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Text of the Kerkorian lawsuit against DaimlerChrysler AG

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE TRACINDA CORPORATION, a Nevada corporation, Plaintiff,

v.

DAIMLERCHRYSLER AG, a Federal Republic of Germany corporation; DAIMLER-BENZ AG, a Federal Republic of Germany corporation; JUERGEN SCHREMPP, a citizen of the Federal Republic of Germany; MANFRED GENTZ, a citizen of the Federal Republic of Germany; HILMAR KOPPER, a citizen of the Federal Republic of Germany; Defendants. )

COMPLAINT FOR FEDERAL SECURITIES LAW VIOLATIONS, COMMON LAW FRAUD AND CONSPIRACY, COMPENSATORY DAMAGES, PUNITIVE DAMAGES AND RESCISSION

JURY TRIAL DEMANDED

NATURE OF THE ACTION

1. To close one of the largest transactions in the history of the automotive industry, defendants Daimler-Benz AG ("Daimler-Benz") and DaimlerChrysler AG ("DaimlerChrysler") blatantly lied to all concerned in a scheme masterminded by defendant Juergen Schrempp, the long-time chairman and chief executive officer of Daimler-Benz, and implemented by the companyís executive inner circle, including defendants Manfred Gentz and Hilmar Kopper (collectively, Messrs. Schrempp, Gentz and Kopper shall be referred to as the "Daimler Defendants"). Mr. Schrempp and his companies lied to the United States Securities and Exchange Commission ("SEC"), lied to Chrysler Corporationís ("Chrysler") board of directors, lied to the investing public and lied to Chryslerís single largest shareholder, plaintiff Tracinda Corporation ("Tracinda").

2. Mr. Schrempp knew that Chryslerís directors and shareholders would never approve a transaction if he told the truth, namely, that a foreign corporation sought to acquire complete operating control of one of Americaís "Big Three" auto manufacturers. So, in a series of moves executed with a chessmasterís precision, Mr. Schremmp set his plan in motion. Initially, he told Chrysler that Daimler-Benz contemplated a true "merger of equals" in which Daimler-Benz and Chrysler would operate as two equal companies with Chryslerís management continuing to run U.S. operations and having parity in all respects to Daimler-Benzís management with equal representation on the management team of the combined companies. At the same time, he approached Kirk Kerkorian through Robert Eaton, then Chryslerís chairman and chief executive officer. Mr. Kerkorianís company, Tracinda, owned approximately 13.75% of Chryslerís common stock at the time. Knowing that Chrysler and Wall Street would look to Mr. Kerkorianís recommendation before approving the merger, he also promised Mr. Kerkorian that this transaction would constitute a "merger of equals," again representing that Daimler-Benz and Chrysler would be run by their own management constituencies, that Chryslerís management would continue to run U. S. operations, and that Mr. Eaton would be Co-CEO for at least three years following the merger.

3. Daimler-Benzís assurances formed the foundation for Tracindaís decision to vote in favor of the business combination between Daimler-Benz and Chrysler for two principal reasons. First, the value of the stock which Tracinda and all Chrysler shareholders would receive as part of the merger depended on the continuing support of Chryslerís management team which had brought Chrysler back from bankruptcy to an extremely profitable operation in only a few short years. Second, the price or exchange ratio for a "merger of equals" was well below the price or "acquisition premium" which would have been paid to all shareholders of Chrysler, if the transaction had been viewed by Wall Street as a traditional takeover. Had Mr. Kerkorian known the truth, Tracinda would never have agreed to vote all of its shares for the merger. Significantly, Chryslerís board would never have approved the merger without Tracindaís approval and the transaction would never have closed.

4. Having secured the approval of Chryslerís board of directors and Tracinda, Mr. Schremmp, with the assistance of Messrs. Gentz and Kopper, solicited all of the public shareholders by causing Daimler-Benz and DaimlerChrysler to prepare and file a registration statement with the SEC in August 1998 which repeated and reinforced all of their earlier promises to Chrysler and Tracinda. The strategy succeeded because, at a meeting held in September 1998 in Wilmington, Delaware, Chryslerís stockholders approved the merger by a wide margin and the transaction closed in November 1998.

James P. Holden5. Unbeknownst to Tracinda, defendants never intended the transaction to be a merger of equals and never intended to have Chrysler run as an independent and co-equal operation. To the contrary, defendants always intended to relegate Chrysler to the status of a "division," always intended to fire Chryslerís management and always intended to replace them with executives from their headquarters in Stuttgart. This plan culminated on Friday, November 17, 2000, when Mr. Schrempp fired James P. Holden from his post as chief executive officer of Chryslerís operation in North America, and replaced Mr. Holden with Dieter Zetsche and Wolfgang Bernhard, two of Mr. Schremppís former lieutenants. All told, by Thanksgiving, Mr. Schrempp had fired almost all of Chryslerís top executives and now feels free to exercise openly his control over the combined companies. His cavalier attitude toward the American executives who believed his prior promises and the welfare of Chryslerís employees has so devastated the company that Mr. Schrempp has been forced to apologize to over 400 of Chryslerís managers to maintain order and in an effort to prevent the further downward spiral of DaimlerChryslerís stock which has dropped approximately 18 % in the last three weeks.

6. The Court does not need to look too far for the proof behind Tracindaís claims, because Mr. Schrempp already has admitted to his fraudulent conduct and even has explained his previously unspoken motivations. In an interview with the Financial Times, published on October 30, 2000, Mr. Schrempp confessed that he lied because he knew that Chryslerís management never would have approved the transaction if they were told that he planned to replace them with former Daimler-Benz executives and relegate Chrysler to a mere "division" of DaimlerChrysler along with other operations of pre-merger Daimler-Benz. Cynically describing his strategy of deception, Schrempp is quoted as saying:

"Me being a chess player, I donít normally talk about the second or third move. The structure we have now with Chrysler (as a standalone division) was always the structure I wanted. We had to go a roundabout way but it had to be done for psychological reasons. If I had gone and said Chrysler would be a division, everybody on their side would have said there is no way weíll do a deal. But itís precisely what I wanted to do. From the start structure, we have moved to what we have today."

However, arrogance and deceit do not constitute affirmative defenses under the federal securities laws. Mr. Schrempp denied Chryslerís shareholders their right to vote on the merger and denied them their rightful acquisition premium, and he now must be forced to pay for the damage which he caused and to relinquish control of the company which he stole.

7. To provide a meaningful remedy, Tracinda asks the Court to award actual damages which include the acquisition premium that defendantsí misrepresentations concerning a "merger of equals" denied Tracinda, under Section 10(b) of the Securities Exchange Act of 1934; to award "rescissory" damages which represent the difference between the value of the common stock of Chrysler that Tracinda exchanged in the merger and the present value of the stock that Tracinda now owns in DaimlerChrysler, under Sections 11 and 12(a)(2) of the Securities Act of 1933; to award compensatory and punitive damages in an amount sufficient to punish and make an example of defendants for lying to all of Chryslerís shareholders, and the investing public at large, under common law fraud and conspiracy; and to unwind the transaction in order to allow Chrysler once again to exist as an independent corporation owned by Chryslerís shareholders, and to return all value, including distributions, which DaimlerChrysler caused Chrysler to transfer since the merger, under Section 14(a) of the Securities Exchange Act of 1934.

