Opera

Principles of Corporate Governance at Opera Software ASA

General Principles

Opera strongly believes that strong shareholder rights create higher firm value, higher profits, higher sales growth, and contributes to lower capital expenditures. As such, Corporate Governance is not just an empty phrase at Opera, but a real tool used in bridging the gap between management and shareholders, ensuring good corporate ethical behavior.

Opera is committed to maintaining high standards of Corporate Governance. Opera’s principles of Corporate Governance have been developed in light of the Norwegian Code of Practice for Corporate Governance (the “Code”), dated 21 October 2009, as required for all listed companies on the Oslo Stock Exchange. Opera views the development of high standards of Corporate Governance as a continuous process and will continue to focus on improving the level of Corporate Governance.

Opera’s Activities

Opera’s vision is to deliver the best Internet experience on any device. This is reflected in Article 3 of the Articles of Association, which reads “The Company’s objective is development, production and sale of software and related services, and engagement in other companies or other similar business activities.” However, reaching this goal is about much more than leading the innovation of Web technologies. Our business is based on close relationships with customers, partners, investors, employees, friends, and communities all over the world — relationships we are committed to by conducting our business openly and responsibly. Our corporate policies are developed true to this commitment.

Equity and dividends

To achieve its aggressive long-term growth targets, it is Opera’s policy to maintain a high equity ratio. The Company will consider paying dividends over the next years in light of the Company’s business model, achieved results and financial position. Dividend payments will be subject to approval by the shareholders at the Company’s annual General Meetings.

Authorizations granted to the Board of Directors to increase the Company’s share capital will be restricted to defined purposes and will in general be limited in time to no later than the date of the next Annual General Meeting. To the extent authorization to increase the share capital shall cover issuance of shares under employee share options schemes and other purposes, the Company will consider presenting the authorizations to the shareholders as separate items.

The Board of Directors may also be granted the authority to acquire own shares. Authorizations granted to the Board of Directors to acquire own shares will also be restricted to defined purposes. To the extent authorization to acquire own shares shall several purposes, the Company will consider presenting the authorization to the shareholders as separate items. Such authority will apply for a maximum period of 18 months, and will state the maximum and minimum amount payable for the shares. In addition, an authorization to acquire own shares will state the highest nominal value of the shares which Opera may acquire, and the mode of acquiring and disposing of own shares. Opera may at any time not hold more than 10% of the total issued shares as own shares.

Equal treatment of shareholders and transactions with close associates

A key concept in Opera’s approach to Corporate Governance is the equal treatment of shareholders. Opera has one class of shares and all shares are freely transferable (with possible exceptions due to foreign law restrictions on sale and offering of securities). All shares in the company carry equal voting rights. The shareholders exercise the highest authority in the Company through the General Meeting. All shareholders are entitled to submit items to the agenda, and to meet, speak, and vote at the General Meeting.

Any decision to waive the pre-emption rights of existing shareholders to subscribe for shares in the event of an increase in share capital will be explained.

In the event of not immaterial transactions between the Company and shareholders, members of the Board of Directors, executive personnel or close associates of any such parties, the Board of Directors will arrange for a valuation to be obtained from an independent third party, unless the transaction requires the approval of the General Meeting.

The Company has an established and closely monitored insider trading policy.

Any transactions the Company carries out in its own shares will be carried out either through the stock exchange or at prevailing stock exchange prices if carried out in any other way.

Freely negotiable shares

Opera has no limitations on the transferability of shares and has one class of shares. Each share entitles the holder to one vote.

General Meetings

Through the General Meeting the shareholders exercise the highest authority in the Company. General Meetings are held in accordance with the Norwegian Code of Practice for Corporate Governance. All shareholders are entitled to submit items to the agenda, meet, speak and vote at General Meetings. The Annual General Meeting is held each year before the end of June. Extraordinary General Meetings may be called by the Board of Directors at any time. The Company’s auditor or shareholders representing at least five percent of the total share capital may demand that an Extraordinary General Meeting be called.

