AF Gruppen — AGM Information 2015

Apr 22, 2015

Notice of Annual General Meeting 2015

The Annual General Meeting of AF Gruppen ASA will be held on Thursday 13 May 2015 at 10.30 in the company's offices at Innspurten 15, Oslo.

Agenda

Item	Enclosure no.:

3

• 1. Opening of meeting by Board Chairman Tore Thorstensen, and registration of shareholders attending. In accordance with Article 6 of the Articles of Association, the chairman of the board also chairs the meeting.
• 1. Election of at least one person to countersign the minutes.
• 1. Approval of the notice and the proposed agenda.
• 1. Briefing on operations.
• 1. Briefing on the work of the Board, work of the Audit Committee and work of the Compensation Committee. 1 and 2
• 1. Review of the Board of Directors' statement on the determination of fixed pay and other remuneration for senior employees, cf. section 6- 16a of the Public Limited Liability Companies Act.
• 1. Adoption of the annual accounts and annual report for 2014, including the consolidated accounts and distribution of dividends, and discussion of the statement on corporate governance.
• 1. Approval of auditor's fees.
• 1. Determination of Directors' fees for the 2014 financial year. 4 10. Election of the Board and the Nominating Committee. 4
• 1. Determination of the Nominating Committee's fees for the 2014 financial year.
• 1. Election of an auditor
• 1. Authority to the Board to purchase treasury shares.
• 1. Authority to carry out private placing to employees.
• 1. Authorisation to the Board to increase the share capital by issuing new shares
• 1. Other business

* * * * *

AF Gruppen ASA has a share capital of NOK 4,571,380.35 made up of 91,427,607 shares, each with a face value of NOK 0.05. Each share gives the right to one vote at the Company's General Meetings. As at the date of this notice, AF Gruppen owns no treasury shares.

The shareholders have the following rights in connection with general meetings:

• Right to attend general meetings, either in person or by proxy.
• Right to express themselves at general meetings and right to bring one adviser and give them the right to express themselves.
• Right to demand details from board members and the CEO on matters that can have a bearing on the assessment of (i) the approval of the annual accounts and annual report, (ii) issues that are submitted to the shareholders for a decision and (iii) the company's financial position, including on the activity in other companies in which the company participates, and other issues to be dealt with by the General Meeting, unless the details that are demanded would cause disproportionate damage to the company.
• Right to propose alternatives to the Board's proposals for the issues to be dealt with by the General Meeting.

The shares are listed ex dividend on 15 May 2015. The dividend will be paid on 26 May 2015.

If you wish to appoint a proxy to represent you at the Annual General Meeting, please use the attached proxy form. Appointing a proxy must be done in writing.

Registration for the Annual General Meeting must be in the company's hands no later than Monday 11 May 2015. Shareholders who have not registered by this deadline may be refused entry to the Annual General Meeting. Please use the registration slip you have been sent or notify us by telephone by calling 22 89 11 00 if you wish to attend the General Meeting.

This notice of meeting with enclosures and the 2014 Annual Report are available on the company's website: www.afgruppen.no.

In accordance with Article 6 of the Articles of Association, the appendices to the notice of meeting are not sent by post to the shareholders. Shareholders who wish to receive a copy of the 2014 Annual Report may contact the company c/o Lars Chr. Paulsen, tel. +47 900 25 969 or LCP@afgruppen.no

Oslo, 22 April 2015 AF Gruppen ASA

Tore Thorstensen Board Chairman

Appendices: Registration slip Proxy form Report from the Audit Committee Report from the Compensation Committee Board of Directors' statement on the determination of fixed pay and other remuneration to senior executives Report from the Nominating Committee

Details of Items 7, 8, 9,11, 12, 13 and 14 on the agenda:

Item 7. Adoption of annual accounts and annual report for 2014, including the consolidated accounts and the distribution of dividends The Board proposes that the Annual General Meeting adopt the annual accounts and annual report.

It is proposed that a divided of NOK 5.00 per share be paid. Of the NOK 5.00 dividend, NOK 3.80 will be distributed as repaid capital.

A dividend will not be paid for treasury shares.

Item 8. Approval of auditor's fees.

The Board proposes payment of the auditor's fees as invoiced.

Item 9. Determination of the Directors' fees for the 2014 financial year

The Nominating Committee proposes the following fees:

Chairman of the Board		NOK 420,000
Shareholder-elected board members		NOK 210,000
Employee-elected board member		NOK 190,000
Committee Chairman
Compensation Committee	NOK	55,000
Audit Committee	NOK	70,000
Committee members
Compensation Committee	NOK	40,000
Audit Committee	NOK	55,000

Item 11. Determination of the Nominating Committee's fees for the 2014 financial year

The Board proposes the following annual fee for the Nomination Committee: Chairman NOK 40,000 Members NOK 35,000

Item 12. Election of auditor

The board, primarily through the board's audit committee, has considered the question of the election of a new auditor. Following a bidding process in which five bids were received, the audit committee has proposed that EY AS (Ernst & Young) c/o certified public accountant Tommy Romskaug is elected as new auditor for AF Gruppen ASA including subsidiaries. This is consistent with the recommendations of the administration. In line with this, the board proposes that EY AS c/o Tommy Romskaug is elected as new auditor of AF Gruppen ASA and its subsidiaries.

Item 13. Authority to the Board to purchase treasury shares

At the Annual General Meeting held on 15 May 2014, the Board was authorised to purchase treasury shares up until the Annual General Meeting in 2015, although not after 30 June 2015. The Board proposes that this authority be renewed until the Annual General Meeting in 2016, although not after 30 June 2016.

The Board Proposes that the Annual General Meeting authorise the Board to purchase treasury shares within the limitations allowed by the Public Limited Liability Companies Act. The purpose of this authority is to give the Company an opportunity to purchase

shares in situations where this would be in the Company's interest. It is proposed that the Annual General Meeting adopt the following resolution:

"The Board is authorised to acquire the Company's own shares, including the establishment of charges created by agreement.

The highest nominal value of the shares the company may acquire is NOK 457,138, although at all times within the limitations set in section 9-2 of the Public Limited Liability Companies Act. The smallest amount that may be paid for a share is NOK 0.05. The highest amount that may be paid for a share is NOK 150.

When buying and selling treasury shares the company should seek to achieve the most favourable price possible. The Board is free with respect of the methods used to acquire and dispose of treasury shares, though always with the provision that the general principle of equal treatment of shareholders must be observed. For the sale of shares to employees and officers, shares may be sold at a discount of up to 20% under the prevailing market price. Acquisition and disposal of treasury shares may thus occur, for example, with settlement in cash, with settlement by means other than cash or as settlement in connection with a merger or demerger.

The company's share capital is NOK 4,571,380.35 made up of 91,427,607, shares, each with a face value of NOK 0.05. If the share capital or face value of the shares is changed, the amounts specified in the second to fourth sentences shall be changed correspondingly.

This authority to the Board replaces the former authority dated 15 May 2014 and will apply until the date of the Annual General Meeting in 2016, although not after 30 June 2016."

Item 14. Authority to carry out private placing to employees

In the last few years, all of AF Gruppen's employees have been given an opportunity to buy shares at a 20% discount in relation to the average share price during the subscription period. It is desirable that similar opportunities are provided in 2015.

As of today's date, the Company owns no treasury shares. In order to obtain a sufficient number of shares to enable this sale of shares to employees, it may be necessary to issue new shares. Therefore, the Board asks the Annual General Meeting to authorise it to issue a limited number of shares for employees so that employees may buy shares in the Company in 2015.

The Board proposes that the Annual General Meeting adopt the following resolution, cf. the Public Limited Companies Act, Sections 10-14 to 10-19:

The Board is authorised to increase the share capital by issuing new shares.

The share capital may be increased by a total of up to NOK 50,000 through the issuing of up to 1,000,000 shares, each with a face value of NOK 0.05. The authority can be exercised through one or more issues.

