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Declaration of compliance

Declaration of compliance pursuant to § 161 German Stock Corporation Act (AktG)

DECLARATION OF COMPLIANCE BY THE ADMINISTRATIVE BOARD WITH THE GERMAN CORPORATE GOVERNANCE CODE

The Administrative Board (Verwaltungsrat) of RIB Software SE declares pursuant to Art. 9 para. 1 lit. c) (ii) of the Council Regulation (EC) no. 2157/2001 of 8 October 2001 on the Statute of a European Company (SE) (the SE-Regulation, „SE-VO”), Sec. 22 para. 6 of the Law for the Implementation of the SE-VO of 22 December 2004 (the Implementation Act, “SEAG”) in connection with. Sec. 161 German Stock Corporation Act (Aktiengesetz) that, RIB Software SE has complied with and will comply with the recommendations of the “Government Commission on the German Corporate Governance Code“ in the version dated 5 May 2015, effective since 12 June 2015, (the „Code“) under consideration of the particularities of the one-tier board system of RIB Software SE described under no. 1 with the exceptions described under no. 2, and to the extent not complied with, why not.

1. Particularities of the one-tier corporate governance system

Pursuant to Art. 43–45 SE-VO in connection with Secs. 20 et. seq. SEAG, the one-tier corporate governance system is characterized by the fact that the guidance of the SE is incumbent upon a uniform body, the Administrative Board, see para. 7 of the preamble of the Code. The Administrative Board directs the Company, establishes the general principles of its business and supervises their implementation by the Managing Directors (Geschäftsführende Direktoren). The Managing Directors manage the business of the Company and represent the Company in dealings with third parties. They are bound by instructions given by the Administrative Board.

RIB Software SE generally applies the recommendations of the Code relating to the Supervisory Board of a German Stock Corporation (Aufsichtsrat) to its Administrative Board and relating to the Management Board of a German Stock Corporation (Vorstand) to its Managing Directors. The following exceptions apply in terms of the statutory rules of the one-tier corporate governance system:

– Deviating from Sec. 2.2.1 sent. 1 of the Code, the Administrative Board submits the financial statements as well as the consolidated financial statements to the general meeting, Sec. 48 para. 2 sent. 2 SEAG.

– Deviating from Secs. 2.3.1 sent. 1 and 3.7 para. 3 of the Code, the Administrative Board is responsible for the convocation of the general meeting, Secs. 48 and 22 para. 2 SEAG.

– The responsibilities of the Management Board set out in Secs. 2.3.2 sent. 2 (proxy-voter bound by instructions), 3.7 para. 1 (opinion to a public take-over offer) und para. 2 (behaviour during a public take-over offer) as well as 3.10 (Corporate Governance report), 4.1.3 (Compliance) und 4.1.4 (risk management and -controlling) of the Code are incumbent upon the Administrative Board of RIB Software SE, Sec. 22 para. 6 SEAG.

– The responsibilities of the Management Board contained in Secs. 4.1.1 (direction of the Company) and 4.1.2 in connection with 3.2 half sentence 1 (development of the strategic direction of the Company) of the Code are incumbent upon the Administrative Board, Sec. 22 para. 1 SEAG.

– Deviating from Secs. 5.1.2 para. 2 of the Code, the Managing Directors, other than the members of the Management Board, are not subject to a maximum term of office, Sec. 40 para. 1 sent. 1 SEAG.

– Deviating from Secs. 5.4.2 sent. 2 and 5.4.4 of the Code, members of the Administrative Board can be appointed as Managing Directors as long as the majority of the members of the Administrative Board consists of non-managing members, Sec. 40 para. 1 sent. 2 SEAG.

