MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

LIMITED LIABILITY COMPANIES“SRL”

STOCK CORPORATIONS“SPA”

Formalities and procedures for incorporation: the company must be incorporated before an Italian Notary Public. The parties can appear personally or be represented by attorneys-in-fact.

When the incorporating members are foreign companies, it is advisable that the individual appearing in front of the Italian Notary Public be entitled in force of a special power of attorney, even if such individual is actually the legal representative of the quota-holder(s).

Srl may be incorporated only by means of a simultaneous constitution procedure.

Formalities and procedures for incorporation: the company must be incorporated before an Italian Notary Public. The parties can appear personally or be represented by attorneys-in-fact.

When the incorporating members are foreign companies, it is advisable that the individual appearing in front of the Italian Notary Public be entitled in force of a special power of attorney, even if such individual is actually the legal representative of the shareholder(s).

Spa may be incorporated by means of a simultaneous constitution procedure or by means of a public subscription.

Sole quota-holder: an Italian Srl can be incorporated also with a sole quota-holder (art. 2463, § 1, of the Italian Civil Code, hereinafter ICC).

Sole shareholder: an Italian Spa can be incorporated also with a sole shareholder (art. 2325 and 2328, § 1, ICC).

Liability of the sole quota-holder: should the company be insolvent, with reference to the obligation arisen in the period in which the quotas belonged to a sole quota-holder, the latter shall be liable without limitation (i) until the communication to the Register of Enterprises of the existence of a sole quota-holder have been duly performed and/or (ii) in the event contributions have not been fully paid in (art. 2462, § 2, ICC).

Liability of the sole shareholder: should the company became insolvent, with reference to the obligation arisen in the period in which the shares belonged to a sole shareholder, the latter shall be liable without limitation in the event that (i) contributions have not been fully paid in and/or (ii) until the communication to the Register of Enterprises of the existence of a sole shareholder have been duly performed (art. 2325, § 2, ICC).

Minimum capital: Euro 10.000,00 (ten thousand/00), (art. 2463, § 1, no. 4, ICC).

Minimum capital: Euro 120.000,00 (one hundred and twenty thousand/00), (art.

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MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

2327, ICC).

Initial contribution to be paid in at the incorporation: 25% of the contributions in cash, to be deposited with a bank. In the event of a sole quota-holder, 100% of the contributions in cash.The initial contribution shall be replaced with the deposit of an insurance policy or bond (art. 2464, § 4, ICC).

Initial contribution to be paid in at the incorporation: 25% of the contributions in cash, to be deposited with a bank. In the event of a sole shareholder, 100% of the contributions in cash (art. 2342, ICC).

Contributions: under the Reform, a quota-holder can make contributions of works and services to be granted for an amount equal to their entire value, by insurance policy or bond.

Contributions: contributions by performing work or services are prohibited (art. 2342, § 5, ICC).

Quotas: under the Reform it is not longer valid the principle of the strict proportionality between contributions and quotas.

Shares: under the Reform, an Italian Spa can issue shares with no face value. In this event, the by-laws must specify only the subscribed corporate capital and the number of issued shares, assuming that such shares are equal fractions of the share capital as well. Therefore, they do not represent any absolute value, but only a percentage, on the basis of which shareholders’ rights can be quantified.

The company may issue several classes of shares such as, for example, (i) shares which are differently affected by losses, (ii) shares granting different voting rights, (iii) shares granting dividends depending on the company’s business results within a specific sector, (iv) shares without voting rights, etc.

Administrative body: according to the Reform, an Italian Srl can be managed by (i) a Board of Directors, or (ii) a Sole Director or (iii) more Directors that will act jointly or severally.

Should a Board of Directors be appointed, the company by-laws may

Management and control systems: the Reform provides for three different management and control systems: (i) the traditional system; (ii) the monistic system and (iii) the dual system.

(i) the traditional systemprovides for the following corporate

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MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

provide that decisions can be held by way of written consultation or consent expressed in writing, without the need to hold a formal meeting (art. 2475, § 4, ICC).

bodies: - Shareholders’ meeting, - Board of Directors for the management of the company and - Board of Statutory Auditors for the control over the management.

In case the company does not avail itself of the venture capital market (for example, companies which are not listed at stock exchange markets) and it is not obliged to draw the consolidated financial statement, it shall vest the Board of Statutory Auditors with the accounting audit, if this is provided for in the by-laws (art. 2409-bis, § 3, ICC).Otherwise, the accounting control activity is granted to an external auditor.