The statement of the share capital and number of shares in Article 4 of the Articles of Association shall be changed correspondingly.

The power of attorney may only be used to issue shares in connection with the sale of shares to employees in the Group.

The Board may decide to deviate from the shareholders' pre-emptive right to subscribe

for shares under section 10-4 of the Public Limited Companies Act.

The authorisation is valid until the date of the Annual General Meeting in 2016, but not later than 30 June 2016.

Item 15. Authorisation for the Board to increase the share capital by issuing new shares

The Board proposes that the Annual General Meeting authorises the Board to increase the share capital by up to 3% of the current paid-in share capital by issuing new shares. This authorisation is valid until the 2016 Annual General Meeting, but not later than 30 June 2016.

The justification for the proposal is that the authorisation will provide greater flexibility in connection with acquisition of business.

The Board proposes that the following is adopted, cf. sections 10-14 to 10-19 of the Public Limited Companies Act:

"The Board is authorised to increase the share capital by issuing new shares. The share capital can be increased by a total of up to 3% of the current paid-in share capital with a face value of NOK 0.05 per share.

The authority can be exercised through one or more issues. The statement of the share capital and number of shares in Article 4 of the Articles of Association shall be changed correspondingly.

The Board may decide to deviate from the shareholders' pre-emptive right to subscribe for shares under section 10-2 of the Public Limited Companies Act.

The Board may decide that share contributions may be assets other than cash, or the right to involve the company in special obligations pursuant to section 10-2 of the Public Limited Companies Act. If share contributions are to be settled by assets other than cash, the Board may decide that such assets be transferred to subsidiaries in return for corresponding settlement between the subsidiary and AF Gruppen ASA.

The authorisation also applies in the event of a decision to merge, pursuant to section 135 of the Public Limited Companies Act. The authorisation may also be used in those cases discussed in section 5-15 of the Stock Exchange Act.

This authority is valid from and including 15 May 2015 until and including the date of the Annual General Meeting in 2016, although not after 30 June 2016."

Registration

for

Annual General Meeting of AF Gruppen ASA on 13 May 2015

The undersigned, the holder of ................................... shares in AF Gruppen ASA, will attend the company's annual general meeting on 13 May 2015 at 10.30.

place......................................., date ...... /........ 2015

.......................................................

Signature

.....................................................

Name in capital letters

Authorization to the Annual General Meeting of AF Gruppen ASA

The undersigned, the holder of …………………………. shares in AF Gruppen ASA, hereby authorizes

............................................................ to attend and vote for my shares in (capital letters)

AF Gruppen ASA at the Annual General Meeting on 13 May 2015.

Check the relevant item if voting against the proposed resolution:

Item 3	Approval of the notice and the proposed agenda	Vote against
Item 7	Adoption of annual accounts and annual report	Vote against
	Item 9 Determination of the Director's fees	Vote against
	Item 10 Election of the Board and the Nomination Committee	Vote against
	Item 11 Determination of the Nomination Committee's fees	Vote against
	Item 12 Election of auditor	Vote against
	Item 13 Authority to purchase treasury shares	Vote against
	Item 14 Authority to carry out private placing to employees	Vote against
	Item 15 Authority to increase share capital by issuing new shares	Vote against

Comments:

................................................................................................................................................................... ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………… place......................................., date ...... /........2015

....................................................... Signature

.....................................................

Name in block letters

Appendix 1

Report from the Audit Committee 2014/2015

The Company's Audit Committee is made up of three shareholder-elected board members:

Hege Bømark (chairman) Mari Broman Daniel Kjørberg Siraj

The Group's CFO Sverre Hærem participates at all Committee meetings. The Company's auditor, Asbjørn Ler, participated at 6 meetings.

The purpose of the Audit Committee is to assist the Group Board with management and performance of the Board's supervisory responsibility pursuant to Sections 6-12 and 6-13 of the Public Limited Liability Companies Act. The Audit Committee's mandate is adopted by the Group Board and described in the "Mandate for the Group Board's Audit Committee".

