OF THE RISK COMMITTEE OF THE BOARD OF DIRECTORS OF QUORUM INSURANCE HOLDINGS CORP.
Adopted by the Board of Directors on
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ARTICLE I — PURPOSE
The Board of Directors (the "Board") of Quorum Insurance Holdings Corp., a Delaware corporation (the "Company" ), hereby establishes and sets forth this (this "Charter") of the Risk Committee of the Board (the "Committee").
The Committee is established pursuant to Amended and Restated Bylaws of the Company (as amended from time to time, the "Bylaws") and Section 141(c) of the Delaware General Corporation Law (the "DGCL"), which authorizes the Board to designate one or more committees of the Board and to delegate to such committees such authority as the Board deems appropriate, subject to limitations set forth in the DGCL.
The primary purpose of the Committee is to assist the Board in its oversight of the Company's enterprise-wide risk management
Nothing in this Charter is intended to alter or diminish the responsibilities of any other standing committee of the Board Each such committee retains its respective responsibilities as set forth in its own charter, and this Charter is intended to complement — not supersede — those responsibilities.
ARTICLE II — COMPOSITION
Section 2.1 — Number of Members
The Committee shall consist of no fewer than three (3) members of the Board. The members of the Committee shall be appointed by the Board annually , and each member shall serve until such member's successor is duly appointed and qualified, or until such member's earlier resignation, removal, or cessation of service as a director of the Company. The Board may, in its discretion, appoint additional members to the Committee at any time, provided that the Committee shall at all times consist of no fewer than three (3) members.
Section 2.2 — Independence
Each member of the Committee shall be "independent" as that term is defined under the New York Stock Exchange ("NYSE") Listed Company Manual Section 303A. In determining independence, the Board shall consider all relevant facts and circumstances, including but not limited to any material relationships between the director and the Company or its subsidiaries, affiliates, or significant counterparties. No member of the Committee may be an employee of the Company or any of its subsidiaries or affiliates, and no member may have any relationship with the Company that would impair such member's ability to exercise independent judgment in carrying out the Committee's responsibilities.
Section — Chairperson
The Board shall designate one independent member of the Committee as the Chairperson of the Committee (the "Chairperson"). In the event that the Chairperson is absent from or unable to participate in any meeting of the Committee, the members present at such meeting shall elect a temporary chairperson for such meeting by majority vote of the members present.
Section — Removal and Vacancies
Any member of the Committee may be removed or replaced by the Board at any time, with or without cause, by action of the Board. Vacancies on the Committee, whether resulting from removal, resignation, death, incapacity, or increase in the number of Committee members, shall be filled by the Board. Any member appointed to fill a vacancy shall serve for the remainder of the term of the predecessor member (or, in the case of a vacancy resulting from an increase in the size of the Committee, until the next annual appointment of the Committee following the annual meeting of shareholders), or until such member's earlier resignation, removal, or cessation of service as a director.
ARTICLE III — MEETINGS AND PROCEDURES
Section 3.1 — Frequency
The Committee shall meet at least four (4) times per year, on a quarterly basis, and more frequently as circumstances require. The Chairperson shall have the authority to call additional meetings of the Committee at any time. Special meetings of the Committee may also be called by any two (2) members of the Committee. Meetings may be held in person, by telephone conference, by video conference, or by any other means of communication by which all members participating in the meeting can hear one another, in accordance with the DGCL and the Bylaws.
Section 3.2 — Quorum and Voting
A majority of the members of the Committee then serving shall constitute a quorum for the transaction of business at any meeting of the Committee. Actions of the Committee shall be taken by a majority vote of the members present at a meeting at which a quorum is present. Each member of the Committee shall have one vote. In the event of a tie, the matter shall be referred to the full Board for consideration.
Section 3.3 — Attendance by Non-Members
The Committee may invite members of management and other persons to attend all or any portion of any meeting of the Committee in a non-voting capacity, as the Chairperson deems appropriate.
Section 3.4 — Agenda and Materials
The Chairperson, shall establish the agenda for each meeting of the Committee. Any member of the Committee may request the inclusion of additional items on the agenda by providing notice to the Chairperson in advance of the meeting. Meeting materials, including reports, presentations, memoranda, and other documents relevant to the matters to be considered at the meeting, shall be distributed to members of the Committee in advance of the meeting to the extent practicable, with the goal of providing members with sufficient time to review and consider such materials prior to the meeting.
