NOT FOR DISTRIBUTION IN THE UNITED STATES - Irish Stock Exchange

NOT FOR DISTRIBUTION IN THE UNITED STATES

                                               Alitalia – Società Aerea Italiana S.p.A.
                               (incorporated with limited liability under the laws of the Republic of Italy)
                                                              €375,000,000
                                               5.250 per cent. Notes due 30 July 2020

The issue price of the €375,000,000 5.250 per cent. Notes due 30 July 2020 (the “Notes”) of Alitalia – Società Aerea Italiana S.p.A.
(the “Issuer” or “Alitalia”) is 100 per cent. of their principal amount.
Unless previously redeemed or cancelled, the Notes will be redeemed at their principal amount on 30 July 2020. The Notes are subject
to redemption, in whole but not in part, at their principal amount, plus interest, if any, to the date fixed for redemption in the event of
certain changes affecting taxation in the Republic of Italy and at the option of the Issuer at any time at an amount calculated on a
“make-whole” basis. In addition, the holder of a Note may, by the exercise of the relevant option, require the Issuer to redeem or, at
the Issuer’s option, purchase such Note at 100 per cent. of its principal amount together with accrued and unpaid interest (if any) to
(but excluding) the Put Date upon the occurrence of a Change of Control (each as defined below). See “Terms and Conditions of the
Notes — Redemption and Purchase”.
The Notes will bear interest from (and including) 30 July 2015 (the “Issue Date”) at the rate of 5.250 per cent. per annum. Interest on
the Notes will be payable annually in arrear on 30 July in each year. Payments on the Notes will be made in Euro without deduction
for or on account of taxes imposed or levied by the Republic of Italy to the extent described under “Terms and Conditions of the Notes
– Taxation”.
The Notes will constitute senior, unsecured obligations of the Issuer which will at all times rank pari passu among themselves and at
least pari passu with all other present and future unsecured obligations of the Issuer, save for certain mandatory exceptions of
applicable law.
The prospectus (the “Prospectus”) has been approved by the Central Bank of Ireland (the “Central Bank”), as competent authority
under Directive 2003/71/EC, as amended (including by Directive 2010/73/EU, to the extent that such amendments have been
implemented in a relevant member state of the European Economic Area) (the “Prospectus Directive”). The Central Bank only
approves this Prospectus as meeting the requirements imposed under Irish and EU law pursuant to the Prospectus Directive.
Application has been made to the Irish Stock Exchange plc (the “Irish Stock Exchange”) for the Notes to be admitted to the official
list of the Irish Stock Exchange (the “Official List”) and trading on its regulated market (“Main Securities Market”). The Main
Securities Market is a regulated market for the purposes of Directive 2004/39/EC. Such approval relates only to the Notes which are to
be admitted to trading on the Main Securities Market or other regulated markets for the purposes of Directive 2004/39/EC or which are
to be offered to the public in any member state of the European Economic Area. This Prospectus is available for viewing on the
website of the Irish Stock Exchange.
This Prospectus is a prospectus for the purposes of Article 5.3 of the Prospectus Directive.
The Notes have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and are subject to United States tax law requirements. The Notes are being offered outside the United States by the Sole Underwriter
(as defined below) in accordance with Regulation S under the Securities Act (“Regulation S”), and may not be offered, sold or
delivered within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act. For a description of certain restrictions on transfers of
the Notes, see “Subscription and Sale”.
Investing in the Notes involves risks. See “Risk Factors” beginning on page 1 of this Prospectus for a discussion of certain risks
prospective investors should consider in connection with any investment in the Notes.
The Notes will be in bearer form in the denomination of €100,000 each and, for so long as the Notes are represented by a Global Note
(as defined below) and Euroclear Bank SA/NV (“Euroclear”) and Clearstream Banking, société anonyme (“Clearstream,
Luxembourg”) (or other relevant clearing system) allow, in denominations of €1,000 in excess of €100,000, up to and including
€199,000. The Notes will initially be in the form of a temporary global note (the “Temporary Global Note”), without interest
coupons, which will be deposited on or around the Issue Date with a common safekeeper for Euroclear and Clearstream, Luxembourg.
The Temporary Global Note will be exchangeable, in whole or in part, for interests in a permanent global note (the “Permanent
Global Note”, and together with the Temporary Global Note, each a “Global Note”), without interest coupons, not earlier than
40 days after the Issue Date upon certification as to non-U.S. beneficial ownership. Interest payments in respect of the Notes cannot be
collected without such certification of non U.S. beneficial ownership. The Permanent Global Note will be exchangeable in certain
limited circumstances in whole, but not in part, for Notes in definitive form in principal amounts equal to €100,000 and integral
multiples of €1,000 in excess thereof, up to and including €199,000, each with interest coupons attached. No Notes in definitive form
will be issued with a denomination above €199,000. See “Overview of Provisions Relating to the Notes in Global Form”.
                                                         SOLE UNDERWRITER
                                                           Morgan Stanley

