CREDITO VALTELLINESE CONVERTIBLE SUBORDINATE BOND ISSUE IN EURO
Following the extraordinary meeting called on April 18 1998, Credito Valtellinese's Board of Directors fixed the terms concerning the capital increase suggestion. The capital increase will be in Euro and is structured as follows:
free part: unit nominal value increase from 5,000 lire to three Euro for the 42,985,382 outstanding shares. Consequent capital stock increase from 214,927 million lire to 128,956 million Euro, through the application of the revenue reserves;
trading part: convertible subordinate bond issue cum warrant, involving issue of one bond, worth 1,000 Euro, every 300 outstanding shares for a maximum amount totalling 143,285 million Euro.
Possible redemption premium: 70 per cent sharing of the progressive monthly average appreciation of an index basket consisting of Standard & Poor's 500 index (referred to 500 shares listed on the New York Stock Exchange) for a half and of Nikkei 225 Stock Average index (referred to 225 shares listed on the Tokyo Stock Exchange) for the other half. The redemption premium will be paid on February 15 2002, 2003 and 2004 on half the instalment that falls due (150 Euro, 200 Euro and 200 Euro respectively). Bondholders can also opt for the conversion into shares of the other half.If, at any time, the progressive index calculated on the base of the monthly average of the above-mentioned indices exceeded by 40 per cent the initial value, the redemption premiums that are not fallen due would be valued 25 per cent of the corresponding expiring instalment.When calculating the progressive monthly average of the index basket, only positive variations in comparison with the initial index will be taken into account. In case of negative variations, the average will be calculated on the base of the initial value only.Further details and ranges of examples concerning the redemption premium calculation will be found in the informative documents late regulations provide.
Each bond will be combined with eighty warrants, forty of which can be exercised (a warrant each new share at six Euro) from February 15 2000 to May 15 2000, and the other forty from February 15 2001 to May 15 2001.
The bond issue will last five years and will be repaid by three instalments, which falls due respectively three, four and five years after the issue.
At each maturity (300 Euro for the first and the second instalment; 400 Euro for the third instalment), the bondholders can convert half the bonds that fall due into 24, 23 and 29 new shares (for the first, second and third instalment respectively) and be repaid the other half, increased by the possible premium linked to the above-mentioned indices trend. Otherwise, they can ask for repayment of all of the bonds.
A capital increase up to 67,057 million Euro at most, through issue of 22,352,460 shares will be suggested to support the bond issue cum warrants. Taking into account the issue paid-in surplus amounting to 73,362 million Euro at most, the transaction will allow a maximum net capital increase of 140,419 million Euro.
Stock option can be exercised from Monday January 18 1999 to Monday February 15 1999. As agreed with Borsa Italiana S.p.A., stock options will be negotiated on the Stock Exchange starting from January 18 1999. As regards stock options that have not been exercised within February 15, they will be offered in compliance with regulations written in the third paragraph of art. 2441 of the Italian Civil Code.
Bonds will be issued on February 15 1999 and their repayment presents:
