The SME Initiative ItalyDate: 11 February 2020

Information note to the Financial Intermediaries regarding the Call for Expression of Interest of SMEI Italy (“Call”) to implement the SME Initiative Italy Securitisation Instrument launched on 21 October 2016Additional funds to be allocated and changes in transactions terms

The European Investment Fund (“EIF”) intends to allocate additional resources to the above-mentioned Call.In the context of the intended increased allocation, certain elements and indicative transaction terms set out in the original Call are now amended as follows:

Call for Expression of Interest

1. Background and resources available

The two last paragraphs of the Section are to be amendedas follows:In such context, a Single Dedicated National Programme (“SDNP”) has been approved by the European Commission on 30/11/2015 with the objective of launching the SME Initiative in the “Mezzogiorno” 1 of Italy being the area covering the regions of Basilicata, Calabria, Campania, Puglia, Sicilia, Abruzzo, Molise and Sardegna (“Target Geography”). After the allocation of additional funds, the resources made available by the Republic of Italy to the SME Initiative, totalled EUR 422,500,000 of which (i) EUR 322,500,000 under the SME Initiative Dedicated National Programme (“SDNP Contribution”) as amended with the EC Decision C(2018)9116 on 19/12/2018 and (ii) EUR 100,000,000 of additional funds under the Fondo di Sviluppo e Coesione approved by the Comitato Interministeriale per la Programmazione Economica (CIPE) with resolution n. 52, on 01/12/2016, pursuant to art. 1, par. 703, lett. c) of law 23 December 2014, n. 190 (“National Contribution”

1 In accordance with the SDNP, the Mezzogiorno area includes 8 southern regions classified for the purpose of the structural funds regulation as “less developed” Regions (Basilicata, Calabria, Campania, Puglia and Sicilia) and Regions “in transition” (Abruzzo, Molise and Sardegna).

and, together with the SDNP Contribution, the ”MS Contribution”). Additional COSME resources will be made available to the SME Initiative Italy, in an amount not exceeding 2.1% of the MS Contribution and EIB Group resources and which may vary on a specific deal by deal basis in accordance with the relevant application to be submitted to this Call, as soon as the Intercreditor Agreement between the MS, the EIB, the EIF, and the EC is signed.

2. SME Initiative Securitisation Instrument

The last two paragraph of the relevant Section are to be amended as follows:EIF can enter into SMEI Transactions up to 31 December 2020 (the end of the “Implementation Period”). However, the end of the Implementation Period may be extended and, should this be the case, a notice will be duly published on EIF’s website.The terms of the Additional Portfolio Agreements shall be in English and will be governed by the laws of Luxembourg (unless otherwise agreed by the EIF in its absolute discretion).

3. Eligible Financial Intermediaries

The third and fourth Paragraph of the relevant Section are to be amended as follows:Financial Intermediaries shall acknowledge the EIF Anti-Fraud Policy which sets out the policy of EIF for preventing and deterring corruption, fraud, collusion, coercion, obstruction, money laundering and terrorist financing (please refer to EIF website)2 as amended from time to time, and shall take appropriate measures (as may be further specified in the Guarantee Agreements) to (i) facilitate implementation of such policy as well as to (ii) undertake to support investigations performed by the EIF or the European Investment Bank acting on behalf of the EIF, or the European Anti-Fraud Office (OLAF), or the European Public Prosecutor's Office (EPPO), or Court of Auditors (ECA), or any other relevant EU institution or body in connection with actual or suspected prohibited conduct.Financial Intermediaries including the managers thereof shall comply with relevant standards and applicable legislation on the prevention of money laundering, the fight against terrorism and tax fraud to which they may be subject and shall not be established and shall not maintain business relations with entities incorporated in any Non-Compliant Jurisdiction, as further provided in the Investment Guidelines.

