Banca  Monte dei Paschi di Siena S.p.A. (MPS) is the fourth largest Italian  commercial and retail bank and the oldest bank in the world.

In  the last ten years MPS has committed a long series of serious  violations related to the disclosure of false information to the market  through financial statements and other official public documents. MPS  has carried out numerous complex structured financial transactions aimed  at altering its actual economic and financial situation to the  detriment of investors.

Between  2013 and 2018, Consob, the Italian financial authorities, sanctioned  MPS ten times for falsifying their 2008, 2009, 2010 and 2011 financial  statements and for the non-compliance of their consolidated 2014  financial statement and the non-compliance of their June 2015  semi-annual financial report.

Despite  four capital increases within a few years, MPS lost approximately  99.99% of its market value. Between 2016 and 2017, Consob suspended MPS  shares from trading for almost a year. After being readmitted to  trading, MPS lost more than 80% of its value in just over a year.

According  to Consob’s General Director, Dr. Angelo Apponi, ‘The recent history of  MPS represents a framework of fraudulent activities aimed at concealing  the actual economic and financial situation of the issuer, as well as  the negative outcomes of transactions carried out by the issuer’.

On  December 11th, 2020, in accordance with the statute of limitation  deadline for the Consob sanction no. 19459, Martingale Risk filed all  dispute letters on behalf of 11 global institutional investors and 120  retail clients for a total estimated cumulative claim of €270 million.

Martingale  Risk is now preparing an additional claim based on the October 15th,  2020 Milan first level penal trial, which convicted the former MPS CEO  Fabrizio Viola and former chairman Alessandro Profumo to six years and  former president of statutory auditors Paolo Salvadori to three and a  half years. The former CEO and Chairman were also given pecuniary fines  of € 2.5 million.

The  result of the penal trial has confirmed our pre-existing legal analysis  and financial opinion of the past booking actions of the Alexandria and  Santorini derivative instruments. The lawsuit will focus on MPS's  substantial adjustments on non-performing loans within their financial  documents from 2012-2016 and for the alleged administrative manipulation  and false corporate communication in financial statements between 2012  and the first half of 2015.

Our Proposal

Martingale  Risk proposes to file a collective lawsuit as well as individual suits  on the investors' behalf against Banca Monte dei Paschi di Siena S.p.A.,  which will be held at the Court of Siena.

The  lawsuit is directed at obtaining repayment of the damages incurred from  the investment losses between March 28th, 2013 to March 1st, 2018,  given the confirmation of false corporate communication and manipulation  in financial statements released to the market by the administrative  penal trial result.

We  work on a success fee basis, claiming our compensation as a percentage  of the recovered amount, only once the clients will have received their  repayment. Martingale Risk will fully finance the lawsuit and cover any  potential fees or adverse costs arising from the dispute.

Terms and Conditions

1.  Compensation: Martingale Risk will collect a Success Fee plus VAT  calculated on the Losses Recovered from MPS, as resulting from: (a) the  conclusion of a settlement agreement with MPS in the Negotiation or  Litigation phase; (b) the issuance of a definitive successful court  trial.

2.  Expenses: Martingale Risk will pay all administrative and tax expenses  incurred in the Litigation, such as: notification and registration  expenses for documents filed to the Court and any administrative  expenses and fees related to the experts eventually engaged by the  Court. Martingale Risk will be liable to pay the legal adverse costs in  case of an unsuccessful lawsuit.

3.  Representation: The Client will sign a mandate providing Martingale  Risk with Power of Attorney which includes the power to take every  decision concerning the lawsuit, including the power to settle, to  collect, and dispersed the recovered amount from MPS until the issuance  of a definitive decision. The Client will also sign a Power of Attorney  to the lawyer (s) directly involved in the litigation.

DISCLAIMER:  THESE TERMS ARE INDICATIVE AND NON-BINDING AND CAN BE SUBJECT TO  CHANGES PRIOR TO THE SIGNING OF THE MANDATE, GIVEN THE RESULTS OF THE  PRELIMINARY ANALYSIS AND PRELIMINARY LEGAL OPINION. MARTINGALE RISK WILL  RESERVE ALL THE RIGHTS TO DECLINE THE DEFENSE OF EACH CLIENT THAT IS  DEEMED UNSUITABLE TO THE LAWSUIT. ALL DISPUTES RELATED TO THE  INTERPRETATION OF THE MANDATE WILL BE REGULATED BY THE INTERNATIONAL  CHAMBER OF COMMERCE (ICC).