                                                    Prospectus dated 28 July 2015

EMEA 100217621 v16

IMPORTANT NOTICES

This document comprises a prospectus for the purposes of Article 5.4 of the Prospectus Directive and for the
purpose of giving information with regard to the Issuer, the Issuer and its subsidiaries and affiliates taken as a
whole (the “Group” or the “Alitalia Group”) and the Notes which according to the particular nature of the
Issuer and the Notes, is necessary to enable investors to make an informed assessment of the assets and
liabilities, financial position, profit and losses and prospects of the Issuer.
The Issuer accepts responsibility for the information contained in this Prospectus. To the best of the
knowledge of the Issuer (which has taken all reasonable care to ensure that such is the case), the information
contained in this Prospectus is in accordance with the facts and contains no omission likely to affect the
import of such information.
The Issuer has confirmed to Morgan Stanley & Co. International plc (the “Sole Underwriter”) that this
Prospectus contains or incorporates all information regarding the Issuer, the Group and the Notes which is (in
the context of the issue and offering of the Notes) material; such information is true and accurate in all
material respects and is not misleading in any material respect; any opinions, predictions or intentions
expressed in this Prospectus on the part of the Issuer or the Group are honestly held or made and are not
misleading in any material respect; this Prospectus does not omit to state any material fact necessary to make
such information, opinions, predictions or intentions (in such context) not misleading in any material respect;
and all proper enquiries have been made to ascertain and to verify the foregoing.
No representation, warranty or undertaking, express or implied, is made and no responsibility or liability is
accepted by the Sole Underwriter, BNP Paribas Trust Corporation UK Limited as trustee (the “Trustee”) or
BNP Paribas Securities Services, Luxembourg Branch as principal paying agent (the “Principal Paying
Agent”) as to the accuracy or completeness of the information contained in this Prospectus or any other
information provided by the Issuer in connection with the Notes or their distribution.
This Prospectus is to be read in conjunction with all documents which are deemed to be incorporated herein
by reference (see “Financial Information Relating to CAI and the Issuer — Issuer’s and CAI’s information
incorporated by reference”). This Prospectus should be read and construed on the basis that such documents
are incorporated in and form part of this Prospectus.
Investors should rely only on the information contained in this Prospectus. The Issuer has not authorised
anyone to provide investors with different information. None of the Sole Underwriter or the Issuer is making
any offer of the Notes in any jurisdiction where the offer is not permitted. You should not assume that the
information contained in this Prospectus is accurate as of any date other than the date on the cover of this
Prospectus regardless of the time of delivery of this Prospectus or of any sale of the Notes.
The Issuer has not authorised the making or provision of any representation or information regarding the
Issuer or the Notes other than as contained in this Prospectus or as approved for such purpose by the Issuer.
Any such representation or information should not be relied upon as having been authorised by the Issuer or
the Sole Underwriter.
Neither the delivery of this Prospectus nor the offering, sale or delivery of any Note shall in any circumstances
create any implication that the information contained herein concerning the Issuer and/or its Group is correct
at any time subsequent to the date hereof or that any other information supplied in connection with the
offering of the Notes is correct as of any time subsequent to the date indicated in the document containing the
same or that there has been no adverse change, or any event reasonably likely to involve any adverse change,
in the condition (financial or otherwise) of the Issuer and/or its Group since the date of this Prospectus.
Neither this Prospectus nor any other information supplied in connection with the offering, sale or delivery of
any Note (a) is intended to provide the basis of any credit or other evaluation or (b) should be considered as a
recommendation by the Issuer or the Sole Underwriter that any recipient of this Prospectus should purchase
any Note. Each investor contemplating purchasing any Note should make its own independent investigation
of the financial condition and affairs, and its own appraisal of the creditworthiness, of the Issuer and the
Group. Neither this Prospectus nor any other information supplied in connection with the issue of the Notes
constitutes an offer or invitation by or on behalf of the Issuer or the Sole Underwriter to any person to
subscribe for or to purchase any Notes.

EMEA 100217621 v16

This Prospectus does not constitute an offer of, or an invitation to subscribe for or purchase, any Notes.
Each recipient of this Prospectus shall be taken to have made its own investigation and appraisal of the
condition (financial or otherwise) of the Issuer and the Group and of the rights attaching to the Notes.
The distribution of this Prospectus and the offering, sale and delivery of Notes in certain jurisdictions may be
restricted by law. Persons into whose possession this Prospectus comes are required by the Issuer and the
Sole Underwriter to inform themselves about and to observe any such restrictions. For a description of certain
restrictions on offers, sales and deliveries of Notes and on distribution of this Prospectus and other offering
material relating to the Notes, see “Subscription and Sale”.
In particular, the Notes have not been, and will not be, registered under the Securities Act and are subject to
United States tax law requirements. Subject to certain exceptions, Notes may not be offered, sold or delivered
within the United States or to U.S. persons.
In this Prospectus, unless otherwise specified, references to a “Member State” are references to a Member
State of the European Economic Area and references to “€”, “EUR” or “Euro” are to the currency introduced
at the start of the third stage of European economic and monetary union, and as defined in Article 2 of Council
Regulation (EC) No 974/98 of 3 May 1998 on the introduction of the euro, as amended. References to
“billions” are to thousands of millions.
This Prospectus is drawn up in the English language. In case there is any discrepancy between the English
text and the Italian text, the English text stands approved for the purposes of approval under the Prospectus
Directive. Certain legislative references and technical terms have been cited in their original language in
order that the correct technical meaning may be ascribed to them under applicable law.
Certain figures included in this Prospectus have been subject to rounding adjustments; accordingly, figures
shown for the same category presented in different tables may vary slightly and figures shown as totals in
certain tables may not be an arithmetic aggregation of the figures which precede them.
In compliance with the requirements of the Irish Stock Exchange, this Prospectus is available on the website
of the Irish Stock Exchange (www.ise.ie).
                                         Forward-looking statements
This Prospectus may contain forward-looking statements, including (without limitation) statements identified
by the use of terminology such as “anticipates”, “believes”, “estimates”, “expects”, “intends”, “may”, “plans”,
“projects”, “will”, “would” or similar words. These statements are based on the Issuer’s current expectations
and projections about future events and involve substantial uncertainties. All statements, other than
statements of historical facts, contained herein regarding the Issuer’s strategy, goals, plans, future financial
position, projected revenues and costs or prospects are forward-looking statements. Forward-looking
statements are subject to inherent risks and uncertainties, some of which cannot be predicted or quantified.
Future events or actual results could differ materially from those set forth in, contemplated by or underlying
forward-looking statements. The Issuer does not undertake any obligation to publicly update or revise any
forward-looking statements.
                                                  Stabilisation

In connection with the issue of the Notes, Morgan Stanley & Co. International plc. (the “Stabilising
Manager”) (or any person acting for the Stabilising Manager) may over-allot Notes or effect transactions with
a view to supporting the market price of the Notes at a level higher than that which might otherwise prevail.
However, there can be no assurance that the Stabilising Manager (or any person acting on its behalf) will
undertake stabilisation action. Any stabilisation action may begin on or after the date on which adequate
public disclosure of the terms of the offer of the Notes is made and, if begun, may be discontinued at any time,
but must end no later than the earlier of thirty (30) days after the issue date of the Notes or sixty (60) days
after the date of allotment of the Notes. Such stabilising shall be in compliance with all applicable laws,
regulations and rules.

