THE GROUP AT A GLANCE The BasicNet Group operates in the apparel, footwear and accessories sector through the brands ®, Robe di Kappa®, K-Way®, Superga®, Briko®, Jesus® Jeans, Sabelt® and, since July 2017, Sebago®. Group activities involve driving brand enhancement and product distribution through a global network of licensees. This business network is defined as the “Network”. And from which the name BasicNet derives. The Network of licensees encompasses all key markets worldwide. BasicNet S.p.A. is the parent company of the Group – with headquarters in - listed the Italian Stock Exchange.

STRENGTHS The strengths of the Group are founded on the strategic priorities since its inception which encompass: 1. Brand positioning 2. The Business System 3. Web Integration

1. Brand positioning The Basic Group brands form part of the informal and casual sector, which has experienced significant growth since the 1960’s and continues to develop with the “liberalization” of clothing trends.

is a practical brand, serving active and fast-paced individuals, who in their sporting activity require highly-functional clothing, while displaying a youthful, colorful and original . The Kappa® collections include also footwear and accessories for sport, designed to ensure peak performance. The Kappa® brand sponsors major clubs globally across a wide range of sports, in addition to many national sporting federations, particularly in .

is the brand for those who in their free-time and informal professional activity seek to wear modern, high-quality sportswear at accessible prices. The brand serves energetic, modern individuals, open to an ever-changing world.

is the leisure footwear and accessories brand, designed for those seeking comfort, while demanding a fashionable, colorful and stylish look and high quality. The Superga® collections serve the needs of a wide cross-section of customers, within every age category.

exceptional waterproof clothing: classic, modern, high-technological and functional content and in a wide range of colors. In addition to the original jackets with heat-sealing zips, storable in their pouch and produced with waterproof and wind-protecting warm and breathable materials, the collections include also fashion-oriented clothing and accessories which are identically practical and functional.

the Italian brand of cutting edge technical sporting products, in particular for cycling, skiing and running: eyewear, helmets, masks, accessories, underwear and clothing for professionals and enthusiasts. Briko®’s mission is to use the explosive energy of the brand to create iconically designed products for athletes and sportspeople requiring performance and safety without compromises.

exceptional American footwear. The brand, founded in Westbrook, Maine (USA) in 1946, takes its name from the nearby Sebago lake, which in the native American Abenaki language means “elongated water basin”. The brand launched with the famous “penny loafer”, handmade in accordance with local tradition and over the years has continued with best sellers such as the Docksides® boat . On July 31, 2017, the brand became part of the BasicNet Group portfolio with a view to a medium-high bracket positioning, to be worn as a sporting yet classy style. The Sebago® brand is now distributed across 90 markets worldwide.

is the jeans brand, created in 1971 by the youthful Maurizio Vitale and Oliviero Toscani.

is the high-end leisure, sport and formal occasion footwear brand, emerging from the racing and automobile world. The brand is positioned in the fashion segment. Since October 2011, the Basic Group has held 50% of the fashion categories (clothing and

footwear) of the brand and is also a global licensee.

2. The Business System The BasicNet Group has developed around a “network” business model, targeting licensees as the ideal partner for the development, distribution and sourcing of its products globally, choosing partners which act not only as a product supplier, but as an integrated supplier of services, i.e. a business development partner. Innovative, flexible and modular, the Business System of BasicNet has enabled the Group to grow quickly, although maintaining a lean and agile structure: a large enterprise centered around many businesses connected among themselves and with the parent company on a fully web-based network integrated IT platform designed to maximize information flows through real time sharing.

