr. Marchionne purchased a residence near our corporate headquarters in Auburn Hills, Michigan to use when he is there on business. We provide security for such residence at an incremental cost to the Company of $2,157. In addition, we reimburse Mr. Marchionne for a portion of the expenses he incurs related to the costs of maintaining his Michigan residence, including cleaning, utility services, insurance, and other expenses at a total incremental cost to the Company of $101,757. In connection with his relocating to our corporate headquarters, Mr. Palmer received standard expatriate benefits under the terms of our international expatriate assignment policy, including housing, home leave, tax protection and educational assistance, which are reported in this column. As discussed above in —Compensation Discussion and Analysis —Compensation Components —Cash Base Salary, these expatriate benefits ceased in connection with Mr. Palmer’s transition to local employee status in the United States, effective December 1, 2013.

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(e) We make contributions to Mr. Palmer’s accounts under the Employee Managed Retirement Plan and the Supplemental Managed Retirement Plan equal to the sum of five percent of his monthly salary and, once his salary exceeds 75 percent of the Social Security wage base ($113,700 in 2013), four percent of the excess of his monthly salary over 75 percent of the Social Security wage base. Only salary up to the IRS’s covered compensation limit ($255,000 in 2013) is taken into account for this purpose with respect to the Employee Managed Retirement Plan. Contributions related to compensation in excess of the IRS’s covered compensation limit are made to the Supplemental Managed Retirement Plan.

2013 Grants of Plan-Based Awards

The following sets forth information about the non-equity incentive awards and equity-based awards granted by us to each of our named executive officers in 2013.

Name	Award Type (1)	Grant Date		Approval Date(2)		Estimated Future Payouts Under Non-Equity Incentive Plan Awards						Estimated Future Payouts Under Equity Incentive Plan Awards						All Other Stock Awards: Number of Shares of Stock or Units (#)		All Other Option Awards: Number of Securities (#)		Exercise or Base Price of Option Awards ($/ Share) ($)		Grant Date Fair Value of Stock and Option Awards (4) ($)
						Threshold ($)(3)		Target ($)(3)		Maximum ($)(3)		Threshold (#)		Target (#)		Maximum (#)
Sergio Marchionne	Director’s Restricted Stock Units		7/30/2013		7/30/2013		—		—		—		—		20,161.29		—		—		—		—		200,000
															Total: 20,161.29										Total: 200,000
Richard K. Palmer	LTIP PSU		12/1/2013		11/19/2013		—		—		—		—		30,242.00		—		—		—		—		300,001
	LTIP RSU		2/26/2013		2/26/2013		—		—		—		—		23,959.00		—		—		—		—		215,631
															Total: 54,201.00										Total: 515,632
	PLM Plan		—		2/26/2013		193,760		387,510		581,260
Reid A. Bigland	LTIP RSU		2/26/2013		2/26/2013		—		—		—		—		21,355.00		—		—		—		—		192,195
															Total: 21,355.00										Total: 192,195
	PLM Plan		—		2/26/2013		153,760		307,510		461,260
Michael Manley	LTIP RSU		2/26/2013		2/26/2013		—		—		—		—		19,646.00		—		—		—		—		176,814
															Total: 19,646.00										Total: 176,814
	PLM Plan		—		2/26/2013		153,760		307,510		461,260
Mark M. Chernoby	LTIP RSU		2/26/2013		2/26/2013		—		—		—		—		17,500.00		—		—		—		—		157,500
															Total: 17,500.00										Total: 157,500
	PLM Plan		—		2/26/2013		150,010		300,010		450,010

(1) Types of Awards: Directors’ Restricted Stock Units: restricted stock units granted under the Director RSU Plan; LTIP PSU: long-term incentive plan performance share units granted under the 2012 LTIP; LTIP RSU: long-term incentive plan restricted share units granted under the 2012 LTIP; and PLM Plan: cash awards under the Chrysler Group LLC PLM Plan. For a description of the plans, including the determination of value of the directors’ restricted stock units, restricted stock units, LTIP PSUs and LTIP RSUs, see —Compensation Discussion and Analysis —Compensation Components —Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs, —Compensation Discussion and Analysis —Compensation Components —Cash Award under the PLM Plan and —Compensation Discussion and Analysis —Compensation Components —Chairman of the Board Compensationabove. Prior to a Chrysler Group IPO, payments under the plans are made in cash based on the fair value of a Chrysler Group Unit as of the most recently completed valuation at the time payment is made. On or after a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock.

(2) On February 26, 2013, the Compensation Committee approved grants of LTIP RSUs to our named executive officers (other than Mr. Marchionne) and threshold, target and maximum awards under the PLM Plan related to 2013 for our named executive officers (other than Mr. Marchionne). On July 30, 2013, the Compensation Committee approved grants of restricted stock units to the members of the Board, including Mr. Marchionne. On November 19, 2013, the Compensation Committee approved a grant of LTIP PSUs to Mr. Palmer in connection with his transition from expatriate status to local employee status in the United States, effective December 1, 2013.

(3) The amounts reported in these columns represent the threshold, target and maximum, as applicable, amounts payable under the PLM Plan for 2013. The actual awards to be paid to our named executive officers in 2014 for performance

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related to 2013 pursuant to the PLM Plan are included in the Non-Equity Incentive Plan Compensation column in —Compensation of the Named Executive Officers —2013 Summary Compensation Table above. All of the estimated payouts presented in this table assume that the named executive officer’s individual performance does not merit any further upward or downward adjustment to the amount of the award payable based on company performance. For further discussion of awards to our named executive officers under the PLM Plan, see —Compensation Discussion and Analysis —Compensation Components —Cash Award under the PLM Plan.

(4) The amounts reported in this column represent the grant date fair value of the directors’ restricted stock units, LTIP PSUs and LTIP RSUs granted to each of the named executive officers in 2013 (calculated in accordance with the accounting guidance related to share-based compensation) multiplied by the number of Chrysler Group Units related to the directors’ restricted stock units, LTIP PSUs and LTIP RSUs awarded. Regardless of the value on the grant/vesting date, the actual value will depend on the fair value of our Class A Membership Interests on a date in the future when an award vests or is paid. For a discussion of the directors’ restricted stock units, restricted stock units, LTIP PSUs and LTIP RSUs granted to each of the named executive officers as compensation in 2013, see —Compensation Discussion and Analysis —Compensation Components —Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs, and —Compensation Discussion and Analysis —Compensation Components —Chairman of the Board Compensationabove.

Outstanding Equity Awards at December 31, 2013

The following sets forth information about the outstanding equity-based awards held by each of our named executive officers as of December 31, 2013.

	Option Awards(1)												Stock Awards(2)
Name	Grant Date		Number of Securities Underlying Unexercised Options (#) Exercisable (#)		Number of Securities Underlying Unexercised Options (#) Unexercisable (#)		Equity Incentive Plan Award: Number of Securities Underlying Unexercised Unearned Options (#)		Option Exercise Price ($)		Option Expiration Date (#)		Number of Shares or Units of Stock That Have Not Vested (3)(4) (#)		Market Value of Shares or Units of Stock That Have Not Vested(5) ($)		Equity Incentive Plan Awards: Number of Unearned Shares, Units, or Other Rights That Have Not Vested(4)(6) (#)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units, or Other Rights That Have Not Vested(5) ($)
Sergio Marchionne		7/30/2013		—		—		—		—		—		20,161.29		211,089		—		—
		12/3/2012		—		499,478.5		—		7.99		12/3/2022		—		—		—		—
Richard K. Palmer		12/1/2013		—		—		—		—		—		—		—		30,242.00		316,634
		2/26/2013		—		—		—		—		—		23,959.00		250,851		—		—
		2/23/2012		—		—		—		—		—		—		—		221,167.00		2,315,618
		2/23/2012		—		—		—		—		—		20,479.00		214,415		—		—
		1/30/2012		—		—		—		—		—		51,606.00		540,315		—		—
		1/20/2011		—		—		—		—		—		59,100.70		618,784		—		—
Reid A. Bigland		2/26/2013		—		—		—		—		—		21,355.00		223,587		—		—
		2/23/2012		—		—		—		—		—		—		—		181,357.00		1,898,808
		2/23/2012		—		—		—		—		—		16,793.00		175,823		—		—
		1/30/2012		—		—		—		—		—		31,947.00		334,485		—		—
		1/20/2011		—		—		—		—		—		26,602.80		278,531		—		—
Michael Manley		2/26/2013		—		—		—		—		—		19,646.00		205,694		—		—
		2/23/2012		—		—		—		—		—		—		—		181,357.00		1,898,808
		2/23/2012		—		—		—		—		—		15,450.00		161,762		—		—
		1/30/2012		—		—		—		—		—		42,317.00		443,059		—		—
		1/20/2011		—		—		—		—		—		47,393.30		496,208		—		—
Mark M. Chernoby		2/26/2013		—		—		—		—		—		17,500.00		183,225		—		—
		2/23/2012		—		—		—		—		—		—		—		154,817.00		1,620,934
		2/23/2012		—		—		—		—		—		14,336.00		150,098		—		—
		1/30/2012		—		—		—		—		—		30,882.00		323,335		—		—
		1/20/2011		—		—		—		—		—		31,327.40		327,998		—		—

(1) The amounts reported in these columns reflect the UAR Award granted by the Board to Mr. Marchionne in connection with his Board service. The UAR Award was granted in respect of the 499,478.5 Chrysler Group Units originally subject to his DPS grant, with a reference price per unit of $7.99 equal to the fair market value per unit at which the DPSs were settled. Similar to the equity-based compensation granted to other Board members, the UAR Award may be exercised by Mr. Marchionne only upon termination of his Board service (or if earlier, the tenth anniversary of the UAR Award), and

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at exercise will provide Mr. Marchionne with a payment equal to the increase, if any, in the value of a Chrysler Group Unit since the UAR Award grant date.

(2) The amounts reported in these columns reflect restricted stock units granted, in the case of Mr. Marchionne, under the Director RSU Plan, and in the case of all other named executive officers, restricted stock units granted under the RSU Plan, LTIP PSUs and LTIP RSUs under the 2012 LTIP. On September 22, 2011, in accordance with the terms of the RSU Plan, the number of restricted stock units was adjusted to preserve the economic value of the awards and offset the dilutive effect of changes in Fiat’s ownership interest. Refer to Note 17,Share-Based Compensation, of the accompanying audited consolidated financial statements for additional information.

(3) The restricted stock units reported in this column, include 2011 restricted stock units and 2012 restricted stock units, which will vest if the holder is continuously employed by us through the third anniversary of the grant date and LTIP RSUs which will vest over three years in one-third increments on the anniversary of their grant date.

(4) If the holder retires on or after the second anniversary of grant, then such holder will continue to be considered employed for vesting purposes for 2011 restricted stock units and 2012 restricted stock units. For purposes of all restricted stock units, the holder will be treated as having retired upon a termination of employment after reaching age 55 and completing 10 years of service with us or a predecessor company (or after satisfying other applicable retirement criteria). All unvested restricted stock units will become fully vested upon the holder’s death or permanent disability. Unvested restricted stock units as of the date of termination are forfeited. Payment of 2011 restricted stock units granted in January 2011 and 2012 restricted stock units granted in January 2012 was to be no later than March 15 of the year following the year in which they vest. Once vested, the restricted stock units will be settled in cash or, in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. Payment for vested restricted stock units will be made regardless of employment status at the time of the scheduled payment. The number of Chrysler Group Units related to outstanding restricted stock units is subject to adjustment by the Compensation Committee in accordance with the terms of the RSU Plan. For LTIP RSUs and LTIP PSUs, once vested, they will be settled in cash or, in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. Settlement will be made as soon as practicable after vesting, but in any case no later than March 15th of the year following vesting. Vesting of the LTIP RSUs and LTIP PSUs may be accelerated in certain circumstances, including upon the participant’s death, disability or in the event of a change of control.

(5) The fair value of unvested restricted stock units, directors’ restricted stock units, LTIP RSUs and LTIP PSUs was $10.47 per Chrysler Group Unit as of December 31, 2013, which is based on the fair value of our membership interests as determined using a discounted cash flow methodology. Refer to Note 17, Share-Based Compensation, of our accompanying audited consolidated financial statements for additional information.

(6) The LTIP PSUs reported in this column will vest at the end of the three-year performance period only if we meet or exceed certain three-year cumulative company performance targets. Concurrent with the adoption of the 2012 LTIP, the Compensation Committee established company performance targets composed of specified levels of cumulative Modified Operating Profit and cumulative Free Cash Flow for the three-year performance period ending December 31, 2014. If we do not fully achieve these targets, the LTIP PSUs will be deemed forfeited.

Options Exercised and Stock Vested in 2013

The following sets forth information about the value realized by each of our named executive officers as a result of the exercise of stock options or upon the vesting of equity awards in 2013.

	Option Awards				Stock Awards
Name	Number of Shares Acquired on Exercise (#)		Value Realized on Exercise ($)		Number of Shares Acquired on Vesting(1) (#)		Value Realized on Vesting(2) ($)
Sergio Marchionne		—		—		25,032.00		225,288
Richard K. Palmer		—		—		71,424.90		642,824
Reid A. Bigland		—		—		21,079.00		189,711
Michael Manley		—		—		29,176.50		262,589
Mark M. Chernoby		—		—		21,441.90		192,977

(1) The number of shares reported in this column represents restricted stock units granted in 2010 and restricted share units granted under the 2012 LTIP vesting in 2013. The restricted stock units granted in 2010 vest if the holder was

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continuously employed by us through the third anniversary of the grant date. Accordingly, these restricted stock units vested in March 2013. The restricted share units granted under the 2012 LTIP vest over three years in one-third increments on the anniversary of their grant date. Accordingly, one third of the restricted share units granted under the 2012 LTIP in 2012 vested in February 2013. Once vested, the restricted stock units and restricted share units granted under the 2012 LTIP will be settled in cash or, in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. Payment for vested restricted stock units will be made regardless of employment status at the time of the scheduled payment. With respect to Mr. Marchionne, the number of shares reported in this column represents restricted stock units granted pursuant to the Director RSU Plan in 2012. These restricted stock units vest on June 10 of the year following the year in which they were granted. Accordingly, the restricted stock units reported in this column vested on June 10, 2013. These restricted stock units will be paid within 60 days following the date on which Mr. Marchionne ceases to serve as a director. Once vested, these restricted stock units will be settled in cash, or in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. For additional information regarding restricted stock units held by the named executive officers as of December 31, 2013 under the RSU Plan, see —Compensation of the Named Executive Officers — Outstanding Equity Awards at December 31, 2013 above.

The following table provides detail regarding the types of awards reported in the “Number of Shares Acquired on Vesting” and “Value Realized on Vesting” columns of the “Options Exercised and Stock Vested in 2013” table:

	Stock Awards
Name	Number of Shares Acquired on Vesting (#)		Value Realized on Vesting ($)
Sergio Marchionne
Directors’ Restricted Stock Units		25,032.00		225,288
Richard K. Palmer
2010 Restricted Stock Units		61,185.90		550,673
2012 LTIP RSUs —1ST TRANCHE		10,239.00		92,151
Reid A. Bigland
2010 Restricted Stock Units		12,683.00		114,147
2012 LTIP RSUs —1ST TRANCHE		8,396.00		75,564
Michael Manley
2010 Restricted Stock Units		21,452.50		193,073
2012 LTIP RSUs —1ST TRANCHE		7,724.00		69,516
Mark M. Chernoby
2010 Restricted Stock Units		14,274.90		128,474
2012 LTIP RSUs —1ST TRANCHE		7,167.00		64,503

(2) The amount reported as value realized upon vesting of restricted stock units is calculated by multiplying the fair value per Chrysler Group Unit (as described under the caption —Compensation Discussion and Analysis —Compensation Components —Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs above) as of the vesting date of the award (determined in accordance with the accounting guidance related to share-based compensation) by the number of Chrysler Group Units related to the restricted stock units awarded. Regardless of the value on the grant/vesting date, the actual value will depend on the fair value of our Class A Membership Interests on a date in the future when the restricted stock units are paid.

2013 Pension Benefits

Subject to the satisfaction of age and service requirements, Messrs. Bigland, Manley and Chernoby are eligible for pension benefits under the Executive Salaried Employees’ Retirement Plan and the Supplemental Executive Retirement Plan, each described below, on the same terms and conditions as offered to other U.S. non-bargaining unit employees hired prior to January 1, 2004.

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The benefit under the Executive Salaried Employees’ Retirement Plan is computed as a monthly annuity benefit on a 10-year certain and life basis beginning as early as age 62 equal to:

• “final average earnings” times 2.25 percent of the executive’s years of contributory service (starting at age 35), up to a maximum of 20 years;

plus

• “final average earnings” times two percent of the executive’s years of contributory service (starting at age 35) in excess of 20 years for the next 8.5 years;

minus

• 50 percent of the age 62 Social Security benefits.

For these purposes, “final average earnings” is defined as the highest average base pay up to the IRS’s covered compensation limit ($255,000 in 2013) during any consecutive five years out of the last 15 years of employment.

The pension benefit under the Executive Salaried Employees’ Retirement Plan for an executive whose employment terminates after reaching age 55 but before reaching age 62 is reduced by approximately six percent for each year by which the executive’s age at termination is less than age 62. In order to receive a pension benefit under the Executive Salaried Employees’ Retirement Plan, a participant must complete one year of service and attain age 65, or complete 10 years of service and attain age 55, except that death benefits are paid if the participant dies after starting to contribute and disability benefits are paid if the participant becomes disabled after completing five years of contributory service after attaining age 35.

During the second quarter of 2013, in connection with the amendment of our Salaried Defined Benefit Pension Plans as described inRetirement Benefits, above, and in order to transition the Salaried Defined Benefit Pension Plan participants to our defined contribution plans, the Compensation Committee enhanced the retirement factors in our Salaried Defined Benefit Pension Plans to allow retirement eligible participants who retire or terminate employment on or after January 1, 2014, including our named executive officers who participate in the Salaried Defined Benefit Pension Plans, to receive 100 percent of their accrued benefit commencing at age 58. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources —Defined Benefit Pension Plans and OPEB Plans —Contributions and Funded Status —Defined Benefit Pension Plans —Funded Statusand Management’s Discussion and Analysis of Financial Condition and Results of Operations —Critical Accounting Estimates —Pension.

The Supplemental Executive Retirement Plan is a restorative supplemental retirement plan that provides a pension benefit computed using the same formula (including the definition of final average earnings) as the formula under the Executive Salaried Employees’ Retirement Plan except that: (i) base pay is not limited by the IRS’s covered compensation limit; and (ii) the benefit is offset by amounts paid from the Executive Salaried Employees’ Retirement Plan. Each U.S. non-bargaining unit employee hired prior to January 1, 2004 is eligible for a benefit under the Supplemental Executive Retirement Plan if his or her covered compensation exceeds the IRS’s covered compensation limit. As a result of the Special Master for TARP Executive Compensation’s determinations, no additional amounts were permitted to accrue under the Supplemental Executive Retirement Plan for the top 25 most highly compensated employees, including our named executive officers, attributable to salary and years of service during the period under which we were subject to TARP restrictions. In addition, after December 31, 2013, there will be no further accruals under the Supplemental Executive Retirement Plan as a result of the amendments to our Executive Salaried Employees’ Retirement Plan.

The amounts reported in the column “Present Value of Accumulated Benefit” represent the benefits that the named executive officers have earned, based on their service and compensation through December 31, 2013, but assuming

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that he retires at the earliest date on which he may retire without a reduction in pension benefit (age 58 if he retires or terminates employment on or after January 1, 2014). None of the named executive officers eligible for pension benefits has attained the age necessary to receive an unreduced pension benefit. While a present value is reported in the table, tax-qualified pension benefits are not available as a lump sum and must be taken in the form of an annuity. However, any nonqualified pension benefits due to base pay being limited by the IRS’s covered compensation limit ($255,000 in 2013) or due to the limits imposed by Section 415 of the Internal Revenue Code are paid out in a lump sum. We used the same assumptions in computing the amounts reported as we use for financial reporting purposes, including a discount rate of 4.70 percent and mortality according to the 2007 Chrysler Plan Specific Mortality Table for non-bargaining unit employees, projected generationally with Scale AA. For a discussion of the actuarial assumptions used to calculate the present values, see Note 18,Employee Retirement and Other Benefits, to our accompanying audited financial statements included in this prospectus.

The following provides information as of December 31, 2013 with respect to our defined benefit pension plans in which our named executive officers participated.

Name	Plan Name	Number of Credited Service Years (#)		Present Value of Accumulated Benefit ($)		Payments During Last Fiscal Year ($)
Sergio Marchionne (1)	—		—		—		—
Richard K. Palmer (1)	—		—		—		—
Reid A. Bigland	Chrysler Group LLC Executive Salaried Employees’ Retirement Plan		7.42		322,169		—
	Chrysler Group LLC Supplemental Executive Retirement Plan		7.42		362,011		—
Michael Manley	Chrysler Group LLC Executive Salaried Employees’ Retirement Plan		6.58		351,790		—
	Chrysler Group LLC Supplemental Executive Retirement Plan		6.58		387,388		—
Mark M. Chernoby	Chrysler Group LLC Executive Salaried Employees’ Retirement Plan		30.50		1,142,258		—
	Chrysler Group LLC Supplemental Executive Retirement Plan		30.50		1,246,052		—

(1) Messrs. Marchionne and Palmer are not eligible to participate in our defined benefit pension plans. Mr. Palmer is eligible to participate in the Employee Managed Retirement Plan and the Supplemental Managed Retirement Plan. The amount contributed in 2013 by us to the Employee Managed Retirement Plan and the Supplemental Managed Retirement Plan on behalf of Mr. Palmer is reported in the “All Other Compensation” column of the 2013 Summary Compensation Table.

Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans

Commencing in 2009 through 2011, our named executive officers (other than Mr. Marchionne) received a portion of their total annual compensation in the form of DPSs granted under the DPS Plan tied to the value of our Class A Membership Interests, in the discretion of the Chief Executive Officer of Chrysler Group, subject to approval by the Compensation Committee and the Special Master. Each DPS represents the value of a Chrysler Group Unit, as described under the caption —Compensation Discussion and Analysis —Compensation Components —Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs above. On each monthly payroll date, a specified amount equal to a portion of a named executive officer’s gross cash base salary for the payroll period was converted into a number of DPSs, which represent the right to receive a future cash payment based on

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the value of the Chrysler Group Unit, by dividing the specified amount by the then fair value of a Chrysler Group Unit. Payments under the DPS Plan are made in cash based on the fair value of a Chrysler Group Unit as of the most recently completed valuation at the time payment is made. The final grant of DPSs was made in December 2011. Effective January 1, 2014, all of our named executive officers (other than Mr. Marchionne) will be eligible to participate in the Supplemental Managed Retirement Plan. Prior to January 1, 2014, only Mr. Palmer participated in the Supplemental Managed Retirement Plan. The Supplemental Managed Retirement Plan is a restorative supplemental retirement plan that provides a contribution to a retirement benefit account computed using the same formula as the formula under the Employee Managed Retirement Plan except that contributions are not limited by the IRS’s covered compensation limit ($255,000 in 2013) or annual additions limit ($51,000 in 2013). Effective January 1, 2014, each U.S. non-bargaining unit employee is eligible for a benefit under the Supplemental Managed Retirement Plan if his or her covered compensation exceeds the IRS’s covered compensation limit. Prior to January 1, 2014, the Supplemental Managed Retirement Plan was only open to U.S. non-bargaining unit employees hired after December 31, 2003.

The following provides information as of December 31, 2013 with respect to our deferred compensation plans in which our named executive officers participated.

Name	Executive Contributions in Last Fiscal Year ($)		Company Contributions in Last Fiscal Year(1) ($)		Aggregate Earnings in Last Fiscal Year(2) ($)		Aggregate Withdrawals/ Distributions (3) ($)		Aggregate Balance at Last Fiscal Year- End ($)
Sergio Marchionne		—		225,288		36,797		—		262,085
Richard K. Palmer		—		46,050		75,531		720,297		271,550
Reid A. Bigland		—		—		32,935		325,176		104,904
Michael Manley		—		—		49,965		561,487		131,892
Mark M. Chernoby		—		—		37,456		395,179		101,404

(1) With respect to Mr. Marchionne, the amount reported in this column represents restricted stock units granted in July 2012, pursuant to the Director RSU Plan, which have vested but were not paid as of December 31, 2013 since the payment under the Director RSU Plan does not occur until separation from service with the Board. These vested restricted stock units are also reported as stock vested in 2013. See —Compensation of the Named Executive Officers —Options Exercised and Stock Vested in 2013. With respect to Mr. Palmer, the amount reported in this column represents company contributions to the Supplemental Managed Retirement Plan.

(2) The amount reported in this column represents the product of (i) the number of Chrysler Group Units related to DPSs granted in 2010 and 2011; and (ii) the difference between (x) the fair value of a Chrysler Group Unit on December 31, 2012 or the grant date, whichever is later, and (y) the fair value of a Chrysler Group Unit on December 31, 2013. With respect to Mr. Palmer, the amount reported in this column also includes earnings on his Supplemental Managed Retirement Plan account balance. The fair value of a Chrysler Group Unit is based on the fair value of our Class A Membership Interests. Since there is no publicly observable trading price for our membership interests during the periods presented, we periodically value our Class A Membership Interests using a discounted cash flow methodology. Amounts in this column are not included in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” column of the 2013 Summary Compensation Table because no such earnings would be considered above market or preferential.

(3) The amount reported in this column represents the payment of DPSs and restricted stock units granted in 2009. DPSs are fully vested upon grant and, except for the DPSs granted to Mr. Marchionne, are paid in three equal installments at the end of the quarter in which the second, third and fourth anniversaries, respectively, of the monthly grant occur. Payments under the DPS Plan are made in cash and are based on the fair value of Chrysler Group’s Class A Membership Interests as of the most recently completed valuation at the time of payment, and are made regardless of employment status at the time of payment. The restricted stock units granted in 2009 vested in 2012 but were not paid until 2013 since the payment under the plan terms is deferred until the calendar year after the year in which vesting occurs. Payment of such restricted stock units was made in cash and was based on the fair value of Chrysler Group’s Class A Membership Interests as of the most recently completed valuation at the time of payment.

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Potential Payments upon Termination or Change of Control

The following summaries describe and quantify the potential payments and benefits that we would provide to our named executive officers in connection with termination of employment. In determining amounts payable, we have assumed in all cases that the termination of employment occurred on December 31, 2013. Most of our plans and programs, including the DPS Plan, the RSU Plan, the 2012 LTIP and the Supplemental Executive Retirement Plan, contain specific provisions detailing how payments are treated upon termination. We are not obligated to provide our named executive officers with any payments or benefits in connection with a change of control, except as described below with respect to the 2012 LTIP.

Severance Policy

Our named executive officers may be eligible for severance benefits under the Termination Allowance Plan. The Termination Allowance Plan applies to all full-time U.S. based executive employees who have a minimum of three years of continuous service as of the termination date. The plan may pay severance benefits in the event that an employee is indefinitely laid off, forced to retire without retirement benefits or permanently and totally disabled and not eligible for long-term disability benefits. The amount of severance varies based on the employee’s continuous years of service with us and is conditioned on the employee’s execution of a general release of claims. The actual severance benefit for our named executive officers under the Termination Allowance Plan is based on their monthly base salary and determined in accordance with the following schedule:

Continuous Service Before Effective Date of Separation	Number of Months of Continued Base Salary
Less than 3 years of service	0 months
3 but less than 4 years of service	1 month
4 but less than 5 years of service	2 months
5 but less than 10 years of service	3 months
10 but less than 15 years of service	6 months
15 but less than 20 years of service	9 months
20 or more years of service	12 months

The maximum amount of severance for the named executive officers under the Termination Allowance Plan is 12 months of base salary. The severance benefit is paid in cash in monthly installments equal to the base monthly salary.

Vesting of Restricted Stock Units

Our named executive officers (other than Mr. Marchionne) received long-term incentives in the form of restricted stock units.

For restricted stock units granted in January 2011 and January 2012, referred to as the 2011 restricted stock units and 2012 restricted stock units, respectively, a restricted stock unit holder will vest in the Chrysler Group Units related to the award if the holder is continuously employed by us through the third anniversary of the grant date. If the holder retires on or after the second anniversary of grant, then such holder will continue to be considered employed for vesting purposes for all restricted stock units. For purposes of all restricted stock units, the holder will be treated as having retired upon a termination of employment after reaching age 55 and completing 10 years of service with Chrysler Group or a predecessor company (or after satisfying other applicable retirement criteria). All unvested restricted stock units will become fully vested upon the holder’s death or permanent disability. Unvested restricted stock units as of the date of termination are forfeited. Payment of the 2011 and the 2012 restricted stock units is to be no later than March 15 of the calendar year following the year in which they vest.

Once vested, the restricted stock units will be settled in cash or, in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. Payment for vested restricted stock units will be made regardless of employment status at the time of the scheduled payment.

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Mr. Marchionne was granted restricted stock units pursuant to the Director RSU Plan (defined below), for his Board service from June 10, 2013 through June 10, 2014. These restricted stock units will vest on June 10, 2014. For additional information about the restricted stock units granted to the members of the Board, see —Director Compensationbelow.

Vesting of Long-Term Incentives in the form of LTIP RSUs and LTIP PSUs

The LTIP RSUs will vest over three years in one-third increments on the anniversary of their grant date, while the LTIP PSUs will vest at the end of the three-year performance period only if we meet or exceed certain three-year cumulative company performance targets. Concurrent with the adoption of the 2012 LTIP, the Compensation Committee established company performance targets composed of specified levels of cumulative Chrysler Group Modified Operating Profit and cumulative Free Cash Flow for the three-year performance period, ending December 31, 2014. If we do not fully achieve these targets, the LTIP PSUs will be deemed forfeited.

Once vested, LTIP RSUs and LTIP PSUs will be settled in cash or, in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. Vesting of the LTIP RSUs and LTIP PSUs may be accelerated in certain circumstances, including upon the participant’s death, disability or in the event of a change of control, or other circumstances the Compensation Committee determines to be appropriate. Settlement will be made as soon as practicable after vesting, but in any case no later than March 15th of the year following vesting, provided that the participant has not been terminated for cause prior to the established payment date.

LTIP RSUs will vest upon a participant’s death or disability, whereas LTIP PSUs will not. Unvested LTIP PSUs are not forfeited upon a participant’s death or disability, but rather remain outstanding and vest at the end of the three-year performance period dependent on the Company’s attainment of its performance targets. With respect to both LTIP RSUs and LTIP PSUs, if a participant’s employment with us is terminated by (i) termination by us other than for cause, (ii) the participant’s death, or (iii) the participant’s disability, in each case within twenty four months of a change of control, all terms and conditions shall be deemed met and such LTIP RSUs and LTIP PSUs shall be paid within thirty days of the participant’s termination of employment. In such case, LTIP PSUs would be paid out at target levels.

For purposes of terminations under the 2012 LTIP, “cause” means the participant’s:

• Willful failure to perform substantially his or her responsibilities;

• Engagement in illegal conduct or in gross misconduct, in either case, that causes financial or reputational harm to the Company or any of its subsidiaries or affiliates;

• Commission or conviction of, or plea of guilty or nolo contendere to, a felony; or

• Material breach of the terms of the 2012 LTIP or any other agreement entered into between the participant and the Company or any of its subsidiaries or affiliates.

Under the 2012 LTIP, a “change of control” is generally defined to include any transaction or series of transactions, including an acquisition of stock, the consummation of a reorganization, merger or consolidation of the Company, or the sale, lease or exchange or other transfer of at least 50 percent in value of the Company’s assets, in which a person or group of persons who was not an owner of more than 50 percent of the then outstanding voting capital units of the Company, becomes such or the members of an existing group holding more than 50 percent of the then outstanding voting capital units of the Company do not continue to hold such interests in substantially the same proportions relative to each other as before such transaction or series of transactions. However, specifically excluded from the definition are transactions involving direct acquisitions of

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voting capital units from the Company, Fiat or any employee benefit plan or trust of either of them. Additionally, an initial public offering would not in itself be considered a change of control.

Estimated Potential Termination Payments and Benefits

The following table provides the estimated value of the payments and benefits that we would provide to our named executive officers in connection with termination of employment. In determining amounts payable, we have assumed in all cases that the termination of employment occurred on December 31, 2013 and that fair value of the Chrysler Group Units was $10.47. The actual value that would be recognized by a named executive officer with respect to his or her restricted stock units, LTIP PSUs, and LTIP RSUs can only be determined at the time of payment and could be affected by changes to the fair value of our Class A Membership Interests following termination of employment. Due to the number of factors that affect the nature and amounts of any benefits provided upon the events described below, any actual amounts paid or distributed may be higher or lower than reported below. In addition, in connection with any actual termination of employment, we may determine to enter into one or more agreements or to establish arrangements providing additional benefits or amounts, or altering the terms of benefits described above.

Name	Severance and Other Benefits (1) ($)		Unvested Restricted Stock Units(2) ($)		Unvested LTIP PSUs and LTIP RSUs(3) ($)		Total ($)
Sergio Marchionne		—		—		—		—
Termination		—		—		—		—
Retirement		—		—		—		—
Death		—		211,089		—		211,089
Disability		—		211,089		—		211,089
Change of Control		—		—		—		—
Richard K. Palmer
Termination		116,668		—		—		116,668
Retirement		—		—		—		—
Death		—		1,159,099		465,266		1,624,365
Disability		—		1,159,099		465,266		1,624,365
Change of Control		—		—		3,097,518		3,097,518
Reid A. Bigland
Termination		102,501		—		—		102,501
Retirement		—		—		—		—
Death		—		613,016		399,410		1,012,426
Disability		—		613,016		399,410		1,012,426
Change of Control		—		—		2,298,217		2,298,217
Michael Manley
Termination		205,002		—		—		205,002
Retirement		—		—		—		—
Death		—		939,267		367,455		1,306,722
Disability		—		939,267		367,455		1,306,722
Change of Control		—		—		2,266,263		2,266,263
Mark M. Chernoby
Termination		400,008		—		—		400,008
Retirement		—		—		—		—
Death		—		651,332		333,323		984,655
Disability		—		651,332		333,323		984,655
Change of Control		—		—		1,954,257		1,954,257

(1) The named executive officers are eligible to receive severance payments under the Termination Allowance Plan based upon the length of service at the time of termination. This column represents the maximum potential payout for each of the named executive officers upon termination.

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(2) The amounts reported in this column represent the total fair value on December 31, 2013 of the Chrysler Group Units related to the restricted stock units granted under the RSU Plan that would vest upon a named executive officer’s retirement, death or disability based on a fair value of the Chrysler Group Units of $10.47. With respect to Mr. Marchionne, the amounts reported in this column represent the total fair value on December 31, 2013 of the Chrysler Group Units related to the restricted stock units granted under the Director RSU Plan for his Board service from June 2013 through June 2014 that would vest upon his death or disability based on a fair value of the Chrysler Group Units of $10.47. Because DPSs are fully vested upon grant and paid at the time of the scheduled payment, no additional value would be recognized by the named executive officer solely as a result of their termination of employment.

(3) The amounts reported in this column represent the total fair value on December 31, 2013 of the Chrysler Group Units related to (i) LTIP RSUs that would vest upon a named executive officer’s death or disability and (ii) LTIP PSUs and LTIP RSUs that would vest if a named executive officer is terminated within twenty four months of a change of control due to (a) a termination by us for other than for cause, (b) the participant’s death, or (c) the participant’s disability, based on a fair value of the Chrysler Group Units of $10.47.

Risk Considerations in our Compensation Program

Our Compensation Committee is responsible for ensuring that our compensation programs are consistent with our safety and soundness, including reviewing the relationship between our risk management policies and practices and the executive compensation arrangements. Our senior risk officer, Mr. Palmer, reviewed with the Compensation Committee all compensation programs, including the compensation arrangements for our named executive officers, to ensure that the programs and arrangements did not create incentives that encourage employees to take unnecessary or excessive risks that could threaten our value. We believe that the mix and design of the elements of our employee compensation policies and practices do not motivate imprudent risk taking. Consequently, we are satisfied that any potential risks arising from our employee compensation policies and practices are not reasonably likely to have a material adverse effect on us.

Compensation Committee Interlocks and Insider Participation

During the fiscal year ended December 31, 2013, Stephen M. Wolf served as the Chairman, and Léo W. Houle and Dr. Ruth J. Simmons served as members, of our Compensation Committee. No member of the Compensation Committee is or has been an officer or employee of Chrysler Group at any time or had any relationship with Chrysler Group requiring disclosure as a related-party transaction. During the fiscal year ended December 31, 2013, none of our executive officers served as a member of the Board of Directors or Compensation Committee (or other board committee serving an equivalent function) of any unrelated entity that had one or more of its executive officers serving on the Board or Compensation Committee (or other board committee serving an equivalent function).

Director Compensation

Since our formation, our directors have received all of their Board fees in the form of equity-based awards. We believe that a substantial portion of our directors�� compensation should be in the form of equity-based awards so as to align the interests of our directors with our objectives to achieve long-term growth and appreciation in value for the benefit of our stakeholders.

In May 2013, the Board approved a directors’ compensation package for Board service from June 2013 through June 2014 valued at $200,000 per director, in the form of 50 percent equity and 50 percent cash with the directors given the alternative to select compensation in the form of 100 percent equity. All of the directors (other than Mr. Perkins who was precluded from receiving compensation for his Board service as described below) elected to receive their compensation in the form of 100 percent equity. Mr. Marchionne does not receive an annual retainer for his role as chairman. The equity portion was comprised of restricted stock units granted pursuant to the Director RSU Plan. This grant of restricted stock units was made in the third quarter of 2013 and will vest on June 10, 2014.

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Under the Director RSU Plan, vesting of the award is accelerated upon death or permanent disability, and all unvested awards are forfeited upon cessation of service from the Board. An amount equal to the fair value of the Chrysler Group Units underlying any vested restricted stock units held by a director will be paid within 60 days following the date on which the director ceases to serve as a director. Once vested, the restricted stock units will be settled in cash or, in the event we complete a Chrysler Group IPO, the Compensation Committee has the discretion to settle the awards in cash or shares of the publicly traded stock. The number of Chrysler Group Units related to outstanding restricted stock units is subject to adjustment by the Compensation Committee in accordance with the terms of the Director RSU Plan.

Mr. Altavilla’s term on the Board ended on June 10, 2013. Accordingly, Mr. Altavilla received payment of his vested restricted stock units in accordance with the terms of the Director RSU Plan. Robert G. Liberatore was appointed to serve on the Board effective June 10, 2013 and received a grant of restricted stock units for his Board service from June 2013 through June 2014 in the third quarter of 2013 along with the other directors.

Mr. Perkins was appointed to serve on the Board by the VEBA Trust. Mr. Perkins’ employer, the UAW, has a policy in place which precludes any of their employees from receiving compensation for board service. In July 2012, in recognition of the UAW’s policy, the members of Chrysler Group LLC amended our governance documents to provide that the Director appointed by the VEBA Trust would not be eligible to receive compensation from us for his Board service if his employer has a policy in place that prohibits such compensation. Solely on account of these facts, we agreed to remit $200,000 to the VEBA Trust, payable in quarterly cash installments, as long as Mr. Perkins continues to serve on the Board during the June 2013 through June 2014 term. On January 21, 2014, in connection with the sale of the remaining equity interests of the Company held by the VEBA Trust to Fiat, Mr. Perkins resigned from the Board.

Director Summary Compensation Table

The following summarizes the total compensation paid by us to our non-employee directors for services rendered during the year ended December 31, 2013.

Name	Fees Earned or Paid in Cash(1) ($)		Stock Awards (2) ($)		All Other Compensation (3) ($)		Total ($)
Alfredo Altavilla (4)		—		—		—		—
Léo W. Houle		—		200,000		1,450		201,450
John B. Lanaway		—		200,000		1,450		201,450
Robert G. Liberatore (5)		—		200,000		360		200,360
Erickson N. Perkins(6)		—		—		—		—
Ruth J. Simmons		—		200,000		1,450		201,450
Douglas M. Steenland		20,000		200,000		1,450		221,450
Ronald L. Thompson		25,000		200,000		1,450		226,450
Stephen M. Wolf		15,000		200,000		1,450		216,450

(1) Our non-employee directors did not earn or receive an annual retainer fee in 2013 for their service as directors, other than our Lead Director, Mr. Thompson. Each non-employee committee chair was entitled to an annual retainer, the amount of which differed depending upon the committee, as follows: Audit Committee, $20,000 (Mr. Steenland) and Compensation Committee, $15,000 (Mr. Wolf).

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(2) The table below shows the aggregate number of restricted stock units outstanding for each non-employee director as of December 31, 2013:

Name	Aggregate Number of Restricted Stock Units at Last Fiscal Year-End(a) (#)
Alfredo Altavilla (4)		—
Léo W. Houle		70,263.29
John B. Lanaway		70,263.29
Robert G. Liberatore (5)		20,161.29
Erickson N. Perkins(6)		—
Ruth J. Simmons		45,193.29
Douglas M. Steenland		544,671.79
Ronald L. Thompson		544,671.79
Stephen M. Wolf		544,671.79

(a) In late 2009, Messrs. Altavilla, Steenland, Thompson and Wolf received a grant of restricted stock units under the 2009 Directors’ Plan with an initial value of $600,000 for their service as directors of the Company from June 2009 through June 2012. On September 22, 2011, in accordance with the terms of the plan, the number of restricted stock units they had received was adjusted to preserve the economic value of the awards and offset the dilutive effect of changes in Fiat’s ownership interest. In September 2011, Messrs. Houle and Lanaway received a grant of restricted stock units under the Director RSU Plan with an initial value of $154,432 for their service as directors of the Company from September 2011 through June 2012. In July 2012, all of the members of the Board (other than Mr. Perkins) received a grant of restricted stock units under the Director RSU Plan with an initial value of $200,006 for their service as directors from June 2012 through June 2013. In July 2013, all of the members of the Board (other than Mr. Perkins) received a grant of restricted stock units under the Director RSU Plan with an initial value of $200,000 for their service as directors from June 2013 through June 2014.

(3) The amounts reported in this column represent the incremental cost to us for the Company furnished vehicle provided to our non-employee directors while serving as an active member of the Board. We calculate the incremental cost of providing the Company vehicles by comparing the cost of production against the value received upon the disposal of the vehicle plus the cost of maintenance and repair, insurance, licensing and registration fees. Directors are taxed on the imputed income attributed to personal use of Company vehicles and do not receive tax assistance from us. The amounts reported in this column do not include amounts paid to Mr. Altavilla for his vested restricted stock units upon the expiration of his term on the Board in accordance with the terms of the Directors’ Plan.

(4) Term on the Board expired in June 2013.

(5) Joined the Board in June 2013.

(6) Mr. Perkins receives no compensation from us as described above.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following sets forth information as of the date of this prospectus, regarding the beneficial ownership of our Class A Membership Interests for: (i) each person known by us to beneficially own either class of our membership interests; (ii) each director; (iii) each of our named executive officers; and (iv) all of our directors and executive officers as a group.

Beneficial ownership is determined in accordance with the rules of the SEC and includes having voting and/or investment power with respect to the securities. Each of the persons and entities named in the table below have sole voting and sole investment power with respect to the membership interests set forth opposite each person’s or entity’s name.

As of the date of this prospectus, there were 1,632,654 Class A Membership Interests authorized, issued and outstanding. Unless otherwise indicated, the address for each of the individuals listed in the table is c/o Chrysler Group LLC, 1000 Chrysler Drive, Auburn Hills, Michigan, 48326.

Name and Address of Beneficial Owner	Class A Membership Interests
	Number of Membership Interests		Percent of Class			Percent of Voting Power
Fiat North America LLC (1)		1,632,654		100	%		100	%
c/o Fiat Finance NA Inc. 7 Times Square Tower STE. 4306 New York, NY 10036
Directors and Named Executive Officers:
Léo W. Houle		—		—			—
John B. Lanaway		—		—			—
Robert G. Liberatore		—		—			—
Ruth J. Simmons		—		—			—
Douglas M. Steenland		—		—			—
Ronald L. Thompson		—		—			—
Stephen M. Wolf		—		—			—
Sergio Marchionne		—		—			—
Richard K. Palmer		—		—			—
Reid Bigland		—		—			—
Mark Chernoby		—		—			—
Michael Manley		—		—			—
Directors and Executive Officers as a group, including those named above (20 persons)		—		—			—

(1) Includes 54,153.92 Class A Membership Interests held by FNA Holdco 00, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 01, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 02, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 03, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 04, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 05, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 06, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 07, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 08, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 09, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 10, LLC, 54,153.92 Class A Membership Interests held by FNA Holdco 11, LLC, and 27,076.96 Class A Membership Interests held by FNA Holdco 12, LLC.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Transactions with Fiat

On April 30, 2009, we entered into the Master Transaction Agreement under which we agreed to purchase the principal operating assets and assumed certain liabilities of Old Carco and its principal domestic subsidiaries in addition to acquiring the equity of Old Carco’s principal foreign subsidiaries. On June 10, 2009, we completed the 363 Transaction contemplated by the Master Transaction Agreement following bankruptcy court approval in connection with Old Carco’s bankruptcy proceeding. As a result of a series of transactions between 2011 and early 2014 that were contemplated in our governance documents and by certain other agreements, Fiat now beneficially owns 100 percent of our membership interests.

The Fiat-Chrysler Alliance is composed of various commercial arrangements relating primarily to the development, manufacture and distribution of vehicles, and the development and manufacture of powertrains. The terms and conditions governing the Fiat-Chrysler Alliance are set forth in the Master Industrial Agreement and ancillary agreements entered into pursuant to the Master Industrial Agreement, which provides for:

• Technology and Product Sharing —We have access to certain of Fiat’s platforms, vehicles, products and technology. These include: (i) Fiat’s mini, small, and compact vehicle platforms; and (ii) specified vehicle models, engines, engine technologies, transmissions, and related technology for production within North America and for distribution within North America and other agreed markets. Pursuant to this arrangement, we are currently manufacturing the Fiat 500 vehicle in our Toluca plant (Mexico). The Fiat 500 includes the Fiat 1.4L FIRE engine, manufactured in our Dundee plant (Michigan), as well as transmissions purchased from Fiat. In July 2013, we launched production of the all-new Ram ProMaster in our Saltillo plant (Mexico). The all-new Ram ProMaster is based on the Fiat Professional Ducato light commercial vehicle currently produced in Europe and South America.

In addition, we are cooperating on: (i) engineering and development activities, such as those related to the CUSW platform utilized for the Dodge Dart, as described underBusiness —Fiat-Chrysler Alliance and Management’s Discussion and Analysis of Financial Condition and Results of Operations —Progress on our Strategic Business Plan; (ii) manufacturing activities, such as implementation of WCM processes utilized by Fiat in our manufacturing plants; and (iii) the manufacture, assembly, or sale of built-up vehicles, engines, transmissions, components and other products. For example, in May 2013, Fiat began contract manufacturing and selling the all-new Fiat 500L to us for our sale of the vehicle in North America. We have both also committed to identifying further possible product portfolio sharing. For example, we licensed certain vehicle technology to Fiat for a Fiat-branded vehicle that Fiat’s Chinese joint venture began to produce in September 2012 and for another vehicle that is expected to begin production in 2014.

• Distribution —We have established: (i) Fiat’s role in the distribution of our vehicles and service parts in Europe and other specified markets outside of North America, including the appointment of Fiat as the general distributor and importer in those markets, directly or indirectly, and in the provision of wholesale and retail financing for our vehicles in certain markets outside of North America; (ii) our role as the exclusive distributor and importer of Fiat and Alfa Romeo brand vehicles and service parts within North America and other specified markets outside of Europe; and (iii) distribution strategies.

We began implementing our distribution strategy for markets outside of North America in 2010. Fiat initially assumed the management of our distribution and sales operations in select European countries in 2010. In June 2011, Fiat became the general distributor of our vehicles and service parts for Europe selling our products through a network of newly appointed dealers. In connection

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with this transition, we also sold several dealerships that we owned and certain assets of 15 of our international distribution centers in Europe to Fiat. We are now distributing Fiat vehicles in certain markets through our international distribution centers around the world. In addition, Fiat has taken on the distribution of our vehicles in certain markets outside North America where its dealer networks are better established. In addition, financial services affiliates of Fiat are providing financing to our dealers and consumers in China, Argentina and Brazil.

We began selling the Fiat 500 in the U.S. and Canada in March 2011 through a network of newly appointed dealers, and we are also selling some of the Fiat 500 vehicles we produce in Mexico to Fiat for distribution outside of North America as well as directly selling the Fiat 500 vehicles in South Korea. In addition, we began distributing Fiat and Fiat Professional (light-duty commercial) brand vehicles and service parts in Mexico in October 2010, and in Russia, Australia and other markets in 2012. In addition, Fiat manufactures certain Fiat-brand vehicles for us, which we sell throughout North America. We also began distributing Alfa Romeo brand vehicles and service parts in Mexico in 2011 and in Australia and other markets in 2012, and expect to sell Alfa Romeo brand vehicles and service parts in the U.S. and Canada.

• Procurement —We continue to integrate our procurement activities with Fiat’s procurement operations, including: (i) the establishment of joint purchasing programs designed to yield preferred pricing and logistics terms, particularly with respect to shared parts and components and common suppliers; and (ii) the restructuring of our procurement activities and integration with Fiat’s procurement operations.

• Information and Communication Technology —We and Fiat are coordinating our respective information and communication technologies. Ongoing efforts include: (i) identification of ways to reduce the costs of such technologies and generate other benefits; (ii) prioritization of systems, applications and infrastructure initiatives based on the 2010-2014 Business Plan targets; (iii) implementation of common technology solutions in various functional areas, including upgraded engineering product lifecycle management and computer-aided design tools, and adoption of the SAP system currently used by Fiat to replace our finance, procurement, and capital project and investment management systems, the first phase of which was implemented in January 2013 and the second phase of which was implemented in January 2014; and (iv) deployment of emerging communication, collaboration and server network technologies. We have largely completed the planned transition of our business process systems outside North America to Fiat’s systems.

In 2012, certain additional Fiat affiliates became parties to several of the ancillary agreements governing the Fiat-Chrysler Alliance, including agreements relating to engineering and development cooperation, services, powertrain cross supply, contract manufacturing and vehicle component cross supply.

Fiat may terminate the Master Industrial Agreement and all of the ancillary agreements on 120 days’ prior written notice at any time. Upon such termination: (i) each party must continue to distribute, if requested, the other party’s vehicles and service parts for two years on the same terms and conditions as in effect immediately prior to termination, and to cooperate for up to an additional six months to facilitate transition of distribution services; (ii) Fiat must continue to make available to us for thirty-six months the technology rights and other items available under the agreements on the same terms in effect on the date of termination, and thereafter until the end of production on the same terms but at commercially reasonable royalty rates; and (iii) we must continue to make available to Fiat for thirty-six months, or if longer, until the end of production, the technology and other items available under the agreements on the same terms as in effect on the date of termination but at commercially reasonable royalty rates.

In addition, either we or Fiat may terminate the Master Industrial Agreement and all of the ancillary agreements if the other party either commits a breach that is material, considering all ancillary agreements taken as a whole, or in the event of certain bankruptcy, liquidation or reorganization proceedings. Upon a termination for breach or

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bankruptcy events, the terminating party will be entitled to receive continued distribution services and technology rights and other items from the other party as noted above.

Other Transactions with Fiat

We have also entered into the following transactions with Fiat or its affiliates:

• In March 2010, we entered into a multi-year agreement with an affiliate of Fiat to provide it with service parts distribution services in North America, on a per-service fee basis. We received $1.6 million for such services during the year ended December 31, 2013.

• In October 2010, we entered into a non-binding memorandum of understanding with an affiliate of Fiat to license certain technology, and to provide certain products and engineering services. In January 2011, we entered into a subsequent definitive technology license agreement with that Fiat affiliate, which includes a one-time license fee of $37 million. We are supplying select components to this Fiat affiliate (both directly and indirectly through another affiliate) and certain engineering services under a master engineering agreement. For the year ended December 31, 2013, we have received $38.4 million for these services. We will continue to receive payments on a per-service fee basis.

• In August 2010, we entered into a multi-year agreement with a Fiat affiliate for the provision of various administrative services to support our operations in Australia. We paid approximately $47,000 for these services in 2013.

• In January 2011, we entered into a multi-year agreement with Fiat to provide our service diagnostic tools to Fiat for use in its dealerships and authorized repair facilities. As part of this agreement, we will supply tools to Fiat and perform software development services, and we will also provide ongoing maintenance services. We invoice Fiat on a periodic basis for tools and services rendered. For the year ended December 31, 2013 we have received $3.5 million for these services.

• In March 2011, we entered into an agreement with a Fiat affiliate to purchase tax credits in Venezuela for $8.1 million.

• In May 2011, we entered into a five-year agreement with a Fiat affiliate to provide us with service parts for certain competitive brand vehicles that we will sell through retail and wholesale channels in the U.S. A second agreement covering the same parts for international (non-U.S.) markets was executed in May 2013. Our total purchases under these agreements were $9.8 million for the year ended December 31, 2013.

• In December 2011, we entered into a multi-year agreement with a joint venture affiliate of Fiat in China, pursuant to which we will sell vehicles and service parts that we manufacture for distribution through Fiat’s dealer network in China. In addition, we are selling select vehicle components to this Fiat affiliate. For the year ended December 31, 2013, we have received approximately $56 million for these vehicles, service parts, and components. In January 2013, we also entered into a non-binding memorandum of understanding with this joint venture for the potential license of certain vehicle and engine technology for the local production of Jeep vehicles that will be sold only in China.

• In June 2012, we entered into an agreement to sell our Fiat dealer receivables in Russia to a financial services affiliate of Fiat. Our total receivable sales under this agreement were $112.9 million for the year ended December 31, 2013.

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• During 2012, we entered into a multi-year agreement with an affiliate of Fiat to obtain transportation services, as well as cost allocation agreements with Fiat to share costs associated with certain security and related expenses incurred regarding Mr. Marchionne while in Michigan working on our behalf, or traveling globally on behalf of us and Fiat. For the year ended December 31, 2013 we paid approximately $2.1 million for such services and received approximately $393,000 from Fiat for such services.

• In 2012, we consolidated our purchase of certain property and liability insurance coverage for the 2013 calendar year together with Fiat and its affiliates to achieve reduced premiums and enhanced coverage. Certain Fiat-affiliated insurance companies participated in this transaction as brokers and as reinsurers, and received $1.7 million in the year ended December 31, 2013 funded out of the premiums we have paid to the applicable underwriters.

• We entered into an agreement, effective June 2012, in which a Fiat affiliate will sponsor certain sporting events in which we participate, for which we are entitled to receive $300,000.

• We entered into a multi-year agreement with a Fiat affiliate, effective January 2013, to receive transactional processing services. For the year ended December 31, 2013, we paid approximately $2.1 million for these services.

• In March 2013, we entered into an agreement with a Fiat affiliate to purchase tax credits in Venezuela for $1.4 million.

• We entered into a cooperation agreement, effective July 2013, with a Fiat affiliate to assist them in meeting requirements under certain federal and state vehicle emissions regulations.

• In 2013, we entered into an employee secondment agreement with an affiliate of Fiat, for which we expect to receive approximately $270,000.

• In January 2014, we entered into an agreement together with Fiat and one of its affiliates, for the procurement of certain services from a third party. As part of this transaction, we expect to be reimbursed by Fiat and its affiliate for our transition costs related to these services in the amount of approximately $6.0 million.

From time to time, we also purchase or sell goods and services from or to Fiat affiliates in the ordinary course through competitive bids or directed sourcing, when applicable.

In total, our transactions with Fiat for the years ended December 31, 2013, 2012 and 2011, included $2,173 million, $2,689 million and $2,162 million, respectively, of goods and services Fiat purchased from us, and $2,444 million, $1,504 million and $800 million, respectively, of goods and services we purchased from Fiat. In addition, during the years ended December 31, 2013, 2012 and 2011, we recognized reimbursements due from Fiat of $33 million, $51 million and $78 million, respectively, and recognized reimbursements due to Fiat of $93 million, $45 million and $25 million, respectively, for costs related to shared engineering and development activities performed under the product and platform sharing agreement that is part of the Fiat-Chrysler Alliance.

Mr. Marchionne is the Chief Executive Officer of Fiat and Chairman or Chief Executive Officer for several significant business units within Fiat and affiliates of Fiat. His compensation from Fiat is publicly disclosed in Fiat’s annual report.

Mr. Palmer served as Chief Financial Officer of Fiat Group Automobiles until becoming our Chief Financial Officer in 2009. In September 2011, Mr. Palmer was given the additional role of Chief Financial Officer of Fiat.

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Mr. Alessandro Gili, formerly Head of Accounting for Fiat Group Automobiles, became our Corporate Controller and Chief Accounting Officer in June 2011. In October 2011, Mr. Gili took on additional responsibilities to lead the development of common processes and procedures for the finance organizations of Fiat and Chrysler Group. In June 2013, Mr. Gili was appointed the Chief Accounting Officer of Fiat.

Fiat has responsibility for any repatriation costs if certain former Fiat employees, including Mr. Gili, were to return to Italy. Fiat also has continued to make employer contributions on behalf of Mr. Palmer, Mr. Gili and certain of our other executive officers that are former Fiat employees to the Italian social security system and with respect to certain Italian pension and health arrangements. Fiat employer contributions on behalf of Mr. Palmer with respect to certain Italian pension and health arrangements discontinued effective December 1, 2013.

In September 2011, Fiat formed the GEC, to oversee and enhance the operational integration of all Fiat interests, including Chrysler Group. Members of the GEC include the following Chrysler Group executives: Messrs. Marchionne, Betts, Bigland, Chernoby, Francois, Gorlier, Keegan, Lee, Manley, and Palmer. Nevertheless, Chrysler Group and Fiat remain distinct legal entities with separate governance. The GEC cannot contractually bind Chrysler Group, and recommendations made by the GEC to Chrysler Group, including transactions with Fiat companies, are subject to Chrysler Group LLC’s governance procedures. Refer toManagement —Corporate Governance for additional information.

Transactions with the VEBA Trust

In 2013, we paid $150,000 in director compensation to the VEBA Trust in lieu of director compensation to Erickson Perkins pursuant to the provisions of our governance documents. Mr. Perkins served as a director of the Company, as appointed by the VEBA Trust, until his resignation on January 21, 2014 and was precluded from receiving such compensation by the UAW, his employer, as described under —Policies and Processes for Transactions Involving Related Parties below.

Policies and Processes for Transactions Involving Related Parties

As to agreements we have with or for the benefit of our affiliates, our governance documents provide that transactions with or for the benefit of any affiliate involving aggregate payments in excess of $25 million must be approved by a majority of the disinterested directors of the Board. If there are no disinterested directors, the Board must obtain the favorable opinion of an independent expert as to the fairness of the transaction to the Company from a financial point of view. We have a separate written policy that further delineates this process for transactions with Fiat and its affiliates. Once negotiated, transactions over a certain threshold amount are elevated by our Business Development team to the Governance Committee for approval. Otherwise, any ordinary course purchase order transaction with a Fiat affiliate involving a value in excess of a certain threshold amount is brought to the Governance Committee by our Global Purchasing team. In each case, if the Governance Committee is not composed of all of the Company’s disinterested directors with respect to the transaction, the Governance Committee will review the transaction and determine whether it should be presented to all of the Company’s disinterested directors for approval. Also, certain categories of transactions contemplated by the Master Industrial Agreement may be pre-approved by the disinterested directors. Our management team reports regularly to the Governance Committee regarding the status of our principal agreements and financial exchanges with Fiat.

We also have a written policy that governs related party transactions not involving Fiat and its affiliates, in which the Board has delegated to the Governance Committee the authority to review and approve any transaction involving us and any of our executive officers, directors, director nominees, or any beneficial owner of five percent or more of our equity. Transactions between the Company and immediate family members of any of the above parties are also subject to this process. In its review, the Governance Committee must consider each such transaction and determine whether it is in the best interests of the Company, whether comparable

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commercial terms could be obtained in an arms’ length transaction with an unrelated party, whether such an agreement would trigger a default under the Company’s financing agreements and whether required internal approvals were obtained. To date, there have been no such transactions other than aggregate payments of $200,000 to the VEBA Trust for Mr. Perkins’ service on the Board. This arrangement was approved by our full Board, prior to the creation of the Governance Committee, with Mr. Perkins abstaining. We entered into this arrangement in light of the fact that Mr. Perkins, who was appointed to serve on the Board by the VEBA Trust, had requested that he receive no compensation for his Board service in accordance with the policy of his employer, the UAW, and was therefore precluded from such compensation pursuant to the provisions of our governance documents. Refer toExecutive Compensation —Director Compensation for additional information.

Our compliance with both these related party policies is audited, and the results of those audits are periodically communicated to our Audit Committee.

In addition to our related party transactions policies, we have a written conflict of interest policy and related procedure applicable to our officers and employees and their spouses and minor children that prohibit them from having personal interests in transactions which conflict with our interests, or which might influence the judgment or actions of our officers and employees in performing their duties. A management committee, the Business Practices Committee, interprets the policy, issues advisories, and reports periodically to the Audit Committee of the Board with respect to noncompliance or waivers.

Director Independence

Our governance documents require that to be independent, a director must be independent of the Company and, if applicable, the party appointing such director. A director’s independence is determined by reference to the list of enumerated relationships precluding independence under the listing rules of the New York Stock Exchange.

Mr. Marchionne is employed by Fiat and does not qualify as an independent director under the New York Stock Exchange standards. The Board has determined that all of its other members qualify as independent directors under those standards.

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DESCRIPTION OF OTHER INDEBTEDNESS

The following summary of certain provisions of the instruments evidencing our material indebtedness does not purport to be complete and may not contain all of the information that is important to you, and is subject to, and qualified in its entirety by reference to, all of the provisions of the corresponding agreements.

Senior Credit Facilities

Existing Senior Credit Facilities

On May 24, 2011, we, and certain of our U.S. subsidiaries as guarantors, entered into the Original Senior Credit Agreement, with certain lenders and Citibank, N.A., as administrative agent and collateral agent, under which we obtained Senior Credit Facilities consisting of a $3.0 billion Tranche B Term Loan and a $1.3 billion revolving credit facility, or the Revolving Facility. Our existing and subsequently acquired or organized domestic, principal operating subsidiaries are, or are required to become, guarantors under the Senior Credit Facilities, subject to certain limited exceptions. We amended and restated the Original Senior Credit Agreement on June 21, 2013, such amendment and restatement represented by our Senior Credit Agreement, and subsequently amended the Senior Credit Agreement on December 23, 2013. The Tranche B Term Loan matures on May 24, 2017, and the Revolving Facility matures on May 24, 2016. After giving effect to interest rate reductions made by the amendment and restatement and subsequent amendment, the Tranche B Term Loan bears interest, at our option, at either a base rate plus 1.75 percent per annum or at the reserve-adjusted Eurodollar rate plus 2.75 percent per annum, subject to a base rate floor of 1.75 percent per annum or a reserve-adjusted Eurodollar rate floor of 0.75 percent per annum, and borrowings outstanding under the Revolving Facility bear interest, at our option, at either a base rate plus 2.25 percent per annum or a reserve-adjusted Eurodollar rate plus 3.25 percent per annum. The amendment and restatement also reduced the commitment fee payable on the Revolving Facility to 0.50 percent per annum, which may be reduced to 0.375 percent per annum if we achieve a specified consolidated leverage ratio, of the daily average undrawn portion of the Revolving Facility. The commitment fee is payable quarterly in arrears.

The outstanding principal amount of the Tranche B Term Loan is payable in equal quarterly installments of $7.5 million, with the remaining balance due at maturity. No scheduled principal payments are required on amounts drawn on the Revolving Facility until the maturity date of the facility.

If we voluntarily refinance or re-price all or any portion of the Tranche B Term Loan before the six-month anniversary of the effective date of the second amendment, under certain circumstances, we will be obligated to pay a call premium equal to 1.00 percent of the principal amount prepaid or re-priced.

Certain negative covenants in the Original Senior Credit Agreement were also amended in the amendment and restatement, including limitations on incurrence of indebtedness and certain limitations on restricted payments, which include dividends. Under the Senior Credit Agreement, among other exceptions, the restricted payment capacity was increased to an amount not to exceed 50 percent of our cumulative consolidated net income, as defined in the Senior Credit Agreement, since January 1, 2012.

In connection with the June 21, 2013 amendment and December 23, 2013 re-pricing, lenders party to the Tranche B Term Loan that held $790 million of the outstanding principal balance either partially or fully reduced their holdings. These reductions were accounted for as debt extinguishments. The remaining holdings were analyzed on a lender-by-lender basis and accounted for as debt modifications. The outstanding principal balance on the Tranche B Term Loan did not change, as new and continuing lenders acquired the $790 million.

We paid $38 million related to the call premium and other fees to re-price and amend the Original Senior Credit Agreement and to re-price the Tranche B Term Loan, of which $30 million was deferred and will be amortized over the remaining terms of the Senior Credit Facilities. We recognized a $24 million loss on extinguishment of debt, which included the write off of $13 million of unamortized debt discounts and $3 million of unamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of the call premium and fees noted above.

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Up to $200 million of the Revolving Facility may be used for the issuance of letters of credit. Prior to the final maturity date of each of the facilities, we have the option to extend the maturity date of all or a portion of these facilities with the consent of the lenders whose loans or commitments are being extended. Prior to the February 7, 2014 refinancing transaction discussed below, we had the option to increase the amount of these facilities in an aggregate principal amount not to exceed $1.2 billion, either through an additional term loan, an increase in the Revolving Facility or a combination of both, subject to certain conditions including the consent of the lenders or other institutions electing to participate in such increase. $250 million of this $1.2 billion was used to establish the additional term loan under the existing Tranche B Term Loan facility referred to below.

Mandatory prepayments are required, subject to certain exceptions, from the net cash proceeds of asset sales, insurance or condemnation proceeds, the incurrence of additional indebtedness and excess cash flow. In the case of excess cash flow, the mandatory prepayments are subject to a leverage-based step-down and are required only to the extent our liquidity exceeds a certain threshold.

The Senior Credit Facilities are secured by a senior priority security interest in substantially all of Chrysler Group LLC’s assets and the assets of its U.S. subsidiary guarantors, subject to certain exceptions. The collateral includes 100 percent of the equity interests in Chrysler Group LLC’s principal domestic subsidiaries and 65 percent of the equity interests in certain foreign subsidiaries held directly by Chrysler Group LLC or by its U.S. subsidiary guarantors.

The Senior Credit Agreement includes a number of affirmative covenants, many of which are customary, including, but not limited to, the reporting of financial results and other developments, compliance with laws, payment of taxes, maintenance of insurance and similar requirements. The Senior Credit Agreement also contains several negative covenants, including but not limited to, (i) limitations on incurrence, repayment and prepayment of certain indebtedness; (ii) limitations on incurrence of liens; (iii) limitations on making restricted payments, including a limit on declaring dividends or making distributions to our members or stockholders, as the case may be; (iv) limitations on transactions with affiliates, swap agreements and sale and leaseback transactions; (v) limitations on fundamental changes, including certain asset sales and (vi) restrictions on certain subsidiary distributions. In addition, the Senior Credit Agreement requires us to maintain a minimum ratio of borrowing base to covered debt, as well as a minimum liquidity of $3.0 billion, which includes any undrawn amounts on the Revolving Facility.