4. The application procedure

A new paragraph shall be added under the penultimate paragraph of the relevant sub-Section:Any personal data provided by the Applicants shall be processed by EIF in compliance with its Data Protection Statement (EIF statement on the processing operations of Applicants and Financial Intermediaries’ personal data, as published on the EIF‘s website) and the Regulation (EU) 2018/1725 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices

2 http://www.eif.org/attachments/publications/about/Anti_Fraud_Policy.pdf

and agencies and on the free movement of such data, as amended from time to time.(http://www.eif.org/attachments/eif_data_protection_statement_financial_intermediaries_due_diligence_en.pdf)

5. Submission of Expressions of Interest

The second Paragraph of the relevant Section is to be amended as follows:The deadline is 31 October 2020.

6. Selection procedure

The last paragraph of the relevant Section is to be amended as follows:Those Applicants, whose Expression of Interest is rejected, shall have the right to submit a written complaint about the selection process by e-mail, registered mail or professional courier service, to the same address used for the submission of the Expressions of Interest above, within the timeline provisioned within the relevant EIB Group complaints policy. Any complaints will be dealt within the framework and in accordance with the EIB Group complaints policy (for further information visit http://www.eib.org/about/publications/complaints-mechanism-policy.htm

6.1.2 Quality assessment

The paragraph “Note on the criterion set out in item (g) Target Geography above” is to be amended as follows:For the purpose of the criterion set out in item (g) (Target Geography), the EIF will assign (a) a top scoring in relation to Existing Portfolios with an exposure in the Target Geography higher than 65% of the initial principal amount of such Existing Portfolios, (b) an intermediate scoring in relation to Existing Portfolios with an exposure in the Target Geography between 50% and 65% of the initial principal amount of such Existing Portfolios, (c) the worst scoring in relation to Existing Portfolios with an exposure in the Target Geography below 50%.

6.2 Due-diligence

A new paragraph shall be added under the relevant sub-Section before point 6.2.1:

Know Your Customer (“KYC”) documents to be included in the Expression of Interest are specified in Appendix 4 of Annex 1 to the

Expression of Interest. EIF reserves the right to request further KYC documents from pre-selected applicants.

7. Publishing of Information on Financial Intermediaries and SMEs

A new sub-Section shall be added under the last paragraph of the relevant Section:EIF Transparency PolicyWithin the framework of the EIF’s Transparency Policy3 (the “EIF Transparency Policy"), EIF is committed to the guiding principle of promoting transparency with respect to its operational and institutional activities. Pursuant to this guiding principle, and in accordance with the EIB Group approach and undertakings to promote transparency and good administrative practice, EIF has adopted the practice of publishing the minutes of the Board of Directors ("Board minutes") on its website, following their approval and signature.The published Board minutes only indicate those operations presented for decision which have been approved and, as a general rule, contain a summary indicating the project name, the nature of the operation, the geographical focus and the relevant EIF-managed resources.The EIF Transparency Policy also recognizes the need for EIF to balance transparency with confidentiality undertakings and the protection of commercially sensitive or personal data, with a view to EIF satisfying its legal obligations to, and maintaining the confidence and trust of, its business partners, investors and third parties. Consequently, should an Application receive the relevant EIF internal authorisation for submission to EIF's Board of Directors and be approved by the Board thereafter, and should an Applicant deem that the publication of such a summary would expose sensitive or confidential information, for which there would be a compelling reason not to disclose, the Applicant shall make a declaration to that effect in the submission of the Expression of Interest resulting in the information in question being edited out of the published Board minutes and, subject to any applicable confidentiality undertakings, only being made public in connection with the signature of the operation in question.If EIF has not received such declaration confirming that an Applicant does not agree to the publication of the aforementioned operational overview in the Board minutes, EIF will consider that it is acceptable to the Applicant and each Participating Entity, if applicable, and will proceed with publication on EIF's website as indicated above.

3 https://www.eif.org/news_centre/publications/EIF_Transparency_policy.htm?lang=-en

8. Definitions and Interpretation

The following definitions shall be amended under the relevant Section:

Deadline Means 31/10/2020 or such different date as announced officially in the Facility section of EIF’s website

Disbursement End Date

Has the meaning set forth in the relevant Additional Portfolio Agreement provided that such date cannot be later than 31 December 2023 (or any other date as set-up by the Investors Board within the limit of the relevant regulation).

