185000000 IT Holding Finance SA

IT HOLDING S.p.A. Notes to the consolidated financial statements for the year ended December 31, 2002
Investments took on when it signed the sales contract for FINANCIÈRE MELPAR HOLDING S.A. shares, with
regard to prior year expenses not recorded in the FERRÉ Group consolidated financial statements at
December 31, 2001 which could arise and, accordingly, as a result of judicial, arbitration and/or administrative
proceedings pending on the date in which the consolidated financial statements were approved. Therefore, the two
companies’ Boards of Directors do not consider it necessary to set up a provision in relation to the dispute.
• IT HOLDING S.p.A. was informed of a pending dispute between the controlling shareholder, PA Investments,
and the main minority shareholder, Mr. Luigi Giribaldi. The latter claims to have agreed to sell his entire
shareholding to the former, a fact which PA Investments denies as such an agreement was never made. The
dispute does not involve IT HOLDING S.p.A. and should not represent any direct or immediate financial risk for
the issuer or for the IT HOLDING Group. In the unlikely case that PA Investments loses the dispute, this could
jeopardize its ability to indemnify IT HOLDING S.p.A. in terms of the hold harmless agreement and to fulfill the
guarantees described above.
• ALLISON S.p.A. is currently involved in arbitration proceedings with a supplier with which it had signed a
contract scheduled to expire in February 2006. The supplier disputed termination of the contract, claiming willful
misconduct on the part of ALLISON S.p.A., from which it requested damages of approximately Euro 7 million.
In agreement with the opinion of lawyers engaged by ALLISON S.p.A., the suppliers’ requests for damages are
not presently considered a probable contingency, based on their lack of grounds and the inappropriate
quantification of the damages.
• On August 9, 2004 certain companies, including IT Holding S.p.A. and Servizi Moda S.r.l., were served an
appeal for urgent relief put forth by a designer who had previously collaborated with Group companies (sold to
third parties in 2004). The designer maintains he is owed no less than Euro 41 million for future amounts
receivable, compensation for damage for alleged breach of contract, and fees accrued and not received.
Accordingly, the designer has requested the Court order provisional remedies to protect his current and future
claim with respect to all companies involved, including IT Holding S.p.A. and Servizi Moda S.r.l. IT Holding and
Servizi Moda S.r.l. appeared in a timely manner and made their defense, highlighting the utter inadmissibility and
lack of grounds of any claims against them. IT Holding, supported by the opinion of its lawyers, considers the
claims completely unfounded and, accordingly, is not in a position to identify the risk of even remotely contingent
liabilities.
The Judge rendered his decision on September 8, 2004, rejecting all the requests made by the petitioners. Finally, we
have been informed that Mr. Gigli and Romeo Gigli s.a.s. appealed the decision rendered on September 8, 2004. We
therefore expect that a copy of the appeal could be served in a few days. We are not currently in a position to know on
which grounds the appeal is based and when the relevant hearing to discuss the appeal will take place.
• At the end of April 2004, IT HOLDING S.p.A. sold the entire shareholding in GIGLI S.p.A. At that date,
judgment was pending on legal action against GIGLI S.p.A. taken by a licensee, alleging that the licensing and
agency agreements between the two were void or should be voided, and requesting reimbursement for all
royalties, advertising contributions, and commissions paid, quantified as Euro 5,156,654.86, in addition to
compensation for damage of Euro 2,000,000. GIGLI S.p.A. had appeared in Court and disputed such Court’s
jurisdiction, as well as the inadmissibility and lack of grounds of the claims, making a counterclaim for damages.
The agreements with the buyer of the investment in GIGLI S.p.A. provide that IT HOLDING S.p.A. hold such
buyer harmless in the event that losses or liabilities arise in relation to the litigation. GIGLI S.p.A. is not expected
to lose the case. Accordingly, it is unlikely that IT HOLDING S.p.A. will have to hold the buyer harmless.
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