The Senior Credit Agreement contains a number of events of default related to (i) failure to make payments when due; (ii) failure to comply with covenants; (iii) breaches of representations and warranties; (iv) certain changes of control; (v) cross-default with certain other debt and hedging agreements and (vi) the failure to pay or post bond for certain material judgments. As of December 31, 2013, we were in compliance with all covenants under the Senior Credit Agreement.

New Senior Credit Facilities

On February 7, 2014, we and certain of our U.S. subsidiaries as guarantors entered into a $250 million additional term loan under the existing Tranche B Term Loan facility and a new $1,750 million term loan credit facility that matures on December 31, 2018, which we refer to as the Term Loan Credit Facility.

The outstanding principal amount of the Term Loan Credit Facility is payable in equal quarterly installments of approximately $4.4 million, commencing June 30, 2014, with the remaining balance due at maturity. All loans outstanding under the Term Loan Credit Facility bear interest, at our option, either at a base rate plus 1.50 percent per annum or at LIBOR plus 2.50 percent per annum, subject to a base rate floor of 1.75 percent per annum and a LIBOR floor of 0.75 percent per annum, respectively. We currently accrue interest based on LIBOR and the stated rate as of February 7, 2014 was 3.25 percent.

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If we voluntarily refinance or re-price all or any portion of the Term Loan Credit Facility on or before August 7, 2014, under certain circumstances, we will be obligated to pay a call premium equal to 1.00 percent of the principal amount refinanced or re-priced. After that date, we may refinance or re-price under the Term Loan Credit Facility without premium or penalty.

Subsequent to the issuances of and subject to the limitations in the Senior Credit Facilities, the Term Loan Credit Facility and the Secured Senior Notes Indenture, we have the option to increase the amount of the Revolving Facility in an aggregate principal amount not to exceed $700 million, subject to certain conditions.

The remaining terms of the Term Loan Credit Facility are generally consistent with the terms of the existing Senior Credit Facilities as of December 31, 2013.

Canadian Health Care Trust Notes

On December 31, 2010, Chrysler Canada issued four unsecured promissory notes to the HCT in an initial aggregate face value of $976 million ($974 million Canadian dollar, or CAD), which we collectively refer to as the Canadian HCT Notes. These notes were issued as part of the settlement of its obligations with respect to retiree health care benefits for CAW (now part of Unifor) represented employees, retirees and dependents, which we refer to as the Canadian Health Care Trust Settlement Agreement. In addition, the Canadian HCT Notes had accrued interest from January 1, 2010 through December 31, 2010 of $80 million ($80 million CAD) and a $31 million ($31 million CAD) net premium.

The terms of each of the notes are substantially similar and provide that each note will rankpari passu with all existing and future unsecured and unsubordinated indebtedness for borrowed money of Chrysler Canada, and that Chrysler Canada will not incur indebtedness for borrowed money that is senior in any respect in right of payment to the notes.

Payments on the Canadian HCT Notes are due on June 30 of each year unless that day is not a business day in Canada, in which case payments are due on the next business day, or the Scheduled Payment Date. Interest is accrued at the stated rate of 9.0 percent per annum for the HCT Tranche A and B notes. Accrued interest in excess of payments on the HCT Tranche A and B notes is capitalized as additional debt on the Scheduled Payment Date. We are not required to make a payment on the HCT Tranche C note until 2020. However, interest accrued at the stated rate of 7.5 percent per annum on the HCT Tranche C note will be capitalized as additional debt on the Scheduled Payment Date through 2019. In July 2013, July 2012 and June 2011, $25 million, $74 million and $27 million, respectively, of interest accrued in excess of the scheduled payments was capitalized as additional debt.

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In July 2013, we made a scheduled payment on the HCT Tranche B note of $66 million, which was composed of $44 million of interest accrued through the payment date and $22 million of interest that was previously capitalized as additional debt.

In January 2013, we made a prepayment on the HCT Tranche A note of the scheduled payment due on July 2, 2013. The amount of the prepayment, determined in accordance with the terms of the HCT Tranche A note, was $117 million and was composed of a $92 million principal payment and interest accrued through January 3, 2013 of $25 million. The $92 million HCT Tranche A note principal payment consisted of $47 million of interest that was previously capitalized as additional debt with the remaining $45 million representing a repayment of the original principal balance.

In the years ended December 31, 2012 and 2011, we made payments of $44 million and $47 million, respectively, on the Canadian HCT Notes, which included principal and interest accrued through the respective payment dates. The HCT Tranche D note was fully repaid in 2012.

The payments of capitalized interest are included as a component of Net Cash Provided by Operating Activities in the accompanying Condensed Consolidated Statements of Cash Flows.

Mexico Development Banks Credit Facilities

In July 2010, Chrysler de Mexico, our principal operating subsidiary in Mexico, entered into a financing arrangement with certain Mexican development banks which provides for a 15 year amortizing term loan facility equal to the Mexican peso equivalent of $400 million. The facility was fully drawn during July 2010 and was funded in Mexican pesos. Any amounts repaid on the facility cannot be re-borrowed.

In December 2011, Chrysler de Mexico entered into a financing arrangement with certain Mexican development banks which provides for a ten year amortizing term loan facility of 3.0 billion Mexican pesos. The facility was fully drawn during December 2011 and was funded in Mexican pesos. Principal payments on the loan are not required until 2016, and any amounts repaid cannot be re-borrowed.

The terms of these loans are similar. Chrysler de Mexico placed certain of its assets in special purpose trusts to secure repayment of the loans, including certain receivables and property, plant and equipment. As of December 31, 2013 and 2012, Chrysler de Mexico had $56 million and $66 million, respectively, of cash on deposit with the trusts, which is included in Prepaid Expenses and Other Assets in the accompanying Consolidated Balance Sheets. The loans require compliance with certain covenants, including but not limited to, limitations on liens, incurrence of debt and asset sales. As of December 31, 2013 we were in compliance with all covenants under the facilities.

Other Arrangements

From time to time, we and our subsidiaries have also entered into, and may in the future enter into, various loan arrangements to finance real estate and construction projects, inventory, receivables, working capital, and other general corporate purposes.

Intercreditor Agreement

The Issuers, the Guarantors, the collateral agent with respect to the Notes offered hereby (in such capacity, together with its successors and assigns, the “Junior Priority Representative”), and the administrative agent and collateral agents under the Senior Credit Facilities and the Term Loan Credit Facility (in such capacity, together with its successors and assigns, the “Senior Priority Representatives”) have entered into the Intercreditor Agreement, which established the relative priority of the liens securing the Senior Credit Facilities, the Term Loan Credit Facility and the Notes offered hereby.

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This summary of the Intercreditor Agreement uses the following terms:

• “Additional Junior Priority Agreement” means any agreement designated as such in writing (including by addendum to the Intercreditor Agreement) by the Senior Priority Representatives and the Junior Priority Representative in accordance with the terms of the Senior Priority Agreement and Junior Priority Agreement, respectively.

• “Additional Senior Priority Agreement” means any agreement designated as such in writing (including by addendum to the Intercreditor Agreement) by the Senior Priority Representatives and the Junior Priority Representative in accordance with the terms of the Senior Priority Agreement and Junior Priority Agreement, respectively.

• “Bankruptcy Code” means the United States Bankruptcy Code (11 U.S.C. §101 et seq.), as amended from time to time, or any successor statute.

• “Bankruptcy Law” means each of the Bankruptcy Code and any other federal, state or foreign bankruptcy, insolvency, reorganization, receivership or similar law.

• “Common Collateral” means all assets that are both collateral for the Junior Priority Obligations and collateral for the Senior Priority Obligations.

• “Comparable Junior Priority Security Document” means, in relation to any Common Collateral subject to any Senior Priority Security Document, that Junior Priority Security Document that creates a security interest in the same Common Collateral, granted by the same Credit Party, as applicable.

• “Credit Party” means (a) the Company and (b) each Subsidiary of the Company and any other Person in which the Company or any of its subsidiaries holds an ownership interest, in each case that is, at any time of determination, a party to any Senior Priority Security Document or Junior Priority Security Document.

• “DOE Pari Passu Amount” means, at any time, 50% of the principal amounts advanced under any Permitted DOE Facility minus the sum of (a) any principal amount repaid or discharged under such Permitted DOE Facility through the exercise of remedies in respect of collateral not constituting DOE Assets and (b) 50% of the aggregate principal amount otherwise repaid, prepaid or discharged under such Permitted DOE Facility; provided that the DOE Pari Passu Amount shall not at any time exceed $1,750,000,000.

• “Insolvency Proceeding” means any proceeding in respect of bankruptcy, insolvency, winding up, receivership, dissolution or assignment for the benefit of creditors, in each case whether under the Bankruptcy Code or any other Bankruptcy Law.

• “Junior Priority Agreement” means, collectively, (a) the indenture governing the Notes, (b) any Additional Junior Priority Agreement and (c) any other credit agreement, loan agreement, note agreement, promissory note, indenture, or other agreement or instrument evidencing or governing the terms of any indebtedness or other financial accommodation that has been incurred to extend, replace, refinance or refund in whole or in part the indebtedness and other obligations outstanding under the Indenture, any Additional Junior Priority Agreement or any other agreement or instrument referred to in this clause (c).

• “Junior Priority Obligations” means the due and punctual payment of (a) all principal of and interest (including any post-petition interest) and premium (if any) on all indebtedness under the

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Junior Priority Agreement, and (b) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including post-petition interest), of the Credit Parties or any of their Subsidiaries to the Junior Priority Secured Parties under the documents governing the Junior Priority Obligations, and other amounts payable from time to time pursuant to the documents governing the Junior Priority Obligations, in each case whether or not allowed or allowable in an Insolvency Proceeding. To the extent that obligations under any Permitted DOE Facility are secured by liens that are junior in lien priority to the liens securing the Senior Credit Facilities and pari passu in Lien priority to the Liens securing the Notes, the obligations under such Permitted DOE Facility shall constitute Junior Priority Obligations for purposes of the Intercreditor Agreement.

• “Junior Priority Secured Party” means the Junior Priority Representative, each creditor under any Junior Priority Agreement and any other holders of the Junior Priority Obligations.

• “Junior Priority Security Documents” means the Security Documents and any documents that are designated under the Junior Priority Agreement as “Junior Priority Security Documents” for purposes of the Intercreditor Agreement.

• “Secured Parties” means the trustee with respect to the Notes, the collateral agent with respect to the Notes, the holders of the Notes, the beneficiaries of each indemnification obligation undertaken by the Issuers or any Guarantor under any Security Document and the successors and assigns of each of the foregoing.

• “Security Documents” means the security agreements, pledge agreements, collateral assignments, mortgages, Intercreditor Agreement, the other intercreditor agreements and related agreements, as amended, supplemented, restated, renewed, refunded, replaced, restructured, repaid, refinanced or otherwise modified from time to time, creating security interests in the collateral as contemplated by the Indenture.

• “Senior Priority Agreement” means, collectively, (a) the credit agreement with respect to the Senior Credit Facilities, (b) the Term Loan Credit Agreement, (c) any Additional Senior Priority Agreement and (d) any other credit agreement, loan agreement, note agreement, promissory note, indenture or other agreement or instrument evidencing or governing the terms of any indebtedness or other financial accommodation that has been incurred to extend, replace, refinance or refund in whole or in part the commitments and/or indebtedness and other obligations outstanding under the credit agreement with respect to the Senior Credit Facilities, the Term Loan Credit Agreement, any Additional Senior Priority Agreement or any other agreement or instrument referred to in this definition unless such agreement or instrument expressly provides that it is not intended to be and is not a Senior Priority Agreement under the Intercreditor Agreement.

• “Senior Priority Obligations” means (a) all obligations of every nature of each Credit Party under the Senior Priority Documents, whether for principal, interest (including post-petition interest), reimbursement of amounts drawn under letters of credit, fees, expenses, indemnification or otherwise, (b) certain swap and designated cash management obligations and (c) to the extent constituting “Secured Obligations” under the Senior Priority Security Documents, the DOE Pari Passu Amount.

• “Senior Priority Obligations Payment Date” means the first date on which (a) the Senior Priority Obligations (including any obligations replacing, renewing or refinancing any previously existing Senior Priority Obligations, but other than the certain swap obligations and cash management obligations and those that constitute Unasserted Contingent Obligations) have been indefeasibly paid in cash in full (or cash collateralized or defeased in accordance with the terms of the Senior

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Priority Documents), (b) all commitments to extend credit under the Senior Priority Documents (including any documents replacing, renewing or refinancing any previously existing Senior Priority Documents) have been terminated or expired and no letter of credit is outstanding and (c) the Senior Priority Representatives have delivered a written notice to the Junior Priority Representative stating that the events described in clauses (a) and (b) have occurred, such notice not to be unreasonably withheld.

• “Senior Priority Secured Party” means (a) each agent under any Senior Priority Agreement and (b) each creditor under any Senior Priority Agreement and includes, without limitation, all former agents and creditors under any Senior Priority Agreement to the extent that any Senior Priority Obligations owing to such Persons were incurred while such Persons were agents or creditors under any Senior Priority Agreement and such Senior Priority Obligations have not been paid or satisfied in full.

• “Unasserted Contingent Obligations” means, at any time, Senior Priority Obligations for taxes, costs, indemnifications, reimbursements, damages and other liabilities (excluding (a) the principal of, and interest and premium (if any) on, and fees and expenses relating to, any Senior Priority Obligation and (b) contingent reimbursement obligations in respect of amounts that may be drawn under outstanding letters of credit or similar instruments) in respect of which no assertion of liability (whether oral or written) and no claim or demand for payment (whether oral or written) has been made (and, in the case of Senior Priority Obligations for indemnification, no notice for indemnification has been issued by the indemnitee) at such time.

The Intercreditor Agreement may be amended from time to time without the consent of the secured parties thereto to add other secured parties.

Lien Priorities

Pursuant to the Intercreditor Agreement, any and all liens on the Common Collateral whether existing on the issue date of the Notes or created in the future in favor of any Junior Priority Secured Party, including the holders of the Notes, regardless of how acquired, whether by grant, statute, operation of law, judgment rendered in any judicial proceeding, subrogation or otherwise, are expressly made and agreed to be junior in priority, operation and effect to any and all liens whether existing on the issue date or created in the future in favor of the Senior Priority Secured Parties securing the Senior Priority Obligations, notwithstanding (i) anything to the contrary in any contract or filing, and regardless of the time, order or method of grant, attachment, recording or perfection of any financing statements or other security interests, assignments, pledges, deeds, mortgages and other liens, charges or encumbrances or any defect or deficiency or alleged defect or deficiency in any of the foregoing, (ii) any provision of the Uniform Commercial Code or any other applicable law or any other circumstance whatsoever and (iii) the fact that any such liens in favor of any Senior Priority Secured Party securing any of the Senior Priority Obligations may be otherwise subordinated, voided, avoided, invalidated or lapsed.

New Liens

So long as the Senior Priority Obligations Payment Date has not occurred, the Intercreditor Agreement provides that (a) there shall be no lien, and no Credit Party shall have any right to create any lien, on any assets of any Credit Party securing any Junior Priority Obligation if those same assets are not subject to, and do not become subject to, a lien securing the Senior Priority Obligations and (b) if any Junior Priority Secured Party shall acquire or hold any lien on any assets of any Credit Party securing any Junior Priority Obligation which assets are not also subject to a lien in favor of the Senior Priority Secured Parties under the Senior Priority Documents, then such Junior Priority Secured Party shall be deemed to also hold and have held such lien for the benefit of the Senior Priority Secured Parties.

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Enforcement and Other Rights

Pursuant to the terms of the Intercreditor Agreement, at any time prior to the Senior Priority Obligations Payment Date, the Senior Priority Representatives will determine the time and method by which the security interests in the Common Collateral will be enforced. The Junior Priority Representative will not be permitted to enforce the security interests even if an Event of Default under the Indenture has occurred and the Notes have been accelerated except (a) in any Insolvency Proceeding, as necessary to file a proof of claim or statement of interest with respect to the liens in favor of the Notes or (b) as necessary to take any action (not adverse to the liens on the Common Collateral securing the Senior Priority Obligations, or the rights of either the Senior Priority Representatives or the other Senior Priority Secured Parties to exercise remedies in respect thereof) in order to create, prove, perfect, preserve or protect (but not enforce) its rights in, and the perfection and priority of its liens on the Common Collateral.

Pursuant to the Intercreditor Agreement, the Junior Priority Representative agreed for itself and the other Junior Priority Secured Parties that until the Senior Priority Obligations Payment Date has occurred:

(a) they will not take or cause to be taken any action, the purpose or effect of which is to make any lien in respect of any Junior Priority Obligation pari passu with or senior to, or to give any Junior Priority Secured Party any preference or priority relative to, the liens with respect to the Senior Priority Obligations or the Senior Priority Secured Parties with respect to any of the Common Collateral;

(b) they will not contest, oppose, object to, interfere with, hinder or delay, in any manner, whether by judicial proceedings (including the filing of an Insolvency Proceeding) or otherwise, any foreclosure, sale, lease, exchange, transfer or other disposition of the Common Collateral or any other collateral which secures the Senior Priority Obligations by any Senior Priority Secured Party or any other enforcement action taken (or any forbearance from taking any enforcement action) by or on behalf of any Senior Priority Secured Party;

(c) they have no right to (i) direct either the Senior Priority Representatives or any other Senior Priority Secured Party to exercise any right, remedy or power with respect to the Common Collateral or pursuant to the Senior Priority Security Documents or (ii) consent or object to the exercise by the Senior Priority Representatives or any other Senior Priority Secured Party of any right, remedy or power with respect to the Common Collateral or pursuant to the Senior Priority Security Documents or to the timing or manner in which any such right is exercised or not exercised (or, to the extent they may have any such right described in this clause (c), whether as a junior lien creditor or otherwise, they will waive such right);

(d) they will not institute any suit or other proceeding or assert in any suit, Insolvency Proceeding or other proceeding any claim against any Senior Priority Secured Party seeking damages from or other relief by way of specific performance, instructions or otherwise, with respect to, and no Senior Priority Secured Party shall be liable for, any action taken or omitted to be taken by any Senior Priority Secured Party with respect to the Common Collateral or pursuant to the Senior Priority Documents;

(e) they will not make any judicial or nonjudicial claim or demand or commence any judicial or non-judicial proceedings against any Credit Party or any of its Subsidiaries or Affiliates under or with respect to any Junior Priority Security Document seeking payment or damages from or other relief by way of specific performance, instructions or otherwise under or with respect to any Junior Priority Security Document or exercise any right, remedy or power under or with respect to, or otherwise take any action to enforce, any Junior Priority Security Document;

(f) they will not commence judicial or nonjudicial foreclosure proceedings with respect to, seek to have a trustee, receiver, liquidator or similar official appointed for or over, or attempt any action to take

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possession of any Common Collateral, or exercise any right, remedy or power with respect to, or otherwise take any action to enforce their interest in or realize upon, the Common Collateral or pursuant to the Junior Priority Security Documents;

(g) they will not seek, and will waive any right, to have the Common Collateral or any part thereof marshaled upon any foreclosure or other disposition of the Common Collateral and will waive, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the Common Collateral or any other similar rights a junior secured creditor may have under applicable law; and

(h) they will not object to the forbearance by the Senior Priority Secured Parties from bringing or pursuing any foreclosure proceeding or action or any other exercise of any rights or remedies relating to the Common Collateral or any other collateral securing the Senior Priority Obligations.

In addition, the Intercreditor Agreement provides that, prior to the Senior Priority Obligations Payment Date, (1) the holders of Senior Priority Obligations and the Senior Priority Representatives shall have the exclusive right to make determinations regarding the release of Common Collateral without the consent of the holders of the Notes and (2) in the event the Senior Priority Representatives enter into any amendment, waiver or consent in respect of any of the Senior Priority Security Documents for the purpose of adding to, or deleting from, or waiving or consenting to any departures from any provisions of, any Senior Priority Security Document or changing in any manner the rights of any parties thereunder, then, subject to certain limitations, such amendment, waiver or consent shall apply automatically to any comparable provision of the Comparable Junior Priority Security Document without the consent of or action by any secured party under any Junior Priority Security Document.

Distribution of Enforcements Proceeds

All proceeds of Common Collateral (including any interest earned thereon) resulting from the sale, collection or other disposition of Common Collateral resulting from any enforcement action or that occurs after any Event of Default (as defined in the documents governing the Senior Priority Obligations and the security interests with respect thereto, including the credit agreement for the Senior Credit Facilities and the Term Loan Credit Agreement (the “Senior Priority Documents”)), whether or not pursuant to an Insolvency Proceeding or during the pendency of any Insolvency Proceeding, shall be distributed first to the Senior Priority Representatives for application to the Senior Priority Obligations in accordance with the terms of the Senior Priority Documents, until the Senior Priority Obligations have been paid in full and the Senior Priority Obligations Payment Date has occurred. Thereafter, the Junior Priority Representative in accordance with the provisions of the Indenture and the Junior Priority Security Documents will distribute all cash proceeds (after payment of the costs of enforcement and collateral administration and any other amounts owed to the Junior Priority Representative) of the collateral received by it under the Junior Priority Security Documents for the ratable benefit of the holders of the Notes and the other Junior Priority Secured Parties.

Until the occurrence of the Senior Priority Obligations Payment Date, any Common Collateral, including any Common Collateral constituting proceeds, that may be received by the Junior Priority Representative or any secured party under any Junior Priority Security Document in violation of the Intercreditor Agreement shall be segregated and held in trust and promptly paid over to the Senior Priority Representatives, for the benefit of the Senior Priority Secured Parties.

Upon (i) any sale or other disposition of Common Collateral permitted pursuant to the terms of the Senior Priority Documents that results in the release of the lien in favor of the Senior Priority Obligations on any Common Collateral (including any sale or other disposition pursuant to any enforcement action) or (ii) any other release of Common Collateral from the lien created by the security documents with respect to the Senior Priority

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Obligations (the “Senior Priority Security Documents”) that is permitted pursuant to the terms of the Senior Priority Documents, the liens with respect to the Junior Priority Obligations on such Common Collateral (excluding any portion of the proceeds of such Common Collateral remaining after the Senior Priority Obligations Payment Date occurs) shall be automatically and unconditionally released with no further consent or action of any Person.

Insolvency Proceedings

In addition, if the Issuers or any Guarantor is subject to any Insolvency Proceeding, the Junior Priority Representative and the other Junior Priority Secured Parties will agree that:

(1) if the Senior Priority Representatives shall desire to permit the use of cash collateral or to permit the Issuers or any Guarantor to obtain financing under Section 363 or Section 364 of Title 11 of the Bankruptcy Code or any similar provision in any Bankruptcy Law (“DIP Financing”), then the Junior Priority Representative and the other Junior Priority Secured Parties agree not to object to such use of cash collateral or DIP Financing and will not request or accept adequate protection or any other relief in connection therewith and, to the extent the liens securing the Senior Priority Obligations are subordinated or pari passu with such DIP Financing, will subordinate its liens in the collateral to such DIP Financing (and all Obligations relating thereto) on the same basis as they are subordinated to the Senior Priority Obligations;

(2) they will not seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of the Common Collateral, without the prior written consent of the Senior Priority Representatives and the required lenders under the Senior Priority Agreement;

(3) they will not object to, and will not otherwise contest any order relating to a sale of assets of the Issuer or any Guarantor for which the Senior Priority Representatives have consented that provides, to the extent the sale is to be free and clear of liens, that the liens securing the Senior Priority Obligations and the Notes will attach to the proceeds of the sale on the same basis of priority as the existing liens in accordance with the Intercreditor Agreement;

(4) they will not object to, contest or support (or support any other Person objecting to or contesting to) (a) any request by the Senior Priority Representatives or the holders of Senior Priority Obligations for adequate protection or (b) any objection by the Senior Priority Representatives or the holders of Senior Priority Obligations to any motion, relief, action or proceeding based on the Senior Priority Representatives’ or the holders of Senior Priority Obligations’ claiming a lack of adequate protection or (c) the payment of interest, fees, expenses, costs, charges or other amounts to the Senior Priority Representatives under Section 506(b) or 506(c) of the Bankruptcy Code or otherwise. Notwithstanding the foregoing, in any Insolvency Proceeding, (i) if the holders of Senior Priority Obligations (or any subset thereof) are granted adequate protection in the form of additional collateral in connection with any DIP Financing or use of cash collateral, then the Junior Priority Representative (A) may seek or request adequate protection in the form of a replacement lien on such additional collateral, which lien is subordinated to the liens securing (x) the Senior Priority Obligations and (y) such DIP Financing (and all Obligations relating thereto) on the same basis as the other liens securing the Notes are so subordinated to the liens securing Senior Priority Obligations under the Intercreditor Agreement, and (ii) in the event the Junior Priority Representative seeks or requests adequate protection and such adequate protection is granted in the form of additional collateral, then the Junior Priority Representative and the other Junior Priority Secured Parties agree that the holders of the Senior Priority Obligations shall also be granted a senior lien on such additional collateral as security for the applicable Senior Priority Obligations and any such DIP Financing and that any lien on such additional collateral securing the Notes shall be subordinated to (x) the liens on such collateral securing the Senior Priority Obligations and (y) any such DIP Financing (and all Obligations relating thereto) and any other liens

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granted to the holders of Senior Priority Obligations as adequate protection on the same basis as the other liens securing the Notes are so subordinated to such liens securing Senior Priority Obligations under the Intercreditor Agreement;

(5) no Junior Priority Secured Party shall support or vote in favor of any plan of reorganization unless such plan (a) pays off, in cash in full, all Senior Priority Obligations or (b) is accepted by the class of holders of Senior Priority Obligations voting thereon; and

(6) until the Senior Priority Obligations Payment Date has occurred, the Junior Priority Representative, on behalf of itself and each other Junior Priority Secured Party, agrees that it (i) will not assert or enforce any claim under Section 506(c) of the Bankruptcy Code senior to or on a parity with the liens securing the Senior Priority Obligations for costs or expenses of preserving or disposing of any Common Collateral, and (ii) waives any claim it may have arising out of the election by any holder of Senior Priority Obligations of the application of Section 1111(b)(2) of the Bankruptcy Code.

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DESCRIPTION OF THE NOTES

General

Chrysler Group LLC, a Delaware limited liability company (the “Company”), and CG Co-Issuer Inc., a Delaware corporation and wholly owned subsidiary of the Company (the “Co-Issuer” and, together with the Company, the “Issuers”), issued the old notes and will issue the Notes under an indenture (the “Indenture”), dated as of May 24, 2011, by and among the Issuers, the Guarantors, Wilmington Trust, National Association (as successor by merger to Wilmington Trust FSB), as Trustee, Citibank, N.A., as the paying agent (in such capacity, the “Paying Agent”), as registrar (in such capacity, the “Registrar”) and as collateral agent (in such capacity, the “Collateral Agent”), as amended by the first supplemental indenture thereto, dated as of February 2, 2012, and the second supplemental indenture thereto, dated as of April 5, 2013.

The Issuers will be jointly and severally liable for all obligations under the Notes. The Co-Issuer was incorporated in 2011 as a special purpose finance subsidiary solely to facilitate the offering of the Notes. The Co-Issuer does not and will not have any substantial operations, assets or revenues. Accordingly, you should not expect the Co-Issuer to participate in making any payments on the Notes.

The following summary of the Indenture, the Notes, the Registration Rights Agreement, the Intercreditor Agreement and the other Security Documents does not include all of the information in these documents. The following summary is qualified by reference to these documents, copies of which may be obtained, when available, from the Company at its address set forth under the headingWhere You Can Find More Information in this prospectus. Certain capitalized and other terms used in thisDescription of the Notes section and not otherwise defined have the meanings set forth in the section —Certain Definitions and Conventions. As used in thisDescription of the Notes section, (i) the terms “we,” “us” and “our” mean the Company and its Subsidiaries and (ii) the terms “Company” and “Chrysler” mean Chrysler Group LLC, and not any of its Subsidiaries.

Unless the context otherwise requires, (i) references in thisDescription of the Notes section to the Notes include the 2019 Notes and the 2021 Notes, (ii) references to the 2019 Notes include the 2019 Notes and the old 2019 Notes, and (iii) references to the 2021 Notes include the 2021 Notes and the old 2021 Notes. However, the 2019 Notes and the 2021 Notes are two separate series of Notes under the Indenture for purposes of, among other things, payments of principal and interest, redemptions, offers to purchase and consenting to certain amendments to the Indenture and the Notes and waiving or rescinding certain Defaults. The Notes are intended to be secured by security interests junior in priority to the security interests securing our existing First-Priority Lien Obligations, including the Senior Credit Facilities and the Term Loan Credit Facility.

The Issuers may issue additional 2019 Notes (collectively, “Additional 2019 Notes”) and additional 2021 Notes (collectively, “Additional 2021 Notes” and, together with the Additional 2019 Notes, the “Additional Notes”) from time to time. Any offering of Additional Notes is subject to the covenant described below under the caption —Certain Covenants in the Indenture —Liens. The 2019 Notes and any Additional 2019 Notes subsequently issued under the Indenture will be treated as a single class for all purposes under the Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase; and the 2021 Notes and any Additional 2021 Notes subsequently issued under the Indenture will be treated as a single class for all purposes under the Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. Holders of the Notes and Additional Notes actually issued will share equally and ratably in the Collateral. Unless the context otherwise requires, for all purposes of the Indenture and thisDescription of the Notes, (i) references to the 2019 Notes include any 2019 Notes and Additional 2019 Notes actually issued, (ii) references to the 2021 Notes include any 2021 Notes and Additional 2021 Notes actually issued and (iii) references to the Notes include any Notes and any Additional Notes actually issued.

The 2019 Notes are Additional 2019 Notes to the $1,500,000,000 aggregate principal amount of 2019 Notes previously issued under the Indenture on May 24, 2011, or if exchanged for registered Existing 2019 Notes,

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February 2, 2012. The 2021 Notes are Additional 2021 Notes to the $1,700,000,000 aggregate principal amount of 2021 Notes previously issued under the Indenture on May 24, 2011, or if exchanged for registered Existing 2021 Notes, February 2, 2012.

Principal of, premium, if any, and interest on the Notes will be payable, and the Notes may be exchanged or transferred, at the office or agency designated by the Issuer (which initially shall be the principal corporate trust office of the Paying Agent).

The Notes will be issued only in fully registered form, without coupons, in minimum denominations of $200,000 and any integral multiple of $1,000 in excess thereof. No service charge will be made for any registration of transfer or exchange of Notes, but the Issuers and Registrar may require payment of a sum sufficient to cover any transfer tax or other similar governmental charge payable in connection therewith.

Brief Description of the Notes

The Notes:

• will be the joint and several obligations of the Issuers;

• will be senior in right of payment to all Indebtedness of the Issuers which is by its terms subordinated in right of payment to the Notes;

• will rankpari passu in right of payment with respect to all existing and future unsubordinated indebtedness of the Issuers, including the Senior Credit Facilities;

• will be secured by a junior-priority lien in the Collateral (subject to the prior Liens securing First-Priority Lien Obligations and to Permitted Liens) to the extent described under —Security;

• will be effectively junior to any obligations of the Issuers that are either (i) secured by a Lien on the Collateral that is senior or prior to the Liens securing the Notes, including the Liens securing First-Priority Lien Obligations and Permitted Liens, or (ii) secured with property or assets that do not constitute Collateral, including the DOE Assets, to the extent of the value of the assets securing such Indebtedness;

• will be initially guaranteed on a senior secured basis by each of the Company’s domestic Restricted Subsidiaries that guarantee the Senior Credit Facilities; and

• will be structurally subordinated to all existing and future obligations of any existing or future Subsidiaries of the Company that do not guarantee the Notes, including all of the Company’s subsidiaries that are not Domestic Subsidiaries.

Principal, Maturity and Interest

The 2019 Notes will be issued initially in an aggregate principal amount of $1,375,000,000 and the 2021 Notes will be issued initially in an aggregate principal amount of $1,380,000,000. The 2019 Notes are Additional 2019 Notes to the $1,500,000,000 aggregate principal amount of 2019 Notes previously issued under the Indenture on May 24, 2011, or if exchanged for registered Notes, February 2, 2012. The 2021 Notes are Additional 2021 Notes to the $1,700,000,000 aggregate principal amount of 2021 Notes previously issued under the Indenture on May 24, 2011, or if exchanged for registered Notes, February 2, 2012. We may again issue Additional Notes under the Indenture from time to time. There is currently $2,875,000,000 aggregate principal amount of 2019 Notes and $3,080,000,000 aggregate principal amount of 2021 Notes outstanding, and the outstanding principal amount will remain the same following the issuance of the Notes and the exchange offers.

The 2019 Notes will mature on June 15, 2019 and the 2021 Notes will mature on June 15, 2021, and, in each case, will be payable at par in cash at maturity. The 2019 Notes will bear interest at a rate of 8% per annum, and

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the 2021 Notes will bear interest at a rate of 8 ¹⁄₄% per annum, each from December 15, 2013, or from the most recent date to which interest has been paid or provided for. The Issuers will pay interest on overdue principal at 1% per annum in excess of the interest otherwise payable by the Issuers and will pay interest on overdue installments due from the Issuers at such higher rate to the extent lawful. Interest will be payable semiannually in cash to Holders of record at the close of business on the June 1 or December 1 immediately preceding the interest payment date, on June 15 and December 15 of each year, commencing June 15, 2014. Interest will be paid on the basis of a 360-day year consisting of twelve 30-day months.

Additional interest may accrue on the old notes in certain circumstances pursuant to the Registration Rights Agreement. All references in the Indenture and this “Description of the Notes”, in any context, to any interest or other amount payable on or with respect to the Notes shall be deemed to include any additional interest that may accrue pursuant to the Registration Rights Agreement.

Mandatory Redemption; Offers to Purchase; Open Market Purchases

The Company is not required to make any mandatory redemption or sinking fund payments with respect to the Notes. Under certain circumstances, the Company may be required to offer to purchase Notes as described under the caption—Repurchase at the Option of Holders. We and our Affiliates may at any time and from time to time purchase Notes in the open market, in negotiated transactions or otherwise.

Optional Redemption

Except as set forth below, the Issuers shall not be permitted to redeem the Notes.

2019 Notes

At any time and from time to time prior to June 15, 2015, the Company may redeem the 2019 Notes, in whole or in part, upon notice as described under—Selection and Notice, at a redemption price equal to 100% of the principal amount of 2019 Notes redeemed plus the Applicable Premium as of the date of redemption (the “Redemption Date”),and, without duplication, accrued and unpaid interest to the Redemption Date, subject to the rights of Holders of 2019 Notes on the relevant record date to receive interest due on the relevant interest payment date. The Company may provide in such notice that payment of the redemption price and performance of the Issuers’ obligations with respect to such redemption or purchase may be performed by another Person and may, at the Company’s discretion, be subject to one or more conditions precedent.

On and after June 15, 2015, the Company may redeem the 2019 Notes, in whole or in part, upon notice as described under—Selection and Notice, at any time and from time to time at the redemption prices (expressed as a percentage of principal amount) set forth below. The Company may provide in such notice that the payment of the redemption price and the performance of the Issuers’ obligations with respect to such redemption may be performed by another Person and may, at the Company’s discretion, be subject to one or more conditions precedent. The 2019 Notes will be redeemable at the redemption prices (expressed as percentages of principal amount of the 2019 Notes to be redeemed) set forth below plus accrued and unpaid interest thereon to the applicable Redemption Date, subject to the right of Holders of record of 2019 Notes on the relevant record date to receive interest due on the relevant interest payment date, if redeemed during the twelve-month period beginning on June 15 of each of the years indicated below:

Year	Percentage
2015		104.000%
2016		102.000%
2017 and thereafter		100.000%

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In addition, at any time and from time to time prior to June 15, 2014, the Company may redeem 2019 Notes (which includes Additional 2019 Notes, if any) in an aggregate principal amount not to exceed 35% of the aggregate principal amount of the 2019 Notes (which includes Additional 2019 Notes, if any) originally issued, upon notice as described under —Selection and Notice, at a redemption price of 108.000% of the principal amount of the 2019 Notes redeemed, plus accrued and unpaid interest to the redemption date, with the net cash proceeds to the Company from one or more Equity Offerings,provided, however, that at least 65% of such aggregate principal amount of 2019 Notes (which includes Additional 2019 Notes, if any) remains outstanding immediately after the occurrence of each such redemption (other than 2019 Notes held, directly, or indirectly, by the Company or its Affiliates), and each such redemption occurs within 90 days after the date of the related Equity Offering.

The Company may provide in such notice that payment of the redemption price and performance of the Issuers’ obligations with respect thereto may be performed by another Person. Notice of any redemption upon any Equity Offering may be given prior to the completion of the related Equity Offering, and any such redemption or notice may, at the Company’s discretion, be subject to one or more conditions precedent, including, but not limited to, completion of the related Equity Offering.

The Notes to be redeemed shall be determined in the manner described under —Selection and Notice.

2021 Notes

At any time and from time to time prior to June 15, 2016, the Company may redeem the 2021 Notes, in whole or in part, upon notice as described under —Selection and Notice, at a redemption price equal to 100% of the principal amount of 2021 Notes redeemed plus the Applicable Premium as of the date of redemption (the “Redemption Date”),and, without duplication, accrued and unpaid interest to the Redemption Date, subject to the rights of Holders of 2021 Notes on the relevant record date to receive interest due on the relevant interest payment date. The Company may provide in such notice that payment of the redemption price and performance of the Issuers’ obligations with respect to such redemption or purchase may be performed by another Person and may, at the Company’s discretion, be subject to one or more conditions precedent.

On and after June 15, 2016, the Company may redeem the 2021 Notes, in whole or in part, upon notice as described under —Selection and Notice, at any time and from time to time at the redemption prices (expressed as a percentage of principal amount) set forth below. The Company may provide in such notice that the payment of the redemption price and the performance of the Issuers’ obligations with respect to such redemption may be performed by another Person and may, at the Company’s discretion, be subject to one or more conditions precedent. The 2021 Notes will be redeemable at the redemption prices (expressed as percentages of principal amount of the 2021 Notes to be redeemed) set forth below plus accrued and unpaid interest thereon to the applicable Redemption Date, subject to the right of Holders of record of 2021 Notes on the relevant record date to receive interest due on the relevant interest payment date, if redeemed during the twelve-month period beginning on June 15 of each of the years indicated below:

Year	Percentage
2016		104.125	%
2017		102.750	%
2018		101.375	%
2019 and thereafter		100.000	%

In addition, at any time and from time to time prior to June 15, 2014, the Company may redeem 2021 Notes (which includes Additional 2021 Notes, if any) in an aggregate principal amount not to exceed 35% of the aggregate principal amount of the 2021 Notes (which includes Additional 2021 Notes, if any) originally issued, upon notice as described under —Selection and Notice, at a redemption price of 108.250% of the principal

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amount of the 2021 Notes redeemed, plus accrued and unpaid interest to the redemption date, with the net cash proceeds to the Company from one or more Equity Offerings,provided, however, that at least 65% of such aggregate principal amount of 2021 Notes (which includes Additional 2021 Notes, if any) remains outstanding immediately after the occurrence of each such redemption (other than 2021 Notes held, directly, or indirectly, by the Company or its Affiliates), and each such redemption occurs within 90 days after the date of the related Equity Offering.

The Company may provide in such notice that payment of the redemption price and performance of the Issuers’ obligations with respect thereto may be performed by another Person. Notice of any redemption upon any Equity Offering may be given prior to the completion of the related Equity Offering, and any such redemption or notice may, at the Company’s discretion, be subject to one or more conditions precedent, including, but not limited to, completion of the related Equity Offering.

The Notes to be redeemed shall be determined in the manner described under —Selection and Notice.

Repurchase at the Option of Holders

Change of Control Event

Each series of Notes will provide that if a Change of Control Event occurs, unless the Company has previously or concurrently mailed a redemption notice with respect to all the then outstanding Notes of such series as described under —Optional Redemption, the Company will make an offer to purchase all of the Notes pursuant to the offer described below (the “Change of Control Offer”) at a price in cash (the “Change of Control Payment”) equal to 101.0% of the aggregate principal amount thereof, together with accrued and unpaid interest, if any, to the date of purchase, subject to the right of Holders of record of such series of Notes on the relevant record date to receive interest due on the relevant interest payment date. In connection with any Change of Control Event (but not later than 30 days following any Change of Control Event), the Company will send notice of such Change of Control Offer by first-class mail, with a copy to the Trustee, the Paying Agent and the Registrar, to each Holder of Notes of such series to the address of such Holder appearing in the security register, or otherwise in accordance with the procedures of DTC, with the following information:

(1) that a Change of Control Offer is being made pursuant to the covenant entitled —Repurchase at the Option of Holders—Change of Control Event, and that all Notes properly tendered pursuant to such Change of Control Offer will be accepted for payment by the Company;

(2) the purchase price and the purchase date, which will be no earlier than 30 days nor later than 60 days from the date such notice is mailed (the “Change of Control Payment Date”);

(3) that any Note not properly tendered will remain outstanding and continue to accrue interest;

(4) that unless the Company defaults in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest on the Change of Control Payment Date;

(5) that Holders will be entitled to withdraw their tendered Notes and their election to require the Company to purchase such Notes,provided, however, that the Paying Agent receives, not later than the close of business on the fifth Business Day preceding the Change of Control Payment Date a facsimile or electronic mail transmission or a letter setting forth the name of the Holder of the Notes, the principal amount of Notes tendered for purchase, and a statement that such Holder is withdrawing its tendered Notes and its election to have such Notes purchased;

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(6) that the Holders whose Notes are being repurchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered, provided that the unpurchased portion of the Notes must be equal to a minimum of $200,000 and an integral multiple of $1,000 in principal amount;

(7) if such notice is mailed prior to the occurrence of a Change of Control Event, stating that the Change of Control Offer is conditional on the occurrence of such Change of Control Event; and

(8) other instructions, as determined by the Company, consistent with the covenant described hereunder, that a Holder must follow to tender its Notes.

The Company will comply with the requirements of Section 14(e) of the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of Notes by the Company pursuant to a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of the Indenture, the Company will comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations described in the Indenture by virtue thereof.

On the Change of Control Payment Date, the Company will, to the extent permitted by law,

(1) accept for payment all Notes or portions thereof properly tendered pursuant to the Change of Control Offer,

(2) deposit with the Paying Agent an amount equal to the aggregate Change of Control Payment in respect of all Notes or portions thereof so tendered, and

(3) deliver, or cause to be delivered, to the Registrar for cancellation (and delivery to the Paying Agent if the Registrar and Paying Agent are separate entities) the Notes so accepted together with an Officer’s Certificate to the Registrar stating that such Notes or portions thereof have been tendered to and purchased by the Company.

The Senior Credit Facilities do, and future credit agreements or other agreements to which the Company may become a party may, provide that certain change of control events with respect to the Company may constitute a default thereunder. If we experience a change of control that triggers a default under our Senior Credit Facilities, we could seek a waiver of such default or repay or seek to refinance our Senior Credit Facilities. In the event we do not obtain such a waiver or refinance the Senior Credit Facilities, such default could result in amounts then outstanding under our Senior Credit Facilities being declared due and payable.

Our ability to pay cash to the Holders of Notes following the occurrence of a Change of Control Event will be limited by our then-existing financial resources. In addition, because the security interests securing the Notes and the Guarantees will be junior in priority to any and all security interests at any time granted in the Collateral to secure the First-Priority Lien Obligations, the proceeds of any Collateral will be used to first satisfy all of our Obligations under the First-Priority Lien Obligations. Therefore, sufficient funds may not be available when necessary to make any required repurchases. SeeRisk Factors —Risks Related to Our Structure, the Notes and the Exchange Offers —We may not be able to repurchase notes upon a change of control.

The Change of Control Event purchase feature of the Notes may in certain circumstances make it more difficult or discourage a sale or takeover of us. Subject to the limitations discussed below, we could, in the future, enter into certain transactions, including acquisitions, dispositions, refinancings or other recapitalizations, that would not constitute a Change of Control under the Indenture, but that could increase the amount of indebtedness outstanding at such time or otherwise affect our capital structure or credit ratings. The Indenture does not restrict our ability to incur unsecured Indebtedness. Restrictions on our ability to incur Secured Indebtedness are limited

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to those contained in the covenant described under—Certain Covenants in the Indenture —Liens. The Indenture does not contain any other covenants or provisions that afford Holders of the Notes protection in the event of a highly leveraged transaction. These limitations are subject to a number of important exceptions, baskets and qualifications.

We will not be required to make a Change of Control Offer following a Change of Control Event if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer. Notwithstanding anything to the contrary herein, a Change of Control Offer may be made in advance of a Change of Control Event, conditional upon the Change of Control, if a definitive agreement is in place for the Change of Control at the time of making of the Change of Control Offer.

The definition of “Change of Control” includes a disposition of all or substantially all of the assets of the Company and its Restricted Subsidiaries to any Person other than Fiat S.p.A. and its controlled Affiliates (other than the Company and its Subsidiaries). Although there is a limited body of case law interpreting the phrase “substantially all,” there is no precise established definition of the phrase under applicable law. Accordingly, in certain circumstances there may be a degree of uncertainty as to whether a particular transaction would involve a disposition of “all or substantially all” of the assets of the Company and its Restricted Subsidiaries. As a result, it may be unclear as to whether a Change of Control Event has occurred and whether the Company is required to make an offer to repurchase the Notes as described above.

Except as described in clause (11) of the second paragraph under —Amendment, Supplement and Waiver, the provisions in the Indenture relative to the Issuers’ obligation to make an offer to repurchase the Notes as a result of a Change of Control Event may be waived or modified, with respect to any series of Notes, at any time with the written consent of the Holders of a majority in principal amount of the then outstanding Notes of such series under the Indenture.

The acquisition by Fiat of 100% of our membership interests did not constitute a Change of Control under the Indenture.

Asset Sales

The Indenture provides that the Company will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale, unless:

(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the fair market value (as determined in good faith by the Company as of the date of the consummation of the Asset Sale and without giving effect to any adjustment not then determined or any subsequent changes in value) of the assets sold or otherwise disposed of;

(2) at least 75% of the consideration therefor received (as determined in good faith by the Company) by the Company or such Restricted Subsidiary, as the case may be, is in the form of Cash Equivalents;provided, however, that the amount of:

(a) any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto) of the Company or such Restricted Subsidiary, other than any liabilities that are by their terms subordinated in right of payment to the Notes (or Guarantees) or that are owed to the Company or a Restricted Subsidiary, that are assumed by the transferee of any such assets and for which the Company and all of its Restricted Subsidiaries have been validly released by all creditors in writing, or otherwise cease to be Obligations of the Company or any Restricted Subsidiary, and

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(b) any securities, notes or other obligations or assets received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received) within 365 days following the closing of such Asset Sale,

shall be deemed to be cash for purposes of this clause (2) and for no other purpose; and

(3) if such Asset Sale involves the disposition of Collateral,

(a) such Asset Sale complies with the applicable provisions of the Security Documents; and

(b) to the extent required by the Security Documents or the covenants in the Indenture, all consideration received in such Asset Sale shall be expressly made subject to Liens under the Security Documents.

Within 540 days after the receipt of any Net Proceeds of any Asset Sale by the Company or any Restricted Subsidiary, the Company or such Restricted Subsidiary, at its option, may apply the Net Proceeds from such Asset Sale to:

(1) permanently reduce any Indebtedness constituting First-Priority Lien Obligations (and, in the case of revolving Obligations, to correspondingly reduce commitments with respect thereto) or any Pari Passu Lien Obligations;provided, however, that if the Issuers or any Guarantor shall so reduce any Pari Passu Lien Obligations, the Company will equally and ratably reduce Indebtedness under the Notes by making an offer to all holders of Notes to purchase at a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, the pro rata principal amount of the Notes) such offer to be conducted in accordance with the procedures set forth for an Asset Sales Offer but without any further limitation in amount; or

(2) in the case of an Asset Sale not involving the disposition of Collateral, permanently reduce (a) any senior unsecured Indebtedness (and, in the case of revolving Indebtedness, to correspondingly reduce commitments with respect thereto) or (b) Indebtedness of a Restricted Subsidiary that is not a Guarantor (and, in the case of revolving Indebtedness, to correspondingly reduce commitments with respect thereto) so long as the Net Proceeds of the Asset Sale are with respect to assets owned by such Restricted Subsidiary that is not a Guarantor and the Net Proceeds of such Asset Sale are received by such Restricted Subsidiary as a result of an Asset Sale by such Restricted Subsidiary; or

(3) (a) make an Investment in any one or more businesses in compliance with—Certain Covenants in the Indenture —Line of Business,(b) acquire properties or (c) acquire other assets that, in the case of each of clause (a), (b) and (c), either (x) are used or useful in a Similar Business or (y) replace the businesses, properties or assets that are the subject of such Asset Sale; andprovided further, however, that, in the case of an Asset Sale involving the disposition of Collateral, the assets acquired, directly or indirectly, with Net Proceeds from an Asset Sale applied pursuant to this clause (3) shall become Collateral; and

provided further, however,that, in the case of clause (3) above, a binding commitment shall be treated as a permitted application of the Net Proceeds from the date of such commitment so long as the Company or such other Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Proceeds will be applied to satisfy such commitment within the later of 540 days after receipt of such Net Proceeds and 180 days following such commitment and the Net Proceeds are so appliedprovided further, however,that if such commitment is cancelled or terminated after the later of such 540 day or 180 day period for any reason before such Net Proceeds are applied, then the portion of the Net Proceeds for which the commitment is canceled or terminated shall constitute Excess Proceeds.

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Any Net Proceeds from any Asset Sale described in the preceding paragraph that are not invested or applied as provided and within the 540-day time period (or as such period may be extended by up to 180 days) set forth in the preceding paragraph will be deemed to constitute “Excess Proceeds,” except the amount of Excess Proceeds will be reduced by an amount equal to the difference between (x) the principal amount of the Notes offered to be purchased in a bona fide offer pursuant to clause (1) above and (y) the principal amount of the Notes that were purchased pursuant to such offer. When the aggregate amount of Excess Proceeds with respect to the Notes exceeds $300.0 million, the Company shall make an offer to all Holders of the Notes and, if required by the terms of any other Pari Passu Lien Obligations, to the holder of such Pari Passu Lien Obligations (an “Asset Sale Offer”), to purchase the maximum aggregate principal amount of such Notes and the maximum aggregate principal amount (or accreted value, if less) of such Pari Passu Lien Obligations that is a minimum of $200,000 or an integral multiple of $1,000 thereof (in aggregate principal amount) that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof (or accreted value, if applicable) plus accrued and unpaid interest to the date fixed for the closing of such Asset Sale Offer, in accordance with the procedures set forth in the Indenture. The Company will commence an Asset Sale Offer with respect to Excess Proceeds within thirty Business Days after the date that Excess Proceeds exceed $300.0 million by mailing the notice required pursuant to the terms of the Indenture, with a copy to the Trustee and the Collateral Agent. The Company, in its sole discretion, may satisfy the foregoing obligations with respect to any Net Proceeds from an Asset Sale by making an Asset Sale Offer with respect to such Net Proceeds prior to the expiration of the relevant period provided above) or with respect to Excess Proceeds of $300.0 million or less.

To the extent that the aggregate principal amount of Notes and the aggregate principal amount (or accreted value, if applicable) of such other Pari Passu Lien Obligations tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds with respect to the Notes, the Company may use any remaining Excess Proceeds for general corporate purposes, subject to the other covenants contained in the Indenture and the Security Documents. If the aggregate principal amount of Notes and the aggregate principal amount (or accreted value, if applicable) of such other Pari Passu Lien Obligations surrendered in an Asset Sale Offer exceeds the amount of Excess Proceeds with respect to the Notes, the Notes shall be selected and the Company or the agent for such Pari Passu Lien Obligations will select such Pari Passu Lien Obligations to be purchased, on a pro rata basis based on the principal amount of the Notes and the aggregate principal amount (or accreted value, if applicable) of such other Pari Passu Lien Obligations tendered. Upon completion of any such Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.

Pending the final application of (a) Net Proceeds from an Asset Sale involving a disposition of Collateral pursuant to this covenant, the holder of such Net Proceeds may apply such Net Proceeds temporarily to reduce Indebtedness outstanding under a revolving credit facility that constitutes First-Priority Lien Obligations, or, deposit such Net Proceeds temporarily in a deposit account pursuant to which the Collateral Agent has a perfected Lien in favor of the Holders pursuant to the Security Documents, and (b) Net Proceeds from an Asset Sale not involving a disposition of Collateral pursuant to this covenant, the holder of such Net Proceeds may apply such Net Proceeds temporarily to reduce Indebtedness outstanding under a revolving credit facility, including under any Credit Facilities, or otherwise invest or apply such Net Proceeds from an Asset Sale not involving a disposition of Collateral in any manner not prohibited by the Indenture. If the recipient of the Net Proceeds is a Foreign Subsidiary, in lieu of the holder of the actual Net Proceeds depositing or applying such Net Proceeds in the manner described in the foregoing clause (a), the Company or any Restricted Subsidiary may deposit or apply an amount equal to such Net Proceeds in the manner described in the foregoing clause (a). The Collateral Agent or its designated representative may not have control of, or a perfected security interest in, Net Proceeds of any Collateral, which could have the effect of diminishing the value of, and ability to collect with respect to, that Collateral.

The Company will comply with the requirements of Section 14(e) of the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of the Indenture, the Company will comply with the applicable

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securities laws and regulations and shall not be deemed to have breached its obligations described in the Indenture by virtue thereof.

Except as described in clause (11) of the second paragraph under —Amendment, Supplement and Waiver, the provisions under the Indenture relative to the Issuers’ obligation to make an offer to repurchase the Notes as a result of an Asset Sale may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.

Selection and Notice

If the Issuers are redeeming or purchasing less than all of the Notes of a series at any time, the Notes to be redeemed or purchased will be selected as follows (a) if such Notes are listed on any national securities exchange, in compliance with the requirements, as specified by the Company, of the principal national securities exchange on which such Notes are listed or (b) if such Notes are not listed on any national securities exchange, on a pro rata basis to the extent practicable, or, if the pro rata basis is not practicable for any reason, by lot or by such other method as the Paying Agent shall deem appropriate and in accordance with the procedures of DTC.

Notices of purchase or redemption shall be mailed by first-class mail, postage prepaid, at least 30 but not more than 60 days before the purchase or redemption date to (w) each Holder of Notes to be redeemed at such Holder’s registered address, (x) to the Trustee, (y) to the Registrar to forward to each Holder of Notes to be redeemed at such Holder’s registered address, or (z) otherwise in accordance with the procedures of DTC, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction and discharge of the Indenture. If any Note is to be purchased or redeemed in part only, any notice of purchase or redemption that relates to such Note shall state the portion of the principal amount thereof that has been or is to be purchased or redeemed.

The Issuers will issue a new Note in a principal amount equal to the unredeemed portion of the original Note in the name of the Holder upon cancellation of the original Note. Notes called for redemption become due on the date fixed for redemption. On and after the redemption date, interest ceases to accrue on Notes or portions of them called for redemption.

Guarantees

Each Subsidiary that guarantees any of the Senior Credit Facilities also guarantees the Notes, subject to release as provided below. Each Guarantor’s Guarantee of the Notes will be a senior obligation of such Guarantor and will be secured by the Collateral as described below under —Security. The Notes will be structurally subordinated to Indebtedness and other liabilities of Subsidiaries of the Company that do not guarantee the Notes, including all of the Company’s subsidiaries that are not Domestic Subsidiaries.

The Guarantors, as primary obligors and not merely as sureties, will initially jointly and severally irrevocably and unconditionally guarantee, in each case, the performance and full and punctual payment when due, whether at maturity, by acceleration or otherwise, of all obligations of the Issuers under the Indenture and the Notes, whether for payment of principal of or interest on the Notes, expenses, indemnification or otherwise, on the terms set forth in the Indenture by executing the Indenture or a supplemental indenture.

Not all of the Company’s Subsidiaries will guarantee the Notes. In the event of a bankruptcy, liquidation or reorganization of any of these non-guarantor Subsidiaries, the non-guarantor Subsidiaries will pay the holders of their debt and their trade creditors before they will be able to distribute or contribute, as the case may be, any oftheir assets to a Guarantor or the Issuers. The non-guarantor Subsidiaries accounted for approximately $40.7 billion of our revenues, net, including intercompany transactions, and approximately $1.9 billion, of our Modified EBITDA, in each case, for the period ended December 31, 2013. SeeManagement’s Discussion and Analysis of Financial Condition and Results of Operations —Non-GAAP Financial Measures for descriptions of

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our Non-GAAP financial measures. Our non-guarantor Subsidiaries had approximately $13.6 billion in total assets, as of December 31, 2013, after giving effect to the Refinancing Transactions and the $1.9 billion special distribution paid by the Company to its members as part of Fiat North America LLC’s acquisition of the UAW Retiree Medical Benefits Trust’s equity interest in the Company. As of December 31, 2013, after giving effect to the Refinancing Transactions and special distribution as described above, our non-guarantor Subsidiaries had approximately $8.9 billion of total liabilities (including trade payables) to which the Notes would be structurally subordinated.

For a description of the Collateral, lien priority and intercreditor arrangement, see —Security below.

The obligations of each Guarantor under its Guarantee will be limited as necessary to prevent such Guarantee from constituting a fraudulent conveyance under applicable law. Any Guarantor that makes a payment under its Guarantee will be entitled upon payment in full of all guaranteed obligations under the Indenture to a contribution from each other Guarantor in an amount equal to such other Guarantor’s pro rata portion of such payment based on the respective net assets of all the Guarantors at the time of such payment (such net assets determined in accordance with GAAP).

If a Guarantee were rendered voidable, it could be subordinated by a court to all other indebtedness (including guarantees of the Senior Credit Facilities and other obligations and other contingent liabilities) of the Guarantor, and, depending on the amount of such indebtedness, a Guarantor’s liability on its Guarantee could be reduced to zero.

Pursuant to the Indenture, (A) a Guarantor may consolidate with, merge with or into, or transfer all or substantially all its assets to any other Person to the extent described below under —Certain Covenants in the Indenture —Merger, Consolidation or Sale of All or Substantially All Assets and (B) the Equity Interests of a Guarantor may be sold or otherwise disposed of to another Person to the extent described above under —Repurchase at the Option of Holders —Asset Sales;provided,however, that in the case of the consolidation, merger or transfer of all or substantially all the assets of such Guarantor, if such other Person is not the Company or a Guarantor, suchGuarantor’s obligations under its Guarantee must be expressly assumed by such other Person, except that such assumption will not be required in the case of:

(1) the sale or other disposition (including by way of consolidation or merger) of a Guarantor (including the sale or disposition of Equity Interests of a Guarantor) following which such Guarantor is no longer a Subsidiary; or

(2) the sale or disposition of all or substantially all the assets of a Guarantor;

in each case, other than to the Company or an Affiliate of the Company and as permitted by the Indenture and if in connection therewith the Company provides an Officers’ Certificate to the Trustee to the effect that the Company will comply with its obligations under the covenant described under —Repurchase at the Option of Holders —Asset Sales in respect of such disposition. Upon any sale or disposition described in clause (1) or (2) above, the obligor on the related Guarantee will be released from its obligations thereunder.

The Guarantee of a Guarantor also will be released automatically:

(1) upon the designation of such Guarantor as an Unrestricted Subsidiary to the extent permitted by the Indenture; or

(2) if the Issuers exercise their legal defeasance option or our covenant defeasance option as described under —Legal Defeasance and Covenant Defeasance or if our obligations under the Indenture are discharged in accordance with the terms of the Indenture.

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Security

Description of Collateral

The Notes and the Guarantees will, with certain exceptions, subject to prior Liens and subject to the limitations described below under —Limitations on Capital Stock Collateral, be secured by junior-priority Liens on the Collateral owned by the Issuers and each Guarantor and the 2019 Notes and the 2021 Notes will share in the benefit of such Liens based on the respective amounts of the Obligations thereunder. The Collateral consists of (i) 100% of the Capital Stock of the Co-Issuer and 100% of the Capital Stock of existing and future Domestic Subsidiaries of the Company or any Guarantor that are owned directly by the Company or any Guarantor (in each case, subject to the limitations described below under —Limitations on Capital Stock Collateral), (ii) 65% of the Capital Stock of all existing and future Foreign Subsidiaries of the Company or any Guarantor that are owned directly by the Company or any Guarantor (in each case, subject to the limitations described below under —Limitations on Capital Stock Collateral) and (iii) substantially all of the other property and assets that are held directly by the Issuers or any Guarantor, to the extent that such assets secure any First-Priority Lien Obligations and to the extent that a junior-priority security interest is able to be granted or perfected therein. The Collateral does not include any assets of any of Company’s Foreign Subsidiaries, or any capital stock of any of Company’s Foreign Subsidiaries, other than 65% of the Company’s or any Guarantor’s direct Foreign Subsidiaries.

The Collateral does not and will not comprise all or substantially all of the assets of the Company or the Guarantors. As described below there are a number of assets that will not constitute Collateral for the benefit of the Notes. SeeRisk Factors —Risks Related to Our Structure, the Notes and the Exchange Offers —There may not be sufficient collateral to satisfy our obligations under the Notes, and the collateral securing the Notes may be diluted under certain circumstances.

The security interests securing the Notes and the Guarantees will be junior in priority to any and all security interests at any time granted in the Collateral to secure the First-Priority Lien Obligations, and will also be subject to all other Permitted Liens, certain of which, such as Liens arising as a matter of law and purchase money security interests, will or may have priority over the security interests securing the Notes and the Guarantees. The First-Priority Lien Obligations include obligations of the Company and the Guarantors with respect to the Senior Credit Facilities, as well as certain hedging obligations and certain obligations in respect of cash management services. The persons holding such First-Priority Lien Obligations have rights and remedies with respect to the property subject to such Liens that, if exercised, could adversely affect the value of the Collateral or the ability of the Collateral Agent to realize or foreclose on the Collateral on behalf of holders of the Notes.

The Issuers and the Guarantors will be able to incur additional Indebtedness in the future that could share in the Collateral, including additional First-Priority Lien Obligations and Pari Passu Lien Obligations. The amount of such First-Priority Lien Obligations and Pari Passu Lien Obligations will be limited by the covenant disclosed under —Certain Covenants in the Indenture —Liens. Under certain circumstances, the amount of such additional First-Priority Lien Obligations and Pari Passu Lien Obligations could be significant.

Releases of Collateral

The Liens on the Collateral will be released with respect to the Notes and the Guarantees:

(i) in whole, if all other Liens on such property or assets securing First-Priority Lien Obligations and other Pari Passu Lien Obligations including all commitments and letters of credit thereunder are released;provided, however, that if, prior to the occurrence of the Fall-Away Date, the Issuers or any Restricted Subsidiary subsequently incurs Indebtedness secured by any Permitted Lien (other than (x) Liens Incurred under clause (9) of the definition of “Permitted Liens”; and (y) Purchase Money Liens) then the Company and its Restricted

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Subsidiaries will be required to as soon as practicable after the Incurrence of such Permitted Lien execute and deliver such security instruments and financing statements to vest in the Collateral Agent a perfected security interest (subject only to Permitted Liens) in the assets or property subject to such Permitted Lien, which in the case of any such subsequent First-Priority Lien Obligations that are secured by a senior priority Lien, the Liens on such property or assets securing the Notes will be junior in priority to the Liens on such property or assets securing such First-Priority Lien Obligations to the same extent provided by the Security Documents and on the terms and conditions of the security documents relating to such First-Priority Lien Obligations with the Lien held either by the First-Priority Collateral Agent or by the Collateral Agent or other representative designated by the Company to hold the Liens for the benefit of the Holders of the Notes and subject to an intercreditor agreement that provides the administrative agent or collateral agent substantially the same rights and powers as afforded under the Intercreditor Agreement;

(ii) in whole, upon payment in full of the principal of, accrued and unpaid interest, if any, and premium, if any, on, the Notes;

(iii) in whole, upon satisfaction and discharge of the Indenture as described under —Satisfaction and Discharge;

(iv) in whole, upon a legal defeasance or covenant defeasance as described under —Legal Defeasance andCovenant Defeasance;

(v) in whole, upon the occurrence of the Fall-Away Date as described under —Certain Covenants in the Indenture —Covenant Fall-Away;

(vi) in part, as to any property or asset constituting Collateral (A) that is sold or otherwise disposed of by the Company or any of the Guarantors in a transaction permitted by the documents governing the First-Priority Lien Obligations (whether or not an “event of default” under the documents governing the First-Priority Lien Obligations or the documents governing the Pari Passu Lien Obligations has occurred and is continuing) if all other Liens on that asset securing the First-Priority Lien Obligations (including all commitments thereunder) are released, (B) that is sold or otherwise disposed of or deemed disposed of in a transaction permitted by —Repurchase at the Option of Holders —Asset Sales, (C) that is owned by a Guarantor to the extent such Guarantor has been released from its Subsidiary Guarantee in accordance with the Indenture or (D) otherwise in accordance with, and as expressly provided for under, the Indenture; or

(vii) as described under —Amendments, Supplements and Waivers.

Upon any sale or disposition of Collateral in compliance with the Indenture and the Security Documents, the Liens in favor of the Collateral Agent on such Collateral and (subject to the provisions described under —Additional Collateral) all proceeds thereof shall automatically terminate and be released and the Collateral Agent will execute and deliver such documents and instruments as the Company and the Guarantors may prepare and request to evidence such termination and release (without recourse or warranty) without the consent of the Holders.

The Company will furnish to the Collateral Agent and the Trustee (if not the Collateral Agent), prior to each proposed release of Collateral (other than in connection with an automatic termination and release of a Lien) pursuant to the Security Documents and the Indenture, an Officers’ Certificate and Opinion of Counsel and such other documentation as is required by the Indenture.

Limitations on Capital Stock Collateral

The Capital Stock and securities of any Subsidiary of the Company will constitute Collateral only to the extent that such Capital Stock and securities can secure the Notes without Rule 3-16 of Regulation S-X under the Securities Act (or any other law, rule or regulation) requiring separate financial statements of such Subsidiary to

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be filed with the SEC. In the event that Rule 3-16 of Regulation S-X under the Securities Act requires or is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation that would require) the filing with the SEC of separate financial statements of any Subsidiary of the Company due to the fact that such Subsidiary’s Capital Stock and securities secure the Notes or any Guarantee, then the Capital Stock and securities of such Subsidiary shall automatically be deemed not to be part of the Collateral (but only to the extent necessary for such Subsidiary to not be subject to such requirement to provide separate financial statements) and such excluded portion of the Capital Stock and securities is referred to as the“Excluded Stock Collateral.” In such event, the Security Documents may be amended, modified or supplemented, without the consent of any Holder, to the extent necessary to release the security interests on the Excluded Stock Collateral. The Senior Credit Facilities and any other Credit Facilities that the Company and any of its Subsidiaries enter into in the future will not be subject to Rule 3-16 of Regulation S-X. Accordingly, on the date that Rule 3-16 of Regulation S-X becomes applicable to the Notes, the lenders under the Senior Credit Facilities and any other Credit Facilities that the Company and any of its Subsidiaries enter into in the future will have a security interest in more assets than the Collateral Agent for the Holders of Notes. In addition, there will not be any requirement that the holders of obligations secured by a senior orpari passu lien, including the lenders under the Senior Credit Facilities and any other Credit Facilities that the Company and any of its Subsidiaries enter into in the future, seek to realize on the value of assets not securing the Notes before they realize on the Collateral and therefore the Holders of Notes may recover less than holders of other debt with a senior orpari passu lien.