JURISDICTION

8. Tracinda asserts claims under Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act"), 15 U.S.C. ß 78j(b), and Rule 10b-5 promulgated thereunder, 17 C.F.R. ß 240.10b-5; Section 20(a) of the Exchange Act, 15 U.S.C. ß 78t(a); Section 14(a) of the Exchange Act, 15 U.S.C. ß 78n(a) and Rule 14a-9 promulgated thereunder; 17 C.F.R. ß 240.14a-9; Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 (the "Securities Act"), 15 U.S.C. ßß 77k, 77l(a)(2) & 77o; and for common law fraud and conspiracy. This Court has jurisdiction over this action pursuant to Section 27 of the Exchange Act, 15 U.S.C. ß 78aa; Section 22 of the Securities Act, 15 U.S.C. ß 77v; 28 U.S.C. ß 1331; and the doctrine of supplemental jurisdiction, 18 U.S.C. ß 1367. Additionally, the Court has jurisdiction over this action pursuant to 28 U.S.C. ß 1332(a)(2), because the amount in controversy exceeds the sum of $75,000, exclusive of interest and costs, and is between a citizen of a State and citizens of a foreign state.

VENUE

9. Venue is proper in this judicial district pursuant to the terms of a certain stockholder agreement, dated as of May 7, 1998 (the "Stockholder Agreement"), between and among Daimler-Benz, Chrysler and Tracinda, which provides in pertinent part that Daimler-Benz, Chrysler and Tracinda consent "to the personal jurisdiction of any federal court located in the State of Delaware or any Delaware state court in the event any dispute arises out of or relates to this Agreement or any of the transactions contemplated by this Agreement" and agreed that they would "not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, including, without limitation, a motion to dismiss on the grounds of forum non conveniens . . . ." The Stockholder Agreement also provides for the application of the laws of the State of Delaware: "[t]his Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to the principles of conflicts of law thereof." Additionally, venue is proper in this judicial district pursuant to Section 27 of the Exchange Act, 15 U.S.C. ß 78aa, and 28 U.S.C. ß 1391(b), because the transactions which gave rise to this action occurred in substantial part in the District of Delaware, and defendants conduct or transact business in the District of Delaware.

PARTIES AND OTHER CONCERNED PERSONS

10. Chrysler was a corporation organized and existing under the laws of the State of Delaware, with its principal executive offices located at 1000 Chrysler Drive, Auburn Hills, Michigan. Until November 17, 1998, Chrysler was the issuer of common stock trading on the New York Stock Exchange under the trading symbol "C."

11. Tracinda is a corporation organized and existing under the laws of the State of Nevada, with its principal place of business located in Beverly Hills, California. Prior to the merger, Tracinda was Chryslerís largest shareholder. Kirk Kerkorian is and at all times relevant hereto has been the chairman, chief executive officer and sole shareholder of Tracinda. Mr. Kerkorian is a citizen of the State of California.

12. Daimler-Benz was a stock corporation organized and existing under the laws of the Federal Republic of Germany, with its principal place of business located at Epplestrasse 225, Stuttgart, Germany. Until November 17, 1998, Daimler-Benz was the issuer of American Depository Shares of stock trading on the New York Stock Exchange under the trading symbol "DAI," as well as of common stock trading on the Frankfurt Stock Exchange.

13. DaimlerChrysler is and was at all relevant times a stock corporation organized and existing under the laws of the Federal Republic of Germany, with its headquarters located at Epplestrasse 225, Stuttgart, Germany. DaimlerChrysler is the issuer of common stock which is presently traded on the New York Stock Exchange under the trading symbol "DCX," as well as on various other stock exchanges throughout the United States and the world. DaimlerChrysler is the successor-in-interest to all duties, obligations and liabilities of Daimler-Benz.

14. Juergen Schrempp is a citizen of the Federal Republic of Germany. Since November 17, 1998, Mr. Schrempp has been the "co-chairman" and "co-chief executive officer" of DaimlerChrysler. At all times relevant before the merger, Mr. Schrempp was the chairman and chief executive officer of Daimler-Benz. Mr. Schrempp signed the registration statement with regard to the shares of DaimlerChrysler common stock issued to Chryslerís stockholders in accordance with the terms of the merger.

15. Manfred Gentz is a citizen of the Federal Republic of Germany. Tracinda is further informed and believes and on that basis alleges herein that Mr. Gentz has been a member of the DaimlerChrysler Management Board since the merger. At all times relevant, Mr. Gentz served as Daimler-Benzís chief financial officer and as a member of Daimler-Benzís Management Board. Mr. Gentz signed the registration statement with regard to the shares of DaimlerChrysler common stock issued to Chryslerís stockholders in accordance with the terms of the merger.

16. Hilmar Kopper is a citizen of the Federal Republic of Germany. Tracinda is further informed and believes and on that basis alleges herein that Mr. Kopper is chairman of the DaimlerChrysler Supervisory Board and has been a member thereof since the merger. Mr. Kopper is also Chairman of the Supervisory Board and a member of the Supervisory Boardís Presiding Committee of Deutsche Bank, which was the largest shareholder of Daimler-Benz before the merger. Tracinda is informed and believes and on that basis alleges herein that Mr. Kopper served as one of Mr. Schremppís close personal advisors and played an instrumental role with regard to the negotiation and structuring of the merger. Tracinda is further informed and believes and on that basis alleges herein that Mr. Kopper was involved directly or indirectly in all of Daimler-Benzís material decisions regarding the merger. In this regard, on May 6, 1998, Mr. Kopper and Mr. Schrempp met with Mr. Eaton at Deutsche Bankís headquarters in Frankfurt, Germany to review the terms of the merger one last time before the transaction was publicly announced.

COMMON FACTUAL ALLEGATIONS

(Daimler-Benz and Mr. Schrempp Make Misrepresentations to Tracinda Through Chrysler)

17. In or about mid-January 1998, Mr. Schrempp approached Robert Eaton, then-chairman and chief executive officer of Chrysler, while Mr. Schrempp was attending the Detroit International Auto Show and suggested that Chrysler consider the possibility of a business combination with Daimler-Benz. After this initial discussion with Mr. Schrempp, on or about February 2, 1998, Mr. Eaton met personally with Kirk Kerkorian, the sole stockholder of Tracinda which held at that time approximately 13.75% of Chryslerís common stock, to discuss his conversation with Schrempp.

18. On or about February 12, 1998, Mr. Eaton and Mr. Schrempp spoke again. During this conversation, Mr. Eaton made clear and Mr. Schrempp agreed that any business combination between Daimler-Benz and Chrysler would be an equal union of two powerful corporations and their respective constituencies, rather than an acquisition of one corporation by the other. In that regard, Mr. Schrempp stated to Mr. Eaton that, should a business combination between Daimler-Benz and Chrysler be effectuated, Chryslerís management would continue to run U. S. operations, the management team in place at Daimler-Benz would jointly manage the combined entity on a worldwide basis, and appropriate internal structures would be implemented to create and maintain a management system consistent with a "merger of equals" between the two companies. Mr. Eaton expressed his interest in Mr. Schremppís proposal, said that he would discuss the proposal in confidence with other Chrysler executives and other interested persons, including significant stockholders in Chrysler, and that Chrysler would get back in touch with Mr. Schrempp and Daimler-Benz to continue discussions, if appropriate. Mr. Schrempp told Mr. Eaton that he hoped further and more detailed discussions of the proposed "merger of equals" would occur in the near future. Following this conversation, on or about February 20, 1998, Mr. Eaton spoke again with Mr. Kerkorian and emphasized to Mr. Kerkorian, as Mr. Schrempp had emphasized to him, that the proposed business combination would be a "merger of equals" between Chrysler and Daimler-Benz, and that existing Chrysler management would team up with existing Daimler-Benz management to run the combined new company equally on a worldwide basis.

