2013 Annual Annual-Information-Form 351

8/9/2019 2013 Annual Annual-Information-Form 351

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SNCLAVALIN GROUP INC.

ANNUAL INFORMATION FORM

Yea Eded Decembe 31, 2012

Mach 8, 2013


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TABLE OF CONTENTS

1. CORPORATE STRUCTURE ....................................................................................................................4

1.1 INCORPORATION OF THE CORPORATION....... ............... ........... ............... .............. ........... ........ 4

1.2 SUBSIDIARIES, JOINT VENTURES AND ASSOCIATES................ .............. ............ .............. ........... 4

2. GENERAL DEVELOPMENT OF THE BUSINESS......................... ........... .............. .............. ............... ......... 6

3. DESCRIPTION OF THE BUSINESS.................. .............. .............. .............. ............ .............. ............ ...... 10

3.1 GENERAL...............................................................................................................................10

Competitive Conditions .............. .............. ............ .............. ............ .............. ............... .......... 12

Cash Management Polic.......................................................................................................12

Organiational Structure........................................................................................................12

3.2 REVENUE BACKLOG................ .............. ............ .............. ............ .............. .............. .............. .12

3.3 RISK FACTORS....................... ............ .............. .............. ............ .............. ............ .............. ..... 12

3.4 HUMAN RESOURCES.................... ............ ............. ............... ........... ............... ........... ............. 13

3.5 WE CARE VALUE STATEMENT............... ............... ........... ............... ........... ............... ........... 13

3.5.1 WellBeing of Emploees............................................................................................13

3.5.2 Health and Safet.......................................................................................................13

3.5.3 The Communities in Which We Live and Work............... ............... ........... ............... .... 143.5.4 Environment ..............................................................................................................14

3.5.5 Qualit .......................................................................................................................14

4. DIVIDENDS.......................................................................................................................................14

5. CAPITAL STRUCTURE .............. .............. ............ .............. ............ .............. .............. ............ .............. 15

General Description...............................................................................................................15

Common Shares ....................................................................................................................15

First Preferred Shares............................................................................................................15

Second Preferred Shares .......................................................................................................16

Credit Ratings........................................................................................................................16

Fees Paid to Credit Rating Organiations................................................................................17

6. MARKET FOR SECURITIES.............. ............... ........... ............... ........... .............. ............... ........... ........ 17Market..................................................................................................................................17

Trading Price and Volume......................................................................................................17

7. DIRECTORS AND OFFICERS.................................................................................................................19

8. LEGAL PROCEEDINGS.................. .............. ............... .............. ............ .............. ............ .............. ....... 24

Class Action Lawsuits.............................................................................................................24

Other ..................................................................................................................................24

9. AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN AGREEMENT............... .............. ........... ...... 25

10. TRANSFER AGENT AND REGISTRAR... .............. .............. ............ .............. ............ .............. ............. ... 25

11. EXPERTS...........................................................................................................................................25

12. AUDIT COMMITTEE ............. ............... ........... ............... ........... ............... .............. ........... ............... .. 25

Mandate of the Audit Committee....... ............... ........... ............... .............. ........... ............... .. 25

Composition of Audit Committee ............... .............. ........... ............... ........... ............... ......... 25

Relevant Professional Qualifications and Experience of Audit Committee Members....... ........ 25

PreApproval Policies and Procedures.................. .............. .............. .............. ............ ............ 26

Auditors Fees .......................................................................................................................26

13. CAUTION REGARDING FORWARDLOOKING STATEMENTS............. .............. ........... ............... ........... 27

14. ADDITIONAL INFORMATION.... .............. .............. ............... .............. ............ .............. ............ .......... 29

SCHEDULE A MANDATE OF THE AUDIT COMMITTEE....... .............. ............ .............. .............. ............ .......... 30


