AMSC ASA — Board/Management Information 2022

Apr 1, 2022

Recommendation on selection of auditor

American Shipping Company ASA (AMSC) conducted a competitive tender for audit services in 2021. Pursuant to Article 16, paragraph 2 of EU Regulation no. 537/2014, the Auditors Act and amendments in the Norwegian Public Limited Liability Companies Act, the Audit Committee shall make a recommendation to the Board of Directors which again shall recommend to the Annual General Meeting of AMSC regarding the selection of an auditor. The recommendation shall identify at least two alternatives from which to select an auditor and shall make a justified recommendation for one of the auditors.

In order to comply with the independence requirements including the prohibited services listed in Article 5 in the EU Regulation referred to above, the election of the new auditor will be effective for the audit from the fiscal year starting with 1 January 2022. AMSC's current auditor, KPMG, will act as AMSC's auditor for the entire 2021 fiscal year audit and continue to act as the company's auditor until appointment of the new auditor by the General Meeting on April 22, 2022.

The reputable audit firms Deloitte, KPMG and PwC submitted offers during the tender. Other relevant providers of audit services were considered but did not take part in the competitive tender. Once tender documents were received on 7 June 2021, a thorough review process was conducted, including presentations of tender materiel and individual meetings with all tender participants. The candidates were evaluated against predefined selection criteria:

• Understanding of American Shipping Company (industry, business risk, Jones Act etc)
• Audit approach, including but not limited to access to relevant U.S. tax services
• Audit fee and fee level for non-audit services
• Reporting, feedback and knowledge sharing
• Team composition, competence, experience and service level
• Transition process

The candidates in the tender were all highly competent and professional, and they are ranked among the best audit firms globally. They all scored high on the predefined selection criteria and were all assessed capable to provide effective and high-quality audit services to AMSC. The final phase of the tender process included follow-up meetings, clarifications, reference checks and final fee negotiations.

Overall, the tender from PwC provided the best impression by demonstrating a committed company with a strong shipping team possessing industry knowledge, local presence in Oslo and Philadelphia, an efficient audit approach and with access to U.S. Tax competence and a competitive audit fee.

Based on the conclusion from the tender process, the Audit Committee therefore recommends that AMSC's board of directors propose that PwC is elected as auditor, effective from the fiscal year starting with 1 January 2022.

The Audit Committee would like to thank KPMG for several years of delivering high-quality audit services and excellent expertise to AMSC.

In accordance with Article 16, paragraph 2 of the EU regulation no. 537/2014, the Audit Committee confirms that the recommendation is free from influence by a third party and that no clause or contract are entered into between AMSC and a third party limiting the alternatives available to the annual general meeting of AMSC, as referred to in Article 37 of Directive 2006/43/EC.