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ADMISSION DOCUMENT

regarding the

ADMISSION TO TRADING ON AIM ITALIA/ALTERNATIVE INVESTMENT MARKET, MULTILATERAL TRADING SYSTEM ORGANIZED AND MANAGED BY BORSA ITALIANA S.P.A.

OF ITALIA INDEPENDENT GROUP S.P.A.’S SHARES

Nominated Adviser and Specialist

Equita SIM S.p.A.

Joint Global Coordinators

Equita SIM S.p.A. Banca IMI S.p.A.

Financial Adviser

Methorios Capital S.p.A.

This Admission Document has been prepared in compliance with the AIM Issuers’ Regulations with the purpose of admitting Italia Independent Group S.p.A.’s ordinary shares to tradings on AIM Italia/Alternative Investment Market (hereinafter “AIM Italia”) and is not an information sheet

pursuant to Legislative Decree no. 58 of 24 February 1998, as subsequently amended and supplemented (hereinafter “Consolidated Finance Act”)

and Consob Regulation no. 11971 of 14 May 1999, as subsequently amended and supplemented (hereinafter “Regulation 11971”).

Borsa Italiana S.p.A. issued the measure for admission to trading on AIM Italia on June 26th, 2013. The expected trading start date for the Issuer’s

shares is June 28th, 2013.

The shares of the Company are negotiated in no Italian or foreign regulated or unregulated market and the Company submitted no request for admission of its shares in other markets (except for AIM Italia).

AIM Italia is a multilateral trading system primarily dedicated to small and medium enterprises and to companies with a high growth potential that are

typically associated with a higher risk level compared to larger issuers or issuers with a consolidated business.

The investor should be aware of the risks deriving from investing in this type of issuers and should decide whether to invest only after a careful

evaluation.

In order to correctly appreciate the financial instruments considered in this Admission Document, all the information disclosed in this document, including Chapter 4 “Risk factors”, should be carefully examined.

Consob and Borsa Italiana S.p.A. neither examined nor approved the contents of this document.

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Neither this Admission Document nor the operation described in this document is a public offer of financial instruments

or an admission of financial instruments in a regulated market as defined in the Consolidated Finance Act and

Regulation 11971. Therefore, there is no need to prepare a prospectus according to the schemes set forth in EU

Regulation 809/2004/EC. The publication of this document is not subject to Consob authorization pursuant to the

European Prospectus Directive no. 2003/71/EC (“hereinafter the “Prospectus Directive”) or any other rule or

regulation regarding the preparation and publication of information prospectuses (including articles 94 and 113 of the

Consolidated Finance Act).

The New Shares resulting from the Capital Increase and the Sale Shares have been offered to qualified investors in Italy

and institutional investors abroad in proximity of the admission to trading on AIM Italia, pursuant to art. 6 of Part II

(“Guidelines”) of the AIM Issuers’ Regulations within the framework of a private placement falling under the cases of

inapplicability of the provisions concerning public offers of financial instruments as defined in Art. 100 of the

Consolidated Finance Act and Art. 34-ter of Regulation 11971, and therefore without an IPO of New Shares and Sale

Shares (hereinafter the “Institutional Placement”).

This Admission Document may not be disclosed, either directly or indirectly, in jurisdictions other than Italy and, in

particular, in Australia, Canada, Japan and the United States of America or in any other country where the offer of the

securities indicated in this Admission Document is not permitted in the absence of specific authorizations by the

competent authorities and/or notified to investors resident in said countries, except for the exemptions provided for by

the applicable legislation. The publication and distribution of this Admission Document in other jurisdictions may be

subject to legal or regulatory restrictions. Any entity that may receive this Admission Document shall preventively

verify the existence of said regulations and restrictions and comply with them.

The Shares have not been and will not be registered pursuant to the United States Securities Act of 1933 and subsequent

amendments or with any financial regulation authority of any state of the USA or based on the legislation concerning

financial instruments in force in Australia, Canada or Japan. The Shares may not be offered, sold or transferred in any

manner, either directly or indirectly, in Australia, Canada, Japan and United States and shall not be offered, sold or

transferred in any manner, either directly or indirectly, on behalf or to the benefit of citizens or individuals resident in

Australia, Canada, Japan or the United States, unless the Company is entitled to and uses, in its total discretion, any of

the exemptions provided for by the applicable legislation.

Violating these restrictions may be considered as a violation of the applicable legislation regarding financial instruments

in the competent jurisdiction.

The Company represents that it will use the Italian language for all the documents made available to shareholders and

for any other information disclosed as required by the AIM Issuers’ Regulations.

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CONTENTS

DEFINITIONS AND GLOSSARY .................................................................................................................... 7

DOCUMENTS ACCESSIBLE TO THE PUBLIC .......................................................................................... 10

ADDITIONAL INFORMATION ..................................................................................................................... 11

CALENDAR OF THE OPERATION .............................................................................................................. 11

MAIN INFORMATION ON THE ISSUER’S SHARE CAPITAL ................................................................. 11

PART ONE ....................................................................................................................................................... 12

1. INFORMATION ON THE PERSONS IN CHARGE OF THE ADMISSION DOCUMENT .............. 13

1.1 PERSONS IN CHARGE OF THE ADMISSION DOCUMENT ....................................................................................... 13 1.2 STATEMENT OF RESPONSIBILITY ....................................................................................................................... 13

2. STATUTORY AUDITORS .................................................................................................................................................... 14

2.1 THE ISSUER'S STATUTORY AUDITORS .............................................................................................................. 14 2.2 INFORMATION ON THE RELATIONSHIPS WITH THE AUDITOR ............................................................................. 14

3. SELECTED FINANCIAL INFORMATION ....................................................................................................................... 15

3.1 SELECTED CONSOLIDATED FINANCIAL INFORMATION ON THE YEARS ENDED 31 DECEMBER 2012, 2011 AND 2010 ................................................................................................................................................................. 16

3.1.1 Selected consolidated economic information on the Issuer for the years ended 31 December 2012, 2011 and 2010.................................................................................................................................................... 16

3.1.2 Analysis of revenues for the years ended 31 December 2012, 2011 and 2010 ......................................... 17 3.1.3 Consolidated balance sheets for the years ended 31 December 2012, 2011 and 2010 ............................ 17 3.1.4 Net working capital ................................................................................................................................... 18 3.1.5 Other accounts receivable, accrued income and prepaid expenses and other accounts payable, accrued

expenses and deferred income .................................................................................................................. 18 3.1.6 Tangible fixed assets, goodwill and intangible fixed assets, long-term investments ................................. 18 3.1.7 Non-current liabilities ............................................................................................................................... 19 3.1.8 Shareholders’ equity ................................................................................................................................. 19 3.1.9 Net financial position ................................................................................................................................ 19 3.1.10 Selected data regarding the Issuer's cash flows for the years ended 31 December 2012 and 2011 ......... 20

4. RISK FACTORS ..................................................................................................................................................................... 21

5. ISSUER’S PROFILE .............................................................................................................................................................. 29

5.1 ISSUER’S BACKGROUND AND EXPANSION ......................................................................................................... 29 5.1.1 Issuer’s registered name and trade name ................................................................................................. 29 5.1.2 Issuer’s place of registration and Registration number ............................................................................ 29 5.1.3 Issuer’s date and term of incorporation .................................................................................................... 29 5.1.4 Issuer’s address and legal status, applicable law, country of incorporation, address and telephone

number of the registered office ................................................................................................................. 29 5.1.5 Significant events in the Issuer’s business activity .................................................................................... 29

5.2 INVESTMENTS ................................................................................................................................................... 31 5.2.1 Description of the Group’s investments in tangible, intangible and financial assets during the years

ended 31 December 2012, 2011 and 2010 and until the date of the Admission Document ...................... 31 5.2.2 Description of major ongoing investments ................................................................................................ 32 5.2.3 Future investments .................................................................................................................................... 32

6. BUSINESS OVERVIEW ........................................................................................................................................................ 33

6.1 CORE BUSINESS ................................................................................................................................................ 33 6.1.1 Overview of the Group’s business and key factors ................................................................................... 33 6.1.2 Products and services ............................................................................................................................... 36

6.1.2.1 Eyewear and Lifestyle Products ............................................................................................................................. 36 6.1.2.2 Communication ...................................................................................................................................................... 40

