It’s official. Chrysler and the UAW have come to an agreement, with members of the nationwide union group ratifying an earlier proposed agreement by a strong majority. According to UAW president Ron Gettelfinger, the union realizes that the contract concessions that have just been ratified are "painful" for their active and retired workers, but the move will "help preserve U.S. manufacturing jobs and give Chrysler a chance to survive."

Perhaps the most important stipulation of the agreement is the fact that the UAW has accepted to swap around $5.3 billion of debt owed to it for an equity stake in Chrysler. This agreement would give the UAW a 55% stake in a Chrysler, and the carmaker will still owe the union group around $4.6 billion for its retiree health-care fund. Fiat will eventually gain control of around 35% of Chrysler should everything go to plan, while the federal government and a number of creditors will all share a 10% equity stake in the company.

Other important terms in the new contract include the fact that Chrysler will now be able to hire new workers for around half the wages it currently plays UAW workers. Previously, Chrysler was limited to having only 20% of workers fall into this lower paid category, but for the next six years, Chrysler will be able to hire as many of these workers as it wants. Additionally, UAW workers will have to give up certain public holidays and bonuses for the next couple of years, and their cost-of-living allowance will also be stopped, reports Automotive News.

Discussing the new development, President Barack Obama stated that he was "very hopeful" that we would eventually "see a resolution that maintains a viable Chrysler". Nevertheless, Chrysler is not out of the woods yet, and there is still the chance the company may be forced to make a bankruptcy filing.