Infratek ASA s Corporate Governance policy

Infratek ASA s Corporate Governance policy The purpose behind Infratek ASA s governance structure is to contribute to long-term value creation, and to ensure that owners and other interested parties have confidence in the Board of Directors and management. Infratek s reporting complies with the Norwegian Code of Practice for Corporate Governance 1, with a few exceptions as explained in this policy, and adheres to Infratek s articles of association, business idea, strategy, and the laws and regulations applicable to Norwegian stock-exchange listed companies. 1 Purpose and principles of corporate governance Infratek s corporate governance principles, discussed in this document, are intended to ensure value creation for the Group s shareholders, employees, and other interested parties, and to ensure equal treatment of shareholders. Additionally, their purpose is to reinforce confidence in the Group and to clarify the roles and responsibilities of shareholders, the Board of Directors, and executive management. It is the Board s responsibility to ensure that the company maintains good corporate governance. The Board shall give an overall presentation of the company s corporate governance in Infratek s annual report which covers every section in the Norwegian Code of Practice. Any deviations from the Norwegian Code of Practice for Corporate Governance shall be explained. 1.1 Infratek s ethical guidelines Infratek complies with Norwegian law in all its activities, and the laws applicable in those countries which Infratek has operations. In addition, the Group has prepared ethical guidelines that are approved by the Board, which builds upon the Group s corporate values. The details of Infratek s adherence to these guidelines and to the Group s corporate governance policy are put forward on Infratek s website: www.infratek.no and annual report. 1.2 Infratek s relations with interested parties Infratek s relations with interested parties, such as shareholders, customers, employees, suppliers, or society at large, shall be based on the Group s business purpose and strategy. Shareholder matters are presented in item 4. 1 The Norwegian Code of Practice for Corporate Governance dated 21 October 2009 was prepared by NUES, the Norwegian committee for corporate governance (www.nues.no). The Code will be updated regularly by NUES. NUES was established by the following organizations, which support its recommendations: Norwegian Shareholders Association, Norwegian Institute of Public Accountants, Institutional Investor Forum, Norwegian Financial Services Organization, Norwegian Society of Financial Analysts, Confederation of Norwegian Business and Industry, Norwegian Association of Private Pension Funds, Oslo Stock Exchange/Oslo Børs, and Norwegian Mutual Fund Association. 1

1.2.1 Customers Infratek s customers are the basis for the Group s growth, and good customer relations are vital to Infratek s future. Infratek must ensure good customer dialogue via accessible and service-oriented customer service staff. 1.2.2 Employees Ultimately, Infratek s growth and development depend on its employees efforts, which also ensure the Group s profitability and growth. The Group must ensure that employees have a good working environment, attractive working conditions, and good opportunities for personal and career development. 1.2.3 Suppliers Infratek seeks to maintain good business relationship with the Group s suppliers of goods and services. Infratek intends to continually improve its procedures so as to secure long-term cooperation with the Group s suppliers, on competitive terms and conditions. 1.2.4 Society By building, operating and securing critical infrastructure, and running profitable businesses in which employees can develop and grow, Infratek shall solidify its reputation and contribute to society. Infratek seeks to conduct itself as a responsible corporate citizen. Thus, the Group will support certain deserving social and community activities, which are considered consistent with Infratek s business activities. In its annual report, Infratek will provide a summary of its activities within the area of corporate social responsibility. 2 Business Infratek ASA is a leading supplier of services related to building, operating and securing critical infrastructure; energy carriers, telecom, public transport and security solutions. The company has operations in Norway, Sweden and Finland. The Infratek Group has a growth strategy with growth ambitions in the Nordic area. Infratek shall continue to develop its Nordic market position to strengthen it s attractivity both among customers, employees, shareholders and the society in general. The business purpose and business idea of Infratek is supporting this strategy. 2.1 Infratek s business purpose Infratek s business purpose, as set forth in Section 3 of the company s articles of association is as follows: The object of the company is to conduct business related to contractor- and operation services, installation, security and guarding, electrical security and other activities related thereto. The business may also be conducted through participation in, or cooperation with, other companies. 2

