Rules of Procedure for the Board of Directors of Opera Software ASA
(Adopted at a board meeting held 18 September 2017)
1. The purpose of these Rules of Procedures is to lay down rules on the work and administrative procedures of the Board of Directors of Opera Software ASA (the "Company"). Pursuant to § 6-23 of the Public Limited Companies Act and the Norwegian Code of Practice for Corporate Governance (the “Code”), the Company has an obligation to adopt Rules of Procedure with respect to the Board of Directors.
2. To the extent permitted by law, the Board of Directors, with simple majority, can decide to make exceptions from these Rules of Procedure.
II RESPONSIBILITIES OF THE BOARD OF DIRECTORS
1. Pursuant to § 6-12 of the Public Limited Companies Act, the Board of Directors is responsible for the management of the Company. The responsibilities of the Board of Directors of include the following:
a. The Board of Directors shall ensure that the Company's business activities are soundly organized.
b. The Board of Directors shall supervise the Company's day-to- day management.
c. The Board of Directors shall draw up plans and budgets for the Company's activities.
d. The Board of Directors shall keep itself informed of the financial position of the Company and shall be responsible for ensuring that the Company's activities, accounts and asset management are subject to adequate control.
e. The Board of Directors shall initiate such examinations as it finds necessary for the performance of its duties. The Board of Directors must initiate such examinations if so demanded by one of its members.
f. The Board of Directors shall appoint the Company's Chief Executive Officer and approve his/her terms of employment, taking into consideration recommendations made by the Remuneration and Audit Committee.
g. The Board of Directors shall review the Chief Executive Officer's statements on the Company's activities, positions and profit/loss development.
h. The Board of Directors shall review and approve the Company's annual accounts, and issue an annual directors' report as required by § 3-1 of the Accounting Act.
i. The Board of Directors shall monitor the level of the Company's equity. If the equity is lower than can be deemed sound, the Board of Directors shall take immediate action. Within a reasonable period of time, the Board of Directors shall call a general meeting, give the general meeting an account of the Company's financial position and propose measures to provide the Company with a sound equity. The same shall apply if it must be assumed that the equity of the Company has been reduced to less than half the share capital, in which case a general meeting must be called within six months.
j. Authorize capital expenditure and divestments in line with the policy for delegation of authority as approved by the Board of Directors from time to time.
k. Make decisions in other cases involving financial dispositions that are major in relation to the Company’s operations, or which fall outside the strategy or the business plans previously approved by the Board of Directors.
l. The Board of Directors shall consider all matters of an extraordinary nature or of major importance to the Company.
m. The Board of Directors plans to carry out a self-evaluation annually to determine whether it and its committees are functioning effectively, and such evaluation will be discussed and considered by the Board of Directors in its consideration of any appropriate action or response. Any report from such self-evaluation report will upon request be made available to the Nomination Committee.
n. The Board of Directors shall review and approve not immaterial transactions within the Company or with companies in which a director or leading employee of the Company or close associates of these have a material direct or indirect vested interest.
o. The Board of Directors shall, in the event of not immaterial transactions between the Company and shareholders, a shareholders parent company, members of the Board of Directors, executive personnel or close associates to any such parties, arrange for a valuation to be obtained from an independent third party, unless the transaction requires approval from the General Meeting.
p. The Board of Directors shall consider all matters related to and have the overall responsibility for Corporate Governance in the Company and ensure that the Company implements sound Corporate Governance, ref. also Rule X 4.f. below.
q. The Board of Directors shall establish guidelines with respect to the use of the auditor by the Company’s executive personnel for services other than audit, ref also Rule X 5.d below.
2. In its supervision of the business activities of the Company, the Board of Directors will ensure that:
a. The Chief Executive Officer uses proper and effective management and control systems, including systems for risk management, which continuously provide a satisfactory overview of the Company’s risk exposure.
b. The control functions work as intended and that the necessary measures are taken to reduce extraordinary risk exposure.
c. There exist satisfactory routines to ensure follow-up of principles and guidelines adopted by the Board of Directors in relation to ethical behavior, conformity to law, health, safety and working environment, and social responsibility.
d. The Company has a proper internal auditing system, capable of producing reliable annual reports.
e. Directives from the external auditor are obeyed and that the external auditor’s recommendations are given proper attention.
III ADMINISTRATIVE PROCEDURES
1. The Board of Directors shall at least once a year adopt schedules for board meetings to be held during the next year.
2. The Chairman, or in his absence the Deputy Chairman (if the Board of Directors has a Deputy Chairman) or the Chief Executive Officer, shall convene the Board Meeting according to the schedule, or as they otherwise find necessary or desirable.
3. Each member of the Board of Directors and the Chief Executive Officer may demand that a board meeting be convened to discuss specific matters.
