Corporate Governance

Reports

Share Information

Company Presentations

1. Corporate Governance report

The following report shows how Wilson complies with the principles and guidelines laid down in the Norwegian Code of Practice for Corporate Governance of 21 October 2009 issued by the Norwegian Corporate Governance Board (NUES).The report deals with the division of roles between shareholders, the Board of Directors and the day-to-day management team at Wilson, and compliance with the mentioned principles. Corporate governance is regularly discussed by the company’s Board of Directors.

Deviation from the recommendations

1. Wilson deviates from the recommendations in Section 7 concerning nomination committees for the reason that, owing to the company’s present concentrated shareholder structure, the Board of Directors does not deem it appropriate to have a nomination committee.

2. Wilson also deviates from the recommendations in Section 9 concerning the use of board committees. Wilson’s Board of Directors has no committees, with the exception of an audit committee.

Core values

As part of its corporate culture, Wilson has prepared and introduced core values and ethical guidelines for the company’s operations. Wilson’s core values are to be reliable, service-minded, professional, longsighted, sound, competitive and innovative. The employees shall reflect these core values in their conduct and in the work they do.

2. Activities

Wilson’s operations and activities are defined in the Articles of Association, which sets out the company’s objects as follows: “The Company’s business is to own, operate, manage and charter vessels, to engage in ship brokerage, clearance, commercial and agency activities, and industry, to own and manage real property, to conduct investment activities and to participate in other companies in Norway and abroad having similar objects”. The full text of the Articles of Association is available on the company’s website.

Within the scope of these objects, the company has focused its business concept on offering Norwegian and European industry competitive, secure, reliable, flexible and long-term maritime transport services, primarily in the field of dry cargo affreightment.

Wilson has a growth strategy, with “growth” defined as an increase in the fleet’s available earning days and with the objective as steady growth relative to the market. Since 2005, the number of earning days in the core business Wilson Euro Carriers has increased from around 26 500 to around 29 000 in 2009, which represents an annual growth of about 3 %, also taking into account the decrease in capacity caused by vessels being laid up in the past year owing to the difficult state of the market.

3. Share capital and dividend

Wilson’s objective in terms of financial strength is to have book equity equal to at least 30 % of the balance sheet total on a consolidated basis. Considerable volatility in the currency markets has resulted in major unrealised changes in value for the company’s foreign currency loans and financial instruments. The company will take such unrealised changes in value into account in connection with reconciliation against the target figures.

Wilson wishes to generate a good, stable return for its shareholders. Return on shareholder capital, or shareholder value, is defined as the total of share price performance and dividends. Shareholder value should reflect the economic development of the company. In the case of direct yield in the form of dividends, Wilson’s aim is to pay an annual dividend of 25-30 % of profit after tax. This objective will be assessed against the company’s growth ambitions in cyclical upturns and solidity/solvency performance in cyclical downturns, as well as the effect of unrealised items on profits. As a result of 2009 being an extremely difficult year in the market, Wilson’s liquidity came under pressure and the company was granted deferral of the downward adjustment of a loan facility totalling MNOK 45.The downward adjustment, which should have taken place in December 2009, has been deferred until 2011 and 2012.The company has been ordered by the lender not to pay a dividend until the deferred downward adjustment has taken place.

The General Meeting has not authorised the company to purchase own shares. At an Extraordinary General Meeting on 18 December 2009, the Board of Directors was authorised to raise a convertible bond loan where any new shares from the conversion may not exceed a maximum of 10 000 000 new shares, i.e. equal to around 24 % of issued shares at the current time. The authorisation will remain valid until the Annual General Meeting in 2011 and has to date not been used.

4. Equal treatment of shareholders and transactions with related parties

Wilson has only one class of share.

The company did not trade in its own shares in 2009.

In connection with the payment of the final dividend for 2008, the company agreed with the principal shareholder, Caiano AS, to delay payment of MNOK 20 of their dividend, out of a total dividend of MNOK 38.The agreement has been converted to a long-term loan on commercial terms.

Wilson has a loan offer amounting to MNOK 75 or equivalent value in EUR from Caiano AS and will enter into a final agreement in March 2010. Interest will be charged on the loan at market rates and the loan will be an interest-only loan for three years.

Transactions with related parties are shown in Note 20 to the consolidated financial statements.

Minority shareholders in the subsidiary Nesskip declared put options during 2009 in accordance with agreement. Details of the agreement are provided in Note 23 to the consolidated financial statements.

5. Free transferability

The shares in Wilson ASA can be freely transferred, and no limit to such transfer is laid down in the Articles of Association.

6. General Meeting

The Annual General Meeting of Wilson ASA is normally held during the second quarter. Shareholders with registered addresses are convened by mail, while working documents are made available on the company’s website. Enclosed with the meeting notice is a registration form for attendees and a proxy form for shareholders who are unable to attend. The Annual General Meeting is announced simultaneously to the stock exchange and on the company’s website. The members of the Board of Directors and the auditor are normally present at the Annual General Meeting.

7. Nomination committee

The company has no nomination committee. With the current concentrated shareholding structure, the company does not deem it necessary to have a nomination committee.

