NEXI S.p.A.

REPORT ON CORPORATE GOVERNANCE AND OWNERSHIP STRUCTURE PURSUANT TO

ARTICLE 123-bis TUF (Italian Consolidated Law on Finance)

(TRADITIONAL MANAGEMENT AND CONTROL MODEL)

Financial year 2022

approved by Nexi S.p.A.’s Board of Directors on 6 March 2023

Available to the public on www.nexigroup.itand on the authorised storage mechanism “eMarket

STORAGE”

Date of publication April 4, 2023

CONTENTS

GLOSSARY

INTRODUCTION

1. 
   THE ISSUER’S PROFILE AND CORPORATE GOVERNANCE SYSTEM
2. 1. 
      PROFILE
   2. 
      CORPORATE GOVERNANCE SYSTEM
3. 
   INFORMATION ON OWNERSHIP STRUCTURE
4. 1. 
      SHARE CAPITAL STRUCTURE
   2. 
      RESTRICTIONS ON THE TRANSFER OF SECURITIES
   3. 
      MAJOR SHAREHOLDINGS
   4. 
      SECURITIES CONFERRING SPECIAL RIGHTS
   5. 
      SHARES HELD BY EMPLOYEES: MECHANISM FOR EXERCISING VOTING RIGHTS
   6. 
      RESTRICTIONS ON VOTING RIGHTS
   7. 
      SHAREHOLDERS’ AGREEMENTS (RELEVANT PURSUANT TO ARTICLE 122 TUF)
   8. 
      CHANGE-OF-CONTROLCLAUSE AND PROVISIONS IN THE ARTICLES OF ASSOCIATION ON TAKEOVERS
   9. DELEGATION OF POWERS TO INCREASE THE SHARE CAPITAL AND AUTHORISE THE PURCHASE OF TREASURY SHARES
   10. 
       MANAGEMENT AND COORDINATION ACTIVITIES
5. 
   COMPLIANCE
6. 
   BOARD OF DIRECTORS
7. 1. THE ROLE OF THE BOARD OF DIRECTORS
   2. 
      APPOINTMENT AND REPLACEMENT
   3. 
      COMPOSITION
   4. 
      FUNCTIONING OF THE BOARD OF DIRECTORS
   5. 
      THE ROLE OF THE CHAIR OF THE BOARD OF DIRECTORS
   6. 
      EXECUTIVE DIRECTORS
   7. 
      INDEPENDENT DIRECTORS AND LEAD INDEPENDENT DIRECTOR
8. CORPORATE INFORMATION MANAGEMENT
9. 
   BOARD OF DIRECTORS COMMITTEES
10. 
    SELF-ASSESSMENTAND SUCCESSION OF DIRECTORS – REMUNERATION AND APPOINTMENT COMMITTEE
11. 1. 
       SELF-ASSESSMENTAND SUCCESSION OF DIRECTORS

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1. 1. 
      REMUNERATION AND APPOINTMENT COMMITTEE
2. 
   DIRECTORS’ REMUNERATION
3. 
   INTERNAL CONTROL AND RISK MANAGEMENT SYSTEM – CONTROL, RISK AND SUSTAINABILITY COMMITTEE
4. 1. 
      CHIEF EXECUTIVE OFFICER
   2. 
      CONTROL, RISK AND SUSTAINABILITY COMMITTEE
   3. 
      HEAD OF INTERNAL AUDIT FUNCTION
   4. 
      ORGANISATIONAL MODEL (PURSUANT TO LEGISLATIVE DECREE NO. 231/2001)
   5. 
      INDEPENDENT AUDITORS
   6. 
      FINANCIAL REPORTING OFFICER AND OTHER CORPORATE ROLES AND FUNCTIONS
   7. 
      COORDINATION AMONG INTERNAL CONTROL AND RISK MANAGEMENT BODIES
5. 
   DIRECTORS’ INTERESTS AND RELATED-PARTY TRANSACTIONS
6. BOARD OF STATUTORY AUDITORS
7. 1. 
      APPOINTMENT AND REPLACEMENT
   2. 
      COMPOSITION AND FUNCTIONING
8. 
   RELATIONS WITH SHAREHOLDERS
9. 
   SHAREHOLDERS’ MEETINGS
10. 
    FURTHER CORPORATE GOVERNANCE PROCEDURES
11. 
    CHANGES SINCE THE END OF THE FINANCIAL YEAR
12. 
    COMMENTS ON THE LETTER FROM THE CHAIR OF THE CORPORATE GOVERNANCE COMMITTEE OF 25 JANUARY 2023