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1. CORPORATE STRUCTURE

1.1 INCORPORATION OF THE CORPORATION

SNCLavalin Group Inc. (the Cai) was incorporated under the laws of Canada on Ma 18, 1967 andwas continued under the C B Corporations Act (CBCA) on March 24, 1980. The articles of the

Corporation were amended on several occasions, including for the following purposes: the split (in 1996) of its

outstanding shares on a threeforone basis, the implementation of a Shareholder Rights Plan, the change of

its name, the creation of new classes of shares and the reorganiation of its outstanding share capital, the

modification of the maximum number of directors (the Diec), the addition of a requirement that at

least ⅔ of the Directors must not be emploees of the Corporation or its affiliates and the redesignation of its

class A subordinate voting shares as common shares.

On March 8, 2013, the Board of Directors of the Corporation adopted a resolution to amend the articles of the

Corporation so as to permit the appointment b the Board of Directors of one or more additional Directors to

hold office until the close of the next annual meeting of shareholders, subject to the total number of directors

so appointed not exceeding ⅓ of the number of directors elected at the previous annual meeting ofshareholders, in accordance with Section 106(8) of the CBCA. A special resolution on the matter will be

submitted to the shareholders of the Corporation for adoption at the Annual and Special Meeting of

Shareholders to be held on Ma 2, 2013.

The Corporations head and registered office is located at 455 RenLvesque Boulevard West, Montreal,

Quebec, Canada H2Z 1Z3.

Reference in this Annual Information Form to Cma or to SNCLaali means, as the context ma

require, the Corporation and all or some of its subsidiaries or joint ventures, or the Corporation or one or

more of its subsidiaries or joint ventures.

1.2 SUBSIDIARIES, JOINT VENTURES AND ASSOCIATES

The chart appearing on the next page lists the main subsidiaries, joint ventures and associates of SNCLavalin,

as well as the principal infrastructure concession entities in which the Corporation participates, their

jurisdiction of incorporation (which is Canada or an of the provinces or territories, unless otherwise

indicated) and the percentage of voting shares beneficiall owned, or controlled, or directed, directl or

indirectl b SNCLavalin.


