Payment of extraordinary dividend

• Stock grouping
• Stock split
• Capital increase paid - free
• Merger
• Demerger
• Conversion of shares
• Extraordinary dividend
• Delisting of contracts

On January 4th, 2010, a review of the rule and an amendment in the way derivative contracts are adjusted following the distribution of extraordinary dividends were introduced in the Rules of the Markets organised and managed by Borsa Italiana S.p.A..

Borsa Italiana shall take account of distributions of dividends, in cash or in kind, that the company classifies as additional with respect to dividends deriving from the distribution of the normal profits for the year or with respect to the normal dividend policy. If the company does not classify dividends, Borsa Italiana may consider dividends to be extraordinary that are characterized by elements establishing their additional nature with respect to the company’s normal dividend policy and shall inform the market.

In the event of the distribution of extraordinary dividends, strike prices (daily closing prices) and the number of shares underlying the contract shall be adjusted by applying the coefficient K, calculated as follows:

Formula 7.

     last price – extraordinary dividend amount
K = ---------------------------------------------------------
last price

where the amount of the extraordinary dividend is taken to be the entire amount of the dividend or a part thereof.

To limit the distortionary effects derived from the distribution of extraordinary dividends, Borsa Italiana calculates the adjustment coefficient according to formula 7. This value, always rounded to 6 decimal digits, is applied to strike prices (daily closing prices) and to the lot.

Borsa Italiana shall define the manner in which the contract in question is to be adjusted and promptly inform the market.

Adjustment of the exercise price (daily closing price):

E_ex = E_cum x K

where:

• E_cum = exercise price (daily closing price) before the adjustment
• E_ex = exercise price (daily closing price) after the adjustment

Adjustment of the number of underlying shares (lot):

                 1
A_ex = lot x -----
                  K

where:

• A_ex = number of underlying shares after the adjustment

_____________

Companies whose shares are in the FTSE MIB index or are the underlying of options or stock futures contracts traded on the IDEM market shall announce, before the end of the month subsequent to the closing date of their financial year:

• the month planned for the payment of the dividend, if any, based on the results for the financial year just closed, where this is different from the month in which the previous dividend was paid;

• the intention, if any, to adopt a policy of distributing interim dividends in the current financial year with an indication of the months in which the interim dividends and the final dividend are to be paid.