Articles of Association

Articles of association of Horn Invest hf.

Chapter I
Name, Domicile and Purpose of the Company

Article 1
The Company is a public limited company with the name Horn Fjárfestingarfélag hf. The company's foreign trading name is Horn Invest hf.

Article 2
The address of the Company is Borgartún 25, 105 Reykjavík.

Article 3
The purpose of the Company is investment activity, administration of financial instruments, operating of holding companies and real estate, lending activities and related activities.

Chapter II
Company's Share Capital

Article 4
The Company's share capital shall be ISK 1,000,000,000 - ISK one billion (bn) - nominal value and composed of as many shares with a nominal value of ISK 1 each.

Article 5
Only a shareholders' meeting may approve an increase in share capital, either by new subscriptions or through the issue of bonus shares. Shareholders shall have right of priority to all new shares in proportion to their registered shareholdings. Derogations from this provision are authorised by the third paragraph of Article 34 of Act No. 2/1995, on Public Limited Companies. A shareholders' meeting shall determine the terms of any increase in share capital, including the price of shares and payment terms, in accordance with Articles 36 and 37 of the Act on Public Limited Companies.

Only a shareholders' meeting can take a decision to reduce share capital.

Article 6
The Company's shares are de-materialised, as provided for in the Act on Electronic Registration of Title to Securities. The shareholders' registry, as provided for in the Act on Electronic Registration of Title to Securities, shall be regarded by the Company as fully valid proof of ownership rights to shares in the Company and any dividend payments, as well as all notifications, shall be sent to the party currently recorded in the Company's shareholders' registry as the owner of the respective shares.

Article 7
No restrictions are placed on shareholders' rights to sell their shares. The Act on Electronic Registration of Title to Securities and rules adopted by virtue of this Act, shall apply to transfers of ownership and their implementation.

Article 8
Shareholders are obliged, without any specific undertaking on their behalf, to abide by the Company's Articles of Association as they now stand or are subsequently amended in lawful fashion. Shareholders may not, however, be obliged to increase their shareholding in the Company, either by the Articles of Association or by amendments to them.

Shareholders bear no responsibility for the Company's obligations above and beyond their share in the Company unless they assume such obligations through a specific legal instrument. No decision of any type by a shareholders' meeting may amend this provision.

Article 9
No privileges are conferred by shares in the Company.

Shareholders are not subject to mandatory redemption of their shares, except as provided for by law.

Article 10
Electronic exchange of documents and email are permissible forms of communication between the Company and shareholders and shall be equally valid to regular post and physical documents. This authorisation extends to all exchanges between the Company and shareholders, including announcing shareholders' meetings, payment of dividends or other announcements that the Board of Directors may decide to send to shareholders. Such electronic communication shall be equivalent to paper notifications.

The Board of Directors shall set rules to govern the implementation of electronic communication and set out specifications of the software made available to shareholders. Shareholders intending to avail themselves of electronic communication with the Company in accordance with the above shall confirm their intention based on rules set by the Board.

Article 11
The Company may not make loans secured by its shares unless such is permitted by law.

Chapter III
Own Shares

Article 12
The Company may not hold more than 10% of own shares. Voting rights may not be exercised for those shares owned by the Company itself.

The Company may only acquire its own shares in accordance with an authorisation to the Board by a shareholders' meeting. An authorisation to the Board to purchase own shares may not be valid for longer than 18 months at a time. The Rules of Procedure of the Board shall contain provisions on the purchase and sale of own shares.

If the Company acquires more than 10% of own shares the surplus shall be sold within six months. If the surplus shares cannot be sold, the share capital shall be decreased.

Chapter IV
Shareholders' Meeting

Article 13
Final authority in all Company dealings rests with the duly constituted shareholders' meeting.

Shareholders, their proxies and advisors, the Company's auditor, its managing director and employees shall be entitled to attend shareholders' meetings.

A shareholder may appoint a proxy to attend a shareholders' meeting on his/her behalf. A proxy must produce a dated written or electronic power of attorney. A proxy's power of attorney cannot effectively be withdrawn once it has been submitted along with meeting documents or the shareholders' meeting has been convened, whichever takes place first. A shareholder may attend meetings accompanied by an advisor and may authorise the advisor to speak on his/her behalf. An advisor shall not have the right to make a motion or vote at a shareholders' meeting.

The Company's auditor and managing director shall have full rights to speak and make motions at shareholders' meetings, even if they are not shareholders. The Company's managing director may invite experts to attend certain shareholders' meetings, if their opinion or assistance is required. Employees shall not have the right to speak, make motions or vote at shareholders' meetings.

Article 14
The Annual General Meeting shall be held before the end of April each year.

The Annual General Meeting shall be called with a notice in daily newspapers, or by other verifiable means, with at least three weeks' notice. The agenda of the meeting shall be specified in the announcement.