TABLE 1 – INFORMATION ON OWNERSHIP STRUCTURES AS AT 31/12/2022

TABLE 2 – STRUCTURE OF THE BOARD OF DIRECTORS AT THE END OF THE FINANCIAL YEAR

TABLE 3 – STRUCTURE OF THE BOARD COMMITTEES AT THE END OF THE FINANCIAL YEAR

TABLE 4 – STRUCTURE OF THE BOARD OF STATUTORY AUDITORS AT THE END OF THE FINANCIAL YEAR

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GLOSSARY

The main terms used in this Report and their definitions are listed below. Unless otherwise specified, the terms and definitions shall have the meanings set forth below. Other terms used in the Report have the meanings assigned to them in the text. Reference is made in full to the definitions of directors, executive directors, independent directors, significant shareholder, Chief Executive Officer (CEO), board of directors, control body, business plan, company with concentrated ownership, large company, sustainable success and top management referred to in the Code of Corporate Governance and the related Q&A.

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INTRODUCTION

This Report has been prepared pursuant to Article 123-bis TUF, on the basis of the template updated yearly and published by Borsa Italiana (IX edition – January 2022). In compliance with the provisions of the Corporate Governance Code, the Report contains information on the actions undertaken to implement the individual recommendations contained in the principles and application criteria of the Corporate Governance Code over the reporting period.

1. 
   THE ISSUER’S PROFILE AND CORPORATE GOVERNANCE SYSTEM

1. 
   PROFILE

Nexi’s history dates back to 1939, when six Italian banks set up a company (ICBPI – Central Institute of Italian Cooperative Banks) to create a single technological and services infrastructure supporting Italian cooperative banks.

In December 2015 with the entry in the shareholding of Mercury Italy Srl1, it started an extensive transformation process, which led to the establishment of Nexi as the banking sector’s paytech provider. Over time, the Company has gradually expanded its offer of products and services by organical developments and implementing synergistic takeovers (some of the main ones being CartaSì S.p.A., Bassilichi S.p.A. and Mercury Payment Services).

Nexi has been listed on Euronext Milan since 16 April 2019 and was included in the FTSE Mib index in June 2019.

During 2020, the Group completed the takeover of the merchant acquiring business unit of Intesa Sanpaolo S.p.A..

In 2021, the Nexi Group, continuing its steady growth path, completed (i) two important integration transactions through the Nets Merger, i.e. the cross-border merger by incorporation of Nets Topco 2 S.à r.l. into Nexi and the SIA Merger, i.e. the merger by incorporation of SIA S.p.A. into Nexi, described in greater detail below and (ii) the takeover of the book merchant acquiring business unit, formerly UBI Banca S.p.A., of Intesa Sanpaolo S.p.A..

The Nexi Group operates through the business lines briefly described below:

1. 
   Merchant Solutions

The Merchant Solutions Business Unit (“BU”) offers solutions and support to all types of counterparties, providing services and products for accepting digital payments, managing POS payment terminals, acquiring flows and customer care activities. Together with the Partner Banks, the BU focuses on the needs of merchants and support for their activities, supporting every type of business, from small-scale retail to large retail chains, for payments both in person and online.

The Group also provides administrative and customer relationship services via Help Line S.p.A..

The services provided by this BU comprise payment acceptance products and services and POS terminal management services.

• 
  The acquiring business consists of the range of products and services that enable merchants to accept payments through cards or other digital payment instruments belonging to credit or debit circuits (e.g. mobile payments).

1A SPV indirectly held by funds Advent International, Bain Capital and Clessidra.

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• 
  POS management services include the configuration, activation and maintenance of POS terminals, their integration with the merchants’ accounting software, fraud prevention services, dispute management and customer support services via a dedicated call centre.

Nexi operates under different service models, which vary depending on the partner banks, and therefore it covers a wide extent of the value chain. The activities carried out by the Group are managed internally and/or outsourced according to service model.