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Peceage f ig

eciie held

Sbidiaie, Ji Vee ad Aciae

Candu Energ Inc. (C) 100% Ÿ

407 East Construction General Partnership (C) 50% ◊

DBA Engineering Ltd. () 100% Ÿ

Evergreen Rapid Transit Holdings Inc. (A) 100% Ÿ

Groupe Qualitas Inc. () 100% Ÿ

Groupe Stavibel Inc. (C) 100% Ÿ

Infrastructure Famille Sant Inc. (C) 100% Ÿ

IntecsaInarsa, S.A. () 100% Ÿ

Interfleet Technolog Limited (.K.) 100% Ÿ

Itansuca Proectos de Ingenieria S.A. (C) 100% Ÿ

JV Vault (C) 50% ◊

MDH Engineered Solutions Corp. () 100% Ÿ

Marte Engenharia Ltda (B) 100% Ÿ

Minerconsult Engenharia Ltda (B) 100% Ÿ

Nexacor Realt Management Inc. (C) 100% Ÿ

OAO VNIPIneft () 48% ♦

P.T. SNCLavalin TPS (I) 95% Ÿ

S.A. SNCLavalin N.V. (B) 100% Ÿ

SLNAecon JV (C) 50% ◊

SNCLavalin (Malasia) Sdn. Bhd. (M) 100% Ÿ

SNCLavalin (Shanghai) International

Trading Co. Ltd. (C) 100% ŸSNCLavalin Aroports S.A.S.U. (F) 100% Ÿ

SNCLavalin Algrie EURL (A) 100% Ÿ

SNCLavalin Angola Lda (A) 100% Ÿ

SNCLavalin Arabia LLC ( A) 100% Ÿ

SNCLavalin ATP Inc. (C) 100% Ÿ

SNCLavalin Australia Pt. Ltd. (A) 100% Ÿ

SNCLavalin Capital Inc. (C) 100% Ÿ

SNCLavalin Chile S.A. (C) 100% Ÿ

SNCLavalin Construction (Atlantic) Inc. (C) 100% Ÿ

SNCLavalin Construction Inc. (C) 100% Ÿ

SNCLavalin Construction (Ontario) Inc. (C) 100% Ÿ

SNCLavalin Construction International SAS (F) 100% Ÿ

SNCLavalin Constructors Inc. (D) 100% Ÿ

SNCLavalin Constructors International Inc. (C) 100% Ÿ

SNCLavalin Constructors (Pacific) Inc. (C) 100% Ÿ

SNCLavalin Defence Programs Inc. (C) 100% Ÿ

SNCLavalin Engineering India Private Limited (I) 100% Ÿ

SNCLavalin Engineers & Contructors, Inc. () 100% ŸSNCLavalin Eurasia OOO () 100% Ÿ

SNCLavalin Europe B.V. (N) 100% Ÿ

SNCLavalin Europe S.A.S. (F) 100% Ÿ

SNCLavalin Evergreen Line Holdings Limited (A) 100% Ÿ

SNCLavalin Graham Joint Venture (C) 50% ◊

SNCLavalin Gulf Contractors LLC ( A E) 49% ♦

SNCLavalin Inc. (C) 100% Ÿ

SNCLavalin International Inc. (C) 100% Ÿ

SNCLavalin International Inc. and Zuhair Fae

Engineering Consultancies Compan ( A) 50% ◊

SNCLavalin International S.A.S. (F) 100% Ÿ

SNCLavalin Nuclear Inc. (C) 100% Ÿ

SNCLavalin Operations & Maintenance Inc. (C) 100% Ÿ

SNCLavalin Peru S.A. () 100% Ÿ

SNCLavalin Pharma Inc. (C) 100% Ÿ

SNCLavalin Polska Sp. Z o.o. () 100% Ÿ

Sbidiaie, Ji Vee ad Aciae (cied)

SNCLavalin Romania S.A. () 100% Ÿ

SNCLavalin S.A.S. (F) 100% Ÿ

SNCLavalin Services Ltd. (C) 100% Ÿ

SNCLavalin South Africa (Proprietar)Limited ( A) 100% Ÿ

SNCLavalin UK Limited ( K) 100% Ÿ

Socit dexpertise et dingnierie L.G.L., S.A. (H ) 33.3% ♦

The SNCLavalin Corporation (D) 100% Ÿ

Iface Ccei Ieme

407 East Development Group General Partnership ( ) 50% ♣

407 International Inc. () 16.77% ♣

AltaLink, L.P. (A) 100% ♣

Ambatov Minerals S.A. LLC (M ) 5% ♣

Astoria Project Partners LLC (N ) 21% ♣

Astoria Project Partners II LLC (N ) 18.5% ♣

Chinook Roads Partnership (A) 50% ♣

Groupe Immobilier Sant McGill, S.E.N.C. () 60% ♣

In Transit BC Limited Partnership (B C) 33.3% ♣

Malta International Airport p.l.c. (M) 15.5% ♣

Mah Tipaa S.p.A. ( A) 25.5% ♣

Okanagan Lake Concession Limited Partnership

(B C) 100% ♣

Ovation Real Estate Group (Quebec) Inc. () 100% ♣

Rainbow Hospital Partnership (N B) 100% ♣

Raalseema Expresswa Private Limited (I) 36.9% ♣

Shariket Kahraba Hadjret En Nouss S.p.A. (A) 26% ♣

Socit dExploitation de Vatr Europort S.A. (SEVE) (F) 51 .13% ♣

Socit dExploitation de lAroport de Maotte S.A.S. (F) 100% ♣

TC Dme S.A.S. (F) 51% ♣

Ÿ Subsidiar♦ Associate

♣ Investment entit

◊ Joint Venture


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2. GENERAL DEVELOPMENT OF THE BUSINESS

The highlights relating to the development of the Corporations business over the past three ears are

described below.

