Free share capital increase

With a free share capital increase, each holder of shares included in the operation will receive new shares free of charge according to a ratio communicated by the issuer without having to exercise any right. The theoretical value of the right is therefore null by definition. This corporate action is a particular instance of the previous one. The formula 4 is worked out directly from the formula 3 illustrated above, because the underwriting price of the new shares is null.

Borsa Italiana calculates the adjustment coefficient according to the formula 4. This value, always rounded to 6 decimal digits, is applied to strike prices (daily closing prices) and to the lot.

Consequently, stock option contracts (stock future) subject to a free share capital increase will have both their strike prices (daily closing prices) and lot changed.

More specifically, the coefficient (k) is calculated as follows:

Formula 4.

     V
K = --------
      (V+N)

where:

• V = number of old shares
• N = number of new shares

Adjustment of 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

____________________

Example

Free attribution of ordinary shares for Banca Monte dei Paschi di Siena, official notice n. 5086 of 5/16/2001

Allocation of 1 new Banca Monte dei Paschi di Siena ordinary share for every 10 owned Banca Monte dei Paschi di Siena ordinary shares.

With reference to the Banca Monte dei Paschi di Siena shares, the adjustment intervention affects both the exercise price and the number of shares underlying the option contracts. The adjustment coefficient K will be applied according to the following method of intervention:

The K coefficient hereafter determined is rounded to the 6th decimal digit.

V
             K = -------- = 0.909091
(V+N)

where:

• V = number of old shares
• N = number of new shares

Adjustment of the exercise price and of the number of shares underlying the stock option contract (lot)

E_ex = E_cum × 0.909091

where:

• E_cum = exercise price before the adjustment
• E_ex = exercise price after the adjustment

A_ex = 1,000 x 1.10 = 1,100

where:

• A_ex = number of shares after the adjustment.

____________________