Financial Intermediary

Means either: (a) Financial or credit institution (including

banking groups) duly authorised to carry out lending or leasing activities according to the applicable legislation.

(b) Guarantee schemes, guarantee institutions or other financial or credit institutions duly authorized to issue guarantees according to the applicable legislation, established and/or operating in the Republic of Italy.

Such institution shall comply with relevant standards and applicable legislation on the prevention of money laundering, the fight against terrorism and tax fraud (including the EIF Anti-Fraud Policy) to which it may subject, and shall not be established in a Non-Compliant Jurisdiction, unless in case of NCJ Implementation.The Financial Intermediaries shall not be selected if they fall within at least one of items listed in the exclusion criteria shown in Appendix C (Exclusion Criteria for Financial Intermediaries) of Annex II to the Call.

The definition of Non-Cooperating Jurisdiction shall be replaced by the following under the relevant Section:

Non-Compliant Jurisdiction - NCJ

Means a jurisdiction (i) listed in the Annex I of the European Council conclusions on the revised EU list of non-cooperative jurisdictions for tax purposes, adopted by the European Council at its meeting held on 12 March 2019, and/or (ii) listed in the Annex of the

Commission Delegated Regulation (EU) 2016/1675 of 14 July 2016 supplementing Directive (EU) 2015/849 of the European Parliament and of the Council by identifying high-risk third countries with strategic deficiencies, and/or (iii) rated as “partially compliant”, “provisionally partially compliant” or “non-compliant” by the Organisation for Economic Cooperation and Development and its Global Forum on Transparency and Exchange of Information for Tax Purposes and/or (iv) included in the Financial Action Task Force “Public Statement” (i.e. countries or jurisdictions with such serious strategic deficiencies that the Financial Action Task Force calls on its members and non-members to apply counter-measures or for which the Financial Action Task Force calls on its members and non-members to apply counter-measures or for which the Financial Action Task Force calls on its members to apply enhanced due diligence measures), and/or (v) included in the Financial Action Task Force statement “Improving Global AML/CFT Compliance: On-Going process”(i.e. countries or jurisdictions with strategic weaknesses in their AML/CFT measures but that have provided a high-level commitment to an action plan developed with the Financial Action Task Force), in each case as such statement, list, directive or annex may be amended and/or supplemented from time to time.

The following defintions shall be added under the relevant Section:

Anti-Fraud Policy Means the policy of EIF for preventing and deterring corruption, fraud, collusion, coercion, obstruction, money laundering and terrorist financing, as published on EIF’s website on the Effective Date and sent to the Intermediary on or after the Effective Date.

Data Protection Regulation

Means:(a)Regulation (EU) N° 2018/1725 of the

European Parliament and of the Council, dated 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data (OJ L

295, 21.11.2018, p.39-98); (b)Regulation (EU) N° 2016/679 of the

European Parliament and of the Council dated 27 April 2016 relating to the protection of natural persons with regard to the processing of personal data and on the free movement of such data (“GDPR”); and/or

(c) all applicable laws and regulations relating to the processing of Personal Data, including national legislation implementing the Data Protection Directive (Directive 95/46/EC) and the Directive on Privacy and Electronic Communications (Directive 2002/58/EC), and any other laws and regulations implementing, derogating from or made under them, and any orders and codes of practice, guidelines and recommendations issued by the applicable Regulatory Authorities,

in each case as amended, restated, supplemented or substituted from time to time.

NCJ Implementation

Means that the Final Recipient is established and operating in the country of establishment of the Financial Intermediary and that there is no indication that the relevant Final Recipient Transaction supports actions that contribute to (i) criminal activities such as money laundering, financing of terrorism, tax crimes (i.e. tax fraud and tax evasion) and (ii) artificial arrangements aimed at tax avoidance..

OLAF Means the European Anti-Fraud Office, set up in accordance with the provisions of the Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No

1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999.

