An escape clause has been written into the deal should Italy perform badly at Euro 2008, where they have been drawn in the so-called "Group of Death"."Roberto Donadoni today signed a contract for another two years, as President Giancarlo Abete had announced in the last few days," a statement from the FIGC read.
Talks on Donadoni's contract, which was due to expire in July, were to take place after the tournament.
But constant media speculation prompted negotiations to be brought forward.
The former AC Milan player had agreed to a new deal on 20 May but took time to sign the contract.
The Azzurri play the Netherlands in their Group C opener on Monday and then face Romania four days later and finish off against France on 17 June.
Meanwhile, Gianluigi Buffon will lead Italy at the European Championships after he was named as Fabio Cannavaro's replacement as Azzurri captain.Cannavaro will miss the finals with an ankle injury, though after recovering from surgery he underwent in Vienna yesterday, he will remain with the squad after receiving special dispensation from UEFA to do so.
The Real Madrid defender, who is expected to be out for two months, was replaced by Fiorentina's Alessandro Gamberini in Donadoni's 23-man squad.
Gamberini was thrilled to have been called up, but is sorry it came at the expense of Cannavaro."I'm happy to be here, but at the same time I'm really sorry for what happened to Fabio, who is a fundamental element of this side and our leader," said Gamberini.
"I'm pleased he's staying with us, he will give us the right charge.
"I've not come here expecting to play, but I'll do my best in training to give Donadoni something else to think about."
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