An Annual General Meeting shall be properly constituted if it has been lawfully convened, regardless of how many people attend.

Article 15
The following items shall be dealt with at the Annual General Meeting:

1. a report from the Board of Directors on Company activities during the past operating year;
2. the annual financial statements for the past operating year, together with a report from the auditor, shall be placed before the meeting for attestation;
3. a decision on the payment of a dividend and disposition of profit or loss from the past accounting year;
4. the Board of Directors proposes a remuneration policy and submits it to the meeting for approval;
5. a motion authorising the Company's Board of Directors to purchase own shares;
6. motions for amendments to the Articles of Association, if any have been received;
7. proposals by the Nomination Committee;
8. election of the Board;
9. election of the auditor;
10. a decision on remuneration to members of the Nomination Committee and remuneration to directors for the next term of office; and,
11. other business.

Article 16
Extraordinary shareholders' meetings shall be held whenever the Board of Directors deems it necessary, in accordance with a resolution, or if the elected auditor or shareholders controlling at least one-tenth of the share capital so request in writing, specifying the subject of the meeting; in such case an extraordinary shareholders' meeting must be called within two weeks' of receipt of such request by the Board of Directors.

An extraordinary shareholders' meeting shall be announced with at least three weeks' notice and no more than three weeks' notice. If all shareholders, or their proxies, are present, they may grant an exception to this provision. An extraordinary shareholders' meeting shall be announced by advertisement in daily newspapers or by other verifiable means. The same rules concerning legal constitution shall apply to extraordinary shareholders' meetings as apply to the Annual General Meeting, cf. the second paragraph of Article 14 of these Articles.

Article 17
The Board of Directors may conduct shareholders' meetings electronically, either in part or entirely.

If the Board of Directors deems available equipment secure enough to hold meetings electronically and thus decides to avail itself of the authorisation provided in Paragraph 1, special mention should be made of this arrangement in the announcement of the meeting. Information on required technology, how to announce participation, the arrangement of voting, directions regarding the conferencing system and password required to access the meeting, as well as other relevant information, shall be included in the announcement of the meeting. Entering the password in the specified conferencing system shall be equivalent to the shareholder's signature and is regarded as confirmation of his/her participation in the meeting.

Shareholders intending to participate in shareholders' meetings which the Board has decided to convene electronically in accordance with Paragraph 1, shall notify the Company's office at least five days in advance and at the same time submit written questions or, as the case may be, any documents they wish to submit to the meeting.

If, in the opinion of the Board, it is not practicable to invite shareholders to participate in electronic shareholders' meetings, shareholders shall be invited to vote on proposals or participate in elections via mail. The announcement of the meeting shall include a description of voting procedures. Shareholders can request to have voting ballots sent to them by mail and must submit such requests to the Company's office at least five days prior to the advertised shareholders' meeting. Shareholders can also collect their ballots from the Company's office as of the same time limit or vote on the premises.

Article 18
Any shareholder is entitled to have a specific matter dealt with at a shareholders' meeting, if he/she submits a written request for such to the Board with sufficient notice to allow this to be placed on the agenda of the meeting as provided for in these Articles of Association.

The announcement of the meeting shall list the items of business to be discussed at the shareholders' meeting. No later than one week prior to a shareholders' meeting the agenda, final motions, as well as the annual financial statements, report from the Board of Directors and auditor's report and nominations from the Nomination Committee in the case of an AGM, shall be published on the Company's website.

Items which have not been listed on the agenda of a shareholders' meeting may not be resolved at the meeting. Even if an item was not listed on the meeting agenda, this shall not preclude the calling of an extraordinary shareholders' meeting to discuss this item; in addition, an Annual General Meeting may always finalise items which it is required to handle by law or the Articles of Association.

Supplementary motions or amendments, legally submitted, may be raised at the meeting itself despite not having been available to shareholders beforehand.

Article 19
The Chairman of the Board of Directors or elected Chairman of the meeting shall preside over a shareholders' meeting and the election of a meeting Secretary. The meeting Chairman shall, upon the commencement of the meeting, check whether it has been lawfully convened and is legally constituted in other respects and declare whether such is the case. He/She shall direct all discussion and voting.

Once the meeting is in session, a list of the shareholders and their proxies attending the meeting shall be compiled, in order to clarify how many shares and votes each of them controls.

Article 20
The meeting Secretary shall take minutes of the meeting. Decisions by the shareholders' meeting, together with voting results, shall be recorded in the minutes. A list of the shareholders present and their proxies shall be entered in the minutes or accompany them. The minutes shall be read aloud prior to the end of the meeting and any comments made recorded therein. The Chairman and Secretary of the meeting shall sign the minutes.

The minutes of the meeting or a certified copy of the minutes shall be available at the Company's office no later than two weeks after the shareholders' meeting. Minutes of meetings shall be preserved securely.

Recorded minutes shall be conclusive proof of what has taken place at meetings.

Article 21
Each króna of share capital shall entitle the owner to one vote at shareholders' meetings.

A majority of votes shall determine the outcome at shareholders' meetings, unless otherwise provided for by national law or these Articles. In the case of a tied election or vote, the motion shall be considered rejected. Voting and election shall be by secret ballot if any of the voting shareholders attending the meeting so demands.

Chapter V
Board of Directors

Article 22
The Company's Board of Directors shall consist of five persons and one alternate director, elected at the annual general meeting for a one year term at a time. The eligibility of Board members shall be as provided for by law.

Article 23
A special Nomination Committee shall nominate five candidates to serve as directors.

The Committee shall be appointed each year and consist of five persons. The Company's five largest shareholders, according to the Company's shareholders' registry on 1 October each year, shall have the right to appoint a Committee member, and, in addition, the Chairman of the Company's Board of Directors shall sit on the Committee. Should one of the five largest shareholders waive its right to appoint a Committee member or fail to respond to the Company's request to do so within one month, the sixth largest shareholder shall be offered the chance to appoint a Committee member, and then the next largest and so on and so forth. Appointments to the Committee shall be announced on the Company's website once the Committee is fully manned and no later than 3 months prior to the AGM.

In its work, the Committee shall have regard for the Company's interests and as such, the overall interests of its shareholders. The Committee shall endeavour to ensure that the Company's Board of Directors as a whole possesses relevant education, knowledge and experience of financial markets.

The Committee shall adopt its own rules of procedure, prescribing its main tasks. No special payment shall be made to Committee members by the Company.

This Article may only be amended if shareholders controlling at least nine-tenths of the share capital represented at a shareholders' meeting so agree.

Article 24

Those persons willing to stand for election to the Board of Directors shall give notice thereof in writing to the Nomination Committee no later than three weeks prior to the commencement of the AGM.

In the notification to the Nomination Committee the candidate shall include, in addition to his/her name, Id. No. and address, information about his/her main occupation, Board membership, education, experience, shareholdings, connected interests with its main customers and competitors as well as shareholders holding more than 10% of shares in the Company.

The Committee's nominations to the Company's Board of Directors shall be included in the AGM announcement. All key information on the candidates shall be published on the Company's website along with the Committee's rationale and evaluation of independence of candidates to the Board.

Any notifications of candidacy received after the Committee publishes its nominations and within five days before the AGM shall be announced on the Company's website. Information on all candidates to the Company's Board of Directors shall be made available to shareholders at the Company's offices no later than two days prior to the AGM.

Article 25
Election to the Board of Directors shall be a majority vote between individuals.

Elections to the Board shall as a rule be by secret ballot if the number of nominations exceeds the number of Members to be elected.

If shareholders in the Company exceed 200 or more and shareholders controlling at least one-tenth of the share capital so request, election to the Board shall be by proportional or cumulative voting. If shareholders are fewer than 200, the request must be made by shareholders controlling at least one-fifth of shares. If more than one group of shareholders sets forth diverging requests for proportional and cumulative voting, the latter shall be adopted. Such requests must be submitted to the Company's Board of Directors no less than five days prior to an AGM.

Article 26
The Board shall elect a Chairman and divide responsibility for other tasks between members as deemed necessary.

The Chairman shall call Board meetings and direct them. A meeting shall be held whenever the Chairman deems it necessary. In addition, the Chairman is obliged to call a meeting of the Board of Directors if one of the directors or the managing director so requests. Board meetings shall be called with at least 24 hours' notice. It shall constitute a quorum if a majority of the Board members are in attendance. Questions shall be decided by a majority of votes. In the case of a tie, the Chairman's vote shall determine the outcome.

The Board of Directors shall have minutes taken of Board meetings and attest them with their signatures.

Article 27
The Board of Directors shall be ultimately responsible for the Company's activities, as provided for in the relevant legislation, rules and the Articles of Association, and shall supervise its operations.

The Board shall adopt its own rules of procedure, providing in detail for the implementation of its tasks. These rules shall describe the division of responsibilities among directors, areas of responsibility of the Board, its Chairman and the managing director, announcement of shareholders' meetings, the frequency, participants and arrangement of such meetings, authority of directors to take decisions and voting arrangements, meeting documents and minutes, sub-committees of the Board, their duties and decision-making authority, implementation of a performance assessment to be carried out yearly, gathering and disclosure of information from the managing director and sub-committees to the Board, confidentiality, ineligibility, connections to other Company rules, e.g. corporate governance guidelines, and other relevant rules, e.g. issued by the Financial Supervisory Authority or Exchange rules.

Only the majority of the Board of Directors may grant authority to sign for the Company.

Article 28
If sub-committees are elected by the Board of Directors in accordance with its rules of procedure their recommendations shall function as guidelines only; the Board shall not be bound by their recommendation in individual cases unless otherwise prescribed by law.

Chapter VI
Managing Director

Article 29
The managing director of the Company is authorised to sign for the Company and oblige it. The Board of Directors shall engage the managing director and determine the terms of employment in accordance with law. The managing director shall meet all qualifications currently provided for by the Limited Companies Act.

The Board of Directors shall approve the appointment of a deputy managing director, in accordance with a proposal from the managing director. The Board of Directors shall adopt rules on the division of tasks between the Board of Directors and the managing director, in accordance with provisions of the Act on Limited Companies.

The managing director shall attend meetings of the Board of Directors, unless the Board decides otherwise. The managing director shall implement decisions taken by majority at meetings of the Board of Directors.

The managing director shall be in charge of the Company's day-to-day operations and is authorised to oblige it. The managing director takes decisions on the authority of individual employees to oblige the Company in accordance with rules set by the Board. He/She represents the Board in all matters concerning regular operations. The managing director shall consult with the Board on all unusual and material arrangements.

He/She shall be responsible for record keeping and hiring of staff. The managing director shall provide members of the Board and auditors with all information concerning Company operations which they may request and are entitled to by law.

Chapter VII
Accounts and Auditing

Article 30
At the Annual General Meeting, a certified public accountant or accounting company shall be elected as the Company's auditor for one year at a time. The Auditor shall examine the Company's accounts and all the accounting documents for each year of operation and shall have access to all the Company's records and documents for such purpose.

The Auditor shall meet all the qualifications currently provided for by law.

Article 31
The Company's accounting year shall be the calendar year. The Board of Directors and managing director shall prepare the annual financial statements and the annual report each year. The annual financial statements and annual report shall form a single document.

The annual financial statements shall be compiled in accordance with laws, regulations and good accounting practice, both with regard to assessments of various items, structure, breakdown, notes and terminology.

Article 32
The auditor shall audit the Company's annual financial statements as provided for by law and generally accepted auditing standards. Following the audit, the auditor shall attest to the annual financial statements; such attestation shall accompany the accounts as his report. The annual financial statements and the Auditor's report shall be available for inspection by shareholders for at least one week before the Annual General Meeting.

In other respects, the provisions of this Chapter shall apply to the Company's consolidated accounts as appropriate.

Chapter IX
Amendments to the Company's Articles of Association

Article 33
Only a legally constituted shareholders' meeting may amend the Company's Articles of Association, excepting amendments otherwise authorised by the Act on Limited Companies and these Articles. Any decision on amending the Articles shall only be valid if it receives the approval of at least two-thirds of the votes cast, and furthermore the approval of shareholders controlling at least two-thirds of the share capital represented at a meeting, unless otherwise provided for in these Articles.

The approval of all shareholders is required to validate the following amendments to these Articles:

1. Diminish the right of shareholders to dividend payment or other disbursement by the Company, for the benefit of others than shareholders.
2. Increase the obligations of shareholders to the Company.
3. Limit the authority of shareholders to dispose of their shares in accordance with Articles 22 and 23 of the Act on Limited Companies or oblige shareholders to suffer redemption of their shares for any reason other than winding up of the Company.

A decision to amend the Articles in a way that diminishes the right of shareholders to dividend payments or other disbursement by the Company, provided that Point 1 of the first paragraph of Article 94 of the Act on Limited Companies does not apply, shall only be valid if shareholders controlling at least nine-tenths of the share capital represented at a shareholders' meeting so agree.

A decision to amend the Articles in a manner that affects the legal relationship of shareholders, e.g. voting rights and equality among shareholders, shall only be valid if approved by shareholders controlling at least nine-tenths of all share capital, cf. Article 94 of the Limited Companies Act.

Chapter X
Winding Up and Merger of the Company

Article 34
The votes of shareholders controlling at least nine-tenths of the total share capital of the Company are required for a decision on its winding up or merger to be valid.

A shareholders' meeting, which has taken a legal decision on the winding up of the Company, shall also decide on the disposal of its assets and payment of debts. A shareholders' meeting shall elect a two-person resolution committee to administer the winding up of the Company in accordance with provisions of legislation on limited companies.

Chapter XI
General Provisions

Article 35
Any matters not covered by the provisions of these Articles shall be dealt with in accordance with the provisions of the Act on Limited Companies, or other legal provisions which may apply.

Thus adopted at a shareholders' meeting in Reykjavík on 11.11.2011.

On behalf of Horn Investment Company hf.
Hermann Már Thórisson
Managing Director