Annex II – Indicative SMEI Transactions Term Sheet

1.Overview

The penultimate paragraph of the relevant Section is to be amended as follows:As certain tranches within the SMEI Transactions will be priced below market price, the Financial Intermediaries shall pass on the benefit stemming from the SMEI Transactions to the SMEs financed via the Additional Portfolio by reducing, for each exposures included in it, the standard credit risk premium normally charged (either via interest spread or guarantee fee) by an amount equal to the Eligible Final Recipient Transaction Benefit, provided that the Total Benefit of the relevant SMEI Transaction has been transferred at total Additional Portfolio level.

2. The SMEI Transactions - Indicative General Terms and Conditions

The following definition shall be amended as follows under the relevant Section:

Financial Intermediary

Means either (a) a financial or credit institution (including banking groups) duly authorised to carry out lending or leasing activities according to the applicable legislation in the Republic of Italy or (b) guarantee schemes, guarantee institutions or other financial or credit institutions duly authorized to issue guarantees according to the applicable legislation, established and/or operating in the Republic of Italy. Such institution shall comply with relevant standards and applicable legislation on the prevention of money laundering, the fight against terrorism and tax fraud (including the EIF Anti-Fraud Policy) to which it may subject, and shall not be established in a Non-Compliant Jurisdiction, unless in case of NCJ Implementation.The Financial Intermediaries shall not be selected if they fall within at least one of items listed in the exclusion criteria shown in Appendix C (Exclusion Criteria for Financial Intermediaries).

4. The The definition Existing Portfolio maximum size shall be deleted under

SMEI Transactionss – Existing portfolio

the relevant Section.Point (ii) of the Eligibility Criteria of the Existing Portfolio under the relevant Section, related to geographic concentration in the Target Geography shall be deleted.

5.The SMEI Transactions Miscellaneous

The following definition shall be amended as follows under the relevant Section:

Governing Law and Language

The terms of the Guarantee Agreement or the Notes Purchase Agreement shall be in the English language and the Guarantee Agreement or the Notes Purchase Agreement shall be governed by the laws of Luxembourg (unless otherwise agreed by the EIF in its absolute discretion).

6. The Additional Portfolio

The following definition shall be amended as follows under the relevant Section:

Disbursement End Date

Has the meaning set forth in the relevant Additional Portfolio Agreement provided that such date cannot be later than 31 December 2023 (or any other date as set-up by the Investors Board within the limit of the relevant regulation).

7. The additional Portfolio – Transfer of Benefit and de minimis

The following definition shall be amended as follows under the relevant Section:

Total Benefit The amount of benefit provided to the Financial Intermediary in respect of each tranche of the SMEI Transaction supported by the Facility shall be transferred to the Final Recipients by reducing the standard premium normally charged by the Eligible Final Recipient Transaction Benefit (either via interest spread or guarantee fee). The Total Benefit is an amount equal to the sum of each Tranche Benefit.

9. The Additional Portfolio - Miscellane

The definition of Non-Cooperating Jurisdiction shall be replaced by the following under the relevant Section:

Non-Compliant Means a jurisdiction (i) listed in the Annex I of

ous Jurisdiction the European Council conclusions on the revised EU list of non-cooperative jurisdictions for tax purposes, adopted by the European Council at its meeting held on 12 March 2019, and/or (ii) listed in the Annex of the Commission Delegated Regulation (EU) 2016/1675 of 14 July 2016 supplementing Directive (EU) 2015/849 of the European Parliament and of the Council by identifying high-risk third countries with strategic deficiencies, and/or (iii) rated as “partially compliant”, “provisionally partially compliant” or “non-compliant” by the Organisation for Economic Cooperation and Development and its Global Forum on Transparency and Exchange of Information for Tax Purposes and/or (iv) included in the Financial Action Task Force “Public Statement” (i.e. countries or jurisdictions with such serious strategic deficiencies that the Financial Action Task Force calls on its members and non-members to apply counter-measures or for which the Financial Action Task Force calls on its members and non-members to apply counter-measures or for which the Financial Action Task Force calls on its members to apply enhanced due diligence measures), and/or (v) included in the Financial Action Task Force statement “Improving Global AML/CFT Compliance: On-Going process”(i.e. countries or jurisdictions with strategic weaknesses in their AML/CFT measures but that have provided a high-level commitment to an action plan developed with the Financial Action Task Force), in each case as such statement, list, directive or annex may be amended and/or supplemented from time to time.