Mr. Kerkorian and Mr. Eaton agreed that Mr. Schremppís proposal of a "merger of equals" between Chrysler and Daimler-Benz was extremely interesting and potentially could create a great business opportunity for Chrysler and its stockholders.

19. Over the course of February, March and April 1998, Mr. Eaton, other Chrysler senior executives, and their legal and investment banking advisors met on numerous occasions with Mr. Schrempp, other Daimler-Benz senior executives, and their legal and investment banking advisors, to continue and refine in greater detail potential plans for a "merger of equals" between Chrysler and Daimler-Benz. During that same time period, Mr. Eaton had several discussions by telephone and in person with Mr. Kerkorian during which he apprised Mr. Kerkorian of the progress of the ongoing discussions between Chrysler and Daimler-Benz. Mr. Eaton reported to Mr. Kerkorian that Mr. Schrempp had repeatedly assured him throughout the negotiations that the proposed combination between Chrysler and Daimler-Benz would be a "merger of equals" with a joint post-merger management structure that would reflect and preserve that "equality." During the last of these discussions with Mr. Kerkorian, on or about April 6, 1998, Mr. Eaton advised Mr. Kerkorian that a detailed proposal for effectuating the "merger of equals" would be presented to the Chrysler board of directors for formal review in early May 1998. Mr. Eaton provided the details of his conversations with Mr. Schrempp to Tracinda with Mr. Schremppís knowledge and consent. Indeed, Mr. Schrempp insisted on keeping Mr. Kerkorian fully apprised because he knew a business combination between Daimler-Benz and Chrysler could be accomplished only with Tracindaís approval.

20. On May 6, 1998, Daimler-Benz, Chrysler and DaimlerChrysler executed an Amended and Restated Business Combination Agreement (the "BCA") which detailed the manner in which Daimler-Benz and Chrysler would "combine their respective businesses, stockholder groups, managements and other constituencies in a merger of equals transaction . . . ."

The entirety of Article IV of the BCA is devoted to "DaimlerChrysler governance after the effective time" [of the merger], the pertinent written provisions of which read as follows:

(a) "Daimler-Benz, Chrysler and DaimlerChrysler AG agree that . . . DaimlerChrysler AG shall have a corporate governance structure reflecting that the transactions contemplated herein are a merger of equals." ('4.1, preamble).

(b) The establishment of a "DaimlerChrysler AG Supervisory Board" which "shall be composed of twelve members representing the shareholders, six of whom shall have been recommended . . . by Daimler-Benz and six of whom shall have been recommended . . . by Chrysler. . . ." ('4.1(b)).

(c) The establishment of a "DaimlerChrysler AG Management Board" which "shall consist of 18 members. In general, 50% of such members shall be those designated by Chrysler, and 50% of such members shall be those designated by Daimler-Benz. . . ." ('4.1(c)).

(d) "For three years following the [merger], Juergen E. Schrempp and Robert J. Eaton shall be Co-CEOs and Co-Chairmen . . . of the Management Board . . . of DaimlerChrysler AG and members of the Office of the Chairmen of DaimlerChrysler AG." ('4.1(d).

(e) The establishment of an "Integration Committee" which "shall consist of the co-chairmen of the Management Board of DaimlerChrysler AG. . . and 12 or more members . . . , 50% of which shall be designated by Chrysler and 50% of which shall be designated by Daimler-Benz." ('4.2).

(f) The establishment of "two operational headquarters: one located at the current headquarters of Daimler-Benz, and one located at the current headquarters of Chrysler." ('4.3).

21. One day later, on May 7, 1998, Daimler-Benz, Chrysler and Tracinda executed a Stockholder Agreement pursuant to which Tracinda agreed to vote all of its Chrysler common stock in favor of the merger between the two companies as recommended by the Chrysler board of directors. But for Daimler-Benzís representation that the transaction was a merger of equals, Tracinda would not have executed the Stockholder Agreement. Further, Chryslerís directors considered Tracindaís support of the merger and agreement to vote all of its Chrysler shares in favor of the merger to be a material factor in their own decision to endorse the transaction. (Proxy Statement/Prospectus, at 52.)

(The Registration Statement and Proxy Statement/Prospectus Contain False Statements)

22. On or about August 6, 1998, Daimler-Benz, DaimlerChrysler and the Daimler Defendants caused to be filed with the SEC a registration statement under the Securities Act of 1933 on Form F-4 listing the registrant as "DAIMLERCHRYSLER AG as successor corporation to DAIMLER-BENZ AKTIENGESELLSCHAFT." The registration statement contained a proxy statement and prospectus (collectively, the registration statement, proxy statement and prospectus shall be referred to as the "Proxy Statement/Prospectus") which, according to its terms, was being furnished to holders of shares of common stock in Chrysler, relating to the offering and issuance of "Ordinary Shares, no par value" by DaimlerChrysler, as part of a series of transactions "which together will have the effect of combining the respective businesses, stockholder groups, managements and other constituencies of Chrysler and Daimler-Benz in a "merger-of-equals" transaction." (Proxy Statement/Prospectus, at 1.)

23. The Proxy Statement/Prospectus stated that a special meeting of the stockholders of Chrysler would be held in Wilmington, Delaware on September 18, 1998 to consider and vote upon a proposal to approve the aforementioned business combination involving Chrysler and Daimler-Benz (the "Chrysler-Daimler-Benz Merger"), which if consummated would leave the former Chrysler stockholders (as well as former Daimler-Benz shareholders) as stockholders in the new entity known as DaimlerChrysler AG.

24. The Proxy Statement/Prospectus stated that the board of directors of Chrysler had unanimously approved the Chrysler-Daimler-Benz Merger as "fair to and in the best interests of Chrysler and Chryslerís shareholders" and hence recommended its adoption by Chrysler shareholders. The Proxy Statement/Prospectus also stated that the Chrysler-Daimler-Benz Merger would leave the former stockholders of Chrysler owning approximately 42% of the outstanding stock of DaimlerChrysler, through an exchange of 0.6235 of a DaimlerChrysler "Ordinary Share" for each share of Chrysler common stock. The Proxy Statement/Prospectus also stated that the "affirmative vote of a majority" of the common stockholders of Chrysler (as of the July 20, 1998 record date) was needed for approval of the Chrysler-Daimler-Benz Merger. (Proxy Statement/Prospectus, at 43.)

25. The Proxy Statement/Prospectus stated that Chryslerís single largest shareholder, Tracinda, which as of July 30, 1998 owned 71,753,992 shares (or approximately 11%) of Chryslerís common stock, had entered into the Stockholder Agreement with Daimler-Benz and Chrysler, pursuant to which Tracinda had promised to vote all of its shares in favor of the Chrysler-Daimler-Benz Merger. (Proxy Statement/Prospectus, at 44.)

