Tiscali 2008 Annual Report Download - page 137

of repaying the bridging loan granted by Intesa San Paolo
and JPMorgan in July 2007 to the UK subsidiary Tiscali
Uk Holding Ltd. As a result of said issue, the share
premium reserve rose by EUR 74.89 million.
•the issue of 42,339,442 ordinary shares with a par value of
EUR 0.50 each for the share capital increase carried out in
September 2008 with the aim of converting the bond issued
by the Luxembourg-based subsidiary Tiscali Financial
Services S.A. subscribed by Management & Capitali (M&C)
on 27 December 2007. As a result of said issue, the share
premium reserve rose by EUR 41.79 million
The share premium reserve also underwent a decrease of EUR
23.8 million, deriving from use of the same to cover the loss
accrued in the previous year resolved by the shareholders’
meeting held on 29 April 2008, along with a net decrease of
EUR 4.4 million consequent to the expenditure linked to the
share capital increases carried out during the year.
The Reserve for the purchase of treasury shares, amounting to
EUR 6.2 million, was established on 18 April 2008 following the
purchase of 2,600,000 treasury shares at an average unit price
of EUR 2.379 to serve the Stock Option plan assigned to the
former Chief Executive Officer Tommaso Pompei. The purchase
transactions were carried out in compliance with the provisions
as per Articles 2357 et seq. of the Italian Civil Code and the limits
indicated by the authorization of the shareholders’ meeting.
The Reserve for Stock Options, totalling EUR 3.8 million,
underwent an increase of EUR 2.9 million when compared
with the previous year, represented by the matching balance
of the remunerative component accrued in 2008 further to the
stock option plans allocated to the managers of the company,
and includes the effects of the acceleration of the plan
reserved for the former Chief Executive Officer and the former
Finance Director who maintained their assigned rights after
leaving the Group.
Shareholders are also informed that the remunerative
component deriving from the Stock Option plans relating to
managers who are employees of other Group companies is not
booked to the income statement of the parent company Tiscali
S.p.A. but is booked to increase the book value of the equity
investments in the Group companies on which the management
benefiting from the Stock Option plans depend (representing a
capital grant in their favour).
The amount allocated to the equity investment in the subsidiary
Tiscali Italia S.p.A. comes to EUR 0.5 million (of which EUR
0.15 million booked to decrease the retained profits because it
supplements the value recorded last year) while the amount
allocated to the equity investment in Tiscali International
Network S.p.A. came to EUR 0.08 million (of which EUR 0.02
million booked to decrease the retained profits because it
supplements the value recorded last year).
On 10 May 2007, the Board of Directors allocated the Chief
Executive Officer 3,593,143 options for the purchase of
ordinary shares in the Company, which will be possible to
exercise, subject to the achievement of the performance
targets, also in several tranches as from 4 May 2010 and by 3
November 2010, at a price of EUR 2.763 (equal to the average
price of the Tiscali shares in the 30 days prior to the allocation).
On 28 June 2007, the Board of Directors assigned 23 managers
a total of 3,330,000 options. It will be possible to exercise the
options between 29 June 2010 and 28 December 2010, at an
exercise price of EUR 2.378, also in several tranches.
The Board of Directors, during its meeting on 28 February
2008, resolved to adjust the exercise price of the options
allocated to the employees by means of the application of a
ratio of 0.896756, identical to that published by Borsa Italiana
on 11 January 2008, which was used to adjust the option and
futures contracts on Tiscali shares as a consequence of the
share capital increase for around EUR 150 million concluded
on 22 February 2008. The exercise price for the options
allocated to the employees therefore currently stands at EUR
2.132 per share.
Furthermore, on the basis of the agreements between the
Company and Tommaso Pompei as a consequence of the latter
relinquishing his powers, the options assigned to Tommaso
Pompei are understood to be exercisable for the full amount
resolved (including the second tranche) according to the terms
established in the regulations. As a result of the above-
mentioned adjustment mechanism, the exercise price for the
options allocated to Tommaso Pompei currently stands at EUR
2.477 per share.
TISCALI S.P.A. – FINANCIAL STATEMENTS AND EXPLANATORY NOTES
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