Rece Ee

Cae Sce ad Maageme Chage

On August 10, 2012, the Corporation announced that, effective October 1, 2012, Robert G. Card would

become its new President and Chief Executive Officer (the CEO), and a member of the Board of Directors.

Mr. Card has almost 40 ears of experience in the operations and management of infrastructure and energ

projects in the industr, including most recentl with a Fortune 500 engineering services firm with 30,000

staff, a presence in more than 80 countries and approximatel $6 billion in annual revenues.

Mr. Card replaced Ian A. Bourne, who, at the request of the Board of Directors, agreed to assume thefunctions of interim Chief Executive Officer (the Interim CEO) and ViceChairman of the Board of Directors,

following the announcement on March 26, 2012 that Pierre Duhaime had stepped down from his position as

Chief Executive Officer of the Corporation (the Former CEO) and as a director of the Corporation. Mr.

Bourne remains ViceChairman of the Board of Directors.

Under Mr. Card's leadership, the Corporation continues to assess and has begun to implement certain

structural changes within the organiation with goals, amongst others, to improve integration of products and

services throughout the Corporation and increase global geographical presence to complement the existing

global operating structure b sector of activit. As part of this process, the Corporation has also taken a

number of measures to further strengthen its management structure and extend its scope. These measures

include:

· Effective Januar 21, 2013, Neil Bruce assumed the newl created role of President, Resources &

Environment, and became a member of the Office of the President. This newl formed group includes

the Corporations global business in Hdrocarbons & Chemicals, Mining & Metallurg, Environment

and Water;

· As announced on Januar 18, 2013, a Global Operations group has been created. Christian Jacqui,

formerl Executive VicePresident, Europe, was assigned a new role as Executive VicePresident,

Global Operations. This role will oversee the globaliation of the Corporations operations to

complement the existing global operating structure b sector of activit;

· As announced on December 13, 2012, Gilles Larame, Chief Financial Officer (CFO) assumed

responsibilit as Executive VicePresident, Infrastructure, Concessions and Investments. The

Corporation has initiated a search to replace Mr. Larame as CFO. Mr. Larame will continue as CFOuntil his replacement is in place;

· The following individuals were named Office of the President members in 2012 and earl 2013:

Charles Chebl, Executive VicePresident Infrastructure and Construction, Dale Clarke, Executive Vice

President Mining and Metallurg, Rjean Goulet, Executive VicePresident and General Counsel, Ric

Sorbo, Acting Executive VicePresident, Hdrocarbons and Chemicals, and Scott Thon, Acting

Executive VicePresident, Power.

On Februar 22, 2013, the Corporation announced the appointment of the former Chief Compliance Officer of

Siemens AG, Andreas Pohlmann, as its Chief Compliance Officer, effective March 1, 2013.


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2012

Addii f Iface Ccei Ieme (ICI)

In Ma 2012, the Corporation announced that 407 East Development Group General Partnership, 50%owned

b SNCLavalin, was awarded a contract b the Province of Ontario, in Canada, to design, build, finance, and

maintain Phase 1 of the new highwa 407 East, which will add 32 kilometres to the existing highwa. The 407East Development Group General Partnership subcontracted the design and build as well as the operation and

maintenance portions to two partnerships 50%owned b SNCLavalin. Once construction is completed, the

407 East Development Group General Partnership will maintain and rehabilitate the road until 2045. The

Corporation committed to invest in this ICI an amount of $15.9 million in equit.

In June 2012, the Corporation acquired from India Infrastructure Fund an equivalent to 10% of the issued and

paid up capital of Piramal Roads Infra Private Limited, an entit that engages in the business of bidding for,

owning, acquiring, investing, developing, implementing and operating infrastructure, in the roads sector of

India, for a total cash consideration of approximatel $10 million.