26. The Proxy Statement/Prospectus consistently repeated that the Chrysler-Daimler-Benz Merger would be a "merger-of-equals" transaction. (See, e.g., Proxy Statement/Prospectus, at Preface, 11, 16, 47, 48, 51, 57, 65 & 93.) In this regard, the Proxy Statement/Prospectus made specific representations regarding the manner in which DaimlerChrysler would be governed:

(a) Ultimately, the Supervisory Board of DaimlerChrysler would consist of twenty members: five from the Daimler-Benz supervisory board, five from outsider members of the Chrysler board of directors, and the remaining ten would be employee representatives. (Proxy Statement/Prospectus, at 16.)

(b) For at least two years after the effective date of the Chrysler-Daimler-Benz Merger, the then-current chairman of the Daimler-Benz supervisory board (Mr. Kopper) would continue as chairman of the DaimlerChrysler Supervisory Board. (Proxy Statement/Prospectus, at 16.)

(c) DaimlerChrysler would have a "Management Board" consisting of eighteen members, half to be designated by Chrysler and half to be designated by Daimler-Benz, with two additional members responsible for managing Daimler-Benzís non-automotive businesses. (Proxy Statement/Prospectus, at 16.)

(d) For three years following consummation of the Chrysler-Daimler-Benz Merger, Schrempp and Robert J. Eaton (the chairman and chief executive officer of Chrysler) would serve as "Co-CEOs" and "Co-Chairmen" of the DaimlerChrysler Management Board and as members of the so-called "Office of the Chairmen of DaimlerChrysler AG." (Proxy Statement/Prospectus, at 16-17.)

(e) The DaimlerChrysler Management Board would establish an "Integration Committee" (later known as the "Shareholders Committee") of twelve or more members, half designated by Daimler-Benz and half by Chrysler, including the Co-Chairmen of the Management Board. (Proxy Statement/Prospectus, at 17.)

(f) Following the consummation of the Chrysler-Daimler-Benz Merger, DaimlerChrysler "shall maintain two operational headquarters, one located at the current headquarters of Daimler-Benz, and one located at the current headquarters of Chrysler [in Auburn Hills, Michigan.]" (Proxy Statement/Prospectus, at 17.)

(g) According to the Proxy Statement/Prospectus, "English shall be the official language for the management of DaimlerChrysler" following the consummation of the Chrysler-Daimler-Benz Merger. (Proxy Statement/Prospectus, at 17.)

27. Consistent with the foregoing representations concerning the manner in which corporate governance of DaimlerChrysler would be implemented, the Proxy Statement/Prospectus contained a long section describing the history of the discussions between Mr. Schrempp and Daimler-Benz, on the one hand, and Chrysler management, on the other hand, that culminated with the Chrysler-Daimler-Benz Merger. In this regard, the Proxy Statement/Prospectus stated as follows:

(a) Negotiations had begun in mid-January 1998, when Schrempp visited Mr. Eaton in Detroit and "suggested it might be mutually beneficial if Daimler-Benz and Chrysler were to consider the possibility of a business combination." (Proxy Statement/Prospectus, at 47.)

Subsequently, over the course of February 1998, Mr. Eaton and other senior Chrysler executives met on several occasions with Mr. Schrempp and other members of the Daimler-Benz management board. According to the Proxy Statement/Prospectus, "[d]uring the course of these discussions and thereafter, representatives of Chrysler stated that it was important to Chrysler that any potential transaction maximize value for its stockholders, that it be tax-free to Chryslerís U.S. stockholders and tax efficient for DaimlerChrysler AG, that it have the post-merger governance structure of a "merger-of-equals," that it result in the combination of the respective businesses of Daimler-Benz and Chrysler into one public company and that it limit any post-effective contingencies. . . ." (Proxy Statement/Prospectus, at 47, emphasis added.)

(b) Over the course of March and April 1999, representatives of Chrysler and Daimler-Benz, together with their respective legal and investment banking advisors, met in Switzerland and London, among other locations, to continue and refine merger discussions. The Proxy Statement/Prospectus stated that the "major points" of discussion during that period and thereafter involved, among other things, "identifying a governance structure that would take into account the partiesí goal of incorporating the best U.S. and German practices" and "creating a management organization for the combined company that achieves a meaningful sharing of management roles consistent with the partiesí conception of the Transactions as a ëmerger of equals.í" (Proxy Statement/Prospectus, at 48.)

(c) Chrysler and Daimler-Benz concluded that the proposed Chrysler-Daimler-Benz Merger would be more likely to win approval from "important constituencies of Daimler-Benz" if the combined parent company were a German stock corporation: "Consequently, the parties decided that a new company organized under the laws of . . . Germany should be the new public parent company and that the Transactions would be the best means to accomplish the partiesí objectives for a business combination transaction, including implementing a merger of equals combining both companiesí businesses, stockholder groups, managements and other constituencies, and further that the governance structure that had been discussed would be an appropriate management structure for the combined company in the future." (Proxy Statement/Prospectus, at 49; emphasis added.)

(d) Subsequently, in early May 1998, the Chrysler board of directors reviewed and approved the written documentation for effectuating the Chrysler-Daimler-Benz Merger. (Proxy Statement/Prospectus, at 49.) According to the Proxy Statement/Prospectus, among the key material factors that led to the approval by the Chrysler board was "[t]he "merger-of-equals" corporate governance structure contemplated by the Combination Agreement, which, in the view of the Chrysler Board, means that Chryslerís directors and senior management will be in a position to help bring about the realization of the enhanced growth prospects and synergies expected from the combination of the two companies, for the benefit of stockholders of DaimlerChrysler AG (including former stockholders of Chrysler)." (Proxy Statement/Prospectus, at 51.)

(e) At the same time, on May 6 and 14, 1998, the Daimler-Benz supervisory board met in Stuttgart for detailed briefing and discussion of the strategic reasons behind the proposed merger, "including, among other things, general consolidation in the automotive industry and the strong potential for synergies between the constituent companies, the company profile of Chrysler, the transaction structure, organizational issues relating to the structure and composition of the DaimlerChrysler Management Board and Supervisory Board and the prospects for enhancing the value of the combined entity in the future." (Proxy Statement/Prospectus, at 49.)

(The Defendants Implement Their Secret Plan To Assume Sole Control Of DaimlerChrysler)

28. On or about September 18, 1998, at a stockholdersí meeting held in Wilmington, Delaware, 475,771,250 shares of Chrysler were voted in favor of the Chrysler-Daimler-Benz Merger, which constituted 97% of the common stock which voted on the transaction. On or about November 17, 1998, pursuant to the Proxy Statement/Prospectus, the common stockholders of Chrysler, including Tracinda, received shares of DaimlerChrysler stock in exchange for their shares of common stock in Chrysler. Had Tracinda known that defendants did not intend to honor their promises and that their true intentions were to fire Chryslerís management and reduce the company to "division" status, Tracinda would not have voted in favor of the merger and would not have exchanged its stock.

29. Defendants knew that they could not act immediately to subordinate Chrysler and its executives to direct control by Daimler-Benz and its executives, because they would risk embarrassing litigation which could potentially cause the unraveling of the Chrysler-Daimler-Benz Merger and, hence, frustrate the secret plan espoused by Mr. Schrempp to subjugate and exploit Chrysler. Accordingly, defendants privately resolved to undercut the influence and autonomy of the Chrysler executives and other Chrysler constituencies within DaimlerChrysler on a gradual, insidious basis over an extended period of time, while paying lip service to the corporate governance protocols touted to Chryslerís directors and management in the BCA and Chryslerís former shareholders in the Proxy Statement/Prospectus, as well as Daimler-Benzís earlier representations to Tracinda through Chrysler to induce Tracinda to sign the Stockholder Agreement.