The following tasks are included in the Audit Committee's mandate:

• Assess the Group's financial and account reporting
• Evaluate the auditing, nominate an auditor for election and explain the auditor's fees broken down by auditing and other services to the Annual General Meeting.
• Assess the Company's internal controls, including:
• o Group's management of risk
• o Group's internal control functions and authority matrix
• o Group's cash management
• o Group's ability to perform assessments, improve, execute and follow up investment decisions
• o Organisational matters related to financial reporting and control in the Group

The Audit Committee has held six meetings since the last Annual General Meeting. The Audit Committee has reviewed the following matters:

• Account reporting:
• o Review of quarterly reports
• o Plan the annual report
• o Preliminary results for 2014
• o Annual accounts 2014
• o Impairment test of intangible assets
• o Evaluation and weighting of annual report
• Audit
• o Interim audit, including:
  • Project understanding, accounting management, risk management
• o Review of audit for 2014
• o Assessment of auditor's fees
• o Assessment of auditor's independence
• o Head bidding process and nominate an auditor for election
• Internal control
• o Review of rules and regulations the audit committee must relate to
• o Group initiative Barriers for critical operations
• Financing
• o Detailed review of financing of AF Gruppen
• Acquisition of companies
• o M&A in AF Gruppen

The Audit Committee has provided its recommendation for the issues it has dealt with for final resolution by the Board. Oslo, 25/03/2015 Hege Bømark

Appendix 2

Report from the Compensation Committee 2014/2015

The Company's Compensation Committee (CC) is made up of two shareholder-elected board members:

• Peter Groth (Chairman)
• Tore Thorstensen

The Company's CEO, Pål Egil Rønn, participates in the meetings.

The purpose of the Compensation Committee is to be a preparatory body for the Board in matters that concern the evaluation of the fixed pay and other remuneration determined for the CEO, in addition to being an advisor to the CEO in connection with determining the terms for members of the Corporate Management Team.

The Compensation Committee's mandate is adopted by the Group Board and described in the "Mandate for the Compensation Committee".

The Committee's work consists of questions related to fixed pay, bonuses, options, severance pay, early retirement and retirement pensions,

The following tasks are included in the Compensation Committee's mandate:

• Evaluate whether the remuneration of the CEO and the rest of the Corporate Management Team is appropriate and adapted to the operations.
• Prepare and recommend proposals for the compensation of the CEO, including adjustment of the fixed pay, bonuses and other incentive schemes and present these to the Board for evaluation and a decision.
• Prepare and present the employees' participation in any new issues, share programmes, etc. to the Board.
• Present guidelines for the remuneration of senior executives to the Board, which will be presented to the Annual General Meeting for their information/approval after review by the Board.
• Prepare and present other significant personal matters that are related to the compensation of senior executives to the Board.

The Compensation Committee has held one meeting after the Annual General Meeting on 15 May 2014, where a new option programme was adopted for the years 2014-2017.

The Board was authorised by the Annual General Meeting to draw up the specific guidelines within the provided framework in connection with the new option programme.

The Compensation Committee has thus assessed and presented to the Board;

• results and experiences related to the previous option programmes for the years 2008-2011 and 2011-2014
• reviewed experiences and results related to the company's schemes with regard to share purchase and bonus programmes
• proposals for specific guidelines for the practical implementation of the option programme, including

Appendix 2

• o distribution of options to the various employee groups
• o time for introduction and distribution of options throughout the period
• o time for allocation of options
• o non-transferability of options and lock-in period for option holders
• o curtailment in the event of over-subscription and correction of exercise price in the event of extraordinary dividends
• calculation of the accounting consequences of the option programme, the number of new shares and dilution consequences
• necessary authorisations the Annual General Meeting must give the Board with regard to acquisition of the required number of shares, such that the company's obligations toward the employees with regard to the option programme, bonus programme and share purchase programme may be fulfilled.