General Meetings are convened by written notice to all shareholders with known addresses no later than 21 days prior to the date of the meeting. Proposed resolutions and supporting information, including information on how to be represented at the meeting, vote by proxy and the right to propose items for the General Meeting, is generally distributed to the shareholders no later than the date of the notice. Proxy forms will include proposal for proxy holder and the possibility to cast votes for each item separately. A final deadline for shareholders to give notice of their intention to attend the meeting or vote by proxy will be set in the notice for the meeting. The Chairman, Vice-Chairman, Chairman of the Nomination Committee, CEO, CFO and the auditor are all required to be present at the meeting in person. The Chairman for the meeting is generally independent. Notice, enclosures and protocol of meetings are available on Opera’s Web site, www.opera.com. The General Meeting elects the members of the Board of Directors (excluding employee representatives), determines the remuneration of the members of the board of directors, approves the annual accounts and decides such other matters which by law, separate proposal or the Company’s articles of Association are to be transacted at the General Meeting. The General Meeting will normally vote separately on each candidate for election for the board of directors, the Nomination Committee and any other corporate bodies to which members are elected by the General Meeting.

Nomination committee

The Nomination Committee consists of three members, all of whom are elected by the General Meeting, and is a body established pursuant to the Articles of Association. Members of the Nomination Committee serve for a two year period, but may be re-elected. Any member who is also a member of the Board of Directors will normally not offer himself or herself for re-election. The task of the Nomination Committee is to propose candidates for election as shareholder-elected members of the Board of Directors and to make recommendations regarding the remuneration of the members of the Board of Directors. Remuneration of the members of the Nomination Committee will be determined by the General Meeting. Please see Opera’s Web site for further information regarding the Nomination Committee.

Composition and independence of the Board of Directors

The Board of Directors has the overall responsibility for the management of the Company. This includes a responsibility to supervise and exercise control of the Company’s activities. The Board of Directors shall consist of 5-10 members, employee representatives inclusive. The proceedings and responsibilities of the Board of Directors are governed by a set of rules of procedure. It is the Company’s intention that the members of the Board of Directors will be selected in the light of an evaluation of the Company’s needs for expertise, capacity and balanced decision making, with the aim of ensuring that the Board of Directors can operate independently of any special interests and that the Board of Directors can function effectively as a collegiate body. The Chairman of the Board of Directors will normally be elected by the General Meeting. Please see Opera’s Web site for a detailed description of the board members, including share ownership. Opera does not have a Corporate Assembly. Pursuant to the Code, at least half of the members of Board of Directors shall be independent of the Company’s management and its main business connections. At least two of the shareholder-elected members of the Board of Directors shall be independent of the Company’s main shareholder(s). If the requirements for independence are not met, Opera will explain the reasons therefore in its Annual Report. The term of office for members of the Board of Directors is two years, but a director may be re-elected.

The work of the Board of Directors

The conduct of the board of directors is following the adopted rules of procedure for the Board of Directors. A specific meeting and activity plan is adopted towards the end of each year for the following period, and normally revisited twice a year. The Board of Directors normally meets eight times a year, once for a two-day meeting, but holds additional meetings under special circumstances. Its working methods are openly discussed. Between meetings, the Chairman and Chief Executive Officer update the board members on current matters. There is frequent contact regarding the progress and affairs of the Company. Each board meeting includes a briefing by one of the functional or department managers of the Company followed by Q&A. The board meetings are a continuous center of attention for the Board of Directors ensuring executive personnel maintains systems, procedures and a corporate culture that promote compliance with legal and regulatory requirements and the ethical conduct of the business. The Board of Directors has further established a Remuneration and Audit Committee. The whole Board of Directors is not acting as the Committee. According to the Code, a majority of the members of the Committee should be independent from the Company. If the requirements for independence are not met, Opera will explain the reasons therefore in its Annual Report. Please see below under the section “Remuneration of the Executive Personnel”, and the Board Rules of Procedure for the tasks to be performed by the Committee.