30. To conceal their fraud and otherwise lull Tracinda, among others, into a false sense of complacency after the consummation of the Chrysler-Daimler-Benz Merger, defendants allowed Mr. Eaton to assume a position as "Co-CEO" and "Co-Chairman" of DaimlerChrysler, allowed certain other individuals nominated by Chrysler to assume positions on the Supervisory Board and Management Board of DaimlerChrysler, and permitted certain Chrysler executives to remain in charge of Chrysler operations.

31. Thereafter, over the course of late 1999 and 2000, defendants took certain steps to decrease the influence and autonomy of the Chrysler constituencies within DaimlerChrysler, but did so in a manner calculated to mask their true intentions and to avoid alerting Tracinda and the other shareholders, as well as Chryslerís management, to the fact that the entire proposed corporate governance structure for the combined companies had been a sham. As part of the affirmative steps taken to conceal their secret plans, Mr. Schrempp told Chrysler executives in mid-September 1999 that the management structure of Daimler-Benz needed to be streamlined in order to promote greater efficiency. Tracinda never suspected and could never have uncovered defendantsí true intentions, because Mr. Schrempp and DaimlerChrysler always came up with a seemingly legitimate business reason for terminating or transferring a Chrysler executive.

32. To supposedly streamline operations, in late September 1999, DaimlerChrysler announced that Theodor Cunningham (in charge of sales and marketing for Latin America) and Kurt Lauk (in charge of commercial vehicle operations) would leave the Management Board, with their responsibilities to be assumed by other Management Board members. In this regard, DaimlerChrysler charged James Holden, a long-standing Chrysler executive and member of the Management Board, with assuming Mr. Cunninghamís responsibilities, and Dieter Zetsche, a trusted associate of Mr. Schrempp and member of the Management Board, assumed Mr. Laukís responsibilities. Subsequently, in or about October 1999, DaimlerChrysler fired Thomas Stallkamp, a veteran Chrysler executive, president of DaimlerChrysler operations in the United States, and a member of the Management Board.

Tracinda is informed and believes and alleges on that basis herein that Mr. Stallkamp was and had been a vocal proponent of Chrysler constituencies, and had criticized management decisions espoused by Daimler-Benz executives when he saw fit, and accordingly was targeted for termination by Mr. Schrempp for those reasons. At the same time, Mr. Schrempp caused Mr. Holden to be appointed Mr. Stallkampís successor as president of DaimlerChrysler operations in the United States. Although Mr. Holdenís replacement of Mr. Stallkamp was intended by Mr. Schrempp superficially to pacify anxiety on the part of Chrysler employees, stockholders and other observers that a non-Chrysler executive would be put in charge of United States operations, unbeknownst to Tracinda, defendants had taken another step in their plan to gradually remove executives who were a product of the Chrysler corporate culture and were likely to support Chrysler constituencies within DaimlerChrysler. In this instance, because Mr. Holden already had a seat on DaimlerChryslerís Management Board, Mr. Stallkampís removal created a vacancy which decreased the number of seats held by former Chrysler executives, thus increasing the control which Mr. Schrempp, Mr. Gentz and Mr. Kopper had over DaimlerChrysler.

33. On Tuesday, November 14, 2000, DaimlerChrysler announced that Mr. Holden would be fired from his post as president of U.S. operations. On Friday, November 17, 2000, after a meeting of the DaimlerChrysler Management Board, Mr. Holdenís termination was formally implemented, and DaimlerChrysler simultaneously announced that Messrs. Zetsche and Bernhard would assume control of DaimlerChryslerís U.S. operations as president and chief operating officer, respectively. Most recently, on November 21, 2000, DaimlerChrysler announced that three more top American executives from Chryslerís management team had been terminated: Kathleen Oswald, Chryslerís chief administrative officer and one of the auto industryís highest ranking female executives, Theodor Cunningham, Chryslerís executive vice president of global sales, and Antonio Cervone, head of Chryslerís global communications. With the firing of Mr. Holden and his replacement with long-standing Daimler-Benz executives, along with the termination of those other key executives, defendants have unambiguously acted in a manner demonstrating that there is no "merger of equals" between Chrysler and Daimler-Benz, and that henceforth Chrysler constituencies and operations within DaimlerChrysler would be controlled directly by former Daimler-Benz executives reporting to Mr. Schrempp.

(Mr. Schrempp Admits That He Lied)

34. Only a few days before DaimlerChrysler announced the firing of Mr. Holden, on October 30, 2000, the Financial Times, a business news publication based in the United Kingdom, published an article (the "October 30th Article") written by Tim Burt and Richard Lambert, which recounted certain details of the reportersí interview of Mr. Schrempp. The admissions by Mr. Schrempp in this interview provide clear and convincing evidence that he had lied to secure Tracindaís signature on the Stockholder Agreement and had lied within the Proxy Statement/Prospectus to induce all of Chrysler shareholders, including Tracinda, to exchange their shares. Tracinda attaches, as Exhibit "A" hereto, a true and correct copy of the October 30th Article which reads in pertinent part as follows:

In a wide-ranging interview ahead of this weekís two day meeting [of the Daimler-Chrysler Management Board], he [Mr. Schrempp] delivered a passionate defense of both the merger and his ambition to create a global carmaker. [] In doing so, however, he admitted that Chrysler had been relegated to a standalone division. Far from being "a merger of equals", as originally conceived, the deal has emerged as just one deal among several from the "executive war-room" of Daimler-Benzís Stuttgart headquarters. [] Now that most of Chryslerís old management board has resigned or retired, Mr. Schrempp sees no reason to maintain the fiction. "Me being a chess player, I donít normally talk about the second or third move. The structure we have now with Chrysler (as a standalone division) was always the structure I wanted, he says. "We had to go a roundabout way but it had to be done for psychological reasons. If I had gone and said Chrysler would be a division, everybody on their side would have said: ëThere is no way weíll do a deal.í" [] "But itís precisely what I wanted to do. From the start structure, we have moved to what we have today." [] What DaimlerChrysler has today is a US division where vehicle design, procurement, production and marketing are being overhauled. Mr. Schrempp maintains this was always the plan following the initial post-merger integration which generated about Dollars 1.4bn (Pounds 970m) in savings. (October 30th Article, at 1-2.)

35. With the publication of the October 30th Article, Tracinda first learned that Daimler-Benz had fraudulently induced Tracinda to sign the Stockholder Agreement and that Daimler-Benz and DaimlerChrysler had misrepresented the true nature of the management structure of the combined companies in connection with the exchange of Chrysler common stock for shares of DaimlerChrysler common stock as part of the merger.

36. Contemporaneously, Mr. Schrempp also was being interviewed by a panel of editors from Barronís magazine, a worldwide financial weekly. In an article published on November 4, 2000, Mr. Schrempp again admitted that he lied about Daimler-Benzís merger with Chrysler: "[w]e said in spirit it was a merger of equals, but in our minds we knew how we wanted to structure the company, and today I have it. I have Daimler, and I have divisions."

