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Notice convening the shareholders' meeting

03/27/2010 - 06:00 AM

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TELECOM ITALIA S.p.A.

Registered office in Milan at Piazza degli Affari 2
Executive office and branch office in Rome at Corso d’Italia 41
Share capital: Euro 10,673,865,180.00, fully paid-up
Tax ID/VAT no. and Milan Companies Register no. 00488410010

Electronics Manufacturers Register no. IT08020000000799


NOTICE OF SHAREHOLDERS’ MEETING

The ordinary shareholders of Telecom Italia S.p.A. are hereby called to meet

  • at 12 PM on 27 April 2010 in Milan at Piazza degli Affari 2 (extraordinary meeting, first call); or
  • at the same time and in the same place on 28 April 2010 (ordinary meeting, first call and extraordinary meeting, second call); or
  • at 11 AM on 29 April 2010 in Rozzano (Milan) at Viale Toscana 3 (ordinary meeting, second call and extraordinary meeting, third call);

to discuss and vote on the following:

Agenda

Ordinary part

  • Financial statements for the year ended 31 December 2009 - related and consequent resolutions;
  • Appointment of a Director;
  • Appointment of independent auditors for 2010-2018 - related and consequent resolutions;
  • Employee shareholding plan - related and consequent resolutions;
  • Long-term incentive plan for executives - related and consequent resolutions.

Extraordinary part

  • Amendment of Article 5 of the Bylaws - related and consequent resolutions;
  • Authorization to increase share capital in service of the employee shareholding plan and the long-term incentive plan for executives - related and consequent resolutions.

In view of the Company’s ownership structure, the quorum will presumably be reached and the meeting duly constituted on 29 April 2010 at 11 AM in Rozzano (Milan) at Viale Toscana 3.


Items of business on the agenda

Ordinary part

Financial statements for the year ended 31 December 2009 - related and consequent resolutions;

The documentation regarding the financial statements for the year ended 31 December 2009 will be made available within applicable legal time limits.

Appointment of a Director

Following the resignation tendered by a Director (Stefano Cao), it is proposed that Mauro Sentinelli be appointed Director of the Company’s Board for the remainder of the term of office of the currently serving Board of Directors (and thus until the approval of the accounts at 31 December 2010).

Appointment of independent auditors for 2010-2018 - related and consequent resolutions

The issue of the report on the accounts at 31 December 2009 shall mark the expiry of the appointment as auditors of Reconta Ernst & Young S.p.A.

The Shareholders’ Meeting is asked to appoint new independent auditors for the nine-year period 2010-2018 on the basis of the reasoned proposal put forward by the Board of Auditors. Such internal control body has submitted to the Board of Directors a proposal to appoint PricewaterhouseCoopers S.p.A. for consideration of 1,811,300 Euro (excluding VAT and expenses) for each year of the nine-year period 2010-2018, for the auditing of the separate financial statement of Telecom Italia S.p.A. and the consolidated financial statement of the Telecom Italia Group; limited auditing of the half-yearly condensed consolidated financial statement of the Telecom Italia Group; the auditing of Form 20-F drawn up in accordance with the applicable US requirements; the attestation on the internal controls in accordance with Section 404 of the Sarbanes-Oxley Act.

Employee shareholding plan – related and consequent resolutions

The Shareholders’ Meeting is asked to resolve on the launch of the 2010-2014 public shareholding plan for employees.

The plan calls for a subscription offering reserved for employees of a maximum of 31,000,000 ordinary shares at a discount of 10% off the market price, up to a maximum limit of Euro 3,000 per employee, with an instalment option. Subscribers who retain their shares for one year, subject to remaining in the Company’s employ, shall receive one ordinary bonus share for every three shares subscribed for cash.

Long-term incentive plan for executives – related and consequent resolutions

It is proposed that the Shareholders’ Meeting approve the 2010-2015 long-term incentive plan reserved for a selected portion of Telecom Italia’s executives.