EMEA 100217621 v16

Market share information and statistics
This Prospectus contains statements regarding the Issuer’s industry and its relative competitive position in the
industry that are not based on published statistical data or information obtained from independent third parties,
but are based on the Issuer’s experience and its own investigation of market conditions, including its own
elaborations of such published statistical or third-party data. Although the Issuer’s estimates are based on
information obtained from its customers, sales force, trade and business organisations, market survey agencies
and consultants, government authorities and associations in its industry which it believes to be reliable, there
is no assurance that any of these assumptions are accurate or correctly reflect the Issuer’s position in the
industry. None of the Issuer’s internal surveys or information have been verified by independent sources.

EMEA 100217621 v16

TABLE OF CONTENTS

                                                                                                                                                          Page
RISK FACTORS ................................................................................................................................................. 1
FINANCIAL INFORMATION RELATING TO CAI AND THE ISSUER .................................................... 17
TERMS AND CONDITIONS OF THE NOTES .............................................................................................. 19
OVERVIEW OF PROVISIONS RELATING TO THE NOTES IN GLOBAL FORM ................................... 35
USE OF PROCEEDS ........................................................................................................................................ 37
DESCRIPTION OF THE ISSUER.................................................................................................................... 38
SHAREHOLDERS............................................................................................................................................ 49
REGULATORY ENVIRONMENT .................................................................................................................. 50
MANAGEMENT .............................................................................................................................................. 54
TAXATION ...................................................................................................................................................... 60
SUBSCRIPTION AND SALE .......................................................................................................................... 67
GENERAL INFORMATION............................................................................................................................ 69
INDEX TO THE ISSUER’S UNAUDITED FINANCIAL STATEMENTS AS AT AND FOR THE
YEAR ENDED 31 DECEMBER 2014 ............................................................................................................. 71

EMEA 100217621 v16                                                             (i)

RISK FACTORS
Before deciding to purchase the Notes, investors should carefully review and consider the following risk
factors and the other information contained in this Prospectus or any supplement to this Prospectus. The
Issuer believes that the following factors may affect its ability to fulfil its obligations under the Notes. Should
one or more of the risks described below materialise, this may have a material adverse effect on the business,
financial condition and results of operations of the Issuer and/or the Group. In particular, it could
significantly and adversely affect the Issuer’s ability to pay interest or repay the principal on the Notes. As a
result, the market value of the Notes may deteriorate and the holders of the Notes (the “Noteholders”) could
lose part or all of their investments.
All of these factors are contingencies which may or may not occur, and the Issuer is not in a position to
express a view on the likelihood of any such contingency occurring. In addition, factors which are material
for the purpose of assessing the market risks associated with the Notes are described below. The order in
which the risks are presented does not reflect the likelihood of their occurrence of the magnitude or
significance of the individual risk. In addition, investors should be aware that the risks described might
combine and thus intensify one another.
The Issuer believes that the factors described below represent the principal risks inherent in investing in the
Notes, but the inability of the Issuer to pay interest, principal or other amounts on or in connection with the
Notes may occur for other reasons which may not be considered significant risks by the Issuer based on
information currently available to the Issuer or which it may not currently be able to anticipate. Prospective
investors should also read the detailed information set out elsewhere in this Prospectus and reach their own
views prior to making any investment decision. An investment in the Notes is only suitable for investors who
are in a position to fully assess the risks relating to such an investment and who have sufficient financial
means to absorb any potential loss stemming therefrom.
RISKS RELATING TO THE AIRLINE INDUSTRY
General economic conditions could have an adverse impact on the Group’s business.
The Group’s revenue is highly sensitive to economic conditions in the markets in which the Group operates.
The Group derives approximately 30% of revenues on routes within Italy and minor revenues on routes to
Spain and Greece, each of which have experienced some form of economic hardship in the recent past.
Demand for air travel and ground services depends on economic conditions, employment levels, consumer
and business confidence and the availability of consumer and business credit.
The airline industry in general tends to experience significant adverse financial results during economic
downturns as leisure travellers often choose to reduce their transportation or reduce the price they pay for such
transportation. Businesses also usually reduce the volume of their business travel, either due to cost-saving
measures or as a result of decreased business activity requiring travel. In addition, premium services could
become less desirable during a significant downturn, which could disproportionately affect the Group’s
revenues. Further, an economic downturn tends to result in a decrease in air cargo revenue, as international
trade decreases and businesses look to run down their inventories and send freight by more economical routes.
The impact of an economic downturn might also induce governments to unilaterally grant subsidies or other
public aid to the Group’s competitors, which could distort the markets and harm the Group’s competitive
position.
Any materialisation of these risks could have a material adverse effect on the Group’s business, financial
condition and/or results of operations.
The airline industry is highly competitive and the Group faces competition from other airlines as well as
from alternative means of transportation.
The Group operates in a highly competitive market, in which it competes with other airlines and relies on
positive brand recognition, amongst other factors, to attract and retain customers. Competition is affected by
factors including fares, routes and frequency of flights, the geographical location of hub airports used by other
airlines, reputation, safety record, reliability and/or punctuality, range and quality of passenger services