2.2 Infratek s vision, corporate mission and core values The Group s vision, corporate mission and core values are: Vision: Together we shall deliver and become a leading Nordic player. Corporate mission: We build, operate and secure critical infrastructure. Core values: Presence Job satisfaction Adaptability These are supported by the following goals and strategic priorities: Satisfied and loyal customers. An attractive employer through professional and personal growth and respect for each employee. Innovative and adaptable to a market in change. A profitable industrial growth player both organic and structural. The Nordic region as a market. 2.3 Infratek s articles of association, reports to shareholders, and stock-exchange notices The company s articles of association, quarterly and annual reports, and notices submitted to the Oslo Børs (Oslo Stock Exchange) for release to the investment community are available on the Group s website: www.infratek.no 3 Equity and dividends 3.1 Equity The company s equity should not exceed what is necessary to ensure proper development of the company s values. The equity shall at all times be tailored to the company s goals, strategy, and risk profile, and should be sufficient for the company to satisfy current loan agreement covenants. 3.2 Dividend It is a goal for Infratek to provide shareholders with a competitive yield on their investments compared with alternative investments with similar risk profiles. Such a yield is sought through a combination of value growth and dividend payments. Infratek s objective is to maintain a dividend that over time is within 30 percent to 50 percent of profit after tax adjusted for any non-cash generating items. When determining the dividend, the Board of Directors will take into consideration Infratek s expansion opportunities, liquidity and overall financial situation. 3

3.3 Board authorization for capital increases The General Meeting may give the Board on behalf of Infratek ASA authorization, under Section 10-14 of the Norwegian Public Limited Liability Companies Act, to increase the company s share capital. The highest nominal value according to the authority will be limited to 50 percent of the share capital at the time the authority was registered in the The Brønnøysund Register Centre. Any authorizations granted to the Board of Directors to increase Infratek ASA s share capital are to last only until the company s next annual general meeting. A summary of Board authorizations for capital increases are accessible via the company s website: www.infratek.no. Any power of attorney to issue new shares deviate from the Norwegian Code of Practice for Corporate Governance, and will be approved to complete acquisitions which support the Group s growth strategy and for use in share-related incentive arrangements directed towards employees. Each of the purposes of the new share issues shall be seeked treated individually at the General Meeting. 3.4 Board authorization to purchase own (treasury) shares The general meeting may give the Board authorization under Section 9-4 of the Norwegian Public Limited Liability Companies Act, compared with Section 9-2 and 9-3, on behalf of Infratek ASA to acquire Infratek ASA shares. The highest nominal value of shares that can be acquired under the authorization is limited to 10 percent of the company s share capital. Board authorisations to acquire own shares shall not be provided for a time period longer than to the upcoming ordinary general meeting. Any Board authorizations to purchase treasury shares are found on the company s website: www.infratek.no. 4 Equal treatment of shareholders and transactions with related parties Infratek strives to treat its shareholders equally. 4.1 Shareholders Infratek has one share class. The shares par value is NOK 5.00. Shareholders exercise their rights primarily through participation in and voting at the company s general meetings. Equal treatment of shareholders is a fundamental principle, meaning that the amount of an individual shareholder s control should correspond with the amount the shareholder has placed at risk financially. Hafslund ASA owns 43.3 precent and the Fortum Group 33.0 percent of the shares in Infratek ASA. Hafslund and Fortum hence represent related parties to Infratek. The remaining shares are freely traded at the Oslo Børs. The most recent description of Infratek s shareholder structure is available at Infratek s website: www.infratek.no. 4

4.1.1 Equal treatment of shareholders and protection of minority shareholders Equal treatment of shareholders is fundamental for stock-exchange listed companies. Equal treatment is ensured by having investors receive equal and simultaneous access to information and by making sure shareholders are able to participate according to their ownership in share issues, etc. unless unequal treatment is substantiated. The company s transactions in its own shares are to be conducted via the stock exchange or by other means, at listed prices. The requirement for equal treatment shall be ensured in other ways when there is limited liquidity in the share. Infratek strives for equal treatment of its shareholders in all its communications. 4.2 Transactions with related parties Transactions with related parties are to be conducted at arm s length. The same principle applies to transactions between companies within the same group where there are minority shareholders. Any transactions with related parties that are regarded as significant are to be presented in the company s annual report. Subsidiaries of Hafslund ASA and Fortum Oyj are important customer groups of Infratek, and there are a number of related party agreements between the majority owners; Hafslund ASA and Fortum Ojy including subsidiaries, and Infratek. The Board shall consider the preparation of a valuation by an independent third party if material transactions, which are not part of normal business activities, between the company and shareholder(s), member of Board, leading personnel or related parties of any of these are to be entered. Transactions between companies within the same group, where a minority shareholder is involved, shall be handled in a similar way. This may be deviated from if the concern is presented for the General Meeting following the regulations of Norway s Public Limited Liability Companies Act. Board members and leading personnel, or related parties of these, are to notify the Board if they have significant interests, whether direct or indirect, in agreements entered into by the company. 4.3 Significant shareholder matters Infratek has entered a loan agreement with a larger Norwegian bank. Entering of a loan agreement requires covenants related to the company s operations and ownership structure. 5 Freely negotiable shares Subject to the restrictions provided for by law, Infratek s shares can be transferred and acquired freely. 6 General meetings General meetings are Infratek ASA s highest decision-making body. At the general meeting, issues, including modifications to articles of association, approval of the annual accounts and annual report, and dividend disbursements, are discussed and decided, as required by 5