FIRST CLAIM FOR RELIEF

(For violation of Section 10(b) of the Exchange Act and Rule 10b-5 Against

Daimler-Benz, DaimlerChrysler and Mr. Schrempp)

37. Tracinda incorporates by reference paragraphs 1 through 36, above.

38. Tracinda asserts this claim within one year of the date of Tracindaís discovery of the misrepresentations and omissions alleged herein, and within three years of the purchase and sale of Chrysler and DaimlerChrysler common stock, respectively, pursuant to the exchange of securities which occurred in connection with the Chrysler-Daimler-Benz Merger.

39. As alleged above, defendants, and each of them, by use of interstate commerce, the mails and one or more national securities exchange, engaged in a device, scheme or artifice to defraud and likewise engaged in actions, practices or courses of business which operated as a fraud or deceit, in connection with the purchase and sale of Chrysler common stock for common stock issued by DaimlerChrysler, as part of the consummation of the Chrysler-Daimler-Benz Merger.

40.

Without limiting the foregoing, defendants individually and collectively embarked upon a scheme to deceive or defraud investors in Chrysler common stock, including in particular Tracinda, by making various representations of material facts that were untrue or misleading in connection with Tracindaís purchase of stock in DaimlerChrysler through the exchange of its Chrysler stock, including the following false and misleading statements:

(a) From February through May 1998, defendants represented to Tracinda that the proposed Chrysler-Daimler Merger would be a "merger of equals," pursuant to which Tracinda and the other stockholders of Chrysler would receive fair consideration for their stockholdings in Chrysler in the form of stock in DaimlerChrysler, and pursuant to which DaimlerChryslerís corporate governance protocols would be structured and maintained in such a manner as to protect the prerogatives, interests, autonomy and relative influence of the Chrysler constituencies within DaimlerChrysler, thus protecting the value of Tracindaís investment in DaimlerChrysler; and

(b) In the Proxy Statement/Prospectus, defendants represented to Tracinda that the proposed Chrysler-Daimler Merger would be a "merger of equals," pursuant to which Tracinda and the other stockholders of Chrysler would receive fair consideration for their stockholdings in Chrysler in the form of stock in DaimlerChrysler, and pursuant to which DaimlerChryslerís corporate governance protocols would be structured and maintained in such a manner as to protect the prerogatives, interests, autonomy and relative influence of the Chrysler constituencies within DaimlerChrysler, thus protecting the value of Tracindaís investment in DaimlerChrysler.

41. Defendants knew such representations were false and misleading, because Daimler-

Benz and DaimlerChrysler, along with the Daimler Defendants, already had decided to take total control over Chrysler, to reduce or eliminate the influence of Chrysler management on the affairs of DaimlerChrysler, to relegate Chrysler to division status, and to conceal this secret objective from Tracinda, other Chrysler shareholders, Chrysler management, and the rest of the investing world, until such time as defendants had completed their plan.

42. The representations detailed hereinabove were reasonably relied upon by Tracinda in exchanging its shares of Chrysler common stock for shares of DaimlerChrysler common stock. Moreover, as a direct and proximate result of defendantsí misrepresentations and omissions, Tracinda was deceived into forsaking the "acquisition premium" that Tracinda would have demanded for the sale of its Chrysler shares in connection with a change in control or complete acquisition of Chrysler.

43. Tracinda is informed and believes and on that basis alleges herein that each of the defendants participated in the preparation and/or distribution of the false representations.

44. As a direct and proximate result of these defendantsí unlawful conduct in violation of Section 10(b) and Rule 10b-5, Tracinda has been damaged and continues to be damaged in an amount not yet fully determinable, but at least in the amount of the diminution in value of its shares of Chrysler common stock and its shares of Daimler/Chrysler common stock, plus the merger premium which Daimler-Benz misappropriated. Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

SECOND CLAIM FOR RELIEF

(For Violation Of Section 20 of the Exchange Act Against The Daimler Defendants)

45. Tracinda incorporates paragraphs 1 through 36 and 38 through 44, above.

46.

Messrs. Schrempp, Gentz and Kopper participated in the preparation and/or dissemination of the foregoing false representations by providing information or approving their substance.

47. Messrs. Schrempp, Gentz and Kopper are controlling persons with respect to Daimler-Benz and DaimlerChrysler regarding the contents of the misrepresentations made to Tracinda, within the meaning of Section 20 of the Exchange Act, because they had the authority or power to control or influence the conduct of Daimler-Benz and DaimlerChrysler.

48.

Messrs. Schrempp, Gentz and Kopper knew or should have known of the violations of Section 10(b) of the Exchange Act as set forth in the First Claim for Relief, above.

49.

Messrs. Schrempp, Gentz and Kopper failed to disclose to Tracinda the truth concerning the false and misleading statements contained in defendants= communications with Tracinda and failed to advise Tracinda of the omitted statements of material fact. Defendants knew these representations to be false and misleading at the time that they were made.

50. As a direct and proximate result of these defendantsí unlawful conduct, Tracinda has been damaged and continues to be damaged in an amount not yet fully determinable, but at least in the amount of the diminution in value of its shares of Chrysler common stock and its shares of DaimlerChrysler common stock, plus the acquisition premium which Daimler-Benz misappropriated.

Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

THIRD CLAIM FOR RELIEF

(For Violation Of Section 11 of the Securities Act Against

DaimlerChrysler, Mr. Schrempp and Gentz)

51. Tracinda repeats and incorporates by reference each and every allegation contained in paragraphs 1 through 50, above.

52. Tracinda asserts this claim within one year of the date that Tracinda discovered or should have discovered through the exercise of reasonable diligence, the untrue statements and omissions alleged herein, and within three years after the bona fide offering of DaimlerChrysler common stock to the public pursuant to the exchange of securities which occurred in connection with the Chrysler-Daimler-Benz Merger.

53. The Registration Statement prepared by the defendants and distributed in connection with the Chrysler-Daimler-Benz Merger was inaccurate and misleading, contained untrue statements of material facts, omitted to state other material facts necessary to make the statements made not misleading, and concealed and failed adequately to disclose material facts as described above.

54.

Tracinda purchased securities from DaimlerChrysler in a public offering by exchanging its shares of Chrysler common stock for shares of DaimlerChrysler common stock. DaimlerChrysler is the registrant of the securities issued. The defendants named herein were responsible for the contents and dissemination of the Registration Statement.

As issuer of the securities, DaimlerChrysler is strictly liable to Tracinda. Messrs. Schrempp and Gentz are joint and severally liable as signatories of the Registration Statement.

55.

As a direct and proximate result of these defendantsí unlawful course of conduct in violation of Section 11 the Securities Act, Tracinda has been damaged and continues to be damaged in an amount not yet fully determinable, but which represents the difference between the value of the common stock of Chrysler that Tracinda exchanged in the merger and the present value of the stock that Tracinda now owns in DaimlerChrysler. Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

FOURTH CLAIM FOR RELIEF

(For Violation Of Section 12(a)(2) of the Securities Act Against

DaimlerChrysler, Mr. Schrempp and Mr. Gentz)

56. Tracinda incorporates paragraphs 1 through 36, above.

57. Tracinda asserts this claim within one year of the date on which Tracinda discovered or should have discovered through the exercise of reasonable diligence, the untrue statements and omissions alleged herein, and within three years after the bona fide sale of DaimlerChrysler common stock pursuant to the exchange of securities which occurred in connection with the Chrysler-Daimler-Benz Merger.

