REGULATIONS GOVERNING OPERATIONS WITH ASSOCIATED PARTIES (PURSUANT TO S. 2391-BIS OF THE CIVIL CODE AND ART. 9.C.1 OF THE CORPORATE GOVERNANCE CODE FOR LISTED COMPANIES) Document approved by the Board of Directors of Il Sole 24 Ore S.p.A. at its meeting held on 20 August 2007 Article 1 Scope 1.1 These Regulations, adopted by way of implementation of s. 2391-bis of the Civil Code and the recommendations contained in art. 9.C.1 of the Corporate Governance Code for listed companies, identify rules governing the approval and conduct of operations with Associated Parties performed by Il Sole 24 Ore S.p.A. (hereinafter called the Company ), either directly or through controlled companies, to ensure the transparency and the substantial and procedural correctness of the said operations. Article 2 Identification of Associated Parties 2.1 For the purposes of this document, Associated Parties shall mean, on the basis of the corresponding concept contained in International Accounting Standard IAS 24 (cited in art. 2.1.h of the Regulation approved by Consob Resolution no. 11971/1999): a) parties who directly and/or indirectly, through controlling companies or controlled companies, trust companies or intermediaries (which shall also be classed as Associated Parties): i) control the Company; ii) are controlled by the Company; iii) have the same parent company as the Company; 1
iv) own a holding in the Company which enables them to exert considerable influence 1 thereover; v) jointly control the Company; b) companies associated 2 with the Company; c) joint ventures in which the Company participates; d) Directors and Standing Statutory Auditors, and Senior Executives with strategic responsibilities 3 of the Company and the companies directly and/or indirectly controlled by it; e) close relations 4 of the parties specified in paragraphs (a) and (d) above; f) parties subject to control, including in joint form, or to considerable influence by one of the parties indicated in paragraphs (d) and (e) hereof, or in which the latter parties directly or indirectly hold a significant proportion of the voting rights; g) pension funds for the employees and senior executives of the Company or of any party associated with it 5. For the purposes indicated in paragraph 2.1 hereof, the relevant concept of control is identified by s. 93 of Legislative Decree no. 58 of 24 February 1998 (known as the Consolidated Finance Act or TUF) 6. 1 Pursuant to section 2359.3 of the Civil Code, considerable influence is presumed to exist if at least onetenth of the votes can be cast at the Ordinary Shareholders Meeting and the Company has shares listed on regulated markets. 2 Pursuant to section 2359.3 of the Civil Code, companies over which another company exerts considerable influence shall be deemed to be associated. 3 Senior Executives with strategic responsibilities shall mean parties who have the power and responsibility, directly or indirectly, for the management and control of the assets of the Company or the companies directly and/or indirectly controlled by it, namely (i) persons who report directly to the Company s Chief Executive Officer, and (ii) the additional senior executives registered in a specific list, who are expressly identified as such by the Company s Chief Executive Officer. 4 Family members who are likely to influence or be influenced by the party concerned in their dealings with the Company or with companies directly and/or indirectly controlled by it shall be deemed to be the Close Relations of a party. They shall include: i) the spouse, unless legally separated, the cohabitee and the children, including those of the spouse or the cohabitee; ii) additional persons who are dependants of the party concerned and are linked to that party by kinship. 5 Individual operations to a value exceeding 100,000 performed with that category of parties shall be deemed relevant for the purpose of these Regulations. 6 Pursuant to section 93 of the TUF, the following are deemed to be controlled businesses, either directly or through controlled companies, trust companies or intermediaries: - companies in which another company holds the majority of the votes which can be cast at the Ordinary Shareholders Meeting (known as de jure control); - companies in which another company holds sufficient votes to exercise a dominant influence at the Ordinary Shareholders Meeting (known as de facto control); - Italian or foreign companies over which a party has the right to exercise a dominant influence pursuant to an agreement or a term of the Articles of Association, provided that the applicable law allows the said agreements or terms; Italian or foreign companies in which a single shareholder, pursuant to agreements with other shareholders, holds enough votes to exercise a dominant influence at the Ordinary Shareholders Meeting. 2