EMEA 100217621 v16                                      1

provided and type and age of aircraft. The Group’s competitors include low-cost carriers, legacy airlines,
other established commercial and charter airlines, ground handling service providers, travel conglomerates
with integrated airlines and new airlines entering the market. Due to existing overcapacity in the airline
industry, competition is expected to increase further. As a consequence, competition across full-service
carriers will intensify and the latter will also come under increased pressure from low cost carriers, which in
turn will struggle differentiating solely on the basis of low fares (due to higher costs) and will therefore seek
to improve their offering and/or enter certain markets traditionally catered for by full service carriers only (for
example, business travel).
The Group’s competitors may seek to protect or gain market share through fare-matching or price-discounting
or by offering more attractive flight schedules or services. Certain competitors may also be able to offer lower
fares, for example by providing passengers with fewer services or using financial resources which are
unavailable to the Group.
Any of these risks could have a material adverse effect on the Group’s business, financial condition and/or
results of operations.
Severe weather conditions could have an adverse effect on the Group’s business.
Severe weather conditions may result in substantial additional costs or loss of revenue for the Group.
Inclement weather can lead to flight delays and cancellations, aircraft de-icing, additional heating for cabins
and increased fuel consumption due to cold weather. Any materialisation of these risks could have a material
adverse effect on the Group’s business, financial condition and/or results of operations.
Natural or man-made disasters, epidemics and pandemics could have an adverse effect on airline
operations and demand for air travel.
Any activity from volcanoes, or other natural or man-made disasters, in particular if such disasters occur in the
airspace or regions in which the Group operates or at or in proximity to any of the Group’s major flight
destinations, could result in substantial reductions in, and/or cancellations of, bookings and flights not only to
the affected region but also more generally, thereby reducing overall demand for the Group’s services.
Insurance coverage for such risks may not be available on commercially acceptable terms or at all.
The outbreak of epidemics and pandemics such as “severe acute respiratory syndrome”, “Middle East
respiratory syndrome”, avian flu, swine flu, Ebola or other diseases could also weaken the demand for air
travel and materially adversely affect airline operations.
Any of the above risks could have a material adverse effect on the Group’s business, financial condition
and/or results of operations.
Terrorist attacks, military, civil and political conflicts could have an adverse effect on airline operations.
The terrorist attacks of 11 September 2001 and other attempted terrorist attacks since that date involving
commercial aircraft severely and adversely impacted the prospects of the airline industry, resulting in reduced
demand for air travel and higher security costs for airlines. In addition, in the immediate aftermath of the
terrorist attacks of 11 September 2001, insurers either stopped providing coverage against certain risks
relating to acts of war and other hostilities or substantially increased premiums for renewed coverage, while at
the same time greatly reducing the amount of coverage provided. Furthermore, the political upheavals in
North Africa, the Middle East and the ongoing Ukrainian conflict, where in July 2014 a commercial aircraft
flying over Ukraine was shot down with significant loss of life, adversely affect flight bookings in and around
those regions. The occurrence of further terrorist attacks, acts of sabotage, new military, civil and political
conflicts or the expansion of existing conflicts or similar events, especially if they are directed against air
traffic or occur in markets that are significant to the Group, or if they affect a relatively high proportion of the
overall volume of air traffic generally or crude oil prices (and therefore prices for aviation fuel), could have a
material adverse effect on the Group’s business, financial condition and/or results of operations.
The Group is exposed to the risk of losses from aircraft crashes or similar incidents.
An aircraft accident or incident could result in significant loss for the Group and give rise to costs related to
the repair or replacement of a damaged aircraft and its temporary or permanent loss from service, and claims

EMEA 100217621 v16                                       2

from injured passengers and dependents of deceased passengers. Even if the Group’s insurance coverage
were adequate in the event such circumstances arise, any such event could cause a substantial increase in its
insurance premiums.
In addition, Regulation (EC) No. 2027/97, as amended by Regulation (EC) No. 889/2002, which governs
airline carriers’ liability towards passengers, has increased the potential exposure of airlines to civil liability.
Although the Group has extended its insurance coverage to meet the requirements of the above regulation, no
assurance can be given that laws, regulations or policies will not be applied or amended in the future in a
manner that could have a material adverse effect on the Group’s business, financial condition and/or results of
operations.
Any materialisation of these risks could have a material adverse effect on the Group’s business, financial
condition and/or results of operations.
Aircraft accidents could have an adverse impact on the Group’s reputation.
Any aircraft accident or incident involving the Group could create a public perception that it is less safe or
reliable than other airlines and cause passengers or cargo customers to lose confidence in the Group and
switch to other airlines or other means of transportation. Passengers or cargo customers could also lose
confidence in the Group if another airline were to suffer such loss or damage. This could have a material
adverse effect on the Group’s business, financial condition and results of operations.
The airline industry is characterised by high operational and regulatory costs.
The airline industry is generally characterised by high fixed costs, low margins and highly volatile revenues.
Each flight is subject to fixed operating costs, including costs for the use of airport infrastructure and services,
take-off, landing and air traffic control fees as well as other air traffic charges, maintenance, financing, lease
and fuel costs, depreciation expenses, insurance and labour costs. By contrast, the revenues generated by each
flight are variable and are directly related to the number of passengers or cargo carried and, in the case of
passengers, the fare structure of the flight. Accordingly, a change in the number of passengers, cargo or in
average fares could have a negative effect on the Group’s business, financial condition and results of
operations. In addition, changes to the regulatory framework in which the Group operates, particularly as
regards tax, safety and environmental regulations, and to other costs inherent in the airline industry, including
aviation fuel, aviation insurance and cost of access to capital or financing, could result in the Group’s
activities being subject to significantly higher costs. Any of these risks could have a material adverse effect
on the Group’s business, financial condition and/or results of operations.
Any breach of applicable rules could materially affect the Group’s ability to continue to operate
commercial passenger and cargo air transport services and in particular lead to operating licences and air
traffic rights being suspended or revoked.
The Group is authorised to operate by virtue of operating licences and air carrier certificates which are subject
to the Group’s ongoing compliance with currently applicable and future statutes, rules and regulations
imposed by governments and other authorities. National, EU and international regulations, as well as bilateral
and multilateral treaties between Italy, EU member states and the EU on the one hand, and other states on the
other, govern airline operations and impose requirements on airline carriers. In particular, these multilateral
and bilateral agreements impose restrictions on the allocation of traffic rights which are necessary for
passenger and cargo airlines operating international commercial airline services in order to land in, take off
from and fly over states.
If a competent authority that has issued an operating licence to the Group should come to the conclusion that
the Group no longer satisfies the relevant requirements to hold such licence, including ownership and control
requirements, it could take measures that could result in the loss of traffic rights and the suspension or
revocation of the operating licence.
Amendments of existing statutes, rules, regulations and treaties or any changes in their interpretation, the
conclusion of new treaties or the breakdown of treaty negotiations, as well as the introduction of new
regulatory requirements or the extension of existing requirements, could also result in significant operational
costs for the Group and limit its flexibility and ability to respond to market conditions, competition or changes