6.1.3 Business organization model ..................................................................................................................... 41 6.1.3.1 Research, design and product development ........................................................................................................... 42 6.1.3.2 Production, logistics and customer care ................................................................................................................. 42

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6.1.3.3 Distribution ............................................................................................................................................................ 43 6.1.3.4 Communication. Italia Independent as a brand ...................................................................................................... 47 6.1.3.5 Activities of Independent Ideas .............................................................................................................................. 48

6.1.4 Other activities .......................................................................................................................................... 49 6.1.4.1 I Spirits .................................................................................................................................................................. 49 6.1.4.2 Sound Identity ........................................................................................................................................................ 49 6.1.4.3 Independent Value Card......................................................................................................................................... 49 6.1.4.4 We Care ................................................................................................................................................................. 50

6.1.5 Strategy and future programmes ............................................................................................................... 50 6.2 MAIN MARKETS IN WHICH THE GROUP IS OPERATING ....................................................................................... 51

6.2.1 Reference market ....................................................................................................................................... 51 6.2.2 Competitive positioning ............................................................................................................................ 53

6.3 EXCEPTIONAL FACTORS INFLUENCING THE ISSUER’S ACTIVITIES OR REFERENCE MARKETS ............................. 54 6.4 ISSUER’S DEPENDENCE ON PATENTS OR LICENCES, INDUSTRIAL, COMMERCIAL OR FINANCIAL CONTRACTS, OR

NEW MANUFACTURING PROCEDURES ................................................................................................................ 54 6.5 SOURCE OF THE STATEMENTS MADE BY THE ISSUER ON ITS COMPETITIVE POSITIONING ................................... 55

7. ORGANIZATION .................................................................................................................................................................. 56

7.1 DESCRIPTION OF THE GROUP OF WHICH THE ISSUER IS A COMPONENT .............................................................. 56 7.2 COMPANIES CONTROLLED AND PARTICIPATED BY THE ISSUER ......................................................................... 56

7.2.1 Subsidiaries ............................................................................................................................................... 56 7.2.2 Other companies of which the Issuer owns interests in capital stock ....................................................... 56

8. BUILDINGS, PLANTS AND MACHINERY ....................................................................................................................... 58

8.1 INFORMATION ON EXISTING OR EXPECTED TANGIBLE ASSETS, INCLUDING LEASED PROPERTY ......................... 58 8.2 ENVIRONMENTAL FACTORS LIABLE TO IMPACT ON THE USE OF TANGIBLE ASSETS ........................................... 59

9. INFORMATION ON EXPECTED TRENDS ...................................................................................................................... 59

9.1 RECENT SIGNIFICANT TRENDS THAT HAVE EMERGED CONCERNING PRODUCTION, SALES AND STOCK AS WELL AS COST AND SALES PRICE EVOLUTION ............................................................................................... 59

9.2 INFORMATION ON TRENDS, UNCERTAINTIES, COMMITMENTS OR KNOWN FACTS WHICH MAY REASONABLY LEAD TO SIGNIFICANT REPERCUSSIONS ON THE ISSUER’S PROSPECTS AT LEAST FOR THE CURRENT

FINANCIAL YEAR ............................................................................................................................................... 59

10. EXPECTED OR ESTIMATED INCOME............................................................................................................................ 60

11. ADMINISTRATION, MANAGEMENT OR MONITORING BODIES AND TOP MANAGEMENT .......................... 61

11.1 INFORMATION ON ADMINISTRATION, MANAGEMENT AND MONITORING BODIES ............................................... 61 11.1.1 Board of Directors .................................................................................................................................... 61 11.1.2 Board of Auditors ...................................................................................................................................... 63 11.1.3 CEO and top management ........................................................................................................................ 67

11.2 CONFLICT OF INTEREST OF THE MEMBERS OF THE ADMINISTRATION, MANAGEMENT AND MONITORING BODIES AND TOP MANAGEMENT .................................................................................................................................... 67

12. POLICY OF THE BOARD OF DIRECTORS ..................................................................................................................... 68

12.1 TERM OF THE MEMBERS OF THE BOARD OF DIRECTORS AND BOARD OF AUDITORS ......................................... 68 12.2 EMPLOYMENT CONTRACT SIGNED BY MEMBERS OF THE ADMINISTRATION, MANAGEMENT AND MONITORING

BODIES OF THE ISSUER OF WITH SUBSIDIARIES ENVISAGING A SEVERANCE PAY ................................................ 68 12.3 STATEMENT ON THE COMPLIANCE WITH THE LAWS ON CORPORATE GOVERNANCE .......................................... 68

13. EMPLOYEES ......................................................................................................................................................................... 69

13.1 GROUP’S ORGANISATIONAL CHART .................................................................................................................. 69 13.2 EMPLOYEES ...................................................................................................................................................... 69

13.2.1 Number of employees ................................................................................................................................ 69 13.3 SHAREHOLDING AND STOCK OPTIONS ............................................................................................................... 69 13.4 DESCRIPTION ANY EMPLOYEE SHAREHOLDING AGREEMENTS ........................................................................... 70

14. MAJOR SHAREHOLDERS .................................................................................................................................................. 71

14.1 SHAREHOLDERS HOLDING FINANCIAL INSTRUMENTS TO AN EXTENT GREATER THAN 5% OF THE ISSUER’S SHARE CAPITAL................................................................................................................................................. 71

14.2 SPECIAL VOTING RIGHTS OF MAJOR SHAREHOLDERS ........................................................................................ 71 14.3 ENTITY CONTROLLING THE ISSUER ................................................................................................................... 71

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14.4 AGREEMENTS WHOSE EXECUTION MAY CAUSE A CHANGE IN THE ISSUER’S CONTROL AFTER THE PUBLICATION OF SHAREHOLDING OF THE ISSUER SUBSEQUENTLY TO THE PUBLICATION OF THE ADMISSION DOCUMENT ...... 71

15. TRANSACTIONS WITH RELATED PARTIES ................................................................................................................. 72

15.1 INTRA-GROUP TRANSACTIONS AND DIRECTORS’ FEES ...................................................................................... 72

16. ADDITIONAL INFORMATION .......................................................................................................................................... 72

16.1 SHARE CAPITAL ................................................................................................................................................ 74 16.1.1 Amount of the issued share capital ........................................................................................................... 74 16.1.2 Shares not representing capital ................................................................................................................ 74 16.1.3 Treasury shares ......................................................................................................................................... 74 16.1.4 Amount of convertible securities, exchangeable bonds and warrants ...................................................... 74 16.1.5 Existence of purchase rights or obligations on authorized but not issued capital or of a commitment to

increase capital ......................................................................................................................................... 74 16.1.6 Additional information regarding the capital of any member of the Group offered under an option ....... 74 16.1.7 Development regarding the Issuer’s share capital in the last three years ................................................ 74

16.2 ARTICLES OF INCORPORATION AND BYLAWS ................................................................................................... 75 16.2.1 Business purpose ....................................................................................................................................... 75 16.2.2 Bylaws provisions concerning the members of the Control, Management and Supervisory Boards ........ 75 16.2.3 Rights, privileges and restrictions granted to existing shares................................................................... 77 16.2.4 Bylaws provisions concerning changes to the rights of share owners, with indication of the cases where

conditions are more significant than legal conditions ............................................................................ 778 16.2.5 Meeting calling process ............................................................................................................................ 78 16.2.6 Description of any Bylaws provisions that may have the effect of delaying, deferring or preventing a

change to the Issuer's control structure .................................................................................................... 78 16.2.7 Description of any Bylaws provisions that regulate the ownership threshold above which the obligation

to disclose shareholdings to the public applies ......................................................................................... 78 16.2.8 Conditions set forth in the Articles of Incorporation and Bylaws for changes to the share capital in the

event that these conditions are more restrictive than statutory conditions ............................................... 79

17. SIGNIFICANT AGREEMENTS ........................................................................................................................................... 80

18. INFORMATION RECEIVED FROM THIRD PARTIES, EXPERT OPINIONS AND STATEMENTS OF INTEREST .............................................................................................................................................................................. 82

18.1 INFORMATION RECEIVED FROM THIRD PARTIES, EXPERT OPINIONS AND STATEMENTS OF INTEREST ................. 82 18.2 CERTIFICATION CONCERNING INFORMATION RECEIVED FROM THIRD PARTIES, EXPERT OPINIONS AND

STATEMENTS OF INTEREST ................................................................................................................................ 82

19. INFORMATION ON SHAREHOLDINGS .......................................................................................................................... 83

PART TWO .............................................................................................................................................................................................