The plan calls for beneficiaries to be granted a cash bonus based on three-year performances (2010-2012) according to predetermined parameters, with the option to invest 50% of the bonus accrued in newly issued ordinary shares at market prices, up to a maximum amount of Euro 5 million. Subscribers who retain their shares for two years, subject to remaining in the Company’s employ, shall be granted one ordinary bonus share for each share subscribed for cash.


Extraordinary part

Amendment of Article 5 of the Bylaws – related and consequent resolutions

In connection with the 2010-2014 public shareholding plan for employees and the 2010-2015 long-term incentive plan and, more generally, in order to provide the Shareholders’ Meeting with an additional operational tool, it is proposed that Article 5 of the Bylaws be amended to allow the allocation of profits to the employees of the Company or its subsidiaries through bonus share grants pursuant to Article 2349 of the Italian Civil Code.

The proposed amendment shall not give rise to the right of withdrawal.

Authorization to increase share capital in service of the employee shareholding plan and the long-term incentive plan for executives – related and consequent resolutions

It is proposed that the Shareholders’ Meeting – by amending Article 5 of the Bylaws subject to a single vote – authorize the Board of Directors to increase share capital as follows:

  • in the service of the 2010-2014 public shareholding plan for employees, (i) for cash by issuing a maximum of 31,000,000 ordinary shares, pre-emption rights excluded, to be offered for subscription to plan beneficiaries and, subsequently, (ii) in the maximum amount of Euro 5,683,333.15 through the allocation of the corresponding maximum amount of profit pursuant to Article 2349 of the Italian Civil Code, by issuing the number of ordinary shares required to grant one bonus share per every three shares subscribed for cash;
  • in the service of the 2010-2015 long-term incentive plan, (i) for cash by issuing ordinary shares in the maximum amount of Euro 5,000,000, pre-emption rights excluded, to be offered for subscription to plan beneficiaries and, subsequently, (ii) in the maximum amount of Euro 5,000,000 through the allocation of the corresponding maximum amount of profit pursuant to Article 2349 of the Italian Civil Code, by issuing the number of ordinary shares required to grant one bonus share per each share subscribed for cash.

The foregoing amendments to the Bylaws shall not entitle shareholders who do not vote in favour thereof to withdraw.

Documentation

The explanatory reports and the proposals on all items of business on the agenda, except for documentation regarding financial statements for the year ended 31 December 2009, are available to the public at the Company’s Registered Office, from Borsa Italiana S.p.A., and on the Company’s website at the address http://www.telecomitalia.it. The documentation regarding financial statements for the year ended 31 December 2009 shall be made available by the legal term.

The Registered Office is open to the public for consultation and/or delivery of copies of the foregoing documentation on weekdays from 10 AM to 1 PM and 3 PM to 5 PM.

Shareholders’ Meeting documentation may also be requested through the contact channels stated at the foot of this notice. The Company shall not consider requests submitted on previous occasions.

Additions to the agenda of the Shareholders Meeting

Shareholders jointly or separately representing at least one-fortieth of share capital with voting rights may request that the matters to be discussed be supplemented by stating the proposed subject matter in their applications, which must be delivered to the Registered Office by 1 April 2010, for the attention of the Chairman of the Board of Directors, accompanied by appropriate certification attesting to the foregoing amount of shares. Pursuant to Article 18 of the Bylaws, which may be consulted at the address http://www.telecomitalia.it, the application must be accompanied by a specific explanatory report filed at the Registered Office in time to be made available to shareholders at least ten days prior to the date set for the meeting on the first call.

The agenda may not be supplemented to include subject matter that the law requires be put before the Shareholders’ Meeting by proposal of the Directors or according to a plan or report drafted by the Directors.

If the agenda is supplemented, the extended list of the subject matter to be discussed in the Shareholders’ Meeting shall be published according to the same conditions as this notice.


Total number of shares and
voting rights

Pursuant to Article 5 of the Bylaws, the subscribed and paid-up share capital is equal to Euro 10,673,865,180.00, divided into 13,380,906,939 ordinary shares (with voting rights in the Company’s ordinary and extraordinary shareholders’ meetings) and 6,026,120,661 savings shares (with voting rights in special category shareholders’ meetings), all of which have a par value of Euro 0.55 each.


Entitlement to participate

Pursuant to Article 19 of the Bylaws, an ordinary shareholder is entitled to participate in the Shareholders’ Meeting if the Company has received a specific notice for such shareholder in accordance with applicable legislation no later than two days prior to the date of each meeting.

The Company does not require that shares be frozen as a requirement to participate in the Shareholders’ Meeting. Shareholders are required to provide instructions to the broker who keeps the accounts in question so that said broker may give the foregoing notice to the Company no later than two days prior to the date set for the meeting. The foregoing shall not result in any restriction upon the subsequent withdrawal of shares. However, the withdrawal of shares shall void any notice already given for the purposes of entitlement to participate in the Shareholders’ Meeting.

The Company shall not be held liable for any notice requirements for the timely discharge of applicable obligations or the material unavailability of the shares for which notice is given in accordance with a broker’s operating practices.

Each shareholder entitled to participate may be represented at the Shareholders’ Meeting by written proxy, subject to the restrictions and limits established by law. The copy of the notice that brokers are required to give to shareholders contains a specific area for giving a proxy. A proxy form in Italian and English is available from the Company’s Registered Office and the address http://www.telecomitalia.it.

Entitled parties are asked to arrive in advance of the scheduled commencement of the meeting. Accreditation activities shall begin at 9 AM on 29 April 2010. Furthermore, in order to facilitate the determination of entitlement to participate, entitled parties are asked:

  • to transmit any proxy documentation in advance of the date of the meeting, using the contact channels indicated at the foot of this notice as necessary;
  • to present, on the day of the meeting, a copy of the notice given to the Company, with which the broker is required to provide them in accordance with applicable legislation.


Voting by mail

Pursuant to Article 19 of the Bylaws, ordinary shareholders may also exercise their voting rights by mail.

The documentation for casting votes by mail shall be available from 13 April 2010 from the Company’s Registered Office, where it may be requested, including through custodians. The envelope that contains the ballot card, a copy of the notice given by the broker, and any documentation attesting to entitlement to sign the ballot, must be delivered to the following address:

TELECOM ITALIA S.p.A.
Corporate Affairs
Piazza degli Affari n. 2
20123 MILAN - ITALY

no later than forty-eight hours before the meeting.

It should be noted that voting by mail is incompatible with proxies and thus must be undertaken directly by the voteholder.


ADR holders

Holders of ADRs representing ordinary shares in Telecom Italia listed on the New York Stock Exchange should contact JP Morgan Chase Bank, the issuer of said ADRs (customer service postal address: P.O. Box 64504 St. Paul, MN 55164-0504; telephone: +1 651 453 2128 for calls from outside the United States and 1 800 990 1135 for calls from within the United States; e-mail address: jpmorgan.adr@wellsfargo.com).


Rozzano shuttle bus service

A shuttle bus service shall be provided with departures at 8.30, 9:00 and 9:30 AM on 29 April 2010 from Telecom Italia’s registered office (Milan, Piazza Affari 2) to the place of the Shareholders’ Meeting, followed by return trips after the Meeting.

The shuttle bus service is available by reservation to be made no later than 23 April 2010 by calling freephone number 800899389 or writing to the e-mail address navette.assemblee@telecomitalia.it.

 

Further information

For any further information, please contact:


> Proxy Form (file .pdf, 25 KB)

> Proposed resolutions (file .pdf, 134 KB)

> 2009 Report on the Corporate Governance and Ownership Structure of Telecom Italia S.p.A. (file .pdf, 199 KB) - Please note that the English document is a mere translation from the original Italian version