Section 3.5 — Minutes
The shall attend each meeting of the Committee and shall keep minutes of all meetings of the Committee. The minutes shall accurately reflect the matters discussed, the actions taken, and the votes cast at each meeting, and shall be maintained as part of the permanent corporate records of the Company. Draft minutes shall be circulated to members of the Committee for review and shall be approved by the Committee at a subsequent meeting.
ARTICLE IV — AUTHORITY
Section 4.1 — General Authority
The Committee shall have the authority, to the extent it deems necessary or appropriate, to carry out its purposes and responsibilities as set forth in this Charter. The Committee's authority derives from DGCL § 141(c), which permits the Board to delegate authority to committees of the Board composed of one or more directors. The Committee shall exercise its authority in a manner consistent with the Company's Certificate of Incorporation, Bylaws, Corporate Governance Guidelines, and applicable law.
ARTICLE V — RESPONSIBILITIES AND DUTIES
The Committee shall have the following responsibilities and duties. This list is intended to serve as a guide and is not intended to be exhaustive. The Committee may, in its discretion, undertake such additional activities as it deems necessary or appropriate to fulfill its oversight role.
Section 5.1 — Enterprise Risk Management Framework Oversight
The Committee shall oversee the Company's ERM In discharging this responsibility, the Committee shall:
Review management's processes for identifying, assessing, prioritizing, mitigating, and monitoring risks across the enterprise, including the methodologies, tools, and frameworks employed by management in conducting risk assessments and maintaining the Company's risk register;
Evaluate the adequacy and effectiveness of the ERM Framework, including the organizational structure, policies, procedures, and resources dedicated to enterprise risk management;
Review and evaluate the integration of the ERM Framework with the Company's strategic planning, budgeting, and capital allocation processes; and
Section 5.3 — Operational Risk
The Committee shall oversee the Company's identification and management of operational risks, In discharging this responsibility, the Committee shall:
(a) Review the Company's operational risk management framework, including the policies, procedures, and controls designed to identify, assess, mitigate, and monitor operational risks across the enterprise;
Monitor key risk indicators and key performance indicators related to operational risk, including incident and loss event data, near-miss reporting, and trend analyses;
Receive reports on significant operational risk events, including root cause analyses and corrective action plans; and
Section 5.4 — Regulatory and Compliance Risk
The Committee shall oversee the Company's regulatory and compliance risk
ARTICLE — REPORTING
Section — Reports to the Board
The Chairperson shall report to the full Board on the Committee's activities, findings, and recommendations at each regularly scheduled Board meeting, and not less frequently than quarterly. Reports to the Board shall include, at a minimum:
(a) A summary of key risks discussed by the Committee during the reporting period;
(b) The status of risk mitigation actions and any open action items;
(c) Any significant changes to the Company's risk profile, including new or emerging risks, changes in risk severity or likelihood, and changes in the external risk environment;
(d) Recommendations for Board action, if any, including recommendations regarding the Risk Appetite Statement, the DOA Matrix, or other risk-related policies or frameworks; and
(e) Any other matters that the Committee believes should be brought to the attention of the full Board.
ARTICLE — LIMITATION ON COMMITTEE'S ROLE
While the Committee has the responsibilities and authority set forth in this Charter, it is not the duty of the Committee to plan, manage, or conduct the Company's risk management activities. Management of the Company, including the Chief Executive Officer, the Chief Risk Officer, the Chief Compliance Officer, and the officers and employees of the Company's subsidiaries, is responsible for the day-to-day identification, assessment, management, and mitigation of risk. The Committee's function is one of oversight, and the Committee is entitled to rely on the expertise, integrity, and good faith of the Company's officers, employees, and external advisors in discharging its responsibilities.
ARTICLE — AMENDMENT
This Charter may be amended, modified, or restated by the Board at any time and from time to time, by resolution duly adopted at a meeting of the Board at which a quorum is present or by unanimous written consent of the Board. No amendment to this Charter shall require the approval of the shareholders of the Company unless otherwise required by applicable law or the rules of the NYSE.
ATTESTATION
The undersigned, being the duly appointed General Counsel & Corporate Secretary of Quorum Insurance Holdings Corp., hereby certifies that this of the Risk Committee of the Board of Directors of Quorum Insurance Holdings Corp. was duly adopted by the Board of Directors of Quorum Insurance Holdings Corp. on
QUORUM INSURANCE HOLDINGS CORP.
By: ________
Name: Dennis R. Okonkwo
Title: General Counsel & Corporate Secretary
Date: