DEPARTMENT OF THE TREASURY
WASHINGTON, D.C, 20220

March 12, 2010

Ms. Nancy A. Rae

Executive Vice President-Human Resources
Chrysler Group LLC

1000 Chrysler Drive

CIMS 485-08-96

Auburn Hills, Michigan 48326-2766

Re: Supplemental Determination Regarding 2009 Compensation
Payments and Structures for Senior Executive Officers and
Most Highly Compensated Employees

Dear Ms. Rae:

This letter addresses certain matters related to determinations of the Special Master for
TARP Executive Compensation under the Department of the Treasury’s Interim Final Rule on
TARP Standards for Compensation and Corporate Governance (the “Rule”), regarding the
compensation of the senior executive officers and certain most highly compensated employees of
Chrysler Group LLC (“Chrysler”).

Pursuant to the Rule, on October 22, 2009, the Special Master issued an initial
determination (the “Initial Determination”) with respect to 2009 compensation structures and
payments for the senior executive officers and the next 20 most highly compensated employees
(“Top 25 Employees”) of Chrysler. Under the Rule, an initial determination of the Special
Master shall be treated as final unless the TARP recipient requests a reconsideration within 30
days. Because Chrysler did not request such a reconsideration, the Initial Determination became
final effective November 21, 2009.

Following the Initial Determination, on January 15, 2010, Chrysler requested approval to
alter the 2009 compensation structures for several of the Top 25 Employees. In particular,
Chrysler sought to supplement the long-term restricted stock grants approved by the Special
Master in the Initial Determination based on a comprehensive review of employee performance
during the six-month period following the company’s emergence from bankruptcy in June 2009.
Chrysler completed this review in early 2010 before granting long-term restricted stock for 2009,
which the company intends to do on or before March 15, 2010. In no event would the aggregate
grant of long-term restricted stock for a Top 25 Employee exceed one-third of that employee’s
2009 annual compensation.


The Rule requires that the Special Master determine whether the 2009 compensation
structures for Top 25 Employees “will or may result in payments that are inconsistent with the
purposes of Section 111 of EESA or TARP, or are otherwise contrary to the public interest.” 31
C.F.R. § 30.16(a)(3)(Gi) (the “Public Interest Standard”). The Rule also requires that the Special
Master consider six principles when making these compensation determinations. In particular,
the compensation structures and the amounts payable thereunder should reflect “the current or
prospective contributions of an employee to the value of the TARP recipient” and “the need for
the TARP recipient to remain a competitive enterprise, to retain ... talented employees who will
contribute to the TARP recipient’s future success, and ultimately to be able to repay TARP
obligations.” Jd. at § 30.16(b)(1).

The Special Master has determined that the compensation changes proposed by Chrysler
will not, by virtue of their structural design or the amounts potentially payable under them, result
in payments inconsistent with the Public Interest Standard. All long-term restricted stock
granted pursuant to this determination must adhere to the applicable terms and conditions set
forth in Exhibit I] to the Initial Determination, including the requirement that long-term restricted
stock may be granted only upon the achievement of specified, objective performance criteria that
have been developed and reviewed in consultation with the Office of the Special Master and
certified by Chrysler’s compensation committee.

The conclusions reached herein are limited to the authority vested in me by Section
30.16(a)(3) of the Rule, and shall not constitute, or be construed to constitute, the judgment of
the Office of the Special Master or the Department of the Treasury with respect to the
compliance of the proposed compensation structure or any other compensation structure for the
subject employee with any other provision of the Rule. Moreover, my evaluation and conclusion
have relied upon, and are qualified in their entirety by, the accuracy of the materials submitted by
Chrysler to the Office of the Special Master, and the absence of any material misstatement or
omission in such materials.

Very truly yours,

ine

Kenneth R. Feinbérg
Office of the Special Master
for TARP Executive Compensation

ce: Holly E. Leese, Esquire
Lawrence Cagney, Esquire