Thanks to the wide range of services offered, the various types of payment accepted, broad geographical coverage and value-added services, the Nexi Group constitutes a one-stop-shop for merchants from various European countries, thanks to its ability to provide merchants with omnichannel integrated solutions covering all needs.

In addition, a wide range of value-added services is offered to merchants, according to their size and needs throughout their business life cycle, including, among others, invoice and receipt management, consumer and merchant financing, and loyalty solutions.

1. 
   E-commerce

The e-commerce function monitors market trends, analyses and prioritises merchants’ needs by customer segment and defines the offer of e-commerce products and services to customers.

It is also responsible for planning the development and release of new products and services between the various regions, so as to create unique and modular solutions with the aim of expanding the opportunities and distribution channels for e-commerce services.

1. 
   Issuing Solutions

Via this BU, the Group and its partner banks provide a wide range of issuing services, i.e. services relating to the supply, issue and management of private and corporate payment cards, with advanced fraud prevention systems ensuring fast, reliable and secure customer authentication and payments. In addition, the Group provides administrative services such as payment tracking and the production of monthly statements, data analysis and pricing support services, customer support and dispute management services, as well as communication and customer development services through promotional campaigns and loyalty programmes.

The Issuing Solutions BU provides services for the issue of payment cards almost exclusively through partner banks (cards issued in partnership with banks). Working with the partner banks, the BU also provides go-to- market and Customer Value Management services, continuing the mission of promoting, incentivising and educating customers on the use of digital payments.

1. 
   Digital Banking Solutions

With this business line, the Group provides three types of service: ATM Management, Clearing and Digital Corporate Banking. To cover this range of services, the Digital Banking Solutions BU relies on dedicated professionals (in different roles, such as marketing, sales, ICT and operations) and three internal Digital Factories dedicated to developing application solutions.

The Group is responsible for installing and managing ATMs on behalf of partner banks. Of the ATMs managed, more than one third are “cash-in” machines, i.e. allowing both cash withdrawals and cash deposits. The service can be on a full-fleet basis, i.e. with full management of the ATM machines, or include only part of the services (outsourcing basis).

On the Italian market, the Group also operates as an Automated Clearing House (ACH) for domestic and international payments pursuant to standard interbank regimes. Through a dedicated platform, the Group allows participating banks to exchange flows containing collection and payment instructions, and to calculate

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bilateral and multilateral balances to be settled at a later date. Recently, the Group opened the “ACH Instant Payments” service, for the management of instant transfers, which differs from traditional clearing services in terms of speed of execution and 24/7 availability.

The Group provides its partner banks’ corporate customers with digital banking services for the management of current accounts and payments.

For the Scandinavian market, this business unit also provides e-Security and digitisation services. These include the provision of e-Security solutions through MitID (Denmark), digitisation services enabling customers to simplify workflows and services to support the digital transformation.

**

Below is a summary of the main events that led to the Group’s current composition and which are also relevant for the purposes of the shareholder agreements in force at the date of this Report.

1. The Nets Merger

On 1 July 2021, the cross-border merger by incorporation of Nets Topco 2 S.à r.l. (“Nets”) into Nexi (the “Nets Merger”) was finalised. As a result of this merger, the Nexi Group, which was already one of the main paytech players in Italy, has also gained a strong presence in some foreign markets, through the former Nets Group companies (which, as a result of the Nets Merger, have become part of the Nexi Group), opening up the prospect for Nexi of becoming one of the leading paytech companies in Europe as well.

In terms of competitive positioning, the Nexi Group, through the companies belonging to the Nets Scope, is one of the leading electronic money service providers, including card issuing and merchant acquiring, in many EEA countries, including Croatia, Denmark, Estonia, Finland, Germany, Norway, Poland, Slovenia and Sweden. Therefore, through the Nets Merger, the Nexi Group has achieved greater presence in regions where the paytech sector is highly advanced or growing rapidly (i.e. Italy, the DACH and EEC/EEA regions and Poland).

2. The SIA Merger and the Push-Down

On 16 December 2021, once all the conditions precedent had been met, the deed of merger by incorporation of SIA S.p.A. (“SIA”) into Nexi (the “SIA Merger”) was executed. The transaction was governed by the agreement signed on 11 February 2021 between Nexi, SIA, CDP Equity, CDPEI (formerly FSIA Investimenti) and Mercury UK, subsequently amended. The SIA Merger, completed at 23:59 on 31 December 2021, will desirably enable Nexi to consolidate its position as an industry leader at European level: the new Group enjoys unique positioning to develop new partnership agreements with the main market players.