58. Tracinda was a purchaser of common stock issued by DaimlerChrysler and offered pursuant to the Proxy Statement/Prospectus. Defendants were sellers, offerors, and/or solicitors of sales of the DaimlerChrysler stock offered pursuant to the Proxy Statement/Prospectus. The Proxy Statement/Prospectus prepared by the defendants and distributed in connection with the Chrysler-Daimler-Benz Merger was inaccurate and misleading, contained untrue statements of material facts, omitted to state other material facts necessary to make the statements made not misleading, and concealed and failed adequately to disclose material facts as described above.

59.

As a direct and proximate result of defendantsí unlawful course of conduct in violation of Section 12(a) of the Securities Act, Tracinda has been damaged and continues to be damaged in an amount not yet fully determinable, but which represents the difference between the value of the common stock of Chrysler that Tracinda exchanged in the merger and the present value of the stock that Tracinda now owns in DaimlerChrysler. Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

FIFTH CLAIM FOR RELIEF

(For Violation Of Section 15 of the Exchange Act

Against The Daimler Defendants)

60. Tracinda incorporates paragraphs 1 through 36, 50 through 52, and 55 through 56, above.

61. Messrs. Schrempp, Gentz and Kopper participated in the preparation and/or dissemination of the foregoing false representations by providing information or approving their substance.

62. Messrs. Schrempp, Gentz and Kopper are controlling persons with respect to DaimlerChrysler regarding the contents of the misrepresentations made to Tracinda, within the meaning of Sections 11 and 12(a)(2) of the Securities Act, because they had the authority or power to control or influence the conduct of DaimlerChrysler, signed the Registration Statement and/or otherwise participated in the process which allowed the offering to be completed.

63.

Messrs. Schrempp, Gentz and Kopper knew or should have known of the violations of Sections 11 and 12(a)(2) of the Securities Act as set forth in the Third and Fourth Claims for Relief, above.

64.

Messrs. Schrempp, Gentz and Kopper failed to disclose to Tracinda the truth concerning the false and misleading statements contained in defendants= communications with Tracinda and failed to advise Tracinda of the omitted statements of material fact. Defendants knew these representations to be false and misleading at the time that they were made.

65. As a consequence of these defendantsí unlawful conduct, Tracinda has been damaged and continues to be damaged in an amount not yet fully determinable, but which represents the difference between the value of the common stock of Chrysler that Tracinda exchanged in the merger and the present value of the stock that Tracinda now owns in DaimlerChrysler. Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

SIXTH CLAIM FOR RELIEF

(For Violations of Section 14(a) of the Exchange Act and Rule 14a-9

Against DaimlerChrysler, Mr. Schrempp and Mr. Gentz)

66. Tracinda incorporates Paragraphs 1 through 36, above.

67. The defendants named herein violated Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder, because these defendants solicited and permitted the use of their names to solicit proxies from Tracinda by means of a proxy statement, included within the the Proxy Statement/Prospectus, that contained statements, as set forth in greater detail herein above, which at the time and in the light of the circumstances under which they were made, were false and misleading with respect to material facts, and omitted to state material facts necessary in order to make the statements therein not false and misleading.

68. As a direct and proximate result of these defendantsí unlawful course of conduct in violation of Section 14(a) of the Exchange Act, Tracinda has sustained and will continue to sustain irreparable injury by being denied the opportunity to make an informed decision in voting on the merger for which monetary damages alone are insufficient compensation. To restore the status quo ante, Tracinda asks the Court to unwind the transaction in order to allow Chrysler once again to exist as an independent corporation owned by Chryslerís shareholders, and to order the return of all value, including distributions, which DaimlerChrysler caused Chrysler to transfer. Tracinda is prepared to tender all of the shares of DaimlerChrysler common stock which it presently owns to effectuate such a transaction.

SEVENTH CLAIM FOR RELIEF

(For Fraud in the Inducement Against Daimler-Benz and Mr. Schrempp)

69. Tracinda incorporates paragraphs 1 through 36, above.

70. By and through the course of conduct described in detail herein above, defendants represented to Tracinda that the proposed Chrysler-Daimler-Benz Merger would be a "merger of equals," pursuant to which Tracinda and the other stockholders of Chrysler would receive fair consideration for their stockholdings in Chrysler in the form of stock in DaimlerChrysler, and pursuant to which DaimlerChryslerís corporate governance protocols would be structured and maintained in such a manner as to protect the prerogatives, interests, autonomy and relative influence of the Chrysler constituencies within DaimlerChrysler, thus protecting the value of Tracindaís investment in DaimlerChrysler.

71. The representations made by defendants to Tracinda were in fact false, because Daimler-Benz and its senior management never had any serious intention of forming a "merger of equals" with Chrysler. Rather, Mr. Schrempp and the other individuals comprising Daimler-Benz senior management already had decided to take total control over Chrysler, to reduce or eliminate the influence of Chrysler management on the affairs of DaimlerChrysler, to relegate Chrysler to the subordinate role of a wholly owned subsidiary of Daimler-Benz, and to conceal this secret objective from Tracinda, other Chrysler shareholders, Chrysler management, and the rest of the investing world, until such time as defendants had completed their plan.

72. When defendants made these representations, defendants knew them to be false, and made the representations with the specific intention to deceive and defraud Tracinda and to induce Tracinda to enter into the Stockholder Agreement, and otherwise to endorse the merger.

73. Tracinda, at the time these representations were made by defendants, was ignorant of the falsity of defendants' representations and reasonably believed them to be true and made in good faith. In reliance upon defendants' misrepresentations, Tracinda entered in the Stockholder Agreement, and otherwise endorsed the merger, previously alleged hereinabove, refrained and forebore from selling its stock holdings in Chrysler on the open market, and disregarded or foreclosed itself from pursing other opportunities to influence the management of Chrysler and the common stockholders of Chrysler to reject the merger transaction offered by Daimler-Benz and to remain independent, or, alternatively, to seek from Daimler-Benz the "acquisition premium" that Tracinda would have demanded for the sale of its Chrysler shares in connection with a change in control or complete acquisition of Chrysler. Had Tracinda known the actual facts, it would never have entered into the Stockholder Agreement, would never have endorsed the merger and would never have permitted these defendants to misappropriate the value of the "acquisition premium" for themselves and subsequently to ruin, through their relegation of Chrysler to "division" status and their purge of Chryslerís management team, the value of Tracindaís enormous investment in Chrysler which has dwindled significantly in the two years since the consummation of the Chrysler-Daimler-Benz Merger.

74. As a direct and proximate result of defendants' fraudulent conduct, Tracinda has incurred general, special and consequential damages. Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

75. The fraudulent conduct of defendants was wanton, willful, and calculated to destroy the value of Tracindaís investment in Chrysler, and was performed by defendants knowingly and intentionally, in conscious violation and disregard of Tracinda's legal rights, thereby justifying an award of punitive and exemplary damages in an amount sufficient to punish and make an example of defendants for having intentionally induced Tracinda into entering the Stockholder Agreement.

EIGHTH CLAIM FOR RELIEF

(For Fraud in Connection with the Exchange of Securities Against

Daimler-Benz, DaimlerChrysler and Mr. Schrempp)

76. Tracinda incorporates paragraphs 1 through 36, above.

77. By and through the course of conduct described in detail herein above, defendants represented to Tracinda in connection with the exchange of securities pursuant to the merger that the proposed Chrysler-Daimler-Benz Merger would be a "merger of equals," pursuant to which Tracinda and the other stockholders of Chrysler would receive fair consideration for their stockholdings in Chrysler in the form of stock in DaimlerChrysler, and pursuant to which DaimlerChryslerís corporate governance protocols would be structured and maintained in such a manner as to protect the prerogatives, interests, autonomy and relative influence of the Chrysler constituencies within DaimlerChrysler, thus protecting the value of Tracinda"s investment in DaimlerChrysler.