The following definition shall be added under the relevant Section:

NCJ Implementation

Means that the Final Recipient is established and operating in the country of establishment of the Financial Intermediary and that there is no indication that the relevant Final Recipient

Transaction supports actions that contribute to (i) criminal activities such as money laundering, financing of terrorism, tax crimes (i.e. tax fraud and tax evasion) and (ii) artificial arrangements aimed at tax avoidance..

Annex II – Indicative Securitisation Instrument Term Sheet - Appendix A (Additional Portfolio Eligibility Criteria)

Final Recipient Eligibility Criteria

The following Final Recipient Eligibility Criteria shall be added under the relevant Section:(v) The Final Recipient shall not be established in a Non-Compliant Jurisdiction, unless in case of NCJ Implementation.

Final Recipient Transaction Eligibility Criteria

The following Final Recipient Transaction Eligibility Criteria shall be amended under the relevant Section:(xvi) The customary interest spread or guarantee fee applicable to the Eligible Final Recipient Transaction included in the Portfolio shall be reduced by the level of the Final Recipient State Aid Benefit.

Annex II – Indicative Securitisation Instrument Term Sheet - Appendix B (Restricted Sectors and Exclusion Situations)

1. Restricted Sectors

Paragraph (1) (Restricted Sectors) shall be amended as follows:1. Illegal Economic ActivitiesAny production, trade or other activity, which is illegal under the laws or regulations of the home jurisdiction for such production, trade or activity (“Illegal Economic Activity”).Human cloning for reproduction purposes is considered an Illegal Economic Activity.2. Tobacco and Distilled Alcoholic BeveragesThe production of and trade in tobacco and distilled alcoholic beverages and related products.3. Production of and Trade in Weapons and AmmunitionThe financing of the production of and trade in weapons and ammunition of any kind. This restriction does not apply to the extent such activities are part of or accessory to explicit European Union policies.4. CasinosCasinos and equivalent enterprises.5. IT Sector RestrictionsResearch, development or technical applications relating to electronic data programs or solutions, which:

(a) aim specifically at:(i) supporting any activity included in the EIF Restricted Sectors

referred to under 1. to 4. (inclusive) above;(ii) internet gambling and online casinos; or(iii) pornography, or which:

(b) are intended to enable to illegally:(i) enter into electronic data networks; or(ii) download electronic data.

6. Life Science Sector RestrictionsWhen providing support to the financing of the research, development or technical applications relating to (a) human cloning for research or therapeutic purposes; and(b) Genetically Modified Organisms (“GMOs”), EIF will require from the EIF counterpart appropriate specific assurance on the control of legal, regulatory and ethical issues linked to such human cloning for research or therapeutic purposes and/or GMOs.

Annex II – Indicative Securitisation Instrument Term Sheet - Appendix E (Indicative Reporting Template Additional Portfolio)

Indicative Reporting Template Additional Portfolio

The reporting template shall be replaced by the following file:

Annex IV –Terms of confidentiality

1. Confidentiality Undertaking

Letter (a) of this Paragraph shall be amended as follows:(a) take reasonable steps to keep the Confidential Information confidential and not disclose it to anyone except as provided for by paragraph 2 below and ensure that such Confidential Information is protected with security measures and a degree of care that would apply to its own confidential information;

Letter (c) of this Paragraph shall be amended as follows:use all reasonable endeavours to ensure that any person to whom EIF passes any Confidential Information (unless disclosed under paragraphs 2(b), (c), (d) or (f) below) complies with the provisions of these Terms of Confidentiality as if that person were subject to these Terms of Confidentiality.