EMEA 100217621 v16                                       3

to its cost structure. Any of these risks could have a material adverse effect on the Group’s business, financial
condition and/or results of operations.
The Group’s access to airports could be limited by slot allocations and restrictions imposed by legislators or
regulatory authorities.
Air traffic is limited by the airport infrastructure and by the number of slots available for aircraft arrivals and
departures at a particular airport. A slot represents the authorisation to take off and land at a particular time
during a specified scheduling period. Within the EU, slots are assigned to airlines in accordance with Council
Regulation (EEC) No 95/93 of 18 January 1993, as amended by Regulation (EC) No 545/2009 of the
European Parliament and of the Council of 18 June 2009. Established airlines have priority rights (known as
“grandfather rights”) to particular slots at certain airports. In addition, a number of major European airports
and other major international airports are currently operating at close to their full capacity, meaning that there
is limited capacity to operate at these airports. Should slot coordinators or other authorities in charge of
allocating time slots at airports not offer sufficient slots to the Group at the times it needs them or on
acceptable terms, the Group may be unable to expand its activities or obtain more favourable slots and may be
forced to restrict the use of its aircraft. In addition, the rules governing the use of slots provide that the right
of use may expire if the slots are unused either temporarily or in the long term. Therefore, should the Group
fail to use the slots it has been allocated, whether for technical or commercial reasons, it could potentially lose
the right to use these slots.
Legislators or regulatory authorities may impose additional operating restrictions at airports, such as landing
and take-off curfews, limits on aircraft noise and emission levels, mandatory flight paths, runway restrictions
and limits on the number of average daily departures. Such restrictions may limit the ability of the Group to
provide or increase services at such airports and may result in loss of revenue and/or additional costs.
Any of these risks could have a material adverse effect on the Group’s business, financial condition and/or
results of operations.
Airport, transit, landing and air traffic control fees, security charges and the costs airlines must pay to
ensure air traffic security may continue to increase.
Airport, transit, landing and air traffic control fees, security charges and the costs airlines must pay to ensure
air traffic security, as well as costs for ground handling services, such as maintenance, fuel and oil services,
baggage and freight handling, passenger check-in and surface transport at the airport, represent a significant
portion of the operating costs of the Group. Any fees imposed by an airport to third party ground handling
operators may further increase such costs, which could affect the fares that the Group must charge to its
passengers or cargo customers in order to operate cost-effectively.
Future events or developments, such as terrorist acts or other conflicts, could also result in more stringent
security regulations being imposed on air traffic, which could also result in an increase in the Group’s
operating costs. If the Group is unable to pass on increases in fees, charges or other costs to its customers,
such increases could have a material adverse effect on its business, financial condition and/or results of
operations.
The Group is dependent on third parties to provide certain services and facilities and is exposed to the risk
of failure of third party service and facility providers.
In order to operate its business, the Group is dependent on the provision of services by third parties, including
air traffic controllers, airport authorities and operators, security personnel, towing and pushback vehicle
drivers, passenger transporters, operators of booking systems and call centres, caterers, check-in staff and
baggage-handling and fuel service providers, contractors that perform aircraft and engine maintenance and
provide customer services and wet lessors (see also “— The Group is exposed to the risk of failure of wet
lessors”). If any third party services or facilities on which the Group depends in order to operate its business
are restricted, temporarily suspended (for example, as a result of technical problems, strikes or insolvency of
the relevant service provider), terminated or become unavailable on commercially acceptable terms, this could
have a material adverse effect on the Group’s business, financial condition and/or results of operations. Any
termination or expiry of contracts entered into by the Group with third-party service or facility providers and
any inability to negotiate and enter into replacement contracts with other third-party service or facility