78. The representations made by defendants to Tracinda were in fact false, because Daimler-Benz and its senior management never had any serious intention of forming a "merger of equals" with Chrysler. Rather, Mr. Schrempp and the other individuals comprising Daimler-Benz senior management already had decided to take total control over Chrysler, to reduce or eliminate the influence of Chrysler management on the affairs of DaimlerChrysler, to relegate Chrysler to the subordinate role of a wholly owned subsidiary of Daimler-Benz, and to conceal this secret objective from Tracinda, other Chrysler shareholders, Chrysler management, and the rest of the investing world, until such time as defendants had completed their plan.

79. When defendants made these representations, defendants knew them to be false, and made the representations with the specific intention to deceive and defraud Tracinda and to induce Tracinda to exchange its shares of Chrysler common stock for shares of DaimlerChrysler common stock.

80. Tracinda, at the time these representations were made by defendants, was ignorant of the falsity of defendants' representations and reasonably believed them to be true and made in good faith. In reliance upon defendants' misrepresentations, Tracinda exchanged its shares of Chrysler common stock for shares of DaimlerChrysler common stock in the merger. Had Tracinda known the actual facts, it would never have exchanged its shares and would never have permitted these defendants to misappropriate the value of the "acquisition premium" for themselves and subsequently to ruin, through their relegation of Chrysler to "division" status and their purge of Chryslerís management team, the value of Tracindaís enormous investment in Chrysler, which has dwindled significantly in the two years since the consummation of the Chrysler-Daimler-Benz merger.

81. As a direct and proximate result of defendantsí fraudulent conduct, Tracinda has incurred general, special and consequential damages. Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

82. The fraudulent conduct of defendants was wanton, willful, and calculated to destroy the value of Tracindaís investment in Chrysler, and was performed by defendants knowingly and intentionally, in conscious violation and disregard of Tracindaís legal rights, thereby justifying an award of punitive and exemplary damages in an amount sufficient to punish and make an example of defendants for having intentionally deceived the Chrysler shareholders and the investing public at large.

NINTH CAUSE OF ACTION

(For Conspiracy to Defraud Against All Defendants)

83. Tracinda incorporates paragraphs 1 through 36, 70 through 73, and 77 through 82, above.

84. Defendants, and each of them, knowingly and willfully pursued a conspiracy, common enterprise and common course of conduct between and among themselves to accomplish the foregoing unlawful acts for the purpose of (a) inducing Tracinda to enter into the Stockholder Agreement and otherwise endorsing the merger, (b) inducing Tracinda to exchange its shares of Chrysler common stock for shares of DaimlerChrysler common stock, (c) appropriating the acquisition premium for themselves, and (d) obtaining complete operating control of Chrysler.

85. Defendants, and each of them, encouraged and rendered substantial assistance to each other in accomplishing the foregoing wrongful course of conduct. In so doing, each defendant acted with full awareness of his primary wrongdoing and realized that such conduct would substantially assist the accomplishment of the wrongdoing by the other.

86. By perpetrating this civil conspiracy, defendants have caused and continue to cause Tracinda to sustain general, special and consequential damages. Tracinda will seek leave of the Court to amend this complaint to state the actual amount of damages when known.

87. Defendants, and each of them, in perpetrating this civil conspiracy, have acted with malice and calculated to destroy the value of Tracindaís investment in Chrysler, and was performed by defendants knowingly and intentionally, in conscious violation and disregard of Tracindaís legal rights, thereby justifying an award of punitive and exemplary damages in an amount sufficient to punish and make an example of defendants for having intentionally deceived the Chrysler shareholders and the investing public at large.

WHEREFORE, Tracinda requests the Court to enter judgment against defendants, jointly and severally, as follows:

1. For actual damages according to proof at trial, which includes the acquisition premium that defendantsí misrepresentations concerning the "merger of equals" denied Tracinda, under Section 10(b) of the Exchange Act of 1934.

2. For "rescissory" damages according to proof at trial, which represents the difference between the value of the common stock of Chrysler that Tracinda exchanged in the merger and the present value of the stock that Tracinda now owns in DaimlerChrysler under Sections 11 and 12(a)(2) of the Securities Act of 1933.

3. For compensatory damages according to proof at trial, plus punitive damages in an amount sufficient to punish and make an example of defendants for lying to all of Chryslerís shareholders, and the investing public at large, under common law fraud and conspiracy.

4. For an order unwinding the transaction so that Chrysler once again may exist as an independent corporation owned by Chryslerís shareholders, and returning all value, including distributions, which DaimlerChrysler caused Chrysler to transfer, pursuant to Section 14(a) of the Exchange Act of 1934.

5. For pre- and post-judgment interest in the maximum amount prescribed by law.

6. For such other and further relief as the Court may deem just and proper.

Dated: November 27, 2000

A. Gilchrist Sparks III

Jessica Zeldin

MORRIS, NICHOLS, ARSHT & TUNNELL

1201 North Market Street

Wilmington, Delaware 19899-1347

Telephone: (302)658-9200

By:

A. Gilchrist Sparks III

Attorneys for plaintiff

TRACINDA CORPORATION

OF COUNSEL:

Terry Christensen

Eric Landau

Steven J. Aaronoff

CHRISTENSEN, MILLER, FINK, JACOBS,

GLASER, WEIL & SHAPIRO, LLP

2121 Avenue of the Stars, 18th Floor

Los Angeles, California 90067-5010

Telephone: (310) 553-3000

William G. McGuinness

Douglas H. Flaum

FRIED, FRANK, HARRIS, SHRIVER & JACOBSON

One New York Plaza

New York, New York 10004

(212) 859-8170

DEMAND FOR JURY TRIAL

Pursuant to Rule 38(b) of the Federal Rules of Civil Procedure, plaintiff Tracinda Corporation ("Tracinda") hereby demands trial by jury in this action of all claims asserted against defendants Juergen Schrempp, Manfred Gentz and Hilmar Kopper as permitted by law and not inconsistent with the provisions of that certain stockholder agreement, dated May 7, 1998, between and among Tracinda, Chrysler Corporation, and Daimler-Benz AG.

Dated: November 27, 2000 A. Gilchrist Sparks III

Jessica Zeldin

MORRIS, NICHOLS, ARSHT & TUNNELL

1201 North Market Street

Wilmington, Delaware 19899-1347

Telephone: (302)658-9200

By:

_____________________________

A. Gilchrist Sparks III

Attorneys for plaintiff

TRACINDA CORPORATION

OF COUNSEL:

Terry Christensen

Eric Landau

Steven J. Aaronoff

CHRISTENSEN, MILLER, FINK, JACOBS,

GLASER, WEIL & SHAPIRO, LLP

2121 Avenue of the Stars, 18th Floor

Los Angeles, California 90067-5010

Telephone: (310) 553-3000

William G. McGuinness

Douglas H. Flaum

FRIED, FRANK, HARRIS, SHRIVER & JACOBSON

One New York Plaza

New York, New York 10004

(212) 859-8170

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