4. Board meetings shall normally be convened by at least seven days' prior written notice. The notice shall include an agenda of the meeting and such documents which may be necessary to give the Board of Directors satisfactory grounds on which to base its discussion. However, the Chairman may, if necessary, decide to convene board meetings by telephone and/or by shorter notice and/or to distribute relevant documents after the notice has been sent.
5. A member who is unable to attend a board meeting shall notify the Chairman or the Chief Executive Officer as soon as possible. Upon receiving such notice the Chairman and/or Chief Executive Officer shall, if applicable, give notice to an alternate member of the Board of Directors to participate in the meeting.
6. The Board of Directors shall normally deal with matters at meetings. The Chairman may, however, decide that the Board of Directors shall deal with a matter by way of a telephone meeting, video conference, or in writing. However, (i) each member of the Board of Directors and Chief Executive Officer may always demand that a question be discussed at a meeting, and (ii) the Company's annual accounts and the directors' report shall always be discussed and approved at a meeting where a quorum is physically present.
7. Board meetings shall be chaired by the Chairman, or in his/her absence, by the Deputy Chairman (if the Board of Directors has a Deputy Chairman). If neither of these is present, the Board of Directors shall elect a chairman for the meeting.
8. The directors will meet regularly in an executive session without management participation. In addition, if the Board of Directors includes a member who is not deemed to be “independent” of the management, the other members will meet in an executive session at least once annually
IV QUORUM - MAJORITY REQUIREMENTS
1. The Board of Directors constitutes a quorum if more than half of its members are present or participate in the discussion of the matter in question. In this respect, any member who is deemed to be disqualified (see Rule 5) shall not be regarded as being present.
2. The adoption of a resolution by the Board of Directors shall require that the majority of the members who have participated in the discussion of the matter have voted in favor of the proposal. In the event of a parity of votes, the Chairman shall have the casting vote. More than one third of all members of the Board of Directors must vote in favor of a proposal involving change.
3. In connection with elections or appointments, the person who achieves the highest number of votes shall be regarded as elected or appointed. The Board of Directors may decide in advance that a new vote will be held if none of the candidates achieves a majority of the votes cast.
4. In the event of a parity of votes in connection with the election of the Chairman, the Deputy Chairman (if the Board of Directors has a Deputy Chairman) or a chairman of a board meeting, the election shall be decided by lot. In other cases of parity of votes, the chairman of the meeting shall have the casting vote.
1. A board member may not participate in the discussion or decision of issues which are of such special importance to such board member or to any related person (as defined in § 1-5 of the Public Limited Companies Act) of the board member that he/she must be regarded as having a major personal or financial special interest in the matter.
2. A board member may not participate in the discussion of a matter concerning a loan or other credit to himself/herself or on the furnishing of security for his/her debt.
3. The rest of the Board of Directors may decide whether there exist such significant special interests that can be deemed to constitute a conflict of interest on the part of a member. Otherwise, the members shall judge their own competence.
VI MINUTES OF BOARD MEETINGS
1. The Chief Executive Officer shall ensure that minutes are kept of the proceedings of the Board of Directors.
2. The minutes shall, at a minimum, state the time and venue of the board meeting, the participants and a confirmation that the participating members constitute a quorum, the proceedings and the resolutions adopted by the Board of Directors. If a resolution is not unanimous, it shall be stated who voted for and who voted against.
3. If a member of the Board of Directors or the Chief Executive Officer disagrees with a resolution, he/she may demand to have his/her view entered in the minutes.
4. Drafts minutes shall be distributed to all members of the Board of Directors. Unless otherwise decided by the Chairperson of the Board of Directors, the minutes shall be approved and signed at the next board meeting. The minutes shall be signed by all members who participated at the meeting. If a resolution has been adopted at a meeting, the Board of Directors may however elect two members to sign the minutes, in which case a copy must be sent to all members with a deadline for comments.
VII THE BOARD OF DIRECTORS' RELATIONSHIP WITH THE GENERAL MEETING
1. The Board of Directors shall call the annual general meeting of the Company, which shall be held not later than six months after the end of each financial year.
2. The Board of Directors may at any time decide to call an extraordinary general meeting.
3. The Board of Directors shall call an extraordinary general meeting if so demanded by the Company's auditor or shareholders representing at least five percent of the total share capital. The Board of Directors shall ensure that the general meeting is held within one month of the demand being made.
4. The Board of Directors shall be responsible for the preparation of matters which are to be considered by the general meeting.
5. The Chairman shall be present at the Company's general meetings. The other members of the Board of Directors have the right to be present at and speak at the Company's general meetings.
6. The Board of Directors shall consider and may decide to allow electronic participation in General Meetings.
VIII DUTIES OF THE CHIEF EXECUTIVE OFFICER
1. The duties of the Chief Executive Officer in relation to the Board of Directors shall be laid down in the Instructions for the Chief Executive Officer.