EMEA 100217621 v16                                       4

providers on similar commercial terms, or any inability to enter into such contracts in any new markets the
Group accesses, could also have a material adverse effect on the Group’s business, financial condition and/or
results of operations. In addition, the efficiency, timeliness and quality of the services provided pursuant to
these contracts by third-party providers are beyond the Group’s direct control.
In order to be able to provide catering services, the Group relies on suppliers of products, services and raw
materials. If supplies fail to meet certain quality, quantity and other specifications, the Group could become
subject to claims and other liabilities and its relationship with customers could suffer as a result. Furthermore,
if a supplier for any reason is not able, or becomes unwilling, to supply the Group with the products or
services it requires, the Group would need to find a new supplier, which may be time consuming and costly.
There can be no assurance that the Group would be able to obtain alternative products and services from
different suppliers of an acceptable quality or standard or on commercially acceptable terms, which could also
affect its relationship with customers and reputation.
Any of these risks could have a material adverse effect on the Group’s business, financial condition and/or
results of operations.
The Group’s revenues are subject to seasonal fluctuations.
Demand for the Group’s passenger and cargo air transport and ground handling services fluctuates during the
course of the year, and as a result the levels of the Group’s aircraft utilisation rate and profitability also
fluctuate. Demand is normally higher in summer from May to October and during the Christmas holidays and
lower in winter from November to April (excluding the Christmas holidays). The occurrence of any flight
cancellations or other factors that could adversely affect aircraft utilisation, especially during peak seasons and
periods, could have a materially adverse effect on the Group’s business, financial condition and/or results of
operations.
The Group is exposed to the risk of failure of wet lessors.
The Group has entered, and may enter in the future, into wet lease agreements pursuant to which other airline
carriers (“wet lessors”) grant wet leases (i.e. leases of aircraft with personnel) of aircraft to the Group. In turn,
the Group grants to the same wet lessors dry leases (i.e. leases of aircraft without personnel) of aircraft leased
to the Group under the wet leases. In the event of default by, or insolvency of, a wet lessor, the Group may be
exposed to the risk of not receiving from the relevant wet lessor passenger transport services pursuant to the
wet lease and, nevertheless, of having to comply with its obligations under the dry lease without however
receiving any income from the dry lessor. Any materialisation of these risks could have a material adverse
effect on the Group’s business, financial condition and/or results of operations.
RISKS RELATING TO THE GROUP
The Group’s success and ability to maintain sufficient liquidity depends on its ability to achieve its global
business strategy.
The Group’s future growth, profitability and cash flows depend on its ability to successfully implement its
global business strategies (see “Description of the Issuer — Strategies”). There can be no assurance that the
Issuer can successfully achieve any or all of its strategic initiatives in the manner or time period that it expects.
Further, achieving these objectives will require investments which may result in short-term costs without
generating any current net revenues and, therefore, may be dilutive to the Group’s earnings, at least in the
short term. Moreover, if the Group’s strategic initiatives do not generate the expected benefits in a timely
manner, the Group may face significant liquidity pressures in the medium term and throughout the
implementation period of the strategic initiatives as a result of the associated investments required. The
Group cannot give any assurance that it will realise, in full or in part, the anticipated strategic benefits it
expects its strategies will achieve. The failure to realise those benefits could have a material adverse effect on
the Group’s business, financial condition and/or results of operations.
The Group may incur additional indebtedness for the financing of new aircraft.
The financing of new and existing aircraft has increased in the past, and may further increase, the total amount
of the Group’s outstanding debt and the payments that it is obliged to make to service such debt. The ability
of the Group to generate sufficient cash flow to service such debt in the long term will depend on its future

EMEA 100217621 v16                                       5

financial performance, which will be affected by a range of economic, competitive and business factors, many
of which are beyond its control. Any future orders of additional aircraft could further increase the Group’s
indebtedness and impact the terms on which it is able to secure financing.
The Group’s ability to borrow, enter into sale and leaseback arrangements on commercially acceptable terms,
refinance existing debt or raise additional debt, obtain payment and credit card services (including debt
collection services) and enter into fuel, currency, interest rate and other hedging agreements with suitable
counterparties depends on a number of factors, including prevailing interest rates, capital markets conditions
and the Group’s credit profile. There can be no assurance that the Group’s access to the debt markets will not
become more difficult, expensive or even impossible in the future (including due to new or additional
collateral requirements). This could have a material adverse effect on the Group’s business, financial
condition and/or results of operations.
The Group’s debt facilities require it to comply with specified financial covenants that may restrict its
current and future operations and limit its flexibility and ability to respond to changes or take certain
actions.
The Group’s business remains dependent on financing, and its debt agreements contain restrictive covenants.
There can be no assurance that these covenants will not constrain the Group’s ability to raise additional
financing in the future, which could delay or prevent the implementation of the Issuer’s plans and have a
material adverse effect on its business, financial condition and/or results of operations.
The Group faces risks in connection with its strategic alliances and joint ventures.
The Group is a member of the SkyTeam alliance, a brand marketing and services alliance between 20
worldwide airlines, and a party to the transatlantic joint venture with Air France, KLM and Delta Airlines (the
“Joint Venture”).
No assurance can be given that the SkyTeam alliance or the Joint Venture entered into by the Group will not
lose member airlines, whether as a result of one or more member airlines terminating their membership or
joint ventures or having their membership suspended. Furthermore, no assurance can be given that the
SkyTeam alliance or the Joint Venture will be able to attract the new members it may need to be successful in
the future. In addition, the success of the SkyTeam alliance and the Joint Venture depends in part on the
actions, brands and strategic plans of other airlines over which the Group has little control. If the SkyTeam
alliance or the Joint Venture were to lose their appeal as a result of changes in its membership or the actions of
a member or if the SkyTeam alliance or the Joint Venture were to dissolve, this could negatively affect,
among other things, the network of flights that the Group is able to offer its customers in the absence of an
alternative solution. Should a member or party leave the SkyTeam alliance or the Joint Venture or fail to meet
its obligations thereunder, this could have a material adverse effect on the Group’s business, financial
condition and/or results of operations.
The Group is exposed to the risk of flight delays and cancellations due to its high aircraft utilisation rates.
The Group’s business model is characterised by high aircraft utilisation rates to maximise revenues. High
aircraft utilisation rates are achieved by keeping the number of “block hours”, i.e. the hours from take-off to
landing, including taxi time, as high as possible to enable operators to fly more hours on average each day.
High block hours are achieved by reducing turnaround time at airports, including the amount of ground time
for loading and unloading, cleaning, refuelling, crew changes and necessary maintenance. As a result of its
high aircraft utilisation, the Group is exposed to, and may be adversely affected by, the risk of delays and
flight cancellations caused by various factors, many of which may be beyond its control, including air traffic
congestion, air traffic control problems, processing delays on the ground, adverse weather conditions,
industrial action by air traffic controllers, delays or non-performance by third-party service providers and
unscheduled maintenance, increased security measures or breaches of security, international or domestic
conflicts, terrorist activity or other changes in business conditions. A delay or cancellation of one flight could
result in delays or cancellations to subsequent flights. If the Group’s flights become subject to regular or
severe delays or cancellations, its reputation may suffer as a consequence and its customers may choose to fly
with other airlines in the future. The Group could also be required to refund and provide assistance to
passengers for flight delays (see “— Passenger rights and compensation could cause significant costs for the
Group”).

