Fiat's access to Chrysler funds curbed by div cap, debt covenants

MILAN Mon Feb 17, 2014 2:49am EST

MILAN Feb 17 (Reuters) - Italian carmaker Fiat said on Monday that its access to finances of its U.S. unit Chrysler, of which it took control last month, was restricted by a cap on dividend distributions and debt covenants.

"Among the most significant is a cap on dividend distributions, other than distributions in respect of taxes, governed by a builder-basket equal to 50 percent of accumulated net income from Jan. 1, 2012, in addition to a one-time basket of $500 million," Fiat said in a statement.

The group also said intercompany financing was not limited other than by covenants which require that deals be approved by a majority of "disinterested" members of the Chrysler board of directors.

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