Norwegian law. Under Norwegian law, annual general meetings must be held no later than the end of June. In setting up and running the Group s general meetings, Infratek is to ensure that all shareholders: Are given ample notice of the meeting. Notice of the general meeting, including any supporting information on resolutions to be considered at the meeting and the recommendations of the nomination committee, shall be made available at the company s website at the latest 21 days prior to the general meeting. Infratek shall distribute the general meeting notice, including any supporting information on resolutions to be considered at the meeting and the recommendations of the nomination committee, to all shareholders of record within 21 days prior to the date of the general meeting (pursuant to Section 5-10 (2)). The notice shall provide an introduction to the procedures shareholders have to follow to be able to attend and vote at the general meeting. The registration deadline (by which shareholders must give notice of their intention to attend) shall be set as close to the date of the general meeting as possible. The Group shall also strive to submit supporting documentation at the same time as the meeting notification, and to ensure that supportive documentation provides sufficient information for shareholders to take a position on all issues to be presented to the general meeting. Are provided the right to get a question considered at the general meeting when the question is reported to the Board of Directors within seven days prior to the deadline for the notice of the general meeting. The request must include an explanation for why the question shall be put on the agenda or a proposal for resolution. Are afforded the opportunity to participate in and vote at the general meeting without undue expense. The shareholders are provided the possibility to vote by proxy. Infratek shall: i) provide information about how to vote by proxy, ii) appoint a person who may vote on behalf of the shareholders as a proxy and iii) compile power of attorney scheme, which if possible, is compiled in such a way that each case and person may be voted for individually. Are assured that representatives from the Board, nomination committee, and auditor are present at general meetings. Are afforded impartial meeting chairs for general meetings. Are given an overview of the authorizations granted by the general meeting to the Board of Directors. Seek to arrange for so that the general meeting is enabled to vote on each of the candidates to duties within the company s corporate governance structure, among other the board of directors and the nomination committee. The actual owner of agent managed shares is provided meeting and voting rights at the general meeting, either by oneself or by proxy, given that the ownership is sufficiently documented and reported to the account operator within 12.00 am the day before the general meeting is held. Shareholders have the right to get cases heard at the general meeting. Proposal to resolution or comments to cases where no resolution is provided, together with letter of attorney shall, when possible, be provided at the website of Infratek. Meeting notifications 6

and minutes of general meetings shall further be made available on Infratek s website: www.infratek.no. 7 Nomination committee Infatek ASA shall have a nomination committee whose members are elected by the general meeting. The general meeting will select the leader of the committee, and its members, and determine its remuneration based on the character of duty and time consumed. The duties and responsibilities of the nomination committee are set forth in the instructions of the nomination committee. The committee s responsibilities are to propose candidates to be elected to the Board of Directors and to recommend remuneration for members. Reasonable support should be provided for each committee member s recommendation and include relevant information about the candidates and their independence. The notice of the Nomination committee shall be made available within the 21 day deadline for announcing the general meeting notice. Requirements for the nomination committee are set forth in Infratek ASA s articles of association (Section 7). Efforts must be made to ensure that the composition of the nomination committee is broadly representative of shareholder interests and necessary expertise, and that the majority of members are independent of the Board of Directors and the company s executive management. Further, a maximum of one member should be a Board member and shall then not repeatedly be put forward for election. Executive management, or other managing employees, should not serve on the nomination committee. Infratek ASA does not have a corporate assembly or a committee of shareholders representatives. An overview of nomination committee members, deadlines for submitting proposals to the committee, and the committee s instructions, are available on Infratek s website at www.infratek.no. 8 Corporate assembly and board of directors, composition and independence 8.1 Corporate assembly Pursuant to an agreement entered into between Infratek ASA and employee unions (see Section 6-35, first and second sentences, of Norway s Limited Liability Companies Act), the Group does not have a corporate assembly. This is a deviation from the recommendations found in the Norwegian Code of Practice for Corporate Governance. 8.2 Board of Directors Infratek s Board of Directors is to comprise between five and nine members. Three to six of these members must to be elected by the company s general meetings. Members elected by the general meetings serve for two-year periods. Insofar as possible, the service term for half of these members should expire each year. At least two board members must be elected by and among employees; alternatively, the minimum number of board members to be elected by and among employee is the number 7