The SIA Scope includes companies engaged in the design, implementation and management of technological infrastructure and services for financial institutions, banks, companies and public authorities. In addition to Italy, SIA operates in approximately 50 countries (through companies in Austria, the Czech Republic, Croatia, Greece, Romania, Serbia, Slovakia and South Africa; through branches in Belgium, Germany, Hungary, the Netherlands and South Africa; and through offices in the United Kingdom and Poland).

In particular, the SIA Merger transaction included a push-down reorganisation (the “Push-Down”) whereby Nexi Payments would receive the assets, liabilities and contractual relationships of SIA, including Sia’s holding in SIApay Srl and in the foreign branches located in Belgium, the Netherlands, Germany and South Africa, on the understanding that the following could not be transferred: (x) SIA’s financial debt, transferred to Nexi through the Merger, (y) certain specific non-regulated activities (e.g., Help Desk & Customer Operations and Card Factory services, as well as part of the above-mentioned branches and any other branch belonging to the SIA group carrying out such activities) which would be transferred to a newly incorporated

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Nexi subsidiary, as well as (z) the holdings in SIA’s foreign subsidiaries which, following the Merger, would be held by Nexi.

In this regard it is specified that, without prejudice to items not included in the transfer, the following were transferred as part of the Push-Down:

1. 
   to Nexi Payments, the business unit consisting of all tangible and intangible assets functionally organised by SIA to perform its activity and comprising the assets, liabilities and contractual relationships originally held by SIA, including SIA’s holding in SIApay Srl, ATS S.p.A. and the foreign branches located in Belgium, the Netherlands and South Africa, as well as part of the assets relating to the branch located in Germany, as described in detail in the transfer deed; and
2. 
   to Service Hub, a company established ad hoc, the business unit consisting of all the tangible and intangible assets functionally organised by SIA to perform its non-regulated activities, i.e. Help Desk & Customer Operations and Card Factory services, as well as the branch located in Romania and part of the assets relating to Customer Operations of the branch located in Germany, including the respective personnel, as detailed in the transfer deed.

The Push-Down became effective, after the SIA Merger effective date (23:59 on 31 December 2021), at 00:01 on 1 January 2022.

In terms of competitive positioning, the Nexi Group, through the SIA Scope, is one of the leading providers of e-money services (both card issuing and merchant side) in many EEA countries, including Italy, Austria, Belgium, Greece, Czech Republic, Slovakia and Hungary. The SIA Merger, in turn, allowed Nexi, on the one hand, to consolidate the presence of the Group in foreign markets. Therefore, it enabled Nexi to expand and diversify its customer base to an even greater extent than that already achieved through the Nets Merger.

The completion of this transaction, together with the already completed merger with Nets, has allowed the Nexi group to achieve its goal of creating the leading Italian paytech company in Europe, by creating a new technology and digital innovation hub that will guarantee a portfolio of best-in-class solutions, technologies and expertise in all digital payment areas, in Italy and Europe.

* *

The Board of Directors leads the Company by pursuing its sustainable success. For an outline of the initiatives implemented by the Board to this end, please refer to the Sections in this Report describing: (i) how this objective is embedded into the strategies (Section 4.1), the remuneration policies (Section 8) and the internal control and risk management system (Section 9); and (ii) the corporate governance measures specifically adopted in this regard (Section 9.2 (Control and Risk Committee)).

The Issuer:

• 
  does not qualify as an “SME” within the meaning of Article 1(1)(w-quater.1) TUF; and
• is a “large company” and a “company with concentrated ownership” within the meaning of the Corporate Governance Code.

Company mission and Consolidated Non-Financial Statement

Nexi’s mission is to make it easier and more intuitive for all customers to manage digital payments and related services, offering a complete and customisable offer of easy, intuitive and secure solutions. Accordingly, the Group offers banks, small and medium-sized enterprises, large corporations, institutions and public administrations a complete range of highly innovative solutions for digital payments in both card-present and card-not-present acceptance, e-commerce,multi-channel solutions and specific product sectors. Our ambition is to shape the way people pay and businesses accept payments, by offering the Group’s customers the most

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