Corporate governance report 2019

Corporate governance refers to the decision-making systems through which shareholders, directly or indirectly, govern Nordic Iron Ore AB (publ).

Corporate governance at Nordic Iron Ore is based on Swedish legislation, mainly the Swedish Companies Act, and the company’s Articles of Association, as well as internal instructions prepared and adopted by the company.

The Swedish Corporate Governance Code (the Code) applies to Swedish limited liability companies whose shares are traded on a regulated market. It aims to constitute guiding rules for sound corporate governance and supplement legislation in areas in which it places more stringent demands. The company’s shares have been admissible for trading on Nasdaq First North Growth Market since 1 October 2018. Since this trading venue is not on a regulated market, the company is not required to apply the Code. However, the company’s aim is to gradually apply measures to comply with the rules of the Code at a rate deemed reasonable based on the stage and scope of the operations.

The company has appointed Wildeco Ekonomisk Information AB as its Certified Advisor in order to fulfil the requirements for listing on Nasdaq First North Growth Market.

The share
The share capital at the end of the financial year totalled SEK 51,974,081 distributed among 29,969,470 shares, with a quotient value of SEK 1.734 per share.
The company’s Articles of Association stipulate a share capital of not less than SEK 34,000,000 and not more than SEK 136,000,000, and a maximum number of shares totalling 76,000,000. No limitations apply to the transferability of shares under the Articles of Association or applicable legislation. At the 2019 AGM, a resolution was passed to authorise the Board to issue financial instruments with or without pre-emptive rights for existing shareholders. According to the authorisation, issues may in total comprise such a maximum amount of shares, convertibles and/or warrants that falls within the limits of the Articles of Association.

Shareholders and general meetings of shareholders
Nordic Iron Ore’s highest decision-making body is the general meeting of shareholders, at which the latter exercise their influence over the company. Each year, an ordinary shareholder meeting shall be held — an Annual General Meeting (AGM). The AGM passes resolutions on items including adopting the income statement and balance sheet, appropriation of the company’s profit or loss, discharging the Board of Directors and Managing Director from liability, election of the Board and auditors and establishing their fees.

Under Nordic Iron Ore’s Articles of Association, general meetings of shareholders can be held in the municipality of Ludvika, the intended location of the company’s main operations, or in the municipality of Stockholm. Notice of AGMs and Extraordinary General Meetings (EGMs) at which an amendment to the Articles of Association will be addressed must be issued not earlier than six weeks and not later than four weeks prior to the meeting. Notice of any other EGM must be issued not earlier than six weeks and not later than two weeks prior to the meeting. Notice of the meeting is given in the form of an announcement in Post och Inrikes Tidningar and on the company’s website. Information about the notice having been issued is announced in Dagens Industri. Shareholders who are entered in the register of shareholders held by Euroclear, on the record day, and who have notified the company in time of their intention to participate in the meeting are entitled to participate and vote for their shareholdings at the general meeting.

The 2019 AGM was held on 22 May at Kajkrogen restaurant in Ludvika, Sweden. The report from the AGM is published on the company’s website. The AGM resolved to re-elect Board members Jonas Bengtsson, Gösta Bergman and Tomas Olofsson, and to elect Timo Lindborg as a new member. Tomas Olofsson was also elected Chairman of the Board.

Nomination Committee
The AGM resolved that the Nomination Committee be appointed by the Chairman of the Board contacting at least three of the largest shareholders at the end of 2019, in order for these to appoint one representative each who, together with the Chairman, would form a Nomination Committee. The Nomination Committee appoints its Chairman from among its members.

The Board of Directors and its work procedures
The Board is responsible for Nordic Iron Ore’s organisation and for the administration of the company’s affairs. The Board regularly assesses the company’s and Group’s financial position and ensures that the company’s organisation is structured such that accounting, asset management and the company’s financial circumstances in general are appropriately controlled. The Board is elected for the period until the next AGM.

According to the Articles of Association, the Board is to comprise between three and ten members with not
more than ten deputies. The Board of the company currently consists of four Board members and no deputies.

The Board of Nordic Iron Ore comprises expertise and experience in areas that are important to the company. The Board consists of members with expertise and experience in management, business development in the mining industry and financing.

Board work is conducted based on prevailing legislation, regulations and the rules of procedure adopted by the Board. The rules of procedure are regularly reviewed and adopted, at least once a year, at the statutory Board meeting following the AGM.

For the time being, the Board has resolved to refrain from appointing any committees within the Board, since it is of the opinion that, at the current stage of the company’s development, the duties that would be performed by remuneration and audit committees are handled most efficiently within the framework of the Board as a whole.

According to the rules of procedure, the Board is to hold at least six meetings in addition to the statutory meeting. In 2019, the Board held ten meetings including telephone meetings at which minutes were taken. At its ordinary meetings, the Board addressed the fixed items on the agenda of each Board meeting pursuant to the Board’s rules of procedure, such as the Managing Director’s report on significant events since the previous meeting and financial reports.

The Board is kept informed of the company’s financial position and performance, at a minimum in connection with each ordinary Board meeting. Financial reporting to the Board follows the adopted financial reporting instructions.

The current rules of procedure, financial reporting instructions and the delegation of authority were adopted by the Board on 22 May 2019.

Information about the Board and senior executives is available on the company’s website under the heading Corporate governance, Articles of Association and information about the Board and senior executives. Information about fees paid to the Board is provided in the notes to the Annual Report.

Managing Director
The Managing Director reports to the Board and bears the main responsibility for operating activities, including personnel, financial and accounting issues, regular contact with the company’s stakeholders (such as authorities and the financial market) and for providing the Board with the information required to make well-founded decisions. The distribution of duties and responsibilities between the Board and the Managing Director is regulated by law, the company’s instructions for the Managing Director regarding the distribution of duties between the Board and the Managing Director, and the delegation of authority adopted by the Board. The Chairman of the Board maintains ongoing dialogue with the Managing Director and, if necessary, attends extra Board meetings.

Lennart Eliasson has been Managing Director of the company since September 2018. He was previously the company’s Chief Financial Officer. The Managing Director is presented in more detail on the company’s website under About us/Organisation/Management. Information about remuneration for the Managing Director is presented in the notes to the Annual Report.

Insider register and insider policy
Before listing of the company’s share on Nasdaq First North, the Board of Directors has adopted an information policy that includes rules for managing insider information. The policy regulates procedures for the periods during which people in senior positions and other insiders are not permitted to trade shares or other financial instruments issued by the company.

The auditor reviews the company’s Annual Report and accounts, and the administration of the Board of Directors and Managing Director in accordance with the Swedish Companies Act and generally accepted auditing standards in Sweden.

The 2019 AGM re-elected the company’s auditor Ohrlings PricewaterhouseCoopers AB, with Annika Wedin as auditor-in-charge for the period until the 2020 AGM.

Information for the stock market
Since the company has such a large number of owners, Nordic Iron Ore aims to keep the share market continuously informed about the company’s operations, to ensure that the market’s requirements regarding disclosure and timely information are adequately met. Requirements with respect to the company’s disclosure of information are mainly set forth by law and NASDAQ OMX rules for First North Growth Market.

Nordic Iron Ore AB issues quarterly reports, year-end reports and annual reports, which are disclosed through press releases and published on the company’s