Bie Aciii

In June 2012, the Corporation acquired DBA Engineering, an Ontariobased engineering firm specialiing in

material and pavement engineering, and geotechnical and geoenvironment studies. DBA Engineering had

approximatel 100 emploees at offices in Toronto, Kingston, Cambridge and Trenton, and provides services

to both public and private sector clients.

Fmai f a Ne Ji Vee

In June 2012, SNCLavalin International Inc. and Zuhair Fae Engineering Consultancies Compan, also known as

SNCLavalin Fae Engineering (SLFE), an engineering consultanc jointl controlled entit between SNCLavalin

and its partners in Saudi Arabia, acquired the industrial division of Zuhair Fae Partnership. SNCLavalin holds an

ownership interest of 50% in SLFE and will receive 35% of the distributions from SLFE during the first ten ears

and it will receive 50% of the distributions thereafter. SLFE was formed partl in response to Saudi Aramcos

General Engineering Services Plus (GES+) initiative, which aims to develop engineering capabilities in theKingdom of Saudi Arabia. SNCLavalin invested $40.3 million in SLFE in June 2012.

2011

Addii f Iface Ccei Ieme (ICI) ad iceaed ehi iee i ICI

In April 2011, Socit dExploitation de lAroport de Maotte S.A.S., a whollowned subsidiar of the

Corporation, entered into an agreement with the French government to upgrade the infrastructure and build

a new terminal building for the Maotte airport, on a French island located in the Indian Ocean. Socit

dExploitation de lAroport de Maotte S.A.S. also has the mandate to manage and maintain the airport, in

addition to assuming the commercial development, for a 15ear period. The Corporation committed to

invest in this ICI an amount of 10.6 million (approximatel $14 million) in equit.

In September 2011, SNCLavalin completed the acquisition of Macquarie Essential Asset Partnerships

(MEAP) 23.08% ownership interest in AltaLink for a total consideration of $228.8 million in cash. The

transaction increased the Corporations ownership of AltaLink from 76.92% to 100%. AltaLink has technical

expertise and extensive experience in Alberta, Canada, where it owns and operates regulated transmission

facilities, such as transmission lines and substations.

In September 2011, Rainbow Hospital Partnership (Raib), whollowned b SNCLavalin, was awarded a

publicprivate partnership contract b the Government of New Brunswick for the design, construction,

commissioning, financing and certain operation and maintenance functions of the new Restigouche Hospital


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Centre for pschiatric care in Campbellton, New Brunswick. Rainbow subcontracted the construction of the

new hospital to an SNCLavalinled joint venture. It will have 140 beds in seven inpatient units with facilities

for education and research, clinical support, and administration and general support services. It will also serve

as the forensic pschiatr facilit for the province. SNCLavalin Operations & Maintenance will provide the

operation and maintenance activities for the centre for a total of 30 ears.

Bie Aciii

In 2011, SNCLavalin completed the following business acquisitions, which added approximatel 2,900 people

to its workforce:

· Groupe Stavibel, a multidisciplinar consulting engineering firm based in AbitibiTmiscamingue,

Quebec. Groupe Stavibel provides engineering consulting expertise in numerous fields of activit in the

buildings, infrastructure, transport, mining, and environment sectors. The firm has approximatel 300

permanent emploees working in several offices throughout AbitibiTmiscamingue and in the Greater

Montreal area.

· Aqua Data, a compan of about 100 emploees specialiing in the computeried diagnosis and analsis

of water distribution sstems and wastewater collection sstems for municipal, commercial and

industrial clients. Formerl a subsidiar of Ga Mtro, Aqua Data has clients in Quebec, Ontario, the

Maritimes and the United States. Its head office is in Pincourt, Quebec, near Montreal.

· MDH Engineered Solutions, an engineering consulting and research firm based in Saskatoon,

Saskatchewan. MDH Engineered Solutions provides geoenvironmental, geotechnical, hdrogeological

and environmental engineering consulting services to the mining, oil and gas, transportation, utilit and

government sectors. The firm has approximatel 175 permanent emploees working in offices in

Saskatoon, Regina, Prince Albert and Esterha, Saskatchewan, and in Edmonton and Fort McMurra,

Alberta.

· Candu Energ Inc., a whollowned subsidiar of the Corporation, acquired certain assets of Atomic

Energ of Canada Limiteds (AECL) commercial reactor division. Approximatel 1,400 emploees

transitioned from AECL to Candu Energ Inc. In addition to the acquisition, Candu Energ Inc. will worktowards completing the Enhanced CANDU reactor (EC6) development program.

· Interfleet Technolog (Ieflee), an international rail technolog consultanc group headquartered

in Derb, United Kingdom. Interfleet specialies in rolling stock, railwa sstems, and strategic railwa

management and is wellknown for its detailed understanding of both national rail sstems and

international bestpractice. Interfleet has approximatel 600 emploees in 22 locations. Interfleet serves

public and private clients around the world from its offices in United Kingdom, Scandinavia, Central

Europe, Australasia, India and North America.

· Arcturus Realt Corporation (Ac), an entit that manages over 35 million square feet of office,

retail and industrial properties in Canada. With over 350 emploees, Arcturus provides a comprehensive

scope of real estate services including propert management, leasing, development advisor services

and facilities management. Its client base consists of financial institutions, insurance companies, major

retailers, public sector and private investors.

· Harder Associates Engineering Consulting, an engineering consulting firm based in Fort St. John, British

Columbia. Harder Associates Engineering Consulting provides consulting services in construction,

upstream oil and gas, and environmental and geotechnical fields. The firm has 16 emploees working in

offices in Fort St. John and Fort Nelson, British Columbia, and Grande Prairie, Alberta.


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2010

Addiial ICI

Chinook Roads Partnership (Chik), held b SNCLavalin and Acciona S.A., entered into a contract with

Alberta Transportation to design, build, operate, maintain, and partiall finance the southeast section of

Calgars Stone Trail Ring Road in Canada. Upon signing the contract with Alberta Transportation, Chinooksubcontracted the engineering, procurement, and construction (EPC), and the operation and maintenance

(O&M) work to joint ventures 50% owned b SNCLavalin. The construction is expected to be completed in

2013. Once completed, Chinook will operate and maintain this infrastructure until 2043. SNCLavalin and its

partner committed to invest a total of $32.3 million in equit and subordinated debt in Chinook.

In Jul 2010, SNCLavalin, its partner and the McGill Universit Health Centre (MUHC) announced the financial

closure and official signing of a partnership agreement between MUHC and Groupe immobilier sant McGill

(MIHG), composed of SNCLavalin and Innisfree Ltd. Under this 34ear publicprivate partnership, MIHG will

design, build, finance, and maintain MUHCs new Glen Campus, comprised mainl of two hospitals, a cancer

centre and a research institute, located in Montreal, Canada. Also in Jul 2010, MIHG awarded to SNCLavalin an

EPC contract for approximatel $1.6 billion to design and build the facilities. Once completed, MIHG will maintain

the campus for the next 30 ears. SNCLavalin and its partner committed to invest, directl or indirectl, an

amount of $191.8 million in equit and subordinated debt.

The Corporation acquired in 2010 a 36.9% equit interest in Raalseema Expresswa Private Limited (REPL),

an entit that had previousl entered into a contract with the National Highwas Authorit of India to build

and operate the 189kilometre CuddapahKurnool section of National Highwa 18, in the state of Andhra

Pradesh, India. Under this 30ear publicprivate partnership contract, REPL will expand the existing twolane

stretch to four lanes and operate the section of the toll highwa. SNCLavalin committed to invest then an

amount of $36.7 million in equit and subordinated debt.