8. Corporate Assembly and Board of Directors; their composition and independence

Wilson has no corporate assembly. As of 31 December 2009, the company had 151 office staff, of whom 102 are employed at the company’s head office in Bergen and 49 at the various offices located abroad.

The company’s Board of Directors shall consist of 5-8 members elected by the General Meeting for a period of two years. The CEO is not a member of the Board.

As of 31 December 2009, the Board of Wilson ASA was composed of two women and four men, one of whom is the employee representative. Deputy board members are also elected as well a personal deputy for the employee representative. Of the six board members, five are thus elected by the shareholders. All the shareholder-elected board members are independent of the company’s day-to-day management and significant business associates. Three of the shareholder-elected members are furthermore independent of the company’s principal shareholder.

Details of the board members’ background and experience are published on the company’s website. An overview of board members’ shareholdings is provided in Note 7 to the consolidated financial statements.

9. The work of the Board of Directors

The Board establishes an annual plan of work. Normally, seven or eight ordinary board meetings are held during the course of a year. To date the company has not used committees of any kind to prepare business for board meetings, although the Board has now established an audit committee in accordance with the applicable legislation. The work done by the Board, and its competence and composition, are evaluated regularly by the Board itself.

10. Risk management and internal control

All employees shall uphold and maintain security and quality levels established by and for Wilson at all times. Ethical guidelines have been established for the office staff, including a duty of compliance with laws and regulations. Management and organisation of the business operations are reported to the Board. Wilson has defined the processes to be employed in the operating activities and has documented procedures for their compliance.

Financial risk areas are defined and security measures implemented in accordance with the company’s guidelines. For financial reporting, budgetary controls are used, as well as variance analyses, division of tasks and descriptions of procedures. A separate controller function has been established in the business’s core area.

The company’s auditor carries out regular reviews of internal control areas of systems related to auditing. The auditor’s recommendations are presented to the Board. Wilson is furthermore certified under the International Safety Management (ISM) Code for the safe operation of ships, and the certifying body regularly audits the business.

11. Remuneration to the Board

Remuneration to board members is determined by the Annual General Meeting. The remuneration reflects the responsibilities, competence, time spent on business and complexity of the business dealt with by the Board and is not dependent on results. The board members have not been allotted share options. Remuneration paid to the Board in 2009 is shown in Note 7 to the consolidated financial statements.

12. Remuneration to senior executives

The Board has established guidelines for remuneration to senior executives. The main principle for setting management pay at Wilson is that senior executives should be offered competitive pay and conditions in order to retain key staff and create continuity in the management.

The remuneration package offered to senior executives will normally consist of basic salary, pension benefits and car allowance. The Board also makes an annual assessment of whether to pay bonus to the company’s office staff, including senior executives. The performance-related element of the remuneration package may be up to two months’ salary per year. In the case of the CEO, the performance-related element may be up to three months’ salary per year. The level of the overall package will reflect Wilson’s aim to offer a salary level that is commensurate with the average salary level in similar shipping companies in Norway.

The guidelines set by the Board are presented annually to the General Meeting for approval.

There are no share option programmes for employees.

Remuneration to the CEO is determined by the Board. The total remuneration paid to the CEO for 2009 appears in Note 7 to the consolidated financial statements. The CEO determines the remuneration paid to senior executives, excluding bonus.

13. Information and communication

Wilson publishes interim (quarterly) and annual financial statements in accordance with the financial calendar as communicated to the market and as reproduced on the company’s website. Financial information and other regulatory information submitted to the securities market is distributed via the information service Hugin.

Wilson maintains a self-imposed “quiet period” for two weeks prior to the publication of interim results, during which contact with external analysts, investors and journalists is kept to a minimum. Company insiders have a self-imposed prohibition on trading in the Wilson share during these periods.

The company aims to supply the securities market and other interested parties with relevant and timely information in order to assist a correct perception of the company and to give investors a full and complete basis on which to make decisions to purchase or sell the company’s shares.

14. Takeovers

In the event of a takeover bid for the company, the Board will assess the bid either on an independent basis or by engaging independent financial advisers, and then give its recommendations as to whether the shareholders should accept the bid or not. The Board will work to ensure that any takeover bid is presented to all the shareholders on equal terms.

With the exception of the authorisation granted to the Board on 18 December 2009 to raise a convertible bond loan, the Board has not been granted authority to increase the company’s share capital and it would be unnatural to request such authority from the General Meeting following a possible takeover bid for the company.

15. Auditor

The company’s auditor participates in board meetings as required and is always present at the meeting that deals with the annual report and financial statements. At this meeting the auditor reviews any significant changes in the company’s accounting policies, and evaluates significant accounting estimates and any lack of agreement between the auditor and the administration.

The auditor also makes an annual audit of the company’s internal controls and presents a plan for conducting the audit work. The Board and the auditor hold one meeting annually at which the CEO or other representatives from the administration are not present.

The fees paid to the auditor are split into auditing and other services, and appear in Note 7 to the consolidated financial statements. This information is also reviewed at the company’s Annual General Meeting, which the auditor attends.