.................................................................................................................................................................................................. 84

1. PERSONS IN CHARGE ........................................................................................................................................................ 85

1.1 PERSONS IN CHARGE OF THE ADMISSION DOCUMENT ....................................................................................... 85 1.2 STATEMENT OF RESPONSIBILITY ....................................................................................................................... 85

2. RISK FACTORS ..................................................................................................................................................................... 86

3. ESSENTIAL INFORMATION .............................................................................................................................................. 87

3.1 STATEMENT ON THE WORKING CAPITAL ........................................................................................................... 87 3.2 REASONS OF THE CAPITAL INCREASE AND USE OF REVENUES ........................................................................... 87

4. INFORMATION REGARDING FINANCIAL INSTRUMENTS TO BE ADMITTED TO ............................................... TRADING ................................................................................................................................................................................ 88

4.1 TYPE AND CLASS OF FINANCIAL INSTRUMENTS OFFERED TO THE PUBLIC AND ADMITTED TO TRADING ............ 88 4.2 LEGISLATION BASED ON WHICH THE SHARES WILL BE ISSUED .......................................................................... 88 4.3 CHARACTERISTICS OF THE SHARES .................................................................................................................. 88 4.4 SHARE ISSUANCE CURRENCY ............................................................................................................................ 88 4.5 DESCRIPTION OF THE RIGHTS, INCLUDING ANY LIMIT, ASSOCIATED WITH THE SHARES AND PROCEDURE FOR

THEIR EXERCISE ................................................................................................................................................ 88 4.6 RESOLUTIONS, AUTHORIZATIONS AND APPROVALS REQUIRED FOR THE PAST OR FUTURE CREATION/ISSUING OF

FINANCIAL INSTRUMENTS ................................................................................................................................. 88

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4.7 EXPECTED FINANCIAL INSTRUMENT ISSUANCE DATE ........................................................................................ 88 4.8 DESCRIPTION OF ANY RESTRICTIONS TO THE FREE TRANSFERABILITY OF THE SHARES ..................................... 88 4.9 APPLICABILITY OF PUBLIC OFFER OR RESIDUAL PURCHASE OFFER REGULATIONS............................................. 89 4.10 PREVIOUS PUBLIC PURCHASE OFFERS ON THE ISSUER'S SHARES ....................................................................... 89 4.11 TAXATION ........................................................................................................................................................ 89

4.11.2 Dividend taxation system 93

4.12 STABILIZATION ................................................................................................................................................. 97

5. OWNERS OF FINANCIAL INSTRUMENTS TO BE OFFERED FOR SALE................................................................ 98

5.1 INFORMATION ON ENTITIES OFFERING FINANCIAL INSTRUMENTS FOR SALE ...................................................... 98 5.2 NUMBER AND CLASS OF THE FINANCIAL INSTRUMENTS OFFERED BY EACH OWNER OF THE FINANCIAL

INSTRUMENTS OFFERED FOR SALE .................................................................................................................... 98 5.3 LOCK-UP AGREEMENTS .................................................................................................................................... 98

6. EXPENSES ASSOCIATED WITH THE ADMISSION .................................................................................................... 100

6.1 NET TOTAL REVENUES AND ESTIMATE OF TOTAL EXPENSES ASSOCIATED WITH ADMISSION .......................... 100

7. DILUTION ............................................................................................................................................................................ 101

7.1 AMOUNT AND PERCENTAGE OF THE IMMEDIATE DILUTION RESULTING FROM THE OFFER ............................... 101 7.2 DILUTIVE EFFECTS IN CASE OF NON-SUBSCRIPTION OF THE OFFER .................................................................. 101

8. ADDITIONAL INFORMATION ........................................................................................................................................ 102

8.1 CONSULTANTS ................................................................................................................................................ 102 8.2 INDICATION OF ADDITIONAL INFORMATION CONTAINED IN PART TWO TO BE AUDITED OR SUBJECT TO LIMITED

AUDIT BY THE AUDITOR ................................................................................................................................. 102 8.3 EXPERT OPINIONS OR REPORTS ....................................................................................................................... 102 8.4 INFORMATION RECEIVED FROM THIRD PARTIES .............................................................................................. 102

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DEFINITIONS AND GLOSSARY

A list of the main definitions and terms used in this Admission Document is given below. These definitions and terms

shall be intended with the meaning specified below, except where otherwise specified.

Admission The admission of the Shares to trading on AIM Italia.

Admission Date Date of the Borsa Italiana admission provision.

Admission Document This Admission Document.

Admission Document Date Date of publication of the Admission Document by the Issuer.

AIM Issuers’ Regulations AIM (Alternative Investment Market) Italia Issuers’ Regulations by

Borsa Italiana of 1 march 2012.

AIM Italia AIM Italia/Alternative Investment Market, multilateral trading system

organized and managed by Borsa Italiana S.p.A.

Auditor Deloitte & Touche S.p.A., headquartered in Milan, via Tortona n. 25,

with a fully registered and paid-up share capital of Euro 10,328,220.00,

tax code and VAT number and registration in the Register of Companies

of Milan no. 03049560166, registered in the Register Auditors, as per

Leg. Dec. no. 88 of 27 January 1992 and pursuant to Art. 13 of Leg.

Dec. no. 39 of 27 Jan. 2010.

Banca IMI Banca IMI S.p.A., headquartered in Largo Mattioli n. 3, Milan.

“Below the line” activities Any communication activity other than advertising and the activities

conveyed through the traditional media, such as TV, radio, advertising

and billposting, including sponsoring, public relations, direct marketing

and promotions.

Borsa Italiana Borsa Italiana S.p.A., the Italian stock exchange, headquartered in

Milan, Piazza degli Affari n. 6.

Bylaws The Issuer’s corporate Bylaws, as amended by the Extraordinary

Meeting’ Resolution of 29 May 2013 effective from the Admission

Date.

Capital Increase An increase in the share capital, on a paid and divisible basis, with the

exclusion of the right of option pursuant to art. 2441, paragraph 5, of the

Civil Code, from Euro 1,785,000 up to nominal maximum amounts of

Euro 2,285,000, by issuing a maximum of 500,000 Shares for the

Admission deliberated on by the Issuer’s Extraordinary Meeting of 29

May 2013. In execution of the aforesaid meeting resolution, the Issuer’s

Board of Directors of June 25th

, 2013 deliberated on issuing a maximum

of no. 425,000 Shares for Admission at a minimum subscription price of

Euro 26.00 for each New Share (the “New Shares”).

Co-branding The cooperation between the Group and partnering aimed at jointly

realizing products and initiatives identified by the matching of the

respective brands.

Code of Self-Regulation Code of Self-Regulation of Listed Companies, approved by the

Committee for Corporate Governance of Listed Companies in December

2011.

Consob National Commission for the Companies and the Stock Exchange,

created with Law no. 216 of 7 June 1974.

Consolidated Finance Act Legislative Decree no. 58 of 24 February 1998, as subsequently

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amended and supplemented.

Equita Equita SIM S.p.A., headquartered in Milan, via Turati 9, Register of

Companies of Milan, tax code and and VAT number 10435940159, with

a fully registered and paid-up share capital of Euro 26,793,000,

registered in the Albo delle SIM [Register of Securities Trading

Companies] with no. 67.

Group The Issuer and the companies under its control, pursuant to Art. 2359,

paragraph 1, no. 1, of the Civil Code, and included in the consolidation

area.

IFRS All the International Financial Reporting Standards (IFRS), all the

International Accounting Standards (IAS), all the interpretations of the

International Reporting Interpretations Committee (IFRIC), previously

called “SIC”, adopted by the European Union.

Independent Ideas Independent Ideas S.r.l., headquartered in Torino, corso XI febbraio, 19,

tax code and VAT number and registered in the Register of Companies

of Turin no. 09599540011, R.E.A. (Repertorio Economico

Amministrativo - Economic Administrative Index] no. 1065191.