demanded by employees (plus observers and deputy members) pursuant to the Public Limited Liability Companies Act and its regulations, applicable when the company does not have a corporate assembly. Employee-elected Board members serve for periods of two years. The CVs of Board members are available on Infratek s website www.infratek.no and in the company s annual report. See also the discussion of the Board s responsibilities in item 10 below. 8.2.1 Composition of the Board The Board comprises at the time of five shareholder-elected members and three employee representatives. See Section 6-4 of Norway s Public Limited Liability Companies Act. The Nomination committee proposes the shareholder-elected members of the Board towards the general meeting. The company is concerned that Board candidates possess the necessary industry acumen, in addition to having the business, managerial, and financial expertise necessary to fulfil the role of visionary, strategist, and result-seeking dialogue partner for the company s management. Further, the Board s composition should be such that it can maintain the interests of shareholders and function as a collegial body. Among the members of the Board, competence and independence shall be present which is required to establish an audit committee. The company seeks a gender-balanced representation among both shareholder-elected and employee-elected Board members. There are two female shareholder elected Board members of Infratek ASA. This fulfils the Public Limited Liability Companies Act sex quota requirement with regards to shareholder elected Board composition of public limited companies. There are no female employee elected representatives at the Board as Infratek has a female share among total employees below 20 percent. The sex quota law is hence not applicable, cf. Section 6-11a of Norway s Public Limited Liability Companies Act. 8.3 Independence Shareholder-elected Board members and parties closely related 2 to them may not perform advisory or consulting services for the company; nor may they be Infratek employees or be parties to significant financial agreements with the Group. The Group may, as a main rule, neither purchase advisory or consulting services from a company that a Board member either owns or is employed by. Any exemptions from these principles must be discussed by the Board on a case-by-case basis. Board members may not be closely related to other Board members, nor to leading company personnel. As discussed under section 4.2, Transactions with related parties, Hafslund ASA represents the largest shareholder and the Fortum Nordic AB the second largest shareholder of Infratek ASA. Two representatives of the Board have a close relationship to Hafslund ASA and Fortum Nordic AB respectively. Hafslund and Fortum, including subsidiaries, further represent significant customers of Infratek and suppliers of certain services. Ordinary business activities towards Hafslund and Fortum, including subsidiaries, which are considered to be on arms length basis will not be presented to the Board as discussed above 2 Closely related is used here as the term is defined in Chapter 1, Section 1-4 of Norway s Securities Trading Act. 8

or presented to the market through a stock exchange notice. This may deviate from the Norwegian Code of Practice for Corporate Governance. Pursuant to the Board instructions, a Board member may not participate in discussions or voting on issues as to which the member or any closely related party has a stake in the outcome, or as to which the member must be regarded as having a prominent personal or financial interest. The same principle applies to the CEO. A board member shall neither participate in the handling of situations where the person has a central position in a company which in the situation has a potential conflict of interest with Infratek ASA. Further, in order to foster market confidence, at least two of the company s shareholder elected Board members must be independent of the company s main shareholders. The majority of the shareholder-elected Board members should be independent of the company s executive management and/or significant business associates. Representatives of executive management are not to be Board members. The chairman of the Board should be elected by the general meeting unless the Norwegian Public Limited Liability Companies Act requires the chairman of the Board to be elected by the corporate assembly or by the Board, as a consequence of an entered agreement stating that the company shall not have a corporate assembly. It shall be noted which Board members who are considered independent. Infratek ASA s Board members are encouraged to hold company stock. 9 The work of the board of directors 9.1 The tasks and responsibilities of the Board The purpose of Infratek s Board instructions is to establish guidelines for the Board s work and the processing of issues, including the salient rules applicable to the responsibilities of the CEO and the latter s obligations vis-à-vis the Board, as well as the Board s authority under current legislation and regulations. Once a year, pursuant to the Board instructions, the CEO shall propose an annual agenda in consultation with the Board Chairman, with particular emphasis on goals, strategies, and execution. Normally six Board meetings are to be held each year, although no fewer than four meetings may be held. Board meetings should normally be convened on seven days notice. The CEO, along with the Board Chairman, are responsible for preparation and documentation of issues that will come before the Board. The Board is responsible for the management of the company and for the appropriate organization of the company s activities; this includes monitoring the company s executive management. The Board is charged with decision making (which authority may be delegated) for issues that are unusual or of major importance to the company. The Board is to ensure that the company maintains good internal accounting controls and inhouse rules so that Infratek remains in compliance with laws and regulations that applies to the business, including the company s values and ethical guidelines. The Board is to make sure that all necessary guidelines for the business and the company s management are prepared, and shall, to the extent necessary, adopt plans and budgets for 9