In the event that Rule 3-16 of Regulation S-X under the Securities Act is amended, modified or interpreted by the SEC to permit (or is replaced with another rule or regulation that would permit) any Subsidiary’s Excluded Stock Collateral to secure the Notes in excess of the amount then pledged without the filing with the SEC of separate financial statements of such Subsidiary, then the Capital Stock and securities of such Subsidiary shall automatically be deemed to be a part of the Collateral (but only to the extent possible without such Subsidiary becoming subject to any such filing requirement). In such event, the Security Documents may be amended or modified, without the consent of any Holder, to the extent necessary to subject to the Liens under the Security Documents such additional Capital Stock and securities.

In accordance with the limitations set forth in the two immediately preceding paragraphs, on the date thatRule 3-16 of Regulation S-X becomes applicable to the Notes, the Collateral will include shares of Capital Stock of the Subsidiaries only to the extent that the applicable value of such Capital Stock (on an entity-by-entity basis) is less than 20% of the aggregate principal amount of the then outstanding Notes. As of the issue date of the Notes, certain of the Guarantors will have Capital Stock valued at or in excess of 20% of the aggregate principal amount of the then outstanding Notes; accordingly, if Rule 3-16 of Regulation S-X under the Securities Act was applicable to the Notes on such date, each such pledge of such stock as Collateral would be deemed to be limited to stock with a value that is less than 20% of the aggregate principal amount of the then outstanding Notes pursuant to these provisions. In the event that Rule 3-16 of Regulation S-X becomes applicable to the Notes, we anticipate that the Capital Stock of multiple Subsidiaries of ours will be subject to such limitations. If, at any time after Rule 3-16 of Regulation S-X becomes applicable to the Notes, the applicable value of the Capital Stock of any Guarantor is equal to or exceeds 20% of the aggregate principal amount of the Notes then outstanding, the pledge of such Subsidiary’s Capital Stock shall automatically be deemed to be limited to stock with a value that is less than 20% of the aggregate principal amount of the then outstanding Notes. If, at any time after Rule 3-16 of Regulation S-X becomes applicable to the Notes, the applicable value of 100% of the Capital Stock of any pledged entity becomes less than 20% of the aggregate principal amount of the Notes then outstanding and the pledge of such Capital Stock has been deemed limited in accordance with this paragraph prior to such date, the pledge of such Capital Stock shall automatically be deemed to be 100% of its Capital Stock. Accordingly, the portion of the Capital Stock of the Subsidiary of the Company constituting Collateral may decrease or increase as described above. We conduct a substantial portion of our business through our Subsidiaries, many of which have Capital Stock with a value in excess of 20% of the aggregate principal amount of the Notes. Accordingly, on the date that Rule 3-16 of Regulation S-X becomes applicable to the Notes, the pledge of stock and securities with respect to each such Subsidiary will be limited in value to less than 20% of the aggregate principal amount of the Notes.

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SeeRisk factors —Risks Related to Our Structure, the Notes and the Exchange Offers —There may not be sufficient collateral to satisfy our obligations under the Notes, and the collateral securing the Notes may be diluted under certain circumstances.

Additional Collateral

From and after the Issue Date and prior to the Fall-Away Date, if the Issuers or any Guarantor creates any additional security interest upon any property or asset to secure any Indebtedness pursuant to clause (6), (7), (8), (9), (11)(B) or (12)(B) of the definition of “Permitted Liens” or pursuant to clause (21) of the definition of “Permitted Liens” to the extent it relates to the refinancing of Indebtedness secured pursuant to clause (6), (7), (8), (9), (11)(B) or (12)(B) of the definition of “Permitted Liens” (other than Liens on any DOE Assets or DOE Replacement Assets to secure the Senior Credit Facilities;provided, however, that such Liens to secure the Senior Credit Facilities are junior in priority to the Lien on such assets securing any Permitted DOE Facility or any Indebtedness secured pursuant to clause (12)(A) of the definition of “Permitted Liens”) and at such time such assets or property are not pledged to secure the Notes, it shall as soon as practicable after the acquisition or pledge thereof, as applicable, execute and deliver such security instruments, financing statements and such certificates and opinions of counsel to vest in the Collateral Agent a perfected security interest (subject only to Permitted Liens) in such assets or property and to have such assets or property added to the Collateral, and thereupon all provisions of the Indenture relating to the Collateral shall be deemed to relate to such assets or property to the same extent and with the same force and effect. If granting a security interest in such assets or property requires the consent of a third party, the Issuers or the applicable Guarantor will use commercially reasonable efforts to obtain such consent with respect to the junior-priority security interest for the benefit of the Collateral Agent on behalf of the Holders. If such third party does not consent to the granting of the junior-priority security interest after the use of such commercially reasonable efforts, the applicable entity will not be required to provide such security interest. It is possible that a third party might consent to the granting of first-priority security interests for the benefit of the First-Priority Lien Obligations but might not consent to the granting of junior-priority security interests for the benefit of the Notes and the Guarantees. SeeRisk Factors —Risks Related to Our Structure, the Notes and the Exchange Offers —Rights of holders of the Notes in the collateral may be adversely affected by the failure to perfect security interests in certain collateral.

Security Documents and Intercreditor Agreement

The Issuers, the Guarantors and the Collateral Agent have entered into, and may in the future enter into, one or more Security Documents defining the terms of the security interests that secure the Notes and the Guarantees. These security interests will secure the payment and performance when due of all of the Obligations of the Issuers and the Guarantors under the Notes, the Indenture, the Guarantees and the Security Documents, as provided in the Security Documents.

The Issuers, the Guarantors, the Collateral Agent (in such capacity, together with its successors and assigns, the“Junior Priority Representative”), and the administrative agents and collateral agents under the Senior Credit Facilities and the Term Loan Credit Facility (in such capacity, together with its successors and assigns, the“Senior Priority Representatives”) have entered into the Intercreditor Agreement. Pursuant to the terms of the Intercreditor Agreement, at any time prior to the Senior Priority Obligations Payment Date, the Senior Priority Representatives will determine the time and method by which the security interests in the Common Collateral will be enforced. The Junior Priority Representative will not be permitted to enforce the security interests even if an Event of Default under the Indenture has occurred and the Notes have been accelerated except (a) in any Insolvency Proceeding, as necessary to file a proof of claim or statement of interest with respect to the Liens in favor of the Notes or (b) as necessary to take any action (not adverse to the Liens on the Common Collateral securing the Senior Priority Obligations, or the rights of either the Senior Priority Representatives or the other Senior Priority Secured Parties to exercise remedies in respect thereof) in order to create, prove, perfect, preserve or protect (but not enforce) its rights in, and the perfection and priority of its Liens on the Common Collateral.

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All proceeds of Common Collateral (including any interest earned thereon) resulting from the sale, collection or other disposition of Common Collateral resulting from any enforcement action or that occurs after any Event of Default (as defined in the documents governing the Senior Priority Obligations and the security interests with respect thereto, including the credit agreement for the Senior Credit Facilities (the “Senior Priority Documents”)), whether or not pursuant to an Insolvency Proceeding or during the pendency of any Insolvency Proceeding, shall be distributed first to the Senior Priority Representatives for application to the Senior Priority Obligations in accordance with the terms of the Senior Priority Documents, until the Senior Priority Obligations have been paid in full and the Senior Priority Obligations Payment Date has occurred. Thereafter, the Junior Priority Representative in accordance with the provisions of the Indenture and the Security Documents will distribute all cash proceeds (after payment of the costs of enforcement and collateral administration and any other amounts owed to the Junior Priority Representative) of the Collateral received by it under the Security Documents for the ratable benefit of the holders of the Notes and the other Junior Priority Secured Parties. The proceeds from the sale of the Collateral remaining after the satisfaction of all Senior Priority Obligations may not be sufficient to satisfy the obligations owed to the holders of the Notes. By its nature some or all of the Collateral is and will be illiquid and may have no readily ascertainable market value. Accordingly, the Collateral may not be able to be sold in a short period of time, if salable.

Until the occurrence of the Senior Priority Obligations Payment Date, any Common Collateral, including any Common Collateral constituting proceeds, that may be received by the Junior Priority Representative or any secured party under any Junior Priority Security Document in violation of the Intercreditor Agreement shall be segregated and held in trust and promptly paid over to the Senior Priority Representatives, for the benefit of the Senior Priority Secured Parties.

Upon (i) any sale or other disposition of Common Collateral permitted pursuant to the terms of the Senior Priority Documents that results in the release of the Lien in favor of the Senior Priority Obligations on any Common Collateral (including any sale or other disposition pursuant to any enforcement action) or (ii) any other release of Common Collateral from the Lien created by the security documents with respect to the Senior Priority Obligations (the “Senior Priority Security Documents”) that is permitted pursuant to the terms of the Senior Priority Documents, the Liens with respect to the Junior Priority Obligations on such Common Collateral (excluding any portion of the proceeds of such Common Collateral remaining after the Senior Priority Obligations Payment Date occurs) shall be automatically and unconditionally released with no further consent or action of any Person.

Pursuant to the Intercreditor Agreement, the Junior Priority Representative has agreed for itself and the other Junior Priority Secured Parties, including the Secured Parties, that until the Senior Priority Obligations Payment Date has occurred:

(a) they will not take or cause to be taken any action, the purpose or effect of which is to make any Lien in respect of any Junior Priority Obligation pari passu with or senior to, or to give any Secured Party any preference or priority relative to, the Liens with respect to the Senior Priority Obligations or the Senior Priority Secured Parties with respect to any of the Common Collateral;

(b) they will not contest, oppose, object to, interfere with, hinder or delay, in any manner, whether by judicial proceedings (including the filing of an Insolvency Proceeding) or otherwise, any foreclosure, sale, lease, exchange, transfer or other disposition of the Common Collateral or any other collateral which secures the Senior Priority Obligations by any Senior Priority Secured Party or any other enforcement action taken (or any forbearance from taking any enforcement action) by or on behalf of any Senior Priority Secured Party;

(c) they have no right to (i) direct either the Senior Priority Representatives or any other Senior Priority Secured Party to exercise any right, remedy or power with respect to the Common Collateral or pursuant to the Senior Priority Security Documents or (ii) consent or object to the exercise by the Senior Priority

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Representatives or any other Senior Priority Secured Party of any right, remedy or power with respect to the Common Collateral or pursuant to the Senior Priority Security Documents or to the timing or manner in which any such right is exercised or not exercised (or, to the extent they may have any such right described in this clause (c), whether as a junior lien creditor or otherwise, they will waive such right);

(d) they will not institute any suit or other proceeding or assert in any suit, Insolvency Proceeding or other proceeding any claim against any Senior Priority Secured Party seeking damages from or other relief by way of specific performance, instructions or otherwise, with respect to, and no Senior Priority Secured Party shall be liable for, any action taken or omitted to be taken by any Senior Priority Secured Party with respect to the Common Collateral or pursuant to the Senior Priority Documents;

(e) they will not make any judicial or nonjudicial claim or demand or commence any judicial or non-judicial proceedings against any Credit Party or any of its Subsidiaries or Affiliates under or with respect to any Junior Priority Security Document seeking payment or damages from or other relief by way of specific performance, instructions or otherwise under or with respect to any Junior Priority Security Document or exercise any right, remedy or power under or with respect to, or otherwise take any action to enforce, any Junior Priority Security Document;

(f) they will not commence judicial or nonjudicial foreclosure proceedings with respect to, seek to have a trustee, receiver, liquidator or similar official appointed for or over, or attempt any action to take possession of any Common Collateral, or exercise any right, remedy or power with respect to, or otherwise take any action to enforce their interest in or realize upon, the Common Collateral or pursuant to the Junior Priority Security Documents;

(g) they will not seek, and will waive any right, to have the Common Collateral or any part thereof marshaled upon any foreclosure or other disposition of the Common Collateral and will waive, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the Common Collateral or any other similar rights a junior secured creditor may have under applicable law; and

(h) they will not object to the forbearance by the Senior Priority Secured Parties from bringing or pursuing any foreclosure proceeding or action or any other exercise of any rights or remedies relating to the Common Collateral or any other collateral securing the Senior Priority Obligations.

In addition, the Intercreditor Agreement provides that, prior to the Senior Priority Obligations Payment Date, (1) the holders of Senior Priority Obligations and the Senior Priority Representatives shall have the exclusive right to make determinations regarding the release of Common Collateral without the consent of the holders of the Notes and (2) in the event the Senior Priority Representatives enter into any amendment, waiver or consent in respect of any of the Senior Priority Security Documents for the purpose of adding to, or deleting from, or waiving or consenting to any departures from any provisions of, any Senior Priority Security Document or changing in any manner the rights of any parties thereunder, then such amendment, waiver or consent shall apply automatically to any comparable provision of the Comparable Junior Priority Security Document without the consent of or action by any secured party under any Junior Priority Security Document.

In addition, if the Issuers or any Guarantor is subject to any Insolvency Proceeding, the Junior Priority Representative and the other holders of Pari Passu Lien Obligations, including the Secured Parties, have agreed that:

(1) if the Senior Priority Representatives shall desire to permit the use of cash collateral or to permit the Issuers or any Guarantor to obtain financing under Section 363 or Section 364 of Title 11 of the Bankruptcy Code or any similar provision in any Bankruptcy Law (“DIP Financing”), then the Junior

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Priority Representative and the other Junior Priority Secured Parties agree not to object to such use of cash collateral or DIP Financing and will not request or accept adequate protection or any other relief in connection therewith and, to the extent the Liens securing the Senior Priority Obligations are subordinated or pari passu with such DIP Financing, will subordinate its Liens in the Collateral to such DIP Financing (and all Obligations relating thereto) on the same basis as they are subordinated to the Senior Priority Obligations;

(2) they will not seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of the Common Collateral, without the prior written consent of the Senior Priority Representatives and the required lenders under the Senior Priority Agreements;

(3) they will not object to, and will not otherwise contest any order relating to a sale of assets of the Issuer or any Guarantor for which the Senior Priority Representatives have consented that provides, to the extent the sale is to be free and clear of Liens, that the Liens securing the Senior Priority Obligations and the Notes will attach to the proceeds of the sale on the same basis of priority as the existing Liens in accordance with the Intercreditor Agreement;

(4) they will not object to, contest or support (or support any other Person objecting to or contesting to) (a) any request by the Senior Priority Representatives or the holders of Senior Priority Obligations for adequate protection or (b) any objection by the Senior Priority Representatives or the holders of Senior Priority Obligations to any motion, relief, action or proceeding based on the Senior Priority Representatives’ or the holders of Senior Priority Obligations’ claiming a lack of adequate protection (c) or the payment of interest, fees, expenses, costs, charges or other amounts to the Senior Priority Representatives under Section 506(b) or 506(c) of the Bankruptcy Code or otherwise. Notwithstanding the foregoing, in any Insolvency Proceeding, (i) if the holders of Senior Priority Obligations (or any subset thereof) are granted adequate protection in the form of additional collateral in connection with any DIP Financing or use of cash collateral, then the Junior Priority Representative (A) may seek or request adequate protection in the form of a replacement Lien on such additional collateral, which Lien is subordinated to the Liens securing (x) the Senior Priority Obligations and (y) such DIP Financing (and all Obligations relating thereto) on the same basis as the other Liens securing the Notes are so subordinated to the Liens securing Senior Priority Obligations under the Intercreditor Agreement, and (ii) in the event the Junior Priority Representative seeks or requests adequate protection and such adequate protection is granted in the form of additional collateral, then the Junior Priority Representative and the other Junior Priority Secured Parties agree that the holders of the Senior Priority Obligations shall also be granted a senior Lien on such additional collateral as security for the applicable Senior Priority Obligations and any such DIP Financing and that any Lien on such additional collateral securing the Notes shall be subordinated to (x) the Liens on such collateral securing the Senior Priority Obligations and (y) any such DIP Financing (and all Obligations relating thereto) and any other Liens granted to the holders of Senior Priority Obligations as adequate protection on the same basis as the other Liens securing the Notes are so subordinated to such Liens securing Senior Priority Obligations under the Intercreditor Agreement;

(5) no Junior Priority Secured Party shall support or vote in favor of any plan of reorganization unless such plan (a) pays off, in cash in full, all Senior Priority Obligations or (b) is accepted by the class of holders of Senior Priority Obligations voting thereon; and

(6) until the Senior Priority Obligations Payment Date has occurred, the Junior Priority Representative, on behalf of itself and each other Junior Priority Secured Party, agrees that it (i) will not assert or enforce any claim under Section 506(c) of the Bankruptcy Code senior to or on a parity with the Liens securing the Senior Priority Obligations for costs or expenses of preserving or disposing of any Common Collateral, and (ii) waives any claim it may have arising out of the election by any holder of Senior Priority Obligations of the application of Section 1111(b)(2) of the Bankruptcy Code.

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Subject to the terms of the Security Documents, the Issuers and the Guarantors have the right to remain in possession and retain exclusive control of the Collateral securing the Notes and the related Guarantee, to freely operate the Collateral and to collect, invest and dispose of any income therefrom.

Certain Definitions

“Additional Junior Priority Agreement” means any agreement designated as such in writing (including by addendum to the Intercreditor Agreement) by the Senior Priority Representatives and the Junior Priority Representative in accordance with the terms of the Senior Priority Agreement and Junior Priority Agreement, respectively.

“Additional Senior Priority Agreement” means any agreement designated as such in writing (including by addendum to the Intercreditor Agreement) by the Senior Priority Representatives and the Junior Priority Representative in accordance with the terms of the Senior Priority Agreement and Junior Priority Agreement, respectively.

“Bankruptcy Code” means the United States Bankruptcy Code (11 U.S.C. §101 et seq.), as amended from time to time, or any successor statute.

“Bankruptcy Law” means each of the Bankruptcy Code and any other federal, state or foreign bankruptcy, insolvency, reorganization, receivership or similar law.

“Common Collateral” means all assets that are both collateral for the Junior Priority Obligations and collateral for the Senior Priority Obligations.

“Comparable Junior Priority Security Document” means, in relation to any Common Collateral subject to any Senior Priority Security Document, that Junior Priority Security Document that creates a security interest in the same Common Collateral, granted by the same Credit Party, as applicable.

“Credit Party” means (a) the Company and (b) each Subsidiary of the Company and any other Person in which the Company or any of its subsidiaries holds an ownership interest, in each case that is, at any time of determination, a party to any Senior Priority Security Document or Junior Priority Security Document.

“DOE Pari Passu Amount” means, at any time, 50% of the principal amount advanced under any Permitted DOE Facility minus the sum of (a) any principal amount repaid or discharged under such Permitted DOE Facility through the exercise of remedies in respect of any assets constituting collateral for such Permitted DOE Facility, but not constituting DOE Assets, and (b) 50% of the aggregate principal amount otherwise repaid, prepaid or discharged under such Permitted DOE Facility;provided, however, that the DOE Pari Passu Amount shall not at any time exceed $1.75 billion.

“Insolvency Proceeding” means any proceeding in respect of bankruptcy, insolvency, winding up, receivership, dissolution or assignment for the benefit of creditors, in each case whether under the Bankruptcy Code or any other Bankruptcy Law.

“Junior Priority Agreement” means, collectively, (a) the Indenture, (b) any Additional Junior Priority Agreement and (c) any other credit agreement, loan agreement, note agreement, promissory note, indenture, or other agreement or instrument evidencing or governing the terms of any indebtedness or other financial accommodation that has been incurred to extend, replace, refinance or refund in whole or in part the indebtedness and other obligations outstanding under the Indenture, any Additional Junior Priority Agreement or any other agreement or instrument referred to in this clause (c).

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“Junior Priority Obligations” means the due and punctual payment of (a) all principal of and interest (including any post-petition interest) and premium (if any) on all indebtedness under the Junior Priority Agreement, and (b) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including post-petition interest), of the Credit Parties or any of their Subsidiaries to the Junior Priority Secured Parties under the documents governing the Junior Priority Obligations, and other amounts payable from time to time pursuant to the documents governing the Junior Priority Obligations, in each case whether or not allowed or allowable in an Insolvency Proceeding. To the extent that obligations under any Permitted DOE Facility are secured by liens that are junior in lien priority to the liens securing the Senior Credit Facilities and pari passu in Lien priority to the Liens securing the Notes, the obligations under such Permitted DOE Facility shall constitute Junior Priority Obligations for purposes of the Intercreditor Agreement.

“Junior Priority Secured Party” means the Junior Priority Representative, each creditor under any Junior Priority Agreement and any other holders of the Junior Priority Obligations.

“Junior Priority Security Documents” means the Security Documents and any documents that are designated under the Junior Priority Agreement as “Junior Priority Security Documents” for purposes of the Intercreditor Agreement.

“Senior Priority Agreement” means, collectively, (a) the credit agreement with respect to the Senior Credit Facilities, (b) the Term Loan Credit Agreement, (c) any Additional Senior Priority Agreement and (d) any other credit agreement, loan agreement, note agreement, promissory note, indenture or other agreement or instrument evidencing or governing the terms of any indebtedness or other financial accommodation that has been incurred to extend, replace, refinance or refund in whole or in part the commitments and/or indebtedness and other obligations outstanding under the credit agreement with respect to the Senior Credit Facilities, the Term Loan Credit Agreement, any Additional Senior Priority Agreement or any other agreement or instrument referred to in this definition unless such agreement or instrument expressly provides that it is not intended to be and is not a Senior Priority Agreement under the Intercreditor Agreement.

“Senior Priority Obligations” means (a) all obligations of every nature of each Credit Party under the Senior Priority Documents, whether for principal, interest (including post-petition interest), reimbursement of amounts drawn under letters of credit, fees, expenses, indemnification or otherwise, (b) certain swap and designated cash management obligations and (c) to the extent constituting “Secured Obligations” under the Senior Priority Security Documents, the DOE Pari Passu Amount.

“Senior Priority Obligations Payment Date” means the first date on which (a) the Senior Priority Obligations (including any obligations replacing, renewing or refinancing any previously existing Senior Priority Obligations, but other than the certain swap obligations and cash management obligations and those that constitute Unasserted Contingent Obligations) have been indefeasibly paid in cash in full (or cash collateralized or defeased in accordance with the terms of the Senior Priority Documents), (b) all commitments to extend credit under the Senior Priority Documents (including any documents replacing, renewing or refinancing any previously existing Senior Priority Documents) have been terminated or expired and no letter of credit is outstanding and (c) the Senior Priority Representatives have delivered a written notice to the Junior Priority Representative stating that the events described in clauses (a) and (b) have occurred, such notice not to be unreasonably withheld.

“Senior Priority Secured Party” means (a) each agent under any Senior Priority Agreement and (b) each creditor under any Senior Priority Agreement and includes, without limitation, all former agents and creditors under any Senior Priority Agreement to the extent that any Senior Priority Obligations owing to such Persons were incurred while such Persons were agents or creditors under any Senior Priority Agreement and such Senior Priority Obligations have not been paid or satisfied in full.

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“Unasserted Contingent Obligations” means, at any time, Senior Priority Obligations for taxes, costs, indemnifications, reimbursements, damages and other liabilities (excluding (a) the principal of, and interest and premium (if any) on, and fees and expenses relating to, any Senior Priority Obligation and (b) contingent reimbursement obligations in respect of amounts that may be drawn under outstanding letters of credit or similar instruments) in respect of which no assertion of liability (whether oral or written) and no claim or demand for payment (whether oral or written) has been made (and, in the case of Senior Priority Obligations for indemnification, no notice for indemnification has been issued by the indemnitee) at such time.

Certain Limitations on the Collateral

No appraisals of any of the Collateral have been prepared by or on behalf of the Issuers or any Guarantor in connection with the issuance and sale of the Notes. The value of the Collateral in the event of liquidation will depend on many factors. Proceeds from the sale of Collateral will be required to be applied to repay First-Priority Lien Obligations before any funds will be available to satisfy claims with respect to the Notes. Consequently, liquidating the Collateral may not produce proceeds in an amount sufficient to pay any amounts due on the Notes. SeeRisk Factors —Risks Related to Our Structure, the Notes and the Exchange Offers —There may not be sufficient collateral to satisfy our obligations under the Notes, and the collateral securing the Notes may be diluted under certain circumstancesandRisk Factors —Risks Related to Our Structure, the Notes andthe Exchange Offers —Holders of the Notes will not control decisions regarding collateral.

The value of the Collateral is subject to fluctuations based on a number of factors, including, among others, prevailing interest rates, the ability to sell the Collateral in an orderly sale, general economic conditions, the availability of buyers and similar factors. The amount to be received upon a sale of the Collateral will be dependent on numerous factors, including the actual fair market value of the Collateral at such time and the timing and the manner of the sale. By its nature, some of the Collateral may be illiquid and may have no readily ascertainable market value. In the event of a foreclosure, liquidation, bankruptcy or similar proceeding, we cannot assure you that the proceeds from any sale or liquidation of the Collateral that remain after any required repayment of First-Priority Lien Obligations will be sufficient to pay the Issuers’ and the Guarantors’ Obligations under the Notes. Any claim for the difference between the amount, if any, realized by Holders from the sale of Collateral securing the Notes and the Obligations under the Notes will rank equally in right of payment with all of the Issuers’ and the Guarantors’ other unsecured senior debt and other unsubordinated obligations, including trade payables. To the extent that third parties establish Liens on the Collateral, such third parties could have rights and remedies with respect to the assets subject to such Liens that, if exercised, could adversely affect the value of the Collateral or the ability of the Collateral Agent or the Holders to realize or foreclose on the Collateral. The Issuers may also issue additional First-Priority Lien Obligations and Pari Passu Lien Obligations which would be secured by the Collateral, the effect of which would be to increase the amount of Indebtedness secured on a senior basis or equally and ratably, as the case may be, by the Collateral. The ability of the Holders to realize on the Collateral may also be subject to certain bankruptcy law limitations in the event of a bankruptcy.

Further Assurances

The Security Documents and the Indenture provide that the Issuers and the Guarantors shall, at their sole expense, do all acts that may be reasonably necessary to confirm that the Collateral Agent holds, for the benefit of the Holders and the Trustee, duly created, enforceable and perfected junior-priority Liens in the Collateral, subject only to Permitted Liens. As necessary, or upon request of the Collateral Agent, the Issuers and the Guarantors shall, at their sole expense, execute, acknowledge and deliver such documents and instruments and take such other actions as may be necessary to assure, perfect, transfer and confirm the rights conveyed by the Security Documents, to the extent permitted by applicable law. Notwithstanding anything to the contrary, however, the Collateral Agent shall have no obligation to so request and shall have no liability to the Holders of the Notes in connection with any such request or its failure to make any such request.

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Ranking

The indebtedness evidenced by the Notes and the Guarantees will be senior Indebtedness of the Issuers or the applicable Guarantor, as the case may be, will rank pari passu in right of payment with all existing and future senior Indebtedness of the Issuers and the Guarantors, as the case may be, and will have the benefit of the junior-priority security interest in the Collateral as described under —Security and will be senior in right of payment to all existing and future Subordinated Indebtedness of the Issuers and the Guarantors, as the case may be. Pursuant to the Security Documents and the Intercreditor Agreement, the security interests securing the Notes and the Guarantees are junior in priority (subject to Permitted Liens, including exceptions described under —Security) to all security interests at any time granted to secure First-Priority Lien Obligations, including the Senior Credit Facilities.

At December 31, 2013, as adjusted to give effect to the Refinancing Transactions,

(1) the Issuers and the Guarantors had approximately $11.0 billion of Secured Indebtedness outstanding, of which approximately $4.8 billion constitutes First-Priority Lien Obligations under the Senior Credit Facilities, in each case, excluding $1.3 billion of unused commitments under the revolving credit facility in the Senior Credit Facilities;

(2) the Issuers and the Guarantors had approximately $0.5 billion of unsecured Indebtedness outstanding; and

(3) the non-Guarantor Subsidiaries had approximately $1.5 billion of Indebtedness outstanding.

Subsequent to the issuances of and subject to the limitations in the Senior Credit Facilities, the Term Loan Credit Facility and the Secured Senior Notes Indenture, we have the option to increase the amount of the Revolving Facility in an aggregate principal amount not to exceed $700 million, subject to certain conditions.

The Indenture does not limit the incurrence of unsecured Indebtedness by the Company and its Subsidiaries. Although the Indenture limits the incurrence of Secured Indebtedness by the Company and its Restricted Subsidiaries, such limitations are subject to a number of significant qualifications and exceptions. Under certain circumstances, the Company and its Subsidiaries may be able to incur substantial amounts of Secured Indebtedness with senior lien priority to the Notes or secured by assets that do not secure the Notes. See —Certain Covenants in the Indenture —Liens.

A substantial portion of the operations of the Company are conducted through its Subsidiaries, some of which will not Guarantee the Notes. The Company’s Foreign Subsidiaries and certain Domestic Subsidiaries will not Guarantee the Notes, and, as described above under —Guarantees, Guarantees may be released under certain circumstances. In addition, future Subsidiaries may not be required to Guarantee the Notes. Unless a Subsidiary is a Guarantor, claims of creditors of such Subsidiary, including trade creditors, and claims of preferred stockholders (if any) of such Subsidiary generally will have priority with respect to the assets and earnings of such Subsidiary over the claims of creditors of the Issuers, including Holders. The Notes, therefore, will be effectively subordinated to claims of creditors (including trade creditors) and preferred stockholders (if any) of Subsidiaries of the Company that are not Guarantors. Our non-guarantor Subsidiaries accounted for approximately $40.7 billion of our revenues, net, including intercompany transactions, and approximately $1.9 billion of our Modified EBITDA, in each case, for the period ended December 31, 2013. Our non-guarantor Subsidiaries had approximately $13.6 billion in total assets, as of December 31 2013, after giving effect to the Refinancing Transactions and the $1.9 billion special distribution paid by the Company to its members as part of Fiat North America LLC’s acquisition of the UAW Retiree Medical Benefits Trust’s equity interest in the Company. As of December 31, 2013, after giving effect to the Refinancing Transactions and the special distribution as described above, our non-guarantor Subsidiaries had approximately $8.9 billion of total liabilities (including trade payables) to which the Notes would be structurally subordinated.

SeeRisk Factors —Risks Related to Our Structure, the Notes and the Exchange Offers.

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Paying Agent and Registrar for the Notes

The Issuers will maintain one or more Paying Agents for the Notes. The initial Paying Agent for the Notes will be Citibank, N.A.

The Issuers will also maintain a registrar in respect of the Notes, initially Citibank, N.A. If the Issuers fail to appoint a registrar, the Paying Agent will act as such. The registrar for the Notes will maintain a register reflecting ownership of the Notes outstanding from time to time and will make payments on and facilitate transfer of the Notes on behalf of the Issuers.

The Issuers may change the Paying Agents or the registrars without prior notice to the Holders. The Issuers, any Restricted Subsidiary or any Subsidiaries of a Restricted Subsidiary may act as a Paying Agent or Registrar.

Transfer and Exchange

A Holder may transfer or exchange Notes in accordance with the Indenture. Any registrar or the Paying Agent may require a Holder to furnish appropriate endorsements and transfer documents in connection with a transfer of Notes. Holders will be required to pay all taxes due on transfer. The Issuers are not required to transfer or exchange any Note selected for redemption. Also, the Issuers will not be required to transfer or exchange any Note for a period of 15 days before the mailing of a notice of redemption of Notes. The Notes will be issued in registered form and the registered holder of a Note will be treated as the owner of such Note for all purposes.

Certain Covenants in the Indenture

Set forth below are summaries of the principal covenants that are contained in the Indenture.

Limitation on Restricted Payments

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly:

(1) declare or pay any dividend or make any distribution or any payment having the effect thereof on account of the Company’s or any Restricted Subsidiary’s Equity Interests (in such Person’s capacity as holder of such Equity Interests), including any dividend or distribution payable in connection with any merger, amalgamation or consolidation other than:

(a) dividends or distributions payable solely in Equity Interests (other than Disqualified Stock) of the Company; or

(b) dividends or distributions by a Restricted Subsidiary so long as, in the case of any dividend or distribution payable on or in respect of any class or series of securities issued by a Restricted Subsidiary, the Company or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution in accordance with its Equity Interests in such class or series of securities;

(2) purchase, redeem, defease or otherwise acquire or retire for value any Equity Interests of the Company, including in connection with any merger, amalgamation or consolidation;

(3) make any principal payment on, or redeem, repurchase, defease or otherwise acquire or retire for value in each case, prior to any scheduled repayment, sinking fund payment, amortization payment, or maturity, any Subordinated Indebtedness other than:

(a) Indebtedness of the Company owed to a Guarantor or a Guarantor owed to the Company or another Guarantor; or

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(b) the payment of principal on or the purchase, redemption, defeasance, repurchase or other acquisition or retirement of Subordinated Indebtedness of the Company or any Restricted Subsidiary in anticipation of satisfying a sinking fund obligation, amortization payment, principal installment or Scheduled Maturity, in each case due within one year of the date of such payment of principal or such purchase, redemption, defeasance, repurchase or acquisition; or

(4) make any Investment after the Issue Date that is the designation of any Subsidiary as an Unrestricted Subsidiary;

(all such payments and other actions set forth in clauses (1) through (4) above being collectively referred to as “Restricted Payments”), unless, at the time of such Restricted Payment:

(1) no Default shall have occurred and be continuing or would occur as a consequence thereof;

(2) immediately after giving effect to such transaction the Fixed Charge Coverage Ratio on a consolidated basis for the Company and its Restricted Subsidiaries’ most recently ended four fiscal quarters for which internal financial statements are available immediately preceding the date of such transaction would have been at least 2.00 to 1.00 determined on a pro forma basis, as if the transaction had occurred at the beginning of the most recently ended four fiscal quarters for which internal financial statements are available; and

(3) the aggregate amount of such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the Issue Date (including Restricted Payments permitted by clauses (1), (2) (with respect to the payment of dividends on Refunding Capital Stock (as defined below) pursuant to clause (c) thereof only) and (7) of the next succeeding paragraph, but excluding all other Restricted Payments permitted by the next succeeding paragraph), is less than the sum of (without duplication):

(a) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) beginning on the first day of the fiscal quarter commencing after December 31, 2011 to the end of the Company’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment, or, in the case such Consolidated Net Income for such period is a deficit, minus 100% of such deficit; plus

(b) 100% of the aggregate net proceeds (including Cash Equivalents and the fair value (as determined in good faith by the Company) of assets or other property) received by the Company or a Restricted Subsidiary since immediately after the Issue Date from the issue or sale of:

(i) Equity Interests of the Company, including Treasury Capital Stock (as defined below), but excluding cash proceeds and the fair market value of marketable securities or other property received from the sale of (x) Equity Interests to members of management, directors or consultants of the Company and its Restricted Subsidiaries, after the Issue Date to the extent such amounts have been applied to Restricted Payments made in accordance with clause (4) of the next succeeding paragraph; and (y) Designated Preferred Stock; and

(ii) debt of the Company or any Restricted Subsidiary that has been converted into or exchanged for such Equity Interests of the Company;

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provided, however, that this clause (b) shall not include the proceeds from (V) Equity Interests issued or sold by the Company as part of the Transactions, (W) Refunding Capital Stock (as defined below), (X) Equity Interests or convertible debt securities sold to the Company or a Restricted Subsidiary, as the case may be, (Y) Disqualified Stock or debt securities that have been converted into Disqualified Stock or (Z) Excluded Contributions; plus

(c) 100% of the aggregate amount of net proceeds (including Cash Equivalents and the fair value (as determined in good faith by the Company) of assets or other property) contributed to the capital of the Company after the Issue Date;provided, however, that this clause (c) shall not include proceeds contributed to the Company as part of the Transactions; plus

(d) 100% of the aggregate amount of proceeds (including Cash Equivalents and the fair value (as determined in good faith by the Company) of other property) received by the Company or a Restricted Subsidiary after the Issue Date from the sale or other disposition (other than to the Company, a Restricted Subsidiary or an Affiliate of the Company) of the stock of an Unrestricted Subsidiary or a dividend or distribution from an Unrestricted Subsidiary after the Issue Date; plus

(e) in the event that the Company designates an Unrestricted Subsidiary as a Restricted Subsidiary after the Issue Date, the fair value of the Company’s Investment in such Unrestricted Subsidiary (as determined in good faith by the Company) at the time such Unrestricted Subsidiary is designated as a Restricted Subsidiary.

The foregoing provisions will not prohibit:

(1) the payment of any dividend within 60 days after the date of declaration thereof, if at the date of declaration such payment would have complied with the provisions of the Indenture;

(2) (a) the purchase, redemption, defeasance, repurchase, retirement or other acquisition for value of any Equity Interests (upon such purchase, redemption, defeasance, repurchase, retirement or other acquisition “Treasury Capital Stock”) or Subordinated Indebtedness of the Company or any Restricted Subsidiary made by exchange for, or out of the proceeds of the substantially concurrent sale or issuance (other than any sale or issuance to the Company or any of its Restricted Subsidiaries) of, Equity Interests (other than Disqualified Stock) of the Company to the extent of the cash proceeds actually contributed to the capital of the Company (“Refunding Capital Stock”), (b) the declaration and payment of dividends on the Treasury Capital Stock out of the proceeds of the substantially concurrent sale (other than any sale to the Company or any of its Restricted Subsidiaries) of the Refunding Capital Stock, and (c) if immediately prior to the retirement of Treasury Capital Stock, the declaration and payment of dividends thereon were permitted under clause (5) of this paragraph, the declaration and payment of dividends on the Refunding Capital Stock (other than Refunding Capital Stock the proceeds of which were used to purchase, redeem, defease, repurchase, retire or otherwise acquire any Equity Interests of any direct or indirect parent company of the Company) in an aggregate amount per year no greater than the aggregate amount of dividends per annum that were declarable and payable on such Treasury Capital Stock immediately prior to such retirement;

(3) the purchase, redemption, defeasance, repurchase or other acquisition or retirement of Subordinated Indebtedness of the Company or a Restricted Subsidiary made by exchange for, or out of the proceeds of the substantially concurrent sale of, new Indebtedness of the Company or a Restricted Subsidiary, as the case may be, so long as:

(a) such new Indebtedness is subordinated to the Notes or the applicable Guarantee at least to the same extent as such Subordinated Indebtedness so purchased, redeemed, defeased, repurchased, exchanged, acquired or retired for value;

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(b) such new Indebtedness has a final scheduled maturity date equal to or later than the final scheduled maturity date of the Subordinated Indebtedness being so purchased, redeemed, defeased, repurchased, exchanged, acquired or retired; and

(c) such new Indebtedness has a Weighted Average Life to Maturity equal to or greater than the remaining Weighted Average Life to Maturity of the Subordinated Indebtedness being so purchased, redeemed, defeased, repurchased, exchanged, acquired or retired;

(4) so long as no Default has occurred and is continuing, the purchase, redemption or other acquisition of shares of Capital Stock of the Company or any of its Subsidiaries from employees, former employees, directors or former directors of the Company or any of its Subsidiaries (or permitted transferees of such employees, former employees, directors or former directors), pursuant to the terms of the agreements (including employment agreements) or plans (or amendments thereto) approved by the Board of Directors under which such individuals purchase or sell or are granted the option to purchase or sell, shares of such Capital Stock; provided, however, that the aggregate amount of such Restricted Payments (excluding amounts representing cancellation of Indebtedness) shall not exceed $50.0 million in any calendar year;

(5) the declaration and payments of dividends on Disqualified Stock;provided, however, that, at the time of payment of such dividend, no Default shall have occurred and be continuing (or result therefrom);

(6) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options or warrants;

(7) other Restricted Payments in an aggregate amount taken together with all other Restricted Payments made pursuant to this clause (7) not to exceed $500.0 million;

(8) the distribution, by dividend or otherwise, of shares of Capital Stock of, or Indebtedness owed to the Company or a Restricted Subsidiary by, Unrestricted Subsidiaries;

(9) the repurchase, redemption or other acquisition or retirement for value of any Subordinated Indebtedness pursuant to provisions similar to those described under the captions —Repurchase at the Option of Holders —Change of Control Event and —Repurchase at the Option of Holders —Asset Sales;provided, however, that all Notes tendered by Holders in connection with a Change of Control Offer or Asset Sale Offer, as applicable, have been repurchased, redeemed, acquired or retired for value;

(10) cash payments in lieu of issuing fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests of the Company or any direct or indirect parent of the Company;provided, however, that any such cash payment shall not be for the purpose of evading the limitation of the covenant described under this subheading (as determined in good faith by the Company); and

(11) distributions required by, and made in accordance with, Section 4.4(b) of the LLC Operating Agreement as in effect on the Issue Date;

provided, however, that at the time of, and after giving effect to, any Restricted Payment permitted under clauses (7) and (8), no Default shall have occurred and be continuing or would occur as a consequence thereof.

All of the Subsidiaries of the Company, other than the Initial Unrestricted Subsidiaries, currently are Restricted Subsidiaries. Our Unrestricted Subsidiaries accounted for less than 1 percent of our revenues, net for the year

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ended December 31, 2013, and less than 1 percent of our total assets as of December 31, 2013. The Company will not permit any Unrestricted Subsidiary to become a Restricted Subsidiary except pursuant to the second to last sentence of the definition of “Unrestricted Subsidiary.” For purposes of designating any Restricted Subsidiary as an Unrestricted Subsidiary, all outstanding Investments by the Company and its Restricted Subsidiaries (except to the extent repaid) in the Subsidiary so designated will be deemed to be Investments in an amount determined as set forth in the last sentence of the definition of “Investments.” Such designation will be permitted only if a Restricted Payment in such amount would be permitted at such time and if such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. Unrestricted Subsidiaries will not be subject to any of the restrictive covenants set forth in the Indenture.

Line of Business

The Company will not, and will not permit any Restricted Subsidiary, to engage in any business other than a Similar Business.

Liens

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create, Incur, issue, assume, suffer to exist or permit to become effective any Lien to secure Indebtedness of any kind upon any of their assets, now owned or hereafter acquired, other than Permitted Liens.

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create, Incur, issue, assume, suffer to exist or permit to become effective any Lien of any kind upon any of their assets, now owned or hereafter acquired that secures Obligations under Indebtedness that is contractually senior in lien priority (without regard to control of remedies) to any security interest at any time granted to secure the Notes or the Guarantees and is also contractually junior in lien priority (without regard to control of remedies) to any security interest at any time granted to secure any other Indebtedness. The foregoing paragraph shall not apply to any assets on which the Notes do not have a Lien or any assets on which the Notes are not required to have a Lien.

For purposes of clause (8)(C) of the definition of “Permitted Liens,” the Consolidated Secured Debt Ratio shall be tested only as of the date of Incurrence of Secured Indebtedness pursuant thereto and, thereafter, shall be deemed not to have been violated with respect to such Incurrence as a result of subsequent changes in the Consolidated Secured Debt Ratio.

Limitation on Sale and Lease-Back Transactions

The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Lease-Back Transaction with respect to any property unless the Company or such Restricted Subsidiary would be entitled to create a Lien on such property securing such Attributable Debt under the covenant described under —Certain Covenants in the Indenture —Liens. After the Fall-Away Date, the foregoing reference to —Certain Covenants in the Indenture —Liens shall be to the covenant applicable after the Fall-Away Date as described under —Certain Covenants in the Indenture —Covenant Fall-Away —Limitation on Liens.

Impairment of Security Interest

The Company shall not, and shall not permit any Restricted Subsidiary to, take or knowingly or negligently omit to take, any action which action or omission could reasonably be expected to, have the result of materially impairing the security interests with respect to the Collateral for the benefit of the Collateral Agent and the Holders of the Notes (including materially impairing the lien priority of the Notes with respect thereto) (it being understood that any release described under —Security —Releases of Collateral and the incurrence of Permitted Liens shall not be deemed to so materially impair the security interests with respect to the Collateral).

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The Indenture provides that, at the direction of the Company and without the consent of the Holders, the Collateral Agent (or its agent or designee) shall from time to time enter into one or more amendments, extensions, renewals, restatements, supplements or other modifications or replacements to or of the Security Documents to: (i) cure any ambiguity, omission, defect or inconsistency therein that does not materially adversely affect the interests of the Holders, (ii) provide for Permitted Liens, (iii) add to the Collateral, (iv) release any Liens on the Collateral with respect to the Notes and the Guarantees in accordance with —Security —Releases of Collateral or (v) make any other change thereto that does not materially adversely affect the rights of the Holders, the Collateral Agent or any other security agent acting for such Holders.

Future Guarantors

The Company will cause each domestic Restricted Subsidiary that (i) Guarantees Indebtedness under any Credit Facility or (ii) holds assets in an amount equal to or greater than 5.0% of the Consolidated Net Tangible Assets of the Company to, promptly, execute and deliver to the Trustee and the Collateral Agent a Guarantee Agreement pursuant to which such Restricted Subsidiary will Guarantee payment of the Notes on the same terms and conditions as those set forth in the Indenture. The Company will cause each Restricted Subsidiary that becomes a Guarantor to execute and deliver to the Collateral Agent the applicable Security Documents pursuant to which its assets (of the same type as the assets of the Company and the other Guarantors constituting Collateral) will become part of the Collateral and will secure the Notes and Guarantees in the manner specified in the Indenture and the Security Documents.

Future Collateral

From and after the Issue Date, if the Issuers or any Guarantor creates any additional security interest upon any property or asset to secure any Indebtedness pursuant to clause (6), (7), (8), (11)(B) or (12)(B) of the definition of “Permitted Liens” or pursuant to clause (21) of the definition of “Permitted Liens” to the extent it relates to the refinancing of Indebtedness secured pursuant to clause (6), (7), (8), (11)(B) or (12)(B) of the definition of “Permitted Liens” (other than Liens on any DOE Assets or DOE Replacement Assets to secure the Senior Credit Facilities;provided, however, that such Liens to secure the Senior Credit Facilities are junior in priority to the Lien on such assets securing any Permitted DOE Facility or any Indebtedness secured pursuant to clause (12)(A) of the definition of “Permitted Liens”), it must use commercially reasonable efforts to concurrently execute and deliver such security instruments, financing statements and such certificates and opinions of counsel to vest in the CollateralAgent a perfected security interest (subject only to Permitted Liens) in such property or asset and to have such property or asset added to the Collateral, and thereupon all provisions of the Indenture relating to the Collateral shall be deemed to relate to such property or asset to the same extent and with the same force and effect. If granting a security interest in such property requires the consent of a third party, the Issuers or the applicable Guarantor will use commercially reasonable efforts to obtain such consent with respect to the junior-priority security interest for the benefit of the Collateral Agent on behalf of the Holders. If such third party does not consent to the granting of the junior-priority security interest after the use of such commercially reasonable efforts, the applicable entity will not be required to provide such security interest. It is possible that a third party might consent to the granting of first-priority security interests for the benefit of the First-Priority Lien Obligations, but might not consent to the granting of junior-priority security interests for the benefit of the Notes and the Guarantees in which case the Issuers and the Guarantors would not be required to grant a security interest in such assets in favor of the Notes and the Guarantees. The Notes and the Guarantees, therefore, would not benefit from a junior-priority security interest in such property that would secure the First-Priority Lien Obligation. SeeRisk Factors —Risks Related to Our Structure, the Notes and the Exchange Offers —Rights of holders of the Notes in the collateral may be adversely affected by the failure to perfect security interests in certain collateral.

Merger, Consolidation or Sale of All or Substantially All Assets

Other than in connection with a Corporate Reorganization, the Company may not, directly or indirectly, consolidate or merge with or into or wind up into (whether or not the Company is the surviving corporation), nor

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may the Company sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of the properties or assets of the Company and its Restricted Subsidiaries, taken as a whole, in one or more related transactions, to any Person unless:

(1) the Company is the surviving entity or the Person formed by or surviving any such consolidation or merger (if other than the Company) or the Person to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof, Canada or any province thereof, or any member state of the European Union (the Company or such Person, as the case may be, being herein called the “Successor Company”);provided, however, that in the case where the Successor Company is not a corporation, a co-obligor of the Notes is a corporation;

(2) the Successor Company, if other than the Company, expressly assumes all the obligations of the Company under the Indenture, the Notes and the Security Documents pursuant to a supplemental indenture or other documents or instruments;

(3) immediately after such transaction, no Default exists;

(4) immediately after givingpro forma effect to such transaction and any related financing transactions the Fixed Charge Coverage Ratio on a consolidated basis for the Successor Company and its Restricted Subsidiaries’ most recently ended four fiscal quarters for which internal financial statements are available immediately preceding the date of such transaction, calculated immediately after givingpro forma effect to such transaction and any related financing transactions as if the transaction had occurred at the beginning of the most recently ended four fiscal quarters for which internal financial statements are available, would have been (a) at least 2.00 to 1.00 or (b) not less than the Fixed Charge Coverage Ratio for the Company and its Restricted Subsidiaries immediately prior to such transaction without giving effect to such transaction;

(5) each Guarantor, unless it is the other party to the transactions described above, in which case clause (1)(b) of the second succeeding paragraph shall apply, shall have by supplemental indenture confirmed that its Guarantee and security interest under the Security Documents shall apply to such Person’s obligations under the Indenture, the Guarantee, the Notes and the Security Documents; and

(6) the Company shall have delivered to the Trustee and the Collateral Agent an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indentures, if any, comply with the Indenture.

Subject to certain limitations described in the Indenture governing release of a Guarantee upon the sale, disposition or transfer of a guarantor, no Guarantor will, and the Company will not permit any Guarantor to, directly or indirectly, consolidate or merge with or into or wind up into (whether or not the Company or such Guarantor is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets, in one or more related transactions, to any Person unless:

(1) (a) such Guarantor is the surviving Person or the Person formed by or surviving any such consolidation or merger (if other than such Guarantor) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is organized or existing under the laws of the jurisdiction of organization of such Guarantor, as the case may be, or the laws of the United States, any state thereof, the District of Columbia, or any territory thereof, Canada or any province thereof or any member state of the European Union (such Guarantor or such Person, as the case may be, being herein called the “Successor Person”);

(b) the Successor Person, if other than such Guarantor, expressly assumes all the obligations of such Guarantor under the Indenture, such Guarantor’s related Guarantee and such Guarantor’s

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obligations related to the Security Documents, pursuant to supplemental indentures or other documents or instruments;

(c) immediately after such transaction, no Default exists; and

(d) the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indentures, if any, comply with the Indenture; or

(2) the transaction complies with clauses (1) and (2) of the first paragraph of the covenant described under —Repurchase at the Option of Holders —Asset Sales to the extent applicable.

In the case of clause (1) of the immediately preceding paragraph, the Successor Person will succeed to, and be substituted for, such Guarantor under the Indenture, such Guarantor’s Guarantee and such Guarantor’s obligations under the Security Documents. Notwithstanding the foregoing, any Guarantor may (1) merge or consolidate with or into or wind up into or transfer all or part of its properties and assets to another Guarantor or the Company, (2) merge with an Affiliate of the Company solely for the purpose of reincorporating the Guarantor in the United States, any state thereof, the District of Columbia or any territory thereof or (3) convert into (which may be effected by merger with a Restricted Subsidiary that has substantially no assets and liabilities) a corporation, partnership, limited partnership, limited liability corporation or trust organized or existing under the laws of the jurisdiction of organization of such Guarantor (which may be effected by merger so long as the survivor thereof is a Guarantor).

The Co-Issuer may not, directly or indirectly, consolidate or merge with or into or wind up into (whether or not the Co-Issuer is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of the Co-Issuer’s properties or assets, in one or more related transactions, to any Person unless:

(1) (a) concurrently therewith, a corporate Wholly Owned Restricted Subsidiary of the Company organized and validly existing under the laws of the United States, any state thereof, the District of Columbia or any territory thereof (which may be the continuing Person as a result of such transaction) expressly assumes all the obligations of the Co-Issuer under the Notes, pursuant to supplemental indentures or other documents or instruments, and the Registration Rights Agreement if the exchange offer contemplated therein has not been consummated or if the Issuers continue to have an obligation to file or maintain the effectiveness of a shelf registration statement as provided under such agreement; or

(b) after giving effect thereto, at least one obligor on the notes shall be a corporation organized and validly existing under the laws of the United States, any state thereof, the District of Columbia or any territory thereof;

(2) immediately after such transaction, no Default exists; and

(3) the Co-Issuer shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture, if any, comply with the Indenture.

Transactions with Affiliates

The Company will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of their properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of the Fiat Group (each of the foregoing, a “Fiat Transaction”) involving aggregate payments or consideration in excess of $100.0 million (as determined in good faith by the Company), unless such

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Fiat Transaction is (1) not materially less favorable to the Company or the Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person or (2) as determined in good faith by the Company, reasonable under the circumstances.

The Company will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of their properties or assets to, or purchase any property or assets from,or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (other than the Fiat Group) of the Company (each of the foregoing, an “Affiliate Transaction”) involving aggregate payments or consideration in excess of $100.0 million, unless:

(1) such Affiliate Transaction is, as determined in good faith by the Company, on terms that are not materially less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person on an arm’s-length basis; and

(2) if such Affiliate Transaction or series of related Affiliate Transactions involve aggregate payments or consideration in excess of $250.0 million, the Company delivers to the Trustee a resolution adopted by the majority of the Board of Directors approving such Affiliate Transaction and set forth in an Officer’s Certificate certifying that such Affiliate Transaction complies with clause (1) above.

The provisions related to Fiat Transactions and Affiliate Transactions will not apply to the following:

(1) transactions between or among the Company or any of its Restricted Subsidiaries;

(2) Restricted Payments permitted by the provisions of the Indenture described above under the covenant —Certain Covenants in the Indenture —Limitation on Restricted Payments;

(3) the payment of reasonable and customary fees and compensation paid to, and indemnities provided on behalf of, employees, officers, directors or consultants of the Company or any of its Restricted Subsidiaries;

(4) any agreement as in effect as of the Issue Date and described under the headingCertain Relationships and Related Party Transactions, or any amendment thereto (so long as any such amendment is not disadvantageous in any material respect (as determined in good faith by the Company) to the Holders when taken as a whole as compared to the applicable agreement as in effect on the Issue Date;

(5) any agreement as in effect as of the Issue Date, or entered into thereafter as contemplated by the Master Industrial Agreement as in effect on the Issue Date, between or among any member of the Fiat Group, on the one hand, and the Company and any of its Subsidiaries, on the other hand;

(6) transactions with customers, clients, suppliers, contractors, joint venture partners or purchasers or sellers of goods or services, in each case in the ordinary course of business, or are on terms at least as favorable as would reasonably have been obtained at such time from an unrelated Person (as determined in good faith by the Company);

(7) the issuance of Equity Interests by the Company or a Restricted Subsidiary;

(8) transactions with the Company, a Restricted Subsidiary or joint venture or similar entity which would constitute an Affiliate Transaction solely because the Company or a Restricted Subsidiary owns an equity interest in or otherwise controls such Restricted Subsidiary, joint venture or similar entity;

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(9) payments or loans (or cancellation of loans) to employees or consultants of the Company, any of its direct or indirect parent companies or any of its Restricted Subsidiaries, but in any event not to exceed $50.0 million in the aggregate outstanding at any one time, and employment agreements, severance arrangements, stock option plans and other similar arrangements with such employees or consultants which, in each case, are approved by the Board of Directors;

(10) the existence of, or the performance by the Company or any Restricted Subsidiary of its obligations under the terms of, any limited liability company operating agreement, shareholders agreement (including any registration rights agreement or purchase agreement related thereto) to which it is a party as of the Issue Date and any similar agreements that it may enter into after the Issue Date;provided, however, that any such similar agreement or any amendment, taken as a whole, is not materially less favorable to the Company and its Restricted Subsidiaries than the agreement as in effect on the Issue Date (as determined in good faith by the Company);

(11) transactions in the ordinary course of business with (i) Unrestricted Subsidiaries or (ii) joint ventures in which the Company or a Restricted Subsidiary holds or acquires an ownership interest (whether by way of equity interest or otherwise) so long as the terms of any such transactions are not materially less favorable to the Company or the Restricted Subsidiary participating in such joint ventures than they are to other joint venture partners that are not otherwise Affiliates of the Company;

(12) transactions with respect to which the Company or the Board of Directors has received a written opinion from an Independent Advisor with respect to the fairness of such transaction or a written opinion from an Independent Advisor that such transaction is on terms are not materially less favorable to the Company or the Restricted Subsidiary than those that the Company and its Restricted Subsidiaries than could reasonably be expected to be obtained at the time in an arm’s length transaction with a Person who is not an Affiliate; and

(13) transactions between or among any member of the Fiat Group, on the one hand, and the Company and any of its Subsidiaries, on the other hand, which are approved by a majority of the Non-Fiat Directors.

Reports and Other Information

The Indenture provides that, whether or not the Company is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company will file with the SEC and provide the Holders of the Notes with such annual reports and such information, documents and other reports as are specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to such Sections, such information, documents and other reports to be so filed and provided at the times specified for the filings of such information, documents and reports under such Sections and containing all the information, audit reports and exhibits required for such reports. If at any time, the Company is not subject to the periodic reporting requirements of the Exchange Act for any reason, the Company shall nevertheless continue filing the reports specified in the preceding sentence with the SEC within the time periods required by such sentence unless the SEC shall not accept such filing. The Company shall not take any action for the purpose of causing the SEC not to accept any such filings. In addition, the Company shall post any such required reports on its website within the time periods that would apply whether or not the company is required to file those reports with the SEC.

In connection with the filing or posting of all annual and quarterly reports required pursuant to the above paragraph, in connection therewith, the Company shall provide notice of, and host, a conference call open to the public to discuss the results for the applicable period.

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Limitation on Business Activities of the Co-Issuer

The Co-Issuer may not hold any assets, become liable for any obligations or engage in any business activities;providedthat it may be a co-obligor with respect to the Notes or any other Indebtedness issued by the Company and may engage in any activities directly related thereto or necessary in connection therewith. The Co-Issuer shall be a Wholly Owned Subsidiary and a Restricted Subsidiary of the Company (or its permitted successors) at all times.

Covenant Fall-Away

The Indenture provides that following the first day (the “Fall-Away Date”) that:

(1) the Notes have had an Investment Grade Rating from both of the Rating Agencies for at least 60 consecutive days and the Company has delivered written notice of such Investment Grade Ratings to the Trustee and the Collateral Agent; and

(2) no Default has occurred and is continuing under the Indenture,

the Company and its Restricted Subsidiaries will not be subject to the provisions of the Indenture summarized above under:

(1) —Limitation on Restricted Payments;

(2) —Line of Business;

(3) —Liens;

(4) —Impairment of Security Interest;

(5) clause (4) of the first paragraph under —Merger, Consolidation or Sale of All or Substantially All Assets;

(6) —Future Collateral;

(7) —Repurchase at the Option of Holders —Asset Sales; and

(8) —Transactions with Affiliates;

In addition, from and after the Fall-Away Date, the Liens on the Collateral will be automatically released with respect to the Notes and the Guarantees.

Limitation on Liens

From and after the Fall-Away Date, other than Excepted Liens, the Company will not, and will not permit any of its Subsidiaries to, directly or indirectly, create, Incur, issue, assume, suffer to exist or permit to become effective any Lien to secure Indebtedness of any kind upon any Principal Property or upon any shares of Capital Stock or Indebtedness of any Subsidiary of the Company that owns any Principal Property (whether now owned or hereafter acquired) without effectively providing concurrently therewith that the Notes (together with, if the Company shall so determine, any other Indebtedness of or guarantee by the Company or such Subsidiary ranking equally with the Notes) shall be secured equally and ratably with (or, at the option of the Company, prior to) the Indebtedness secured by such Lien until such time as such Indebtedness is no longer secured by such Lien.

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From and after the Fall-Away Date, any references in thisDescription of the Notes to the covenant described under —Liens shall be deemed to be a reference to the covenant described under—Limitation on Liens.

Certain Definitions After the Fall-Away Date

Solely for purposes of covenants under—Covenant Fall-Away, the following terms shall have the following meanings.

“Excepted Liens” means (a) Liens existing on property or other assets at the time the Company or a Subsidiary acquired the property or such other assets, including any acquisition by means of an amalgamation, merger or consolidation with or into the Company or any of its Subsidiaries;provided, however, that such Liens are not created or incurred in connection with, or in contemplation of, such acquisition, amalgamation, merger or consolidation; (b)(1) Liens existing on property or shares of stock or other assets of a Person at the time such Person becomes a Subsidiary, or Liens existing thereon to secure the payment of all or any part of the purchase price thereof, or (2) Liens existing on property or shares of stock or other assets of a Person to secure any Indebtedness for borrowed money incurred prior to, at the time of, or within one year after, the latest of the acquisition thereof, or, in the case of property, the completion of construction, the completion of improvements or the commencement of substantial commercial operation of such property for the purpose of financing all or any part of the purchase price thereof, such construction or the making of such improvements; (c) Liens to secure Indebtedness for borrowed money owing to the Company or to any of its Subsidiaries; (d) Liens existing on the Fall-Away Date; (e) any Lien that would qualify as a “Permitted Lien”, except for Liens that would qualify as a “Permitted Lien” pursuant to clauses (6), (7), (8), (9), (10), (11) and (12) thereof; and (f) Liens to secure any refinancing, refunding, extension, renewal or replacement (or successive refinancing, refunding, extensions, renewals or replacements) as a whole, or in part, of any Indebtedness secured by any Lien referred to in the foregoing clauses (a) through (e), without increase of the principal of the Indebtedness secured thereby;provided, however, that (i) such new Lien shall be limited to all or part of the same property that was subject to the original Lien (plus improvements on such property) and (ii) the obligations under Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (x) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clauses (a) through (e) above at the time the original Lien became an Excepted Lien under the Indenture, and (y) an amount necessary to pay premiums (including tender premiums), defeasance costs and fees and expenses in connection with such refinancing, refunding, extension, renewal or replacement;provided further, however, that the Liens permitted by any of the foregoing clauses (a) through (d) may not extend to any other property owned by the Company or any of its Subsidiaries other than the property specified in such clauses and improvements thereto.

“Principal Property” means the land, land improvements, buildings and fixtures (to the extent they constitute real property interests) (including any leasehold interest therein) constituting the principal corporate office, any manufacturing plant or any manufacturing facility (whether now owned or hereafter acquired) and the equipment located thereon which (a) is owned by the Company or any of its domestic Subsidiaries; (b) is located in the United States; (c) has not been determined in good faith by the Board of Directors not to be materially important to the total business conducted by the Company and its Subsidiaries taken as a whole; and (d) has a net book value on the date of determination in excess of 10.0% of Consolidated Net Tangible Assets.

For purposes of the covenant described under —Repurchase at the Option of Holders —Asset Sales, on any Fall-Away Date, the Net Proceeds amount will be reset to zero. In addition, upon the occurrence of the Fall-Away Date, any Defaults with respect to such terminated covenants that have not matured into Events of Default will be rescinded.

There can be no assurance that the Notes will ever achieve or maintain Investment Grade Ratings. If the Notes do achieve Investment Grade Ratings and the Fall-Away Date occurs, the Notes will have the limited covenants described above even if the Notes lose their Investment Grade Ratings after such date.

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Events of Default and Remedies

The Indenture provides that each of the following is an Event of Default with respect to any series of Notes:

(1) default in payment when due and payable, upon redemption, acceleration or otherwise, of principal of, or premium, if any, on the Notes of that series;

(2) default for 30 days or more in the payment when due of interest on or with respect to that series of Notes;

(3) the failure by the Issuers to comply with their obligations under —Certain Covenants in the Indenture —Merger, Consolidation or Sale of All or Substantially All Assets above with respect to that series of Notes;

(4) the failure by the Company to comply for 60 days after notice to the Company by the Trustee or to the Company and the Trustee by Holders of at least 25% in principal amount of Notes of such series with its obligation to make a Change of Control Offer in accordance with —Repurchase at the Option of Holders —Change of Control Event with respect to that series of Notes;

(5) the failure by the Company to comply for 120 days after notice to the Company by the Trustee or to the Company and the Trustee by Holders of at least 25% in principal amount of Notes of such series with its obligations under —Certain Covenants in the Indenture —Reports and Other Information above with respect to that series of Notes;

(6) the failure by the Issuers or any Guarantor to comply for 60 days after notice to the Company by the Trustee or to the Company and the Trustee by Holders of at least 25% in principal amount of Notes of such series with any of its other obligations, covenants or agreements contained in the Indenture, the Security Documents or the Notes applicable to that series of Notes;

(7) Indebtedness of the Company, the Co-Issuer, any Guarantor or any Significant Party is not paid within any applicable grace period after final maturity or is accelerated by the holders thereof because of a default and the total amount of such Indebtedness unpaid or accelerated exceeds $500.0 million;provided, however, that it will be deemed not to be an Event of Default if such Indebtedness is paid or otherwise acquired or retired (or for which such failure to pay or acceleration is waived or rescinded) within 30 Business Days after such failure to pay or such acceleration;

(8) the failure by the Company, the Co-Issuer or any other Significant Party to pay final non-appealable judgments aggregating in excess of $500.0 million, which final judgments remain unpaid, undischarged and unstayed for a period of more than 60 days after such judgments become final, and in the event such judgment is covered by insurance, an enforcement proceeding has been commenced by any creditor upon such judgment or decree which is not promptly stayed;

(9) certain events of bankruptcy or insolvency with respect to the Company, the Co-Issuer or any other Significant Party;

(10) the Guarantee of any Significant Party with respect to that series of Notes shall for any reason cease to be in full force and effect or be declared null and void or any Officer of any Guarantor that is a Significant Party, as the case may be, denies in writing that it has any further liability under its Guarantee with respect to that series of Notes or gives written notice to such effect, other than by reason of the termination of the Indenture or the release of any such Guarantee with respect to that series of Notes in accordance with the Indenture; or

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(11) the security interest in the Collateral created under any Security Document with respect to that series of Notes shall, at any time, cease to be in full force and effect and constitute a valid and perfected Lien with the priority required by the Indenture for any reason other than (A) the satisfaction in full of all obligations under the Indenture and discharge of the Indenture or in accordance with the terms of the Intercreditor Agreement or (B) as provided under —Security —Releases of Collateral above or any security interest created under any Security Document shall be invalid or unenforceable, in each case, on any material portion of the Collateral purported to be covered thereby, or the Company or any Guarantor required to grant a security interest in Collateral shall assert, in any pleading in any court of competent jurisdiction, that any such security interest is invalid or unenforceable and in each case such failure or such assertion shall have continued uncured or unrescinded for a period of 20 days.