(ii) the monistic systemprovides for the following corporate bodies:- Shareholders’ meeting,- Board of Directors,- Management Control Committee appointed by the Board of Directors among its members which is entrusted with monitoring activities relating to the organizational structure of the company and the internal control, administrative and accounting system. It performs the Board of Statutory Auditors’ tasks.

The accounting control activity is granted to an external auditor.

(iii) the dual systemprovides for the following corporate bodies:- Shareholders’ meeting,- Management Board which directors are appointed by the Supervisory Board (equivalent to the Board of Directors),- Supervisory Board appointed by the ordinary Shareholders’ meeting.

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MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

The accounting control activity is granted to an external auditor.

Duration of the Directors’ charge: directors shall be appointed for an unlimited period of time.

Duration of the Directors’ charge: not exceeding three accounting periods. The expiration date corresponds to the date scheduled for the meeting that shall resolve upon the approval of the financial statement regarding the last accounting period of the directors’ charge (art. 2383, § 2, ICC).

Functions of the Directors: Directors generally represent and manage the company. In any case, the administrative body is competent for the drafting of the financial statement, for the drafting of project of merger and demerger, for decisions relating to the increase of the corporate capital (art. 2475, § 5, ICC).

The quota-holders can be vested with significant tasks in the management of the company by the by-laws or by the directors that may submit to the quota-holders’ approval the decisions on specific issues.

Functions of the Directors: Directors generally represent and manage the company.The by-laws can not provide for the transfer of any management powers from the Board of Directors to the Shareholders’ Meeting which is only entitled to give specific authorizations to the Directors without prejudice to their own liabilities.

Corporate liability action against Directors: it can be started also by each quota-holder that may ask, if specific circumstances occur, for a judicial revocation of directors.

Corporate liability action against Directors: it can be started also by shareholders representing at least 1/5 of the corporate capital or the higher majority provided for by the by-laws (not exceeding 1/3), (art. 2393-bis, § 1, ICC).

For the companies availing themselves of the venture capital (for example, listed companies), a majority of 1/20 is required (the by-laws may provide for a lower majority), (art. 2393-bis, § 2, ICC).

Quota-holders’ decisions and resolutions: the company by-laws may provide that quota-holders can decide upon general matters by way of consent

Shareholders’ decisions and resolutions: the shareholders are allowed to decide upon general matters only through ordinary and extraordinary meetings.

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MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

expressed in writing or by way of written consultation. However, if the company by-laws does not provide for the possibility of written consultation or for consent to be expressed in writing, and, in any case, with reference to specific matters (i.e. for the amendment of the deed of incorporation, for the approval of material changes to the business purpose of the company or when a number of quota-holder representing at least 1/3 of the corporate capital or one or more directors request the adoption of a resolution), quota-holders must resolve by means of a meeting (art. 2479 ICC).

Decisions held by means of written consultation and/or consent expressed in writing, are not allowed.

Quota-holders’ meeting - calling: the deed of incorporation shall set out the modalities of calling of the quota-holders’ meeting so to ensure the timely communication of the agenda. Lacking specific provisions, the notice of call shall be given by way of registered mail, to be sent at least 8 days before the meeting (art. 2479-bis, ICC).

Shareholders’ meeting – calling: the notice of call have to be published in the Official Gazette or in a newspaper (to be specified in the company by-laws), at least 15 days before the date of the meeting. Where allowed by the by-laws, should the company do not avail itself of venture capital, the notice of call may be sent to shareholders by suitable means, allowing to provide evidence of receipt, at least 8 days before the meeting (art. 2366, ICC).

The shareholders’ meeting can also be convened, within the limits provided for by art. 2367, § 3, ICC, by shareholders holding one tenth of the share capital or even less, if provided so by the by-laws (art. 2367, ICC).

Quota-holders’ decisions - quorum: unless otherwise provided for by the company by-laws, quota-holders’ decisions shall be adopted with the favorable vote of at least one half of the corporate capital (art. 2479, § 6, ICC).

Shareholders’ meetings - quorum: Shareholders’ meeting can be ordinary or extraordinary, depending on issues to be discussed upon and it can be on first and/or second or further calls.

Quorum – first call (art. 2368, ICC)- Ordinary meeting: it is regularly constituted with the presence of at least one half of the corporate capital and

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MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

validly resolves with the favorable vote of the absolute majority, unless otherwise provided for by the by-laws.- Extraordinary meeting: validly resolves with the favorable vote of the at least more than one-half of the corporate capital, unless otherwise provided for by the by-laws.

Quorum – second call or further calls (art. 2369, ICC)- Ordinary meeting: it validly resolves on the item of the agenda whatever may be the number of shareholders in attendance.- Extraordinary meeting: generally it is regularly constituted with the presence of more than one-third of the corporate capital and resolves with the favorable vote of at least two-third of the capital there represented. The company by-laws may provide for different majorities.

Section 2369 of the Italian Civil Code also provides for specific majorities regarding specific items.

Quota-holders’ meetings in plenary form: notwithstanding the lack of notice of calling, resolutions are validly held when the entire corporate capital and all the appointed Directors and Auditors are in attendance or have been informed and no one opposes to the resolution at issue (art. 2479-bis, § 5, ICC).

Shareholders’ meetings in plenary form: notwithstanding the lack of notice of calling, resolutions are validly held when the entire capital and the majority of Directors and Statutory Auditors are present (art. 2366, § 4, ICC).

Board of Statutory Auditors: the appointment of a Board of Statutory Auditor is not always necessary.

Should the capital of the Italian Srl exceed the amount of Euro 120.000,00, it will be necessary to appoint a Board of Statutory Auditors.

The Board must also be appointed in the

Board of Statutory Auditors: it must be appointed only in the companies with a traditional management system.

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MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

event for two subsequent financial years two of the following limits have been exceeded:- total of the assets shown in the F/S: Euro 4,400,000.00;- turnover: Euro 8,800,000.00;- employees: 50 units.The obligation at issue ceases if two of the above limitations are not exceeded for two years (art. 2477, ICC).

Functions of the Board of Statutory Auditors: it performs controls over the management of the company.

Functions of the Board of Statutory Auditors: it performs controls over the management of the company.

Accounting audit: unless otherwise provided for by the company by-laws, the accounting audit is granted to the Board of Statutory Auditors (art. 2477, ICC).

The accounting audit of an Italian Srl can also be granted to an Auditor, without prejudice of the other functions granted to the Board of Statutory Auditors, if so is allowed by the company’s by-laws

Accounting audit: it generally shall be exercised by an Auditor or by an Audit company.

Should a company choose a traditional management system, does not avail itself of the venture capital market and it is not obliged to draw the consolidated financial statement, it can vest the Board of Statutory Auditors with the accounting audit (art. 2409-bis, § 3, ICC).

Minority rights: the quota-holders that do not participate to the management of the company are entitled to be informed by the directors about the carrying out of the business and to inspect the company’s books and documents relating to the management of the company, also by way of professionals of their trust (art. 2476, § 2, ICC).

Minority rights: minorities have no special rights to exercise like inspecting documents and starting the corporate liability action against Directors, except for the followings. The shareholders shall (i) call the meeting within the limits provided for by the above paragraph Shareholders’ meeting – calling, (ii) start the corporate liability action against directors within the limits provided for by the above paragraph Corporate liability action against Directors and (iii) report to tribunal. In particular, with regards to this latter issue, if there is a basis for suspicion of serious irregularities in the management by the directors in violation of their duties, which may damage the company or one or more of the controlled companies,

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MAJOR ANALOGIES AND DIFFERENCES BETWEEN ITALIAN SRL AND

ITALIAN SPA

as per the Corporate Law Reform enacted by Legislative Decree No. 6 of

January 17, 2003 and its following modifications (hereinafter, the “Reform”)

shareholders representing one-tenth of the company’s capital or, in companies which make recourse to the market of risk capital, one-twentieth of the company’s capital, can report the facts to the tribunal with a recourse to be served also on the company. The by-laws may provide for lawer percentages of participation (art. 2409, § 1, ICC).

Quota-holders’ agreements: no particular provisions are set by the law.

Shareholders’ agreements: the Reform introduced several provisions regarding terms and public disclosure of the shareholders’ agreements (art. 2341-bis and 2341-ter, ICC).

Assets designated for a specific business transaction: the Reform does not provide for any special rule about such item.

Assets designated for a specific business transaction: under the Reform and in order to extend financial opportunities for Italian Spa, a company may provide for the constitution of (i) assets destined for a specific deal and (ii) loans destined for a specific deal (art. 2447-bis and followings, ICC).

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