021216 assembela bit

At a meeting held earlier today, the shareholders of Borsa Italiana S.p.A. approved several changes to market rules that will now be submitted to CONSOB for authorization.

The principal changes regard:

1. Changes in listing requirements:

• The free float will rise from 20% to 30%.
• The minimum shareholders' equity of the listed companies (including on a consolidated basis) will rise from EUR 1.5 million to EUR 3.0 million.

In the case of companies which have been in business for less than three years, the presence of institutional investors or other partners investing in the company will be required.

Such investors must hold at least a 10% share of the capital of these companies, and the relative investment must be made at least 12 months prior to the application for the listing (six months for start-up companies). The regulations relative to lock-up discipline will also apply to these investors. Exceptions to this requirement may be made in the case of companies set up as a result of extraordinary transactions or companies admitted to trading on another regulated market.

1. Introduction of corporate governance requirements

Companies currently traded on the Nuovo Mercato and companies to be traded on the Nuovo Mercato will be required to adopt several corporate governance principles contained in Borsa Italiana's Corporate Governance Code for listed Companies.

The requirements for an admission to trading will thus include the presence of:

• a board of directors consisting of a suitable number of non-executive and independent directors; the board of directors of any newly admitted company must include the presence - for a period of at least three years - of one independent director who has proven experience in the issuer's field of business;
• an internal controls committee consisting of non-executive directors, the majority of whom are independent;
• a remuneration committee.

Companies already traded on the Nuovo Mercato shall be required to put the new regulations into effect no later than the date of the shareholders' meeting held in 2004 for the purpose of approving the annual financial statements.

In order to improve the regular functioning of the market, the minimum capitalization required shall rise from EUR 5 million to EUR 20 million.

Given the increasingly internationalization of the market and the growing interest of foreign investors, companies whose shares are included in the MIB30 Index shall be required to publish all press releases in the English language.

The current rules want issuers of covered warrants or certificates to provide ongoing bid-offer prices (for all publicly traded series) for the minimum quantities established in the relative order for admission to trading.

In order to improve the issuer's activity (or the activity of the person commissioned by the issuer) to support the liquidity of the covered warrants and certificates traded on the market, Borsa Italiana may establish a maximum spread of the bids input in fulfillment of trading obligations.

Current rules provide that the opening price represents the official price on the "MOT", the part of the Exchange where Italian Government securities and non convertible bonds are traded. Following changes introduced in the Instructions in 2002 and specifically, a cutback in the time period of the auction phase in favor an increase of the continuous trading phase, the opening price is to be substituted by the average (weighted for the relative quantities) of the prices of the contracts executed during the entire trading session.

The current obligation to appoint a sponsor in the event of an application for the quotation of bonds, covered warrants, certificates and open-end indexed mutual funds is to be eliminated.

Following recent changes introduced to Borsa Italiana's Corporate Governance Code for listed Companies, the rules applicable to the STAR Segment are to be modified to incorporate such changes in relation to the establishment and operation of an internal control committee.

The new criteria for the establishment of the committee (majority of committee members to be independent directors) are to be adopted, and it will no longer be possible to delegate the responsibility for internal control to the board of directors.

As far as the evaluation of independence is concerned, the current rules are to be supplemented with a provision whereby Borsa Italiana will monitor the direct and indirect relationships between the director and the company involved.

The new rules also specify the functions of the internal control committee.

The regulations shall be directly applicable to any companies applying for admission to the STAR Segment, and shall be implemented on a gradual basis by the companies which are already part of the STAR Segment (the application of the new regulations will be effective at the very latest as of the date of the shareholders' meeting held in 2004 for the purpose of approving the annual financial statements).

According to current rules, companies not opting for the STAR Segment at the time of their initial public offerings may transfer to the segment no earlier than as of the first anniversary of the date of their quotation.

The new rules allow companies for a transfer to the STAR Segment at an earlier data (less than one year), provided the companies interested in effecting the transfer meet all of the requisites for admission to the segment.

Considering the ongoing absence of trading in the Italian Government Securities Derivatives Market ("MIF"), Borsa Italiana has approved the closure of this market as of 31 December 2002.

Milan, 16 December 2002