Oslo, 07/04/2015 Peter Groth

Board of Directors' statement on the determination of fixed pay and other remuneration to senior executives

The Board of Directors has prepared the following statement on the determination of fixed pay and other remuneration to senior executives pursuant to Section 6-16a of the Public Limited Liability Companies Act.

Senior executives are defined as the Corporate Management Team, which consists of the CEO and executive vice presidents.

1. Determination of fixed pay and other remuneration for senior employees

Main principles

o The salaries of senior executives are made up of a fixed component, the base salary, and a variable component in the form of a bonus.

The sum total of the base salary and bonus constitutes the total remuneration the employees receive for their services.

• o The scope of the variable component of the remuneration depends on to what degree the defined economic targets are achieved.
• o The total remuneration that is offered shall be competitive in relation to comparable positions and the market.
• o The Compensation Committee is the Board of Directors' advisor for the evaluation of the terms for senior executives.

Determination of the CEO's remuneration

The Board of Directors determines the CEO's remuneration in consultation with the Compensation Committee. The CEO has otherwise the same employment terms and notice period as other employees. There are no agreements relating to severance pay or early retirement.

Determination of the remuneration of executive vice presidents

The Board of Directors establishes guidelines for the remuneration of senior executives in consultation with the CEO.

There are no agreements relating to severance pay or early retirement.

Bonus

Bonuses for senior executives are based on the EVA (Economic Value Added) model. EVA is a method of calculating and analysing value creation in the Group and in economic units below group level. Bonuses based on the EVA model for senior executives are linked to the Group's value creation and the individual business area through the financial year. If the performance requirements are met, the bonus payment should ordinarily represent up to 8 months' pay. This is, however, not the absolute maximum limit.

Of the total bonus earned, 25% can be used to buy shares at a 20% discount and the remainder is paid in cash. The lock-in period for the shares is one year.

Purchase of treasury shares

Shares can be sold to senior executives, subject to the approval of the Board of Directors at a 20 % discount on the prevailing market price. Shares are offered to senior executives in the same way as to other employees.

Options

On 13.05.2011, the Annual General Meeting adopted an option scheme that includes all the employees in

AF Gruppen. The option scheme is to provide an incentive for all the employees in the Group. The purpose of the programme was to encourage long-term commitment and greater involvement in the Group's activities. It is believed that the Group's future objectives will best be achieved when the interests of the Group and its employees coincide.

1,240 employees redeemed a total of 5,755,679 options in March 2014.

At the AGM on 15 May 2014 it was decided to establish a new option scheme for all employees of AF Gruppen. The maximum number of options that can be granted is 4,500,000. Each option entitles the holder to acquire a share in AF Gruppen ASA. The option scheme entails an annual allotment of options for 2014, 2015 and 2016, with the allotting starting in 2014. The Board has been authorised to distribute the options between the different employee groups.

The employee must pay NOK 1.- per option to acquire options. The exercise price is determined as the share's market value at the time of issue.

Exercise of options shall occur in the course of the first quarter of 2017 as decided by the Board. It is a condition of exercising options that the holder is still employed by the group on 01 March 2017.

Retirement benefit scheme and payments in kind

Senior executives participate in the Group's retirement benefit scheme and receive payments in kind in the form of allowances for work travel, data connections and mobile telephones on par with that of other employees.

2. Compensation policy in force in 2014

Determination of the CEO's remuneration

The terms for the CEO were set by the Board of Directors. The remuneration paid in 2014 was in accordance with the agreements entered into, and a bonus was paid for the 2013 financial year in addition to the salaries for 2014.

Determination of the remuneration of executive vice presidents

The terms for the executive vice presidents were set by the CEO in consultation with the Board of Directors. The remuneration paid in 2014 was in accordance with the agreements entered into. A bonus was paid for the 2013 financial year.

Executive vice presidents' bonuses are paid on the basis of the EVA achieved in the Group.

3. Effect of changes to the compensation schemes agreed on in 2014

There have been no changes in the compensation schemes in 2014, which differ from 2013.