EMEA 100217621 v16                                      6

Any of these risks could have a material adverse effect on the Group’s business, financial condition and/or
results of operations.
The Group is dependent on good relations with its employees and unions.
The Group is dependent on qualified personnel, including pilots (who from time to time are in short supply in
the aviation industry), cabin crew and employees with qualifications in aircraft maintenance, information
technology and sales. There can be no assurance that the Group will be able to retain employees in key
positions or recruit a sufficient number of new employees with appropriate technical qualifications to
compensate for the loss of employees or to accommodate its future growth, and, in certain cases, the Group
may have to invest significant amounts of time in recruiting and training new pilots and other personnel. In
addition, the Group’s workforce is partially unionised and covered by collective bargaining agreements that
regulate work conditions and remuneration. These collective bargaining agreements are from time to time
subject to renegotiation with the unions or unions may try to enter into new agreements which are more costly
for the Group or its labour suppliers, resulting in higher direct or indirect labour cost. Furthermore, changes in
law relating to salaries of airline employees and collective bargaining agreements may result in higher costs
for the Group. As a result, the Group may have to increase salaries or face strikes by its employees or other
industrial action. Any of these risks could have a material adverse effect on the Group’s business, financial
condition and/or results of operations.
The Group depends on the uninterrupted operation of its own and third-party automated systems and
technology.
The ability of the Group to generate bookings, manage ticket sales, receive and process reservations and
payments, manage its traffic network, perform flight operations and engage in other critical business tasks is
dependent on the efficient and uninterrupted operation of its computer and communication systems, including
backup facilities for a breakdown of the Group’s operation control centres, as well as systems used by third
parties conducting business with the Group. For instance, the Group uses tablet PCs in the cockpits of its
aircraft to replace paper documents such as flight maps, manuals and other documents which operate on the
basis of individualised software and related complex IT infrastructure for the exchange of data. In the event
that this system fails, the operation of the Group’s fleet may be suspended. Computer and communication
systems are vulnerable to disruptions, damage, power outages, acts of terrorism or sabotage, computer viruses,
fires and other events and programming errors, and there can be no assurance that systems used by the Group
or third parties, including revenue management systems, and by the Group’s sales partners, such as the
Group’s booking system and reservation systems of travel agencies, will operate efficiently and without
interruption. Any disruption to the computer and communication systems used by the Group or third parties
conducting business with it, particularly if such disruption persists, could significantly impair the Group’s
ability to operate efficiently and could have a material adverse effect on its business, financial condition
and/or results of operations.
The Group is exposed to risks associated with fluctuations in aviation fuel prices. In addition, the existing
tax exemption for aviation fuel in the EU could be repealed or amended.
The operating results of the Group’s passenger and cargo airline businesses are significantly impacted by
changes in the price of aviation fuel, which is very volatile and fluctuates depending on the levels of supply
and demand. If due to political developments, general economic conditions or other circumstances prices for
aviation fuel increase, this could have a material adverse effect on the Group’s business, financial condition
and/or results of operations. In addition, any fall in fuel prices could lead to increased pressure on prices and
greater competition and may affect the Group’s ability to hedge adequately.
Over the past few years there have been discussions both at the EU executive level and within EU Member
States about whether the existing tax exemptions for aviation fuel should be reviewed. There can be no
assurance that the current tax exemptions for aviation fuel will not be repealed or amended. The elimination
or reduction of current tax exemptions for aviation fuel in the EU would lead to a substantial increase in the
Group’s aviation fuel costs, which could have a material adverse effect on the Group’s business, financial
condition and/or results of operations.

EMEA 100217621 v16                                      7

The Group is exposed to risks associated with fluctuations in interest rates and currency exchange rates.
The Group’s aviation fuel payment obligations and a substantial portion of its aircraft operating lease and
maintenance, repair and overhaul payment obligations, debt-service obligations and underlying financial
liabilities are denominated in U.S. dollars. As a result, the Group is particularly vulnerable to fluctuations in
currency exchange rates of countries in which the Group operates against the U.S. dollar. As the exchange
rate between, in particular, the euro and the U.S. dollar is likely to continue to fluctuate in the future, there can
be no assurance that fluctuations in exchange rates will not materially adversely affect the Group’s results of
operations and financial condition in the future.
In addition, the Group is exposed to the risk of interest rate fluctuation, in particular arising under its financial
indebtedness. This varies according to the fixed or floating interest rate structure in place. As at 30 April
2015, 1.24% of the Group’s financial debt (consisting of €342 million) carried a fixed rate of interest whereas
98.76% of the Group’s financial debt carried a floating rate of interest.
While the Group uses hedging instruments to mitigate these risks, these may not fully protect it against the
adverse effects of fuel price increases or fluctuations in interest or currency exchange rates, largely because
the Group only hedges against a margin of fluctuation. Hedging also reduces the Group’s ability to benefit
from any fuel price decreases or any favourable exchange or interest rate developments. The Group’s
assumptions and estimates regarding the future developments of aviation fuel prices, currency exchange rates
and interest rates, and any risk-avoidance or risk-tolerance criteria selected by it, will have a substantial
impact on the success of its hedging policy. The Group’s business, financial condition and results of
operations could be materially adversely affected if its hedging policy is ultimately unsuccessful.
The Group’s route planning is subject to uncertainty and investments in new routes may not be successful.
The Group is implementing a number of new routes as part of its strategy. When the Group starts operating a
new route, its passenger load factors initially tend to be lower than those on its established routes and its
advertising and other promotional costs tend to be higher. As a result, new routes may require a substantial
amount of investment and may initially generate losses. Customers may also make less use of new routes or
additional capacity on existing routes than the Group may have predicted. In addition, if the Group operates a
new route it may experience more competition than expected, or competition on that route may exceed the
Group’s expectations in other ways. Should the Group be unable to assess demand, capacity and fares
correctly on new routes, this could have a material adverse effect on its business, financial condition and/or
results of operations.
From time to time the Group may be involved in disputes.
At the date of this Prospectus, the Issuer and other Group companies are parties to a limited number of legal
disputes arising in the ordinary course of their activities (see “Description of the Issuer — Litigation”).
There can be no assurance that the Group will not become subject to additional legal proceedings, or that it
would not need to be indemnified by CAI, in relation to the liabilities of CAI (see “Description of the Issuer
— Ring-fencing of CAI’s financial indebtedness and liabilities”). The Group monitors the development of
legal disputes and proceedings, also with the help of external advisers and, where necessary, will record
provisions considered appropriate in light of the circumstances following a prudent analysis of each dispute
and the risks concerned. The evaluation of risks is, however, subjective and necessarily involves estimations
of potential liabilities. There can therefore be no assurance that the ultimate outcome of these disputes will
not have a material adverse impact on the Group’s business, financial condition and/or results of operations.
RISKS RELATING TO REGULATION
Passenger rights and compensation could result in significant cost for the Group.
A number of jurisdictions have implemented rules on passenger rights, obliging airlines to provide assistance
and care, as well as re-routing or reimbursement to passengers in cases of flight disruptions, delays or denied
boarding. In addition, airlines have to compensate passengers in certain cases. For instance, the European
Union has passed legislation for compensating airline passengers who have been denied boarding or whose
flight has been cancelled or subject to delays (Regulation (EC) No 261/2004).