2.2 The Internal Control Committee shall rule on cases in which the identification of an Associated Party is controversial on the basis of the definition contained in article 2.1. The identification of Associated Parties additional to those indicated in article 2.1, to be effected in any event on the basis of criteria established by International Accounting Standard IAS 24 7, shall be the responsibility of the Internal Control Committee. Article 3 Identification of operations with Associated Parties 3.1 For the purpose of this document, transfers of resources, services or obligations between the Company (or companies directly and/or indirectly controlled by it) and one or more of the Associated Parties identified pursuant to art. 2, shall constitute operations with Associated Parties, regardless of whether a fee has been agreed. By way of example and not of limitation, operations with Associated Parties shall include: - deeds of disposal of real and personal estate, including deeds of gift; - performance of work and services; - granting or obtaining loans and guarantees; - any other act relating to rights with an asset content. Article 4 Operations with Associated Parties which are subject to prior examination by the Internal Control Committee 4.1 The Company s Internal Control Committee shall perform a prior examination of operations with Associated Parties which are subject to the terms of these Regulations. The said prior examination is not required for operations which fall into one or more of the following categories: - operations performed between companies whose capital is wholly owned by the Company, directly and/or indirectly; - operations for which the consideration is established on the basis of the official market rates (e.g. agreements relating to foreign currency, interest 7 On the basis of paragraph 10 of International Accounting Standard IAS 24, when examining each relationship with Associated Parties, attention must be paid to the substance of the relationship and not merely to its legal form. 3
rates and commodities), if any agreed differences fall within normal business practice; - typical or usual operations, namely those which, due to their subject or nature, are consistent with the core business of the Company and the companies directly and/or indirectly controlled by it, and do not present any particularly critical factors connected with their characteristics, the risks inherent in the nature of the other party, or the time of their performance; - operations on standard terms, namely those concluded on terms similar to those usually agreed in dealings with parties which are not Associated Parties. 4.2 Prior examination by the Internal Control Committee is not required in the case of operations which, due to their type and/or size (regardless of whether they are performed with Associated Parties), must be submitted for the prior approval or evaluation of the Company s Board of Directors. 4.3 With regard to operations with Associated Parties which are submitted for its examination, and which are not subsequently presented to the Company s Board of Directors for approval or evaluation pursuant to article 5 hereof, the Internal Control Committee shall deliver to the Board of Directors a suitable report on the characteristic features of the said operations (in strategic, economic/financial, legal and tax terms, etc.), the nature of the association, the operating procedures and the economic terms agreed for the implementation thereof, the evaluation process used, the underlying reasons, and the economic and financial effects connected with the said operations. 4.4 The report indicated in article 4.3 shall be supplied in the ambit of the periodic report submitted by the Internal Control Committee to the Board of Directors. Article 5 Operations with Associated Parties subject to approval or evaluation by the Board of Directors 5.1 After examination by the Internal Control Committee, and with the consultative support and proposals of the Committee, the Company s Board of Directors shall give its prior approval (in the case of operations which are the Company s responsibility) or prior evaluation (in the case of operations which are the responsibility of companies directly and/or indirectly controlled by the Company) of operations with Associated Parties which fall into one or more of the following categories: a) atypical or unusual operations, namely those which, in terms of their significance/relevance, the nature of the parties thereto, the subject of the transaction, the procedure for establishing the transfer price and the timing of the transaction (near the year end) may give rise to doubts about the correctness/completeness of the information in the accounts, conflicts of 4
interest, safeguarding of company assets, and protection of minority shareholders 8 ; b) operations with a value exceeding 10 million euros, excluding those for which prior examination by the Internal Control Committee pursuant to article 4.1 hereof is not required; c) further operations submitted by the Internal Control Committee for examination by the Board of Directors, with special reference to operations performed with the Associated Parties referred to in article 2.1 paragraphs d), e) and f). 