4. Guidelines for the determination of fixed pay and other remuneration for 2015 The determination of fixed pay will follow the same principles in 2015 as in 2014.

For further information, please refer to notes 7 and 29 in the annual report.

Recommendations of the Nominating Committee to the Annual General Meeting of AF Gruppen ASA, 13/05/2015

1. The Nominating Committee's work

The Nominating Committee has met with all the board members and the CEO in order to evaluate the Board's work on behalf all the Company's shareholders. In addition, there has been a written evaluation of the Board, which has formed the basis for discussions with the Board members.

The evaluation of the Board's work has concluded that a change should be made to the composition of the Board at the Annual General Meeting. Several meetings have been held in the Nominating Committee to identify new candidates suitable for board positions in the company. Based on the discussions, the Nominating Committee has arrived at two new candidates who are put forward for election at the upcoming Annual General Meeting.

At the Annual General Meeting in 2009 the Articles of Association were amended so that up to two alternate members with the right to attend board meetings could be elected. The Nominating Committee recommends that this arrangement be maintained, and that a permanently attending alternate is elected at this year's Annual General Meeting.

2. Election of Board members and the Board Chairman

Shareholder-elected Board members are up for election every year. The Nominating Committee submits the following proposal to the General Meeting:

The following individuals should be elected as Board members for one year:

Bømark, Hege (re-election) Groth, Peter (re-election) Lunde, Borghild (new) Siraj, Daniel (re-election) Thorstensen, Tore (re-election)

Alternate representatives:

Kristian Holth (new)

The Nominating Committee proposes that the Annual General Meeting elect Tore Thorstensen as the Board Chairman.

3. Remuneration for the Board and Nominating Committee for the election period until the Annual General Meeting for the 2014 financial year

The Nominating Committee submits the following remuneration proposal for approval:

Chairman	:	NOK 420,000
Board members;
- shareholder-elected	:	NOK 210,000
- employee-elected	:	NOK 190,000
Alternate(s)	:	(per meeting) NOK 20,000

Committee members

-	Compensation Committee	:	NOK 40,000
-	Audit Committee	:	NOK 55,000

Committee Chairman

-	Compensation Committee	:	NOK 55,000
-	Audit Committee	:	NOK 70,000

The Board proposes the following for adoption concerning the remuneration of the Nominating Committee:

Members	:	NOK 35,000
Chairman, Nomination Committee	:	NOK 40,000

4. Nomination Committee

The Board submits the following proposal to the Annual General Meeting:

The following shall be elected to the Nominating Committee for one year:

Arne Baumann Tor Øivind Fjeld Gunnar Bøyum

It is proposed that Arne Baumann be re-elected chair.

Oslo, 10/04/2015

Arne Baumann Tor Øivind Fjeld Jan Fredrik Thronsen Conductor

Brief personal details of the Committee's proposed candidates for the new election:

Board:

Borghild Lunde (50) is a member of the executive management of ABB's Norwegian operations, and is Director of Oil, Gas and Chemicals - Process Automation. She is also a member of the global management group for Oil, Gas and Chemicals, with responsibility for Denmark and Russia. Throughout her career, she has held senior positions within ABB's oil and gas operations, including strategy, sales, projects and R&D. She has held global responsibility in R&D, with technology that ranges from automation, safety, electrical and telecommunications to information systems. She has experience from major delivery, framework and development contracts with international oil companies in offshore and subsea field development and operations.

Education: Chartered engineer from the Norwegian University of Science and Technology.

Kristian Holth (31) is CFO with KB Gruppen Kongsvinger AS. Before joining KB Gruppen in 2013, he was CFO and controller with Contiga AS. He also has experience from McKinsey & Company. He is a board member of KB Gruppen Kongsvinger AS, Gunnar Holth Grusforretning AS, BL Entrepenør AS, BRG Entrepenør AS and several single-purpose property companies.

Education: Chartered engineer in Industrial Economics from the Norwegian University of Science and Technology.