If any Event of Default (other than of a type specified in clause (9) above with respect to the Company or the Co-Issuer) occurs and is continuing under the Indenture, the Trustee or the Holders of at least 25% in aggregate principal amount of the particular series of Notes then outstanding may declare the principal, premium, if any, interest and any other monetary obligations on all the then outstanding Notes of that series to be due and payable immediately. Upon the effectiveness of such declaration, such principal and interest will be due and payable immediately. Notwithstanding the foregoing, in the case of an Event of Default arising under clause (9) of the first paragraph of this section with respect to the Company or the Co-Issuer, all outstanding Notes will become due and payable without further action or notice. The Indenture provides that the Trustee may withhold from the Holders notice of any continuing Default, except a Default relating to the payment of principal, premium, if any, or interest, if it determines that withholding notice is in their interest. In addition, the Trustee shall have no obligation to accelerate the Notes if in the best judgment of the Trustee acceleration is not in the best interest of the Holders of the Notes with respect to that series of Notes.

The Indenture provides that the Holders of a majority in aggregate principal amount of the then outstanding Notes of any series under the Indenture by notice to the Trustee may, on behalf of the Holders of all of the Notes of that series, waive any existing Default with respect to that series of Notes and its consequences under the Indenture (except a continuing Default in the payment of interest on, premium, if any, or the principal of any Note held by a non-consenting Holder) and rescind any acceleration with respect to the Notes of that series and its consequences (except if such rescission would conflict with any judgment of a court of competent jurisdiction). In the event of any Event of Default specified in clause (7) above, such Event of Default and all consequences thereof (excluding any resulting payment default, other than as a result of acceleration of the Notes) shall be annulled, waived and rescinded, automatically and without any action by the Trustee or the Holders, if within 20 days after such Event of Default arose:

(1) the Indebtedness or guarantee that is the basis for such Event of Default has been discharged; or

(2) Holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default; or

(3) the default that is the basis for such Event of Default has been cured.

Subject to the provisions of the Indenture relating to the duties of the Trustee thereunder, in case an Event of Default with respect to any series of Notes occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any of the Holders of such series of Notes outstanding thereunder unless the Holders of such series of Notes have offered to the Trustee indemnity or security satisfactory to the Trustee against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium (if any) or interest when due, no Holder of a series of Notes may pursue any remedy with respect to the Indenture or such series of Notes unless:

(1) such Holder has previously given the Trustee notice that an Event of Default with respect to such series is continuing;

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(2) Holders of at least 25% in aggregate principal amount of the then outstanding Notes of that series have requested the Trustee to pursue the remedy;

(3) Holders of the Notes of that series have offered the Trustee security or indemnity satisfactory to the Trustee against any loss, liability or expense;

(4) the Trustee has not complied with such request within 60 days after the receipt thereof and the offer of security or indemnity; and

(5) Holders of a majority in aggregate principal amount of the then outstanding Notes of that series have not given the Trustee a direction inconsistent with such request within such 60-day period.

Subject to certain restrictions, under the Indenture the Holders of a majority in aggregate principal amount of a series of outstanding Notes thereunder are given the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee with respect to such series of Notes. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture or that the Trustee determines is unduly prejudicial to the rights of any other Holder of a Note or that would involve the Trustee in personal liability.

The Issuers are required to deliver to the Trustee and the Collateral Agent annually a statement regarding compliance with the Indenture, and the Issuers are required, within five Business Days after the dates on which a senior officer of the Company becomes aware of any Default, to deliver to the Trustee and the Collateral Agent a statement specifying such Default.

No Personal Liability of Directors, Officers, Employees and Stockholders

No past, present or future director, officer, employee, incorporator, member, partner or stockholder of the Issuers or any Guarantor or any of their direct or indirect equity holders shall have any liability for any obligations of the Issuers or the Guarantors under the Notes, the Guarantees or the Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation. Each Holder by accepting Notes waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy.

Legal Defeasance and Covenant Defeasance

With respect to any series of Notes, the obligations of the Issuers and the Guarantors under the Indenture and such series of Notes will terminate (other than certain obligations) and will be released upon payment in full of all of the Notes of that series issued thereunder. The Issuers may, at their option and at any time, elect to have all of their obligations discharged with respect to any series of Notes and have each Guarantor’s obligations discharged with respect to its Guarantee of that series of Notes and have the Security Documents terminated and Collateral released with respect to that series of Notes (“Legal Defeasance”) and cure all then existing Events of Default with respect to that series of Notes except for:

(1) the rights of Holders of Notes of that series to receive payments in respect of the principal of, premium, if any, and interest on the Notes of that series when such payments are due solely out of the trust created pursuant to the Indenture for those Notes;

(2) the Issuers’ obligations with respect to any series of Notes concerning issuing temporary Notes, registration of such Notes, mutilated, destroyed, lost or stolen Notes and the maintenance of an office or agency for payment and money for security payments held in trust;

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(3) the rights, powers, trusts, duties and immunities of the Trustee, Registrar, Paying Agent and Collateral Agent and the Issuers’ obligations in connection therewith; and

(4) the Legal Defeasance provisions of the Indenture.

In addition, with respect to any series of Notes, the Issuers may, at their option and at any time, elect to have their obligations and those of each Guarantor released with respect to substantially all of the restrictive covenants in the Indenture with respect to such series of Notes and have the Security Documents terminated and Collateral released with respect to that series of Notes (“Covenant Defeasance”) and thereafter any omission to comply with such obligations shall not constitute a Default with respect to that series of Notes. In the event Covenant Defeasance occurs with respect to a series of Notes, certain events (not including bankruptcy, receivership, rehabilitation and insolvency events pertaining to the Issuers) described under —Events of Default and Remedies will no longer constitute an Event of Default with respect to that series of Notes. If the Issuers exercise either their Legal Defeasance or Covenant Defeasance option with respect to a series of Notes, the Guarantees of the Guarantors will be released with respect to that series of Notes and the Guarantors will be released from all of their obligations with respect to that series of Notes and the Security Documents.

In order to exercise either Legal Defeasance or Covenant Defeasance with respect to a series of Notes:

(1) the Issuers must irrevocably deposit with the Collateral Agent, in trust, for the benefit of the Holders of that series of Notes, cash in U.S. dollars, Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal amount of, premium, if any, and interest due on that series of Notes on the stated maturity date or on the redemption date, as the case may be, of such principal amount, premium, if any, or interest on such Notes, and the Issuers must specify whether such Notes are being defeased to maturity or to a particular redemption date;

(2) in the case of Legal Defeasance, the Issuers shall have delivered to the Trustee and the Collateral Agent an Opinion of Counsel reasonably acceptable to the Trustee and the Collateral Agent confirming that, subject to customary assumptions and exclusions,

(a) the Issuers have received from, or there has been published by, the United States Internal Revenue Service a ruling, or

(b) since the issuance of the Notes of that series, there has been a change in the applicable U.S. federal income tax law,

in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, subject to customary assumptions and exclusions, the Holders of that series of Notes will not recognize income, gain or loss for U.S. federal income tax purposes, as applicable, as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

(3) in the case of Covenant Defeasance, the Issuers shall have delivered to the Trustee and the Collateral Agent an Opinion of Counsel in form reasonably acceptable to the Trustee and the Collateral Agent confirming that, subject to customary assumptions and exclusions, the Holders of that series of Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to such tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;

(4) no Default with respect to that series of Notes (other than that resulting from borrowing funds to be applied to make such deposit and any similar and simultaneous deposit relating to such other

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Indebtedness, and in each case, the granting of Liens in connection therewith) shall have occurred and be continuing on the date of such deposit;

(5) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under the Senior Credit Facilities or any other material agreement or instrument governing Indebtedness (other than the Indenture) to which, the Issuers or any Guarantor is a party or by which the Issuers or any Guarantor is bound (other than that resulting from any borrowing of funds to be applied to make the deposit required to effect such Legal Defeasance or Covenant Defeasance and any similar and simultaneous deposit relating to other Indebtedness, and, in each case, the granting of Liens in connection therewith);

(6) the Issuers shall have delivered to the Trustee and the Collateral Agent an Officer’s Certificate stating that the deposit was not made by the Issuers with the intent of defeating, hindering, delaying or defrauding any creditors of the Issuers or any Guarantor or others; and

(7) the Issuers shall have delivered to the Trustee and the Collateral Agent an Officer’s Certificate and an Opinion of Counsel (which Opinion of Counsel may be subject to customary assumptions and exclusions) each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance, as the case may be, have been complied with.

Satisfaction and Discharge

The Indenture will be discharged and will cease to be of further effect with respect to a particular series of Notes issued thereunder and the Security Documents and pledges thereunder will be released with respect to that series of Notes, when either:

(1) all Notes of that series theretofore authenticated and delivered, except lost, stolen or destroyed Notes which have been replaced or paid and Notes of that series for whose payment money has theretofore been deposited in trust, have been delivered to the Registrar for cancellation; or

(2) (a) all Notes of that series not theretofore delivered to the Registrar for cancellation have become due and payable by reason of the making of a notice of redemption or otherwise, will become due and payable within one year or are to be called for redemption and redeemed within one year under arrangements satisfactory to the Trustee, the Registrar, the Collateral Agent and the Paying Agent for the giving of notice of redemption by the Trustee, the Registrar, the Collateral Agent or the Paying Agent in the name, and at the expense, of the Issuers, and the Issuers or any Guarantor has irrevocably deposited or caused to be deposited with the Paying Agent as trust funds in trust solely for the benefit of the Holders of the Notes of that series cash in U.S. dollars, Government Securities, or a combination thereof, in such amounts as will be sufficient without consideration of any reinvestment of interest to pay and discharge the entire indebtedness on the Notes not theretofore delivered to the Registrar for cancellation for principal, premium, if any, and accrued interest to the date of maturity or redemption thereof, as the case may be;

(b) with respect to that series of Notes, no Default (other than that resulting from borrowing funds to be applied to make such deposit or any similar and simultaneous deposit relating to other Indebtedness and in each case, the granting of Liens in connection therewith) with respect to the Indenture or that series of Notes shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under any Senior Credit Facilities or any other material agreement or instrument governing Indebtedness (other than the Indenture) to which the Issuers or any Guarantor is a party or by which the Issuers or any Guarantor is bound (other than resulting from any borrowing of funds to be applied to make such deposit and any similar

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and simultaneous deposit relating to other Indebtedness and, in each case, the granting of Liens in connection therewith);

(c) the Issuers have paid or caused to be paid all sums payable by them under the Indenture with respect to such series of Notes; and

(d) the Issuers have delivered irrevocable instructions to the Paying Agent to apply the deposited money toward the payment of the Notes of that series at maturity or the redemption date, as the case may be.

In addition, the Issuers must deliver an Officer’s Certificate and an Opinion of Counsel to the Trustee and the Collateral Agent stating that all conditions precedent to satisfaction and discharge have been satisfied.

Amendment, Supplement and Waiver

Except as provided in the next two succeeding paragraphs, the Indenture, any Guarantee, the Notes and the Security Documents may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of each series of Notes affected and then outstanding, other than Notes beneficially owned by the Issuers or any of their Affiliates, including consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes, and any existing Default or Event of Default or compliance with any provision of the Indenture or the Notes may be waived with the consent of the Holders of at least a majority in aggregate principal amount of each series of Notes then outstanding, other than Notes beneficially owned by the Issuers or any of their Affiliates (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes).

The Indenture provides that, without the consent of each affected Holder of Notes, an amendment or waiver may not, with respect to any Notes held by a non-consenting Holder:

(1) reduce the principal amount of such Notes whose Holders must consent to an amendment, supplement or waiver;

(2) reduce the principal amount of or change the fixed final maturity of any such Note or alter or waive the provisions with respect to the redemption of such Notes (other than provisions relating to the covenant described above under —Repurchase at the Option of Holders);

(3) reduce the rate of or change the time for payment of interest on any Note;

(4) waive a Default in the payment of principal of or premium, if any, or interest on the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the Notes and a waiver of the payment default that resulted from such acceleration) or in respect of a covenant or provision contained in the Indenture or any Guarantee which cannot be amended or modified without the consent of all affected Holders;

(5) make any Note payable in money other than that stated therein;

(6) make any change in the provisions of the Indenture relating to waivers of past Defaults or the rights of Holders to receive payments of principal of or premium, if any, or interest on the Notes;

(7) make any change in these amendment and waiver provisions;

(8) impair the right of any Holder to receive payment of principal of, or interest on such Holder’s Notes on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder’s Notes;

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(9) (a) make any change to the ranking of the Notes or (b) make any change to any provisions in the Security Documents or the Intercreditor Agreement or the Indenture dealing with the application of proceeds of Collateral, in each case that would materially adversely affect the rights of the Holders of the Notes;

(10) except as expressly permitted by the Indenture, modify the Guarantees of any Significant Party in any manner materially adverse to the Holders of the Notes; or

(11) after the Issuers’ obligation to purchase Notes arises thereunder, amend, change or modify in any respect materially adverse to the Holders of the Notes the obligations of the Company to make and consummate a Change of Control Offer in the event of a Change of Control Event or make and consummate an Asset Sale Offer with respect to any Asset Sale that has been consummated or, after such Change of Control has occurred or such Asset Sale has been consummated, modify any of the provisions or definitions with respect thereto in a manner that is materially adverse to the Holders of the Notes.

Notwithstanding the foregoing, the Issuers, the Trustee and the Collateral Agent may amend or supplement the Indenture and the Notes, the Issuers, the Collateral Agent and the Guarantors may amend or supplement any Guarantee issued under the Indenture, and the Issuers, the other Pledgors and the Collateral Agent may amend the Security Documents, in each case, without the consent of any Holder:

(1) to cure any ambiguity, omission, mistake, defect or inconsistency that does not materially adversely affect the rights of the Holders;

(2) to provide for uncertificated Notes in addition to or in place of certificated Notes;

(3) to comply with the covenant relating to mergers, consolidations and sales of assets;

(4) to provide for the assumption of the Issuers’ or any Guarantor’s obligations to the Holders;

(5) to make any change that would provide any additional rights or benefits to the Holders or that does not materially adversely affect the legal rights under the Indenture of any such Holder;

(6) to add covenants for the benefit of the Holders or to surrender any right or power conferred upon the Issuers or any Guarantor;

(7) to comply with requirements of the SEC in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act;

(8) to evidence and provide for the acceptance and appointment under the Indenture of a successor Trustee thereunder pursuant to the requirements thereof;

(9) to add a Guarantor under the Indenture or to add to, or remove a limitation on, the Collateral;

(10) to conform the text of the Indenture or the Guarantees or the Notes issued thereunder to any provision of thisDescription of the Notes to the extent that such provision in thisDescription of the Notes was intended to be a verbatim recitation of a provision of the Indenture, Guarantee or Notes, as provided in an Officer’s Certificate;

(11) to release Collateral from the Liens pursuant to the Indenture, the Security Documents and the Intercreditor Agreement when permitted or required by the Indenture, the Security Documents or the Intercreditor Agreement; or

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(12) to make any amendment to the provisions of the Indenture relating to the transfer and legending of Notes as permitted by the Indenture, including to facilitate the issuance and administration of the Notes;provided, however, that (i) compliance with the Indenture as so amended would not result in Notes being transferred in violation of the Securities Act or any applicable securities law and (ii) such amendment does not materially and adversely affect the rights of Holders to transfer Notes.

However, no amendment or supplement to the Indenture or the Notes that modifies or waives the specific rights or obligations of the Paying Agent, registrar or transfer agent may be made without the consent of such agent (it being understood that the Trustee’s execution of any such amendment or supplement will constitute such consent if the Trustee is then also acting as such agent).

The consent of the Holders is not necessary under the Indenture to approve the particular form of any proposed amendment. It is sufficient if such consent approves the substance of the proposed amendment.

Until all First-Priority Lien Obligations have been fully and finally discharged, the holders of the First-Priority Lien Obligations may change, waive, modify or vary the security documents of such holders and, pursuant to the Intercreditor Agreement, such changes will automatically apply to the Security Documents;provided, however, that any such change, waiver, modification or variance that is prejudicial to the rights of the Collateral Agent, the Trustee and the Holders of the Notes and does not affect the holders of the First-Priority Lien Obligations in a like or similar manner shall not apply to the Security Documents without the consent of the Collateral Agent and the Trustee (acting at the direction of the Holders of a majority of the aggregate principal amount of the Notes). Notice of such amendment, waiver or consent shall be given to the Trustee and the Collateral Agent by the Company, but any failure to provide such notice will not affect the validity or effectiveness of any such amendment, waiver or consent.

No amendment of, or supplement or waiver to, the Indenture, the Notes or the Security Documents (other than the Intercreditor Agreement) shall be permitted to be effected if such amendment, supplement or waiver is in violation of, or inconsistent with, the terms of the Intercreditor Agreement. No amendment of, or supplement to, the Intercreditor Agreement shall be permitted to be effected without the consent of the First-Priority Collateral Agent and Collateral Agent.

Notices

Notices given by publication will be deemed given on the first date on which publication is made and notices given by first-class mail, postage prepaid, will be deemed given five calendar days after mailing.

Concerning the Trustee and the Collateral Agent

The Indenture contains certain limitations on the rights of the Trustee thereunder, should it become a creditor of the Issuers, to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The Trustee will be permitted to engage in other transactions; however, if the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the SEC for permission to continue or resign.

The Indenture provides that the Holders of a majority in aggregate principal amounts of the then outstanding Notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee, subject to certain exceptions. The Indenture provides that in case an Event of Default shall occur (which shall not be cured), the Trustee will be required, in the exercise of its power, to use the degree of care of a prudent person in the conduct of his own affairs. Subject to such provisions, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request of any Holder of Notes, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.

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Governing Law

The Indenture, the Notes, the Security Documents and any Guarantee are governed by and construed in accordance with the laws of the State of New York (or, to the extent required, the law of the jurisdiction in which the Collateral is located), without regard to conflicts of laws principles thereof.

Certain Definitions and Conventions

Unless otherwise specified, any value to be determined under the Indenture will be determined by the Company as set forth in this paragraph. With respect to any provision of the Indenture that specifies a value or requires or provides for a determination of the value of any item or amount, the value shall be as determined in good faith by an Officer of the Company;provided however, that if the value of such item or amount is equal to or greater than $500.0 million, such determination shall be made in good faith by the Board of Directors. Any such determination shall be conclusive for all purposes under the Indenture.

The Indenture does not treat (1) unsecured indebtedness as subordinated or junior to Secured Indebtedness merely because it is unsecured or (2) Indebtedness as subordinated or junior to any other Indebtedness merely because it has a junior priority with respect to the same collateral.

Set forth below are certain defined terms used in the Indenture. For purposes of the Indenture, unless otherwise specifically indicated, the term “consolidated” with respect to any Person refers to such Person consolidated with its Restricted Subsidiaries, and excludes from such consolidation any Unrestricted Subsidiary as if such Unrestricted Subsidiary were not an Affiliate of such Person.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise;provided that for purposes of the covenant entitled —Certain Covenants in the Indenture —Transactions with Affiliates, the term “Affiliate” also means any Person that is a director or an executive officer of the Person specified. For all purposes under the Indenture, none of (i) the Government of the United States (or any branch or agency thereof), (ii) Canada CH Investment Corporation, or (iii) the VEBA Trust shall be considered an affiliate of the Issuers or any of their respective Subsidiaries.

“Applicable Premium” means, with respect to any Note on any Redemption Date, the greater of:

(a) 1.0% of the principal amount of such Note on such Redemption Date; and

(b) (i) in the case of any 2019 Note, the excess, if any, of (A) the present value at such Redemption Date of (x) the redemption price of such Note at June 15, 2015 (such redemption price being set forth in the table appearing above under —Optional Redemption), plus (y) all required remaining interest payments due on such Note through June 15, 2015 (excluding accrued but unpaid interest to the Redemption Date), computed using a discount rate equal to the Treasury Rate as of such Redemption Date plus 50 basis points; over (B) the principal amount of such Note on such Redemption Date, and

(ii) in the case of any 2021 Note, the excess, if any, of (A) the present value at such Redemption Date of (x) the redemption price of such Note at June 15, 2016 (such redemption price being set forth in the table appearing above under —Optional Redemption), plus (y) all required remaining interest payments due on such Note through June 15, 2016 (excluding accrued but unpaid interest to the Redemption Date), computed using a discount rate equal to the Treasury Rate as of such Redemption Date plus 50 basis points; over (B) the principal amount of such Note on such Redemption Date.

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“Asset Sale” means:

(1) the sale, conveyance, transfer or other disposition, whether in a single transaction or a series of related transactions, of property or assets (including by way of a Sale and Lease-Back Transaction) of the Company or any of its Restricted Subsidiaries (each referred to in this definition and in the covenant under —Repurchase at the Option of Holders —Asset Sales as a “disposition”); or

(2) the issuance or sale of Equity Interests of any Restricted Subsidiary, whether in a single transaction or a series of related transactions;

in each case, other than:

(a) any disposition of Cash Equivalents or Investment Grade Securities, in each case without giving effect to any limitations with regard to the currencies specified in such definitions;

(b) any disposition of obsolete or worn out property or assets or assets at the end of their useful lives in the ordinary course of business, including leases with respect to facilities that are temporarily not in use or pending their disposition;

(c) any disposition of inventory or goods (or other assets) held for sale or no longer used or useful in the operation of the business;

(d) (i) the disposition of all or substantially all of the assets of the Company in a manner permitted pursuant to the provisions described above under —Certain Covenants in the Indenture —Merger, Consolidation or Sale of All or Substantially All Assets or (ii) any disposition that constitutes a Change of Control pursuant to the Indenture;

(e) the making of any Restricted Payment that is permitted to be made, and is made, under the covenant described above under —Certain Covenants in the Indenture —Limitation on Restricted Payments;

(f) any disposition of property or assets or issuance or sale of Equity Interests of any Restricted Subsidiary in any transaction or series of related transactions with an aggregate fair market value of less than $150.0 million;

(g) any disposition of property or assets of the Company or any Restricted Subsidiary or issuance of securities by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to another Restricted Subsidiary;

(h) any disposition of property or assets of the Company or any Restricted Subsidiary to any joint venture in which the Company or any Restricted Subsidiary has an Equity Interest;provided, however, that the aggregate fair market value of all dispositions made pursuant to this clause (h) shall not exceed $750.0 million;

(i) to the extent allowable under Section 1031 of the Code, any exchange of like property or assets (excluding any boot thereon) for use in a Similar Business;

(j) the sale, lease, assignment, sub-lease, license or sub-license or other disposition of any real or personal property in the ordinary course of business;

(k) any issuance or sale or other disposition of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary or any joint venture in accordance with the applicable joint venture agreement;

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(l) foreclosures, condemnation, expropriation or any similar action with respect to assets or the granting of Liens not prohibited by the Indenture;

(m) any financing transaction with respect to property built or acquired by the Company or any Restricted Subsidiary after the Issue Date, including Sale and Lease-Back Transactions permitted by the Indenture;

(n) sales of accounts receivable in connection with the collection, settlement or compromise thereof or of lease receivables in the ordinary course of business;

(o) sales or transfers of accounts receivable and related assets in factoring, receivables financing or similar transactions;

(p) any exchange of assets for assets (including a combination of assets and Cash Equivalents) related to a Similar Business of comparable or greater value or usefulness to the business of the Company and its Restricted Subsidiaries as a whole, as determined in good faith by the Company, which, in the case of an exchange of assets with a fair value in excess of $500.0 million, shall be determined in good faith by the Board of Directors;

(q) the abandonment of intellectual property rights in the ordinary course of business, which in the good faith determination of the Company are not material to the conduct of the business of the Company and its Restricted Subsidiaries taken as a whole;

(r) voluntary terminations or unwindings of any Hedging Obligations;

(s) the licensing or sub-licensing of intellectual property or other general intangibles in the ordinary course of business;

(t) the licensing of trade names for use in other industries;

(u) any surrender or waiver of contract rights or the settlement, release or surrender of contract rights or other litigation claims in the ordinary course of business; and

(v) the issuance of directors’ qualifying shares and shares issued to foreign nationals as required by applicable law.

“Attributable Debt” means, in respect of a Sale and Lease-Back Transaction, as at the time of determination, the present value (discounted at the interest rate borne by the Notes, compounded annually) of the total obligations of the lessee for rental payments during the remaining term of the lease included in such Sale and Lease-Back Transaction (including any period for which such lease has been extended);provided, however, that if such Sale and Lease-Back Transaction results in a Capitalized Lease Obligation, the amount of Indebtedness represented thereby will be determined in accordance with the definition of “Capitalized Lease Obligation”.

“ATVM Assets” means equipment and fixtures (as such terms are defined in the UCC as effect in the State of New York), improvements to real properties, and other property (whether tangible or intangible) that under the EISA, and the rules and regulations of the DOE, are eligible for financing under the ATVM Program.

“ATVM Program” means the DOE’s Advanced Technology Vehicles Manufacturing Incentive Program authorized by Section 136 of the EISA.

“Board of Directors” means the Board of Directors of the Company.

“Business Day” means each day which is not a Saturday, a Sunday or another day on which commercial banking institutions are authorized or obligated to be closed in the State of New York.

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“Capital Stock” means:

(1) in the case of a corporation, corporate stock or shares in the capital of such corporation;

(2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock;

(3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

(4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock.

“Capitalized Lease” means a lease required to be capitalized for financial reporting purposes in accordance with GAAP;provided, however, that take or pay obligations in supply arrangements shall be deemed not to be a Capitalized Lease for any purpose under the Indenture.

“Capitalized Lease Obligation” means, at any time of determination, the amount of the liability in respect of a Capitalized Lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the footnotes thereto) prepared in accordance with GAAP;provided, however, that any obligations of the Company and any Restricted Subsidiary that are not characterized as, or would not be of the type to be characterized as, Capitalized Leases under GAAP as of the Issue Date shall not be treated as Capitalized Lease Obligations for any purposes under the Indenture and shall be treated as operating leases for all purposes.

“Cash Equivalents” means:

(1) United States dollars;

(2) (a) Canadian dollars, pounds sterling, Swiss franc, Japanese yen, euro, or any national currency of any participating member state of the EMU; or

(b) in the case of the Company or a Restricted Subsidiary, such currencies held by it from time to time in the ordinary course of business;

(3) securities issued or directly and fully and unconditionally guaranteed or insured by the U.S., Canadian, United Kingdom, Swiss or Japanese government or any country that is a member state of the EMU or any agency or instrumentality thereof in each case maturing not more than two years from the date of acquisition;

(4) certificates of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in each case with any commercial bank having capital and surplus of not less than $500.0 million in the case of U.S. banks and $250.0 million (or the U.S. dollar equivalent as of the date of determination) in the case of non-U.S. banks;

(5) repurchase obligations for underlying securities of the types described in clauses (3) and (4) entered into with any financial institution, or broker-dealer affiliate thereof, meeting the qualifications specified in clause (4) above;

(6) commercial paper rated at least P-1 by Moody’s or at least A-1 by S&P and in each case maturing within 24 months after the date of creation thereof;

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(7) marketable short-term money market and similar securities having a rating of at least P-2 or A-2 from either Moody’s or S&P, respectively (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another Rating Agency) and in each case maturing within 24 months after the date of creation thereof;

(8) readily marketable direct obligations issued by any state, commonwealth or territory of the United States or any political subdivision or taxing authority thereof having an Investment Grade Rating from either Moody’s or S&P with maturities of 24 months or less from the date of acquisition;

(9) Indebtedness or Preferred Stock issued by Persons with a rating of “A” or higher from S&P or “A2” or higher from Moody’s with maturities of 24 months or less from the date of acquisition;

(10) Investments with average maturities of 24 months or less from the date of acquisition in money market funds rated AAA- (or the equivalent thereof) or better by S&P or Aaa3 (or the equivalent thereof) or better by Moody’s;

(11) instruments equivalent to those referred to in clauses (1) to (10) above comparable in credit quality and tenor to any of those referred to above or denominated in any currency customarily used by corporations for operations or cash management purposes in any jurisdiction outside the United States to the extent reasonably related to any business conducted by the Company or any of its Restricted Subsidiaries and not for speculative purposes; and

(12) investment funds investing at least 95% of their assets in securities of the types described in clauses (1) through (11) above.

Notwithstanding the foregoing, Cash Equivalents shall include amounts denominated in currencies other than those set forth in clauses (1) and (2) above;provided, however, that such amounts are converted into any currency listed in clauses (1) and (2) as promptly as practicable and in any event within thirty Business Days following the receipt of such amounts.

“Cash Management Obligations” means cash management obligations (including banking, cash management, automated clearinghouse, custody and other similar services and company paid credit cards) of the Company or any of its Subsidiaries that are owed to the administrative agent, the arrangers, any lender or any affiliate of the administrative agent, the arrangers or any lender under the Senior Credit Facilities and that are agreed by the Company and the relevant counterparty to be secured.

“Change of Control” means the occurrence of any of the following after the Issue Date:

(1) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Company and its Restricted Subsidiaries, taken as a whole, directly or indirectly, to any Person other than a Permitted Holder;

(2) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act, or any successor provision), other than Permitted Holders, shall become, or obtain rights (whether by means of warrants, options or otherwise) to become, in one or a series of related transactions, the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, or any successor provision), directly or indirectly, of more than 50% of the outstanding Voting Stock of the Company; or

(3) the Board of Directors shall cease to consist of a majority of Continuing Directors.

“Change of Control Event” means the occurrence of a Change of Control and a Rating Decline.

“Code” means the Internal Revenue Code of 1986, as amended, or any successor thereto.

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“Collateral” means all property subject or purported to be subject, from time to time, to a Lien under any Security Document.

“Consolidated Current Liabilities” means, as of the date of determination, the aggregate amount of liabilities of the Company and its consolidated Restricted Subsidiaries which may properly be classified as current liabilities (including taxes accrued as estimated), as reflected on the consolidated balance sheet of the Company and its consolidated Restricted Subsidiaries as of the most recently ended fiscal quarter for which internal financial statements are available, determined on a consolidated basis and otherwise determined in accordance with GAAP, after eliminating:

(1) all intercompany items between the Company and any Restricted Subsidiary; and

(2) all current maturities of long-term Indebtedness, all as determined in accordance with GAAP.

“Consolidated Interest Expense” means, with respect to any Person for any period, without duplication, the sum of:

(1) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, to the extent such expense was deducted (and not added back) in computing Consolidated Net Income (including (a) amortization of original issue discount resulting from the issuance of Indebtedness at less than par, (b) all commissions, discounts and other fees and charges owed with respect to letters of credit or bankers acceptances, (c) non-cash interest expense, (d) the interest component of Capitalized Lease Obligations, and (e) net payments, if any made (less net payments, if any, received), pursuant to interest rate Hedging Obligations with respect to Indebtedness); plus

(2) consolidated capitalized interest of such Person and its Restricted Subsidiaries for such period, whether paid or accrued; plus

(3) dividends accrued in respect of all Disqualified Stock of the Company and all Preferred Stock of any Restricted Subsidiary, in each case, held by Persons other than the Company or a Wholly Owned Subsidiary (other than dividends payable solely in Capital Stock (other than Disqualified Stock) of the Company);provided, however, that such dividends will be multiplied by a fraction of the numerator of which is one and the denominator of which is one minus the effective combined tax rate of the issuer of such Preferred Stock (expressed as a decimal) for such period (as estimated by the chief financial officer of the Company in good faith).

For purposes of this definition, interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate determined by the Company in good faith to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP.

“Consolidated Net Income” means, with respect to any Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, and otherwise determined in accordance with GAAP;provided, however,that, without duplication,

(1) any net after-tax effect of extraordinary, non-recurring or unusual gains or losses shall be excluded,

(2) the cumulative effect of a change in accounting principles during such period shall be excluded,

(3) any net after-tax effect of income (loss) from disposed or discontinued operations to the extent included in discontinued operations prior to consummation of the disposition thereof) and any net after-tax gains or losses on disposal of disposed, abandoned or discontinued operations shall be excluded,

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(4) any net after-tax effect of gains or losses (less all fees and expenses relating thereto) attributable to asset dispositions other than in the ordinary course of business, as determined in good faith by the Company, shall be excluded, and

(5) the Net Income for such period of any Person that is not a Subsidiary, or is an Unrestricted Subsidiary, or that is accounted for by the equity method of accounting, shall be excluded;provided,however, that Consolidated Net Income of such Person shall be increased by the amount of dividends or distributions or other payments that are actually paid in Cash Equivalents (or to the extent converted into Cash Equivalents) to such Person or a Subsidiary thereof that is the Company or a Restricted Subsidiary in respect of such period.

Notwithstanding the foregoing, for the purpose of the covenant described under —Certain Covenants in the Indenture —Limitation on Restricted Payments only (other than clause (3)(d) or (3)(e) of the first paragraph thereof), there shall be excluded from Consolidated Net Income any income arising from any sale of the stock of an Unrestricted Subsidiary or any distribution or dividend from an Unrestricted Subsidiary, only to the extent such amounts have increased the amount of Restricted Payments permitted under such covenant pursuant to clause (3)(d) or (3)(e) of the first paragraph thereof.

“Consolidated Net Tangible Assets” means, with respect to any Person at any date of determination, the total assets appearing on the most recent consolidated balance sheet of such Person and its Restricted Subsidiaries as at the end of the most recent fiscal quarter for which internal consolidated financial statements are available, determined in accordance with GAAP, less (a) all Consolidated Current Liabilities as shown on such balance sheet, (b) Investments in Unrestricted Subsidiaries that are consolidated on the consolidated balance sheet of such Person, and (c) Intangible Assets and liabilities relating thereto.

“Consolidated Secured Debt Ratio” means the ratio of (1) the aggregate principal amount of Secured Indebtedness as of the most recently ended fiscal quarter for which internal financial statements are available to (2) Modified EBITDA for the most recently ended four fiscal quarters for which internal financial statements are available immediately preceding the date of determination, in each case, with such pro forma adjustments to Secured Indebtedness and Modified EBITDA as would be required under the definition of “Fixed Charge Coverage Ratio” in performing a calculation thereof.

For purposes of determining the amount of Secured Indebtedness in the ratio above, the amount of Secured Indebtedness under any revolving credit facility as of the most recently ended fiscal quarter for which internal financial statements are available will be deemed to be the average daily balance thereunder for the most recently ended four fiscal quarters for which internal financial statements are available immediately preceding the date of determination (or, if such facility has been available for less than four fiscal quarters, the average daily balance for the longest of the most recently ended one, two or three fiscal quarters for which internal financial statements are available during which such facility was in place).

“Contingent Obligations” means, with respect to any Person, any obligation of such Person guaranteeing any leases, dividends or other obligations that do not constitute Indebtedness (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation of such Person, whether or not contingent,

(1) to purchase any such primary obligation or any property constituting direct or indirect security therefor,

(2) to advance or supply funds

(a) for the purchase or payment of any such primary obligation, or

(b) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, or

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(3) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.

“Continuing Directors” means (a) prior to the consummation of a Corporate Reorganization, the Board of Directors on the Issue Date, and each other director of the Company, if such other director is appointed by a member or by a majority of the then Continuing Directors pursuant to the LLC Operating Agreement, and (b) after the consummation of a Corporate Reorganization, the Board of Directors on the date of consummation of the Corporate Reorganization, and each other director of the Company, if (i) such other director is appointed by any shareholder pursuant to any shareholders agreement, or (ii) such other director’s nomination for election to the Board of Directors is recommended by a majority of the then Continuing Directors or by a Permitted Holder.

“Corporate Reorganization” means any transaction or series of transactions, including through merger or otherwise creation of a holding company, for the purpose of converting the Company from a limited liability company into a corporation.

“Credit Facilities” means, with respect to the Company or any of its Restricted Subsidiaries, one or more debt facilities, including the Senior Credit Facilities, or other financing arrangements (including commercial paper facilities or indentures) providing for revolving credit loans, term loans, letters of credit, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables) or other long-term indebtedness, including any notes, mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements or refundings thereof and any indentures or credit facilities or commercial paper facilities that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount permitted to be borrowed thereunder or alters the maturity thereof or adds Restricted Subsidiaries as additional borrowers or guarantors thereunder and whether by the same or any other agent, lender or group of lenders.

“Default”means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.

“Designated Preferred Stock” means Preferred Stock of the Company, a Restricted Subsidiary or any direct or indirect parent corporation of the Company (in each case other than Disqualified Stock) that is issued for cash (other than to the Company or a Restricted Subsidiary or an employee stock ownership plan or trust established by the Company or its Subsidiaries) and is so designated as Designated Preferred Stock, pursuant to an Officer’s Certificate executed by the principal financial officer of the Company, on the issuance date thereof, the cash proceeds of which are excluded from the calculation set forth in clause (3) of the first paragraph of the —Certain Covenants in the Indenture —Limitation on Restricted Payments covenant.

“Disqualified Stock” means, with respect to any Person, any Capital Stock of such Person which, by its terms, or by the terms of any security into which it is convertible or for which it is putable or exchangeable, or upon the happening of any event, matures or is mandatorily redeemable (other than solely as a result of a change of control or asset sale) pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof (other than solely as a result of a change of control or asset sale), in whole or in part, in each case prior to the date 91 days after the earlier of the maturity date of the Notes or the date the Notes are no longer outstanding;provided, however,that if such Capital Stock is issued to any plan for the benefit of employees of the Company or its Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Stock solely because it may be required to be repurchased in order to satisfy applicable statutory or regulatory obligations.

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“DOE Assets” means ATVM Assets (a) in respect of which costs have been incurred or payments have been made by the Company or its Subsidiaries after June 9, 2009, (b) that relate to projects approved by the United States Department of Energy (the “DOE”) or any successor agency and (i) financed by the DOE under the ATVM Program, or (c) can be specifically identified (by type of asset and by purchase order number, serial number or other information) by reference to records maintained by the Company from and after the closing of any Permitted DOE Facility.

“DOE Replacement Facility Event” means the good faith determination by the Company, after December 31, 2011, that it will not be able to obtain some or all of the $3.5 billion in financing pursuant to a Permitted DOE Facility on terms and conditions (including timing of and conditions precedent to advances) reasonably acceptable to it.

“Domestic Subsidiary” means any Subsidiary of the Company that is organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof.

“EISA” means Energy Independence and Security Act of 2007 (Public Law 110-140; 42 U.S.C. 17013), as such statute may be amended, supplemented, renewed or replaced.

“EMU” means economic and monetary union as contemplated in the Treaty on European Union.

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock, but excluding any debt security that is convertible into, or exchangeable for, Capital Stock.

“Equity Offering” means any sale for cash of (a) common stock or common membership interests of the Company or (b) Preferred Stock of the Company which by its terms is mandatorily convertible into common stock or common membership interests of the Company, is not mandatorily redeemable and dividends on which are not paid in cash, but rather accrue to the principal amount of such Preferred Stock (in each case, excluding Disqualified Stock), other than:

(1) public offerings with respect to the Company’s common stock registered on Form S-8; and

(2) issuances to any Subsidiary of the Company.

“euro” means the single currency of participating member states of the EMU.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

“Exchange Notes” means new notes of the Issuers issued in exchange for the Notes pursuant to, or as contemplated by, the Registration Rights Agreement.

“Excluded Contribution” means net cash proceeds, marketable securities or Qualified Proceeds received by or contributed to the Company from,

(1) contributions to its common equity capital, and

(2) the sale (other than to a Subsidiary of the Company or to any management equity plan or stock option plan or any other management or employee benefit plan or agreement of the Company) of Capital Stock (other than Disqualified Stock and Designated Preferred Stock) of the Company,

in each case designated by the Company as Excluded Contributions pursuant to an Officer’s Certificate on the date such capital contributions are made or the date such Equity Interests are sold, as the case may be, which are

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excluded from the calculation set forth in clauses (3)(b) and 3(c) of the first paragraph under —Certain Covenants in the Indenture —Limitation on Restricted Payments.

“Fiat Group” means Fiat S.p.A. and any of its controlled Affiliates (other than the Company and its Subsidiaries).

“First-Priority Collateral Agent” means Citibank, N.A., in its capacity as collateral agent under the First-Priority Collateral Agreement.

“First-Priority Collateral Agreement” means that certain Collateral Agreement entered into on May 24, 2011, among the Issuers, the guarantors party thereto, the First-Priority Collateral Agent and the Collateral Agent.

“First-Priority Lien Obligations” means (i) all Indebtedness of the Company and the Guarantors secured by a Lien that is prior to, or senior to, the Lien securing the Notes, (ii) all other Obligations (not constituting Indebtedness) of the Company and the Guarantors under the Credit Facilities, in each case, secured by a Lien thatis prior to, or senior to, the Lien securing the Notes and (iii) all other Obligations of the Company and the Guarantors in respect of Hedging Obligations or Obligations in respect of cash management services in connection with Indebtedness described in clause (i) or Obligations described in clause (ii).

“Fixed Charge Coverage Ratio” means, with respect to any Person for any period, the ratio of Modified EBITDA of such Person for such period to the Fixed Charges of such Person for such period. In the event that the Company or any of its Restricted Subsidiaries Incurs, repays, repurchases or redeems any Indebtedness (other than in the case ofrevolving credit borrowings or revolving advances in which case interest expense shall be computed based upon the average daily balance of such Indebtedness during the applicable period) or issues, repurchases or redeems Disqualified Stock or Preferred Stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the event for which the calculation of the Fixed Charge Coverage Ratio is made (the “Calculation Date”), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such Incurrence, repayment, repurchase or redemption of Indebtedness, or such issuance, repurchase or redemption of Disqualified Stock or Preferred Stock, as if the same had occurred at the beginning of the applicable four-quarter period.

For purposes of making the computation referred to above, Investments, acquisitions, dispositions, mergers, amalgamations, consolidations and discontinued operations (as determined in accordance with GAAP), in each case with respect to an operating unit of a business made (or committed to be made pursuant to a definitive agreement) during the four-quarter reference period or subsequent to such reference period and on or prior to or simultaneously with the Calculation Date, and other operational changes that the Company or any of its Restricted Subsidiaries has determined to make or made during the four-quarter reference period or subsequent to such reference period and on or prior to or simultaneously with the Calculation Date shall be calculated on apro formabasis as set forth below assuming that all such Investments, acquisitions, dispositions, mergers, amalgamations, consolidations and discontinued operations had occurred on the first day of the four-quarter reference period. If since the beginning of such period any Person that subsequently became a Restricted Subsidiary or was merged with or into the Company or any of its Restricted Subsidiaries since the beginning of such period shall have made any Investment, acquisition, disposition, merger, amalgamation, consolidation or discontinued operation, in each case with respect to an operating unit of a business, that would have required adjustment pursuant to this definition, then the Fixed Charge Coverage Ratio shall be calculated givingpro formaeffect thereto in the manner set forth below for such period as if such Investment, acquisition, disposition, merger, consolidation, discontinued operation or operational change had occurred at the beginning of the applicable four-quarter period.

For purposes of this definition, wheneverpro formaeffect is to be given to an Investment, acquisition, disposition, amalgamation, merger or consolidation and the amount of income or earnings relating thereto, thepro formacalculations shall be made in good faith by a responsible financial or accounting officer of the Company in accordance with Regulation S-X.

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“Fixed Charges” means, with respect to any Person for any period, the sum, without duplication, of:

(1) Consolidated Interest Expense of such Person and Restricted Subsidiaries for such period; plus

(2) all cash dividends or other distributions paid to any Person other than such Person or any such Subsidiary (excluding items eliminated in consolidation) on any series of Preferred Stock of the Company or a Restricted Subsidiary during such period; plus

(3) all cash dividends or other distributions paid to any Person other than such Person or any such Subsidiary (excluding items eliminated in consolidation) on any series of Disqualified Stock of the Company or a Restricted Subsidiary during such period.

“Foreign Subsidiary” means any Subsidiary that is not organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof, and any Restricted Subsidiary of such Foreign Subsidiary.

“GAAP” means generally accepted accounting principles in the United States as in effect on the Issue Date. At any time after adoption of IFRS by the Company for financial reporting purposes, the Company may elect to apply IFRS for all purposes of the Indenture, in lieu of GAAP, and, upon any such election (the date of such election, the “IFRS Election Date”), references herein to GAAP shall be construed to mean IFRS as in effect on the IFRS Election Date;provided, however, that (1) any such election once made shall be irrevocable (and shall only be made once), (2) all financial statements and reports required to be provided after such election pursuant to the Indenture shall be prepared on the basis of IFRS and (3) from and after such election, all ratios, computations and other determinations (A) based on GAAP contained in the Indenture shall be computed in conformity with IFRS and (B) in the Indenture that require the application of GAAP for periods that include fiscal quarters ended prior to the Company’s election to apply IFRS shall remain as previously calculated or determined in accordance with GAAP. The Company shall give notice of any election to the Holders of Notes not later than 15 days after such election. Solely making an election (without any other action) referred to in this definition will not be treated as an incurrence of Indebtedness.

“Governmental Authorities” means any federal, state, provincial, municipal, national, supranational or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity, officer or examiner exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with the United States of America, any State thereof or the District of Columbia or a foreign entity or government

“Government Securities” means securities that are:

(1) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged; or

(2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America,

which, in either case, are not callable or redeemable at the option of the issuers thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such Government Securities or a specific payment of principal of or interest on any such Government Securities held by such custodian for the account of the holder of such depository receipt;provided, however,that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal of or interest on the Government Securities evidenced by such depository receipt.

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“guarantee” means a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including letters of credit and reimbursement agreements in respect thereof), of all or any part of any Indebtedness or other obligations.

“Guarantee” means the guarantee by any Guarantor of the Issuers’ Obligations under the Indenture and the Notes.

“Guarantee Agreement” means a supplemental indenture, in a form satisfactory to the Trustee, pursuant to which a Guarantor guarantees the Issuers’ obligations with respect to the Notes on the terms provided for in the Indenture.

“Guarantor” means, each Person that Guarantees the Notes in accordance with the terms of the Indenture.

“Hedging Obligations” means, with respect to any Person, the obligations of such Person under any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, commodity swap agreement, commodity cap agreement, commodity collar agreement, foreign exchange contract, currency swap agreement, interest rate, currency or commodity options or any other similar agreement providing for the transfer or mitigation of interest rate, commodity or currency risks either generally or under specific contingencies. For purposes of determining the amount of any such Hedging Obligations, if any agreement relating to such obligations provides for netting of amounts payable by and to such Person thereunder or if any such agreement provides for the simultaneous payment of amounts by and to such Person, then in each such case, the amount of such obligations shall be the net amount so determined, plus any premium due upon default by such Person.

“Holder” means the Person in whose name a Note is registered on the registrar’s books.

“IFRS” means the International Financial Reporting Standards as issued by the International Accounting Standards Board as in effect on the IFRS Election Date.

“Incur” or “incur” means to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable for, contingently or otherwise. The term “Incurrence” when used as a noun shall have acorrelative meaning. Solely for purposes of determining compliance with the covenant described under —Certain Covenants in the Indenture —Liens:

(1) amortization of debt discount or the accretion of principal with respect to a non-interest bearing or other discount security;

(2) the payment of regularly scheduled interest in the form of additional Indebtedness of the same instrument; and

(3) the obligation to pay a premium in respect of Secured Indebtedness arising in connection with the issuance of a notice of redemption or the making of a mandatory offer to purchase such Secured Indebtedness

will not be deemed to be the Incurrence of Secured Indebtedness.

“Indebtedness” means, with respect to any Person, without duplication:

(1) any indebtedness (including principal and premium) of such Person, whether or not contingent:

(a) in respect of borrowed money, including any indebtedness evidenced by bonds, notes, debentures or similar instruments or letters of credit or bankers’ acceptances (or, without duplication, reimbursement agreements in respect thereof);

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(b) representing the balance deferred and unpaid of the purchase price of any property (including Capitalized Lease Obligations), except (i) any such balance that constitutes an obligation in respect of a commercial letter of credit, a trade payable or similar obligation to a trade creditor, in each case accrued in the ordinary course of business, (ii) liabilities accrued in the ordinary course of business and (iii) any earn-out obligations until such obligation becomes a liability on the balance sheet of such Person in accordance with GAAP; or

(c) representing any Hedging Obligations, as reduced by any amounts of cash collateral posted as margin with respect to such obligations;

if and to the extent that any of the foregoing Indebtedness (other than letters of credit (other than commercial letters of credit) and Hedging Obligations) would appear as a liability upon a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with GAAP;

(2) to the extent not otherwise included, any obligation by such Person to be liable for, or to pay, as obligor, guarantor or otherwise, on the obligations of the type referred to in clause (1) of a third Person (whether or not such items would appear upon the balance sheet of such obligor or guarantor), other than by endorsement of negotiable instruments for collection in the ordinary course of business; and

(3) to the extent not otherwise included, the obligations of the type referred to in clause (1) of a third Person secured by a Lien on any asset owned by such first Person, whether or not such Indebtedness is assumed by such first Person;

provided, however,that notwithstanding the foregoing, Indebtedness shall be deemed not to include Contingent Obligations incurred in the ordinary course of business.

Notwithstanding the foregoing, (i) Indebtedness shall not include any liability for Federal, state, local or other taxes owed or owing to any governmental entity or obligations of such Person with respect to performance and surety bonds and completion guarantees entered into in the ordinary course of business, and (ii) Indebtedness shall be calculated without giving effect to the effects of ASC § 815 and related interpretations to the extent such effects would otherwise increase or decrease an amount of Indebtedness for any purpose under the indenture as a result of accounting for any embedded derivatives created by the terms of such Indebtedness.

“Independent Advisor” means an accounting, appraiser, engineer investment banking firm, investment advisor or consultant of recognized standing that is, as determined in good faith by the Company, qualified to perform the task for which it has been engaged.

“Initial Purchasers” means Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co., Citigroup Global Markets Inc., MORGAN STANLEY & CO. LLC, Barclays Capital Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Banca IMI S.p.A., RBS Securities Inc. and UBS Securities LLC.

“Initial Unrestricted Subsidiaries” means Auburn Hills Mezzanine LLC, Auburn Hills Owner LLC, AC Austro Car Handelgesellschaft mbH & Co. OHG, Chrysler Group Taiwan Sales Ltd., Chrysler Jeep Ticaret S.A. and any MID.

“Intangible Assets” means, with respect to any Person at any date of determination, the value (net of any applicable reserves), as shown on or reflected in the most recent consolidated balance sheet of such Person and its Restricted Subsidiaries as at the end of the fiscal quarter for which internal consolidated financial statements are available determined in accordance with GAAP, of all trade names, trademarks, licenses, patents, copyrights, service marks, goodwill and other intangibles.

“Intercreditor Agent” means the administrative agent under the Senior Credit Facilities, and any successor thereto in such capacity.

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“Intercreditor Agreement” means the Intercreditor Agreement dated on or about the Issue Date, among the Collateral Agent, the First-Priority Collateral Agent, the Issuers and each other Guarantor named therein, as such agreement may be amended, restated, supplemented or otherwise modified from time to time.

“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency, in each case, with a stable or better outlook.

“Investment Grade Securities” means:

(1) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality thereof (other than Cash Equivalents);

(2) debt securities or debt instruments with an Investment Grade Rating, but excluding any debt securities or instruments constituting loans or advances among the Company and the Subsidiaries of the Company;

(3) investments in any fund that invests exclusively in investments of the type described in clauses (1) and (2) which fund may also hold immaterial amounts of cash pending investment or distribution; and

(4) corresponding instruments in countries other than the United States customarily utilized for high quality investments.

“Investments” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including guarantees), advances or capital contributions (excluding accounts receivable, trade credit, advances to customers and commission, travel and similar advances to directors, officers, employees and consultants, in each case made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities issued by any other Person and investments that are required by GAAP to be classified on the balance sheet (excluding the footnotes) of such Person in the same manner as the other investments included in this definition to the extent such transactions involve the transfer ofcash or other property. For purposes of the definition of “Unrestricted Subsidiary” and the covenant described under —Certain Covenants in the Indenture —Limitation on Restricted Payments:

(1) “Investments” shall include the portion (proportionate to the Company’s direct or indirect equity interest in such Subsidiary) of the fair value of the net assets of a Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary;provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Company or applicable Restricted Subsidiary shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary in an amount (if positive) equal to:

(a) the Company’s direct or indirect “Investment” in such Subsidiary at the time of such redesignation; less

(b) the portion (proportionate to the Company’s direct or indirect equity interest in such Subsidiary) of the fair value of the net assets of such Subsidiary at the time of such redesignation; and

(2) any property transferred to or from an Unrestricted Subsidiary shall be valued at its fair value at the time of such transfer, in each case as determined in good faith by the Company.

“Issue Date” means May 24, 2011.

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“Lien” means, with respect to any asset, any mortgage, lien (statutory or otherwise), pledge, hypothecation, charge, security interest, preference, priority or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction;provided , however,that in no event shall an operating lease be deemed to constitute a Lien.

“LLC Operating Agreement” means the Amended and Restated Limited Liability Company Operating Agreement of the Company, dated as of June 10, 2009, as amended August 7, 2009, January 29, 2010 and April 5, 2011, by and among the Company, the UAW Retiree Medical Benefits Trust (“VEBA”) and the VEBA Holdcos (as defined in the LLC Operating Agreement), Fiat North America LLC, The United States Department of the Treasury, and Canada CH Investment Corporation (formerly named 7169931 Canada, Inc.).

“Master Industrial Agreement” means the Master Industrial Agreement, dated as of June 10, 2009, by and among Fiat Group Automobiles S.p.A., Fiat Powertrain Technologies S.p.A, Fiat North America LLC and Chrysler Group LLC.

“Materials of Environmental Concern” means any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products or any hazardous or toxic substances, materials or wastes, defined or regulated as such in or under any Environmental Law, including asbestos, polychlorinated biphenyls, urea-formaldehyde insulation, asbestos, pollutants, contaminants, radioactive substances, and any other materials or substances of any kind, whether or not any such material or substance is defined as hazardous or toxic under any Environmental Law, that is regulated pursuant to, or would reasonably be expected to give rise to liability under, any Environmental Law.

“MID” means any Subsidiary of the Company whose sole business is operating an automobile dealership and which is commonly referred to as a marketing investment dealership.

“Modified EBITDA” means, with respect to any Person for any period, the Consolidated Net Income of such Person and its Restricted Subsidiaries for such period (without giving effect to the adjustments in clauses (1), (3) and (4) of such definition):

(1) increased (without duplication) by:

(a) income tax expense of such Person and such Restricted Subsidiaries paid or incurred during such period to the extent the same were deducted (and not added back) in computing Consolidated Net Income;plus

(b) net interest expense of such Person and such Restricted Subsidiaries, excluding interest expense related to financing activities associated with a vehicle lease portfolio the Company refers to as Gold Key Lease;plus

(c) depreciation and amortization expense for plant, property and equipment, amortization of intangibles and equipment on lease of such Person and such Restricted Subsidiaries for such period to the extent the same were deducted (and not added back) in computing Consolidated Net Income, excluding depreciation and amortization expense for vehicles held for lease;plus

(d) pension, other post-retirement benefit (OPEB) and other employee benefit costs (in each case other than current service costs) of such Person and such Restricted Subsidiaries to the extent the same were deducted (and not added back) in computing Consolidated Net Income;plus

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(e) restructuring expenses of such Person and such Restricted Subsidiaries to the extent the same were deducted (and not added back) in computing Consolidated Net Income;plus

(f) other financial expense of such Person and such Restricted Subsidiaries;plus

(g) other unusual and infrequent costs, charges and expenses of such Person and such Restricted Subsidiaries consistent in nature and scope with such Person’s past practice or customary practice in such Person’s industry;

(2) decreased by (without duplication) by:

(a) income tax benefits of such Person and such Restricted Subsidiaries;

(b) any non-cash gains increasing Consolidated Net Income of such Person and such Restricted Subsidiaries for such period, excluding any non-cash gains to the extent they represent the reversal of an accrual or reserve for a potential cash item that reduced Modified EBITDA in any prior period; and

(c) restructuring income of such Person and such Restricted Subsidiaries.

“Moody’s” means Moody’s Investors Service, Inc. and any successor to its rating agency business.

“Net Income” means, with respect to any Person for any period, the net income (loss) of such Person and its Subsidiaries that are Restricted Subsidiaries for that period, determined in accordance with GAAP and before any reduction in respect of Preferred Stock dividends.

“Net Proceeds” means the aggregate proceeds received by the Company or its Restricted Subsidiaries in Cash Equivalents in respect of any Asset Sale (including any payments received by way of purchase price adjustments, deferred payment of principal pursuant to a note or installment receivable or otherwise, but only as and when received, but excluding the assumption by the acquiring Person of Indebtedness relating to the disposed assets or other consideration received in any other non-cash form), net of the direct costs relating to such Asset Sale (including legal, accounting and investment banking fees and brokerage and sales commissions), and any relocation expenses Incurred as a result thereof, taxes paid or payable as a result thereof, payments made by way of purchase price adjustments, including in respect of working capital items, amounts required to be applied to the repayment of principal, premium (if any) and interest on Indebtedness required (other than pursuant to the second paragraph of the covenant described under—Repurchase at the Option of Holders —Asset Sales) to be paid as a result of such transaction (including to obtain any required consent therefor), and any deduction of appropriate amounts to be provided by the Company as a reserve in accordance with GAAP against any liabilities associated with the asset disposed of in such transaction and retained by the Company after such sale or other disposition thereof, including pension and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction.

“Non-Fiat Directors” means, with respect to any transaction, the disinterested members (within the meaning of Section 144 of the Delaware General Corporation Law with respect to a matter in which any member of the Fiat Group has an interest) of the Board of Directors or any duly constituted committee of the Board of Directors comprised only of such disinterested directors.

“Obligations” means any principal (including any accretion), interest (including any interest accruing on or subsequent to the filing of a petition in bankruptcy, reorganization or similar proceeding at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable state, federal or foreign law), premium, penalties, fees, indemnifications, reimbursements (including reimbursement obligations with respect to letters of credit and banker’s acceptances), damages and other liabilities, and guarantees of payment of such principal (including any accretion), interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities, payable under the documentation governing any Indebtedness.

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“Officer” means the Chairman of the Board, the Chief Executive Officer, the President, any Executive Vice President, Senior Vice President or Vice President, the Treasurer or any Assistant Treasurer, or the Secretary or any Assistant Secretary of the Company.

“Officer’s Certificate” means a certificate signed on behalf of the Company by an Officer of the Company who must be the principal executive officer, the principal financial officer or the principal accounting officer of the Company, that meets the requirements set forth in the Indenture.

“Opinion of Counsel” means a written opinion from legal counsel to the Company, who may be internal counsel of the Company.

“Pari Passu Lien Obligation” means any Obligations of the Company and the Guarantors (including any Additional Notes) that are equally and ratably secured with the Notes with respect to the Collateral and are designated by the Company as a Pari Passu Lien Obligation.

“Permitted DOE Facility” means a credit facility provided to the Company by the DOE or any successor agency under the ATVM Program authorized by section 136 of EISA;provided, however, that (x) such facility shall be secured only by DOE Assets and assets of the Company and the Domestic Subsidiaries securing the Senior Credit Facilities, and (y) the DOE shall have entered into an intercreditor agreement consistent with the provisions set forth herein and in form and substance reasonably satisfactory to the Administrative Agent and the Arrangers under the Senior Credit Facilities

“Permitted Holder” means the Fiat Group. Any person or group whose acquisition of assets or beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) constitutes a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of the covenant described under —Repurchase at the Option of Holders —Change of Control Event (or would result in a Change of Control Offer in the absence of the waiver of such requirement by Holders in accordance with the covenant described under —Repurchase at the Option of Holders —Change of Control Event) will thereafter constitute an additional Permitted Holder.

“Permitted Liens” means, with respect to any Person:

(1) pledges, deposits or security by such Person under workmen’s compensation laws, unemployment insurance, employers’ health tax and other social security laws or similar legislation (including in respect of deductibles, self-insured retention amounts and premiums and adjustments thereto), pension benefits (but not including any Lien in favor of the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA (or any successor)), or pledges or good faith deposits in connection with bids, tenders, sales, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or pledges or deposits to secure public or statutory obligations of such Person or pledges or deposits of cash or U.S. government bonds to secure surety, appeal, customs or performance bonds and similar obligations or letters of credit to which such Person is a party or account party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case incurred in the ordinary course of business;

(2) Liens imposed by law, such as carriers’, warehousemen’s, materialmen’s, repairmen’s and mechanics’, construction or other like Liens, in each case for sums not yet overdue for a period of more than 90 days or being contested in good faith by appropriate actions or other Liens arising out of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review if adequate reserves with respect thereto are maintained on the books of such Person in accordance with GAAP;

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(3) Liens for taxes, assessments, governmental charges and utility charges, in each case that are not yet subject to penalties for non-payment or that are being contested in good faith by appropriate proceedings;provided that adequate reserves with respect thereto are maintained on the books of the Company to the extent required by, and in conformity with, GAAP;

(4) Liens in favor of issuers of performance, surety, bid, indemnity, warranty, release, appeal or similar bonds or with respect to other regulatory requirements or letters of credit or bankers’ acceptances issued, and completion guarantees provided for, in each case, issued pursuant to the request of and for the account of such Person in the ordinary course of its business or consistent with past practice prior to the Issue Date;

(5) permits, servitudes, licenses, easements, rights-of-way, restrictions and other similar encumbrances imposed by applicable law or incurred in the ordinary course of business or minor imperfections in title to real property that do not in the aggregate materially interfere with the ordinary conduct of the business of the Company and its Subsidiaries taken as a whole, including the following: (i) zoning, entitlement, conservation restriction and other land use and environmental regulations by one or more Governmental Authorities which do not materially interfere with the present use of the material assets of the Company and its Subsidiaries, (ii) all covenants, conditions, restrictions, easements, encroachments, charges, rights-of-way and any similar matters of record set forth in any state, local or municipal franchise on title to material real property of the Company and its Subsidiaries which do not materially interfere with the present use of such property, and (iii) minor survey exceptions and matters as to real property of the Company and its Subsidiaries which would be disclosed by an accurate survey or inspection of such real property and do not materially impair the occupancy or current use of such real property;

(6) any Lien to secure Indebtedness (and the related First-Priority Lien Obligations) Incurred pursuant to any term loan facility under any Credit Facilities in an aggregate amount not to exceed $3.0 billion (such amount, the “Term Loan Basket Amount”);provided, however, that the Term Loan Basket Amount shall be reduced by the amount of any permanent repayments of principal on such term loan facility,provided further, however, that notwithstanding any such permanent repayments, the Term Loan Basket Amount shall not be reduced below $1.75 billion; andprovided further, however, that the Notes are secured on a junior priority basis with such Indebtedness on terms consistent with the terms of the Intercreditor Agreement (as in effect on the Issue Date);

(7) any Lien securing First-Priority Lien Obligations in an amount not to exceed $1.0 billion in the aggregate at any one time outstanding;provided, however, that the Notes are secured on a junior priority basis with such Indebtedness on terms consistent with the terms of the Intercreditor Agreement (as in effect on the Issue Date);

(8) (A) any Lien securing the Notes outstanding on the Issue Date, the Exchange Notes issued in exchange therefor and the Guarantees relating thereto; (B) any Lien securing Pari Passu Lien Obligations (including Additional Notes) in an amount not to exceed $500.0 million in the aggregate at any one time outstanding;provided, however, that the Notes are equally and ratably secured with such Pari Passu Lien Obligations and (C) any Lien securing Pari Passu Lien Obligations (including Additional Notes),provided, however, that at the time of Incurrence thereof and after giving pro forma effect thereto, the Consolidated Secured Debt Ratio would be no greater than 2.25 to 1.00;provided further, however, that the Notes are equally and ratably secured with such Pari Passu Lien Obligations;

(9) any Lien to secure Indebtedness (and the related First Priority Lien Obligations) Incurred pursuant to any revolving asset-based loan facility under any Credit Facility in an aggregate amount not to exceed $2.0 billion in the aggregate at any one time outstanding;

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(10) any Lien existing on the Issue Date (other than Liens specified in clauses (6), (7), (8) and (9) above);

(11) any Lien to secure Indebtedness Incurred prior to the DOE Replacement Facility Event pursuant to any Permitted DOE Facility in an aggregate principal amount not to exceed $3.5 billion, which amount shall be reduced by the amount of any permanent repayments of principal on such Permitted DOE Facility (such amount as reduced, the “DOE Facility Primary Basket Amount”) on (A) any DOE Assets and (B) any Collateral or other assets pledged to secure the Senior Credit Facilities (such Collateral and other assets, the “DOE Secondary Assets”);provided, however, that the Lien on the DOE Secondary Assets will be limited to Indebtedness Incurred pursuant to any Permitted DOE Facility in an aggregate principal amount equal to 50 percent of the principal amount of Indebtedness Incurred and then outstanding under such Permitted DOE Facility but not to exceed $1.75 billion (such $1.75 billion sublimit to be reduced by an amount equal to 50 percent of the amount of any permanent repayments of principal on such Permitted DOE Facility) (such $1.75 billion sublimit as reduced, the “DOE Facility Secondary Basket Amount”);provided that the Notes are secured on a junior priority basis pursuant to the Intercreditor Agreement;

(12) after a DOE Replacement Facility Event, any Lien on (A) assets of a type eligible to be financed by the DOE under the ATVM Program (the “DOE Replacement Assets”) to secure Indebtedness Incurred pursuant to any Credit Facility (the “Primary Replacement Facility”) in an aggregate principal amount not to exceed $3.5 billion, which amount shall be reduced by the amount of any permanent repayments of principal on such Primary Replacement Facility and by the amount of any Indebtedness outstanding on the date of the DOE Replacement Facility Event under the Permitted DOE Facility secured pursuant to clause (11) above (such amount as reduced, the “Primary Replacement Facility Basket Amount”), and (B) any DOE Secondary Assets to secure Indebtedness Incurred pursuant to the Primary Replacement Facility (limited to an aggregate principal amount equal to 50 percent of the principal amount of Indebtedness Incurred and then outstanding under such Primary Replacement Facility but not to exceed $1.75 billion (such $1.75 billion sublimit to be reduced by the DOE Facility Secondary Basket Amount in respect of any Indebtedness outstanding under the Permitted DOE Facility on the date of the DOE Replacement Facility Event and by an amount equal to 50 percent of the amount of any permanent repayments of principal on such Primary Replacement Facility) (such $1.75 billion sublimit as reduced, the “DOE Replacement Facility Secondary Basket Amount”);provided that the Notes are secured on a junior priority basis pursuant to the Intercreditor Agreement;

(13) Liens existing on property or shares of stock or other assets of a Person at the time such Person becomes a Subsidiary;provided, however, that such Liens are not created or incurred in connection with, or in contemplation of, such other Person becoming such a Subsidiary;provided further, however, that such Liens may not extend to any other property or other assets owned by the Company or any of its Restricted Subsidiaries;

(14) Liens existing on property or other assets at the time the Company or a Restricted Subsidiary acquired the property or such other assets, including any acquisition by means of an amalgamation, merger or consolidation with or into the Company or any of its Restricted Subsidiaries;provided, however, that such Liens are not created or incurred in connection with, or in contemplation of, such acquisition, amalgamation, merger or consolidation;provided further, however, that the Liens may not extend to any other property owned by the Company or any of its Restricted Subsidiaries;

(15) Liens securing obligations under Indebtedness or other obligations of the Company, the Co-Issuer or a Restricted Subsidiary owing to the Company, the Co-Issuer or a Guarantor;provided, however, that any Lien securing obligations under Indebtedness or other obligations of a Guarantor to the Company, the Co-Issuer or a Restricted Subsidiary must be junior in priority to the Liens in favor of such Guarantor’s Guarantee;

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(16) Liens securing Hedging Obligations or other Cash Management Obligations;

(17) Liens on specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances or letters of credit issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

(18) leases, licenses, subleases or sublicenses of assets (including real property and intellectual property) granted to others that do not in the aggregate materially interfere with the ordinary conduct of the business of the Company and its Subsidiaries taken as a whole and material licenses and sublicenses of intellectual property or other general intangibles in the ordinary course of business;

(19) Liens arising from UCC financing statement filings (or similar filings) regarding or otherwise arising under leases entered into by the Company or any of its Subsidiaries or in connection with sales of accounts, payment intangibles, chattel paper or instruments;

(20) Liens on equipment of the Company or any of its Restricted Subsidiaries granted in the ordinary course of business;

(21) Liens to secure any refinancing, refunding, extension, renewal or replacement (or successive refinancing, refunding, extensions, renewals or replacements) as a whole, or in part, of any Indebtedness secured by any Lien referred to in foregoing clauses (8)(A), (8)(C), (10), (11)(A), (11)(B), (12)(A), (12)(B), (13) and (14) above and clause (36) below;provided, however, that (a) such new Lien shall be limited to all or part of the same property that secured the original Lien (plus improvements on such property) and (b) the obligations under Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (i) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clauses (8)(A), (8)(C), (10), (11)(A), (11)(B), (12)(A), (12)(B), (13) and (14) above and clause (36) below at the time the original Lien became a Permitted Lien under the Indenture, and (ii) an amount necessary to pay premiums (including tender premiums), defeasance costs and fees and expenses in connection with such refinancing, refunding, extension, renewal or replacement; andprovided further, however, that any Lien Incurred pursuant to this clause (21) in respect of any Lien initially Incurred under clause (11)(A), clause (11)(B), clause (12)(A), clause (12)(B) or clause (36) shall be deemed to be outstanding under clause (11)(A), clause (11)(B), clause (12)(A), clause (12)(B) or clause (36), as applicable, for purposes of determining the amount available to be secured under such clause; andprovided further, however, that, after a DOE Replacement Facility Event, any Lien Incurred pursuant to this clause (21) as part of a refinancing of amounts initially Incurred under clause (11)(A) shall be deemed to be outstanding under clause (12)(A) and any Lien Incurred pursuant to this clause (21) initially Incurred under clause (11)(B) shall be deemed to be outstanding under clause (12)(B), in each case for purposes of determining the amount available to be secured under such clauses (12)(A) and (12)(B), as applicable;

(22) deposits made or other security provided in the ordinary course of business to secure liability to insurance carriers;

(23) Liens securing judgments for the payment of money not constituting an Event of Default under clause (8) under —Events of Default and Remedies so long as such Liens are adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment have not been finally terminated or the period within which such proceedings may be initiated has not expired;

(24) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods in the ordinary course of business;

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(25) Liens (i) of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items in the course of collection, (ii) attaching to commodity trading accounts or other commodity brokerage accounts incurred in the ordinary course of business, and (iii) in favor of banking institutions arising as a matter of law encumbering deposits (including the right of set-off) and which are within the general parameters customary in the banking industry;

(26) Liens and rights of setoff created in the ordinary course of business in favor of banks and other financial institutions over credit balances of any bank accounts held at such banks or financial institutions or over investment property held in a securities account, as the case may be, to implement employee/corporate credit card programs, to secure fees and charges in the ordinary course of business or returned items and charge backs in the ordinary course of business, facilitate the operation of cash pooling and/or interest set-off arrangements in respect of such bank accounts or securities accounts in the ordinary course of business;

(27) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale or purchase of goods entered into by the Company or any Restricted Subsidiary in the ordinary course of business;

(28) Liens on contract receivables of the Company or any Guarantor generated in respect of an identified line of vehicles manufactured by Chrysler de Mexico S.A. de C.V. securing a contemplated loan to be made to Chrysler de Mexico S.A. de C.V. in an aggregate principal amount not to exceed $500.0 million or its equivalent in Mexican pesos at any one time outstanding (the equivalent in Mexican pesos calculated using the foreign exchange rate applicable for each draw);

(29) Liens on vehicle leases or beneficial interests of any Subsidiary in such vehicle leases and related vehicles to secure Indebtedness Incurred under leasing or financing programs of the Company or any of its Subsidiaries;

(30) Liens on deposits of cash to secure payments by the Company or any of its Subsidiaries required pursuant to the terms of any financial services arrangements for dealers or retail customers, including any subvention agreements;

(31) Liens securing Indebtedness arising from industrial revenue, development bond or similar financings where the Company and/or any Subsidiary is both the lessee of the financial property and the holder of the bonds;

(32) servicing agreements, development agreements, site plan agreements and other agreements with Governmental Authorities pertaining to the use or development of any of the property and assets of the Company or any Subsidiaries consisting of real property, provided that the same are complied with in all material respects;

(33) any Lien consisting of rights reserved to or vested in any Governmental Authority by applicable law, statutory Liens incurred or pledges or deposits made in favor of a Governmental Authority to secure the performance of obligations of the Company or any of its Subsidiaries under any and all foreign, Federal, state, provincial, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of any Governmental Authority or other requirements of law (including common law) regulation, relating to or imposing liability or standards of conduct concerning protection of human health as it relates to any Materials of Environmental Concern, the environment or natural resources, as now or may at any time hereafter be in effect (“Environmental Laws”) to which any assets of the Company or any such Subsidiaries are subject;

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(34) Liens existing on the Issue Date securing Indebtedness under that certain Loan Agreement dated as of August 3, 2007, between Auburn Hills Owner LLC and Citigroup Global Markets Realty Corp., and any refinancing thereof that satisfies the conditions under the proviso to clause (21) of this definition;provided, however, that such Liens do not encumber any property (except substitutions, replacements or proceeds thereof) other than property that was financed by such Indebtedness outstanding on the Issue Date;

(35) Liens securing Indebtedness Incurred by a Foreign Subsidiary,provided, however, that such Liens do not extend to the property or assets of the Company or any Subsidiary of the Company other than a Foreign Subsidiary; and

(36) Liens securing Capitalized Lease Obligations in an amount not to exceed $175.0 million in the aggregate in any calendar year (with amounts unused at the end of any calendar year being permitted to be carried over for the next succeeding calendar year);provided however, that the aggregate amount of any Capitalized Lease Obligations secured by a Lien pursuant to this clause (36) shall not exceed $350.0 million in any calendar year.