IX DUTY OF CONFIDENTIALITY
1. Members of the Board of Directors shall treat as confidential all non-public information and documents received from the Company in their capacity as board members and all non-public information as to the proceedings of the Board of Directors. The members shall take the necessary steps to ensure that no unauthorized persons gain access to such information. The Board of Directors may decide to make exceptions from this duty of confidentiality.
2. Members of the Board of Directors shall not make any statements to the public or to unauthorized persons regarding matters which are dealt with by the Board of Directors and which are not publicly known.
3. Upon retiring from the Board of Directors, a member shall return or destroy (as the Board of Directors may instruct) all documents of a confidential nature received from the Company.
X AUDIT COMMITTEE AND REMUNERATION COMMITTEE
1. The Board of Directors shall establish a Audit Committee and a Remuneration Committee, respectively (the “AC” and the “RC”, respectively and each of them referred to as a ”Committee”). The members of the Committee shall be appointed by and among the members of the Board of Directors.
2. Each Committee shall consist of between 2 or 3 members. Leading employees of the Company cannot be appointed as members of a Committee. Each Committee shall have a competence which, based on the Company’s business and organization, is necessary in order for the Committee to conduct its tasks. In both Committees, at least one member shall be independent from the management and in the AC at least one member shall possess qualifications within accounting or audit services.
3. The RC shall act as a preparatory body for the Board of Directors with respect to (i) the Total Compensation (defined as compensation, benefits and perquisites) of the Chief Executive Officer and other members of the Executive Team, and (ii) the Company’s corporate governance policies and procedures. The AC shall act as a preparatory bode for the Board of Directors with respect to financial control and oversight of the integrity of the financial statements and disclosures of the Company. In each case the Board of Directors shall maintain responsibility and decision making.
4. With respect to the RC, the Committee shall:
a. Review corporate and individual goals and objectives relevant to the Chief Executive Officer’s Total Compensation, and evaluate the Chief Executive Officer’s performance relative to those goals and objectives, and a proposal for the Chief Executive Officer’s Total Compensation level based on this evaluation.
b. In making a proposal for the long-term incentive component of Chief Executive Officer’s Total Compensation, the Committee will consider the Company’s performance, relative shareholder return, the value of long-term incentive compensation given to Chief Executive Officers at comparable companies, and the awards given to the Chief Executive Officer in past years.
c. The Committee will review and advise on proposals made by the Chief Executive Officer with regard to the Total Compensation of members of the Executive Team.
d. When fulfilling its responsibilities in relation to Total Compensation for the Chief Executive Officer and members of the Executive Team, the Committee will consider the Total Compensation of all levels of employees within Opera, in order to provide an appropriate context for making decisions at the Chief Executive Officer and members of the Executive Team levels.
e. The Committee will make recommendations to the Board of Directors with respect to incentive compensation and equity-based incentive plans that require shareholder approval, and will act as a preparatory body for the Board of Directors in the management of shareholder-approved award and options plan(s).
f. The Committee will review and assess on a regular basis the Company’s Corporate Governance policies and procedures, including policies embodied in these Rules of Procedure and applicable Corporate Governance Guidelines (such as the Code), and will recommend any proposed changes to the Board of Directors for approval. When reviewing and making recommendations with respect to the Company’s Corporate Governance policies and procedures, the Committee shall take into consideration changes in Norwegian corporate law, applicable stock exchange listing standards, the Code and such other changes in Norwegian best practices.
g. The Committee will assist the Board of Directors with its annual evaluation of the Board of Directors, its committees and the Company’s management.
h. Other duties and responsibilities may be assigned to the RC, from time to time, by the Board of Directors.
5. With respect to the AC, the Committee shall:
a. Prepare the Board of Directors’ maintenance and review of the process for reporting on financials.
b. Review and monitor the systems for internal control and risk management, as well as the Company’s internal audit (if such is established).
c. Keep on-going contact with the Company’s auditor with respect to the audit of the annual accounts.
d. Assess and monitor the auditor’s independence, cf. chapter 4 of the Auditors Act, including to what extent services other than audit are delivered by the auditor or the auditor firm constitute a threat to auditor’s independence.
6. Decision making authority shall remain with the Board of Directors and shall not be delegated to either of the Committees.
7. Each Committee shall meet as often as it deems appropriate and necessary. Each Committee will meet when called by the Committee chairperson or by two members or when requested by the chairperson of the Board of Directors or the Chief Executive Officer. A quorum is formed if more than half of the members (which must always include the chairperson of the Committee) are participating.
8. Each Committee elects its chairperson by simple majority
9. Each Committee shall prepare minutes and shall report to the Board of Directors on a regular basis. The report to the Board of Directors shall contain recommendations for the Board of Directors.
10. The Board of Directors may decide to appoint other sub-committees.
XI BOARD CODE OF CONDUCT
1. The Board of Directors shall approve a code of conduct. Each member of the Board of Directors shall annually sign a confirmation that they have read and will comply with the code of conduct.