The Business System was drawn up and structured to develop both internal lines (new licensees and new markets) and external lines (new brands developed or acquired and new business lines). The functioning of the Business System is very simple. The Parent Company BasicNet S.p.A. controls the strategic activities:

o product research and development; o global marketing; o Information Technology, i.e. the creation of new software for the online management of all supply chain processes; o co-ordination of production and commercial activity information flows on the licensees’ Network; o strategic finance. Licensees, according to region or goods category, distribute products to retailers, carry out local marketing, regional logistics and working capital funding. The licensees involved in BasicNet brand finished product management (sourcing centers) apply a similar model and distribute to commercial licensees in their respective areas. As part of the Business System development, the Group has also established a direct customer sale system, currently developed by the Italian licensee, called plug@sell®. The model comprises a web-based integrated sales management system, with a platform which simply manages all daily activities at the store in real time, from orders to stock management, to accounting and training of staff (pre-opening and ongoing), through class-based and online training. As part of the retail project of BasicRetail S.r.l. (a company entirely held by BasicItalia S.p.A.), the various brands have been developed around the three principal retail levels, through which the Group sells directly to the public in Italy: - (LEVEL I): Brands Stores located in city centers, high streets or shopping centers with specific franchising agreements; - (LEVEL II): Brand Outlets located in Outlet Villages; - (LEVEL III) Discount Stores: located in “out-of-town” commercial or industrial parks.

The formats have been developed in order to ensure presence on a wide range of market segments.

3. Web Integration The IT platform is one of the major strategic investments for the Group, with a high degree of focus in terms of staffing and centrality to Business System development. This platform was designed and developed in a fully web integrated manner as the perfect communication tool between Network elements. The Information Technology department is involved therefore in the design and rolling out of the data collation and transmission systems which link the BasicNet Network companies together and externally. The business model therefore centers on e-processes, i.e. “.com” divisions - each of which with a production input and exchanging or negotiating with the other divisions, exclusively through the online platform.

STRUCTURE OF THE GROUP The Basic Group comprises Italian and international operating companies within the following sectors: - License management (Business System); - Proprietary licensees; - Property management.

The Business System operating segment includes the Parent Company BasicNet, the trademark holders of the Group, Basic Trademark S.A., Superga Trademark S.A., Fashion S.r.l., Jesus Jeans S.r.l. TOS S.r.l. (owner of the Sebago® brand and incorporated in 2017), the services company BasicNet Asia Ltd. in Hong Kong, Basic Properties B.V. in the Netherlands and the sub-licensee Basic Properties America, Inc. in the USA. In addition to the operations developed directly by BasicNet S.p.A., outlined above, the activities of the other companies concern the granting of the intellectual property rights of the BasicNet Group to licensees, administrating the contracts and managing the relative revenue streams.

The proprietary licensees are BasicItalia S.p.A. and its subsidiary BasicRetail S.r.l.. BasicItalia S.p.A. acts as a licensee for the usage and development of the intellectual property rights and of the products of all BasicNet brands for Italy. The company is the licensee and incubator for the testing of Group development projects. It holds a number of major sponsorship and merchandising contracts, some of which with international visibility, benefitting also the Group and the Network. BasicRetail manages Group brand sales points within the franchising project.

Property management is carried out by Basic Village S.p.A.. The company owns the former Maglificio Calzificio Torinese production site. Restructured and preserved in 1998, the facilities house the BasicNet Group headquarters and numerous other Group and third-party activities. At the end of 2016, it acquired the building adjacent to via Padova 78, leased to third parties.

BUSINESS TARGETS The Group objective is to extend its global leadership position through the strength of its brands. The Group project centers on: - the consolidation and expansion of the brands in areas with a pre-existing presence, supporting the growth of licensees through the Business System; - extending the territorial coverage of the brands, through finding new qualified licensees - particularly for more recently acquired brands; - the development of the plug@sell® shops, allowing licensees to improve market presence and to efficiently target end-consumers; - the search for fresh investment and development opportunities on new markets.

The following chart sets out the organizational structure of the BasicNet Group:

BASICNET S.p.A.

100% 100% 100% 100% 100% 100% 50%

BASIC BASIC VILLAGE BASICNET ASIA BASICITALIA S.p.A. JESUS JEANS S.r.l. TOS S.r.l. FASHION S.r.l. PROPERTIES BV S.p.A. Ltd.

100%

BASICRETAIL S.r.l.

100% 100% 100%

(*) (*) BASIC SUPERGA BASIC PROPERTIES TRADEMARK S.A. TRADEMARK S.A. AMERICA, Inc.

(*) With offices in Italy