Share Dilution

Telecom Italia S p A: Convening of the Ordinary and Extraordinary General Meeting

The Board of Directors has called the General Meeting of Shareholders for April 7, 2022 (single call). This year, the General Meeting will again be held in accordance with the rules intended to limit the risk of infection and shareholders will only be able to attend through the proxy appointed by the Company. Votes can be cast independently, before the General Meeting, by post or electronically.

Full details regarding the exercise of shareholder rights will be specified in the notice of appeal which will be published in accordance with the law.

The General Meeting will be called upon to decide on the following subjects:

Financial statements – covering loss for the year

With the approval of the accounts as of December 31, 2021, it will be proposed to the General Meeting to cover the loss for the financial year by retained earnings and deduction from reserves.

Report on the policy on compensation and fees paid

The General Meeting will be called upon to approve the two sections of the Remuneration Report: with a binding vote for the first section devoted to the remuneration policy for 2022, and with a non-binding vote for the second section, which illustrates the fees paid in 2021.

The document will be made available to the public under the conditions provided for by law, at the same time as the annual financial report and the report on corporate governance and shareholders, also approved today by the Board of Directors.

Decisions resulting from the termination of a director’s duties

The cooptation of Pietro Labriola as director expires with the next General Meeting, at which it will be proposed to confirm his appointment for the remainder of the director’s term (until the approval of the accounts as of December 31, 2023).

2022-2024 Stock Option Plan

It will be proposed to the General Meeting to approve a three-year stock option plan, for part of the Group’s management, which will be identified by the Board of Directors in due course, including the CEO. The details of the initiative will be specified in the information document which will be published under the terms of the law.

The Plan, which aims to promote the alignment of the management team with the interests of the shareholders, will include a maximum of 257,763,000 free and non-transferable options, which will give the beneficiaries the right to purchase an equal number of ordinary shares of Telecom Italia, at an exercise price of €0.424, corresponding to the weighted average price of ordinary and savings shares over the period December 2021-February 2022. The options will become fully or partially exercisable as soon as performance indicators are achieved. specific performances, identified as (i) the cumulative EBITDA-CAPEX indicator for the period 2022-2024, (ii) the percentage of women in positions of responsibility at the end of 2024 and (iii) the ratio between renewable electricity and the electricity consumed in 2024, according to the objectives set out in the 2022-2024 industrial plan.

The Board of Directors will set the number of beneficiaries and the number of options granted to each, the exercisability of which (for a period of two years) will be assessed when the 2024 accounts are closed (with application of a ceiling in terms of maximum achievable profit). There is no loan or other concession from the Company for the purchase of the shares, which will not be subject to a blocking constraint. Any breach of contract with TIM, its subsidiaries or successor companies during the vesting period will result in the forfeiture of the options, unless the subject of the breach is qualified as a good start.

The plan will be served by the issuance of a maximum of 257,763,000 ordinary shares without par value by June 30, 2025 (with a maximum dilution of 1.19% of the total capital and 1.65% of the only shares ordinary, as of December 31, 2021).

Use of reserves to cover losses – definitive reduction of the corresponding balance sheet items

Following the resolution to cover the loss for the financial year by the use of retained earnings and reserves, all benefiting from a tax suspensive restriction, the reduction of the corresponding equity items will be definitively subject to the Extraordinary General Meeting, without the need for subsequent reconstitution.

Rome, March 2, 2022