5.2 In relation to each of the operations with Associated Parties indicated in article 5.1 and submitted for its prior approval or evaluation, the Company s Board of Directors shall receive a suitable report on the characteristic features of the operation (in strategic, economic/financial, legal and tax terms, etc.), and on the nature of the association, the operating procedures, the timing and financial terms involved in its implementation, the evaluation process used, the underlying reasons, and any risks connected with the operation. If the association is with a Director of the Company or a party associated through a Director, the Director concerned shall promptly inform the Board of Directors of the nature, terms, origin and extent of his/her interest, and leave the meeting when the resolution is voted on unless maintenance of the quorum would be prejudiced, or the Board of Directors orders otherwise. If the association is with the Chief Executive Officer of the Company or with a party associated through the Chief Executive Officer, s/he shall refrain from performing the operation, and arrange for it to be dealt with by the Board of Directors. In such case, the terms of the preceding sentence shall apply. If the association exists with one of the Company s Standing Statutory Auditors or with a party associated through him/her, the Statutory Auditor in question shall promptly inform the other Statutory Auditors and the Chairman of the Board of Directors of the nature, terms, origin and scope of his/her own interest. 5.3 Resolutions of the Company s Board of Directors relating to operations with Associated Parties shall specify the reasons and the advantages of the operations for the Company and the Il Sole 24 Ore group. 5.4 The Company s Board of Directors shall receive a suitable report on the performance of operations with Associated Parties which it has approved or evaluated. 8 According to the definition supplied by Consob in Notice no. 6064293 of 28 July 2006. This category includes operations which, in view of their subject, consideration, procedure or implementation times may affect the safeguarding of the company s assets or the completeness and correctness of information, including accounting information, relating to the Company, for which there is an obligation to issue a specific report to the public in accordance with the procedures and periods identified by art. 71-bis of the Regulations approved by Consob Resolution no. 11971/1999. 5
The said report shall be supplied in the ambit of the periodic report prepared by the Chief Executive Officer on the activities performed, the general business trend and the most significant operations performed by the companies in the Il Sole 24 Ore Group. Article 6 Experts reports 6.1 In order to prevent an operation with Associated Parties from being concluded on terms other than those which would probably have been negotiated at arm s length, the Internal Control Committee (at the time of the prior examination of operations with Associated Parties pursuant to article 4 hereof) and the Board of Directors (for the purpose of approval or evaluation of the operations pursuant to article 5 hereof) shall have power to request, depending on the nature, value or other characteristics of the operation, the assistance of one or more experts to obtain from them an opinion on the economic terms, operating procedures, technical aspects and/or legitimacy of the operation. The experts shall be selected from among persons of acknowledged professionalism and competence, and the Company s Internal Control Committee and/or Board of Directors shall check their independence and absence of conflicts of interest in relation to the operation. Article 7 Notices and certificates 7.1 The Company s Directors and Standing Statutory Auditors shall give prompt notice to the Internal Control Committee as soon as they become aware of negotiations relating to operations with the Company or with companies directly and/or indirectly controlled by it involving Directors or Statutory Auditors and their close relations 9, parties subject to control, also in joint form, or to the considerable influence of the Directors or Statutory Auditors in question and/or of their close relations, or parties in which the said Directors or Statutory auditors and/or their close relations directly or indirectly hold a significant percentage of the voting rights. The report supplied to the Internal Control Committee shall state the nature, terms, origin and scope of the interests of the Directors or Statutory Auditors in question in the performance of the said operations. 7.2 Senior executives with strategic responsibilities of the Company and the companies directly and/or indirectly controlled by it 10 shall give prompt notice to the Internal Control Committee as soon as they become aware of negotiations relating to operations with the Company or with companies directly and/or indirectly controlled by it involving Directors and/or their close relations 11, parties subject to control, also in joint form, or to the considerable influence of the said Directors or Statutory Auditors in question and/or of their close relations or parties in which the said Directors and/or their close relations directly or indirectly hold a 9 As defined in paragraph e) and the corresponding footnote 4) of art. 2.1. 10 As defined in paragraph d) and the corresponding footnote 3) to art. 2.1. 11 As defined in paragraph e) and the corresponding footnote 5) to art. 2.1. 6
significant percentage of the voting rights. The report supplied to the Internal Control Committee shall state the nature, terms, origin and scope of the interest of the Directors or Statutory Auditors in question in the performance of the said operations. 7.3 Senior executives with strategic responsibilities of the Company and the companies directly and/or indirectly controlled by it shall, if applicable, issue an annual certificate to the Internal Control Committee stating that no such operations as indicated in art. 7.2 have been carried out. 7