Institutional Placement or Placement The offer of the New Shares and Sale Shares to qualified investors in

Italy and to institutional investors abroad in proximity of the admission

to trading on AIM Italia, pursuant to Art. 6 of Part II (“Guidelines”) of

the AIM Issuers’ Regulations, within the framework of a private

placement, falling under the cases of inapplicability of the provisions

regulating the public offer of financial instruments defined n Art. 100 of

the Consolidated Finance Act and Art. 34-ter of Regulation 11971 and

equivalent legal and statutory provisions applicable abroad and therefore

without public offer.

Issuer or Italia Independent Group or

Company

Italia Independent Group S.p.A., headquartered in Turin, Corso XI

Febbraio n. 19, with tax code and VAT number and registration in the

Register of Companies of Turin no. 09898980017, R.E.A. (Repertorio

Economico Amministrativo - Economic Administrative Index] no.

1089873.

Italia Independent Italia Independent S.p.A., headquartered in Torino, corso XI febbraio,

19, tax code and VAT number and registered in the Register of

Companies of Turin no. 09424180017, R.E.A. (Repertorio Economico

Amministrativo - Economic Administrative Index] no. 1050737.

Italian Accounting Principles Legal provisions in force at the reference date of each financial

statement of the Issuer and Group, that inspire the reporting criteria used

to interpret accounting information and supplemented by the accounting

principles issued by the Consiglio Nazionale dei Dottori Commercialisti

e dei Ragionieri [National Council of Chartered Accountants] and,

where applicable, by the interpretation documents prepared by the

Organismo Italiano di Contabilità [Italian Accounting Board].

Lifestyle Products The articles of clothing and accessories distributed by the Group in the

lifestyle fashion industry.

Monte Titoli Monte Titoli S.p.A., the Italian central securities depository,

headquartered in Milan, Via Andrea Mantegna no. 6.

New Shares A maximum of no. 425,000 Shares, corresponding to an aggregate

amount of nominal Euro 425,000, corresponding to the capital increase

offered for subscription within the framework of the Institutional

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Placement.

Nomad (Nominated Adviser) Equita SIM S.p.A., headquartered in Milan, via Turati 9, Register of

Companies of Milan, tax code and VAT number 10435940159, with a

fully registered and paid-up share capital of Euro 26,793,000, registered

in the Albo delle SIM [Register of Securities Trading Companies] with

no. 67.

Over Allotment Option The purchase option granted to the Joint Global Coordinators for the

purchase of a maximum number of 78,750 Shares to be allocated to the

qualified investors and the other institutional investors for whom the

Placement is meant in case of “over allotment”, as described in Part

Two, Chapter 5, Section 5.2.

Regulation 11971 Regulation implementing Legislative Decree no. 58 of 24 February 1998

on the regulation of issuers, adopted by Consob with Resolution no.

11971 of 14 May 1999, as subsequently amended and supplemented.

Related Parties As defined in the Regulation adopted by Consob with Resolution no.

17221 of 12 March 2010, as subsequently amended and supplemented,

which sets forth provisions regarding transactions with Related Parties.

Retail The Group’s direct retail sales.

Sale Shares The maximum number of 100,000 Shares of the Selling Shareholders

offered for sale within the framework of the Institutional Placement.

Sell-out The final retail sale of the Group’s products to consumers.

Selling Shareholders The Company’s shareholders indicated in Part Two, Chapter 5, Section

5.2 of the Admission Document.

Shares The ordinary shares of the Issuer, with a nominal value of Euro 1.00

each.

Stock Option Plan Indicates the Stock Option Plan 2012-2022 described in Part One,

Chapter 13, Section 13.3 of the Admission Document.

Wholesale The distribution channel of third-party operators used by the Group for

the sale of its products to retailers.

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DOCUMENTS ACCESSIBLE TO THE PUBLIC

The following documents are available to the public at the Issuer’s headquarters (in Corso XI febbraio n. 19, Turin), as

well as on the web site www.italiaindependentgroup.com:

Admission Document

Issuer’s Bylaws

Company financial statements for the year ended 31 December 2012 prepared according to the Italian accounting principles and approved by the Company Shareholders’ Meeting on 29 May 2013

Auditor’s report on the Company’s Financial Statements for the year ended 31 December 2012 issued on 24 May 2013

The Group’s Consolidated Financial Statements for the year ended 31 December 2012, prepared in compliance with the Italian Accounting Principles and approved by the Board of Directors of the Company on 16 May

2013

The Auditor’s report on the Group’s Consolidated Financial Statements for the year ended 31 December 2012 issued on 24 May 2013.

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ADDITIONAL INFORMATION

Calendar of the operation

Admission Document Date June 26th

, 2013

Admission Date June 26th

, 2013

Expected negotiating start date June 28th

, 2013

Main information on the Issuer’s share capital

Nominal Share capital at the Admission Document Date Euro 1,785,000

Number of Shares at the Admission Document Date 1,785,000

Nominal value of each Share Euro 1.00

Shortly before Admission, the Shares involved in the Institutional Placement have been offered for subscription and for

sale to qualified investors in Italy and institutional investors abroad pursuant to Art. 6 of Part II (“Guidelines”) of the

AIM Issuers’ Regulations, within the framework of a private placement falling under the cases of inapplicability of the

provisions regulating the public offer of financial instruments set forth in Art. 100 of the Consolidated Finance Act and

Art. 34-ter of Regulation 11971, as well as of the equivalent legal and statutory provisions applicable abroad, and

therefore without public offer of subscription or dale of Shares. For additional information on the Capital Increase,

please see Part Two, Chapter 4, Section 4.6.

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PART ONE

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1. INFORMATION ON THE PERSONS IN CHARGE OF THE ADMISSION DOCUMENT

1.1 Persons in charge of the Admission Document

The Issuer is responsible for the completeness and truthfulness of the data and information contained in the Admission

Document.

1.2 Statement of responsibility

The Issuer hereby represents that, having acted with reasonable diligence for this purpose, the information and data

contained herein are, as far as he is aware of, compliant with facts and have no omissions that may alter their meaning.

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2. STATUTORY AUDITORS

2.1 The Issuer's Statutory Auditors

On 19 December 2012, the The Meeting of the Company entrusted the Auditor with the task of auditing the accounts of

the Company for the years 2012, 2013 and 2014 pursuant to Art. 13 of Leg. Dec. 39/2010.

On 29 May 2013, the Meeting of the Company deliberated on integrating, subject to Admission, the auditing of the

year’s financial statement and of the consolidated financial statements for the years ended 2013, 2014 and 2015 with the

limited auditing of the Mid-Year Report regarding each of the interim periods closing until 30 June 2015 conferred on

the Auditor.

That task also includes the issuing by the Auditor of an “opinion” on each year’s and consolidated financial

statement/balance sheet of the Company and on each Mid-Year Report for each of the years considered pursuant to Art.

14 of Leg. Dec. 39/2010.

The consolidated financial statements of the Group and the year’s financial statement closed for the year ended 31

December 2012 have been prepared in compliance with Italian Accounting Principles and audited by the Auditor on a

voluntary and statutory basis, respectively, which expressed a favourable opinion. The Auditor’s reports have been

issued on 24 May 2013.

2.2 Information on the relationships with the Auditor

Until the Admission Document Date, the task conferred on the Auditor by the Issuer was neither cancelled nor waived

by the Auditor.

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3. SELECTED FINANCIAL INFORMATION

BACKGROUND

This Chapter provides selected financial information regarding the annual consolidated accounts of the Issuer for the

years ended 31 December 2012, 2011 and 2010. We point out that the Group prepared consolidated financial statements

for the year ended 31 December 2012 for the first time and that the consolidated data regarding the years 2011 and 2010

are provided on a pro-forma basis and exclusively for information purposes for their inclusion in this Admission

Document.

The year’s financial statement of the Company and the Group’s consolidated financial statement for the year ended 31

December 2012 have been audited by the Auditor, who issues an Audit Report on 24 May 2013. The pro-forma

consolidated financial information regarding the years ended 31 December 2011 and 31 December 2010 have not been

audited by the Auditor.

The pro-forma consolidated financial information regarding the year ended 31 December 2010 have been prepared

assuming that the Issuer’s acquisition process regarding the Subsidiaries (Italia Independent and Independent Ideas),

concluded during 2011, had taken place with reference to the year ended 31 December 2010. Therefore, pro-forma

consolidated financial information for the year ended 31 December 2010 was prepared by fully aggregating the year’s

financial statement of the Holding with the year’s financial statements of the two Subsidiaries, prepared according to

the Italian Accounting Principles used by the Holding. The financial statements of “Italia Independent” and

“Independent Ideas” for the years ended 31 December 2010 and 31 December 2011 have not been audited under any

form (including limited auditing).