2. Permitted disclosure

The entire Paragraph shall be amended as follows:EIF may, however, disclose Confidential Information: a) to its managing bodies, affiliates, officers, directors, employees,

representatives, professional advisers, and service providers, to the extent necessary for, or in connection with, the Permitted Purpose and/or to its auditors;

b) to the Investment Board members and observers and to the managing authority in charge of the SDNP, to the extent necessary for, or in connection with, the Permitted Purpose and/or to their auditors;

c) to the European Commission, the European Court of Auditors, the European Anti-Fraud Office (OLAF), the European Investment Bank, and/or to any other authority to whom disclosure is required under any applicable laws or regulations and to their respective affiliates, officers, directors, employees and professional advisers to the extent necessary for, or in connection with, the Permitted Purpose, and to their respective auditors;

d) to the European Investment Bank and to its respective affiliates, officers, directors, employees and professional advisers, to the extent that any such Confidential Information is relevant in the context of any current or future know-your-customer controls, verifications or activities under the EIB Group AML-CFT Framework4, whether or not related to the Proposed Transaction;

e) where requested or required by any court of competent jurisdiction or any competent judicial, governmental, supervisory or regulatory body or administrative order, (ii) where required by its statutory documents, internal policies and procedures or in accordance with the relevant treaties or (iii) where required by the laws or regulations of any country with jurisdiction over its affairs (iv) where required in connection with and for the purposes of any litigation, arbitration, administrative or other investigations, proceedings or disputes or in order to protect its interests in the course of any legal or arbitration proceedings;

f) with the Financial Intermediaries prior written consent, not to be unreasonably withheld;

g) within the framework of the EIF’s Transparency Policy5 pursuant to which EIF may publish on its website the minutes of its Board of Directors (including a summary indicating the project name, the nature of the operation, the geographical focus and the relevant EIF-managed resources of the Proposed Transaction), unless the Financial Intermediaries have specifically objected to

4 “EIB Group AML-CFT Framework” means the European Investment Bank group’s anti-money laundering and combating financing of terrorism framework, as published on the following website and as may be amended or superseded from time to time: https://www.eib.org/en/publications/eib-group-anti-money-laundering-policy-and-combating-finance-of-terrorism-framework.5 http://www.eif.org/news_centre/publications/EIF_Transparency_policy.htm?lang=-en

such disclosure as set out in the Call.

3. Notification of Required or Unauthorised Disclosure

The entire Paragraph shall be amended as follows:EIF will (to the extent permitted by law and by its statutory documents) inform the Financial Intermediaries of the full circumstances of any disclosure under paragraph 2(d).

5. Definitions

The entire Paragraph shall be amended as follows:“Confidential Information” means any information in written or other permanent form marked by the Financial Intermediary (in good faith) as confidential relating to the Financial Intermediary and the Proposed Transaction, provided to EIF by a Financial Intermediary or any of its affiliates or advisers, and includes any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes information that (a) is or becomes public knowledge (other than as a result of any breach of the Terms of Confidentiality) or (b) is not marked as confidential by such Financial Intermediary or (c) is known by EIF before the date the information is disclosed to EIF by such Financial Intermediary or any of its affiliates or advisers or (d) is lawfully obtained by EIF, other than from a source which is connected with such Financial Intermediary and which, in either case, as far as EIF is aware, has not been obtained in violation of, and is not otherwise subject to, any obligation of confidentiality; “Permitted Purpose” means (a) considering and assessing whether or not to enter into the Proposed Transaction or another transaction with the same Financial Intermediary, (b) any related legal or regulatory or rating review and/or related reporting obligations, and/or (c) any internal procedure of EIF or the European Investment Bank, including but not limited to, any current or future know-your-customer controls, verifications or activities under the EIB Group AML-CFT Framework (regardless of whether or not such procedures are related to the Proposed Transaction); and“Proposed Transaction” means a SMEI Transaction (as defined in the Call documentation) between the EIF and the Financial Intermediary.

6. Governing law and jurisdiction

The entire Paragraph shall be amended as follows:The Terms of Confidentiality, and any non-contractual obligations arising out of or in connection with them, shall be governed by, and construed in accordance with, the laws of Luxembourg. Any disputes arising out of or in connection with the Terms of Confidentiality will be subject to the jurisdiction of the courts of Luxembourg.

For any other financial institution interested in submitting an Expression of Interest to the Call, please visit http://www.eif.org/what_we_do/guarantees/sme_initiative/smei_italy/index.htm