2. Deviations from the Recommendations of the Code

– Section 3.8 para. 3 GCGC: The D&O insurance for the members of the Administrative Board does not include a deductible. In the opinion of the Administrative Board, the agreement of a voluntary deductible is neither suitable nor necessary in order to ensure that the members of the Administrative Board duly perform the duties incumbent upon them.#

– Section 4.2.2 para. 2 GCGC: The Administrative Board does not consider, as for which compensation of the Managing Directors is appropriate, the relationship between the compensation of the Managing Directors and that of senior management and the staff overall, nor in terms of its development over time. The Administrative Board does consequently not determine how senior managers and the relevant staff are to be differentiated. The corresponding recommendation of the Code appears to be impracticable and, in addition, not suitable to ensure that the compensation of the Managing Directors is appropriate in each case.

– Section 4.2.3 para. 2 GCGC: The variable remuneration for the Managing Directors does not reflect potential negative developments in such a way that the income might also be subject to real losses. This does not appear necessary in view of the compensation structure for the Managing Directors in order to ensure that the Managing Directors do not take any undue risks when managing the company.

To the extent the Managing Directors receive share options as a variable component of their remuneration, such component is limited with respect to the number of options but not according to amount. Since the exercisability and the value of the options depend on the achievement of ambitious performance targets, a maximum limit according to amount would run contrary to the purpose of this remuneration component to provide a special performance incentive.

The Administrative Board has resolved to propose to the general meeting on 30 May 2017 to amend the authorization to grant subscription rights to the management and to employees of the Company or an affiliated company within the frame of the Stock Option Program 2015. This amendment aims at creating the possibility to amend the conditions of the stock options issued under the Stock Option Program 2015 so that a performance target not achieved in one year cannot only be compensated by achieving the performance target for the directly following year, but also by achieving the respective performance targets for the second or third following year. The Administrative Board holds the view that sticking to the performance targets currently in force would lead to results which do not sufficiently reflect the current situation of the Company. Such amendment of the conditions of the stock options will constitute a (presumably one-time) deviation from the recommendation under Section 4.2.3 para. 2 sent. 8 GCGC which requires that retroactive changes to performance targets or the comparison parameters shall be excluded.

– Section 4.2.3 para. 4 GCGC: The contracts for the Managing Directors do not provide for a severance cap in the event of early termination. Such an arrangement does not appear necessary in addition to the statutory provisions applicable in cases of early termination in order to protect the interests of the company and its shareholders.

– Section 4.2.5 GCGC: The remuneration of the Managing Directors is disclosed in accordance with the statutory provisions. More comprehensive disclosure in a remuneration report, which outlines or itemises the remuneration system for the Managing Directors and the nature of any fringe benefits provided by the company in a manner that goes beyond the statutory requirements does not appear necessary to satisfy the justified information interest of the shareholders and investors to the due extent

– Section 5.1.2 para. 2 GCGC: The Administrative Board has not fixed an age limit for the Managing Directors. Setting an age limit is not in the interests of the company and its shareholders, since there is no compelling connection between a Managing Director's age and his performance.

– Section 5.4.1 paras. 2 and 3 GCGC: With the exception of the determination of target quotas for the portion of women among the members of the Administrative Board, the Administrative Board does not specify concrete goals for its composition and does not publish them and the status of their implementation in the Corporate Governance report. The Administrative Board is of the opinion that in its composition, due attention should be paid in particular to the company-specific situation, the company's international activity, potential conflicts of interest, diversity and an adequate involvement of women and shall also bear this in mind in its proposals to the responsible electoral bodies. However, the Administrative Board should in each case be optimally staffed. The specification of concrete goals for its composition, further to those required under mandatory law, would appear neither suitable nor expedient to achieve this.

The Administrative Board does not set a general limit for the length of membership in the Administrative Board. Setting a limit for the length of membership in the Administrative Board is not in the interest of the company and its shareholders, since there is no compelling connection between the term of service on the Administrative Board and the occurrence of conflicts of interests or the independence of the board members.

– Section 5.4.1 para. 4 GCGC: The Administrative Board does not disclose the personal and business relations of each candidate with the enterprise, the bodies of the company and any shareholder having a significant share in the company when making its election proposals. The recommendation of the Code implies more than merely insignificant legal risks; hence, to comply with it, is not in the interest of the company.

In case of doubt, the German version of this declaration shall be binding.


Stuttgart, this April 2017


RIB Software SE

The Administrative Board