EMEA 100217621 v16                                       8

Such legislation, which came into force in February 2005, imposes, amongst others, fixed levels of
compensation to be paid to passengers in the event of cancellation, except when the airline can prove that such
cancellation was caused by extraordinary circumstances and could not have been avoided even if all
reasonable measures had been taken. The European Court of Justice (“ECJ”) has extended the right of
passengers to receive monetary compensation to cases where passengers whose flights are delayed reach their
final destination three hours or more after the originally scheduled arrival time. Passengers subject to long
delays (ranging from two hours or more to four hours or more, depending on the flight distance) are also
entitled to “assistance” free of charge, including meals, refreshments and telephone calls, as well as hotel
accommodation if the delay extends overnight. For delays of at least five hours, the airline is also required to
offer the option of a refund of the cost of the ticket and, if the passenger has already completed part of the
journey, a return flight to the initial point of departure. Regulation (EC) No 261/2004 generally applies to all
passengers departing from an airport located in the territory of an EU Member State, irrespective of whether
the airline is licenced by a Member State of the EU, and, if the airline is licenced by a Member State of the
EU, also to all passengers departing from an airport outside the EU to a destination within the EU. As a result,
cancellation and delay of flights may lead to a significant financial burden for airlines which are licenced by
an EU Member State or which operate in the EU.
A proposal for revision of Regulation (EC) No 261/2004, which is currently in the legislative process, has
been advanced which is aimed at strengthening and extending passenger rights to obtain compensation in case
flights are delayed or passengers are stranded upon the bankruptcy of an airline, as well as passenger rights in
connection with luggage. With respect to the additional passenger rights in case of delayed or rescheduled
flights, the proposed revised rules provide, among others, that airlines may refuse to pay compensation only
on the basis of an exhaustive list of defined extraordinary circumstances. Furthermore, passengers who have a
return ticket may not be denied boarding at the return journey if they did not use their ticket for the outward
journey.
As a result of the regulatory and legislative framework in which they operate, airlines registered in an EU
Member State or which operate in the EU, including the Group, may incur significant increases in costs in the
future in connection with cancelled or delayed flights. This could have a material adverse effect on the
Group’s business, financial condition and results of operations.
The Group is subject to regulatory measures restricting the emission of greenhouse gases, which in the
future could restrict airline operation and increase costs.
Pursuant to the United Nations Framework Convention on Climate Change and the Kyoto Protocol, the parties
thereto have undertaken to control and reduce the emission of greenhouse gases. In order to meet its
obligations under international law, the EU enacted the EU emissions trading system (“ETS”) by Directive
2003/87/EC in 2003, which applied from 1 January 2005.
Directive 2008/101/EC (the “Directive”) amending Directive 2003/87/EC extended the scope of the ETS to
aviation activities. From 1 January 2012, all flights arriving at or departing from airports situated in the
territory of an EU Member State are generally covered by the ETS. The aircraft operators, as defined in the
Directive, are listed in Regulation (EC) No 748/2009, as subsequently amended. The Directive has been
implemented into Italian law by way of Legislative Decree no. 257 dated 30 December 2010. Under the
Directive, each aircraft operator must surrender a number of allowances equal to the total emissions produced,
duly notified and certified during the preceding calendar year from its aviation activities by 30 April each
year. Administrative sanctions (up to the interdiction at European level) apply to air carriers in breach of such
obligations.
For each year of the current trading period (2013-2020), this quantity is reduced to the equivalent of 95% of
the historical aviation emissions. As a consequence of the reduction of the total quantity of allowances, the
number of allowances to be allocated free of charge to aircraft operators (in the current trading period 82% of
all allowances allocated, with 3% being held in a special reserve for fast growing aircraft operators and new
entrants in the market) will be equally reduced. The applicable reference parameter for the allocation of
allowances free of charge for the period from 1 January 2013 to 31 December 2020 is of
0,000642186914222035 allowances per ton-kilometre. The percentage of allowances auctioned in the current
trading period is equal to 15% of all allowances allocated. In order to tackle the structural supply-demand
imbalances, which are expected to continue, the Environment Commission of the European Parliament has

EMEA 100217621 v16                                     9