The Board of Directors annually evaluates its work, performance and expertise, and the report is made available for the Nomination Committee. In order to ensure a more independent consideration of matters of a material character in which the Chairman of the Board of Directors is, or has been, personally involved, such matters will be chaired by some other member of the Board of Directors. Please see Opera’s Web site (www.opera.com) for further information regarding the Rules of Procedure for the Board of Directors and the instructions for its Chief Executive Officer. The Company has also established Rules of Procedures for its Executive personnel.

Risk management and internal control

Opera has established comprehensive internal procedures and systems to mitigate risks and to ensure reliable financial reporting. The Board of Directors carries out an annual review of the Company’s most important areas of exposure to risk and its internal control arrangements. The Annual Report will give an account of the main elements of the internal control and risk handling systems.

Remuneration of the Board of Directors

Remuneration for board members is a fixed annual sum proposed by the Nomination Committee and approved at the Annual General Meeting. All remuneration to the Board of Directors is disclosed in the notes to the Annual Report.

A large number of the Company’s shareholders are international with a different view to some of recommendations in the Code. Hence, some of Opera’s directors carry stock options in the Company, as disclosed in the notes to the Annual Report. This practice will be further limited in the future, but will not be excluded as a tool to enhance interest from particularly international experts and senior executives to join the Board of Directors. Any board member who takes on assignments for the Company in addition to his or her appointment as a board member, will disclose such assignments to the Board of Directors which will determine the appropriate remuneration for the assignment in question.

Remuneration of the executive personnel

A Remuneration and Audit Committee has been established. The Committee shall act as a preparatory body for the Board of Directors with respect to (i) the compensation of the CEO and other members of the Executive Team, (ii) Opera’s corporate governance policies and procedures, and (iii) financial control and oversight of the integrity of the financial statements and disclosures of Opera, which in each case are matters for which the Board of Directors maintain responsibility and decision making.

Details concerning remuneration of the executive personnel, including all details regarding the CEO’s remuneration, are given in the notes to the Annual Report. The Board of Directors assesses the CEO and his terms and conditions once a year. The General Meeting is informed about incentive programs for employees, and pursuant to section 6-11 a) of the Public Limited Companies Act a statement regarding remuneration policies for leading employees will be presented to the General Meeting. The Board of Director’s declaration on the compensation policies of the Executive Team will be included in the Annual Report.

Information and communications

Communication with shareholders, investors and analysts, both in Norway and abroad, is a priority for Opera. The Company’s objective is to ensure that financial markets have sufficient information about the Company to be certain that pricing reflects underlying values. During the announcement of quarterly and annual financial results, there is opportunity for management to answer questions from the Company’s shareholders. Opera also arranges regular presentations in Europe and the USA, in addition to holding meetings with investors and analysts. Important events affecting the Company are reported immediately to the Oslo Stock Exchange in accordance with applicable legislation and recommendations and posted on Opera’s web site.

Take-overs

The Board of Directors endorses the recommendation of the Norwegian Code of Practice for Corporate Governance. The Board has adopted guidelines for possible takeovers.

Auditor

The auditor participates in meetings of the Board of Directors that deal with the annual accounts, and upon special request. Every year, the auditor presents to the Remuneration and Audit Committee a report outlining the audit activities in the previous fiscal year and highlights the areas that caused the most attention or discussions with management, as well as a review of the Company’s internal control procedures, including identified weaknesses and proposals for improvement. The auditor will make himself available upon request for meetings with the Board of Directors at which no member of the executive management is present, as will the Board of Directors upon auditor’s request. The General Meeting is informed about the Company’s use and remuneration of the auditor, and details are given in the notes to the Annual Report.

The Board of Directors has established guidelines in respect of the use of the auditor by the Company’s executive personnel for services other than the audit.