the company and the activities of its subsidiaries. The Board shall evaluate the performance of the company s CEO annually. 9.2 Board Chairman The Board Chairman has a particular responsibility to ensure the satisfactory functioning of the Board and to see that the Board s tasks and responsibilities are handled in the best possible way. The Board Chairman is to ensure that the expertise of each Board member is utilized in the best possible manner in the Board s work. The Board is to elect a Deputy Chairman, who is to serve as an alternate Board Chairman and an effective dialogue partner for the Board Chairman, and to manage discussions where the Board Chairman itself is or has been actively engaged to secure a more independent treatment. The Board Chairman should strive to have all Board negotiations take place with the full Board present and that all significant decisions are made by the full Board. 9.3 Board committees / sub-committees The Board shall use sub-committees and/or board committees to the extent found useful or when it is required by law. Infratek has established an audit committee which satisfy the requirements of Section 6-42 of Norway s Public Limited Liability Companies Act. Information about Board committees and their responsibilities is to be provided in the company s annual report. 9.4 Reporting to company management As part of ordinary auditing, the company s auditors will provide management, represented by the CEO and the CFO, with a written report once or twice a year. The main items in these reports are to be discussed by the auditor and management in Board meetings. 9.5 Evaluation of the Board s work The Board evaluates its own performance once a year. These evaluations are conducted through written surveys and discussions of possible improvement measures for the Board s work. Such evaluations focus on the Board s internal working methods and procedures, its relations with Group management, and how the Board is viewed by non-board members. The Nomination committee is to be kept current as to this work, and will be notified of the findings of the evaluation. 10 Risk management and internal control The Board will ensure that the company has good internal control and adequate systems for risk management of the Group s enterprise. Risk management and internal control will reflect the art and scope of the enterprise, as well as the scope of values and ethical guidelines (see item 1.1 and 1.2). The Board annually revises the company s most important risk areas and its internal control. The Board will furthermore give a description of the key elements of the company s internal 10

control and risk management systems, related to the financial reporting of the Group s annual report. 11 Remuneration of the Board of Directors Remuneration for Board members must be reasonable in light of the tasks and responsibilities they are charged with. The remuneration paid to the Board of Directors does not depend on Infratek s financial performance. The Board members have not been awarded options. As a general rule, Board members or companies they are associated with may not render services to Infratek beyond their Board responsibilities. Should they render services beyond their Board responsibilities, the Board is to be so informed, and fees for such services must be subject to Board approval. Notification will be provided in Infratek s annual reports of all remuneration paid to individual Board members, including any fees paid for special tasks and the number of shares held by various Board members. 12 Remuneration of executive management 12.1 The responsibilities of the Group Management Group management assists the CEO by following up on his/her responsibilities. In Group management meetings, which are held once on a regular basis, Group operations are coordinated. Infratek s CEO is responsible for day-to-day management of the company s activities, and is to follow the guidelines and directives provided by the Board of Directors. 12.2 Composition of Group management Infratek s Group management comprises the CEO and the Group Executive Vice Presidents for the various business areas, according to the current organizational structure. Infratek notifies the Oslo Børs of any changes in the composition of its group management. The CVs of Group management members are available on Infratek s website at www.infratek.no and are included in the company s annual reports. 12.3 Guidelines for the remuneration of the members of the Executive management Remuneration of the CEO is determined by the Board of Directors. Total remuneration for Group Executive Vice Presidents is determined in discussions between the Board Chairman and the CEO. Remuneration to the executive management is based on the company s guidelines. The Board is notified of the outcome of these discussions. The Board should adopt guidelines for determining remuneration of the CEO and executive management, and these guidelines should be presented at Infratek s general meeting according to the law. The guidelines for the remuneration of the members of the executive 11