In detail, the following conditions were assumed when preparing the pro-forma consolidated financial information for

the year ended 31 December 2010:

The Issuer already owned, for the year ended 31 December 2010, a stake in the Company “Italia Independent” (former “LA S.p.A.”) (corresponding to 72.5% of the share capital) for a book value of Euro 950,000, and a

stake in the Company “Independent Ideas” (former “LA Communication S.r.l.”) (corresponding to 75% of the

share capital) for a book value of Euro 112,170.

After the completion of the aforesaid transactions, the pro-forma consolidation process showed a consolidation difference of Euro 951,724 (related to “Italia Independent” for Euro 863,001 and to “Independent Ideas” for

Euro 88,723) resulting from the deletion of the book value of the stakes (for Euro 1,062,170, related to “Italia

Independent” for Euro 950,000 and to “Independent Ideas” for Euro 112,170) against the corresponding

shareholders’ equity portion for the same amount for the year ended 31 December 2010 (corresponding to

Euro 110,446, related to “Italia Independent” for Euro 86,999 and to “Independent Ideas” for Euro 23,447).

The consolidation difference has been amortized starting from 2011.

The Issuer’s shareholders’ equity already contained for the year ended 31 December 2010:

o the capital increase of Euro 36,850 (completed in 2011), after which the share capital of the Company became of Euro 116,850;

o the recording of a share premium reserve of Euro 1,833,900, consisting of 931,250 corresponding to the capital increase completed by contributing the stake held by Lapo Edovard Elkann in “Italia

Independent” and Euro 902,650 corresponding to the cash capital increases contributed in the course

of 2011;

o the recording of a reserve of Euro 10,022 resulting from the merger with “Tessitore & Associates S.r.l.”.

In summary, the acquisition of the Subsidiaries have been considered together with capital-related transactions due to

their close correlation.

The pro-forma consolidated financial information regarding the year ended 31 December 2011 were prepared assuming

that the acquisition of the Subsidiaries “Italia Independent” and “Independent Ideas” by the Issuer had been completed,

in June 2011 and August 2011, respectively, referring to the year ended 31 December 2010, therefore the Income

Statement as of 31 December 2011 reflects the consolidation of the entire year 2011, consistently with the income

statement as at 31 December 2010, which reflects the consolidation of the entire year 2010.

The selected financial information are inferred from the Issuer’s consolidated financial statements for the year ended 31

December 2012 and from the pro-forma consolidated financial information for the year ended 31 December 2011 and

2010, prepared in compliance with the applicable legislation, supplemented and interpreted with Italian Accounting

Principles.

16

However, we highlight again that the consolidated financial information provided consists of a simulation of the

possible effects that might have been the result of the transactions, disclosed for mere information purposes. More

specifically, since pro-forma consolidated financial information is built to retrospectively reflect the effects of

subsequent transactions, there are limits associated with the very nature of pro-forma information, in spite of the

compliance with commonly accepted regulations and the use of reasonable assumptions. Furthermore, in consideration

of the different purposes of pro-forma information compared to actual financial statements and of the different methods

used for the calculation of the effects of transactions in connection with the pro-forma balance sheet and income

statement, these accounts must be read and interpreted separately, without looking for any accounting connection

between them.

This chapter does not include the Issuer’s yearly financial statements referring to each of the dates indicated above.

The selected financial information given below must be read together with the financial statement for the year ended 31

December 2012 and with the Issuer’s consolidated financial statements for the year ended 31 December 2012 enclosed

with this Admission Document and made available to the public for consultation in the places indicated in the

introduction of this Admission Document.

3.1 Selected consolidated financial information on the years ended 31 December 2012, 2011 and 2010

3.1.1 Selected consolidated economic information on the Issuer for the years ended 31 December 2012, 2011 and 2010

The main economic data of the Issuer for the years ended 31 December 2012, 2011 and 2010 are given below:

(in Euro units) 2012 %

Pro-forma

2011 %

Pro-forma

2010 %

Gross revenue 16,673,227 106.4% 10,081,417 104.3% 5,350,785 96.3%

Returns (1,858,737) -11.9% (816,897) -8.5% (323,780) -5.8%

Net revenue 14,814,490 94.6% 9,264,520 95.9% 5,027,005 90.4%

Other revenues and income (royalties) 851,453 5.4% 397,593 4.1% 531,254 9.6%

Total revenues 15,665,943 100.0% 9,662,113 100.0% 5,558,259 100.0%

Changes in inventories of intermediate goods, semi-

finished and finished products 1,210,931 7.7% 384,146 4.0% 321,379 5.8%

T Value of production (revenue accounts) 16,876,874 107.7% 10,046,259 104.0% 5,879,638 105.8%

Costs for raw & ancillary materials, consumables and

goods (5,105,064) -32.6% (2,393,277) -24.8% (1,395,615) -25.1%

Costs for services (6,801,883) -43.4% (5,093,118) -52.7% (3,574,956) -64.3%

Costs for leased assets (262,923) -1.7% (253,592) -2.6% (227,238) -4.1%

Cost of personnel (1,515,866) -9.7% (607,714) -6.3% (207,237) -3.7%

Sundry operating expenses (216,187) -1.4% (225,577) -2.3% (92,173) -1.7%

EBITDA (*) 2,974,951 19.0% 1,472,981 15.2% 382,419 6.9%

Amortization of intangible fixed assets (186,670) -1.2% (207,027) -2.1% (108,722) -2.0%

Depreciation of tangible fixed assets (116,891) -0.7% (59,855) -0.6% (41,499) -0.7%

Other provisions (210,613) -1.3% (255,000) -2.6% (840,000) -1.4%

Credit impairment (221,959) -1.4% (166,711) -1.7% (20,000) -0.4%

EBIT (**) 2,238,818 14.3% 784,388 8.1% 132,198 2.4%

Financial charges (221,822) -1.4% (151,776) -1.6% (76,807) -1.4%

Financial income 6,417 0.0% 605 0.0% 33 0.0%

Exchange rate profit (loss) (463) 0.0% 49 0.0% 0 0.0%

Net financial income (charges) (215,868) -1.4% (151,122) -1.6% (76,774) -1.4%

Write-up of financial assets 11,357 0.1% 16,670 0.2% 1,191 0.0%

Write-down of financial assets (214,016) -1.4% 0 0.0% (15,300) -0.3%

Value adjustments to net financial assets (202,659) -1.3% 16,670 0.2% (14,109) -0.3%

Non-recurring charges (117,130) -0.7% (155,444) -1.6% (92,000) 1.7%

Non-recurring income 1,921 0.0% 1 0.0% 4,883 0.1%

Net non-recurring income (charges) 115,209 -0.7% (155,443) -1.6% (87,117) 1.6%

Result before tax 1,705,082 10.9% 494,493 5.1% (45,802) -0.8%

Current taxes (703,411) -4.5% (266,365) -2.8% (116,458) -2.1%

Deferred taxes (94,205) -0.6% (79,024) -0.8% (569) 0.0%

Year’s result 907,466 5.8% 149,104 1.5% (162,829) -2.9%

17

(*) The EBITDA indicates earnings before financial and non-recurring operations, taxes, amortization/depreciation of fixed

assets, provisions and bad debt and inventories, and, more specifically, does not include non-recurring expenses (Euro 117K

in 2012, Euro 155K in 2011 and Euro 92K in 2010), the provision for the Directors’ severance pay (Euro 55K in 2012 and in

2011) and the provision for inventory write-down (Euro 50K in 2012 and Euro 40K in 2010). The EBITDA so defined is the

indicator used by the Issuer’s Directors to monitor and assess business operation trends. Since the EBITDA is not identified as

an accounting criterion among national accounting principles, it should not be considered as an alternative method to measure

or assess the Issuer’s operating trends. In addition, the composition of the EBITDA is not regulated by any reference

accounting principles, so the criterion used by the Company for its determination may not be consistent with the criterion

adopted by other entities, and therefore cannot be used for comparisons.

(**) The EBIT indicates earnings before financial, non-recurring operations and year’s taxes, therefore it represents the

operating result before any return on both borrowed capital and owners’ equity. The EBIT so defined is the indicator used by

the Issuer’s Directors to monitor and assess business operation trends. Since the EBIT is not identified as an accounting

criterion among national accounting principles, it should not be considered as an alternative method to measure or assess the

Issuer’s operating trends. In addition, since the composition of the EBIT is not regulated by any reference accounting

principles, so the criterion used by the Company for its determination may not be consistent with the criterion adopted by

other entities, and therefore cannot be used for comparisons.

3.1.2 Analysis of revenues for the years ended 31 December 2012, 2011 and 2010

The details of the composition of the “Consolidated revenues for the years ended 31 December 2012, 2011 and 2010”

item are given below, organized by category of activity:

(thousand Euro) 2012 %

Pro-forma

2011 %

Pro-forma

2010 %

Eyewear 11,478,871 73% 5,665,112 59% 2,733,717 49%

Lifestyle Products 480,177 3% 273,051 3% 495,185 9%

Communication 3,706,895 24% 3,723,950 39% 2,329,357 42%

Total Revenues 15,665,943 100% 9,662,113 100% 5,558,259 100%

(*) Information on revenues has been extracted from the consolidated financial statement as of 31 December 2012 and

from pro-forma consolidated reports as of 31 December 2011 and 2010, without considering changes in inventories.

3.1.3 Consolidated balance sheets for the years ended 31 December 2012, 2011 and 2010

Information concerning the main equity indicators is given below regarding the years ended 31 December 2012, 2011

and 2010. In detail, the table below shows the reclassified sources and uses of the balance sheet as of 31 December

2012, 2011 and 2010:

(thousand Euro) 2012 Pro-forma 2011 Pro-forma 2010

USES

Net Working Capital 4,551,689 3,638,671 2,601,143

Fixed assets 3,588,402 1,480,289 1,443,958

Non-current assets - - -

Non-current liabilities (541,678) (239,228) (23,827)

Net invested capital (2) 7,598,413 4,879,732 4,021,274

SOURCES

Shareholders’ Equity 3,879,386 2,193,555 2,044,451

Net financial position (3) 3,719,027 2,686,177 1,976,823

Total Sources of Financing 7,598,413 4,879,732 4,021,274

(1) The net working capital is defined as the difference between current assets and current liabilities, with the exclusion

of financial assets and liabilities. The net working capital is not identified as an accounting criterion among reference

accounting principles. We specify that it has been determined in compliance with CESR Recommendation 05-054b of

10 February 2005, reviewed on 23 March 2011 “Recommendations for a uniform implementation of the European

Commission’s Regulation on Prospectuses”. The determination criterion used by the Issuer may not be uniform with the

criterion adopted by other entities, therefore the balance obtained by the Issuer may not be comparable with the balance

determined by other entities.

(2) The net invested capital is defined as the algebraic sum of the net working capital, fixed assets and long-term

liabilities. It is not identified as an accounting criterion among reference accounting principles. The determination

18

criterion used by the Issuer may not be uniform with the criterion adopted by other entities, therefore the balance

obtained by the Issuer may not be comparable with the balance determined by other entities.

(3) According to CONSOB Communication no. DEM/6064293 of 28 July 2006, we specify that the net financial

position is defined as the algebraic sum of cash and cash equivalents, current financial assets and financial current and

non-current short- and long-term liabilities. The net financial position has been determined in compliance with CESR

Recommendation 05-054b of 10 February 2005, reviewed on 23 March 2011 “Recommendations for a uniform

implementation of the European Commission’s Regulation on Prospectuses”.

3.1.4 Net working capital

The composition of the Net Working Capital item for the years ended 31 December 2012, 2011 and 2010 is detailed in

the table below:

(thousand Euro) 2012

Pro-forma

2011

Pro-forma

2010

Trade receivables due within one year 7,954,804 4,886,672 2,775,731

Gross value 8,199,060 5,060,069 2,795,731

Reserve for bad debt (244,256) (173,397) (20,000)

Inventories 2,397,314 1,151,775 767,629

Gross value 2,447,314 1,151,775 807,629

Reserve for bad debt (50,000) - (40,000)

Other receivables, accrued income & prepaid expenses 723,251 432,130 874,986

Trade payables (5,232,372) (2,147,592) (1,641,831)

Other accrued expenses & deferred income (1,291,308) (684,314) (175,372)

Total 4,551,689 3,638,671 2,601,143

3.1.5 Other accounts receivable, accrued income and prepaid expenses and other accounts payable, accrued expenses and deferred income

The other current assets and liabilities for the years ended 31 December 2012, 2011 and 2010 are detailed in the table

below:

(thousand Euro) 2012

Pro-forma

2011

Pro-forma

2010

Tax receivables 318,933 6,561 161,982

Prepaid and deferred taxes receivable within the year 145,137 234,198 313,221

Other receivables due within one year 197,106 126,752 341,941

Accrued income & Prepaid expenses 62,075 64,619 57,842

Total other receivables, accrued income & prepaid expenses 723,251 432,130 874,986

Tax liabilities (821,030) (413,321) (89,044)

Accounts payable to pension and social security institutions (168,624) (96,025) (48,290)

Other accounts payable (156,866) (71,177) (17,266)

Accrued expenses & Deferred income (144,788) (103,791) (20,772)

Total other receivables, accrued expenses & deferred income (1,291,308) (684,314) (175,372)

3.1.6 Tangible fixed assets, goodwill and intangible fixed assets, long-term investments

Tangible and intangible fixed assets, goodwill and long-term investments for the years ended 31 December 2012, 2011

and 2010 are detailed in the table below:

(thousand Euro) 2012

Pro-forma

2011

Pro-forma

2010

Land and buildings 2.172.521 - -

Plants, machinery, industrial and commercial equipment 99.598 67.435 114.692

Other assets 242.543 156.174 54.581

Installation and expansion costs - 33.873 128.450

19

Research & Development and advertising costs - - 8,018

Concessions, licences, trademarks and similar rights 109,635 20,633 22,197

Other intangible assets 853,934 945,831 1,020,868

Stakes in controlled companies 12,181 - 10,000

- I-I Wall Street Corp. 12,181 - -

- LA France - - 10,000

Stakes in associated companies 86,178 72,948 35,152

Stakes held in other companies 2,125 - -

Other accounts receivable 9,687 183,395 50,000

Total 3,588,402 1,480,289 1,443,958

The increase in the “Land and Buildings” shown for 2012 results from the recording, with the financial method, of two

financial leasing agreements signed during the year for the buildings used as headquarters by the Issuer (Corso XI

febbraio n. 19, Turin).

3.1.7 Non-current liabilities

The other medium-long term liabilities for the years ended 31 December 2012, 2011 and 2010 are detailed in the table

below:

(thousand Euro) 2012

Pro-forma

2011

Pro-forma

2010

Employee termination indemnity (109,081) (39,228) (17,828)

Provision for risks and charges (432,597) (200,000) (5,999)

Other accounts payable - - -

Total (541,678) (239,228) (23,827)

3.1.8 Shareholders’ equity

The shareholders’ equity for the years ended 31 December 2012, 2011 and 2010 is detailed in the table below:

(thousand Euro) 2012

Pro-forma

2011

Pro-forma

2010

Share Capital 1,785,000 116,850 116,850

Share premium reserve 965,750 1,833,900 1,833,900

Legal reserve 1,930 1,347 649

Other reserves 47,270 30,617 10,022

Profit (loss) carried forward 86,832 10,623 152,661

Year’s profit (loss) 602,235 92,859 (120,745)

Group's Shareholders’ Equity 3,489,017 2,086,196 1,993,337

Third-Party's Shareholders’ Equity 390,369 107,359 51,114

Total Shareholders’ Equity 3,879,386 2,193,555 2,044,451

3.1.9 Net financial position

The negative net financial position shown according to the scheme recommended by Consob Communication no.

DEM/6064293 of 28 July 2006 for the years ended 31 December 2012, 2011 and 2010 is detailed in the table below:

(thousand Euro) 2012

Pro-forma

2011

Pro-forma

2010

A. Cash (39,376) (1,139) -

B. Other liquid assets (743,780) (379,901) (1,021,833)

C. Securities held for trading - (149,834) -

D. Cash and cash equivalents (A) + (B) + (C) (783,156) (530,874) (1,021,833)

E. Current financial receivables - - -

F. Short-term bank payables 2,031,539 2,117,653 2,156,481

G. Current portion of non-current liabilities 207,892 106,067 8,751

H. Other current financial liabilities 77,000 10,779 7,500

I. Current financial liabilities (F)+(G)+(H) 2,316,431 2,234,499 2,172,732

20

J. Net current financial liabilities (D) + (E) + (I) 1,533,275 1,703,625 1,150,899

K. Non-current bank liabilities 608,463 909,633 696,924

L. Issued bonds - - -

M. Other non-current liabilities 1,577,289 72,919 129,000

N. Non-current financial liabilities (K) + (L) + (M) 2,185,752 982,552 825,924

O. Net financial indebtedness (J) + (N) 3,719,027 2,686,177 1,976,823

3.1.10 Selected data regarding the Issuer's cash flows for the years ended 31 December 2012 and 2011

Cash flows for the years ended 31 December 2012 and 2011 are detailed in the table below:

2012

Pro-forma

2011

A. Cash flows from operating activity 601,324 (406,140)

After tax profit /(loss) 907,466 149,104

Adjustments for non-monetary costs and revenues 606,876 482,283

Amortization 303,561 266,882

Increase in provisions for risks and expenses 232,597 21,400

Increase in provisions for employee benefits 70,718 194,001

Change in the Net Working Capital (913,018) (1,037,528)

(Increase in trade receivables) (3,068,132) (2,110,941)

(Increase in sundry receivables) (291,121) 442,856

Reduction in inventories (1,245,539) (384,146)

(Decrease in trade receivables) 3,084,780 505,761

(Decrease in sundry receivables) 606,994 508,942

B. Cash flows from investment activities (2,411,674) (303,214)

(Purchase of buildings, plants and machinery) (2,411,674) (303,214)

C. Cash flows from financial activities 2,062,632 218,395

Proceeds from issued capital stock 800,000 0

Proceeds/(Reimbursements) of long-term loans 1,285,132 218,395

(Dividends paid) (22,500) 0

D. Net cash flows generated from operations (A ± B ± C) 252,282 (490,959)

E. Initial cash flows 530,874 1,021,833

F. Final cash flows (D ± E) 783,156 530,874

21

4. RISK FACTORS

The investment in the Shares involves a high degree of risk and presents the typical risk elements of an investment in

shares traded on an unregulated market.

In order to correctly appreciate the financial instruments contemplated in the Admission Document, the specific risk

factors regarding the Issuer, the companies of the Group, the business sector in which they operate and the admission to

trading of said financial instruments. The risk factors described in this Chapter 4 “Risk factors” must be read together

with the information provided in the Admission Document. The occurrence of the circumstances described in one of the

following risk factors may adversely impact the business and economic, financial and equity situation of the Company

and Group, their future perspectives and the price of the Shares, and Shareholders might loose everything or part of

their investment. These negative effects may also be caused to the Company, Group and Shares in case of events, not

known today, that may expose the Company to further risks or uncertainties, i.e. if risk factors not considered

significant today become significant due to any new circumstance.

When reference is made to a section or chapter, this always means section or chapter of the Admission Document.

4.1 RISK FACTORS REGARDING THE ISSUER

4.1.1 Risks associated with the dependence of the Group on certain key figures

The founder of the Group, Lapo Edovard Elkann, has been essential for the rapid success of the Italia Independent

brand in the eyewear, Lifestyle Products and communication markets, and is still significant for the implementation of

the Group’s communication strategy, thanks to his communication skills and influence as style icon. The success of the

Group also significantly stems from the other founders - Andrea Tessitore, Giovanni Accongiagioco and Alberto

Fusignani – whose consolidated professional expertise plays a prominent role in the development and management of

the Group’s business. Due to these reasons, while the operating and management profile of the Group is characterized

by a structure capable of ensuring continuity to business operations, the lack of the professional support of one or more

of these key figures could adversely impact the development of the business and the implementation of the growth

strategy of the Group. More specifically, should the Issuer not be capable of promptly replacing them with equally

qualified individuals capable of ensuring the same operating and professional contribution, the growth perspectives of

the Group, as well as its entire financial and equity situation, might be definitely adversely impacted.

For further information, see Part One, Chapter 6, Section 6.1.

4.1.2 Risks associated with the management of growth

Over the last few years, the activity of the Group has been characterized by a considerable and rapid development in

Italy and abroad. The Issuer intends to adopt a strategy aimed at continuing along this line of development and growth.

However, we cannot assure that the Group may achieve in the future the significant growth rates registered in the past.

Furthermore, the considerable growth in sales volumes together with the commercial strategies the Group is planning to

adopt to increase its penetration in the eyewear industry, particularly in international markets, will bring about increased

investments and uses of working capital. In such a context, the Group will have to structure its organizational model and

internal procedures to adjust its working capital management policies to increased requirements and meet requirements

by finding the adequate amount of financial resources to promptly and effectively fulfil the needs and demands

generated by high growth rates and international expansion. Should the Group fail to manage its investments and

working capital efficiently or fail to find adequate short-medium term forms of financing, particularly in the present

market phase characterized by credit crunch conditions that have reduced opportunities for support to

growing/developing companies, and manage the growth process and adjustment of the organizational model in an

efficient and appropriate manner for the increasingly complex management tasks of the period, the Group may not be

capable of maintaining its present competitive positioning, which could adversely impact the Group’s business

operations, future perspectives and economic and financial situation.

For further information, see Part One, Chapter 6, Section 6.1.

4.1.3 Risks associated with the implementation of strategies and future programs

Should the Group fail to effectively implement its strategy and development plans, or not succeeding in implementing

them within the times scheduled, or should any basic assumption of the strategy and development plans of the Group be

proved incorrect, the capacity of the Group to increase its revenues and profitability might be damaged and this could

negatively affect the business and growth perspectives of the Group, as well as its economic, financial and equity

situation.

The Group intends to pursue its growth and development strategy to increase and consolidate its competitive

positioning in the eyewear industry and succeed as international player, while simultaneously reinforcing the Italia

Independent brand in the Lifestyle Products and Communication sector. More specifically, as regards the expansion

22

strategy in international markets, the Group is planning to increase its penetration mainly in the key markets of the Euro

Area and in the United States of America. Within the framework of its development strategy, the Group is also planning

to open new single-brand concept stores called “Garage” in some selected locations, with the prevalent purpose of

reinforcing the brand image and its market positioning with flagship stores, in support of wholesale distribution.

After implementing its further international expansion strategy, the Group will be exposed to an increased management

complexity and to a number of risks associated with the general economic, social and political conditions of different

countries. This includes, inter alia, limitations to imports and exports, customs excises and restrictions to international

exchanges in general, exchange rate fluctuations, limits to foreign investments and exposure to different tax regimes,

legal and administrative systems. Furthermore, the opening of selected single-brand concept retail stores called

“Garage” implies increased fixed costs and the execution of new multi-year rental agreements or could require, in case

any store is shut-down, negative effects on the image of the brand.

For further information on the strategies and future programs of the Group, see Part One, Chapter 6, Section 6.1.5.

4.1.4 Risks associated with dependence on Suppliers

The Group will use selected third-party suppliers for the manufacturing of eyewear, sunglasses and reading glass frames

within the framework of a Group policy prevalently based, for efficiency-related reasons, on aggregate procurement

from a reduced number of suppliers. Although these third-party suppliers, located in Italy, are assessed and monitored

by the Group to comply with adequate service levels in terms of product quality and deliverables, outsourcing always

implies the existence of risks associated with the lack of a direct control of the manufacturing process by the Group and

the risk of terminating agreements with suppliers. The high growth rates achieved with the sale of products registered

by the Group in the eyewear industry also involve the risk for the Group not to promptly and efficiently fulfil product

requirements based on customer needs, particularly in case of demand of large quantities in concentrated time intervals

(the so-called order peaks), as suppliers may not be in the condition to rapidly adjust their manufacturing levels to the

increased demand. This would lead to delays in deliveries, violation of contractual terms and conditions and termination

of relationships, with the consequent negative effects on the image of the brand and the Group. For these reasons, we

cannot exclude that the Group may find itself in the situation of having to replace all or part of its suppliers or increase

their number, thus bearing higher expenses and procurement costs and difficulties in the maintenance of the Group’s

quality standard. Although the dies for the manufacturing of eyewear frames are the property of the Group and the

management maintains that this condition reduces the timing associated with possible supplier replacements, any

interruption or termination in existing agreements/business relationships with said suppliers without immediately

finding alternative solutions could adversely, albeit temporarily, impact the continuity of the business operations,

economic results and financial situation of the Group. Furthermore, suppliers may increase their prices to the Group and

the Group may not be in the condition to promptly replace said suppliers or wholly or partly transfer its increased costs

on distributors or end-consumers or customers. In addition to that, all the manufacturing sites of third-party suppliers

are subject to their own operating and regulatory risks or any other kind of risk and any interruption or slow-down in

manufacturing activities in these plants may negatively affect the economic results of the Group.

For further information, see Part One, Chapter 6, Section 6.1.3.

4.1.5 Risks associated with the sale of the Group's products through the wholesale channel

The distribution model adopted by the Group is prevalently based on the wholesale channel through agents that offer

retailers the opportunity to purchase the products directly from the Group and a network of distributors that purchase

the products from the Group to resell them to retailers. The wholesale channel also includes selected independent

optical shops with display cases dedicated to the marketing of Eyewear and Lifestyle Products selected based on the

Group’s projects conceived from time to time (so-called “shop-in-shop” format). More specifically, we point out that

the first three agents used by the Group in the Italian market have generated, in the year ended 31 December 2012, net

revenues for approximately €5.6 million, corresponding to about 46.8% of the net revenue of the “Eyewear and

Lifestyle Products” business line.

The Group is exposed to the risk of not being capable of maintaining its relationships with the present agents and

distributors and the present “shop-in-shop” business relationships or of developing new relationships or

replacing/changing any existing agreement in connection with the risk that distributors and agents may not be capable

of adequately managing relationships with retailers. Criticalities may also concern the geographical areas where

individual distributors and agents operate due to changes in the applicable legislation and the so-called “country risk”.

Should agreements with agents and distributors be terminated, the Group would be exposed to the risk of litigations

with the consequent damages due to claims for compensation and indemnification. Furthermore, we point out that shop-

in-shop agreements also contain the right to return Lifestyle Products, so Group is also subject to the risk of having

unsold products.

Although the Group has developed an effective system for the selection, management and control of agents, distributors

and opticians who run its shops-in-shop, the adoption by these entities of any marketing policy not compliant with the

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Group’s Guidelines might damage the image and brand reputation of Italia Independent and its trade relationships with

retailers, that are maintained by agents and distributors. This could adversely impact the present business and future

growth perspectives of the Group, as well as its economic, financial and equity situation.

For further information, see Part One, Chapter 6, Section 6.1.3.

4.1.6 Risks associated with the capacity to offer innovative products

Should the Group not be capable of identifying and seizing market opportunities for the development and launch of

products based on new treatments or innovative materials, or in the event that said new products are not as successful as

expected o require excessive investments both in economic and management terms, this might negatively affect the

business and future growth perspectives of the Group, as well as its economic, financial and equity situation. The

market segment of sunglasses and reading glass frames where the Group is prevalently positioned is particularly

affected by fashion trends and changes in customer taste. The Management believes that the capacity to develop and

launch innovative products on the market, including through new agreements for the use of materials, treatments and

innovative manufacturing processes, will continue to significantly determine the future success of the Group.

For further information on the products and business organizational model, see Part One, Chapter 6, sections 6.1.2 and

6.2.3.

4.1.7 Risks associated with the sale of the Group's products through the retail channel

The retail distribution model adopted by the Group includes single-brand franchised shops managed by third-parties,

which include a single-brand shop opened in May 2013 based on the new retail concept called “Garage” (for further

information, see Part One, Chapter 6, Section 6.1.3), two outlets and the company e-commerce website. The adoption of

marketing policies not consistent with the Group’s Guidelines by the managers of franchised single-brand shops may

damage the image and reputation of the Italia Independent brand, with the consequent adverse impact on the business

and future growth perspectives of the Group, as well as its economic, financial and equity situation. We also point out

that some franchising agreements of the Group include the right for affiliates to return the products distributed, which

causes the Group to be exposed to the risk of unsold products. Referring to the e-commerce channel, the Group is

exposed to the risk of not being capable of increasing traffic on its website, of depending on the customers’ propensity

to use the web for their purchases or witnessing changes in online commerce trends. Should the Group not be capable of

developing the aforesaid e-commerce activities, this would adversely impact the business and future growth

perspectives of the Group, as well as its economic, financial and equity situation.

For further information, see Part One, Chapter 6, Section 6.1.

4.1.8 Risks associated with trade receivable collection and access to credit (credit-related risk)

During 2012, the Group saw its trade receivable collection times increase, also due to the general worsening of

macroeconomic conditions, a situation that is particularly emphasized in the domestic market, where most of its

customers are located. Starting from the beginning of the current year, the Group made some changes to its marketing

policy and management and credit collection facilities with the objective of progressively reducing the average number

of collection days. Should the actions undertaken not allow the Group to achieve its objectives and if delays in customer

payment will continue, this may adversely impact the management of the working capital and consequently require the

Group to secure new bank loans or other similar source of financing. Furthermore, the failure to get refunding or the

non-availability of any credit line for the Group and, more generally, the lack of opportunities to obtain alternative

refunding sources would adversely impact the economic, financial and equity situation of the Group and/or slow down

its process of achieving the objectives set out in its business plan.

4.1.9 Risks associated with the branding and communication strategy

There is no certainty that the Group will be capable of continuing and pursuing a successful strategy of promotion of the

brand adopted to date, nor can we be sure that the aforesaid strategy allows the Group to achieve its objective of

disseminating the Italia Independent brand and attracting the attention of the media on its products. This could

consequently lead to the need to increase expenses and marketing and communication investments, with an adverse

impact on the economic, financial and equity situation of the Group.

The success of the Group is associated to the success of its brand-building policies in the eyewear, lifestyle and

communication industries thanks to the contribution of its founder, Lapo Edovard Elkann, and the Top Management,

with the support of an innovative promotion and branding strategy and the distribution of distinctive products. The

adoption of this strategy allowed the Group to minimize the resources to be used for the launch of the brand and its

subsequent development.

Furthermore, any behaviour or event which may damage the brand image, the Group and its products, whether of an

endogenous nature (e.g., the inability to convey the value of the distinctive features and philosophy of the Group in the

future), or of an exogenous nature (e.g. the dissemination by third parties of any information, including false statements,

24

on the Group, on its founder Lapo Edovard Elkann or on any other Group member), could adversely impact the

business and growth perspectives of the Group, as well as its economic, financial and equity situation.

For further information, see Part One, Chapter 6, Section 6.1.4.

4.1.10 Risks associated with the business of “Independent Ideas”

The communication agent of the Group, “Independent Ideas”, operates almost exclusively in Italy in a highly

competitive context characterized by a fierce competition with major communication agents provided with greater

resources. Should the Group’s communication agent not be capable of maintaining its competitive strength in the

market or loose any of its key professionals whose role is of paramount importance for the industry’s operators, such a

situation could adversely impact its business and growth perspectives.

We also point out that most of “Independent Ideas” revenues are generated by a limited number of customers, so we

cannot ensure that all the present customers of the agent will renew existing agreements or sign new ones. On the other

hand, Independent Ideas operates on the basis of agreements signed for individual communication campaigns or short-

term campaigns, generally not exceeding 3 years, which usually include a termination for convenience clause. This

translates into a risk for the Group that Independent Ideas’ customer portfolio may be reduced, including over a rather

short span of time. The loss of one or more of its main customers, if not offset by the signature of new agreements or by

an increased business with existing customers, may adversely impact the economic, financial results and equity of the

Group.

Finally, the communication agent’s business is particularly exposed to the effects of any unfavourable economic

conditions in the markets and sectors where it operates or where its customers are. For the year ended 31 December

2012, the revenues of the Subsidiary “Independent Ideas” were approximately € 3.3 million, almost exclusively

generated in Italy, for about 50% by customers of the fashion industry and for about 30% by customers of the

automotive industry, with an approximate 20% of customers from other sectors. The present and potential customers of

the Group may react to difficult economic conditions by reducing the costs of marketing and communication activities.

In addition to that, any critical situation suffered by customers may result in financial dire straits or insolvency or cause

delays in the payment of any fee due to the agent and request the use of resources to collect credit, with the consequent

adverse impact on the business and growth perspectives of the Group, as well as on its economic, financial and equity

situation.

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