Audit committee

The audit committee consists of three members: Tom Nyman, who serves as its chairman, Eva Lindqvist and Kent Sander. The Board of Directors has adopted provisions requiring that a majority of the audit committee members shall be independent of Transmode and its executive management. In addition, at least one member of the audit committee who is independent of the Company and its executive management shall also be independent of the Company's major shareholders and have auditing or accounting expertise. Each of Eva Lindqvist and Kent Sander is independent of Transmode, its Board of Directors, Transmode's management and its major shareholders. All members have auditing or accounting expertise. No member of the Board of Directors who serves in the executive management may be a member of the audit committee.

The audit committee is responsible for, inter alia:

• assisting in the nomination and election of external auditors and evaluating the audit performance and the independence of the external auditors;
• reviewing the accounting policies for compliance with generally accepted auditing standards, applicable laws and regulations;
• monitoring and reviewing internal controls;
• discussing the effectiveness of the Company's accounting and financial controls, policies for risk assessment and risk management and the scope and focus of the audit work with the external auditors and the executive management;
• meeting with the external auditors at least once a year without the executive management being present; and
• completing other matters assigned to the audit committee by the Board of Directors.

Compensation committee

The compensation committee consists of three members: Kent Sander, who serves as its chairman, Tom Nyman and Torbjörn Nilsson. The Board of Directors has adopted provisions requiring that members of the compensation committee, except for the chairman of the Board of Directors if he/she is a member of the compensation committee, must be independent of Transmode and its executive management. Each of Simon Cornwell, Tom Nyman and Kent Sander is independent of Transmode and its management.

The compensation committee is responsible for inter alia:

• preparing and negotiating matters regarding salaries, bonuses, pensions, severance pay, options and convertibles for the CEO and other members of the executive management who report directly to the CEO;
• presenting a proposal for adoption to the annual general meeting for principles concerning the remuneration and other employment benefits of the executive management; and
• completing other matters assigned to the compensation committee by the Board of Directors.