For purposes of this definition, the term “Indebtedness” shall be deemed to include interest on and the costs in respect of such Indebtedness. For purposes of determining compliance with the covenant described under —Certain Covenants in the Indenture —Liens, (1) in the event that a Lien meets the criteria of more than one of the types of “Permitted Liens” described above, the Company, in its sole discretion, shall classify such Lien at the time of Incurrence and only be required to include the amount of Secured Indebtedness secured by such Lien and the type of such Lien in one of the above clauses and (2) the Company shall be entitled at the time of such Incurrence to divide and classify the amount of Secured Indebtedness secured by such Lien and the type of such Lien in more than one of the types of “Permitted Liens” described above.

“Person” means any natural person, corporation, limited partnership, general partnership, limited liability company, limited liability partnership, joint stock company, joint venture, association, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, and any Governmental Authority.

“Preferred Stock” means any Equity Interest with preferential rights of payment of dividends or upon liquidation, dissolution or winding up.

“Purchase Money Liens” means, with respect to any Person, Liens securing Indebtedness Incurred to finance the construction, purchase or lease of, or repairs, improvements or additions to, property, plant or equipment of such Person;provided, however, that such Liens may not extend to any other property owned by such Person or any of its Restricted Subsidiaries at the time the Lien is Incurred (other than assets and property affixed or appurtenant thereto), and the Indebtedness (other than any interest thereon) secured by such Lien may not be Incurred more than 270 days after the later of the acquisition, completion of construction, repair, improvement, addition or commencement of full operation of the property subject to the Lien.

“Qualified Proceeds” means assets that are used or useful in, or Capital Stock of any Person engaged in, a Similar Business;provided; however,that the fair market value of any such assets or Capital Stock shall be determined by the Company in good faith.

“Rating Agencies” means Moody’s and S&P or if Moody’s or S&P or both shall not make a rating on the Notes publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Company which shall be substituted for Moody’s or S&P or both, as the case may be.

“Rating Decline” means the occurrence on any date from and after the date of the public notice by the Company or another Person seeking to effect a Change of Control of an arrangement that, as determined in good faith by the Company, is expected to result in a Change of Control until the end of the 60 day period following public

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notice of the occurrence of a Change of Control or abandonment of the expected Change of Control transaction of a decline in the rating of the Notes by either Rating Agency by at least one notch in the gradation of the rating scale (e.g., + or – for S&P or 1, 2 and 3 for Moody’s) from such Rating Agency’s rating of the Notes.

“Registration Rights Agreement” means the Registration Rights Agreement with respect to the Notes, dated the Issue Date, among the Issuers, the Guarantors and the Initial Purchasers and any similar registration rights agreements with respect to any Additional Notes.

“Restricted Subsidiary” means, at any time, any direct or indirect Subsidiary of the Company (including the Co-Issuer and any Foreign Subsidiary) that is not then an Unrestricted Subsidiary;provided,however, that upon the occurrence of an Unrestricted Subsidiary ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included in the definition of “Restricted Subsidiary.”

“S&P” means Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and any successor to its rating agency business.

“Sale and Lease-Back Transaction” means any arrangement providing for the leasing by the Company or any of its Restricted Subsidiaries of any real or tangible personal property, which property has been or is to be sold or transferred by the Company or such Restricted Subsidiary to a third Person in contemplation of such leasing.

“Scheduled Maturity” means, when used with respect to any Indebtedness, the date specified in such Indebtedness as the date on which the principal of such Indebtedness is due and payable or the date on which such Indebtedness is required to be repurchased by the issuer thereof or borrower thereunder.

“SEC” means the U.S. Securities and Exchange Commission.

“Secured Indebtedness” means any Indebtedness of the Company or any of its Restricted Subsidiaries secured by a Lien.

“Secured Parties” means the Trustee, the Collateral Agent, the Holders of the Notes, the beneficiaries of each indemnification obligation undertaken by the Issuers or any Guarantor under any Security Document and the successors and assigns of each of the foregoing.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.

“Security Documents” means the security agreements, pledge agreements, collateral assignments, mortgages, Intercreditor Agreement, the other intercreditor agreements and related agreements, as amended, supplemented, restated, renewed, refunded, replaced, restructured, repaid, refinanced or otherwise modified from time to time, creating security interests in the Collateral as contemplated by the Indenture.

“Senior Credit Facilities” means the Credit Facilities under the Credit Agreement dated as of May 24, 2011, by and among the Company, certain of the Company’s Subsidiaries, the lenders referred to therein, Citibank, N.A., as administrative agent, and the other bookrunners, arrangers and agents named therein including any guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements, refundings or refinancings thereof and any indentures or credit facilities or commercial paper facilities with banks or other institutional lenders or investors that replace, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount borrowable thereunder or alters the maturity thereof.

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“Significant Party” means any Guarantor or Restricted Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Issue Date.

“Similar Business” means any business conducted or proposed to be conducted by the Company and its Subsidiaries taken as a whole on the Issue Date or any business that is similar, reasonably related, incidental or ancillary thereto.

“Stated Maturity” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

“Subordinated Indebtedness” means:

(1) any Indebtedness of the Company which is by its terms subordinated in right of payment to the Notes; and

(2) any Guarantor which is by its terms subordinated in right of payment to the Guarantee of such entity of the Notes.

“Subsidiary” means, with respect to any Person, a corporation, association, partnership, joint venture, limited liability company or other business entity (excluding charitable foundations) of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, directly, or indirectly through one or more intermediaries, or both, by such Person.

“Transactions” means (i) the issuance and sale of Notes on the Issue Date, (ii) the term loan borrowings under the credit agreement governing the Senior Credit Facilities on the Issue Date, (iii) Fiat’s purchase of additional membership interests in the Company pursuant to its Incremental Equity Call Option on the Issue Date, (iv) the repayment in full of obligations under the Company’s U.S. Treasury first lien credit facility and EDC credit facility and termination of outstanding lending commitments under those facilities on the Issue Date, and (v) the payment of fees, expenses and premiums related to each of the foregoing.

“Treasury Rate” means, as of any Redemption Date, the yield to maturity as of such Redemption Date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the Redemption Date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the Redemption Date to June 15, 2015, in the case of the 2019 Notes, and June 15, 2016 in the case of the 2021 Notes;provided, however,that if the period from the Redemption Date to June 15, 2015 or June 15, 2016, as applicable, is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended (15 U.S.C. §§ 77aaa-77bbbb).

“UCC” or “Uniform Commercial Code” means the Uniform Commercial Code as from time to time in effect in the State of New York;provided,however, that if perfection or the effect of perfection or non-perfection or the priority of the security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, such terms shall have the meanings given to such terms in the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority.

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“Unrestricted Subsidiary” means:

(1) any Subsidiary of the Company which at the time of determination is an Unrestricted Subsidiary (as designated by the Company, as provided below);

(2) any Subsidiary of an Unrestricted Subsidiary; and

(3) any MID, whether existing on the Issue Date or newly acquired or formed.

The Company may designate any Subsidiary of the Company other than the Co-Issuer (including any existing Subsidiary and any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Equity Interests or Indebtedness of, or owns or holds any Lien on,any property of, the Company or any Restricted Subsidiary of the Company (other than solely any Unrestricted Subsidiary of the Subsidiary to be so designated);provided, however,that

(1) any Unrestricted Subsidiary must be an entity of which the Equity Interests entitled to cast at least a majority of the votes that may be cast by all Equity Interests having ordinary voting power for the election of directors or Persons performing a similar function are owned, directly or indirectly, by the Company;

(2) such designation complies with the covenants described under —Certain Covenants in the Indenture —Limitation on Restricted Payments; and

(3) each of:

(a) the Subsidiary to be so designated; and

(b) its Subsidiaries has not at the time of designation, and does not thereafter, incur any Indebtedness pursuant to which the lender has a security interest in any assets of the Company or any Restricted Subsidiary.

The Company may designate any Unrestricted Subsidiary to be a Restricted Subsidiary;provided, however,that, immediately after giving effect to such designation, no Default shall have occurred and be continuing and such designation complies with the covenant described under —Certain Covenants in the Indenture —Liens treating all Secured Indebtedness of such Unrestricted Subsidiary as if it was incurred on the date of designation.

Any such designation by the Company shall be notified by the Company to the Trustee by promptly filing with the Trustee a copy of the resolution of the Board of Directors or any committee thereof giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the foregoing provisions.

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the board of directors of such Person.

“Weighted Average Life to Maturity” means, when applied to any Indebtedness, Disqualified Stock or Preferred Stock, as the case may be, at any date, the quotient obtained by dividing:

(1) the sum of the products of the number of years from the date of determination to the date of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Disqualified Stock or Preferred Stock multiplied by the amount of such payment; by

(2) the sum of all such payments.

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“Wholly Owned Subsidiary” of any Person means a Subsidiary of such Person, 100% of the outstanding Equity Interests of which (other than directors’ qualifying shares and shares issued to foreign nationals as required under applicable law) shall at the time be owned by such Person directly or through other Wholly Owned Subsidiaries of such Person.

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BOOK-ENTRY, DELIVERY AND FORM

The Notes initially will be represented by one or more notes in registered, global form without interest coupons, or the Global Notes. The Global Notes will be deposited upon issuance with the collateral agent as custodian for DTC in New York, New York, and registered in the name of DTC or its nominee, in each case, for credit to an account of a direct or indirect participant in DTC as described below.

Transfers of beneficial interests in the Global Notes will be subject to the applicable rules and procedures of DTC and its direct or indirect participants, which may change from time to time and has been obtained from sources that we believe to be reliable. Investors may hold their interests in Global Notes directly through DTC if they are DTC participants, or indirectly through organizations that are DTC participants.

Except as set forth below, the Global Notes may be transferred, in whole or in part, only to another nominee of DTC or to a successor of DTC or its nominee.

Depository Procedures

The following description of the operations and procedures of DTC is provided solely as a matter of convenience and has been obtained from sources that we believe to be reliable. These operations and procedures are solely within the control of DTC and are subject to changes by them. We take no responsibility for these operations and procedures and urge investors to contact the system or its participants directly to discuss these matters.

DTC has advised us that DTC is:

• a limited-purpose trust company organized under the laws of the State of New York;

• a “banking organization” within the meaning of the New York banking law;

• a member of the Federal Reserve System;

• a “clearing corporation” within the meaning of the New York Uniform Commercial Code; and

• a “clearing agency” registered pursuant to the provisions of Section l7A of the Exchange Act.

DTC was created to hold securities of its participants and to facilitate the clearance and settlement of securities transactions among its participants in securities through electronic book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. DTC’s participants include:

• securities brokers and dealers;

• banks;

• trust companies;

• clearing corporations; and

• certain other organizations.

Access to DTC’s book-entry system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, whether directly or indirectly.

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We expect that pursuant to the procedures established by DTC (1) upon the issuance of a Global Note, DTC will credit, on its book-entry registration and transfer system, the respective principal amount of the individual beneficial interests represented by such Global Note to the accounts of participants and (2) ownership of beneficial interests in a Global Note will be shown on, and the transfer of those ownership interests will be effected only through, records maintained by DTC (with respect to participants’ interests) and the participants (with respect to the owners of beneficial interests in such Global Note other than participants). Ownership of beneficial interests in a Global Note is limited to participants or persons that may hold interests through participants.

So long as DTC or its nominee is the registered holder and owner of the Global Notes, DTC or its nominee, as the case may be, will be considered the sole legal owner of the Notes represented by the Global Notes for all purposes under the indenture and the Notes issued thereunder. Except as set forth below, owners of beneficial interests in a Global Note will not be entitled to receive definitive Notes and will not be considered to be the owners or holders of any Notes under such Global Note. We understand that under existing industry practice, in the event an owner of a beneficial interest in a Global Note desires to take any action that DTC, as the holder of such Global Note, is entitled to take, DTC would authorize the participants to take the action, and that participants would authorize beneficial owners owning through the participants to take the action or would otherwise act upon the instructions of beneficial owners owning through them. No beneficial owner of an interest in a Global Note will be able to transfer the interest except in accordance with DTC’s applicable procedures, in addition to those provided for under the indenture.

We will make payments of the principal of, and interest on, the Notes represented by the Global Notes registered in the name of and held by DTC or its nominee to DTC or its nominee, as the case may be, as the registered owner and holder of the Global Notes.

We expect that DTC or its nominee, upon receipt of any payment of principal or interest on the Notes represented by a Global Note, will credit participants’ accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of such Global Note as shown on the records of DTC or its nominee. We also expect that payments by participants and indirect participants to owners of beneficial interests in a Global Note held through such participants will be governed by standing instructions and customary practices, as is now the case with securities held for accounts of customers registered in the names of nominees for these customers. The payments, however, will be the responsibility of the participants and indirect participants, and none of we, the trustee, the collateral agent, the registrar or the paying agent will have any responsibility or liability for:

• any aspect of the records relating to, or payments made on account of, beneficial ownership interests in a Global Note;

• maintaining, supervising or reviewing any records relating to the beneficial ownership interests;

• any other aspect of the relationship between DTC and its participants; or

• the relationship between the participants and indirect participants and the owners of beneficial interests in a Global Note.

Unless and until it is exchanged in whole or in part for definitive Notes, the Global Notes may not be transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC.

Participants in DTC will effect transfers with other participants in the ordinary way in accordance with DTC rules and will settle transfers in same-day funds. If a holder requires physical delivery of a definitive note for any reason, including to sell Notes to persons in jurisdictions which require physical delivery or to pledge Notes, the holder must transfer its interest in the applicable Global Note in accordance with the normal procedures of DTC and the procedures set forth in the indenture.

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We expect that DTC will take any action permitted to be taken by a holder of Notes (including the presentation of Notes for exchange as described below) only at the direction of one or more participants to whose accounts at the DTC interests in a Global Note are credited and only in respect of the portion of the aggregate principal amount of the Notes as to which the participant or participants has or have given direction. However, if there is an event of default under the Notes, DTC will exchange the Global Notes for definitive Notes, which it will distribute to its participants. Although we expect that DTC will agree to the foregoing procedures in order to facilitate transfers of interests in Global Notes among participants of DTC, DTC is under no obligation to perform or continue to perform these procedures, and these procedures may be discontinued at any time. None of we, the trustee, the collateral agent, the paying agent or the registrar have any responsibility for the performance by DTC or its participants or indirect participants of their obligations under the rules and procedures governing its operations.

Certificated Securities

A Global Note is exchangeable for certificated notes in fully registered form without interest coupons, or Certificated Securities, only in the following limited circumstances:

• DTC notifies us that it is unwilling or unable to continue as depositary for such Global Note or ceases to be a clearing agency registered under the Exchange Act and we do not appoint a successor depositary within 90 days, or

• there shall have occurred and be continuing an event of default with respect to the Notes under the indenture and DTC shall have requested the issuance of Certificated Securities.

The laws of some states require that certain persons take physical delivery in definitive form of securities that they own. Consequently, the ability to transfer the notes will be limited to such extent.

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REGISTRATION RIGHTS

We are making the exchange offers to comply with our obligations under the Registration Rights Agreement to register the exchange of the Notes for the old notes. In the Registration Rights Agreement, we also agreed under certain circumstances, described below, to file a shelf registration statement to register the resale of certain old notes and Notes. The following description is a summary of the material provisions of the Registration Rights Agreement. It does not restate that agreement in its entirety. We urge you to read the Registration Rights Agreement in its entirety because it, and not this description, defines your registration rights as holders of the old notes.

The Issuers and the Guarantors entered into a Registration Rights Agreement with the initial purchasers of the old notes on February 7, 2014, the original issue date. Pursuant to the Registration Rights Agreement, the Issuers and the Guarantors agreed to (x) file with the SEC, within 270 days of the original issue date, and (y) use reasonable efforts to cause to become effective, within 360 days of the original issue date, the exchange offer registration statement. The Issuers and the Guarantors also agreed upon effectiveness of the exchange registration statement to offer the holders of old notes that constitute “transfer restricted subsidiaries” who are able to make certain representations the opportunity to exchange their old notes for Notes in the exchange offers, and to keep the exchange offers open for at least 20 business days.

If (i) the Issuers and the Guarantors are not required to consummate the exchange offers because the exchange offers are not permitted by applicable law or SEC policy, (ii) for any reason an exchange offer is not consummated within 390 days after the original issue date or (iii) with respect to any holder of transfer restricted securities (A) such holder is prohibited by applicable law or SEC policy from participating in the exchange offers, or (B) such holder may not resell the exchange notes acquired by it in the exchange offers to the public without delivering a prospectus and that the prospectus contained in the exchange offer registration statement is not appropriate or available for such resales by such holder, or (C) such holder is a broker-dealer and holds old notes acquired directly from the Issuers or one of their affiliates, then, upon such holder’s request, the Issuers and the Guarantors shall cause to be filed a shelf registration statement pursuant to Rule 415 under the Securities Act, which may be an amendment to the exchange offer registration statement, no later than the 90th day after such filing obligation arises, but no earlier than the 390th day after the original issue date. The Issuers and the Guarantors have agreed to use their respective reasonable efforts to cause such shelf registration statement to become effective within 90 days of filing such shelf registration statement and to use their best efforts to keep that shelf registration statement effective until the earlier of (i) the date that is one year from the effective date of the shelf registration statement and (ii) the date on which all old notes covered by the shelf registration statement have been sold pursuant to the shelf registration statement.

The Issuers and the Guarantors agreed, in the event of such a shelf registration, to provide to each holder of the old notes copies of the shelf registration statement and its amendments or supplements thereto and the prospectus, notify each holder of old notes when the shelf registration statement has become effective and take certain other actions to facilitate the offering and disposition of the old notes. A holder of old notes that sells old notes under a shelf registration statement generally will be required to be named as a selling securityholder in the related prospectus and to deliver a prospectus to purchasers, will be subject to certain of the civil liability provisions under the Securities Act in connection with those sales and will be bound by the provisions of the Registration Rights Agreement that are applicable to such a holder (including certain indemnification obligations). The Company may suspend the effectiveness of the shelf registration statement for specified periods of time upon the occurrence of certain circumstances described in the Registration Rights Agreement.

The Issuers and the Guarantors agreed that if (i) the exchange offer registration statement or the shelf registration statement is not filed with the SEC on or prior to the date specified for such filing in the applicable registration statement, (ii) any of such registration statements is not declared effective by the SEC on or prior to the date specified for such effectiveness, or the Effectiveness Target Date in the applicable registration statement, (iii) the exchange offer for either series of old notes is not consummated within 30 business days of the Effectiveness

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Target Date with respect to the exchange offer registration statement or (iv) the exchange offer registration statement or the shelf registration statement is declared effective but thereafter ceases to be effective or usable, subject to certain exceptions, for its intended purpose without being succeeded immediately by a post-effective amendment to such registration statement that cures such failure and that is itself immediately declared effective (each such event referred to in clauses (i) through (iv) above, a Registration Default), then additional interest shall accrue on the principal amount of the affected old notes at a rate of 0.25% per annum for the first 90-day period immediately following such date. The amount of the additional interest will increase by an additional 0.25% per annum of the principal amount of such old notes with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum amount of additional interest for all Registration Defaults of 1.00% per annum of the principal amount of such old notes.

Immediately upon the cure of all Registration Defaults, the accrual of additional interest will cease.

Holders of old notes will be required to make certain representations to the Company (as described elsewhere in this prospectus) in order to participate in the exchange offers and will be required to deliver certain information to be used in connection with the shelf registration statement within the time periods set forth in the Registration Rights Agreement in order to have their old notes included in the shelf registration statement and benefit from the provisions regarding additional interest set forth above. By acquiring old notes, a holder will be deemed to have agreed to indemnify the Issuers and the Guarantors against certain losses arising out of information furnished by such holder in writing for inclusion in any registration statement. Holders of old notes will also be required to suspend their use of the prospectus included in the shelf registration statement under certain circumstances upon receipt of written notice to that effect from the Issuers.

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MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

This section describes the material U.S. federal income and estate tax consequences of the acquisition, ownership and disposition of the Notes by holders that will receive Notes pursuant to the exchange offers and that will hold the Notes as capital assets. This section is based on the Internal Revenue Code of 1986 (the “Code”), as amended, its legislative history, existing and proposed regulations under the Internal Revenue Code, published rulings and court decisions, all as currently in effect. These laws are subject to change, possibly on a retroactive basis.

This section does not consider the specific facts and circumstances that may be relevant to a particular holder and does not apply to you if you are a member of a class of holders subject to special rules, such as a dealer in securities, a trader in securities that elects to use a mark-to-market method of accounting for your securities holdings, a bank, a life insurance company, a tax-exempt organization, a person that owns Notes that are a hedge or that are hedged against interest rate risks, a person that owns Notes as part of a straddle or conversion transaction for tax purposes, a person that purchases or sells Notes as part of a wash sale for tax purposes, or a United States Holder (as defined below) whose functional currency for tax purposes is not the U.S. dollar. Furthermore, this summary does not address any state, local or foreign tax implications. Each investor should seek advice based on its particular circumstances from an independent tax advisor. If you purchased the old notes at a price other than the original issue price, the amortizable bond premium or market discount rules may apply to you. You should consult your tax advisor regarding this possibility.

PROSPECTIVE HOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS CONCERNING THE U.S. FEDERAL INCOME AND OTHER TAX CONSEQUENCES OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF THE NOTES BASED UPON THEIR PARTICULAR SITUATIONS INCLUDING ANY CONSEQUENCES ARISING UNDER APPLICABLE STATE, LOCAL AND FOREIGN TAX LAWS.

For purposes of this discussion, a “United States Holder” means a beneficial owner of a Note that, for U.S. federal income tax purposes, is (i) an individual who is a citizen or resident of the United States, (ii) a corporation or other entity taxable as a corporation for U.S. federal income tax purposes created or organized in or under the laws of the United States, any state thereof or the District of Columbia, (iii) an estate whose income is subject to U.S. federal income tax regardless of its source, or (iv) a trust if a United States court can exercise primary supervision over the trust’s administration and one or more United States persons are authorized to control all substantial decisions of the trust. For purposes of this discussion, a “Foreign Holder” is a beneficial owner of a Note that, for U.S. federal income tax purposes, is (i) a nonresident alien individual, (ii) a foreign corporation or (iii) an estate or trust that in either case is not subject to U.S. federal income tax on a net income basis on income or gain from a Note. If a partnership holds the Notes, the U.S. federal income tax treatment of a partner will generally depend on the status of the partner and the tax treatment of the partnership. A partner in a partnership holding the Notes should consult its tax advisor with regard to the U.S. federal income tax treatment of an investment in the Notes.

The Exchange Offers

The exchange of the old notes for the Notes pursuant to the terms set forth in this prospectus should not constitute a taxable exchange for U.S. federal income tax purposes. Consequently, a holder will not recognize gain or loss upon the exchange of the old notes for the Notes. For purposes of determining gain or loss upon the subsequent sale or exchange of the Notes, a holder’s basis in the Notes should be the same as such holder’s basis in the old notes exchanged, decreased by the amount of any amortizable bond premium applied to reduce interest on the Notes. A holder’s holding period for the Notes should include the holding period for the old notes exchanged. The issue price and other U.S. federal income tax characteristics of the Notes should be identical to the issue price and other U.S. federal income tax characteristics of the old notes exchanged.

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Additional Payments

If a Change of Control Event occurs, as that term is defined inDescription of the Notes —Certain Definitions and Conventions, holders of Notes will have the right, subject to certain conditions, to require us to repurchase their Notes at a purchase price equal to 101% of the aggregate principal amount of Notes repurchased plus accrued and unpaid interest, if any, to the date of repurchase. SeeDescription of the Notes —Repurchase at the Option of Holders —Change of Control Event. Our obligation to pay additional amounts on the Notes in excess of the accrued interest and principal may implicate the provisions of the Treasury regulations relating to “contingent payment debt instruments.” Under these regulations, however, one or more contingencies will not cause a debt instrument to be treated as a contingent payment debt instrument if, as of the issue date, all such contingencies, when considered in the aggregate, are “remote” or “incidental.” We believe that, when considered in the aggregate, all of the contingent payments described herein are remote and/or incidental. Accordingly, we intend to take the position that such contingent payments should not cause the Notes to be treated as contingent payment debt instruments. A holder may not take a contrary position unless it discloses such contrary position in the proper manner to the IRS. Prospective holders of the Notes should consult their own tax advisors with respect to the contingent payment described above. If the IRS takes the position that the contingent payment described above were not remote and/or incidental as of the date of issuance, the amount and timing of interest income a holder must include in taxable income may have to be redetermined and a holder could be required to treat as ordinary income, rather than capital gain, any gain recognized on a sale, exchange retirement or redemption of a Note. The remainder of this discussion assumes that the Notes will not be treated as contingent payment debt instruments.

United States Holders

Payments of Interest

A United States Holder will be taxed on any stated interest on a Note as ordinary income at the time the United States Holder receives the interest or when it accrues, depending on the United States Holder’s method of accounting for tax purposes.

Notes Purchased at a Premium

If a United States Holder purchased the old notes for an amount (excluding any amount attributable to pre-issuance accrued interest) in excess of its principal amount, the United States Holder may elect to treat the excess as amortizable bond premium. For this purpose, in determining the amount a United States Holder paid to acquire its old notes, amounts paid in respect of interest that accrued prior to the issuance of the old notes is disregarded. If a United States Holder makes this election, it will reduce the amount required to be included in income each year with respect to interest on its Note by the amount of amortizable bond premium allocable to that year, based on the Note’s yield to maturity. If a United States Holder makes an election to amortize bond premium, it will apply to all debt instruments, other than debt instruments the interest on which is excludible from gross income, that a United States Holder holds at the beginning of the first taxable year to which the election applies or that the United States Holder thereafter acquires, and the United States Holder may not revoke it without the consent of the IRS. If a United States Holder does not elect to amortize bond premium, the amount of bond premium will decrease the gain or increase the loss that would otherwise be recognized on such Holder’s disposition of such Note.

Sales and Other Taxable Dispositions

In general, upon the sale, exchange, retirement, redemption or other taxable disposition of a Note, a United States Holder will recognize capital gain or loss equal to the difference between the amount realized on such sale or other taxable disposition (not including any amount attributable to accrued but unpaid stated interest, which will be treated as a payment of interest for U.S. federal income tax purposes and therefore will be taxable as ordinary

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income to the extent not previously so taxed) and such United States Holder’s adjusted tax basis in the Note (the adjusted tax basis should be determined as described above under —The Exchange Offers). Such gain or loss generally will constitute long-term capital gain or loss if the Note was held by such United States Holder for more than one year and otherwise will be short-term capital gain or loss (the holding period of the Note should be determined as described above under —The Exchange Offers). Under current U.S. federal income tax law, net long-term capital gains of non-corporate United States Holders (including individuals) are eligible for taxation at preferential rates. The deductibility of capital losses is subject to limitations under the Code.

Medicare Tax

A United States Holder that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, is subject to a 3.8% tax on the lesser of (1) the United States Holder’s “net investment income” for the relevant taxable year and (2) the excess of the United States Holder’s modified adjusted gross income for the taxable year over a certain threshold (which in the case of individuals is between $125,000 and $250,000, depending on the individual’s circumstances). A Holder’s net investment income generally includes its interest income and its net gains from the disposition of Notes, unless such interest income or net gains are derived in the ordinary course of the conduct of a trade or business (other than a trade or business that consists of certain passive or trading activities). If you are a United States Holder that is an individual, estate or trust, you are urged to consult your tax advisors regarding the applicability of the Medicare tax to your income and gains in respect of your investment in the Notes.

Foreign Holders

Payments of Interest

Payments of interest on a Note by us or any paying agent to a Foreign Holder will not be subject to U.S. federal income tax or withholding tax, provided that:

• the interest income in respect of the Note is not effectively connected with the conduct by the Foreign Holder of a trade or business within the United States;

• the Foreign Holder does not own, actually or constructively, 10% or more of the total combined voting power of all classes of our shares entitled to vote;

• the Foreign Holder is not, for U.S. federal income tax purposes, a controlled foreign corporation (as defined in the Code) related, directly or indirectly, to us through stock ownership;

• the Foreign Holder is not a bank whose receipt of interest on the Note is described in Code Section 881(c)(3)(A); and

• the certification requirements under Code Section 871(h) or 881(c) and the Treasury regulations thereunder, as described generally below, are met.

For purposes of Code Sections 871(h) and 881(c) and the Treasury regulations thereunder, in order to obtain the exemption from U.S. federal income and withholding tax described above, either (1) the Foreign Holder must provide its name and address, and certify, under penalties of perjury, to us or our paying agent, as the case may be, that such Holder is not a United States person or (2) the Foreign Holder must hold its Notes through certain intermediaries and both the Foreign Holder and the relevant intermediary must satisfy the certification requirements of applicable Treasury regulations. A certificate described in this paragraph is generally effective only with respect to payments of interest made to the certifying Foreign Holder after issuance of the certificate in the calendar year of its issuance and the two immediately succeeding calendar years. Under Treasury regulations,

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the foregoing certification generally may be provided by a Foreign Holder on IRS Form W-8BEN (or other applicable W-8 form).

Payments of interest on a Note that do not satisfy all of the foregoing requirements generally will be subject to 30% U.S. federal withholding tax unless the Foreign Holder provides to us or our paying agent a properly executed IRS Form W-8BEN claiming an exemption from or reduction in withholding under the benefit of an applicable income tax treaty. However, if the interest income in respect of a Note is effectively connected with the conduct by the Foreign Holder of a U.S. trade or business (and, if a tax treaty applies, is attributable to a United States permanent establishment maintained by the Foreign Holder), then such interest income generally will be exempt from the withholding tax described above, and instead will be subject to U.S. federal income tax on a net income basis at the regular graduated tax rates applicable to United States Holders. A Foreign Holder must provide a duly executed IRS Form W-8ECI to us or our paying agent in order to avoid U.S. federal withholding tax in respect of effectively connected interest income. In certain circumstances, a Foreign Holder that is a corporation also may be subject to an additional “branch profits tax” (currently at a 30% rate or, if applicable, a lower treaty rate).

Sales and Other Taxable Dispositions

In general, a Foreign Holder of a Note will not be subject to U.S. federal income tax on any gain recognized on the sale, retirement, redemption or other taxable disposition of a Note unless:

• such Foreign Holder is a nonresident alien individual who is present in the United States for 183 or more days in the taxable year of disposition and certain other conditions are met; or

• the gain is effectively connected with the conduct by the Foreign Holder of a U.S. trade or business (and, if a tax treaty applies, is attributable to a United States permanent establishment or fixed base maintained by the Foreign Holder).

In certain circumstances, a Foreign Holder that is a corporation also may be subject to an additional “branch profits tax” (currently at a 30% rate or, if applicable, a lower treaty rate).

U.S. Federal Estate Tax Consequences

For purposes of the U.S. federal estate tax, the Notes will be treated as situated outside the United States and will not be includible in the gross estate of a holder or beneficial owner who is neither a citizen nor a resident of the United States at the time of death; provided that (i) such holder or beneficial owner did not at the time of death actually or constructively own 10% or more of the total combined voting power of all classes of our shares entitled to vote and (ii) at the time of death, payments with respect to such Notes would not have been effectively connected with the conduct by such holder or beneficial owner of a U.S. trade or business.

Backup Withholding and Information Reporting

Under current U.S. federal income tax law, a backup withholding tax at specified rates (currently 28%) and information reporting requirements apply to certain payments of principal and interest made to, and to the proceeds of a disposition (including a retirements or redemption) by, certain United States Holders of Notes. In the case of a noncorporate United States Holder, information reporting requirements will apply to payments of principal and interest made by us or our paying agent on a Note. Backup withholding tax will apply to a United States Holder who is subject to information reporting if:

• such United States Holder fails to furnish its Taxpayer Identification Number (“TIN”) (which, for an individual, is his or her Social Security Number) to the payor in the manner required;

• such United States Holder furnishes an incorrect TIN and the payor is so notified by the IRS;

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• the payor is notified by the IRS that such United States Holder has failed to properly report payments of interest or dividends; or

• under certain circumstances, such United States Holder fails to certify, under penalties of perjury, that it has furnished a correct TIN and has not been notified by the IRS that it is subject to backup withholding for failure to report interest or dividend payments.

Backup withholding and information reporting do not apply with respect to payments made to certain exempt recipients, including corporations (within the meaning of Code Section 7701(a)), tax-exempt organizations or qualified pension and profit-sharing trusts. United States Holders should consult their tax advisors regarding their qualification for exemption from backup withholding and information reporting, and the procedure for obtaining such an exemption if applicable.

We must report annually to the IRS and to each Foreign Holder the amount of interest paid on a Note and the amount of tax withheld with respect to those payments. Copies of the information returns reporting those interest payments and withholding may also be made available to the tax authorities in the country in which a Foreign Holder resides under the provisions of an applicable income tax treaty. Backup withholding will not apply to payments of principal or interest made by us or our paying agent on a Note (absent actual knowledge or reason to know that the Holder is actually a United States Holder) if such Foreign Holder has provided the required certification under penalties of perjury that it is not a United States person or has otherwise established an exemption. Backup withholding and information reporting may apply to the proceeds of the disposition (including a retirement or redemption) of a Note within the United States or conducted through certain U.S.-related financial intermediaries unless the certification requirements described under—Foreign Holders —Payments of Interest above are satisfied (and the payor does not have actual knowledge or reason to know that the Holder is actually a United States Holder) or the Holder has otherwise established an exemption. Foreign Holders of Notes should consult their tax advisors regarding the application of information reporting and backup withholding in their particular situations, the availability of an exemption therefrom, and the procedure for obtaining such an exemption, if available.

Backup withholding is not an additional tax. Any amounts withheld from a payment under the backup withholding rules will be allowed as a credit against a Holder’s U.S. federal income tax liability and may entitle such Holder to a refund, provided that certain required information is furnished to the IRS.

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PLAN OF DISTRIBUTION

Based on interpretations by the staff of the SEC set forth in no-action letters issued to third parties, including “Exxon Capital Holdings Corporation,” available May 13, 1988, “Morgan Stanley & Co. Incorporated,” available June 5, 1991, “Mary Kay Cosmetics, Inc.,” available June 5, 1991, and “Warnaco, Inc.,” available October 11, 1991, we believe that Notes issued in exchange for the old notes may be offered for resale, resold and otherwise transferred by holders so long as such holder is not (i) an affiliate of the Issuers, (ii) a broker-dealer who acquired old notes directly from the Issuers or their affiliate or (iii) a broker-dealer who acquired old notes as a result of market-making or other trading activities (other than directly from the Issuers or their affiliate). Offers, sales and transfers may be made without compliance with the registration and prospectus delivery provisions of the Securities Act, provided that such Notes are acquired in the ordinary course of such holders’ business, and such holders are not engaged in, and do not intend to engage in, and have no arrangement or understanding with any person to participate in, a distribution of such Notes and that participating broker-dealers receiving Notes in the exchange offers will be subject to a prospectus delivery requirement with respect to resales of such Notes. To date, the staff of the SEC has taken the position that participating broker-dealers may fulfill their prospectus delivery requirements with respect to transactions involving an exchange of securities such as the exchange pursuant to the exchange offers (other than a resale of an unsold allotment from the sale of the old notes to the initial purchasers) with the prospectus contained in the registration statement relating to the exchange offers. Pursuant to the Registration Rights Agreement, the Issuers and the Guarantors have agreed to permit participating broker-dealers and other persons, if any, subject to similar prospectus delivery requirements to use this prospectus in connection with the resale of such Notes. The Issuers and the Guarantors have agreed that, for a period of up to 180 days after the effectiveness of the exchange offer registration statement, they will make this prospectus and any amendment or supplement to this prospectus available to any broker-dealer that requests such documents in the letter of transmittal for the exchange offers. Each holder of the old notes who wishes to exchange its old notes for Notes in the exchange offers will be required to make certain representations to us as set forth inThe Exchange Offers. In addition, each holder who is a broker-dealer and who receives Notes for its own account in exchange for the old notes that were acquired by it as a result of market-making activities or other trading activities will be required to acknowledge that it will deliver a prospectus in connection with any resale by it of such Notes.

We will not receive any proceeds from any sale of Notes by broker-dealers. Notes received by brokers-dealers for their own account pursuant to the exchange offers may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the Notes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or at negotiated prices. Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer and/or the purchasers of any such Notes. Any broker-dealer that resells Notes that were received by it for its own account pursuant to the exchange offers and any broker or dealer that participates in a distribution of such Notes may be deemed to be an “underwriter” within the meaning of the Securities Act and any profit on any such resale of Notes and any commissions or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal for the exchange offers states that by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

The Issuers and Guarantors will pay all reasonable and documented out-of-pocket expenses (other than commissions or concessions of any brokers or dealers) incident to their performance of or compliance with the Registration Rights Agreement, including SEC filing fees and the fees of counsel for the Issuers and the Guarantors and independent certified public accountants for the Issuers, as set forth in the Registration Rights Agreement. The Issuers and the Guarantors will indemnify holders of transfer restricted securities (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act, as set forth in the Registration Rights Agreement.

271

Following consummation of the exchange offers, we may, in our sole discretion, commence one or more additional exchange offers to holders of old notes who did not exchange their old notes for Notes in the exchange offers, on terms that may differ from those contained in the registration statement. This prospectus, as it may be amended or supplemented from time to time, may be used by us in connection with any such additional exchange offers. Such additional exchange offers will take place from time to time until all outstanding old notes have been exchanged for Notes pursuant to the terms and conditions herein.

272

VALIDITY OF THE NOTES

The validity of the Notes and the related guarantees will be passed upon on our behalf by Sullivan & Cromwell LLP, New York, New York.

EXPERTS

The consolidated financial statements and the related financial statement schedule of Chrysler Group LLC at December 31, 2013 and for the year ended December 31, 2013, appearing in this prospectus and registration statement have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their report thereon appearing elsewhere herein, and are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

The consolidated financial statements and the related financial statement schedule of Chrysler Group LLC and subsidiaries as of December 31, 2012 and for the years ended December 31, 2012 and 2011 appearing in this prospectus have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report, which is included herein. Such consolidated financial statements and financial statement schedule have been so included in reliance upon the report of such firm given their authority as experts in accounting and auditing.

273

WHERE YOU CAN FIND MORE INFORMATION

We have filed a registration statement on Form S-4 under the Securities Act with the Commission with respect to the issuance of the Notes. This prospectus, which is included in the registration statement, does not contain all of the information included in the registration statement. Certain parts of this registration statement are omitted in accordance with the rules and regulations of the SEC. For further information about us and the Notes, we refer you to the registration statement. You should be aware that the statements made in this prospectus as to the contents of any agreement or other document filed as an exhibit to the registration statement are not complete. Although we believe that we have summarized the material terms of these documents in the prospectus, these statements should be read along with the full and complete text of the related documents.

This prospectus contains summaries and other information that we believe are accurate as of the date hereof with respect to specific terms of specific documents, but we refer to the actual documents for complete information with respect to those documents. Statements contained in this prospectus as to the contents of any contract or other document referred to in this prospectus do not purport to be complete. Where reference is made to the particular provisions of a contract or other document, the provisions are qualified in all respects by reference to all of the provisions of the contract or other document. Industry and company data are approximate and reflect rounding in certain cases.

We are subject to the informational requirements of the Exchange Act and accordingly file reports and other information with the SEC. These reports and other information may be inspected and copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at (800) SEC-0330 for further information regarding the public reference room. In addition, our filings with the SEC are also available to the public on the SEC’s Internet Web Site athttp://www.sec.gov. We will also provide you, free of charge, with a copy of the Notes and the Secured Senior Notes Indenture. You may request a copy of these documents by contacting: Investor Relations, Chrysler Group LLC, 1000 Chrysler Drive, Auburn Hills, Michigan 48326.

274

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Pages
Reports of Independent Registered Public Accounting Firms	F-2
Report of Independent Registered Public Accounting Firm	F-3
Consolidated Statements of Income for the years ended December 31, 2013, 2012 and 2011	F-4
Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2013, 2012 and 2011	F-5
Consolidated Balance Sheets as of December 31, 2013 and 2012	F-6
Consolidated Statements of Cash Flows for the years ended December 31, 2013, 2012 and 2011	F-7
Consolidated Statements of Members’ Deficit for the years ended December 31, 2013, 2012 and 2011	F-9
Notes to Consolidated Financial Statements	F-10

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Members of

Chrysler Group LLC

We have audited the accompanying consolidated balance sheet of Chrysler Group LLC and subsidiaries as of December 31, 2013, and the related consolidated statements of income, comprehensive income (loss), members’ deficit, and cash flows for the year then ended. Our audit also included the financial statement schedule listed in the Index at Item 21(b)(2) for the information for the year ended December 31, 2013. These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Chrysler Group LLC and subsidiaries at December 31, 2013, and the consolidated results of their operations and their cash flows for the year ended December 31, 2013, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

/s/ Ernst & Young LLP

Detroit, Michigan

March 6, 2014

F-2

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Members of

Chrysler Group LLC

Auburn Hills, Michigan

We have audited the accompanying consolidated balance sheet of Chrysler Group LLC and subsidiaries (the “Company”) as of December 31, 2012, and the related consolidated statements of income, comprehensive income (loss), members’ deficit, and cash flows for the years ended December 31, 2012 and 2011. Our audits also included the financial statement schedule included in Item 21. These financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on the financial statements and financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Chrysler Group LLC and subsidiaries as of December 31, 2012, and the results of their operations and their cash flows for the years ended December 31, 2012 and 2011, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/ Deloitte & Touche LLP

Detroit, Michigan

March 7, 2013

(August 13, 2013 as to Note 23)

F-3

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In millions of dollars)

		Years Ended December 31,
	Notes	2013		2012		2011
Revenues, net		$	72,144	$	65,784	$	54,981
Cost of sales			61,398		55,350		46,422
GROSS MARGIN			10,746		10,434		8,559
Selling, administrative and other expenses			5,218		5,179		4,751
Research and development expenses, net	2		2,320		2,324		1,674
Restructuring (income) expenses, net	21		(14)		(61)		3
Interest expense	5		1,035		1,094		1,238
Interest income			(41)		(44)		(39)
Loss on extinguishment of debt	12		24		—		551
INCOME BEFORE INCOME TAXES			2,204		1,942		381
Income tax (benefit) expense	13		(553)		274		198
NET INCOME		$	2,757	$	1,668	$	183

See accompanying notes to consolidated financial statements.

F-4

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In millions of dollars)

		Years Ended December 31,
	Notes	2013		2012		2011
NET INCOME		$	2,757	$	1,668	$	183
Other comprehensive income (loss):
Derivatives, net (1)	3,16		149		(42)		38
Foreign currency translation adjustments (2)	3		84		(63)		18
Defined benefit plan adjustments, net (3)	3,18		3,041		(2,777)		(3,043)
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)			3,274		(2,882)		(2,987)
TOTAL COMPREHENSIVE INCOME (LOSS)		$	6,031	$	(1,214)	$	(2,804)

(1) Net of $1 million of income tax expense for the year ended December 31, 2013 and $0 taxes for the years ended December 31, 2012 and 2011, respectively.

(2) Net of $5 million of income tax expense for the year ended December 31, 2013 and $0 taxes for the years ended December 31, 2012 and 2011, respectively.

(3) Net of $177 million of income tax expense, $5 million of income tax benefit and $0 taxes for the years ended December 31, 2013, 2012 and 2011, respectively.

See accompanying notes to consolidated financial statements.

F-5

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions of dollars)

	Notes		December 31, 2013		December 31, 2012
CURRENT ASSETS:
Cash and cash equivalents			$	13,344	$	11,614
Restricted cash		14		8		28
Trade receivables, net of allowance for doubtful accounts of $54 and $56, respectively				1,161		1,179
Inventories		6		5,889		4,998
Prepaid expenses and other assets		10		1,647		1,108
Deferred taxes		13		484		23
TOTAL CURRENT ASSETS				22,533		18,950
PROPERTY AND EQUIPMENT:
Property, plant and equipment, net		7		16,071		15,491
Equipment and other assets on operating leases, net		8		1,391		976
TOTAL PROPERTY AND EQUIPMENT				17,462		16,467
OTHER ASSETS:
Advances to related parties and other financial assets				35		47
Restricted cash		14		325		343
Goodwill		9		1,361		1,361
Other intangible assets, net		9		3,375		3,360
Prepaid expenses and other assets		10		437		403
Deferred taxes		13		342		40
TOTAL OTHER ASSETS				5,875		5,554
TOTAL ASSETS			$	45,870	$	40,971
CURRENT LIABILITIES:
Trade liabilities			$	10,643	$	9,734
Accrued expenses and other liabilities		11		9,830		8,518
Current maturities of financial liabilities		12		491		456
Deferred revenue				1,298		862
Deferred taxes		13		43		71
TOTAL CURRENT LIABILITIES				22,305		19,641
LONG-TERM LIABILITIES:
Accrued expenses and other liabilities		11		11,760		15,537
Financial liabilities		12		11,810		12,147
Deferred revenue				1,100		822
Deferred taxes		13		137		83
TOTAL LONG-TERM LIABILITIES				24,807		28,589
Commitments and contingencies		14		—		—
MEMBERS’ DEFICIT:
Membership Interests
Class A Membership Interests — 1,632,654 and 1,061,225 units authorized, issued and outstanding at December 31, 2013 and 2012, respectively				—		—
Class B Membership Interests — None at December 31, 2013 and 200,000 units authorized, issued and outstanding at December 31, 2012				—		—
Contributed capital				2,633		2,647
Retained earnings (accumulated losses)				171		(2,586)
Accumulated other comprehensive loss		3		(4,046)		(7,320)
TOTAL MEMBERS’ DEFICIT				(1,242)		(7,259)
TOTAL LIABILITIES AND MEMBERS’ DEFICIT			$	45,870	$	40,971

See accompanying notes to consolidated financial statements.

F-6

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions of dollars)

			Years Ended December 31,
	Notes		2013		2012		2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income			$	2,757	$	1,668	$	183
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of property, plant and equipment and intangible assets				2,732		2,531		2,759
Depreciation of equipment and other assets on operating leases				209		170		117
Net amortization of favorable and unfavorable lease contracts				(16)		(36)		7
Release of valuation allowance on deferred tax assets		13		(962)		—		—
Changes in deferred taxes				29		—		(17)
Non-cash interest accretion, primarily related to debt discounts, debt issuance costs and fair value adjustments				117		122		179
Capitalized payable-in-kind interest		12, 19		—		—		17
Repayment of capitalized payable-in-kind interest		12		—		—		(395)
Venezuela foreign currency devaluation loss		22		78		—		—
Gain on settlement of Venezuela foreign currency transactions		22		(22)		—		—
Repayment of Canadian Health Care Trust Note capitalized interest		12		(69)		—		—
Repayment of VEBA Trust Note capitalized interest		12		(159)		—		—
Loss on extinguishment of debt		12		24		—		551
Call premium and other fees paid in connection with the Senior Credit Facilities amendments		12		(8)		—		—
Net loss on disposal of property, plant and equipment, equipment and other assets on operating leases and intangible assets				22		27		67
Non-cash adjustments to restructuring reserve estimates, net		21		(14)		(57)		(48)
Non-cash share-based compensation expense		17		68		71		36
Share-based compensation payments		17		(44)		(31)		(6)
Non-cash pension and OPEB expense, net				281		94		2
Pension and OPEB contributions		18		(756)		(443)		(579)
Payments associated with Canadian Health Care Trust settlement		18		—		—		(19)
Collection of Daimler pension receivable		18		—		—		200
Collection of Daimler tax receivable		13		—		—		374
Changes in accrued expenses and other liabilities				1,099		1,239		1,099
Changes in other operating assets and liabilities:
—inventories				(893)		(630)		(721)
—trade receivables				35		(334)		(46)
—trade liabilities				997		1,325		1,711
—other assets and liabilities				31		105		(868)
NET CASH PROVIDED BY OPERATING ACTIVITIES			$	5,536	$	5,821	$	4,603

See accompanying notes to consolidated financial statements.

F-7

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS —CONTINUED

(In millions of dollars)

		Years Ended December 31,
	Notes	2013		2012		2011
CASH FLOWS FROM OPERATING ACTIVITIES:
NET CASH PROVIDED BY OPERATING ACTIVITIES		$	5,536	$	5,821	$	4,603
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment and intangible assets			(3,434)		(3,633)		(3,009)
Proceeds from disposals of property, plant and equipment			8		9		35
Purchases of equipment and other assets on operating leases			(28)		(123)		(35)
Proceeds from disposals of equipment and other assets on operating leases			6		87		704
Change in restricted cash	14		38		90		215
Proceeds from the sale of certain international dealerships to Fiat, net	19		—		11		—
Change in loans and notes receivable			—		2		6
Proceeds from U.S. Dealer Automotive Receivables Transition LLC	14		—		—		96
Other			(3)		—		18
NET CASH USED IN INVESTING ACTIVITIES			(3,413)		(3,557)		(1,970)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of U.S. Treasury first lien credit facilities	12		—		—		(5,460)
Repayment of Export Development Canada credit facilities	12		—		—		(1,723)
Proceeds from Secured Senior Notes	12		—		—		3,160
Proceeds from Tranche B Term Loan	12		—		—		2,933
Repayments of Tranche B Term Loan	12		(30)		(30)		(15)
Repayment of Tranche B Term Loan in connection with amendments	12		(790)		—		—
Proceeds from Tranche B Term Loan in connection with amendments	12		790		—		—
Debt issuance costs	12		(30)		—		(72)
Proceeds from Mexican development banks credit facilities	12		—		—		217
Repayments of Mexican development banks credit facilities	12		(31)		(15)		—
Repayments of Gold Key Lease financing	12		—		(41)		(584)
Repayments of Canadian Health Care Trust Notes	12		(45)		(25)		(26)
Repayments of Auburn Hills Headquarters loan			(55)		(50)		(13)
Proceeds from Fiat’s incremental equity call option exercise	19		—		—		1,268
Net repayments of other financial obligations – related party			(4)		—		—
Net repayments of other financial obligations – third party			(87)		(84)		(81)
Distribution for state tax withholding obligations on behalf of members			(20)		(6)		(9)
NET CASH USED IN FINANCING ACTIVITIES			(302)		(251)		(405)
Effect of exchange rate changes on cash and cash equivalents			(91)		—		26
Net change in cash and cash equivalents			1,730		2,013		2,254
Cash and cash equivalents at beginning of period			11,614		9,601		7,347
Cash and cash equivalents at end of period		$	13,344	$	11,614	$	9,601
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Interest paid		$	(1,040)	$	(968)	$	(925)
Income tax payments, net			(245)		(224)		(81)
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Capitalized interest on VEBA Trust Note	12		—		38		126
Capitalized interest on Canadian Health Care Trust Notes	12		25		74		27

See accompanying notes to consolidated financial statements.

F-8

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

CONSOLIDATED STATEMENTS OF MEMBERS’ DEFICIT

(In millions of dollars)

	Notes		Contributed Capital		Retained Earnings (Accumulated Losses)		Accumulated Other Comprehensive Income (Loss)		Total
Balance at December 31, 2010			$	1,399	$	(4,437)	$	(1,451)	$	(4,489)
Exercise of Fiat’s incremental equity call option		19		1,268		—		—		1,268
Distribution for state tax withholding obligations on behalf of members				(10)		—		—		(10)
Net income				—		183		—		183
Total other comprehensive loss		3		—		—		(2,987)		(2,987)
Balance at December 31, 2011			$	2,657	$	(4,254)	$	(4,438)	$	(6,035)
Distribution for state tax withholding obligations on behalf of members				(10)		—		—		(10)
Net income				—		1,668		—		1,668
Total other comprehensive loss		3		—		—		(2,882)		(2,882)
Balance at December 31, 2012			$	2,647	$	(2,586)	$	(7,320)	$	(7,259)
Distribution for state tax withholding obligations on behalf of members				(14)		—		—		(14)
Net income				—		2,757		—		2,757
Total other comprehensive income		3		—		—		3,274		3,274
Balance at December 31, 2013			$	2,633	$	171	$	(4,046)	$	(1,242)

See accompanying notes to consolidated financial statements.

F-9

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 1. Background and Nature of Operations

Unless otherwise specified, the terms “we,” “us,” “our,” “Chrysler Group” and the “Company” refer to Chrysler Group LLC and its consolidated subsidiaries, or any one or more of them, as the context may require. “Fiat” refers to Fiat S.p.A., a corporation organized under the laws of Italy, its consolidated subsidiaries (excluding Chrysler Group) and entities it jointly controls, or any one or more of them, as the context may require.

Background

Chrysler Group was formed on April 28, 2009 as a Delaware limited liability company. On June 10, 2009, we completed the transaction contemplated by the master transaction agreement dated April 30, 2009, among the Company, Fiat and Old Carco LLC (“Old Carco”) and certain of its subsidiaries, which was approved under section 363 of the U.S. Bankruptcy Code (the “363 Transaction”). In connection with the closing of the 363 Transaction, we received capital contributions from the UAW Retiree Medical Benefits Trust (the “VEBA Trust”), Fiat, the United States Department of the Treasury (the “U.S. Treasury”) and Canada CH Investment Corporation, a 100 percent owned subsidiary of the Canada Development Investment Corporation, a Canadian federal Crown corporation (“Canadian Government”), in exchange for ownership interests in the Company.

As a result of a series of transactions during 2011 and 2012 that were contemplated in our governance documents and certain other agreements, our continuing members, as of December 31, 2013, were Fiat, which beneficially held a 58.5 percent ownership interest in us, and the VEBA Trust, which beneficially held the remaining 41.5 percent ownership interest in us. On January 21, 2014, Fiat completed a transaction in which its 100 percent owned indirect subsidiary Fiat North America LLC (“FNA”) indirectly acquired from the VEBA Trust all of the equity membership interests in Chrysler Group not previously held by FNA. Refer to Note 25,Subsequent Events, for additional information regarding Fiat’s acquisition of the remaining equity interests in Chrysler Group.

Nature of Operations

We design, engineer, manufacture, distribute and sell vehicles under the brand names Chrysler, Jeep, Dodge and Ram. As part of our industrial alliance with Fiat (the “Fiat-Chrysler Alliance”), we also manufacture certain Fiat-brand vehicles in Mexico, which are distributed by us throughout North America and select markets and sold to Fiat for distribution in other select markets. Our product lineup includes passenger cars, utility vehicles (which include sport utility vehicles and crossover vehicles), minivans, trucks, and commercial vans. We also sell automotive service parts and accessories under the Mopar brand name.

Our products are available in more than 150 countries around the world. We sell our products to dealers and distributors for sale to retail customers and fleet customers, which include rental car companies, commercial fleet customers, leasing companies and government entities. The majority of our operations, employees, independent dealers and sales are in North America, primarily in the U.S. Approximately 10 percent of our vehicle sales during 2012 and 2013 were outside North America, principally in Asia Pacific, South America and Europe. Vehicle, service parts and accessories sales outside North America are primarily through our 100 percent owned, affiliated or independent distributors and dealers. In June 2011, Fiat became the general distributor of our vehicles and service parts in Europe selling our products through a network of dealers. In addition, Fiat has taken on the distribution of our vehicles in certain markets outside of North America where its dealer networks are better established. We are the general distributor for Fiat vehicles in select markets outside of Europe. In addition, as part of the Fiat-Chrysler Alliance, Fiat manufactures certain Fiat-brand vehicles for us, which we sell in select markets. Refer to Note 19,Other Transactions with Related Parties, for additional information regarding the Fiat-Chrysler Alliance and other transactions with Fiat.

F-10

Note 2. Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Use of Estimates

The preparation of our consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include, but are not limited to, goodwill, long-lived asset and indefinite-lived intangible asset impairment analyses, recoverability of investments in equipment and other assets on operating leases, warranty obligations, product liability accruals, sales incentive obligations, restructuring accruals, valuation of derivative instruments, valuation of deferred tax assets, obligations related to income taxes, obligations related to employee benefits and the useful lives of property and equipment.

Actual results could differ from those estimates. Future changes in economic conditions may have a significant effect on such estimates made by management. Management believes the following significant accounting policies affect its more significant estimates, judgments and assumptions used in the preparation of our consolidated financial statements.

Consolidation and Financial Statement Presentation

The consolidated financial statements include the accounts of our subsidiaries, certain variable interest entities (“VIEs”) in which we are the primary beneficiary and other entities controlled by us. Related parties that are 20 percent to 50 percent owned and subsidiaries where control is expected to be temporary are accounted for under the equity method. All significant intercompany balances and transactions have been eliminated in consolidation.

We continually evaluate our involvement with VIEs to determine whether we have variable interests and are the primary beneficiary of the VIE. Based on our evaluation, we identified transactions with, or variable interests in, certain VIEs. The financial results of the VIEs in which we are the primary beneficiary are included in the accompanying consolidated financial statements in accordance with the accounting guidance for consolidations. Refer to Note 4,Variable Interest Entities, for additional information regarding our VIEs.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.

Recent Accounting Pronouncements

In July 2013, the Financial Accounting Standards Board (“FASB”) issued updated guidance requiring that certain unrecognized tax benefits be recognized as offsets against the corresponding deferred tax asset for a net operating loss carryforward, a similar tax loss or a tax credit carryforward, unless the deferred tax asset is not available or

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

F-11

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Recent Accounting Pronouncements —Continued

not intended to be used at the reporting date. This guidance is effective for fiscal periods beginning after December 15, 2013, and is to be applied prospectively to unrecognized tax benefits that exist at the effective date. We will comply with this guidance as of January 1, 2014 and it will not have a material impact on our consolidated financial statements as it is consistent with our present practice.

In July 2013, the FASB issued updated guidance to allow for the inclusion of the Federal Funds Effective Swap Rate as a benchmark interest rate for hedge accounting purposes. This guidance is effective prospectively for qualifying new or redesignated hedging relationships entered into on or after July 17, 2013. We adopted this guidance as of July 17, 2013, and it did not have a material impact on our consolidated financial statements.

In March 2013, the FASB issued updated guidance to clarify a parent company’s accounting for the release of the cumulative translation adjustment into income upon derecognition of certain subsidiaries or groups of assets within a foreign entity or of an investment in a foreign entity. This guidance is effective for fiscal periods beginning after December 15, 2013, and is to be applied prospectively to derecognition events occurring after the effective date. We will comply with this guidance as of January 1, 2014 and it will not have a material impact on our consolidated financial statements as it is consistent with our present practice.

In February 2013, the FASB issued updated guidance in relation to the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date. This guidance is effective for fiscal periods beginning after December 15, 2013, and is to be applied retrospectively for all periods presented for those obligations resulting from joint and several liability arrangements that exist at the beginning of the fiscal year of adoption. We will comply with this guidance as of January 1, 2014, and it will not have a material impact on our consolidated financial statements.

In February 2013, the FASB issued updated guidance that amends the reporting of amounts reclassified out of accumulated other comprehensive income (loss) (“AOCI”). These amendments do not change the current requirements for reporting net income or other comprehensive income in the financial statements. However, the guidance requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component, either on the face of the financial statement where net income is presented or in the notes to the financial statements. This guidance was effective for fiscal periods beginning after December 15, 2012, and was to be applied prospectively. We adopted this guidance as of January 1, 2013, and it did not have a material impact on our consolidated financial statements.

In October 2012, the FASB issued updated guidance on technical corrections and other revisions to various FASB codification topics. The guidance represents changes to clarify the codification, correct unintended application of the guidance or make minor improvements to the codification. The guidance also amends various codification topics to reflect the measurement and disclosure requirements of Accounting Standards Codification Topic 820,Fair Value Measurements and Disclosures. Certain amendments in this guidance were effective for fiscal periods beginning after December 15, 2012, while the remainder of the amendments were effective immediately. We previously adopted the guidance that was effective immediately and adopted the remainder of the guidance as of January 1, 2013, and it did not have a material impact on our consolidated financial statements.

In December 2011, the FASB issued updated guidance which amended the disclosure requirements regarding the nature of an entity’s rights of offset and related arrangements associated with its financial instruments and

F-12

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Recent Accounting Pronouncements —Continued

derivative instruments. Under the guidance, an entity must disclose both gross and net information about instruments and transactions eligible for offset in the statement of financial position and instruments and transactions subject to an agreement similar to a master netting arrangement. In January 2013, the FASB issued updated guidance which clarified that the 2011 amendment to the balance sheet offsetting standard does not cover transactions that are not considered part of the guidance for derivatives and hedge accounting. This guidance was effective for fiscal periods beginning on or after January 1, 2013. We adopted this guidance as of January 1, 2013, and it did not have a material impact on our consolidated financial statements.