management shall provide the main principles for the company s executive management remuneration policy. The principles should seek to attain coinciding interests between the shareholders and the executive management. This means that performance-related remuneration of the executive management in the form of share options, bonus programmes or the like should be linked to value creation for shareholders or the company s earnings performance over time. Such arrangements should be based on quantifiable factors over which the employee in question can have influence. Remuneration guidelines and all elements of remuneration payable to the CEO and leading executives should be presented in the annual report. Further, Infratek s annual report must disclose the total salary, fees, and any other remuneration payable to the CEO, along with information on the number of shares held by the CEO and other leading executives. 12.4 Evaluation of Group management Group management conducts a yearly evaluation of the performance of top management. An individual evaluation of the CEO should also be performed as part of this yearly evaluation. 13 Information and communications The Board s information policy features open communications and equal treatment of all shareholders as overarching goals. The Board is to make sure that quarterly financial reporting provides a basis for a complete picture of the Group s financial and business positions, and accurately portrays the achievement of the company s operational and strategic goals. Such reporting must also present the Board s realistic expectations as to business development and profit. All financial information, presentations to analysts, quarterly reports, annual reports, stock exchange notices, and press releases are made available as rapidly as possible on the Group s website at www.infratek.no so as to ensure equal access to such information. Further, a financial calendar is available on the Group s website, with dates for quarterly reports, publication of preliminary profit performance, and dates of general meetings. Such information is also distributed via stock exchange notices to ensure equal treatment of shareholders. The company s management regularly schedules meetings with investors and analysts. All official information stock exchange notices, press releases, reports, etc. are available in both Norwegian and English, as a proportion of the company s shareholders is expected to be domiciled outside of Norway. The Board should adopt guidelines for the company s reporting of financial data and other information based on transparency, open communications, and equal treatment of securities market participants. Further, the Board should establish guidelines for the company s communications with shareholders outside Infratek s general meetings. 12

14 Company takeovers As a general rule, the Board will not seek to prevent or obstruct takeover bids for the company s business activities or shares. In the event of a potential takeover or in restructuring situations, the Board recognizes its responsibility to exercise particular caution so that all shareholders values and interests are maintained. Transactions that are in fact a divestiture of the company s activities are to be presented at the company s general meeting. In the event of a takeover bid for the company s shares, the Board of Directors will not execute authorizations or make other decisions that obstruct the bid, unless the general meeting approves such obstructive actions after the bid and its details become known. The Board will seek to give shareholders sufficient information and time to be able to evaluate the bid, among others through a statement of evaluation and recommendation of the bid, or a valuation carried out by an independent expert. If a larger shareholder, board member, senior executives, related parties to any of these or any who ve currently had such a position, are a bidder or have any special interest in the offer, the Board will ensure that an independent valuation is compiled. If a recommendation cannot be provided, it will be accounted for by the Board. 15 Auditor The company s auditor is approved by the general meeting; among the responsibilities of the auditor are the examination of the Board and the management of the company. Thus, the auditor must be independent of the company s management bodies. At annual general meetings, the Board presents remuneration payable to the auditor for both legally required auditing services and other specific services, if any. 15.1 Auditor s independence The auditor will provide a yearly written confirmation that the auditor meets established requirements for independence and impartiality. The Board is to verify the independence of the auditor, making particular note of any conflict of interest and, if applicable, the auditor s performance of significant services beyond the legally required audit, as set forth in Norway s auditing and auditors act. Closely related advisory services by the auditor outside legal audit shall be explained and the Board informed. 15.2 Auditor s work schedule The auditor participates in Board meetings in which the annual accounts are discussed. In addition, the auditor will meet with the Board at least once a year to present his or her opinions as to the company s accounting principles, evaluation of significant accounting estimates, areas of risk, internal control procedures, any issues of disagreement between the auditor and executive management, and to present the main features of a plan to execute the audit. The Board and the auditor shall meet at least once a year outside of the presence of the CEO or other members of Infratek s executive management. The auditor shall minimum once per year present to the audit committee the Company s internal control, hereunder, identify weaknesses and proposals for improvement. 13

15.3 Auditor s mandate period There is no mandated period for Infratek s auditor. Infratek ASA s Corporate Governance policy was approved by the Board of Directors on 23 February 2010. 14