Significant Accounting Policies

Revenue Recognition

Revenue for sales of vehicles and service parts is recognized when persuasive evidence of an arrangement exists, the risks and rewards of ownership have transferred to the customer, delivery has occurred or services have been rendered, the price of the transaction is fixed and determinable and collectability is reasonably assured. For vehicles, this is generally when the vehicle is released to the carrier responsible for transporting vehicles to dealers. Revenues are recognized net of discounts, including but not limited to, cash sales incentives, customer bonuses and rebates granted. Shipping and handling costs are recorded as cost of sales in the period incurred. Operating lease revenue is recognized over the contractual term of the lease on a straight-line basis.

We use price discounts to adjust vehicle pricing in response to a number of market and product factors, including: pricing actions and incentives offered by competitors, economic conditions, the amount of excess industry production capacity, the intensity of market competition, consumer demand for the product and the need to support promotional campaigns. We may offer a variety of sales incentive programs at any given point in time, including: cash offers to dealers and retail customers and subvention programs offered to retail customers or lease subsidies, which reduce the retail customer’s monthly lease payment or cash due at the inception of the financing arrangement, or both. Incentive programs are generally brand, model and region specific for a defined period of time, which may be extended.

We record the estimated cost of sales incentive programs offered to dealers and retail customers as a reduction to revenue at the time of sale to the dealer. This estimated cost represents the incentive programs offered to dealers and retail customers, as well as the expected modifications to these programs in order to facilitate sales of the dealer inventory. Subsequent adjustments to incentive programs related to vehicles previously sold to dealers are recognized as an adjustment to revenue in the period the adjustment is determinable. For the years ended December 31, 2013, 2012 and 2011, incentive expense was $9.9 billion, $8.8 billion and $7.2 billion, respectively, and is included as a reduction to Revenues, Net in the accompanying Consolidated Statements of Income.

Vehicle sales through our Guaranteed Depreciation Program (“GDP”), under which we guarantee the residual value or otherwise assume responsibility for the minimum resale value of the vehicle, are accounted for similar to an operating lease and rental income is recognized over the contractual term of the lease on a straight-line basis.

At the end of the lease term, we recognize revenue for the portion of the vehicle sales price which had not been previously recognized as rental income and recognize, in cost of sales, the remainder of the cost of the vehicle which had not been previously recognized as depreciation expense over the lease term. Cash flows associated

F-13

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Significant Accounting Policies —Continued

Revenue Recognition —Continued

with this program are included within Cash Flows from Operating Activities in the accompanying Consolidated Statements of Cash Flows.

We offer customers the opportunity to purchase separately-priced extended warranty and service contracts. In addition, from time to time we sell certain vehicles with a service contract included in the sales price of the vehicle. The service contract and vehicle qualified as separate units of accounting in accordance with the accounting guidance for multiple-element arrangements. The revenue from these contracts, as well as our separately-priced extended warranty and service contracts, is recorded as a component of Deferred Revenue in the accompanying Consolidated Balance Sheets at the inception of the contract and is recognized as revenue over the contract period in proportion to the costs expected to be incurred based on historical information. A loss on these contracts is recognized if the sum of the expected costs for services under the contract exceeds unearned revenue.

Cost of Sales

Cost of sales is composed of a number of expenses incurred in the manufacturing and distribution of vehicles and parts, the most significant of which is the cost of materials and components. The remaining costs principally include labor costs, consisting of direct and indirect wages and fringe benefits, as well as depreciation, amortization and transportation costs. Cost of sales also includes warranty and product-related costs, which are described below underProduct-Related Costs, along with depreciation expense related to our GDP vehicles.

Share-Based Compensation

We have various compensation plans that provide for the granting of share-based compensation to certain employees and directors. We account for share-based compensation plans in accordance with the accounting guidance set forth for share-based payments, which requires us to recognize share-based compensation expense based on fair value. Compensation expense for equity-classified awards is measured at the grant date based on the fair value of the award using a discounted cash flow methodology. For those awards with post-vesting contingencies, we apply an adjustment to account for the probability of meeting the contingencies. Liability-classified awards are remeasured to fair value at each balance sheet date until the award is settled. Compensation expense is recognized over the employee service period with an offsetting increase to contributed capital or accrued expenses and other liabilities depending on the nature of the award. If awards contain certain performance conditions in order to vest, we recognize the cost of the award when achievement of the performance condition is probable. Costs related to plans with graded vesting are generally recognized using the graded vesting method. We record share-based compensation expense in Selling, Administrative and Other Expenses in the accompanying Consolidated Statements of Income.

Product-Related Costs

Expenditures for research and development include material and personnel costs and are expensed as incurred. Research and development expenses, net were $2,320 million, $2,324 million and $1,674 million for the years ended December 31, 2013, 2012 and 2011, respectively. Advertising, sales promotion and other product-related costs are also expensed as incurred. For the years ended December 31, 2013, 2012 and 2011, advertising expense

F-14

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Significant Accounting Policies —Continued

Product-Related Costs —Continued

was $2,788 million, $2,742 million and $2,560 million, respectively, and is included in Selling, Administrative and Other Expenses in the accompanying Consolidated Statements of Income.

We periodically initiate voluntary service and recall actions to address various customer satisfaction, safety and emissions issues related to vehicles we sell. We establish reserves for product warranty obligations, including the estimated cost of these service and recall actions, when the related sale is recognized. Refer to Note 11,Accrued Expenses and Other Liabilities,for additional information related to warranty reserves. The estimated future costs of these actions are principally based on assumptions regarding the lifetime warranty costs of each vehicle line and each model year of that vehicle line, as well as historical claims experience for our vehicles. Estimates of the future costs of these actions are inevitably imprecise due to numerous uncertainties, including the enactment of new laws and regulations, the number of vehicles affected by a service or recall action and the nature of the corrective action that may result in adjustments to the established reserves. Costs associated with these actions are recorded in Cost of Sales in the accompanying Consolidated Statements of Income. We reserve for estimated product liability costs arising from personal injuries alleged to be the result of product defects. The valuation of the reserve is actuarially determined at least annually and when significant events occur or there are changes in circumstances. The valuation is based on, among other factors, the number of vehicles sold and product liability claims incurred. The product liability reserve is included in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets. Costs associated with this reserve are recorded in Cost of Sales in the accompanying Consolidated Statements of Income and any subsequent adjustments to the product liability reserve are recorded in the period in which the adjustment is determinable.

Restructuring Actions —Exit and Disposal Activities

We account for employee separation, exit and disposal activities in accordance with the relevant accounting guidance on these topics. Actions associated with restructuring plans include, but are not limited to, workforce reductions, capacity adjustments (plant or facility closures or permanent shift eliminations), product cancellations and international distribution network realignments. Costs associated with these actions may include, but are not limited to, employee severance, accelerated post-employment benefits, relocations, contract terminations, plant deactivations and legal claims.

Post-employment benefits accrued for workforce reductions related to restructuring activities are recorded in the period when it is probable that employees will be terminated, which generally occurs when a plan meets the following criteria and is communicated to employees: (i) management, having authority to approve the action, commits to a plan of termination, (ii) the plan identifies the number of employees to be terminated, their location and job classifications or functions, as well as the expected completion date, (iii) the plan establishes the terms of the benefit arrangement, including the benefits that employees will receive upon termination, in sufficient detail to enable employees to determine the type and amount of benefits they will receive if they are involuntarily terminated and (iv) the actions required to complete the plan indicate that it is unlikely that significant changes to the plan will occur or that the plan will be withdrawn.

Other associated costs such as relocations, contract terminations and plant deactivations are recorded when the costs are incurred. Costs associated with actions that will exceed one year are reflected on a discounted basis.

F-15

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Significant Accounting Policies —Continued

Restructuring Actions —Exit and Disposal Activities —Continued

Restructuring reserves are included in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets and are reviewed at least quarterly for adequacy and any necessary adjustments are recorded in the period the adjustment is determinable.

Income Taxes

We are a limited liability company classified as a partnership entity for U.S. federal income tax purposes. As such, we are not a taxable entity for U.S. federal income tax purposes. Rather, federal taxable income or loss is included in the respective federal income tax returns of our members. However, our provision for income taxes includes foreign taxes for our corporate subsidiaries, as well as for certain U.S. states which impose income taxes upon non-corporate legal entities.

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for net operating loss and tax credit carryforwards and the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and the respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances on deferred tax assets are recognized if it is more likely than not that the benefit from the deferred tax asset will not be realized. In addition, current income taxes include adjustments to accruals for uncertain tax positions and related interest expense or income. Refer to Note 13,Income Taxes, for additional information related to our accounting for income taxes.

Cash and Cash Equivalents

Highly liquid investments with original maturities of three months or less at the date of purchase are classified as cash equivalents.

Allowance for Doubtful Accounts

We maintain an allowance for doubtful accounts as a contra asset to our accounts receivable balances. A provision for probable losses is charged against selling, administrative and other expenses to maintain the allowance for doubtful accounts at an amount management believes represents the best estimate of probable losses related to specifically identified receivables, as well as probable losses inherent in all other receivables as of the balance sheet date. Management periodically and systematically evaluates the adequacy of the allowance for doubtful accounts by reviewing historical loss experience, delinquency statistics and other factors in the economy that are expected to have an impact on the losses incurred, in addition to specifically identified probable losses.

Inventories

Inventories are stated at the lower of cost or market. The cost for a substantial portion of finished product inventories was determined primarily on a specific identification basis. The cost of other inventories is

F-16

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Significant Accounting Policies —Continued

Inventories —Continued

determined on a first-in, first-out basis. The measurement of inventories includes the costs of materials, direct labor, inbound transportation and manufacturing costs.

Property, Plant and Equipment, Net and Equipment and Other Assets on Operating Leases, Net

Property, plant and equipment and equipment and other assets on operating leases are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are generally provided using the straight-line method over the estimated useful lives of the assets. Gains and losses upon disposal of leased vehicles and adjustments to reflect impairment of the vehicles’ residual values are also included in depreciation expense. Under the terms of certain of our GDP agreements, leased vehicles are repurchased by us prior to being sold at auction. Upon our repurchase, the leased vehicle is reclassified from equipment and other assets on operating leases, net to inventory at the lower of cost or estimated fair value. Routine maintenance costs are expensed as incurred.

Residual Values

We have significant investments in the residual values of our vehicle lease portfolios, which are included in Equipment and Other Assets on Operating Leases, Net in the accompanying Consolidated Balance Sheets. These residual values represent estimates of the fair value of the leased assets at the end of the contract terms and are initially recorded based on industry estimates. Realization of the residual values is dependent on our future ability to market the vehicles for sale under the prevailing market conditions. Throughout the lease term, residual values are reviewed at least quarterly to determine whether the estimates of the fair value of the assets at the end of the lease terms are appropriate. To the extent the expected value of the vehicle at lease termination changes, we record adjustments to the expected residual value. Changes in the expected residual values are adjusted through additional or reduced depreciation or recognition of an impairment loss. These costs are included in Cost of Sales in the accompanying Consolidated Statements of Income. These assumptions and related additional or reduced depreciation may change based on market conditions.

Impairment of Long-Lived Assets

Long-lived assets held and used (such as property, plant and equipment, and equipment and other assets on operating leases) are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability of an asset or asset group to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or group of assets. If the carrying amount of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset or group of assets exceeds the fair value of the asset or group of assets. No impairment indicators were identified during the years ended December 31, 2013, 2012 and 2011. As such, no impairment charges were recognized during the respective periods. When long-lived assets are considered held for sale, they are recorded at the lower of carrying amount or fair value less costs to sell, and depreciation ceases.

F-17

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Significant Accounting Policies —Continued

Goodwill and Other Intangible Assets

We account for goodwill in accordance with the accounting guidance related to intangibles and goodwill, which requires us to test goodwill for impairment at the reporting unit level at least annually and when significant events occur or there are changes in circumstances that indicate the fair value is less than the carrying amount. Such events could include, among others, a significant adverse change in the business climate, an unanticipated change in the competitive environment and a decision to change the operations of the Company. We have one operating segment, which is also our only reporting unit.

Goodwill is evaluated for impairment annually as of October 1. At our election, we can qualitatively assess whether it is more likely than not that the fair value of our reporting unit is less than its carrying value or we can perform a quantitative assessment by comparing the fair value of our reporting unit to its carrying amount, including goodwill, which is the first step of the two-step process described below. If we elect to perform the qualitative assessment and we conclude it is more likely than not that the fair value of the reporting unit is less than its carrying amount, quantitative impairment testing is required. However, if we conclude otherwise, quantitative impairment testing is not required.

When quantitative impairment testing is required as a result of the qualitative test or elected as the first assessment, goodwill is reviewed for impairment utilizing a two-step process. The first step of the impairment test is to compare the fair value of our reporting unit to its carrying value. The fair value is determined by estimating the present value of expected future cash flows for the reporting unit. If the fair value of the reporting unit is greater than its carrying amount, no impairment exists and the second step of the test is not performed. If the carrying amount of the reporting unit is greater than the fair value, there is an indication that impairment may exist and the second step of the test must be completed to measure the amount of the impairment. The second step of the test calculates the implied fair value of goodwill by assigning the fair value of the reporting unit to all of the assets and liabilities of that unit as if the reporting unit had been acquired in a business combination. The implied fair value of goodwill is then compared to the carrying value. If the implied fair value of goodwill is less than the carrying value, an impairment loss is recognized equal to the difference. No impairment losses have been recognized for the years ended December 31, 2013, 2012 and 2011.

Intangible assets that have a finite useful life are generally amortized over their respective estimated useful lives, on a straight-line basis. However, certain other finite-lived intangible assets are amortized in a manner that reflects the pattern in which the economic benefits of the intangible assets will be consumed. The estimated useful lives of the intangible assets are reviewed by management each reporting period and whenever changes in circumstances indicate that the carrying value of the assets may not be recoverable.

Other intangible assets determined to have an indefinite useful life are not amortized, but are instead tested for impairment annually. In July 2012, the FASB issued updated guidance on the annual testing of indefinite-lived intangible assets for impairment. The amendments allow an entity to first assess qualitative factors to determine whether it is more likely than not that the indefinite-lived intangible asset is impaired. At our election, we can qualitatively assess whether it is more likely than not that the fair value of our indefinite-lived intangible asset is less than its carrying value or we can perform a quantitative assessment by comparing the fair value of our indefinite-lived intangible asset to its carrying amount. If we elect to perform the qualitative assessment and we conclude it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if we conclude otherwise, quantitative impairment testing is not required. An impairment loss is recognized to the extent that the carrying amount

F-18

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Significant Accounting Policies —Continued

Goodwill and Other Intangible Assets —Continued

exceeds the asset’s fair value. Management estimates fair value through various techniques including discounted cash flow models, which incorporate market based inputs, and third party independent appraisals, as considered appropriate. Management also considers current and estimated economic trends and outlook. No impairment losses have been recognized for the years ended December 31, 2013, 2012 and 2011.

Foreign Currency

The functional currency of certain of our subsidiaries, notably Mexico and Venezuela, is the U.S. Dollar (“USD”). The functional currency of our other international operations, notably our Canadian subsidiaries and international distribution centers, is the respective subsidiary’s local currency. The assets and liabilities of our foreign operations, where the functional currency is the respective subsidiary’s local currency, are translated into USD using the exchange rate in effect as of the balance sheet date. Income statement amounts are translated at the average exchange rate prevailing during the period. The resulting translation adjustments are recorded as a component of AOCI. Refer to Note 3,Accumulated Other Comprehensive Income (Loss), for additional information on translation adjustments in AOCI.

Foreign currency exchange gains and losses arising from fluctuations in currency exchange rates on transactions and the effects of remeasurement of monetary balances denominated in currencies other than the functional currency are recorded in earnings as incurred and are included in Revenues, Net in the accompanying Consolidated Statements of Income. Refer to Note 22,Venezuelan Currency Regulations and Devaluation, for additional information related to the February 2013 currency devaluation in Venezuela.

The following summarizes net foreign currency transaction gains (losses) (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Net foreign currency transaction gains (losses)	$	(4)	$	(144)	$	91

Fair Value Measurements

The measurement of fair value is based on a three-tier hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows:

Level 1 —Quoted prices are available in active markets for identical assets or liabilities as of the balance sheet date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as cash and cash equivalents, restricted cash and marketable securities.

Level 2 —Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the balance sheet date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors and current market and contractual prices for the underlying instruments, as well as

F-19

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 2. Basis of Presentation and Significant Accounting Policies —Continued

Significant Accounting Policies —Continued

Fair Value Measurements —Continued

other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument and can be derived from observable data. Instruments in this category include commercial paper and non-exchange-traded derivatives such as over-the-counter currency and commodity forwards, swaps and option contracts.

Level 3 —Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At each balance sheet date, we perform an analysis of all instruments subject to fair value measurement and include in Level 3 all of those whose fair value is based on significant unobservable inputs. Instruments in this category include non-exchange traded derivatives such as over-the-counter commodity option and swap contracts.

Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy. Transfers into and out of fair value hierarchy levels are recognized as of the balance sheet date.

Refer to Note 15,Fair Value Measurements, for a detailed discussion of the use of observable and unobservable inputs. As part of the process of measuring the fair value of liabilities, we considered the non-performance risk related to that liability, which includes our credit risk. The effect of our credit risk on the fair value of the liability may differ depending on whether the liability is an obligation to deliver cash versus goods or services, as well as the terms of the credit enhancements related to the liability.

Note 3. Accumulated Other Comprehensive Income (Loss)

The changes in AOCI by component, including the amounts reclassified to income, were as follows (in millions of dollars):

	Year Ended December 31, 2013
	Defined Benefit Plan Adjustments				Derivatives
	Net Actuarial Loss		Net Prior Service Credit		Currency Forwards and Swaps		Commodity Swaps		Foreign Currency Translation Adjustments		Total
Balance at beginning of period	$	(7,232)	$	42	$	(40)	$	4	$	(94)	$	(7,320)
Gain (loss) recorded in other comprehensive income		3,035		(98)		230		7		89		3,263
Less: Gain (loss) reclassified from AOCI to income		(314) (1)		33 (1)		84 (2)		3 (3)		—		(194)
Tax effect		(173)		(4)		(1)		—		(5)		(183)
Other comprehensive income (loss)		3,176		(135)		145		4		84		3,274
Balance at end of period	$	(4,056)	$	(93)	$	105	$	8	$	(10)	$	(4,046)

F-20

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 3. Accumulated Other Comprehensive Income (Loss) —Continued

	Year Ended December 31, 2012
	Defined Benefit Plan Adjustments				Derivatives
	Net Actuarial Loss		Net Prior Service Credit		Currency Forwards and Swaps		Commodity Swaps		Foreign Currency Translation Adjustments		Total
Balance at beginning of period	$	(4,499)	$	86	$	57	$	(51)	$	(31)	$	(4,438)
Gain (loss) recorded in other comprehensive income		(2,865)		(4)		(103)		11		(63)		(3,024)
Less: Gain (loss) reclassified from AOCI to income		(127) (1)		40 (1)		(6) (2)		(44) (3)		—		(137)
Tax effect		5		—		—		—		—		5
Other comprehensive income (loss)		(2,733)		(44)		(97)		55		(63)		(2,882)
Balance at end of period	$	(7,232)	$	42	$	(40)	$	4	$	(94)	$	(7,320)

	Year Ended December 31, 2011
	Defined Benefit Plan Adjustments				Derivatives
	Net Actuarial Loss		Net Prior Service Credit		Currency Forwards and Swaps		Commodity Swaps		Foreign Currency Translation Adjustments		Total
Balance at beginning of period	$	(1,376)	$	6	$	(74)	$	42	$	(49)	$	(1,451)
Gain (loss) recorded in other comprehensive income		(3,136)		91		35		(62)		18		(3,054)
Less: Gain (loss) reclassified from AOCI to income		(13) (1)		11 (1)		(96) (2)		31 (3)		—		(67)
Tax effect		—		—		—  ��		—		—		—
Other comprehensive income (loss)		(3,123)		80		131		(93)		18		(2,987)
Balance at end of period	$	(4,499)	$	86	$	57	$	(51)	$	(31)	$	(4,438)

(1) These AOCI components are included within the computation of net periodic benefit costs. Refer toNote 18, Employee Retirement and Other Benefits, for additional information.

(2) Amount reclassified to Revenues, Net in the accompanying Consolidated Statements of Income. Refer toNote 16, Derivative Financial Instruments and Risk Management, for additional information.

(3) Amount reclassified to Cost of Sales in the accompanying Consolidated Statements of Income. Refer toNote 16, Derivative Financial Instruments and Risk Management, for additional information.

F-21

Note 4. Variable Interest Entities

Nonconsolidated VIEs

ZF Marysville, LLC

We have a commercial agreement with ZF Marysville, LLC (“ZFM”) in which ZFM produces lightweight axles at one of our facilities. ZFM was determined to be a VIE as it does not have sufficient equity at risk to finance its activities. We hold no equity interests in ZFM and we do not have the power to direct the activities of ZFM which most significantly affect its economic performance. Therefore, we have determined we are not the primary beneficiary of ZFM.

ZFM began production in July 2010. Upon the start of operations, we recorded capital lease assets and capital lease obligations resulting from an embedded capital lease related to the equipment used to produce the lightweight axles. In July 2011, a second embedded capital lease was recorded related to equipment used to produce axle components. As of December 31, 2013 and 2012, we had $93 million and $108 million, respectively, of capital lease assets and $102 million and $115 million, respectively, of capital lease obligations, which are included in Property, Plant and Equipment, Net and Financial Liabilities, respectively, in the accompanying Consolidated Balance Sheets. Our maximum exposure to loss is approximately $12 million through our contractual commitments to ZFM through 2020.

Refer to Note 12,Financial Liabilitiesand Note 14, Commitments, Contingencies and Concentrations, for additional information on transactions with VIEs.

Note 5. Interest Expense

Interest expense included the following (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Financial interest expense:
Related parties (see Note 19)	$	441	$	440	$	635
Other		603		651		506
Interest accretion, primarily related to debt discounts, debt issuance costs and fair value adjustments		117		119		170
Payable-in-kind interest —related party (see Note 12)		—		—		27
Capitalized interest related to capital expenditures		(126)		(116)		(100)
Total	$	1,035	$	1,094	$	1,238

Related party amounts above include activities with the U.S. Treasury through July 21, 2011. Refer to Note 19,Other Transactions with Related Parties,for additional information.

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

F-22

Note 6. Inventories

The components of inventories as of December 31 were as follows (in millions of dollars):

	2013		2012
Finished products, including service parts	$	3,830	$	3,255
Work in process		1,846		1,560
Raw materials and manufacturing supplies		213		183
Total	$	5,889	$	4,998

Note 7. Property, Plant and Equipment, Net

The components of property, plant and equipment as of December 31 were as follows (in millions of dollars):

	Range of Useful Lives (years)	2013		2012
Land	-	$	247	$	257
Leasehold improvements and buildings	12 - 40		3,385		2,929
Technical equipment and machinery	3 - 30		10,348		8,103
Factory, office and other equipment	3 - 19		1,849		1,640
Special tooling	3 - 12		8,974		7,526
Construction in progress, including advance payments related to plant and equipment	-		1,535		3,125
			26,338		23,580
Accumulated depreciation and amortization			(10,267)		(8,089)
Total		$	16,071	$	15,491

Depreciation and amortization of property, plant and equipment was $2,554 million, $2,352 million and $2,575 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Note 8. Equipment and Other Assets on Operating Leases, Net

The components of equipment and other assets on operating leases as of December 31 were as follows (in millions of dollars):

	Range of Service Lives (years)		2013		2012
Leased vehicles —Guaranteed Depreciation Program		5 - 15	$	1,028	$	601
Other leased assets		5 - 40		474		459
				1,502		1,060
Accumulated depreciation				(111)		(84)
Total			$	1,391	$	976

Included in “Leased vehicles —Guaranteed Depreciation Program” above are vehicles sold to daily rental car companies which are subject to guaranteed minimum resale values.

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

F-23

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 8. Equipment and Other Assets on Operating Leases, Net —Continued

Included in “Other leased assets” above are primarily buildings, warehouses and sales offices, as well as dealership and vehicle storage properties that we lease to our dealers and others.

Depreciation of equipment and other assets on operating leases was $209 million, $170 million and $117 million for the years ended December 31, 2013, 2012 and 2011, respectively, and is included in Cost of Sales in the accompanying Consolidated Statements of Income.

Future minimum lease payments due from customers for equipment and other assets on operating leases as of December 31, 2013 were as follows (in millions of dollars):

2014	$	19
2015		18
2016		12
2017		8
2018		5
2019 and thereafter		7

Note 9. Goodwill and Other Intangible Assets, Net

As of December 31, 2013 and 2012, we had goodwill of $1,361 million. No adjustments to the carrying amount of goodwill were recorded during the years ended December 31, 2013 and 2012. We have one operating segment, which is also our only reporting unit. The prior year financial information has been reclassified to conform to the current year presentation.

The components of other intangible assets, net as of December 31 were as follows (in millions of dollars):

	Range of Useful Lives (years)	2013
		Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets
Brand names	Indefinite	$	2,210	$	—	$	2,210
Dealer networks	20		388		89		299
Fiat contributed intellectual property rights	10		320		147		173
Other intellectual property rights	3 - 12		263		65		198
Patented and unpatented technology	4 - 10		208		145		63
Software	3 - 5		445		152		293
Other	1 - 16		261		122		139
Total		$	4,095	$	720	$	3,375

F-24

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 9. Goodwill and Other Intangible Assets, Net —Continued

	Range of Useful Lives (years)	2012
		Gross Carrying Amount		Accumulated Amortization		Net Intangible Assets
Brand names	Indefinite	$	2,210	$	—	$	2,210
Dealer networks	20		392		70		322
Fiat contributed intellectual property rights	10		320		114		206
Other intellectual property rights	3 - 12		263		37		226
Patented and unpatented technology	4 - 10		208		120		88
Software	4 - 5		339		100		239
Other	1 - 16		169		100		69
Total		$	3,901	$	541	$	3,360

During the years ended December 31, 2013 and 2012, additions of $199 million and $172 million, respectively, were recorded with a weighted-average amortization period of 5 years and 4 years, respectively.

The following summarizes the amount of intangible asset amortization expense included in the respective financial statement captions of the accompanying Consolidated Statements of Income (in millions of dollars):

		Years Ended December 31,
	Financial Statement Caption	2013		2012		2011
Favorable operating lease contracts	Revenues, Net	$	—	$	1	$	18
Patented and unpatented technology, intellectual property, software and other	Cost of Sales		158		159		164
Dealer networks and other	Selling, Administrative and Other Expenses		23		23		43
Total		$	181	$	183	$	225

Based on the gross carrying amount of other intangible assets as of December 31, 2013, the estimated future amortization expense for the next five years was as follows (in millions of dollars):

2014	$	182
2015		193
2016		155
2017		191
2018		85

F-25

Note 10. Prepaid Expenses and Other Assets

The components of prepaid expenses and other assets as of December 31 were as follows (in millions of dollars):

	2013						2012
	Current		Non- Current		Total		Current		Non- Current		Total
Amounts due from related parties (see Note 19)	$	729	$	—	$	729	$	503	$	—	$	503
Prepaid pension expense (see Note 18)		—		137		137		—		114		114
Other		918		300		1,218		605		289		894
Total	$	1,647	$	437	$	2,084	$	1,108	$	403	$	1,511

Note 11. Accrued Expenses and Other Liabilities

The components of accrued expenses and other liabilities as of December 31 were as follows (in millions of dollars):

	2013						2012
	Current		Non- Current		Total		Current		Non- Current		Total
Pension and postretirement benefits (see Note 18)	$	187	$	8,126	$	8,313	$	188	$	11,864	$	12,052
Product warranty costs		1,346		2,454		3,800		1,142		2,372		3,514
Sales incentives		3,636		—		3,636		3,031		—		3,031
Personnel costs		792		443		1,235		711		413		1,124
Amounts due to related parties (see Note 19) (1)		718		—		718		562		—		562
Income and other taxes		441		98		539		256		106		362
Vehicle residual value guarantees		343		—		343		238		—		238
Accrued interest (2)		301		—		301		342		—		342
Workers’ compensation		43		234		277		46		275		321
Restructuring actions (see Note 21)		22		34		56		69		—		69
Other		2,001		371		2,372		1,933		507		2,440
Total	$	9,830	$	11,760	$	21,590	$	8,518	$	15,537	$	24,055

(1) Excludes amounts due to related parties for interest separately discussed in (2) below.

(2) Includes $215 million and $222 million of accrued interest due to related parties as of December 31, 2013 and 2012, respectively. Refer to Note 19, Other Transactions with Related Parties, for additional information.

We issue various types of product warranties under which we generally guarantee the performance of products delivered for a certain period or term. The reserve for product warranties includes the expected costs of warranty obligations imposed by law or contract, as well as the expected costs for mandatory or voluntary actions to recall and repair vehicles and for buyback commitments. We establish reserves for product warranty obligations when the related sale is recognized, which are reflected in the summary of the changes in accrued warranty costs below as “Provision for current period warranties.” Estimates are principally based on assumptions regarding the lifetime warranty costs of each vehicle line and each model year of that vehicle line, as well as historical claims experience for our vehicles. Estimates of the future costs of these actions are inevitably imprecise due to numerous uncertainties, including the enactment of new laws and regulations, the number of vehicles affected by a service or recall action and the nature of the corrective action that may result in adjustments to the established reserves, which are reflected in the summary below as “Net adjustments to pre-existing warranties.”

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

F-26

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 11. Accrued Expenses and Other Liabilities —Continued

The changes in accrued product warranty costs (excluding deferred revenue from extended warranty and service contracts described below, as well as supplier recoveries) were as follows (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Balance at beginning of period	$	3,514	$	3,318	$	3,171
Provision for current period warranties		1,810		1,735		1,686
Net adjustments to pre-existing warranties		120		(158)		(106)
Net warranty settlements		(1,593)		(1,414)		(1,452)
Interest accretion, translation and other adjustments		(51)		33		19
Balance at end of period	$	3,800	$	3,514	$	3,318

During the years ended December 31, 2013, 2012 and 2011, we recognized recoveries from suppliers related to warranty claims of $106 million, $105 million and $115 million, respectively, which are excluded from the change in warranty costs above.

We also offer customers the opportunity to purchase separately-priced extended warranty and service contracts. In addition, from time to time we sell certain vehicles with a service contract included in the sales price of the vehicle. The service contract and vehicle qualified as separate units of accounting in accordance with the accounting guidance for multiple-element arrangements. Refer to Note 2,Basis of Presentation and Significant Accounting Policies,for additional information. The revenue from these contracts, as well as our separately-priced extended warranty and service contracts, is recorded as a component of Deferred Revenue in the accompanying Consolidated Balance Sheets at the inception of the contract and is recognized as revenue over the contract period in proportion to the costs expected to be incurred based on historical information.

The following summarizes the changes in deferred revenue from these contracts (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Balance at beginning of period	$	1,075	$	926	$	829
Deferred revenues for current period service contracts		680		600		545
Earned revenues in current period		(462)		(446)		(446)
Refunds of cancelled contracts		(59)		(54)		(53)
Interest accretion, translation and other adjustments		5		49		51
Balance at end of period	$	1,239	$	1,075	$	926

F-27

Note 12. Financial Liabilities

The components of financial liabilities as of December 31 were as follows (in millions of dollars):

	2013
	Interest Rate		Face Value		Carrying Value
Financial Liabilities Payable Within One Year:
	Effective
VEBA Trust Note		11.71%	$	224	$	221
Tranche B Term Loan		4.08% (1)		30		30
Canadian Health Care Trust Notes:
Tranche A		7.38% (2)		83		85
Tranche B		9.21% (2)		24		24
Total Canadian Health Care Trust Notes				107		109
Mexican development banks credit facility due 2025		8.81% (3)		30		30
	Weighted Average
Other:
Capital lease obligations		9.95%		64		55
Other financial obligations		15.14%		51		46
Total other financial liabilities				115		101
Total financial liabilities payable within one year			$	506	$	491

	Maturity		Interest Rate		Face Value		Carrying Value
Financial Liabilities Payable After One Year:
			Effective
VEBA Trust Note		7/15/2023		11.71%	$	4,491	$	3,971
Tranche B Term Loan		5/24/2017		4.08% (1)		2,895		2,842
Secured Senior Notes due 2019		6/15/2019		8.21% (4)		1,500		1,486
Secured Senior Notes due 2021		6/15/2021		8.44% (5)		1,700		1,683
Canadian Health Care Trust Notes:
Tranche A		6/30/2017		7.38% (2)		298		312
Tranche B		6/30/2024		9.21% (2)		402		411
Tranche C		6/30/2024		9.68% (6)		110		95
Total Canadian Health Care Trust Notes						810		818
Mexican development banks credit facilities:
Credit facility due 2021		12/23/2021		7.50% (7)		229		229
Credit facility due 2025		7/19/2025		8.81% (3)		318		318
Total Mexican development banks credit facilities						547		547
			Weighted Average
Other:
Capital lease obligations		2016-2020		11.04%		316		286
Other financial obligations		2015-2024		13.83%		191		177
Total other financial liabilities						507		463
Total financial liabilities payable after one year						12,450		11,810
Total					$	12,956	$	12,301

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

F-28

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

	2012
	Interest Rate		Face Value		Carrying Value
Financial Liabilities Payable Within One Year:
	Effective
VEBA Trust Note		11.71%	$	159	$	159
Tranche B Term Loan		6.46% (1)		30		30
Canadian Health Care Trust Notes:
Tranche A		7.98% (2)		79		79
Tranche B		9.21% (2)		23		23
Total Canadian Health Care Trust Notes				102		102
Mexican development banks credit facility due 2025		9.62% (3)		30		30
	Weighted Average
Other:
Capital lease obligations		11.50%		36		27
Other financial obligations		11.09%		115		108
Total other financial liabilities				151		135
Total financial liabilities payable within one year			$	472	$	456

	Maturity		Interest Rate		Face Value		Carrying Value
Financial Liabilities Payable After One Year:
			Effective
VEBA Trust Note		7/15/2023		11.71%	$	4,715	$	4,129
Tranche B Term Loan		5/24/2017		6.46% (1)		2,925		2,874
Secured Senior Notes due 2019		6/15/2019		8.21% (4)		1,500		1,484
Secured Senior Notes due 2021		6/15/2021		8.44% (5)		1,700		1,681
Canadian Health Care Trust Notes:
Tranche A		6/30/2017		7.98% (2)		402		426
Tranche B		6/30/2024		9.21% (2)		456		467
Tranche C		6/30/2024		9.68% (6)		109		92
Total Canadian Health Care Trust Notes						967		985
Mexican development banks credit facilities:
Credit facility due 2021		12/23/2021		8.54% (7)		231		231
Credit facility due 2025		7/19/2025		9.62% (3)		350		350
Total Mexican development banks credit facilities						581		581
			Weighted Average
Other:
Capital lease obligations		2014-2020		12.43%		251		214
Other financial obligations		2014-2024		13.43%		218		199
Total other financial liabilities						469		413
Total financial liabilities payable after one year						12,857		12,147
Total					$	13,329	$	12,603

F-29

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

(1) Loan bears interest at LIBOR (subject to a 0.75 percent floor) + 2.75 percent and LIBOR (subject to a 1.25 percent floor) + 4.75 percent at December 31, 2013 and December 31, 2012, respectively. Commencing in July 2011, interest has been reset every three months. Stated interest rate as of December 31, 2013 and December 31, 2012 was 3.50 percent and 6.00 percent, respectively.

(2) Note bears interest at a stated rate of 9.00 percent.

(3) Represents the stated interest rate. Loan bears interest at the 28 day Interbank Equilibrium Interest Rate (“TIIE”) + 4.80 percent subject to a quarterly reset of TIIE.

(4) Notes bear interest at a stated rate of 8.00 percent.

(5) Notes bear interest at a stated rate of 8.25 percent.

(6) Note bears interest at a stated rate of 7.50 percent.

(7) Represents the stated interest rate. Loan bears interest at the 28 day TIIE + 3.70 percent subject to a monthly reset of TIIE.

As of December 31, 2013, the carrying amounts of our financial obligations were net of fair value adjustments, discounts, premiums and loan origination fees totaling $655 million related to the following obligations (in millions of dollars):

VEBA Trust Note	$	523
Tranche B Term Loan		53
Secured Senior Notes due 2019		14
Secured Senior Notes due 2021		17
Canadian Health Care Trust Notes		(10)
Liabilities from capital leases and other financial obligations		58
Total	$	655

As of December 31, 2013, the aggregate annual contractual maturities of our financial liabilities at face value were as follows (in millions of dollars):

2014	$	506
2015		516
2016		557
2017		3,442
2018		689
2019 and thereafter		7,246
Total	$	12,956

Senior Credit Facilities and Secured Senior Notes

On May 24, 2011, we and certain of our U.S. subsidiaries as guarantors entered into the following arrangements:

• Senior Credit Facilities — a $3.0 billion tranche B term loan maturing on May 24, 2017 (“Tranche B Term Loan”), which was fully drawn on May 24, 2011 and a $1.3 billion revolving credit facility that matures on May 24, 2016 (“Revolving Facility”) and remains undrawn, which were subsequently amended and re-priced on June 21, 2013 to lower applicable interest rates, among other things, and the Tranche B Term Loan was subsequently re-priced on December 23, 2013 to further lower applicable interest rates;

F-30

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Senior Credit Facilities and Secured Senior Notes —Continued

• Secured Senior Notes due 2019 — issuance of $1.5 billion of 8 percent secured senior notes due June 15, 2019 (“Original 2019 Notes”); and

• Secured Senior Notes due 2021 — issuance of $1.7 billion of 8 ¹⁄₄ percent secured senior notes due June 15, 2021 (“Original 2021 Notes”).

Senior Credit Facilities

The Senior Credit Facilities are with a syndicate of private sector lenders that provide for borrowings of up to $4.3 billion and include a revolving credit facility which may be borrowed and repaid from time to time until the maturity date. We amended and restated our credit agreement dated as of May 24, 2011 (“Original Senior Credit Agreement”) among us and the lenders party thereto. The amendments to the Original Senior Credit Agreement were given effect in the amended and restated credit agreement, dated as of June 21, 2013 (“Senior Credit Agreement”). Additionally, on December 23, 2013 we re-priced the Tranche B Term Loan governed by the Senior Credit Agreement.

The Original Senior Credit Agreement provided for a $3.0 billion tranche B term loan that was to mature on May 24, 2017, which was fully drawn on May 24, 2011 and a $1.3 billion revolving credit facility that was to mature on May 24, 2016, which was undrawn. The maturity dates did not change under the Senior Credit Agreement. The Revolving Facility remains undrawn as of December 31, 2013.

The amendment in June 2013 reduced the applicable interest rate spreads on the Senior Credit Facilities by 1.50 percent per annum and reduced the rate floors applicable to the Tranche B Term Loan by 0.25 percent per annum. As a result, all amounts outstanding under the Revolving Facility will bear interest, at our option, either at a base rate plus 2.25 percent per annum or at LIBOR plus 3.25 percent per annum. The subsequent re-pricing in December 2013 further reduced the applicable interest rate spreads and interest rate floors applicable to the Tranche B Term Loan by an additional 0.50 percent and 0.25 percent, respectively, per annum. All amounts outstanding under the Tranche B Term Loan will bear interest, at our option, either at a base rate plus 1.75 percent per annum or at LIBOR plus 2.75 percent per annum, subject to a base rate floor of 1.75 percent per annum or a LIBOR floor of 0.75 percent per annum, respectively. We currently accrue interest based on LIBOR.

In addition, the amendment in June 2013 reduced the commitment fee payable on the Revolving Facility to 0.50 percent per annum, which may be reduced to 0.375 percent per annum if we achieve a specified consolidated leverage ratio, of the daily average undrawn portion of the Revolving Facility. The commitment fee remains payable quarterly in arrears.

The outstanding principal amount of the Tranche B Term Loan is payable in equal quarterly installments of $7.5 million, with the remaining balance due at maturity. No scheduled principal payments are required on amounts drawn on the Revolving Facility until the maturity date of the facility.

F-31

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Senior Credit Facilities and Secured Senior Notes —Continued

Senior Credit Facilities —Continued

If we voluntarily refinance or re-price all or any portion of the Tranche B Term Loan before the six-month anniversary of the effective date of the re-pricing in December 2013, under certain circumstances, we will be obligated to pay a call premium equal to 1.00 percent of the principal amount refinanced or re-priced.

Certain negative covenants in the Original Senior Credit Agreement were also amended, including limitations on incurrence of indebtedness and certain limitations on restricted payments, which include dividends. Under the Senior Credit Agreement, among other exceptions, the restricted payment capacity was increased to an amount not to exceed 50 percent of our cumulative consolidated net income, as defined in the Senior Credit Agreement, since January 1, 2012.

In connection with the June 21, 2013 amendment and December 23, 2013 re-pricing, lenders party to the Tranche B Term Loan that held $790 million of the outstanding principal balance either partially or fully reduced their holdings. These reductions were accounted for as debt extinguishments. The remaining holdings were analyzed on a lender-by-lender basis and accounted for as debt modifications. The outstanding principal balance on the Tranche B Term Loan did not change, as new and continuing lenders acquired the $790 million.

We paid $38 million related to the call premium and other fees to re-price and amend the Original Senior Credit Agreement and to re-price the Tranche B Term Loan, of which $30 million was deferred and will be amortized over the remaining terms of the Senior Credit Facilities. We recognized a $24 million loss on extinguishment of debt, which included the write off of $13 million of unamortized debt discounts and $3 million of unamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of the call premium and fees noted above.

Up to $200 million of the Revolving Facility may be used for the issuance of letters of credit. Prior to the final maturity date of each of the facilities, we have the option to extend the maturity date of all or a portion of these facilities with the consent of the lenders whose loans or commitments are being extended. We also have the option to increase the amount of these facilities in an aggregate principal amount not to exceed $1.2 billion, either through an additional term loan, an increase in the Revolving Facility or a combination of both, subject to certain conditions.

Mandatory prepayments are required, subject to certain exceptions, from the net cash proceeds of asset sales, incurrence of additional indebtedness, insurance or condemnation proceeds and excess cash flow. In the case of excess cash flow, the mandatory prepayments are subject to a leverage-based step-down and only to the extent our liquidity exceeds a certain threshold.

The Senior Credit Facilities are secured by a senior priority security interest in substantially all of Chrysler Group LLC’s assets and the assets of its U.S. subsidiary guarantors, subject to certain exceptions. The collateral includes 100 percent of the equity interests in Chrysler Group LLC’s domestic subsidiaries and 65 percent of the equity interests in certain foreign subsidiaries held directly by Chrysler Group LLC and its U.S. subsidiary guarantors.

The Senior Credit Agreement includes a number of affirmative covenants, many of which are customary, including, but not limited to, the reporting of financial results and other developments, compliance with laws, payment of taxes, maintenance of insurance and similar requirements. The Senior Credit Agreement also contains several negative covenants, including but not limited to, (i) limitations on incurrence, repayment and prepayment of indebtedness; (ii) limitations on incurrence of liens; (iii) limitations on making restricted

F-32

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Senior Credit Facilities and Secured Senior Notes —Continued

Senior Credit Facilities —Continued

payments, including a limit on declaring dividends or making distributions to our members or stockholders, as the case may be; (iv) limitations on transactions with affiliates, swap agreements and sale and leaseback transactions; (v) limitations on fundamental changes, including certain asset sales and (vi) restrictions on certain subsidiary distributions. In addition, the Senior Credit Agreement requires us to maintain a minimum ratio of borrowing base to covered debt, as well as a minimum liquidity of $3.0 billion, which includes any undrawn amounts on the Revolving Facility.

The Senior Credit Agreement contains a number of events of default related to, (i) failure to make payments when due; (ii) failure to comply with covenants; (iii) breaches of representations and warranties; (iv) certain changes of control; (v) cross-default with certain other debt and hedging agreements and (vi) the failure to pay or post bond for certain material judgments. As of December 31, 2013 we were in compliance with all covenants under the Senior Credit Agreement.

Refer to Note 25,Subsequent Events, for information regarding the additional term loan borrowing under the Senior Credit Agreement.

Secured Senior Notes

We entered into an indenture with CG Co-Issuer Inc. (“CG Co-Issuer”), our 100 percent owned special purpose finance subsidiary, certain of our 100 percent owned U.S. subsidiaries (“Guarantors”) and Wilmington Trust FSB, as trustee and Citibank, N.A. as collateral agent, paying agent, registrar and authenticating agent, pursuant to which we issued the Original 2019 Notes and the Original 2021 Notes, collectively referred to as the “Original Notes.” The Original Notes were issued at par and were sold in a private placement to (i) qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”) and (ii) outside the United States to persons who are not U.S. persons (as defined in Rule 902 of Regulation S under the Securities Act) in compliance with Regulation S under the Securities Act.

In connection with the offering of the Original Notes, we entered into a registration rights agreement with the initial purchasers of the Original Notes. Under the terms of the registration rights agreement, we agreed to register notes having substantially identical terms as the Original Notes with the Securities and Exchange Commission (“SEC”) as part of an offer to exchange freely tradable exchange notes for the Original Notes. On December 29, 2011, and subject to the terms and conditions set forth in our prospectus, we commenced an offer to exchange our new 8 percent secured senior notes due 2019 (“2019 Notes”) for the outstanding Original 2019 Notes and our new 8 ¹⁄₄percent secured senior notes due 2021 (“2021 Notes”) for the outstanding Original 2021 Notes. The 2019 Notes and 2021 Notes are collectively referred to as the “Notes.”

On February 1, 2012, our offers to exchange the Original 2019 Notes and Original 2021 Notes expired. Substantially all of the Original Notes were tendered for the Notes. The holders of the Notes received an equal principal amount of 2019 Notes for the Original 2019 Notes and an equal principal amount of 2021 Notes for the Original 2021 Notes. The form and terms of the Notes are identical in all material respects to the Original Notes, except that the Notes do not contain restrictions on transfer.

Beginning December 15, 2011, interest on each series of the Original Notes is payable semi-annually in June and December of each year, to the holders of record of such Original Notes at the close of business on June 1 or December 1, respectively, preceding such interest payment date.

F-33

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Senior Credit Facilities and Secured Senior Notes —Continued

Secured Senior Notes —Continued

We may redeem, at any time, all or any portion of the 2019 Notes on not less than 30 and not more than 60 days’ prior notice mailed to the holders of the 2019 Notes to be redeemed. Prior to June 15, 2015, the 2019 Notes will be redeemable at a price equal to the principal amount of the 2019 Notes being redeemed, plus accrued and unpaid interest to the date of redemption and a “make-whole” premium calculated under the indenture. At any time prior to June 15, 2014, we may also redeem up to 35 percent of the aggregate principal amount of the 2019 Notes, at a redemption price equal to 108 percent of the principal amount of the 2019 Notes being redeemed, plus accrued and unpaid interest to the date of redemption with the net cash proceeds from certain equity offerings. On and after June 15, 2015, the 2019 Notes are redeemable at redemption prices specified in the 2019 Notes, plus accrued and unpaid interest to the date of redemption. The redemption price is initially 104 percent of the principal amount of the 2019 Notes being redeemed for the twelve months beginning June 15, 2015, decreasing to 102 percent for the year beginning June 15, 2016 and to par on and after June 15, 2017.

We may redeem, at any time, all or any portion of the 2021 Notes on not less than 30 and not more than 60 days’ prior notice mailed to the holders of the 2021 Notes to be redeemed. Prior to June 15, 2016, the 2021 Notes will be redeemable at a price equal to the principal amount of the 2021 Notes being redeemed, plus accrued and unpaid interest to the date of redemption and a “make-whole” premium calculated under the indenture. At any time prior to June 15, 2014, we may also redeem up to 35 percent of the aggregate principal amount of the 2021 Notes, at a redemption price equal to 108.25 percent of the principal amount of the 2021 Notes being redeemed, plus accrued and unpaid interest to the date of redemption with the net cash proceeds from certain equity offerings. On and after June 15, 2016, the 2021 Notes are redeemable at redemption prices specified in the 2021 Notes, plus accrued and unpaid interest to the date of redemption. The redemption price is initially 104.125 percent of the principal amount of the 2021 Notes being redeemed for the twelve months beginning June 15, 2016, decreasing to 102.75 percent for the year beginning June 15, 2017, to 101.375 percent for the year beginning June 15, 2018 and to par on and after June 15, 2019.

The indenture includes affirmative covenants, including the reporting of financial results and other developments. The indenture also contains negative covenants related to our ability and, in certain instances, the ability of certain of our subsidiaries to, (i) pay dividends or make distributions on the Company’s capital stock or repurchase the Company’s capital stock; (ii) make restricted payments; (iii) create certain liens to secure indebtedness; (iv) enter into sale and leaseback transactions; (v) engage in transactions with affiliates; (vi) merge or consolidate with certain companies and (vii) transfer and sell assets.

The indenture provides for customary events of default, including but not limited to, (i) nonpayment; (ii) breach of covenants in the indenture; (iii) payment defaults or acceleration of other indebtedness; (iv) a failure to pay certain judgments and (v) certain events of bankruptcy, insolvency and reorganization. If certain events of default occur and are continuing, the trustee or the holders of at least 25 percent in aggregate of the principal amount of the Notes outstanding under one of the series may declare all of the Notes of that series to be due and payable immediately, together with accrued interest, if any. As of December 31, 2013, we were in compliance with all covenants under the indenture.

Refer to Note 25,Subsequent Events, for information regarding additional issuances of Secured Senior Notes.

F-34

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

VEBA Trust Note

On June 10, 2009, and in accordance with the terms of a settlement agreement between us and the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (“UAW”) (the “VEBA Settlement Agreement”), we issued a senior unsecured note with a face value of $4,587 million to the VEBA Trust (“VEBA Trust Note”).

The VEBA Trust Note has an implied interest rate of 9.0 percent per annum and requires annual payments of principal and interest on July 15. Scheduled VEBA Trust Note payments through 2012 did not fully satisfy the interest accrued at the implied rate. In accordance with the agreement, the difference between a scheduled payment and the accrued interest through June 30 of the payment year was capitalized as additional debt on an annual basis. In July 2013, we made a scheduled payment of $600 million, which was composed of $441 million of interest accrued through the payment date and $159 million of interest that was previously capitalized as additional debt. In July 2012 and 2011, we made scheduled payments of $400 million and $300 million, respectively, on the VEBA Trust Note and $38 million and $126 million, respectively, of accrued interest was capitalized as additional debt.

The payment of capitalized interest is included as a component of Net Cash Provided by Operating Activities in the accompanying Consolidated Statements of Cash Flows.

The VEBA Trust Note was issued under the terms of an indenture that contains certain negative covenants, including, but not limited to, limitations on incurrence of indebtedness by Chrysler Group LLC that is senior, in any respect, in right of payment to the VEBA Trust Note and limits on the ability of our subsidiaries to incur indebtedness. The terms of a related registration rights agreement provide for certain registration rights that entitle the holder of the VEBA Trust Note to require us to file a registration statement under the Securities Act, for a public offering of the VEBA Trust Note beginning six months following Fiat’s acquisition of a majority ownership interest in us, which occurred in July 2011, and such rights became effective in January 2012.

Refer to Note 18,Employee Retirement and Other Benefits, for additional information regarding the VEBA Trust Note and VEBA Settlement Agreement and to Note 25,Subsequent Events, for information regarding the repayment of the VEBA Trust Note.

Canadian Health Care Trust Notes

On December 31, 2010, Chrysler Canada Inc., (“Chrysler Canada”), issued four unsecured promissory notes to an independent Canadian Health Care Trust (“HCT”) in an initial aggregate face value of $976 million ($974 million Canadian dollar, “CAD”), which we collectively refer to as the Canadian HCT Notes. These notes were issued as part of the settlement of its obligations with respect to retiree health care benefits for National Automobile, Aerospace, Transportation and General Workers Union of Canada (“CAW”, now part of Unifor) represented employees, retirees and dependents, which we refer to as the Canadian Health Care Trust Settlement Agreement. In addition, the Canadian HCT Notes had accrued interest from January 1, 2010 through December 31, 2010 of $80 million ($80 million CAD) and a $31 million ($31 million CAD) net premium.

The terms of each of the notes are substantially similar and provide that each note will rankpari passu with all existing and future unsecured and unsubordinated indebtedness for borrowed money of Chrysler Canada, and that Chrysler Canada will not incur indebtedness for borrowed money that is senior in any respect in right of payment to the notes.

F-35

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Canadian Health Care Trust Notes —Continued

Payments on the Canadian HCT Notes are due on June 30 of each year unless that day is not a business day in Canada, in which case payments are due on the next business day (“Scheduled Payment Date”). Interest is accrued at the stated rate of 9.0 percent per annum for the HCT Tranche A and B notes. Accrued interest in excess of payments on the HCT Tranche A and B notes is capitalized as additional debt on the Scheduled Payment Date. We are not required to make a payment on the HCT Tranche C note until 2020. However, interest accrued at the stated rate of 7.5 percent per annum on the HCT Tranche C note will be capitalized as additional debt on the Scheduled Payment Date through 2019. In July 2013, July 2012 and June 2011, $25 million, $74 million and $27 million, respectively, of interest accrued in excess of the scheduled payments was capitalized as additional debt.

In July 2013, we made a scheduled payment on the HCT Tranche B note of $66 million, which was composed of $44 million of interest accrued through the payment date and $22 million of interest that was previously capitalized as additional debt.

In January 2013, we made a prepayment on the HCT Tranche A note of the scheduled payment due on July 2, 2013. The amount of the prepayment, determined in accordance with the terms of the HCT Tranche A note, was $117 million and was composed of a $92 million principal payment and interest accrued through January 3, 2013 of $25 million. The $92 million HCT Tranche A note principal payment consisted of $47 million of interest that was previously capitalized as additional debt with the remaining $45 million representing a repayment of the original principal balance.

In 2012 and 2011, we made payments of $44 million and $47 million, respectively, on the Canadian HCT Notes, which included principal and interest accrued through the respective payment dates. The HCT Tranche D note was fully repaid in 2012.

The payments of capitalized interest are included as a component of Net Cash Provided by Operating Activities in the accompanying Consolidated Statements of Cash Flows.

Mexico Development Banks Credit Facilities

In July 2010, Chrysler de Mexico, S.A. de C.V. (“Chrysler de Mexico”), our principal operating subsidiary in Mexico, entered into a financing arrangement with certain Mexican development banks which provides for a 15 year amortizing term loan facility equal to the Mexican peso equivalent of $400 million. The facility was fully drawn during July 2010 and was funded in Mexican pesos. Any amounts repaid on the facility cannot be re-borrowed.

In December 2011, Chrysler de Mexico entered into a financing arrangement with certain Mexican development banks which provides for a ten year amortizing term loan facility of 3.0 billion Mexican pesos. The facility was fully drawn during December 2011 and was funded in Mexican pesos. Principal payments on the loan are not required until 2016, and any amounts repaid cannot be re-borrowed.

The terms of these loans are similar. Chrysler de Mexico placed certain of its assets in special purpose trusts to secure repayment of the loans, including certain receivables and property, plant and equipment. As of December 31, 2013 and 2012, Chrysler de Mexico had $56 million and $66 million, respectively, of cash on deposit with the trusts, which is included in Prepaid Expenses and Other Assets in the accompanying

F-36

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Mexico Development Banks Credit Facilities —Continued

Consolidated Balance Sheets. The loans require compliance with certain covenants, including, but not limited to, limitations on liens, incurrence of debt and asset sales. As of December 31, 2013, we were in compliance with all covenants under the facilities.

Gold Key Lease

We previously used special purpose entities to securitize future lease payments and vehicle residual values for the portfolio of vehicles under our Gold Key Lease financing program. We were the sole beneficiary of the consolidated assets from these VIEs and accordingly, we were considered to be the primary beneficiary. Chrysler Canada maintains our Gold Key Lease vehicle lease portfolio. The related vehicles are leased to Canadian consumers and were financed by asset-backed securitization facilities, as well as a $4.7 billion (5.0 billion CAD) secured revolving credit facility. In June 2012, we repaid the remaining outstanding balance of the asset-backed note payable. These obligations were primarily repaid out of collections from the operating leases and proceeds from the sales of the related vehicles. We are currently winding down the Gold Key Lease program, therefore, no additional funding will be required. No vehicles were added to the portfolio during the years ended December 31, 2013 and 2012.

U.S. Treasury Credit Facilities

On June 10, 2009, and in connection with the 363 Transaction, we entered into a first lien credit agreement with the U.S. Treasury, which included a $2.0 billion term loan (“Tranche B Loan”) used to acquire substantially all of the net operating assets of Old Carco. The credit agreement also made various term loans available to us for future working capital needs in an amount not to exceed $4.6 billion (“Tranche C Commitment”). In addition, we provided the U.S. Treasury a $288 million note and assumed $500 million of U.S. Treasury loans originally provided to Chrysler Holding LLC (“Chrysler Holding”) for the benefit of Old Carco. We collectively refer to these loans, as well as the amounts drawn on the Tranche C Commitment, as “Tranche C Loans.” We also provided the U.S. Treasury a $100 million zero coupon note.

The Tranche C Commitment was scheduled to accrue quarterly payable-in-kind (“PIK”) interest of a maximum of $17 million through June 10, 2017, and the PIK interest was to be capitalized on a quarterly basis. Accordingly, $17 million and $68 million of PIK interest was capitalized as additional debt during the three months ended March 31, 2011 and the year ended December 31, 2010, respectively.

On May 24, 2011, we repaid all amounts owed under the U.S. Treasury first lien credit agreement and terminated all lending commitments thereunder. SeeRepayment of U.S. Treasury and EDC Credit Facilities below for additional information.

Export Development Canada Credit Facilities

Chrysler Canada entered into a loan and security agreement with Export Development Canada (“EDC”) on March 30, 2009, which was subsequently amended on April 29, 2009, pursuant to which the EDC provided a $1,238 million ($1,209 million CAD) secured term loan facility known as “Tranche X”. On June 10, 2009, the EDC loan agreement was amended and restated to increase the secured term loan facility by a CAD equivalent of $909 million USD, up to a maximum of $1,116 million CAD. The increase in the loan facility was known as

F-37

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Export Development Canada Credit Facilities —Continued

“Tranche X-2”. In addition to the Tranche X and Tranche X-2 loans, Chrysler Canada provided the EDC additional notes of $81 million ($80 million CAD). The additional notes were included in the Tranche X facility.

On May 24, 2011, we repaid all amounts owed under the EDC loan and security agreement and terminated all lending commitments thereunder. SeeRepayment of U.S. Treasury and EDC Credit Facilities, below, for additional information.

Repayment of U.S. Treasury and EDC Credit Facilities

On May 24, 2011, we repaid all amounts outstanding under the U.S. Treasury and EDC credit facilities. Refer toU.S. Treasury Credit Facilitiesand Export Development Canada Credit Facilities,above, for additional information related to these agreements.

Payments were made as follows (in millions of dollars):

	Principal		Accrued Interest		Total Payment
U.S. Treasury first lien credit facilities:
Tranche B	$	2,080 (1)	$	22	$	2,102
Tranche C		3,675 (2)		65		3,740
Zero Coupon Note		100		—		100
Total U.S Treasury first lien credit facilities		5,855		87		5,942
EDC credit facilities:
Tranche X		1,319		14		1,333
Tranche X-2		404		4		408
Total EDC credit facilities		1,723		18		1,741
Total U.S Treasury and EDC credit facilities	$	7,578	$	105	$	7,683

(1) Includes $80 million of PIK interest previously capitalized. The payment of PIK interest is included as a component of Net Cash Provided by Operating Activities in the accompanying Consolidated Statements of Cash Flows.

(2) Includes $315 million of PIK interest previously capitalized. The payment of PIK interest is included as a component of Net Cash Provided by Operating Activities in the accompanying Consolidated Statements of Cash Flows. In addition, as a result of the termination of the Ally MTA and in accordance with the U.S. Treasury first lien credit agreement, amounts outstanding under that agreement were reduced by $4 million, the amount of qualifying losses incurred by Ally through April 2011. Refer toNote 14, Commitments, Contingencies and Concentrations, for additional information related to the Ally MTA.

In connection with the repayment of our outstanding obligations under the U.S. Treasury and EDC credit facilities, we recognized a $551 million loss on extinguishment of debt, which consisted of the write off of $136 million of unamortized discounts and $34 million of unamortized debt issuance costs associated with the U.S. Treasury credit facilities and $367 million of unamortized discounts and $14 million of unamortized debt issuance costs associated with the EDC credit facilities. These charges are included in Loss on Extinguishment of Debt in the accompanying Consolidated Statements of Income.

F-38

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 12. Financial Liabilities —Continued

Amounts Available for Borrowing under Credit Facilities

As of December 31, 2013, our $1.3 billion Revolving Facility remains undrawn and the Tranche B Term Loan and Mexican development banks credit facilities remain fully drawn. Our $4.7 billion ($5.0 billion CAD) Gold Key Lease secured revolving credit facility remains undrawn as of December 31, 2013, however, no additional funding will be provided due to winding down the Gold Key Lease program.

Note 13. Income Taxes

The following table summarizes income (loss) before income taxes by jurisdiction (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
United States	$	1,162	$	971	$	(15)
Foreign		1,042		971		396
Total	$	2,204	$	1,942	$	381

The following table summarizes the allocation of income tax (benefit) expense as follows (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Income from continuing operations	$	(553)	$	274	$	198
Other comprehensive income		191		(5)		—
Total	$	(362)	$	269	$	198

The following table summarizes income tax (benefit) expense (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Current income tax expense:
Foreign	$	369	$	267	$	210
State and local		11		7		5
		380		274		215
Deferred income tax (benefit) expense:
Foreign		(851)		8		(20)
State and local		(82)		(8)		3
		(933)		—		(17)
Total	$	(553)	$	274	$	198

F-39

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 13. Income Taxes —Continued

The significant components of deferred tax (benefit) expense were as follows (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Deferred tax expense (benefit) (exclusive of the items below)	$	29	$	15	$	(13)
Benefits of operating loss carryforwards		(10)		(12)		(7)
Adjustment due to changes in enacted tax rates or laws		4		(3)		3
Decrease in beginning-of-the-year valuation allowance(1)		(956)		—		—
Total	$	(933)	$	—	$	(17)

(1) In December 2013, we recognized a $962 million non-cash tax benefit related to the release of valuation allowances on certain deferred tax assets which is comprised of $956 million related to the beginning-of-the-year valuation allowance and $6 million related to current year activity.

Provisions are made for estimated foreign income taxes, less available tax credits and deductions, which may be incurred on the future repatriation of our share of our subsidiaries’ undistributed cumulative earnings which are not deemed to be permanently reinvested. There were no provisions recorded on temporary differences of approximately $2,463 million for U.S. income taxes and approximately $2,573 million for foreign withholding taxes because these differences are permanent in duration. This amount may become taxable upon a repatriation of assets from the subsidiaries or a sale or liquidation of the subsidiaries. There are no plans to repatriate the retained earnings from these subsidiaries, as the earnings are permanently reinvested. Quantification of the deferred tax liability, if any, associated with permanently reinvested earnings is not practicable.

A reconciliation of income tax (benefit) expense provided using the U.S. federal statutory tax rate of 35 percent to actual income taxes was as follows (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Tax expense at U.S. federal statutory tax rate	$	771	$	680	$	135
Limited liability company (income)/losses not subject to federal or state taxes		(348)		(296)		79
Adjustment to taxes receivable		(1)		2		(20)
Valuation allowances		(956)		(77)		6
Foreign statutory rate difference		(94)		(83)		(31)
Non-deductible expenses		24		9		(6)
Withholding taxes		77		27		10
Foreign currency translation		(26)		10		(26)
Prior year tax return adjustments		(8)		4		61
Other		8		(2)		(10)
	$	(553)	$	274	$	198
Effective income tax rate		(25)%		14%		52%

The prior year financial information has been reclassified to conform with current year presentation.

F-40

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 13. Income Taxes —Continued

For the year ended December 31, 2013, the relationship between income tax (benefit) expense and the U.S. federal statutory tax rate differs primarily due to the release of the valuation allowances on certain of our net deferred tax assets. The difference is also due to income generated by us and certain of our 100 percent owned U.S. subsidiaries as we are a limited liability company (“LLC”) taxed as a partnership and substantially all of our 100 percent owned U.S. subsidiaries are LLCs that are disregarded entities for U.S. federal tax purposes. The difference is also due to differences between foreign statutory tax rates and the U.S. federal statutory tax rate.

For the year ended December 31, 2012, the relationship between income tax expense and the U.S. federal statutory tax rate differs primarily due to income generated by us and certain of our 100 percent owned U.S. subsidiaries as we are an LLC taxed as a partnership and substantially all of our 100 percent owned U.S. subsidiaries are LLCs that are disregarded entities for U.S. federal tax purposes. The difference is also due to differences between foreign statutory tax rates and the U.S. federal statutory tax rate.

For the year ended December 31, 2011, the relationship between income tax expense and the U.S. federal statutory tax rate differs primarily due to losses generated by us and our LLC’s. The difference is also due to adjustments made to prior year returns and differences between foreign statutory tax rates and the U.S. federal statutory tax rate.

As of December 31, 2013, we had approximately $83 million of total unrecognized tax benefits on uncertain tax positions. These are tax contingencies recorded, that if reversed due to a successful outcome, would favorably affect the income tax rate in future periods. Our practice is to recognize interest and penalties on uncertain tax positions in income tax expense. During the years ended December 31, 2013, 2012 and 2011, net interest expense of $3 million, $3 million and $2 million, respectively, was recognized in income tax expense. Accrued interest on uncertain tax positions was $12 million and $15 million as of December 31, 2013 and 2012, respectively.

A reconciliation of unrecognized tax benefits was as follows (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Unrecognized tax benefits at beginning of period	$	101	$	140	$	949
Settlements with tax authorities		(6)		(34)		(783)
Gross increases for tax positions of prior years		10		32		30
Gross decreases for tax positions of prior years		(17)		(37)		(52)
Exchange rate differences		(5)		—		(4)
Unrecognized tax benefits at end of period	$	83	$	101	$	140

For the year ended December 31, 2011, the settlements with tax authorities of $783 million related to tax payments made during 2011 by a subsidiary of Daimler AG (“Daimler”) or by us in connection with the Chrysler Canada transfer pricing audit, which is described below.

In connection with the 363 Transaction, we acquired a majority of the equity investments of Old Carco’s direct and indirect subsidiaries and assumed liabilities for uncertain tax positions related to those subsidiaries. We file income tax returns in multiple jurisdictions and are subject to examination by taxing authorities throughout the world. Examinations by tax authorities have been completed through 2006 in Mexico and 2007 in Canada.

F-41

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 13. Income Taxes —Continued

Chrysler Canada was reassessed additional taxes for the years 1996 through August 3, 2007 by the Canada Revenue Agency (“CRA”) and the Provincial Tax Authorities, collectively referred to as the “Canadian Tax Authorities,” related to transfer pricing adjustments (the “Canadian Transfer Pricing Reassessment”). In accordance with the terms of the June 3, 2009 tax settlement agreement between CG Investment Group LLC, Chrysler Holding, Old Carco and Daimler, which was subsequently assigned to and assumed by us in connection with the 363 Transaction, Daimler agreed to reimburse us for any tax and related interest and penalties in respect of certain specific tax liabilities arising prior to August 3, 2007, including the Canadian Transfer Pricing Reassessment.

The final reassessment on the Canadian transfer pricing matter (“Final Reassessment”) resulted in $1.5 billion of additional taxes and interest associated with this matter being owed to the Canadian Tax Authorities. The Canadian Tax Authorities applied $751 million of payments previously made by us against the amount owing under the Final Reassessment and as of December 31, 2011, Daimler had fully reimbursed us for these amounts. In addition, during 2011 Daimler made payments of $660 million to the Canadian Tax Authorities related to this matter and we fully settled the remainder of the obligation in 2012. We did not receive any additional reimbursements from Daimler related to this matter during 2013 or 2012. As of December 31, 2013 and 2012, our tax receivable from Daimler associated with this matter was $58 million and $63 million, respectively, and is included in Prepaid Expenses and Other Assets in the accompanying Consolidated Balance Sheets.

Deferred tax assets and liabilities result from differences between assets and liabilities measured for financial reporting purposes and those measured for income tax return purposes. The table below summarizes the significant components of deferred tax assets and liabilities as of December 31 (in millions of dollars):

	2013		2012
Deferred Tax Assets
Accrued expenses	$	535	$	542
Postretirement health care and life insurance benefits		416		452
Property, plant and equipment		6		5
Pension liabilities and assets		41		222
Foreign NOL carryforwards		111		101
State and local taxes, including state NOL		107		103
Tax credit carryforwards		32		92
Other		61		73
Total Gross Deferred Tax Assets		1,309		1,590
Less: valuation allowance		(151)		(1,164)
Total Net Deferred Tax Assets		1,158		426
Deferred Tax Liabilities
Property, plant and equipment		315		333
State and local taxes, including state NOL		63		20
Lease transactions		1		3
Other		133		161
Total Deferred Tax Liabilities		512		517
Net Deferred Tax Assets/(Liabilities)	$	646	$	(91)

F-42

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 13. Income Taxes —Continued

The 2013 state deferred tax assets consist of accrued expenses of $39 million, postretirement healthcare and life insurance benefits of $35 million, pension liabilities and assets of $28 million, and state net operating losses carryforward of $5 million. The 2013 state deferred tax liabilities consist of property, plant and equipment of $46 million and other deferred tax liabilities of $17 million, which includes deferred tax liabilities for indefinite-life intangible assets of $12 million.

The 2012 state deferred tax assets consist of accrued expenses of $44 million, postretirement health care and life insurance benefits of $43 million, pension liabilities and assets of $50 million, state net operating losses carryforward of $18 million, and other deferred tax assets of $7 million. The 2012 state deferred tax liabilities consist of property, plant and equipment of $59 million and other of $20 million, which includes deferred tax liabilities for indefinite-life intangible assets of $14 million. The 2012 presentation of the state deferred tax assets is a net amount of deferred tax assets of $103 million, which were subject to a full valuation allowance and net deferred liabilities of $20 million, which mainly consist of indefinite-life intangibles which were not subject to valuation allowance.

Deferred tax assets included the following tax credit and net operating loss (“NOL”) carryforwards as of December 31 (in millions of dollars):

		2013				2012
	Expiration	Deferred Tax Asset		Valuation Allowance		Deferred Tax Asset		Valuation Allowance
Tax credit carryforwards:
Canada	2014 – 2029	$	3	$	—	$	26	$	(26)
Mexico	2014 – 2015		27		(23)		56		(52)
Other Foreign	2014 – 2020		2		(2)		10		(10)
Total		$	32	$	(25)	$	92	$	(88)
NOL carryforwards:
U.S. NOLs, net	2030 – 2031	$	5	$	(3)	$	18	$	(18)
Foreign NOLs, net
Mexico	2017 – 2023		31		(31)		31		(31)
Other	2014 – 2031		9		(9)		9		(9)
	Indefinite		71		(71)		61		(61)
Total		$	116	$	(114)	$	119	$	(119)

A valuation allowance on deferred tax assets is required if, based on the available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon our ability to generate sufficient taxable income during the carryback or carryforward periods applicable in each stated tax jurisdiction. In assessing the realizability of deferred tax assets, we consider both positive and negative evidence. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence may be objectively verified. Concluding that a valuation allowance is not required is difficult when there is absence of objective and verifiable positive evidence and there is significant negative evidence which is objective and verifiable, such as cumulative losses in recent years.

Our deferred tax assets consist primarily of those of our subsidiaries in foreign jurisdictions. We have concluded that positive evidence, including achievement of sustained profitability as of December 31, 2013, outweighs our negative evidence and as a result we released a majority of our valuation allowances in respect of our net deferred tax assets as of December 31, 2013. As we have previously disclosed, our subsidiaries in foreign jurisdictions are highly dependent on our North American operations, which consists primarily of our U.S. operations. We believe we have achieved a level of sustained profitability for our U.S. operations, arising from

F-43

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 13. Income Taxes —Continued

improvements in management and business strategies since the 363 Transaction, as well as the achievement of a substantial portion of the financial and performance objectives as presented in the 2010-2014 Business Plan supported by improvements to product mix, higher international sales and the successful implementation of several new product development programs. Further, the closure of Fiat’s acquisition of the remainder of Chrysler Group’s equity on January 21, 2014, solidifies the future alliance with Fiat. Refer to Note 25Subsequent Events for further information. At December 31, 2013, our valuation allowance on net deferred tax assets was $151 million and is a decrease of $1,013 million from the prior year balance of $1,164 million.

Note 14. Commitments, Contingencies and Concentrations

Litigation

Various legal proceedings, claims and governmental investigations are pending against us on a wide range of topics, including vehicle safety; emissions and fuel economy; dealer, supplier and other contractual relationships; intellectual property rights; product warranties and environmental matters. Some of these proceedings allege defects in specific component parts or systems (including airbags, seats, seat belts, brakes, ball joints, transmissions, engines and fuel systems) in various vehicle models or allege general design defects relating to vehicle handling and stability, sudden unintended movement or crashworthiness. These proceedings seek recovery for damage to property, personal injuries or wrongful death and in some cases include a claim for exemplary or punitive damages. Adverse decisions in one or more of these proceedings could require us to pay substantial damages, or undertake service actions, recall campaigns or other costly actions.

Litigation is subject to many uncertainties, and the outcome of individual matters is not predictable with assurance. We establish an accrual in connection with pending or threatened litigation if a loss is probable and can be reasonably estimated. Since these accruals represent estimates, it is reasonably possible that the resolution of some of these matters could require us to make payments in excess of the amounts accrued. It is also reasonably possible that the resolution of some of the matters for which accruals could not be made may require us to make payments in an amount or range of amounts that could not be reasonably estimated at December 31, 2013.

The term “reasonably possible” is used herein to mean that the chance of a future transaction or event occurring is more than remote but less than likely. Although the final resolution of any such matters could have a material effect on our operating results for the particular reporting period in which an adjustment of the estimated reserve is recorded, we believe that any resulting adjustment would not materially affect our consolidated financial position or cash flows.

Environmental Matters

We are subject to potential liability under government regulations and various claims and legal actions that are pending or may be asserted against us concerning environmental matters. Estimates of future costs of such environmental matters are inevitably imprecise due to numerous uncertainties, including the enactment of new laws and regulations, the development and application of new technologies, the identification of new sites for which we may have remediation responsibility and the apportionment and collectability of remediation costs among responsible parties. We establish reserves for these environmental matters when a loss is probable and reasonably estimable. It is reasonably possible that the final resolution of some of these matters may require us to make expenditures, in excess of established reserves, over an extended period of time and in a range of amounts that cannot be reasonably estimated. Although the final resolution of any such matters could have a material

F-44

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 14. Commitments, Contingencies and Concentrations —Continued

Environmental Matters —Continued

effect on our operating results for the particular reporting period in which an adjustment to the estimated reserve is recorded, we believe that any resulting adjustment would not materially affect our consolidated financial position or cash flows.

Voluntary Service Actions and Recall Actions

We periodically initiate voluntary service and recall actions to address various customer satisfaction, safety and emissions issues related to vehicles we sell. We establish reserves for product warranty obligations, including the estimated cost of these service and recall actions, when the related sale is recognized. Refer to Note 11,Accrued Expenses and Other Liabilities, for additional information. The estimated future costs of these actions are based primarily on historical claims experience for our vehicles.

Estimates of the future costs of these actions are inevitably imprecise due to numerous uncertainties, including the enactment of new laws and regulations, the number of vehicles affected by a service or recall action and the nature of the corrective action that may result in adjustments to the established reserves. It is reasonably possible that the ultimate cost of these service and recall actions may require us to make expenditures in excess of established reserves, over an extended period of time and in a range of amounts that cannot be reasonably estimated. Although the ultimate cost of these service and recall actions could have a material effect on our operating results for the particular reporting period in which an adjustment to the estimated reserve is recorded, we believe that any such adjustment would not materially affect our consolidated financial position or cash flows.

Commercial Commitments

Certain major tier one and other automotive suppliers have short-term liquidity constraints due to the lack of available credit. In certain circumstances, we have provided financial support to such suppliers to avoid prolonged interruptions in the supply of components to us. Financial support includes, but is not limited to, parts re-pricing, debtor-in-possession loans, bridge loans, inventory financing and capital expenditure advances. In addition to parts re-pricing actions, we have recorded net charges of $34 million, $19 million and $41 million for financing support to suppliers for the years ended December 31, 2013, 2012 and 2011, respectively, which are included in Cost of Sales in the accompanying Consolidated Statements of Income.

Restricted Cash

Restricted cash, which includes cash equivalents, was $333 million at December 31, 2013. Restricted cash included $247 million held on deposit or otherwise pledged to secure our obligations under various commercial agreements guaranteed by a subsidiary of Daimler and $86 million of collateral for other contractual agreements.

Concentrations

Suppliers

Although we have not experienced any significant deterioration in our annual production volumes as a result of materials or parts shortages, we have from time to time experienced short term interruptions and variability in quarterly production schedules as a result of temporary supply constraints or disruptions in the availability of raw materials, parts and components as a result of natural disasters and other unexpected events. Additionally, we

F-45

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 14. Commitments, Contingencies and Concentrations —Continued

Concentrations —Continued

Suppliers —Continued

regularly source systems, components, parts, equipment and tooling from a sole provider or limited number of providers. Therefore, we are at risk for production delays and losses should any supplier fail to deliver goods and services on time. We continuously work with our suppliers to monitor potential supply constraints and to mitigate the effects of any emerging shortages on our production volumes and revenues. We also maintain insurance coverage for certain losses we might incur due to shortages or other supplier disruptions. During the year ended December 31, 2012, we recognized insurance recoveries totaling $76 million related to losses sustained in 2011 due to supply disruptions. These recoveries were recognized as a reduction to Cost of Sales in the accompanying Consolidated Statements of Income. The proceeds from these recoveries were fully collected as of December 31, 2012. There were no similar insurance recoveries during the years ended December 31, 2011 and 2013.

Employees

In the U.S. and Canada combined, substantially all of our hourly employees and approximately 20 percent of our salaried employees were represented by unions under collective bargaining agreements, which represented approximately 64 percent of our worldwide workforce as of December 31, 2013. The UAW and Unifor (which resulted from the merger of the CAW and the Communications, Energy and Paperworkers Union of Canada in September 2013) represent substantially all of these represented employees in the U.S. and Canada, respectively.

Other Matters

SCUSA Private-Label Financing Agreement

In February 2013, Chrysler Group entered into a private-label financing agreement with Santander Consumer USA Inc. (“SCUSA”), an affiliate of Banco Santander (the “SCUSA Agreement”). The new financing arrangement launched on May 1, 2013. Under the SCUSA Agreement, SCUSA provides a wide range of wholesale and retail financing services to our dealers and consumers in accordance with its usual and customary lending standards, under the Chrysler Capital brand name. The financing services include credit lines to finance our dealers’ acquisition of vehicles and other products that we sell or distribute, retail loans and leases to finance consumer acquisitions of new and used vehicles at our dealerships, financing for commercial and fleet customers, and ancillary services. In addition, SCUSA will work with dealers to offer them construction loans, real estate loans, working capital loans and revolving lines of credit.

Under the new financing arrangement, SCUSA has agreed to specific transition milestones for the initial year following launch. If the transition milestones are met, or otherwise satisfactory to us, the SCUSA Agreement will have a ten-year term, subject to early termination in certain circumstances, including the failure by a party to comply with certain of its ongoing obligations under the SCUSA Agreement. In accordance with the terms of the agreement, SCUSA provided us an upfront, nonrefundable payment of $150 million in May 2013, which was recognized as deferred revenue and will be amortized over ten years. As of December 31, 2013, $140 million remained in Deferred Revenue in the accompanying Consolidated Balance Sheets.

From time to time, we work with certain lenders to subsidize interest rates or cash payments at the inception of a financing arrangement to incentivize customers to purchase our vehicles, a practice known as “subvention.” We have provided SCUSA with limited exclusivity rights to participate in specified minimum percentages of certain of

F-46

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 14. Commitments, Contingencies and Concentrations —Continued

Other Matters —Continued

SCUSA Private-Label Financing Agreement  —Continued

our retail financing rate subvention programs. SCUSA has committed to certain revenue sharing arrangements, as well as to consider future revenue sharing opportunities. SCUSA bears the risk of loss on loans contemplated by the SCUSA Agreement. The parties share in any residual gains and losses in respect of consumer leases, subject to specific provisions in the SCUSA Agreement, including limitations on our participation in gains and losses.

Ally MTA

Prior to May 2011, we were a party to the Ally Master Transaction Agreement (“Ally MTA”) between the U.S. Treasury, Ally Financial Inc. (“Ally”) and U.S. Dealer Automotive Receivables Transition LLC (“USDART”). The Ally MTA provided for a risk sharing arrangement, in which USDART would reimburse Ally for qualifying losses on loans with third party Chrysler Group dealerships issued prior to November 21, 2009. In May 2011, all parties mutually agreed to terminate the Ally MTA. Under the terms of the agreement, $96 million, which represented the remaining balance of a previous advance to USDART, was transferred to us. In addition, under the terms of the U.S. Treasury first lien credit agreement, amounts outstanding under that agreement were reduced by $4 million, the amount of qualifying losses incurred by Ally through April 2011. Prior to May 2011, USDART was determined to be a VIE as it did not have sufficient equity at risk to finance its activities.

Ally Auto Finance Operating Agreement and Repurchase Obligations

In April 2013, the Auto Finance Operating Agreement between Chrysler Group and Ally, which we refer to as the “Ally Agreement”, was terminated. Notwithstanding the termination of the Ally Agreement, we anticipate that Ally will continue to provide wholesale and retail financing to our dealers and retail customers in the U.S. in accordance with its usual and customary lending standards. Our dealers and retail customers also obtain funding from other financing sources.

In accordance with the terms of the Ally Agreement, we remain obligated to repurchase Ally-financed U.S. dealer inventory that was acquired on or before April 30, 2013, upon certain triggering events and with certain exceptions, in the event of an actual or constructive termination of a dealer’s franchise agreement, including in certain circumstances when Ally forecloses on all assets of a dealer securing financing provided by Ally. These obligations exclude vehicles that have been damaged or altered, that are missing equipment or that have excessive mileage or an original invoice date that is more than one year prior to the repurchase date.

As of December 31, 2013, the maximum potential amount of future payments required to be made to Ally under this guarantee was approximately $230 million and was based on the aggregate repurchase value of eligible vehicles financed by Ally in our U.S. dealer stock. If vehicles are required to be repurchased under this arrangement, the total exposure would be reduced to the extent the vehicles can be resold to another dealer. The fair value of the guarantee was less than $0.1 million at December 31, 2013, which considers both the likelihood that the triggering events will occur and the estimated payment that would be made net of the estimated value of inventory that would be reacquired upon the occurrence of such events. The estimates are based on historical experience.

On February 1, 2013, the Canadian automotive finance business of Ally was acquired by the Royal Bank of Canada (“RBC”). Dealers with financing through Ally were offered new lending agreements with RBC, as the Ally-financing arrangements did not transfer with the sale. As such, Chrysler Group no longer has an obligation to repurchase dealer inventory in Canada that was acquired prior to February 1, 2013 and was financed by Ally.

F-47

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 14. Commitments, Contingencies and Concentrations —Continued

Other Matters —Continued

Other Repurchase Obligations

In accordance with the terms of other wholesale financing arrangements in Mexico, we are required to repurchase dealer inventory financed under these arrangements, upon certain triggering events and with certain exceptions, including in the event of an actual or constructive termination of a dealer’s franchise agreement. These obligations exclude certain vehicles including, but not limited to, vehicles that have been damaged or altered, that are missing equipment or that have excessive mileage or an original invoice date that is more than one year prior to the repurchase date.

As of December 31, 2013, the maximum potential amount of future payments required to be made in accordance with these other wholesale financing arrangements was approximately $361 million and was based on the aggregate repurchase value of eligible vehicles financed through such arrangements in the respective dealer’s stock. If vehicles are required to be repurchased through such arrangements, the total exposure would be reduced to the extent the vehicles can be resold to another dealer. The fair value of the guarantee was less than $0.1 million at December 31, 2013, which considers both the likelihood that the triggering events will occur and the estimated payment that would be made net of the estimated value of inventory that would be reacquired upon the occurrence of such events. The estimates are based on historical experience.

Arrangements with Key Suppliers

From time to time, in the ordinary course of our business, we enter into various arrangements with key suppliers in order to establish strategic and technological advantages. A limited number of these arrangements contain unconditional purchase obligations to purchase a fixed or minimum quantity of goods and/or services with fixed and determinable price provisions. Purchases under these arrangements from third parties were $222 million, $437 million and $674 million for the years ended December 31, 2013, 2012 and 2011, respectively. Future minimum purchase obligations under these arrangements as of December 31, 2013 were as follows (in millions of dollars):

2014	$	271
2015		211
2016		151
2017		85
2018		13
2019 and thereafter		30

In addition, certain of the arrangements we have entered into with Fiat contain unconditional purchase obligations to purchase a fixed or minimum quantity of goods and/or services with fixed and determinable price provisions. Purchases under these arrangements were $372 million, $383 million and $305 million for the years ended December 31, 2013, 2012 and 2011, respectively. Future minimum purchase obligations under these arrangements as of December 31, 2013 were as follows (in millions of dollars):

2014	$	4
2015		3
2016		2
2017		2
2018		—
2019 and thereafter		—

F-48

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 14. Commitments, Contingencies and Concentrations —Continued

Other Matters —Continued

Arrangements with Key Suppliers —Continued

We also enter into similar arrangements containing unconditional purchase obligations to purchase a minimum quantity of goods for which pricing is variable, and therefore do not have fixed and determinable future payment streams. Under these arrangements we are obligated to make payments or receive reimbursements if our purchase volumes are outside a specified range of values. Purchases from third parties under these arrangements were $412 million, $441 million and $346 million for the years ended December 31, 2013, 2012 and 2011, respectively. We did not have any purchases from unconsolidated related companies under these arrangements.

Lease Commitments

The majority of our lease payments are for operating leases. As of December 31, 2013, the future minimum rental commitments under operating leases with non-cancelable lease terms in excess of one year were as follows (in millions of dollars):

2014	$	137
2015		109
2016		92
2017		76
2018		55
2019 and thereafter		187

Future minimum lease commitments have not been reduced by minimum sublease rental income of $60 million due in the future under non-cancelable subleases. Rental expense under operating leases was $187 million, $174 million and $175 million for the years ended December 31, 2013, 2012 and 2011, respectively. We received sublease rentals of $21 million, $20 million and $24 million during the years ended December 31, 2013, 2012 and 2011, respectively.

F-49

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 15. Fair Value Measurements

The following summarizes our financial assets and liabilities measured at fair value on a recurring basis as of December 31 (in millions of dollars):

	2013
	Level 1		Level 2		Level 3		Total
Assets:
Cash and cash equivalents	$	12,129	$	1,215	$	—	$	13,344
Restricted cash		333		—		—		333
Derivatives:
Currency forwards and swaps		—		119		—		119
Commodity swaps and options		—		8		6		14
Total	$	12,462	$	1,342	$	6	$	13,810
Liabilities:
Derivatives:
Currency forwards and swaps	$	—	$	15	$	—	$	15
Commodity swaps and options		—		11		3		14
Total	$	—	$	26	$	3	$	29

	2012
	Level 1		Level 2		Level 3		Total
Assets:
Cash and cash equivalents	$	10,685	$	929	$	—	$	11,614
Restricted cash		371		—		—		371
Derivatives:
Currency forwards and swaps		—		6		—		6
Commodity swaps		—		18		12		30
Total	$	11,056	$	953	$	12	$	12,021
Liabilities:
Derivatives:
Currency forwards and swaps	$	—	$	44	$	—	$	44
Commodity swaps		—		8		3		11
Total	$	—	$	52	$	3	$	55

During the years ended December 31, 2013 and 2012, there were no transfers between Level 1 and Level 2 or into or out of Level 3.

We enter into over-the-counter currency forward and swap contracts to manage our exposure to risk relating to changes in foreign currency exchange rates. We estimate the fair value of currency forward and swap contracts by discounting future net cash flows derived from market-based expectations for exchange rates to a single present value.

We enter into over-the-counter commodity swaps and options to manage our exposure to risk relating to changes in market prices of various commodities. Swap contracts are fair valued by discounting future net cash flows derived from market-based expectations for commodity prices to a single present value. Options contracts are fair

F-50

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 15. Fair Value Measurements —Continued

valued using variations of the Black Scholes option pricing model. For certain commodities within our portfolio, market-based expectations of these prices are less observable, and alternative sources are used to develop these inputs. We have classified these commodity swaps as Level 3 within the fair value hierarchy.

We take into consideration credit valuation adjustments on both assets and liabilities taking into account credit risk of our counterparties and non-performance risk as described in Note 16,Derivative Financial Instruments and Risk Management.

The following summarizes the changes in Level 3 items measured at fair value on a recurring basis (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Derivatives Assets (Liabilities):
Balance at beginning of the period	$	9	$	(35)	$	41
Total realized and unrealized gains (losses):
Included in Net Income (Loss) (1)		8		(30)		39
Included in Other Comprehensive Income (Loss)(2)		(3)		45		(83)
Settlements (3)		(11)		29		(32)
Transfers into Level 3		—		—		—
Transfers out of Level 3		—		—		—
Fair value at end of the period	$	3	$	9	$	(35)
Changes in unrealized losses relating to instruments held at end of period (1)	$	—	$	—	$	—

(1) The related realized and unrealized gains (losses) are recognized in Cost of Sales in the accompanying Consolidated Statements of Income.

(2) The related realized and unrealized gains (losses) are recognized in Derivatives, net in the accompanying Consolidated Statements of Comprehensive Income (Loss).

(3) There were no purchases, issuances or sales during the years ended December 31, 2013, 2012 and 2011.

The following summarizes the unobservable inputs related to Level 3 items measured at fair value on a recurring basis as of December 31, 2013:

	Net Asset (in millions of dollars)		Valuation Technique		Unobservable Input	Range		Unit of Measure
Commodity swaps	$	3		Discounted	Platinum forward points		$  0.27 — $10.02	Per troy ounce
				cash flow	Palladium forward points		$  0.15 — $  5.31	Per troy ounce
					Natural gas forward points		$(0.15) — $  0.29	Per giga-joule

The forward points that were used in the valuation of platinum, palladium and certain natural gas contracts were deemed unobservable. Significant increases or decreases in any of the unobservable inputs in isolation would not significantly impact our fair value measurements.

F-51

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 15. Fair Value Measurements —Continued

The carrying amounts and estimated fair values of our financial instruments as of December 31 were as follows (in millions of dollars):

	2013				2012
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Cash and cash equivalents	$	13,344	$	13,344	$	11,614	$	11,614
Restricted cash		333		333		371		371
Financial liabilities(1)		12,301		13,407		12,603		13,643
Derivatives:
Included in Prepaid Expenses and Other Assets and Advances to Related Parties and Other Financial Assets		133		133		36		36
Included in Accrued Expenses and Other Liabilities		29		29		55		55

(1) The fair value of financial liabilities includes $6.5 billion measured utilizing Level 2 inputs and $6.9 billion measured utilizing Level 3 inputs at December 31, 2013.

The estimated fair values have been determined by using available market information and valuation methodologies as described below. Considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that we could realize in a current market exchange. The use of different market assumptions or valuation methodologies may have a material effect on the estimated fair values.

The methods and assumptions used to estimate the fair value of financial instruments are consistent with the definition presented in the accounting guidance for fair value measurements and are as follows:

Cash and cash equivalents, including restricted cash

The carrying value of cash and cash equivalents approximates fair value due to the short maturity of these instruments and consists primarily of money market funds, certificates of deposit, commercial paper, time deposits and bankers’ acceptances.

Financial liabilities

We estimate the fair values of our financial liabilities using quoted market prices where available. Where market prices are not available, we estimate fair value by discounting future cash flows using market interest rates, adjusted for non-performance risk over the remaining term of the financial liability.

Derivative instruments

The fair value of derivative instruments are based on pricing models or formulas using current estimated cash flow and discount rate assumptions.

F-52

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 16. Derivative Financial Instruments and Risk Management

Derivative instruments

All derivative instruments are recognized in the accompanying Consolidated Balance Sheets at fair value. We do not net our derivative position by counterparty for purposes of balance sheet presentation and disclosure. The fair values of our derivative financial instruments are based on pricing models or formulas using current estimated cash flow and discount rate assumptions. We include an adjustment for non-performance risk in the recognized measure of fair value of derivative instruments. The adjustment is estimated based on the net exposure by counterparty. We use an estimate of the counterparty’s non-performance risk when we are in a net asset position and an estimate of our own non-performance risk when we are in a net liability position. As of December 31, 2013 and 2012, the adjustment for non-performance risk did not materially impact the fair value of derivative instruments.

The use of derivatives exposes us to the risk that a counterparty may default on a derivative contract. We establish exposure limits for each counterparty to minimize this risk and provide counterparty diversification. Substantially all of our derivative exposures are with counterparties that have long-term credit ratings of single–A or better. The aggregate fair value of derivative instruments in asset positions as of December 31, 2013 and 2012 was $133 million and $36 million, respectively, representing the maximum loss that we would recognize at that date if all counterparties failed to perform as contracted. We enter into master agreements with counterparties that generally allow for netting of certain exposures; therefore, the actual loss that we would recognize if all counterparties failed to perform as contracted could be significantly lower.

The terms of the agreements with our counterparties for foreign currency exchange and commodity hedge contracts require us to post collateral when derivative instruments are in a liability position, subject to posting thresholds. In addition, these agreements contain cross-default provisions that, if triggered, would permit the counterparty to declare a default and require settlement of the outstanding net asset or liability positions. These cross-default provisions could be triggered if there was a non-performance event under certain debt obligations. The fair value of the related gross liability positions as of December 31, 2013 and 2012, which represent our maximum potential exposure, were $29 million and $55 million, respectively. As of December 31, 2012, we posted $24 million as collateral for foreign exchange and commodity hedge contracts that were outstanding at year end. Per the terms of our agreements, no collateral was required to be posted as of December 31, 2013.

The following presents the gross and net amounts of our derivative assets and liabilities after giving consideration to the terms of the master netting arrangements with our counterparties as of December 31 (in millions of dollars):

	2013				2012
	Derivative Assets		Derivative Liabilities		Derivative Assets		Derivative Liabilities
Gross amounts recognized in the Consolidated Balance Sheets	$	133	$	29	$	36	$	55
Gross amounts not offset in the Consolidated Balance Sheets that are eligible for offsetting
Derivatives		(24)		(24)		(24)		(24)
Cash collateral pledged		—		—		—		(24)
Net Amount	$	109	$	5	$	12	$	7

F-53

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 16. Derivative Financial Instruments and Risk Management —Continued

Derivative instruments —Continued

The notional amounts of the derivative financial instruments do not necessarily represent amounts exchanged by the parties and, therefore, are not a direct measure of our exposure to the financial risks described above. The amounts exchanged are calculated by reference to the notional amounts and by other terms of the derivative instruments, such as foreign currency exchange rates or commodity volumes and prices.

Cash Flow Hedges

We use financial instruments designated as cash flow hedges to hedge exposure to foreign currency exchange risk associated with transactions in currencies other than the functional currency in which we operate. We also use financial instruments designated as cash flow hedges to hedge our exposure to commodity price risk associated with buying certain commodities used in the ordinary course of our operations.

Changes in the fair value of designated derivatives that are highly effective as cash flow hedges are recorded in AOCI, net of estimated income taxes. These changes in the fair value are then released into earnings contemporaneously with the earnings effects of the hedged items. Cash flows associated with cash flow hedges are reported in Net Cash Provided by Operating Activities in the accompanying Consolidated Statements of Cash Flows. The ineffective portions of the fair value changes are recognized in the results of operations immediately. The amount of ineffectiveness recorded for the years ended December 31, 2013 and 2012 was immaterial. Our cash flow hedges mature within 17 months.

We discontinue hedge accounting prospectively and hold amounts in AOCI with future changes in fair value recorded directly in earnings when (i) it is determined that a derivative is no longer highly effective in offsetting changes in cash flows of a hedged item; (ii) the derivative is discontinued as a hedge instrument because it is not probable that a forecasted transaction will occur or (iii) the derivative expires or is sold, terminated or exercised. Those amounts held in AOCI are subsequently reclassified into income over the same period or periods during which the forecasted transaction affects income. When hedge accounting is discontinued because it is determined that the forecasted transactions will not occur, the derivative continues to be carried on the balance sheet at fair value, and gains and losses that were recorded in AOCI are recognized immediately in earnings. The hedged item may be designated prospectively into a new hedging relationship with another derivative instrument.

The following summarizes the fair values of derivative instruments designated as cash flow hedges which were outstanding as of December 31 (in millions of dollars):

	2013
	Notional Amounts		Derivative Assets (1)		Derivative Liabilities (2)
Currency forwards and swaps	$	2,494	$	107	$	(12)
Commodity swaps		212		9		(3)
Total	$	2,706	$	116	$	(15)

F-54

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 16. Derivative Financial Instruments and Risk Management —Continued

Cash Flow Hedges —Continued

	2012
	Notional Amounts		Derivative Assets (1)		Derivative Liabilities (2)
Currency forwards and swaps	$	3,369	$	4	$	(43)
Commodity swaps		223		13		(8)
Total	$	3,592	$	17	$	(51)

(1) The related derivative instruments are recognized in Prepaid Expenses and Other Assets and Advances to Related Parties and Other Financial Assets in the accompanying Consolidated Balance Sheets.

(2) The related derivative instruments are recognized in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets.

The following summarizes the pre-tax effect of gains (losses) recorded in other comprehensive income (loss) and reclassified from AOCI to income (in millions of dollars):

	Year Ended December 31, 2013
	AOCI as of January 1, 2013		Gain (Loss) Recorded in OCI		Gain (Loss) reclassified from AOCI to Income		AOCI as of December 31, 2013
Currency forwards and swaps	$	(40)	$	230	$	84	$	106
Commodity swaps		4		7		3		8
Total	$	(36)	$	237	$	87	$	114
	Year Ended December 31, 2012
	AOCI as of January 1, 2012		Gain (Loss) Recorded in OCI		Gain (Loss) reclassified from AOCI to Income		AOCI as of December 31, 2012
Currency forwards and swaps	$	57	$	(103)	$	(6)	$	(40)
Commodity swaps		(51)		11		(44)		4
Total	$	6	$	(92)	$	(50)	$	(36)
	Year Ended December 31, 2011
	AOCI as of January 1, 2011		Gain (Loss) Recorded in OCI		Gain (Loss) reclassified from AOCI to Income		AOCI as of December 31, 2011
Currency forwards and swaps	$	(74)	$	35	$	(96)	$	57
Commodity swaps		42		(62)		31		(51)
Total	$	(32)	$	(27)	$	(65)	$	6

We expect to reclassify existing pre-tax net gains of $112 million from AOCI to income within the next 12 months.

F-55

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 16. Derivative Financial Instruments and Risk Management —Continued

Derivatives Not Designated as Hedges

Some derivatives do not qualify for hedge accounting; for others, we elect not to apply hedge accounting. We use derivatives to economically hedge our financial and operational exposures. Unrealized and realized gains and losses related to derivatives that are not designated as accounting hedges are included in Revenues, Net or Cost of Sales in the accompanying Consolidated Statements of Income as appropriate depending on the nature of the risk being hedged. Cash flows associated with derivatives that are not designated as hedges are reported in Net Cash Provided by Operating Activities in the accompanying Consolidated Statements of Cash Flows.

The following summarizes the fair values of derivative instruments not designated as hedges as of December 31 (in millions of dollars):

	2013
	Notional Amounts		Derivative Assets (1)		Derivative Liabilities (2)
Currency forwards and swaps	$	427	$	12	$	(3)
Commodity swaps and options		396		5		(11)
Total	$	823	$	17	$	(14)

	2012
	Notional Amounts		Derivative Assets (1)		Derivative Liabilities (2)
Currency forwards and swaps	$	324	$	2	$	(1)
Commodity swaps		399		17		(3)
Total	$	723	$	19	$	(4)

(1) The related derivative instruments are recognized in Prepaid Expenses and Other Assets and Advances to Related Parties and Other Financial Assets in the accompanying Consolidated Balance Sheets.

(2) The related derivative instruments are recognized in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets.

The following summarizes the effect of derivative instruments not designated as hedges in the respective financial statement captions of the accompanying Consolidated Statements of Income (in millions of dollars):

		Years Ended December 31,
	Financial Statement Caption	2013		2012		2011
		Gain (Loss)		Gain (Loss)		Gain (Loss)
Currency forwards and swaps	Revenues, Net	$	43	$	(13)	$	4
Commodity swaps and options	Cost of Sales		(60)		7		(105)
Interest rate swaps	Cost of Sales		—		—		1
Total		$	(17)	$	(6)	$	(100)

F-56

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 17. Share-Based Compensation

We have awards outstanding under four share-based compensation plans: the Chrysler Group LLC Restricted Stock Unit Plan (“RSU Plan”), the Amended and Restated Chrysler Group LLC Directors’ Restricted Stock Unit Plan, (“Directors’ RSU Plan”), the Chrysler Group LLC Deferred Phantom Share Plan (“DPS Plan”) and the Chrysler Group LLC 2012 Long Term Incentive Plan (“2012 LTIP Plan”).

The fair value of each unit issued under the plans is based on the fair value of our membership interests. Each unit represents a “Chrysler Group Unit,” which is equal to 1/600th of the value of a Class A Membership Interest. Since there is no publicly observable trading price for our membership interests, fair value was determined using a discounted cash flow methodology. This approach, which is based on projected cash flows, is used to estimate our enterprise value. The fair value of our outstanding interest bearing debt as of the measurement date is deducted from our enterprise value to arrive at the fair value of equity. This amount is then divided by the total number of Chrysler Group Units, as determined above, to estimate the fair value of a single Chrysler Group Unit.

The significant assumptions used in the contemporaneous calculation of fair value at each issuance date and for each period included the following:

• Four years of annual projections prepared by management that reflect the estimated after-tax cash flows a market participant would expect to generate from operating the business;

• A terminal value which was determined using a growth model that applied a 2.0 percent long-term growth rate to our projected after-tax cash flows beyond the four year window. The long-term growth rate was based on our internal projections, as well as industry growth prospects;

• An estimated after-tax weighted average cost of capital ranging from 16.0 percent to 16.5 percent in both 2013 and 2012, and 14.4 percent to 16.5 percent in 2011; and

• Projected worldwide factory shipments ranging from approximately 2.4 million vehicles in 2012 to approximately 3.3 million vehicles in 2017.

In 2011, the implied fair value of the Company, resulting from the transactions through which Fiat acquired beneficial ownership of the membership interests previously held by the U.S. Treasury and Canadian Government, was used to corroborate the values determined using the discounted cash flow methodology. There were no such transactions during 2012 and 2013. On January 21, 2014, Fiat acquired the VEBA Trust’s remaining membership interest in Chrysler Group. Refer to Note 25,Subsequent Events, for additional information. The implied fair value of the Company resulting from this transaction, along with certain other factors, was used to corroborate the fair value determined at December 31, 2013 using our discounted cash flow methodology.

Based on the discounted cash flow methodology, the per unit fair value of a Chrysler Group Unit, calculated based on the Chrysler Group Units of 980 million, was $10.47, $9.00 and $7.63 at December 31, 2013, 2012 and 2011, respectively. All per unit fair values include a discount for lack of marketability of 10 percent.

As of December 31, 2013, 29,400,000 units are authorized to be granted for the RSU Plan, Director RSU Plan and 2012 LTIP Plan. There is no limit on the number of Phantom Shares authorized under the DPS Plan. Upon adoption of the 2012 LTIP Plan, we agreed to cease making further grants under the RSU Plan and DPS Plan. The plans are described in more detail below.

F-57

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 17. Share-Based Compensation —Continued

Anti-Dilution Adjustment

The documents governing our share-based compensation plans contain anti-dilution provisions which provide for an adjustment to the number of Chrysler Group Units granted under the plans in order to preserve, or alternatively prevent the enlargement of, the benefits intended to be made available to the holders of the awards should an event occur that impacts our capital structure.

As of December 31, 2013, there are no Class B Membership Interests issued and outstanding. The method by which the Class B Membership Interests were converted into Class A Membership Interests required that the Class B Membership Interests represent a portion of the total Class A Membership Interests equal to the aggregate Class B Membership Interests immediately prior to such conversion.

The calculated number of Chrysler Group Units was originally determined by converting the Class B Membership Interests into Class A Membership Interests assuming they represented a 20 percent aggregate ownership interest in the Company. The following details the original conversion calculation:

Membership Interests	Authorized, issued and outstanding as of June 10, 2009 (prior to conversion)		Percentage Ownership Interest as of June 10, 2009 (prior to conversion)		Calculated authorized, issued and outstanding (post conversion)
Class A		800,000		80%		1,000,000 (1)
Class B		200,000		20%		—
Total Class A Membership Interests						1,000,000
Total Chrysler Group Units (Class A * 600)						600,000,000

(1) 800,000 / 80% = 1,000,000

During 2011, we achieved two of the Class B Events described in our governance documents and Fiat exercised its incremental equity call option. In each case, Fiat’s ownership interest in the Company increased through the dilution of the outstanding Class A Membership Interests and consequently, the value of a Chrysler Group Unit. Refer to Note 19,Other Transactions with Related Parties, for additional information regarding these events. In addition, in July 2011 Fiat acquired all of the Class A Membership Interests in the Company previously held by the U.S. Treasury and the Canadian Government. This did not impact the anti-dilution adjustment calculation. Therefore, in September 2011, and in accordance with the terms of our share-based compensation plans, the number of Chrysler Group Units authorized and granted was adjusted to preserve the economic value of the awards previously granted in order to offset the dilutive effect of changes in Fiat’s ownership interests. At the time the adjustment was made, the Class B Membership Interests represented a 30 percent aggregate ownership interest in the Company. However, we determined that it would be appropriate to convert the Class B Membership Interests into Class A Membership Interests assuming they represented a 35 percent aggregate ownership interest in the Company, which took into consideration our achievement of the third and final Class B Event, which occurred in January 2012. While the third and final Class B Event had not yet been achieved at the time the adjustment was made, we determined that it was probable that it would be achieved in the near term, and that upon achievement, it would further dilute the outstanding Class A Membership Interests.

F-58

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 17. Share-Based Compensation —Continued

Anti-Dilution Adjustment —Continued

The following details the effect of these changes on the calculation of the total number of Chrysler Group Units:

Membership Interests	Authorized, issued and outstanding as of August 31, 2011 (prior to conversion)		Percentage Ownership Interest as of August 31, 2011 (prior to conversion)		Calculated authorized, issued and outstanding (post conversion)
Class A		1,061,225		65%		1,632,654 (1)
Class B		200,000		35%		—
Total Class A Membership Interests						1,632,654
Total Chrysler Group Units (Class A * 600)						979,592,400

(1) 1,061,225 / 65% = 1,632,654

No other changes to any of the other terms of the awards issued under our share-based compensation plans were made in 2011. Further, as the value of the awards immediately prior to and after the adjustment was unchanged, no additional compensation expense was recognized as a result of this modification during 2011.

There were no further capital structure changes in 2013 and 2012 that required an anti-dilution adjustment.

2012 Long Term Incentive Plan

In February 2012, the Compensation and Leadership Development Committee (“Compensation Committee”) approved the 2012 LTIP Plan that covers our senior executives, other than our Chief Executive Officer. The 2012 LTIP Plan is designed to retain talented professionals and reward their performance through annual grants of phantom equity in the form of restricted share units (“LTIP RSUs”), and performance share units (“LTIP PSUs”). LTIP RSUs may be granted annually, while LTIP PSUs are generally granted at the beginning of a three-year performance period. In addition, under the terms of the plan, the Compensation Committee has authority to grant additional LTIP PSU awards during the three-year performance period. The LTIP RSUs will vest over three years in one-third increments on the anniversary of their grant date, while the LTIP PSUs will vest at the end of the three-year performance period only if we meet or exceed certain three-year cumulative financial performance targets, which are consistent with those used in our incentive compensation calculations for our non-represented employees. Concurrent with the adoption of the 2012 LTIP Plan, the Compensation Committee established financial performance targets for the three-year performance period, ending December 31, 2014. If we do not fully achieve these targets, the LTIP PSUs will be deemed forfeited. LTIP RSUs and LTIP PSUs represent a contractual right to receive a payment in an amount equal to the fair value of one Chrysler Group Unit, as defined above.

Once vested, LTIP RSUs and LTIP PSUs will be settled in cash or, in the event we complete an initial public offering (“IPO”) of equity securities, the Compensation Committee has the discretion to settle the awards in cash or shares of Chrysler Group’s publicly traded stock. Settlement will be made as soon as practicable after vesting, but in any case no later than March 15th of the year following vesting. Vesting of the LTIP RSUs and LTIP PSUs may be accelerated in certain circumstances, including upon the participant’s death, disability or in the event of a change of control.

F-59

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 17. Share-Based Compensation —Continued

2012 Long Term Incentive Plan —Continued

During the year ended December 31, 2013, we granted 587,091 LTIP PSUs and 1,628,822 LTIP RSUs under our 2012 LTIP Plan. During the year ended December 31, 2012, we granted 8,450,275 LTIP PSUs and 1,835,833 LTIP RSUs under the plan. These liability-classified awards are included in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets.

During the years ended December 31, 2013 and 2012, compensation expense of approximately $48 million and $31 million, respectively, was recognized for the 2012 LTIP Plan. The corresponding tax benefit in all periods was insignificant. Total unrecognized compensation expense at December 31, 2013 was approximately $44 million. Expense will be recognized over the remaining service periods based upon our assessment of the performance conditions being achieved. Payments under this plan were approximately $5 million during the year ended December 31, 2013. Payments made during the year ended December 31, 2012, in respect of these awards were not material.

The following summarizes the activity related to the 2012 LTIP Plan awards issued to our employees:

	Year Ended December 31, 2013
	LTIP RSU		Weighted Average Grant Date Fair Value		LTIP PSU		Weighted Average Grant Date Fair Value
Non-vested at beginning of period		1,805,123		7.63		8,419,684		7.63
Granted		1,628,822		9.00		587,091		9.33
Vested		(615,315)		7.65		—		—
Forfeited		(120,423)		8.22		(589,264)		7.64
Non-vested at end of period		2,698,207		8.43		8,417,511		7.75

	Year Ended December 31, 2012
	LTIP RSU		Weighted Average Grant Date Fair Value		LTIP PSU		Weighted Average Grant Date Fair Value
Non-vested at beginning of period		—		—		—		—
Granted		1,835,833		7.63		8,450,275		7.63
Vested		(20,123)		7.63		—		—
Forfeited		(10,587)		7.63		(30,591)		7.63
Non-vested at end of period		1,805,123		7.63		8,419,684		7.63

Restricted Stock Unit Plans

RSU Plan

There were no awards issued under our RSU Plan during 2013. During the years ended December 31, 2012 and 2011, 1,266,267 RSUs and 2,749,696 RSUs, respectively, were granted under this plan. RSUs represent a contractual right to receive a payment in an amount equal to the fair value of one Chrysler Group Unit, as defined above.

F-60

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 17. Share-Based Compensation —Continued

Restricted Stock Unit Plans —Continued

RSU Plan —Continued

Originally, RSUs granted to employees in 2009 and 2010 vested in two tranches. In the first tranche, representing 25 percent of the RSUs, vesting occurred if the participant was continuously employed through the third anniversary of the grant date, and the Modified Earnings Before Interest, Taxes, Depreciation and Amortization (“Modified EBITDA”) threshold for 2010 was achieved. The 2010 Modified EBITDA target was achieved. In the second tranche, representing 75 percent of the RSUs, vesting occurred at the later of (i) the participant’s continuous employment through the third anniversary of the grant date and (ii) the date that we complete an IPO. Settlement of the 2009 and 2010 awards was initially contingent upon our repayment of a minimum of 25 percent of our outstanding U.S. Treasury debt obligations, which were fully repaid in May 2011.

In September 2012, our Compensation Committee approved a modification to the second tranche of RSUs. The modification removed the performance condition requiring an IPO to occur prior to the award vesting. Prior to this modification, the second tranche of the 2009 and 2010 RSUs were equity-classified awards. In connection with the modification of these awards, we determined that it was no longer probable that the awards would be settled with company stock. In September 2012, we reclassified the second tranche of the 2009 and 2010 RSUs from equity-classified awards to liability-classified awards. As a result of this modification, additional compensation expense of $16 million was recognized during 2012.

For RSUs granted to employees in 2011 and 2012, vesting occurs if the participant is continuously employed through the third anniversary of the grant date.

As of December 31, 2013, all RSUs are included in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets. The settlement of these awards will be in cash. However, if the Company were to complete an IPO, the awards may be settled in company stock and would then be accounted for as a modification from a liability-classified award to an equity-classified award.

Directors’ RSU Plan

In April 2012, the Compensation Committee amended and restated the Chrysler Group LLC 2009 Directors’ Restricted Stock Unit Plan to allow grants having a one year vesting term to be granted on an annual basis. Director RSUs are granted to our non-employee members of our Board of Directors. Prior to the change, Director RSUs were granted at the beginning of a three-year performance period and vested in three equal tranches on the first, second, and third anniversary of the date of grant, subject to the participant remaining a member of our Board of Directors on each vesting date.

During the years ended December 31, 2013, 2012 and 2011, we granted 161,290 RSUs, 200,256 RSUs and 50,140 RSUs under our Directors’ RSU Plan, respectively. Awards issued and outstanding under this plan as of December 31, 2013 will vest in June 2014. These liability-classified awards are included in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets. Settlement of the awards will be made within 60 days of the director’s cessation of service on our Board and will be paid in cash. However, if we were to complete an IPO, the awards may be settled in stock and would then be accounted for as a modification from a liability-classified award to an equity-classified award.

F-61

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 17. Share-Based Compensation —Continued

Restricted Stock Unit Plans —Continued

Directors’ RSU Plan —Continued

During the years ended December 31, 2013, 2012 and 2011, compensation expense of $19 million, $36 million and $18 million, respectively was recognized in total for both of the RSU plans. Compensation expense for the year ended December 31, 2012, includes the additional expense recognized in connection with the modification that occurred in September 2012. The corresponding tax benefit in all periods was insignificant. Total unrecognized compensation expense at December 31, 2013 for both of the RSU plans was $5 million and will be recognized over the remaining service periods. Payments under these plans were $27 million, $4 million and $6 million during the years ended December 31, 2013, 2012 and 2011, respectively.

The following summarizes the activity related to RSUs issued to our employees and non-employee directors:

	Years Ended December 31,
	2013				2012				2011
	Restricted Stock Units		Weighted Average Grant Date Fair Value		Restricted Stock Units		Weighted Average Grant Date Fair Value		Restricted Stock Units		Weighted Average Grant Date Fair Value
Non-vested at beginning of period		4,735,442	$	5.73		5,952,331	$	3.25		5,220,692	$	1.20
Granted		161,290		9.92		1,466,523		7.68		2,799,836		5.76
Vested		(977,573)		3.46		(2,586,060)		1.22		(1,331,943)		1.20
Forfeited		(225,403)		6.96		(97,352)		6.14		(736,254)		1.99
Non-vested at end of period		3,693,756		6.49		4,735,442		5.73		5,952,331		3.25

Deferred Phantom Shares Plan

Under the DPS Plan, phantom shares of the Company (“Phantom Shares”) were granted to certain key employees and to our Chief Executive Officer for his service as a member of our Board of Directors and vested immediately on the grant date and will be settled in cash. The Phantom Shares are redeemable in three equal annual installments. Phantom Shares represent a contractual right to receive a payment in an amount equal to the fair value of one Chrysler Group Unit, as defined above. During the years ended December 31, 2013, 2012 and 2011, compensation expense of $1 million, $3 million and $18 million, respectively, was recognized for the DPS Plan. The corresponding tax benefit was insignificant in all periods. During the years ended December 31, 2013 and 2012, payments of $12 million and $27 million, respectively, were made under this plan. No payments were made during the year ended December 31, 2011.

These liability-classified awards are included in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets.

F-62

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 17. Share-Based Compensation —Continued

Deferred Phantom Shares Plan —Continued

The following summarizes the activity related to the Phantom Shares issued:

	Years Ended December 31,
	2013				2012				2011
	Deferred Phantom Shares		Weighted Average Grant Date Fair Value		Deferred Phantom Shares		Weighted Average Grant Date Fair Value		Deferred Phantom Shares		Weighted Average Grant Date Fair Value
Outstanding at beginning of period		1,508,785	$	3.54		4,944,476	$	2.37		3,988,292	$	1.44
Granted and vested		—		—		—		—		956,184		6.23
Settled		(1,190,054)		2.82		(3,435,691)		1.85		—		—
Outstanding at end of period		318,731		6.22		1,508,785		3.54		4,944,476		2.37

Note 18. Employee Retirement and Other Benefits

We sponsor both noncontributory and contributory defined benefit pension plans. The majority of the plans are funded plans. The noncontributory pension plans cover certain of our hourly and salaried employees. Benefits are based on a fixed rate for each year of service. Additionally, contributory benefits are provided to certain of our salaried employees under the salaried employees’ retirement plans. These plans provide benefits based on the employee’s cumulative contributions, years of service during which the employee contributions were made and the employee’s average salary during the five consecutive years in which the employee’s salary was highest in the 15 years preceding retirement.

We provide health care, legal and life insurance benefits to certain of our hourly and salaried employees. Upon retirement from the Company, employees may become eligible for continuation of certain benefits. Benefits and eligibility rules may be modified periodically.

We also sponsor defined contribution plans for certain of our hourly and salaried employees. During the years ended December 31, 2013, 2012 and 2011, contribution expense related to these plans was $60 million, $32 million and $13 million, respectively.

Plan Amendments to U.S. and Canada Salaried Defined Benefit Pension Plans

During the second quarter of 2013, we amended our U.S. and Canadian salaried defined benefit pension plans. The U.S. plans were amended in order to comply with Internal Revenue Service regulations, cease the accrual of future benefits effective December 31, 2013, and enhance the retirement factors. The Canada amendment ceases the accrual of future benefits effective December 31, 2014, enhances the retirement factors and continues to consider future salary increases for the affected employees.

F-63

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Plan Amendments to U.S. and Canada Salaried Defined Benefit Pension Plans —Continued

The following summarizes the effects of the interim remeasurement, curtailment gain and plan amendments as a result of the changes to the plans recognized during the year ended December 31, 2013 (in millions of dollars):

	Remeasurement		Curtailment Gain and Plan Amendments		Total
		Increase (Decrease)
Prepaid pension expense (included in Prepaid Expenses and Other Assets)	$	(9)	$	—	$	(9)
Net pension benefit obligation (included in Accrued Expenses and Other Liabilities)		(562)		(218)		(780)
Actuarial and curtailment gains included in AOCI		553		316		869
Prior service cost included in AOCI		—		(98)		(98)

Termination of Legal Services Plan

In accordance with the 2011 UAW collective bargaining agreement provisions, a plan which provided legal services as a postretirement benefit to our UAW represented employees and retirees was terminated effective December 31, 2013. Accordingly, we recognized a $91 million negative plan amendment on December 31, 2011, which resulted in negative prior service cost which was recorded in AOCI and was fully amortized into Selling, Administrative and Other Expenses as of December 31, 2013.

Transfer of VEBA Trust Assets and Obligations to the UAW Retiree Medical Benefits Trust

In connection with the VEBA Settlement Agreement, we created the UAW Postretirement Health Care Plan, which was responsible for paying all postretirement health care claims incurred by our UAW vested retirees from June 10, 2009 through January 1, 2010. On January 1, 2010, the VEBA Trust assumed responsibility for all claims incurred by our UAW retirees subsequent to January 1, 2010, with the exception of claims incurred by retirees who participated in an early retirement program offered by Old Carco during the period from April 28, 2009 through May 25, 2009 (“Window Period”). For these individuals, we had an obligation to pay all claims incurred for 24 months from the date the individual retired. Refer to Note 12,Financial Liabilities, for additional information regarding the VEBA Settlement Agreement.

On January 1, 2010, and in accordance with the terms of the VEBA Settlement Agreement, we transferred plan assets to the VEBA Trust and thereby were discharged of benefit obligations related to postretirement healthcare for certain UAW retirees. As a result of this settlement, we derecognized the associated other postretirement benefits (“OPEB”) obligation and we recognized a financial liability for the VEBA Trust Note at fair value.

As of May 2011, the VEBA Trust assumed responsibility for all claims incurred by the retirees who participated in an early retirement program during the Window Period. As a result of actual claims being less than anticipated and as there was no remaining obligation related to this program we recognized a gain of $21 million during the year ended December 31, 2011.

F-64

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Benefit Obligations and Related Plan Assets

The following summarizes the changes in benefit obligations and related plan assets, as well as the status of the plans (in millions of dollars):

	Years Ended December 31,
	2013				2012
	Pension Benefits		OPEB		Pension Benefits		OPEB
Change in benefit obligations:
Benefit obligations at beginning of period	$	34,837	$	3,073	$	31,980	$	2,729
Service cost		368		30		324		24
Interest cost		1,343		120		1,514		135
Employee contributions		10		—		10		—
Amendments and benefit changes		(218)		(1)		25		(7)
Remeasurement effect related to curtailment and plan amendment		(570)		—		—		—
Actuarial (gain) loss		61		(12)		(98)		68
Discount rate change		(2,135)		(281)		3,174		299
Benefits paid		(2,191)		(172)		(2,262)		(189)
Special early retirement programs		1		—		1		—
Other, primarily currency translation		(400)		(33)		169		14
Benefit obligations at end of period	$	31,106	$	2,724	$	34,837	$	3,073
Change in plan assets:
Fair value of plan assets at beginning of period	$	25,972	$	—	$	25,444	$	—
Actual return on plan assets		1,640		—		2,378		—
Employee contributions		10		—		10		—
Company contributions —to pension trust		552		—		237		—
Company contributions —directly to pay benefits		32		172		17		189
Amendments and benefit changes		—		—		17		—
Remeasurement effect related to curtailment and plan amendment		(17)		—		—		—
Benefits paid		(2,191)		(172)		(2,262)		(189)
Other, primarily currency translation		(344)		—		131		—
Fair value of plan assets at end of period	$	25,654	$	—	$	25,972	$	—
Funded status of plans	$	(5,452)	$	(2,724)	$	(8,865)	$	(3,073)
Amounts recognized on the balance sheet:
Prepaid expense and other assets	$	137	$	—	$	114	$	—
Current liabilities		(11)		(176)		(1)		(187)
Long-term liabilities		(5,578)		(2,548)		(8,978)		(2,886)
Total	$	(5,452)	$	(2,724)	$	(8,865)	$	(3,073)
Amounts recognized in accumulated other comprehensive loss:
Unrealized actuarial net loss and other	$	(3,529)	$	(527)	$	(6,378)	$	(854)
Unrealized prior service (cost) credit		(103)		10		(10)		52
Total	$	(3,632)	$	(517)	$	(6,388)	$	(802)
Accumulated benefit obligation (“ABO”) at December 31	$	31,049			$	34,432
Pension plans in which ABO exceeds plan assets at December 31:
ABO	$	25,715			$	33,938
Fair value of plan assets		20,160				25,363
Pension plans in which projected benefit obligation (“PBO”) exceeds plan assets at December 31:
PBO	$	25,749			$	34,343
Fair value of plan assets		20,160				25,363

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Benefit Costs and Other Changes in Plan Assets and Benefit Obligations Recognized in AOCI

The components of benefit cost and other changes in plan assets and benefit obligations recognized in AOCI were as follows (in millions of dollars):

	Years Ended December 31,
	2013				2012				2011
	Pension Benefits		OPEB		Pension Benefits		OPEB		Pension Benefits		OPEB
Net periodic benefit cost:
Service cost	$	368	$	30	$	324	$	24	$	263	$	21
Interest cost		1,343		120		1,514		135		1,525		141
Expected return on plan assets		(1,843)		—		(1,811)		—		(1,828)		—
Recognition of net actuarial losses		271		47		101		26		—		13
Amortization of prior service cost (credit)		7		(42)		—		(40)		—		(11)
Gain on VEBA claims adjustment		—		—		—		—		—		(21)
Other		4		—		—		—		—		—
Net periodic benefit costs (credit)		150		155		128		145		(40)		143
Special early retirement cost		1		—		1		—		77		4
Total benefit costs	$	151	$	155	$	129	$	145	$	37	$	147
Other comprehensive (income) loss:
Net (income) loss	$	(1,871)	$	(293)	$	2,509	$	358	$	2,870	$	266
Recognition of net actuarial losses		(271)		(47)		(101)		(26)		—		(13)
Prior service cost (credit)		98		—		11		(7)		—		(91)
Amortization of prior service cost (credit)		(7)		42		—		40		—		11
Recognition of net actuarial gain on curtailment remeasurement		(553)		—		—		—		—		—
Recognition of curtailment gain		(316)		—		—		—		—		—
Tax Effect —net actuarial loss		159		14		(5)		—		—		—
Tax Effect —net prior service credit		4		—		—		—		—		—
Other		1		(1)		(2)		—		—		—
Total recognized in other comprehensive (income) loss		(2,756)		(285)		2,412		365		2,870		173
Total recognized in total benefit costs and other comprehensive (income) loss	$	(2,605)	$	(130)	$	2,541	$	510	$	2,907	$	320

The prior year financial information has been reclassified to conform with current year presentation.

In 2014, $108 million of unrecognized net actuarial losses are expected to be recognized into expense. Additionally, $11 million of prior service credits are expected to be amortized as a reduction to expense during 2014.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Assumptions

Assumptions used to determine the benefit obligation and expense were as follows:

	Years Ended December 31,
	2013				2012				2011
	Pension Benefits		OPEB		Pension Benefits		OPEB		Pension Benefits		OPEB
Weighted-Average Assumptions Used to Determine Benefit Obligations at December 31:
Discount rate —ongoing benefits		4.69%		4.87%		3.98%		4.07%		4.84%		4.93%
Rate of compensation increase		3.09%		2.84%		3.09%		2.70%		3.77%		2.70%
Weighted-Average Assumptions Used to Determine Periodic Costs:
Discount rate —ongoing benefits		3.98%		4.07%		4.84%		4.93%		5.33%		5.57%
Expected return on plan assets		7.41%		—		7.41%		—		7.41%		—
Rate of compensation increase		3.09%		2.84%		3.77%		2.70%		3.77%		2.70%

We currently sponsor OPEB plans primarily in the U.S. and Canada. The annual rate of increase in the per capita cost of covered U.S. health care benefits assumed for 2013 was 6.75 percent. The annual rate was assumed to decrease gradually to 5.0 percent in 2021 and remain at that level thereafter. The annual rate of increase in the per capita cost of covered Canadian health care benefits assumed for 2013 was 3.33 percent. The annual rate was assumed to increase gradually to 3.62 percent in 2017 and remain at that level thereafter.

The assumed health care cost trend rate has a significant effect on the amounts reported for postretirement health care and life insurance benefits. A one percentage point change in the assumed health care cost trend rate for U.S. and Canada combined would have the following effects as of December 31, 2013 (in millions of dollars):

	One Percentage Point
	Increase		Decrease
Effect on total of service and interest cost components	$	5	$	(4)
Effect on postretirement benefit obligation		68		(58)

The expected long-term rate of return on plan assets assumption is developed using a consistent approach across all pension plans. This approach primarily considers various inputs from a range of advisors for long-term capital market returns, inflation, bond yields and other variables, adjusted for specific aspects of our investment strategy.

The discount rates for the plans were determined as of December 31 of each year. The rates are based on yields of high-quality (AA-rated or better) fixed income investments for which the timing and amounts of payments match the timing and amounts of the projected pension and postretirement health care, legal and life insurance benefit payments.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Plan Assets

Our investment strategies and objectives for pension assets reflect a balance of liability-hedging and return-seeking considerations. Our investment objectives are to minimize the volatility of the value of the pension assets relative to the pension liabilities and to ensure pension assets are sufficient to pay plan obligations. Our objective of minimizing the volatility of assets relative to liabilities is addressed primarily through asset diversification, partial asset-liability matching and hedging. Assets are broadly diversified across many asset classes to achieve risk-adjusted returns that, in total, lower asset volatility relative to the liabilities. In order to minimize pension asset volatility relative to the pension liabilities, a portion of the pension plan assets are allocated to fixed income investments.

The weighted-average target asset allocations for all of our plan assets at December 31, 2013 were 46 percent fixed income, 29 percent equity, 23 percent alternative investments and 2 percent other investments. Our policy, which rebalances investments regularly, ensures actual allocations are in line with target allocations as appropriate.

Assets are actively managed, primarily by external investment managers. Investment managers are not permitted to invest outside of the asset class or strategy for which they have been appointed. We use investment guidelines to ensure that investment managers invest solely within the mandated investment strategy. Certain investment managers use derivative financial instruments to mitigate the risk of changes in interest rates and foreign currencies impacting the fair values of certain investments. Derivative financial instruments may also be used in place of physical securities when it is more cost effective and/or efficient to do so.

Sources of potential risks in the pension plan assets relate to market risk, interest rate risk and operating risk. Market risk is mitigated by diversification strategies and, as a result, there are no significant concentrations of risk in terms of sector, industry, geography, market capitalization, manager or counterparty. Interest rate risk is mitigated by partial asset-liability matching. Our fixed income target asset allocation partially matches the bond-like and long-dated nature of the pension liabilities. Interest rate increases generally will result in a decline in the value of investments in fixed income securities and the present value of the obligations. Conversely, interest rate decreases generally will increase the value of investments in fixed income securities and the present value of the obligations. Operating risks are mitigated through ongoing oversight of external investment managers’ style adherence, team strength, firm health and internal controls.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Plan Assets —Continued

The fair values of our pension plan assets as of December 31 by asset class were as follows (in millions of dollars):

	2013
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Pension plan assets:
Cash and cash equivalents	$	549	$	178	$	—	$	727
Equity securities:
U.S. companies		2,772		15		—		2,787
Non-U.S. companies		2,112		—		—		2,112
Commingled funds		131		1,820		—		1,951
Fixed income securities:
Government securities		926		2,500		—		3,426
Corporate bonds (including convertible and high yield bonds)		—		6,895		—		6,895
Other fixed income		—		879		—		879
Other investments:
Private equity funds		—		—		2,363		2,363
Real estate funds		—		1,189		496		1,685
Hedge funds		—		1,466		961		2,427
Insurance contracts and other		(41)		311		14		284
	$	6,449	$	15,253	$	3,834	$	25,536
Other Assets (Liabilities):
Cash and cash equivalents								3
Accounts receivable								167
Accounts payable								(52)
Total fair value of pension assets							$	25,654

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Plan Assets —Continued

	2012
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Pension plan assets:
Cash and cash equivalents	$	532	$	150	$	—	$	682
Equity securities:
U.S. companies		2,352		21		—		2,373
Non-U.S. companies		2,031		—		—		2,031
Commingled funds		91		1,195		—		1,286
Fixed income securities:
Government securities		2,250		2,462		—		4,712
Corporate bonds (including convertible and high yield bonds)		—		6,930		—		6,930
Other fixed income		—		948		—		948
Other investments:
Private equity funds		—		—		2,393		2,393
Real estate funds		—		1,124		487		1,611
Hedge funds		—		1,468		965		2,433
Insurance contracts and other		(2)		500		16		514
	$	7,254	$	14,798	$	3,861	$	25,913
Other Assets (Liabilities):
Cash and cash equivalents								6
Accounts receivable								207
Accounts payable								(154)
Total fair value of pension assets							$	25,972

The prior year financial information has been reclassified to conform with current year presentation.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Plan Assets —Continued

A reconciliation of Level 3 pension plan assets held by us was as follows (in millions of dollars):

	Year Ended December 31, 2013
	January 1, 2013		Net Unrealized Gains (Losses)		Net Realized Gains (Losses)		Net Purchases, Issuances and Settlements		Transfers Into (Out of) Level 3		December 31, 2013
Equity securities:
U.S. companies	$	—	$	—	$	—	$	—	$	—	$	—
Fixed income securities:
Corporate bonds (including convertible and high yield bonds)		—		—		—		—		—		—
Other investments:
Private equity funds		2,393		194		(70)		(154)		—		2,363
Real estate funds		487		46		(4)		(33)		—		496
Hedge funds		965		120		(4)		(120)		—		961
Insurance contracts and other		16		(1)		—		(1)		—		14
Total	$	3,861	$	359	$	(78)	$	(308)	$	—	$	3,834
	Year Ended December 31, 2012
	January 1, 2012		Net Unrealized Gains (Losses)		Net Realized Gains (Losses)		Net Purchases, Issuances and Settlements		Transfers Into (Out of) Level 3		December 31, 2012
Equity securities:
U.S. companies	$	1	$	2	$	(3)	$	—	$	—	$	—
Fixed income securities:
Corporate bonds (including convertible and high yield bonds)		—		31		(31)		—		—		—
Other investments:
Private equity funds		2,760		(177)		(25)		(165)		—		2,393
Real estate funds		512		2		(19)		(8)		—		487
Hedge funds		976		84		(8)		(87)		—		965
Insurance contracts and other		17		(1)		—		—		—		16
Total	$	4,266	$	(59)	$	(86)	$	(260)	$	—	$	3,861

F-71

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Plan Assets —Continued

Plan assets are recognized and measured at fair value in accordance with the accounting guidance related to fair value measurements, which specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques (Level 1, 2 and 3). A variety of inputs are used, including independent pricing vendors, third party appraisals, and fund net asset value (“NAV”). Plan assets valued using NAV are classified as Level 3 if redemption at the measurement date is not available. Refer to Note 2, Basis of Presentation and Significant Accounting Policies, for information regarding the fair value hierarchy.

Cash and cash equivalents

Cash and cash equivalents are primarily invested in short-term, high quality government securities and are valued at their outstanding balances, which approximate fair value.

Equity securities

Equity investments are composed broadly of U.S., developed international and emerging market equity securities and are generally valued using quoted market prices. Commingled funds, which include common collective trust funds, mutual funds and other investment entities, are valued at their NAV, which is based on the percentage ownership interest in the fair value of the underlying assets.

Fixed income securities

Fixed income investments are composed primarily of long-duration U.S. Treasury and global government bonds, as well as U.S., developed international and emerging market companies’ debt securities diversified by sector and geography. Fixed income securities are valued using quoted market prices. If quoted market prices are not available, prices for similar assets and matrix pricing models are used.

Other investments

Other investments include private equity, real estate and hedge funds which are generally valued based on the NAV. Private equity investments include those in limited partnerships that invest primarily in operating companies that are not publicly traded on a stock exchange. Our private equity investment strategies include leveraged buyouts, venture capital, mezzanine and distressed investments. Real estate investments include those in limited partnerships that invest in various commercial and residential real estate projects both domestically and internationally. Hedge fund investments include those seeking to maximize absolute returns using a broad range of strategies to enhance returns and provide additional diversification. Investments in limited partnerships are valued at the NAV, which is based on audited financial statements of the funds when available, with adjustments to account for partnership activity and other applicable valuation adjustments.

Contributions and Payments

Employer contributions to our U.S. funded pension plans are expected to be $833 million in 2014, of which $790 million are discretionary contributions and $43 million are mandatory contributions to satisfy minimum funding requirements. Employer contributions to our unfunded pension and OPEB plans in 2014 are expected to be $58 million and $178 million, respectively, which represents the expected benefit payments to participants.

During the life of the plans, we intend to primarily utilize plan assets to fund benefit payments and minimize our cash contributions. OPEB payments are currently funded from our cash flows from operations.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 18. Employee Retirement and Other Benefits —Continued

Contributions and Payments —Continued

In connection with the 363 Transaction, we acquired a $600 million receivable from a subsidiary of Daimler to fund contributions to our U.S. pension plans. This receivable was payable to us in three equal annual installments beginning in 2009 with the third and final $200 million installment received in 2011. Amounts received were utilized to fund a portion of our contributions to our funded pension plans in each year upon receipt of the installments.

Estimated future pension and OPEB benefits payments, and the Medicare Prescription Drug Improvement and Modernization Act of 2003 subsidy (“Medicare Part D Subsidy”) expected to be received for the next 10 years were as follows (in millions of dollars):

	Pension Benefits		OPEB		Medicare Part D Subsidy Receipts
2014	$	2,243	$	181	$	3
2015		2,200		178		3
2016		2,162		177		3
2017		2,128		176		3
2018		2,103		175		3
2019 – 2023		10,177		876		15

In March 2010, the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively the “Acts”) were enacted. The primary focus of the Acts is to significantly reform health care in the U.S., however several provisions of the Acts do not take effect for several years. Based on our ongoing assessments, we do not believe that the Acts will have a significant impact on our future period financial results.

Note 19. Other Transactions with Related Parties

We engage in arm’s length transactions with unconsolidated subsidiaries, associated companies and other related parties on commercial terms in their respective markets, considering the characteristics of the goods or services involved.

VEBA Trust

As of December 31, 2013, the VEBA Trust had a 41.5 percent beneficial ownership interest in the Company. Interest expense on the VEBA Trust Note totaled $433 million, $440 million and $432 million for the years ended December 31, 2013, 2012 and 2011, respectively.

Fiat

Ownership Interest

As of December 31, 2013, Fiat had a 58.5 percent beneficial ownership interest in the Company. Through a series of transactions in 2011 and early 2012, which included our achievement of the three Class B Events described in our governance documents and Fiat’s exercise of its incremental equity call option in May 2011, Fiat increased its ownership interest in the Company from 20.0 percent to 58.5 percent.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 19. Other Transactions with Related Parties —Continued

Fiat —Continued

Ownership Interest —Continued

In May 2011, and concurrent with the repayment of our U.S. Treasury and EDC credit facilities, Fiat exercised its incremental equity call option and acquired an additional 16 percent fully-diluted ownership interest in the Company through our issuance of 261,225 new Class A Membership Interests. We received the entire exercise price of $1,268 million in cash, increasing our contributed capital by the proceeds received. Refer to Note 12,Financial Liabilities, for information related to our refinancing transaction and the repayment of our U.S. Treasury and EDC credit facilities.

In January 2013, the 200,000 Class B Membership Interests held by Fiat automatically converted to 571,429 Class A Membership Interests in accordance with our governance documents. There were no dilutive effects of the conversion.

Refer to Note 25,Subsequent Events, for additional information regarding Fiat’s acquisition, through FNA, of the remaining equity interests in the Company from the VEBA Trust on January 21, 2014.

Fiat-Chrysler Alliance and Other Transactions

As part of the 363 Transaction, we also entered into a master industrial agreement with Fiat, or Master Industrial Agreement, which has significantly accelerated our efforts to revitalize and reshape our product portfolio through the manufacture of fuel-efficient vehicles utilizing Fiat technology, and has helped us benefit from the managerial experience Fiat leaders gained during Fiat’s own industrial recovery.

Pursuant to the Fiat-Chrysler Alliance, we established an industrial alliance through which we collaborate with Fiat on a number of fronts, including product and platform sharing and development, global distribution, procurement, information technology infrastructure and process improvement. The alliance is composed of various commercial arrangements entered into pursuant to our Master Industrial Agreement with Fiat.

As part of the Fiat-Chrysler Alliance, we manufacture certain Fiat-brand vehicles in Mexico, which are distributed throughout North America and sold to Fiat for distribution elsewhere in the world. In addition, Fiat manufactures certain Fiat brand vehicles for us, which we distribute in select markets. We are the exclusive distributor of Fiat brand vehicles and service parts throughout North America. We have also taken on the distribution of Fiat vehicles outside North America in those regions where our dealer networks are better established. Fiat is the general distributor of our vehicles and service parts in Europe and certain other markets outside of North America, where their dealer networks are better established.

In addition, as part of the Fiat-Chrysler Alliance, we have agreed to share access to certain platforms, vehicles, products and technology. We have also agreed to share costs with Fiat related to joint engineering and development activities and will reimburse each other based upon costs agreed to under the respective cost sharing arrangements. We have also entered into other transactions with Fiat for the purchase and supply of goods and services, including transactions in the ordinary course of business. We are obligated to make royalty payments to Fiat related to certain of the intellectual property that was contributed to us by Fiat. These royalty payments are calculated based on a percentage of the material cost of the vehicle, or portion of the vehicle or component, in which we utilize the Fiat intellectual property.

In May 2012, and pursuant to a 2011 definitive technology license agreement with Fiat, we recorded a $37 million license fee for Fiat’s use of intellectual property in the production of two vehicles. Production of one of the vehicles began during the three months ended March 31, 2013 and production of the second vehicle began

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 19. Other Transactions with Related Parties —Continued

Fiat —Continued

Fiat-Chrysler Alliance and Other Transactions —Continued

during the three months ended September 30, 2013. We began amortizing the applicable portion of the seven year license fee when production launched for each of the vehicles. As of December 31, 2013, $33 million remained in Deferred Revenue in the accompanying Consolidated Balance Sheets.

In October 2012, we sold three 100 percent owned international dealerships to Fiat for approximately $24 million. Fiat received approximately $9 million of cash held by these entities. There was no gain or loss on this transaction. Upon settlement of the transaction in the fourth quarter of 2013, we recorded a payable of approximately $1 million due to Fiat.

In May 2013, we entered into a $120 million (non-cash) six-year capital lease with Fiat related to equipment and tooling used in the production of a vehicle.

In December 2013, we entered into an agreement with Fiat related to the production of a vehicle for which Fiat will incur, on our behalf, costs and expenses for the development, manufacture and procurement of equipment and tooling. As of December 31, 2013, we recognized $98 million of such costs and expenses associated with Chrysler unique tooling which has been recorded in Property, Plant and Equipment, net in the accompanying Consolidated Balance Sheets. We have also agreed to fund upfront common capital investments based on an allocation of total costs as a percentage of the committed contract volumes of supplied vehicles. The amounts, allocation, structure and timing for funding our upfront common capital investment is expected to be finalized in 2014.

The following summarizes our transactions with Fiat (in millions of dollars):

	Years Ended December 31,
	2013		2012		2011
Sales of vehicles, parts and services provided to Fiat	$	2,173	$	2,689	$	2,162
Purchases of vehicles, parts, services and tooling from Fiat		2,444		1,504		800
Amounts recognized in Property, Plant and Equipment, Net and Other Intangible Assets, Net		327		236		116
Reimbursements to Fiat recognized (1)		93		45		25
Reimbursements from Fiat recognized (1)		33		51		78
Royalty income from Fiat		8		—		—
Royalty fees incurred for intellectual property contributed by Fiat		2		3		2
Interest income on financial resources provided to Fiat		2		2		—
Interest expense on financial resources provided by Fiat		8		—		—

(1) Includes reimbursements recognized for costs related to shared engineering and development activities performed under the product and platform sharing arrangements that are part of our industrial alliance.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 19. Other Transactions with Related Parties —Continued

Related Party Summary

U.S. Treasury

Effective July 21, 2011, the U.S. Treasury is no longer deemed a related party as a result of Fiat acquiring beneficial ownership of all the membership interests in us held by the U.S. Treasury.

Interest expense on financial resources provided by the U.S. Treasury totaled $229 million for the year ended December 31, 2011. Interest expense included PIK interest of $27 million for the year ended December 31, 2011, of which $17 million was capitalized as additional debt in accordance with the loan agreements. Refer to Note 12,Financial Liabilities, for additional information.

Amounts due from and to related parties as of December 31 were as follows (in millions of dollars):

	2013
	VEBA Trust		Fiat		Other		Total
Amounts due from related parties (included in Prepaid Expenses and Other Assets and Advances to Related Parties and Other Financial Assets)	$	—	$	725	$	13	$	738
Amounts due to related parties (included in Accrued Expenses and Other Liabilities)	$	215	$	714	$	4	$	933
Financial liabilities to related parties (included in Financial Liabilities)		4,192 (1)		127		—		4,319
Total due to related parties	$	4,407	$	841	$	4	$	5,252
	2012
	VEBA Trust		Fiat		Other		Total
Amounts due from related parties (included in Prepaid Expenses and Other Assets and Advances to Related Parties and Other Financial Assets)	$	—	$	500	$	15	$	515
Amounts due to related parties (included in Accrued Expenses and Other Liabilities)	$	222	$	558	$	4	$	784
Financial liabilities to related parties (included in Financial Liabilities)		4,288 (1)		—		5		4,293
Total due to related parties	$	4,510	$	558	$	9	$	5,077

(1) Amounts are net of discounts of $523 million and $586 million as of December 31, 2013 and 2012, respectively. Refer toNote 12, Financial Liabilities, for additional information.

Amounts included in “Other” above relate to balances with related unconsolidated companies as a result of transactions in the ordinary course of business.

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 20. Geographic Information

Revenues, net are allocated to geographic areas based on the customer location. Long-lived assets consist of property, plant and equipment (refer to Note 7) and equipment and other assets on operating leases (refer to Note 8), net of accumulated depreciation and amortization. Revenues, net and long-lived assets by geographic area were as follows (in millions of dollars):

Revenues, net:

	Years Ended December 31,
	2013		2012		2011
North America:
United States	$	51,073	$	46,708	$	37,972
Canada		7,731		7,272		7,196
Mexico		1,829		1,892		1,881
Total North America		60,633		55,872		47,049
Rest of World		11,511		9,912		7,932
Total	$	72,144	$	65,784	$	54,981

Long-lived assets:

	December 31, 2013		December 31, 2012
North America:
United States	$	13,026	$	11,932
Canada		1,599		1,706
Mexico		2,536		2,632
Total North America		17,161		16,270
Rest of World		301		197
Total	$	17,462	$	16,467

Note 21. Restructuring Actions

In connection with the 363 Transaction, we assumed certain liabilities related to specific restructuring actions commenced by Old Carco. These liabilities represented costs for workforce reduction actions related to our represented and non-represented hourly and salaried workforce, as well as specific contractual liabilities assumed for other costs, including supplier cancellation claims.

Key initiatives for Old Carco’s restructuring actions included workforce reductions, elimination of excess production capacity, refinements to its product portfolio and restructuring of international distribution operations. To eliminate excess production capacity, Old Carco eliminated manufacturing work shifts, reduced line speeds at certain manufacturing facilities, adjusted volumes at stamping and powertrain facilities and idled certain manufacturing plants. Old Carco’s restructuring actions also included the cancellation of five existing products from its portfolio, discontinued development on certain previously planned product offerings and the closure of certain parts distribution centers in the U.S. and Canada. We will continue to execute the remaining actions under Old Carco’s restructuring initiatives. The remaining actions principally include the completion of the activities associated with the idling of two manufacturing facilities and the restructuring of our international distribution

F-77

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 21. Restructuring Actions —Continued

operations, the plans for which have been refined, including the integration of the operations of our European distribution and dealer network into Fiat’s distribution organization. Costs associated with these remaining actions include, but are not limited to: employee severance, legal claims, and other international dealer network related costs. The remaining workforce reductions will affect represented and non-represented hourly and salaried employees and will be achieved through a combination of retirements, special programs, attrition and involuntary separations.

There were no restructuring charges recorded in 2013. We recorded charges, net of discounting, of $1 million and $51 million for the years ended December 31, 2012 and 2011, respectively. During the year ended December 31, 2012, the charges primarily related to costs associated with employee relocations for previously announced restructuring initiatives. During the year ended December 31, 2011, the charges primarily included costs associated with employee relocations and plant deactivations for previously announced restructuring initiatives, as well as other transition costs of $20 million resulting from the integration of the operations of our European distribution and dealer network into Fiat’s distribution organization.

We made refinements to existing reserve estimates resulting in net reductions of $14 million, $62 million and $48 million for the years ended December 31, 2013, 2012 and 2011, respectively. During the year ended December 31, 2013, the adjustments related to decreases in the expected workforce reduction costs and legal claim reserves. During the year ended December 31, 2012, the adjustments related to decreases in the expected workforce reduction costs and legal claim reserves, as well as other transition costs of $5 million related to the integration of the operations of our European distribution and dealer network into Fiat’s distribution organization. During the year ended December 31, 2011, the adjustments related to decreases in the expected workforce reduction costs, legal and supplier cancellation claim reserves as a result of management’s adequacy reviews, and refinements in the estimated costs required to settle certain litigation matters and other costs directly associated with the integration of the operations of our European distribution and dealer network into Fiat’s distribution organization. These refinements, which were based on management’s adequacy reviews, took into consideration the status of the restructuring actions and the estimated costs to complete the actions.

The restructuring charges and reserve adjustments are included in Restructuring (Income) Expenses, Net in the accompanying Consolidated Statements of Income and would have otherwise been reflected in Cost of Sales.

We anticipate that the total costs we will incur related to these restructuring activities, including the initial assumption of the $554 million obligation from Old Carco, as well as additional charges and refinements made to the estimates will be $523 million, including $351 million related to employee termination benefits and $172 million of other costs. We expect to make total future payments of $56 million.

F-78

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 21. Restructuring Actions —Continued

Restructuring reserves are included in Accrued Expenses and Other Liabilities in the accompanying Consolidated Balance Sheets. The following summarizes the restructuring reserves activity (in millions of dollars):

	Years Ended December 31,
	2013						2012						2011
	Workforce Reductions		Other		Total		Workforce Reductions		Other		Total		Workforce Reductions		Other		Total
Balance at beginning of period	$	20	$	49	$	69	$	29	$	121	$	150	$	79	$	160	$	239
Charges		—		—		—		1		—		1		15		16		31
Adjustments to reserve estimates		(9)		(5)		(14)		(4)		(53)		(57)		(9)		(39)		(48)
Payments		—		(1)		(1)		(6)		(20)		(26)		(38)		(10)		(48)
Amounts recognized and transferred to employee benefit plans		—		—		—		—		—		—		(10)		—		(10)
Other, including currency translation		—		2		2		—		1		1		(8)		(6)		(14)
Balance at end of period	$	11	$	45	$	56	$	20	$	49	$	69	$	29	$	121	$	150

Note 22. Venezuelan Currency Regulations and Devaluation

The functional currency of Chrysler de Venezuela LLC (“CdV”), our 100 percent owned subsidiary in Venezuela, is the USD. Pursuant to certain Venezuelan foreign currency exchange control regulations, the Central Bank of Venezuela centralizes all foreign currency transactions in the country. Under these regulations, the purchase and sale of foreign currency must be made through the Commission for the Administration of Foreign Exchange (“CADIVI”).

On February 8, 2013, the Venezuelan government announced a devaluation of the official exchange rate of the Venezuelan bolivar (“VEF”) relative to the USD from 4.30 VEF per USD to 6.30 VEF per USD, effective February 13, 2013. As a result of this devaluation, we recognized a $78 million foreign currency translation loss as a reduction to Revenues, Net in the accompanying Consolidated Statements of Income in 2013. Subsequent to the devaluation, certain monetary liabilities, which had been submitted to the CADIVI for payment approval through the ordinary course of business prior to the devaluation date, were approved to be paid at an exchange rate of 4.30 VEF per USD. As a result, during the year ended December 31, 2013, we recognized foreign currency transaction gains in Revenues, Net of $22 million due to these monetary liabilities being previously remeasured at the 6.30 VEF per USD at the devaluation date. No other events occurred during 2013 that resulted in changes to the VEF to USD official exchange rate.

As of December 31, 2013 and 2012, the net monetary assets of CdV denominated in VEF were 2,221 million ($352 million at 6.30 VEF per USD) and 1,138 million ($265 million at 4.30 VEF per USD), respectively, which included cash and cash equivalents denominated in VEF of 2,347 million ($373 million at 6.30 VEF per USD) and 1,476 million ($343 million at 4.30 VEF per USD), respectively.

F-79

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 23. Supplemental Parent and Guarantor Condensed Consolidating Financial Statements

Chrysler Group LLC (“Parent”), CG Co-Issuer, our 100 percent owned special purpose finance subsidiary, and certain of our 100 percent owned U.S. subsidiaries (the “Guarantors”) fully and unconditionally guarantee the 2019 Notes and 2021 Notes on a joint and several basis. CG Co-Issuer does not have any operations, assets, liabilities (other than the Notes) or revenues. CG Co-Issuer and each of the Guarantors also guarantee the Senior Credit Facilities. Refer to Note 12,Financial Liabilities, for additional information related to the Notes and Senior Credit Facilities.

In April 2013, a 100 percent owned U.S. subsidiary of the Company became a guarantor to the Notes and Senior Credit Facilities as its total assets exceeded thede minimis subsidiary threshold defined in our Original Senior Credit Agreement. The following supplemental parent and guarantor condensed consolidating financial statements reflect the addition of the new guarantor. The prior year financial information has been reclassified to conform to the current year presentation. The term “Guarantors” hereinafter includes this new guarantor.

The following condensed consolidating financial statements present financial data for (i) the Parent; (ii) the combined Guarantors; (iii) the combined Non-Guarantors (all subsidiaries that are not Guarantors (“Non-Guarantors”)); (iv) consolidating adjustments to arrive at the information for the Parent, Guarantors and Non-Guarantors on a consolidated basis and (v) the consolidated financial results for Chrysler Group.

Investments in subsidiaries are accounted for by the Parent and Guarantors using the equity method for this presentation. Results of operations of subsidiaries are therefore classified in the Parent’s and Guarantors’ investments in subsidiaries accounts. The consolidating adjustments set forth in the following condensed consolidating financial statements eliminate investments in subsidiaries, as well as intercompany balances, transactions, income and expense between the Parent, Guarantors and Non-Guarantors.

F-80

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 23. Supplemental Parent and Guarantor Condensed Consolidating Financial Statements —Continued

Condensed Consolidating Statements of Operations (in millions of dollars): 

	Year Ended December 31, 2013
	Parent		Guarantors		Non-Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
Revenues, net	$	74,603	$	9,313	$	40,733	$	(52,505)	$	72,144
Cost of sales		66,281		9,088		38,541		(52,512)		61,398
GROSS MARGIN		8,322		225		2,192		7		10,746
Selling, administrative and other expenses		4,057		177		815		169		5,218
Research and development expenses, net		2,256		—		64		—		2,320
Restructuring (income) expenses, net		(2)		(11)		(1)		—		(14)
Interest expense		934		13		140		(52)		1,035
Interest income		(27)		(2)		(25)		13		(41)
Loss on extinguishment of debt		24		—		—		—		24
INCOME (LOSS) BEFORE INCOME TAXES		1,080		48		1,199		(123)		2,204
Income tax expense (benefit)		(20)		—		(528)		(5)		(553)
Equity in net (income) loss of subsidiaries		(1,657)		(34)		—		1,691		—
NET INCOME (LOSS)		2,757		82		1,727		(1,809)		2,757
Other comprehensive income (loss)		3,274		—		530		(530)		3,274
TOTAL COMPREHENSIVE INCOME (LOSS)	$	6,031	$	82	$	2,257	$	(2,339)	$	6,031
	Year Ended December 31, 2012
	Parent		Guarantors		Non-Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
Revenues, net	$	68,634	$	8,584	$	37,776	$	(49,210)	$	65,784
Cost of sales		60,191		8,450		35,849		(49,140)		55,350
GROSS MARGIN		8,443		134		1,927		(70)		10,434
Selling, administrative and other expenses		4,139		229		665		146		5,179
Research and development expenses, net		2,288		1		35		—		2,324
Restructuring (income) expenses, net		(1)		(59)		(1)		—		(61)
Interest expense		982		12		144		(44)		1,094
Interest income		(17)		(1)		(26)		—		(44)
INCOME (LOSS) BEFORE INCOME TAXES		1,052		(48)		1,110		(172)		1,942
Income tax expense (benefit)		15		—		259		—		274
Equity in net (income) loss of subsidiaries		(631)		(30)		—		661		—
NET INCOME (LOSS)		1,668		(18)		851		(833)		1,668
Other comprehensive income (loss)		(2,882)		—		(131)		131		(2,882)
TOTAL COMPREHENSIVE INCOME (LOSS)	$	(1,214)	$	(18)	$	720	$	(702)	$	(1,214)
	Year Ended December 31, 2011
	Parent		Guarantors		Non-Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
Revenues, net	$	55,616	$	6,282	$	31,829	$	(38,746)	$	54,981
Cost of sales		48,839		6,326		30,006		(38,749)		46,422
GROSS MARGIN		6,777		(44)		1,823		3		8,559
Selling, administrative and other expenses		3,745		158		582		266		4,751
Research and development expenses, net		1,648		—		26		—		1,674
Restructuring (income) expenses, net		12		(8)		(1)		—		3
Interest expense		1,067		3		225		(57)		1,238
Interest income		(14)		(1)		(24)		—		(39)
Loss on extinguishment of debt		170		—		381		—		551
INCOME (LOSS) BEFORE INCOME TAXES		149		(196)		634		(206)		381
Income tax expense (benefit)		15		(1)		182		2		198
Equity in net (income) loss of subsidiaries		(49)		(26)		—		75		—
NET INCOME (LOSS)		183		(169)		452		(283)		183
Other comprehensive income (loss)		(2,987)		(1)		(936)		937		(2,987)
TOTAL COMPREHENSIVE INCOME (LOSS)	$	(2,804)	$	(170)	$	(484)	$	654	$	(2,804)

F-81

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 23. Supplemental Parent and Guarantor Condensed Consolidating Financial Statements —Continued

Condensed Consolidating Balance Sheets (in millions of dollars):

	December 31, 2013
	Parent		Guarantors		Non-Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
CURRENT ASSETS:
Cash and cash equivalents	$	10,256	$	171	$	2,917	$	—	$	13,344
Restricted cash		1		—		7		—		8
Trade receivables, net		423		310		428		—		1,161
Inventories		3,168		121		2,809		(209)		5,889
Prepaid expenses and other assets
Due from subsidiaries		—		—		170		(170)		—
Other		446		567		634		—		1,647
Deferred taxes		19		1		464		—		484
TOTAL CURRENT ASSETS		14,313		1,170		7,429		(379)		22,533
PROPERTY AND EQUIPMENT:
Property, plant and equipment, net		11,328		576		4,300		(133)		16,071
Equipment and other assets on operating leases, net		841		283		305		(38)		1,391
TOTAL PROPERTY AND EQUIPMENT		12,169		859		4,605		(171)		17,462
OTHER ASSETS:
Advances to related parties and other financial assets
Due from subsidiaries		1,782		168		111		(2,061)		—
Other		32		—		3		—		35
Investment in subsidiaries		4,684		161		—		(4,845)		—
Restricted cash		311		—		14		—		325
Goodwill		1,361		—		—		—		1,361
Other intangible assets, net		3,279		24		991		(919)		3,375
Prepaid expenses and other assets		267		13		157		—		437
Deferred taxes		27		—		315		—		342
TOTAL OTHER ASSETS		11,743		366		1,591		(7,825)		5,875
TOTAL ASSETS	$	38,225	$	2,395	$	13,625	$	(8,375)	$	45,870
CURRENT LIABILITIES:
Trade liabilities	$	7,956	$	164	$	2,523	$	—	$	10,643
Accrued expenses and other liabilities
Due to subsidiaries		1,646		696		—		(2,342)		—
Other		6,715		65		3,050		—		9,830
Current maturities of financial liabilities
Due to subsidiaries		2		—		170		(172)		—
Other		332		—		159		—		491
Deferred revenue		1,142		59		125		(28)		1,298
Deferred taxes		—		—		43		—		43
TOTAL CURRENT LIABILITIES		17,793		984		6,070		(2,542)		22,305
LONG-TERM LIABILITIES:
Accrued expenses and other liabilities		10,413		160		1,187		—		11,760
Financial liabilities
Due to subsidiaries		—		—		—		—		—
Other		10,433		—		1,377		—		11,810
Deferred revenue		750		138		212		—		1,100
Deferred taxes		78		—		59		—		137
TOTAL LONG-TERM LIABILITIES		21,674		298		2,835		—		24,807
MEMBERS’ INTEREST (DEFICIT):
Membership interests		—		—		409		(409)		—
Contributed capital		2,633		1,660		1,915		(3,575)		2,633
Accumulated income (losses)		171		(547)		2,936		(2,389)		171
Accumulated other comprehensive loss		(4,046)		—		(540)		540		(4,046)
TOTAL MEMBERS’ INTEREST (DEFICIT)		(1,242)		1,113		4,720		(5,833)		(1,242)
TOTAL LIABILITIES AND MEMBERS’ INTEREST (DEFICIT)	$	38,225	$	2,395	$	13,625	$	(8,375)	$	45,870

F-82

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 23. Supplemental Parent and Guarantor Condensed Consolidating Financial Statements —Continued

Condensed Consolidating Balance Sheets —Continued

	December 31, 2012
	Parent			Guarantors		Non-Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
CURRENT ASSETS:
Cash and cash equivalents	$	9,110		$	127	$	2,377	$	—	$	11,614
Restricted cash		28			—		—		—		28
Trade receivables, net		473			357		349		—		1,179
Inventories		2,621			152		2,444		(219)		4,998
Prepaid expenses and other assets
Due from subsidiaries		—			—		454		(454)		—
Other		323			399		386		—		1,108
Deferred taxes		—			1		20		2		23
TOTAL CURRENT ASSETS		12,555			1,036		6,030		(671)		18,950
PROPERTY AND EQUIPMENT:
Property, plant and equipment, net		10,596			607		4,424		(136)		15,491
Equipment and other assets on operating leases, net		468			264		277		(33)		976
TOTAL PROPERTY AND EQUIPMENT		11,064			871		4,701		(169)		16,467
OTHER ASSETS:
Advances to related parties and other financial assets
Due from subsidiaries		1,085			—		112		(1,197)		—
Other		47			—		—		—		47
Investment in subsidiaries		2,328			127		—		(2,455)		—
Restricted cash		329			—		14		—		343
Goodwill		1,361			—		—		—		1,361
Other intangible assets, net		3,254	��		25		1,065		(984)		3,360
Prepaid expenses and other assets		278			9		116		—		403
Deferred taxes		—			—		40		—		40
TOTAL OTHER ASSETS		8,682			161		1,347		(4,636)		5,554
TOTAL ASSETS	$	32,301		$	2,068	$	12,078	$	(5,476)	$	40,971
CURRENT LIABILITIES:
Trade liabilities	$	7,171		$	183	$	2,380	$	—	$	9,734
Accrued expenses and other liabilities
Due to subsidiaries		1,428			139		—		(1,567)		—
Other		5,847			44		2,627		—		8,518
Current maturities of financial liabilities
Due to subsidiaries		26			—		65		(91)		—
Other		266			—		190		—		456
Deferred revenue		730			52		80		—		862
Deferred taxes		—			—		71		—		71
TOTAL CURRENT LIABILITIES		15,468			418		5,413		(1,658)		19,641
LONG-TERM LIABILITIES:
Accrued expenses and other liabilities		12,951			217		2,369		—		15,537
Financial liabilities
Due to subsidiaries		—			299		—		(299)		—
Other		10,564			—		1,583		—		12,147
Deferred revenue		534			97		191		—		822
Deferred taxes		43			—		36		4		83
TOTAL LONG-TERM LIABILITIES		24,092			613		4,179		(295)		28,589
MEMBERS’ INTEREST (DEFICIT):
Membership interests		—			—		409		(409)		—
Contributed capital		2,647			1,660		1,810		(3,470)		2,647
Accumulated income (losses)		(2,586)			(623)		1,337		(714)		(2,586)
Accumulated other comprehensive loss		(7,320)			—		(1,070)		1,070		(7,320)
TOTAL MEMBERS’ INTEREST (DEFICIT)		(7,259)			1,037		2,486		(3,523)		(7,259)
TOTAL LIABILITIES AND MEMBERS’ INTEREST (DEFICIT)	$	32,301		$	2,068	$	12,078	$	(5,476)	$	40,971

F-83

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 23. Supplemental Parent and Guarantor Condensed Consolidating Financial Statements —Continued

Condensed Consolidating Statements of Cash Flows (in millions of dollars):

	Year Ended December 31, 2013
	Parent		Guarantors		Non- Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	4,708	$	593	$	1,551	$	(1,316)	$	5,536
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment and intangible assets		(2,606)		(53)		(775)		—		(3,434)
Proceeds from disposals of property, plant and equipment		4		—		4		—		8
Purchases of equipment and other assets on operating leases		—		(28)		—		—		(28)
Proceeds from disposals of equipment and other assets on operating leases		—		5		1		—		6
Change in restricted cash		45		—		(7)		—		38
Other		(3)		—		(3)		3		(3)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES		(2,560)		(76)		(780)		3		(3,413)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of Canadian Health Care Trust Note		—		—		(45)		—		(45)
Repayments of Auburn Hills Headquarters loan		—		—		(55)		—		(55)
Repayments of Mexican development banks credit facility		—		—		(31)		—		(31)
Repayments of Tranche B Term Loan		(30)		—		—		—		(30)
Repayment of Tranche B Term Loan in connection with amendment		(790)		—		—		—		(790)
Proceeds from Tranche B Term Loan in connection with amendment		790		—		—		—		790
Debt issuance costs		(30)		—		—		—		(30)
Net proceeds from other financial obligations —related party		(16)		—		12		—		(4)
Net repayments of other financial obligations —third party		(85)		—		(2)		—		(87)
Distribution for state tax withholding obligations on behalf of members		(20)		—		—		—		(20)
Dividends issued to subsidiaries		—		(6)		(128)		134		—
Net increase (decrease) in loans to subsidiaries		(821)		(467)		106		1,182		—
Other		—		—		3		(3)		—
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		(1,002)		(473)		(140)		1,313		(302)
Effect of exchange rate changes on cash and cash equivalents		—		—		(91)		—		(91)
Net change in cash and cash equivalents		1,146		44		540		—		1,730
Cash and cash equivalents at beginning of period		9,110		127		2,377		—		11,614
Cash and cash equivalents at end of period	$	10,256	$	171	$	2,917	$	—	$	13,344

F-84

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 23. Supplemental Parent and Guarantor Condensed Consolidating Financial Statements —Continued

Condensed Consolidating Statements of Cash Flows —Continued

	Year Ended December 31, 2012
	Parent		Guarantors		Non-Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	4,708	$	(195)	$	1,576	$	(268)	$	5,821
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment and intangible assets		(2,860)		(56)		(717)		—		(3,633)
Proceeds from disposals of property, plant and equipment		8		—		1		—		9
Purchases of equipment and other assets on operating leases		—		(10)		(113)		—		(123)
Proceeds from disposals of equipment and other assets on operating leases		—		18		69		—		87
Change in restricted cash		88		—		2		—		90
Proceeds from the sale of certain international dealerships to Fiat, net		—		—		11		—		11
Change in loans and notes receivable		2		—		—		—		2
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES		(2,762)		(48)		(747)		—		(3,557)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of Tranche B Term Loan		(30)		—		—		—		(30)
Repayments of Mexican development banks credit facility		—		—		(15)		—		(15)
Repayments of Gold Key Lease financing		—		—		(41)		—		(41)
Repayment of Canadian Health Care Trust Note		—		—		(25)		—		(25)
Repayments of Auburn Hills Headquarters loan		—		—		(50)		—		(50)
Net repayment of other financial liabilities		(72)		—		(12)		—		(84)
Distribution for state tax withholding obligations on behalf of members		(6)		—		—		—		(6)
Dividends issued to subsidiaries		—		(15)		(75)		90		—
Net increase (decrease) in loans to subsidiaries		(133)		62		(107)		178		—
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		(241)		47		(325)		268		(251)
Effect of exchange rate changes on cash and cash equivalents		—		—		—		—		—
Net change in cash and cash equivalents		1,705		(196)		504		—		2,013
Cash and cash equivalents at beginning of period		7,405		323		1,873		—		9,601
Cash and cash equivalents at end of period	$	9,110	$	127	$	2,377	$	—	$	11,614

F-85

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 23. Supplemental Parent and Guarantor Condensed Consolidating Financial Statements —Continued

Condensed Consolidating Statements of Cash Flows —Continued

	Year Ended December 31, 2011
	Parent		Guarantors		Non-Guarantors		Consolidating Adjustments		Chrysler Group LLC Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$	3,931	$	249	$	1,842	$	(1,419)	$	4,603
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment and intangible assets		(2,000)		(145)		(864)		—		(3,009)
Proceeds from disposals of property, plant and equipment		7		13		15		—		35
Purchases of equipment and other assets on operating leases		—		(35)		—		—		(35)
Proceeds from disposals of equipment and other assets on operating leases		—		16		688		—		704
Change in restricted cash		41		—		174		—		215
Change in loans and notes receivable		4		—		2		—		6
Proceeds from U.S. Dealer Automotive Receivables Transition LLC		96		—		—		—		96
Changes in investments in subsidiaries		2		—		—		(2)		—
Other		18		—		—		—		18
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES		(1,832)		(151)		15		(2)		(1,970)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of U.S. Treasury first lien credit facilities		(5,460)		—		—		—		(5,460)
Repayment of Export Development Canada credit facilities		—		—		(1,723)		—		(1,723)
Proceeds from Secured Senior Notes		3,160		—		—		—		3,160
Proceeds from Tranche B Term Loan		2,933		—		—		—		2,933
Repayments of Tranche B Term Loan		(15)		—		—		—		(15)
Proceeds from Mexican development banks credit facilities		—		—		217		—		217
Repayments of Gold Key Lease financing		—		—		(584)		—		(584)
Repayment of Canadian Health Care Trust Note		—		—		(26)		—		(26)
Repayments of Auburn Hills Headquarters loan		—		—		(13)		—		(13)
Net repayment of other financial liabilities		(74)		—		(7)		—		(81)
Debt issuance costs		(67)		—		(5)		—		(72)
Proceeds from Fiat’s incremental equity call option exercise		1,268		—		—		—		1,268
Distribution for state tax withholding obligations on behalf of members		(9)		—		—		—		(9)
Dividends issued to subsidiaries		—		(10)		(218)		228		—
Return of capital from subsidiaries		—		—		(2)		2		—
Net increase (decrease) in loans to subsidiaries		(1,301)		152		(42)		1,191		—
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		435		142		(2,403)		1,421		(405)
Effect of exchange rate changes on cash and cash equivalents		—		—		26		—		26
Net change in cash and cash equivalents		2,534		240		(520)		—		2,254
Cash and cash equivalents at beginning of period		4,871		83		2,393		—		7,347
Cash and cash equivalents at end of period	$	7,405	$	323	$	1,873	$	—	$	9,601

F-86

Note 24. Selected Quarterly Financial Data (unaudited)

Selected quarterly financial data consisted of the following (in millions of dollars):

	2013
	First Quarter		Second Quarter		Third Quarter		Fourth Quarter
Revenues, net	$	15,385	$	17,994	$	17,564	$	21,201
Gross margin		2,249		2,666		2,683		3,148
Interest expense		263		265		256		251
Loss on extinguishment of debt (1)		—		23		—		1
Income before income taxes		198		544		610		852
Net income (2)		166		507		464		1,620

	2012
	First Quarter		Second Quarter		Third Quarter		Fourth Quarter
Revenues, net	$	16,359	$	16,795	$	15,478	$	17,152
Gross margin		2,568		2,543		2,562		2,761
Interest expense		277		278		273		266
Income before income taxes		506		541		437		458
Net income		473		436		381		378

(1) In connection with the June 2013 amendment of our Senior Credit Facilities and the December 2013 re-pricing of the Tranche B Term Loan, we recognized a $24 million loss on extinguishment of debt. The loss consisted of the write off of $13 million of unamortized debt discounts and $3 million of unamortized debt issuance costs associated with the Senior Credit Facilities, as well as $8 million of call premium and other fees associated with the amendments. Refer toManagement’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Senior Credit Facilities, for additional information.

(2) Net income in the fourth quarter of 2013 includes a $962 million non-cash tax benefit related to the release of valuation allowances on deferred tax assets. Refer toNote 13, Income Taxes, for additional information.

Note 25. Subsequent Events

Fiat Equity Purchase Agreement and UAW Memorandum of Understanding

On January 21, 2014, Fiat, through its 100 percent owned indirect subsidiary FNA, acquired the VEBA Trust’s 41.5 percent membership interest in us for $3.65 billion. This transaction was funded through a one-time special distribution paid by us to our members of $1.9 billion, of which FNA directed their portion to the VEBA Trust, and a cash payment of $1.75 billion to the VEBA Trust from FNA. Concurrent with the closing of the transactions, we paid a distribution of approximately $60 million to our members in connection with such members’ tax obligations.

Contemporaneously, we entered into a memorandum of understanding (“MOU”) with the UAW to supplement our existing collective bargaining agreement in which the UAW made commitments to continue to support our industrial operations and continued roll-out of our World Class Manufacturing programs. Under the MOU, we agreed to make payments to the VEBA Trust totaling $700 million to be paid in four equal annual installments. The initial payment of $175 million was made with the closing of a transaction between FNA and the VEBA Trust in which we became a 100 percent owned indirect subsidiary of Fiat. This initial payment was funded from

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

F-87

CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 25. Subsequent Events —Continued

available cash on hand. The subsequent payments are payable on each of the next three anniversaries of the initial payment.

New Debt Issuances and Repayment of the VEBA Trust Note

On February 7, 2014, we and certain of our U.S. subsidiaries as guarantors entered into the following transactions to facilitate the repayment of the VEBA Trust Note:

• New Senior Credit Facilities – a $250 million additional term loan under the existing Tranche B Term Loan facility and a new $1,750 million term loan credit facility that matures on December 31, 2018;

• Secured Senior Notes due 2019 – issuance of an additional $1,375 million aggregate principal amount of 8 percent secured senior notes due June 15, 2019, at an issue price of 108.25 percent of the aggregate principal amount; and

• Secured Senior Notes due 2021 – issuance of an additional $1,380 million aggregate principal amount of 8 ¹⁄₄ percent secured senior notes due June 15, 2021, at an issue price of 110.50 percent of the aggregate principal amount.

The proceeds of these transactions were used to repay all amounts outstanding, including accrued and unpaid interest, of approximately $5.0 billion under the VEBA Trust Note.

F-88

Chrysler Group LLC

Offers to Exchange

up to $1,375,000,000 aggregate principal amount of new 8% Secured Senior Notes due 2019 registered under the Securities Act of 1933, for any and all of our outstanding additional 8% Secured Senior Notes due 2019 issued in February 2014, and

up to $1,380,000,000 aggregate principal amount of new 8  ¹⁄₄% Secured Senior Notes due 2021 registered under the Securities Act of 1933, for any and all of our outstanding additional 8  ¹⁄₄% Secured Senior Notes due 2021 issued in February 2014

PROSPECTUS

                    , 2014

All tendered old notes, executed letters of transmittal and other related documents should be directed to the exchange agent at the numbers and address below. Requests for assistance and for additional copies of the prospectus, the letter of transmittal and other related documents should also be directed to the exchange agent.

The exchange agent for the exchange offers is:

CITIBANK, N.A.

By Facsimile for Eligible Institutions:

(973) 461-7191 or (973) 461-7192

Attention: Citibank Agency & Trust

Confirm by telephone:

(973) 461-7169

By Mail/Overnight Courier/Hand:

Citibank, N.A.

Attention: Citibank Agency & Trust

480 Washington Boulevard, 30th Floor

Jersey City, New Jersey 07310

Telephone: (970) 461-7169

Facsimile: (973) 461-7191 or (973) 461-7192

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 20. Indemnification of Directors and Officers.

Each of Chrysler Group LLC, Autodie LLC, Chrysler Group International LLC, Chrysler Group International Services LLC, Chrysler Group Realty Company LLC, Chrysler Group Transport LLC, Chrysler Group Service Contracts LLC and Global Engine Manufacturing Alliance LLC is a limited liability company formed under the laws of the state of Delaware.

CG Co-Issuer Inc. is incorporated under the laws of the State of Delaware.

Section 18-108 of the Delaware Limited Liability Company Act provides that a limited liability company may indemnify any member or manager or other person against any and all claims and demands whatsoever, subject to any standards and restrictions set forth in its limited liability company agreement. Chrysler Group LLC’s limited liability company operating agreement provides that it will indemnify, to the fullest extent permitted by the Delaware Limited Liability Company Act and to the extent of its assets available for such purpose, each person who was or is made a party or is threatened to be made a party to or is involved in or participates as a witness with respect to any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was Chrysler Group LLC’s director or officer, or is or was serving at Chrysler Group LLC’s request as a manager, director, officer, employee, fiduciary or agent of another entity against any and all loss, cost, damage, fine, expense (including reasonable fees and expenses of attorneys and other advisors and any court costs incurred by such person) or liability actually and reasonably incurred by such person if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of Chrysler Group LLC.

Termination of a proceeding by judgment, order, settlement, conviction or upon a plea of no contest will not, of itself, create a presumption that such person did not act in good faith or in a manner such person reasonably believed to be in or not opposed to the best interests of Chrysler Group LLC. The foregoing indemnity will not apply in respect of any claim, issue or matter as to which a director or officer has been adjudged to be liable to Chrysler Group LLC, except to the extent the court in which such action or suit was brought determines such person is fairly and reasonably entitled to indemnity as such court deems proper. Chrysler Group LLC also will not be required to indemnify any director or officer in connection with a proceeding that was initiated by such person against Chrysler Group LLC or any of its subsidiaries, unless such proceeding was authorized by Chrysler Group LLC’s Board. Chrysler Group LLC will pay in advance or reimburse reasonable expenses (including advancing reasonable costs of defense) incurred by a director or officer who is named or threatened to be named in a proceeding, provided that such person will agree to repay Chrysler Group LLC if such person is finally judicially determined by a court of competent jurisdiction not to be entitled to indemnification.

Chrysler Group LLC has also entered into separate indemnification agreements with its directors. Each indemnification agreement provides that Chrysler Group LLC will indemnify its directors against all expenses (including reasonable attorneys’ or witness fees), judgments, penalties, losses, damages, liabilities, fines and amounts paid in settlement actually and reasonably incurred by a director or on his behalf in connection with any threatened, pending or completed action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing, appeal, or any other proceeding, to which any such director may be a party or threatened to be made a party or otherwise involved in as a witness by reason of such director’s status serving (i) as Chrysler Group LLC’s director, officer, employee, or agent or (ii) as a director, partner, trustee, officer, employee or agent of any other entity at Chrysler Group LLC’s request, or by reason of such director’s taking of any action or of any inaction on his or her part while acting in either of these capacities, including proceedings in the right of Chrysler Group LLC.

The indemnification agreements also require Chrysler Group LLC to advance expenses incurred by such persons within 15 days after receipt of a written request, provided that such persons undertake to repay such amounts if it is ultimately determined that they are not entitled to indemnification. Additionally, the agreements set forth certain procedures that will apply in the event of a claim for indemnification under the agreements and that

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Chrysler Group (or any other parties challenging indemnification) have the burden of proof to overcome that presumption in reaching any contrary determination.

Chrysler Group LLC is not required to provide indemnification under the agreements for certain matters, including indemnification and advancement of expenses for any action initiated by such person without the consent of Chrysler Group LLC’s board of directors (except actions to establish or enforce a right under such an indemnification agreement, our limited liability company operating agreement or a directors’ and officers’ insurance policy). Chrysler Group LLC believes that the terms of the agreements are reasonable and comparable to terms of agreements negotiated on an arm’s-length basis.

The rights to indemnification conferred in the limited liability company operating agreement and the separate indemnifications agreements are not exclusive of any other rights that such person may have or acquire under any law, agreement, vote of our members or disinterested directors or otherwise.

Chrysler Group LLC maintains directors’ and officers’ liability insurance for its officers and directors.

The limited liability company agreements of each of Autodie LLC, Chrysler Group International LLC, Chrysler Group International Services LLC, Chrysler Group Realty Company LLC, Chrysler Group Transport LLC and Global Engine Manufacturing Alliance LLC provide that each of them will indemnify, to the fullest extent permitted by the Delaware Limited Liability Company Act, each member and each officer, and each affiliate, agent, advisor, officer, partner, employee, member, representative, director, or shareholder of each such member or officer, from and against any and all losses, claims, damages, liabilities, expenses (including, without limitation, attorneys’ fees and other legal fees and expenses), judgments, fines and settlements sustained or incurred by such person as a result of any act, decision or omission concerning the business or activities of, or that otherwise is related to, the applicable company, including losses arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, that relate to or arise in connection with the operations or business of the companies or arise out of or are based upon in whole or part such person’s relationship to the applicable company, in which such person may be involved or is threatened to be involved, as a party or otherwise. Such persons shall not be entitled to indemnification for losses that are determined by a court of competent jurisdiction in a final, non-appealable decision to have resulted from the gross negligence or willful misconduct of such person. Reasonable expenses incurred in advance of the final disposition of the proceeding shall be paid or reimbursed by the applicable company upon receipt by such company of an undertaking by or on behalf of the person seeking indemnification to repay such amount if it shall be determined that such person is not entitled to be indemnified under the terms of such company’s limited liability company agreement.

The limited liability company agreement of Chrysler Group Service Contracts LLC provides that it will indemnify, to the extent of the company’s assets available for such purpose, each member, director and officer for any loss, damage or claim incurred by such person in by reason of any act or omission performed or omitted by such person in good faith on behalf of the company and in a manner reasonably believed to be within the scope of the authority conferred on such person by the limited liability company agreement, except that no such person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such person by reason of gross negligence or willful misconduct with respect to such acts or omissions. No member of the company will have personal liability on account of the company’s indemnification obligations.

Section 145 of the Delaware General Corporation Law (the “DGCL”) provides that a corporation may indemnify any person who is or was a director, officer, employee or agent of a corporation or enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of being or having been in any such capacity, if he acted in good faith in a manner reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action, or proceeding, had no reasonable cause to believe his conduct was unlawful,

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except that with respect to an action brought by or in the right of the corporation such indemnification is limited to expenses (including attorneys fees). CG Co-Issuer Inc.’s by-laws provide that it must indemnify its directors and officers to the fullest extent permitted by Delaware law.

Section 102(6)(7) of the DGCL permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director except for liability (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in god faith or which involves intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL or (iv) for any transaction from which the director derived any improper personal benefit. CG Co-Issuer Inc.’s certificate of incorporation provides for such limitation of liability.

Item 21. Exhibits and Financial Statement Schedules.

(a) Exhibits

Exhibit Number	Description of Documents
3.1	Certificate of Formation of Chrysler Group LLC, as amended (incorporated by reference to Exhibit 3.1 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
3.2	Composite Third Amended and Restated Limited Liability Company Operating Agreement of Chrysler Group LLC, dated as of February 24, 2012 (incorporated by reference to Exhibit 3.2 of Chrysler Group LLC’s Annual Report on Form 10-K, filed with the SEC on March 6, 2014, File No. 000-54282)
3.3	First Amendment to the Third Amended and Restated Limited Liability Company Operating Agreement of Chrysler Group LLC, dated as of February 24, 2012 (incorporated by reference to Exhibit 3.3 of Chrysler Group LLC’s Annual Report on Form 10-K, filed with the SEC on March 7, 2013, File No. 000-54282)
3.4	Second Amendment to the Third Amended and Restated Limited Liability Company Operating Agreement of Chrysler Group LLC, dated as of January 21, 2014 (incorporated by reference to Exhibit 3.4 of Chrysler Group LLC’s Annual Report on Form 10-K, filed with the SEC on March 6, 2014, File No. 000-54282)
3.5	Certificate of Incorporation of CG Co-Issuer Inc. (incorporated by reference to Exhibit 3.6 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.6	Bylaws of CG Co-Issuer Inc. (incorporated by reference to Exhibit 3.7 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, FileNo. 333-178649)
3.7	Certificate of Formation of Chrysler Group International LLC (incorporated by reference to Exhibit 3.8 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.8	Amended and Restated Limited Liability Company Agreement of Chrysler Group International LLC, dated as of June 10, 2009 (incorporated by reference to Exhibit 3.9 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, FileNo. 333-178649)
3.9	Certificate of Formation of Chrysler Group International Services S.A. LLC (incorporated by reference to Exhibit 3.10 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)

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Exhibit Number	Description of Documents
3.10	Certificate of Amendment of the Certificate of Formation of Chrysler Group International Services S.A. LLC changing its name to Chrysler Group International Services LLC (incorporated by reference to Exhibit 3.11 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.11	Amended and Restated Limited Liability Company Operating Agreement of Chrysler Group International Services LLC, dated as of June 10, 2009 (incorporated by reference to Exhibit 3.12 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.12	Certificate of Formation of Chrysler Group Realty Company LLC (incorporated by reference to Exhibit 3.13 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.13	Second Amended and Restated Limited Liability Company Agreement of Chrysler Group Realty Company LLC, dated as of June 22, 2009 (incorporated by reference to Exhibit 3.14 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.14	Certificate of Formation of Chrysler Group Service Contracts LLC (incorporated by reference to Exhibit 3.15 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.15	Limited Liability Company Agreement of Chrysler Group Service Contracts LLC, dated as of September 24, 2009 (incorporated by reference to Exhibit 3.16 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.16	Certificate of Formation of Chrysler Group Transport LLC (incorporated by reference to Exhibit 3.17 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011, File No. 333-178649)
3.17	Amended and Restated Limited Liability Company Agreement of Chrysler Group Transport LLC, dated as of June 10, 2009 (incorporated by reference to Exhibit 3.18 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011 File No. 333-178649)
3.18	Certificate of Formation of Global Engine Manufacturing Alliance LLC (incorporated by reference to Exhibit 3.19 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011 File No. 333-178649)
3.19	Second Amended and Restated Limited Liability Company Agreement of Global Engine Manufacturing Alliance LLC, dated as of March 23, 2010 (incorporated by reference to Exhibit 3.20 of Chrysler Group LLC’s Registration Statement on Form S-4, filed with the SEC on December 20, 2011 File No. 333-178649)
3.20**	Certificate of Formation of Autodie LLC
3.21**	Certificate of Amendment of the Certificate of Formation of Autodie LLC
3.22**	Third Amended and Restated Limited Liability Company Agreement of Autodie LLC, dated as of June 10, 2009
4.1	Indenture, relating to the Notes, dated as of May 24, 2011, among the Company, the Co-Issuer, the guarantors named on the signature pages thereto and Wilmington Trust FSB, as trustee and Citibank, N.A., as collateral agent, paying agent, registrar and authenticating agent (incorporated by reference to Exhibit 4.2 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on May 24, 2011, File No. 000-54282)

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Exhibit Number	Description of Documents
4.2	First Supplemental Indenture, relating to the Notes, dated as of February 2, 2012, among the Company, the Co-Issuer, the guarantors named on the signature pages thereto and Wilmington Trust, National Association (as successor by merger to Wilmington Trust FSB), as trustee and Citibank, N.A., as collateral agent, paying agent, registrar and authenticating agent (incorporated by reference to Exhibit 4.5 of Chrysler Group LLC’s Annual Report on Form 10-K, filed with the SEC on March 7, 2013, File No. 000-54282)
4.3	Second Supplemental Indenture, relating to the Notes, dated as of April 5, 2013, among the Company, the Co-Issuer, the guarantors named on the signature pages thereto and Wilmington Trust, National Association (as successor by merger to Wilmington Trust FSB), as trustee and Citibank, N.A., as collateral agent, paying agent, registrar and authenticating agent (incorporated by reference to Exhibit 4.1 of Chrysler Group LLC’s Quarterly Report on Form 10-Q, filed with the SEC on August 13, 2013, File No. 000-54282)
4.4	Registration Rights Agreement, dated as of February 7, 2014, among the Company, the Co-Issuer, the guarantors named on the signature pages thereto and Merrill Lynch, Pierce, Fenner & Smith Inc. (incorporated by reference to Exhibit 4.1 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on February 11, 2014, File No. 000-54282)
5.1**	Opinion of Sullivan & Cromwell LLP
10.1	Senior Credit Agreement, dated as of May 24, 2011, among the Company, the guarantors named on the signature pages thereto, the lenders named therein, and Citibank, N.A. as administrative agent and collateral agent (incorporated by reference to Exhibit 4.1 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on May 24, 2011, File No. 000-54282)
10.2	Amended and Restated Credit Agreement, dated as of June 21, 2013, among the Company, the lenders party thereto, Citibank, N.A. as administrative agent, and Citibank, N.A. as collateral agent (incorporated by reference to Exhibit 10.2 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on June 21, 2013, File No. 000-54282)
10.3	Assignment and Amendment, dated as of December 23, 2013, among Chrysler Group LLC, the lenders party thereto, and Citibank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on December 23, 2013, File No. 000-54282)
10.4	Incremental Assumption Agreement, dated as of February 7, 2014, among Chrysler Group LLC, the lenders party thereto and Citibank, N.A. as administrative agent (incorporated by reference to Exhibit 10.1 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on February 11, 2014, File No. 000-54282)
10.5	Term Loan Credit Agreement, dated as of February 7, 2014, among Chrysler Group LLC, the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent and collateral agent (incorporated by reference to Exhibit 10.2 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on February 11, 2014, File No. 000-54282)
10.6	Master Industrial Agreement, dated as of June 10, 2009, by and among Fiat Group Automobiles S.p.A., Fiat Powertrain Technologies S.p.A, Fiat North America LLC and Chrysler Group LLC (incorporated by reference to Exhibit 10.19 of Amendment No. 1 to Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on March 25, 2011, File No. 000-54282)
10.7þ	Master Private Label Financing Agreement, dated as of February 6, 2013, by and between Chrysler Group LLC and Santander Consumer USA Inc. (incorporated by reference to Exhibit 10.1 of Chrysler Group LLC’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2013, filed with the SEC on August 13, 2013, File No. 000-54282)

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Exhibit Number	Description of Documents
10.8	Chrysler Group LLC Supplemental Executive Retirement Plan, as amended (incorporated by reference to Exhibit 10.28 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.9	Chrysler Group LLC Executive Employees’ Supplemental Managed Retirement Plan (incorporated by reference to Exhibit 10.29 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.10	Chrysler Group LLC Restricted Stock Unit Plan, as amended (incorporated by reference to Exhibit 10.30 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.11	Form of Award Notice under the Chrysler Group LLC Restricted Stock Unit Plan dated November 12, 2009 (incorporated by reference to Exhibit 10.31 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.12	Form of Award Notice under the Chrysler Group LLC Restricted Stock Unit Plan dated March 12, 2010 (incorporated by reference to Exhibit 10.32 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.13	Form of Award Notice under the Chrysler Group LLC Restricted Stock Unit Plan dated January 20, 2011 (incorporated by reference to Exhibit 10.33 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.14	Chrysler Group LLC Deferred Phantom Share Plan, as amended (incorporated by reference to Exhibit 10.34 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.15	Amended and Restated Chrysler Group LLC Directors’ Restricted Stock Unit Plan (incorporated by reference to Exhibit 10.1 of Chrysler Group LLC’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012, filed with the SEC on May 14, 2012, File No. 000-54282)
10.16	Form of Award Notice under the Amended and Restated Chrysler Group LLC Directors’ Restricted Stock Unit Plan (incorporated by reference to Exhibit 10.16 of Chrysler Group LLC’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, filed with the SEC on March 7, 2013, File No. 000-54282)
10.17	Termination Allowance Plan (incorporated by reference to Exhibit 10.37 of Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on February 25, 2011, File No. 000-54282)
10.18	Letter Agreement between Chrysler Group LLC and Holly E. Leese (incorporated by reference to Exhibit 10.21 of Amendment No. 1 to Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on March 25, 2011, File No. 000-54282)
10.19	Letter Agreement between Chrysler Group LLC and Nancy A. Rae (incorporated by reference to Exhibit 10.22 of Amendment No. 1 to Chrysler Group LLC’s Registration Statement on Form 10, filed with the SEC on March 25, 2011, File No. 000-54282)
10.20	Chrysler Group LLC Performance and Leadership Management Award Plan (incorporated by reference to Exhibit 10.20 of Chrysler Group LLC’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed with the SEC on March 6, 2012, File No. 000-54282)
10.21	Chrysler Group LLC 2012 Long Term Incentive Plan (incorporated by reference to Exhibit 10.21 of Chrysler Group LLC’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed with the SEC on March 6, 2012, File No. 000-54282)
10.22	Form of Restricted Share Unit Award Agreement under the Chrysler Group LLC 2012 Long Term Incentive Plan (incorporated by reference to Exhibit 10.22 of Chrysler Group LLC’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed with the SEC on March 6, 2012, File No. 000-54282)

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Exhibit Number	Description of Documents
10.23	Form of Performance Share Unit Award Agreement under the Chrysler Group LLC 2012 Long Term Incentive Plan (incorporated by reference to Exhibit 10.23 of Chrysler Group LLC’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed with the SEC on March 6, 2012, File No. 000-54282)
10.24	UAR Award Grant Letter, dated December 3, 2012 (incorporated by reference to Exhibit 10.1 of Chrysler Group LLC’s Current Report on Form 8-K, filed with the SEC on December 7, 2012, File No. 000-54282)
12.1**	Computation of Ratio of Earnings to Fixed Charges
21.1	List of Subsidiaries of Chrysler Group LLC (incorporated by reference to Exhibit 21.1 of Chrysler Group LLC’s Annual Report on Form 10-K, filed with the SEC on March 6, 2014, File No. 000-54282)
23.1*	Consent of Deloitte & Touche LLP, an independent registered public accounting firm
23.2*	Consent of Ernst & Young LLP, an independent registered public accounting firm
23.3	Consent of Sullivan & Cromwell LLP (included in the opinion filed as Exhibit 5.1 to this Registration Statement)
24.1**	Powers of Attorney (included on signature pages)
25.1**	Statement of Eligibility of Trustee on Form T-1 under Trust Indenture Act of 1939
99.1**	Form of Letter of Transmittal
99.2**	Form of Notice of Guaranteed Delivery
101.INSø	XBRL Instant Document
101.SCHø	XBRL Taxonomy Extension Schema Document
101.CALø	XBRL Taxonomy Extension Calculation Linkbase Document
101.LABø	XBRL Taxonomy Extension Label Linkbase Document
101.PREø	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEFø	XBRL Taxonomy Extension Definition Linkbase Document

* Filed electronically herewith

** Previously filed electronically

þ Confidential treatment has been requested or previously granted to portions of this exhibit by the SEC

ø Previously submitted electronically

(b) Financial Statement Schedules.

1. The consolidated financial statements required to be filed as part of this Registration Statement are included in the prospectus.

2. Chrysler Group LLC and Consolidated Subsidiaries Schedule II

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CHRYSLER GROUP LLC AND CONSOLIDATED SUBSIDIARIES

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS

(In millions of dollars)

Description	Balance at Beginning of Period		Additions Charged to Costs and Expenses		Additions Charged to Other Accounts			Deductions			Balance at End of Period
For the Year Ended December 31, 2013
Allowances deducted from assets:
Allowance for doubtful accounts on trade receivables	$	56	$	13	$	—		$	(15	) (1)	$	54
Valuation allowance on deferred tax assets		1,164		4		—			(1,017	)		151
For the Year Ended December 31, 2012
Allowances deducted from assets:
Allowance for doubtful accounts on trade receivables	$	68	$	5	$	—		$	(17	) (1)	$	56
Valuation allowance on deferred tax assets		1,124		28		117	(2)		(105	)		1,164
For the Year Ended December 31, 2011
Allowances deducted from assets:
Allowance for doubtful accounts on trade receivables		102		24		—			(58	) (1)		68
Valuation allowance on deferred tax assets		852		35		237	(3)		—			1,124

(1) Trade receivable write-offs, subsequent collections and other adjustments.

(2) Amounts charged to AOCI, deferred tax assets and deferred tax liabilities.

(3) Amounts charged to AOCI.

II-8

Item 22. Undertakings.

(a) Each of the undersigned registrants hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered that remain unsold at the termination of the offering.

(4) That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, in a primary offering of securities of the undersigned registrants pursuant to the registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrants will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(a) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

(b) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrants or used or referred to by the undersigned registrant;

(c) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(d) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

(5) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrants have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer of controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrants will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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(b) The undersigned registrants hereby undertake to respond to requests for information that is incorporated by reference into the prospectus pursuant to Item 4, 10(b), 11, or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

(c) The undersigned registrants hereby undertake to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

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SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

CHRYSLER GROUP LLC
By:	/S/    RICHARD K. PALMER
	Richard K. Palmer
	Senior Vice President and Chief Financial Officer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

Signature	Title
/S/    SERGIO MARCHIONNE         Sergio Marchionne	Chairman, Chief Executive Officer, Chief Operating Officer and President (principal executive officer)
/S/    RICHARD K. PALMER         Richard K. Palmer	Senior Vice President and Chief Financial Officer (principal financial officer)
/S/    ALESSANDRO GILI         Alessandro Gili	Vice President, Chief Accounting Officer and Corporate Controller (principal accounting officer)
* Léo W. Houle	Director
* John B. Lanaway	Director
* Robert G. Liberatore	Director
* Ruth J. Simmons	Director
* Douglas M. Steenland	Director
* Ronald L. Thompson	Director
* Stephen M. Wolf	Director

*By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title	Attorney-in-Fact

II-11

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

CG CO-ISSUER INC.
By:	/S/    RICHARD K. PALMER
	Richard K. Palmer
	President

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	/S/    RICHARD K. PALMER
	Name:	Richard K. Palmer
	Title:	President and Director (principal executive, financial and accounting officer)
By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title:	Director

II-12

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

AUTODIE LLC
By:	/S/    KENNETH D. NILSON
	Kenneth D. Nilson
	Vice President & Treasurer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	*
	Name:	Alan D. Whitted
	Title:	President and Director (principal executive officer)
By:	*
	Name:	Charles Murphy
	Title:	Chief Financial Officer (principal financial and accounting officer)
By:	*
	Name:	Mauro Pino
	Title:	Director
By:	*
	Name:	Annette C. Bayne
	Title:	Director

*By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title	Attorney-in-Fact

II-13

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

CHRYSLER GROUP INTERNATIONAL LLC
By:	/S/    KENNETH D. NILSON
	Kenneth D. Nilson
	Vice President & Treasurer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	*
	Name:	Michael Manley
	Title:	President (principal executive officer)
By:	/S/    KENNETH D. NILSON
	Name:	Kenneth D. Nilson
	Title:	Vice President & Treasurer (principal financial and accounting officer)
CHRYSLER GROUP LLC, as sole Member
By:	/S/    KENNETH D. NILSON
	Name:	Kenneth D. Nilson
	Title:	Acting Treasurer

*By:	/S/    MARJORIE H. LOEB
	Name: Marjorie H. Loeb Title:   Attorney-in-Fact

II-14

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

CHRYSLER GROUP INTERNATIONAL SERVICES LLC
By:	/S/    KENNETH D. NILSON
	Kenneth D. Nilson
	Vice President & Treasurer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	/S/    KENNETH D. NILSON
	Name:	Kenneth D. Nilson
	Title:	Vice President & Treasurer (principal executive, financial and accounting officer)
By:	*
	Name:	Peter A. Weiss
	Title:	Vice President (principal executive officer)
CHRYSLER GROUP LLC, as sole Member
By:	/S/    KENNETH D. NILSON
	Name:	Kenneth D. Nilson
	Title:	Acting Treasurer

*By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title	Attorney-in-Fact

II-15

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

CHRYSLER GROUP REALTY COMPANY LLC
By:	/S/    KENNETH D. NILSON
	Kenneth D. Nilson
	Vice President & Treasurer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	*
	Name:	Pete M. Grady
	Title:	Vice President (principal executive officer)
By:	*
	Name:	Patrick White
	Title:	Vice President (principal financial and accounting officer)
CHRYSLER GROUP LLC, as sole Member
By:	/S/    KENNETH D. NILSON
	Name:	Kenneth D. Nilson
	Title:	Acting Treasurer

*By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title	Attorney-in-Fact

II-16

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

CHRYSLER GROUP SERVICE CONTRACTS LLC
By:	/S/    KENNETH D. NILSON
	Kenneth D. Nilson
	Treasurer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	*
	Name:	Alan D’Agostini
	Title:	President and sole Director (principal executive officer)
By:	*
	Name:	Thomas L. Richards
	Title:	Chief Financial Officer (principal financial and accounting officer)

*By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title	Attorney-in-Fact

II-17

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

CHRYSLER GROUP TRANSPORT LLC
By:	/S/    KENNETH D. NILSON
	Kenneth D. Nilson
	Vice President & Treasurer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	*
	Name:	Martin C. Difiore
	Title:	President (principal executive officer)
By:	*
	Name:	Donna J. Stawarz
	Title:	Controller (principal financial and accounting officer)
CHRYSLER GROUP LLC, as sole Member
By:	/S/    KENNETH D. NILSON
	Name:	Kenneth D. Nilson
	Title:	Acting Treasurer

*By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title	Attorney-in-Fact

II-18

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Auburn Hills, State of Michigan, on April 1, 2014.

GLOBAL ENGINE MANUFACTURING ALLIANCE LLC
By:	/S/    KENNETH D. NILSON
	Kenneth D. Nilson
	Vice President & Treasurer

Pursuant to the requirements of the Act, this Registration Statement has been signed by the following persons in the capacities indicated on the 1st day of April, 2014.

By:	*
	Name:	Tania Pratnicki Young
	Title:	Managing Director (principal executive officer)
By:	/S/    TROY K. JOHNSON
	Name:	Troy K. Johnson
	Title:	Controller (principal financial and accounting officer)
By:	*
	Name:	Brian Harlow
	Title:	Director

*By:	/S/    MARJORIE H. LOEB
	Name:	Marjorie H. Loeb
	Title	Attorney-in-Fact

II-19