Dial

During the third quarter of 2010, SNCLavalin disposed of certain Energ Control Sstems (ECS)s technolog

solution assets which help manage and optimie the flow of electricit through power grids. The gain of$22.8 million before taxes (gain of $19.6 million after taxes), was included in Packages activities, as part of

Power.

In October 2010, SNCLavalin had entered into an agreement with a group of financial institutions to sell all of

its 10.07% equit interest in Valener Inc. (TSX:VNR) (Valee) consisting of 3,516,453 common shares of

Valener, on an underwritten block trade basis, for net proceeds of $58.7 million, resulting in a loss after taxes

of $1.3 million. The transaction was closed in November 2010.

In November 2010, SNCLavalin had entered into an agreement with Caisse de dpt et placement du Qubec

to sell all of its 11.1% interest in Trencap Limited Partnership. The transaction generated net proceeds of

$118.2 million and resulted in a gain after taxes of $27.4 million.

Bie Aciii

In 2010, SNCLavalin completed the following business acquisitions, which added approximatel 1,200 people to

its workforce:

· A South African firm, B E Morgan Associates (Proprietar) Limited, specialiing in engineering and

construction of various industrial facilities and that also provides project management and contracting

services primaril to various South African corporations, emploing approximatel 50 people.

· Itansuca Proectos de Ingenieria S.A., an engineering firm in the hdrocarbons and chemicals sector

based in Bogota, Colombia, that emplos approximatel 1,000 people. Since 1989, Itansuca Proectos


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de Ingenieria S.A. has been offering energ consulting, electromechanical installation, design and

supervision services from its Bogota head office and 21 other locations around the countr to clients in

Colombia and in a number of other countries around the world.

· Five engineering firms in France, namel EBI Conseil, Groupe Teco, Pnicaud Architecture

Environnement EURL, ETF Ingnierie Socit dingnieurs conseils and Groupe Setor, that emplo a

total of approximatel 160 people.

· Two engineering firms in Montreal, Canada, namel Nucleonex Inc. and Hdrosult, that emplo a total

of approximatel 20 people.

3. DESCRIPTION OF THE BUSINESS

3.1 GENERAL

SNCLavalin is a leading international engineering and construction compan, and a leader in Operations &

Maintenance (O&M) in Canada. The Corporation is also recognied for its select investments in infrastructure

concessions.

SNCLAVALIN CONSISTS OF:

A network of offices located across Canada and in over 40 other countries with

34,000 EMPLOYEES working in some 100 COUNTRIES,

offering expertise that meets clients' needs

and making selective investments in infrastructure concessions

Engineering and construction

expertise offered as Seice orPackage, to clients in multiple

industries:

Infrastructure & Environment

Mining & Metallurg

Power

Hdrocarbons & Chemicals

Other Industries (including

dagrifood, pharmaceuticals and

dbiotechnolog and sulphuric acid)

O&M activities performed to

efficientl manage clients'facilities and assets, in various

lines of business:

Integrated Real Estate

oSolutions

Industrial

Transportation

Defence & logistics

Selectivel invest in ICI that, in

general, offer potential

complementar engineering and

construction, and/or O&M contract

opportunities, with a fair return for

SNCLavalin shareholders,

such as :

Airports

Bridges

Cultural and public service

pbuildings

Mass transit sstems

Power

Roads

Water

SNCLavalin has ongoing projects in multiple geographic regions and for multiple segments, showing the diversit

of the Corporations operations. The Corporations geographic and industr diversification is one of the ke

factors that allows SNCLavalin to differentiate itself from its competitors.

The Corporation reports its revenues under f caegie f acii, which are as follows:


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· Seice: includes contracts wherein SNCLavalin provides engineering services, feasibilit studies,

planning, detailed design, contractor evaluation and selection, project and construction management,

and commissioning.

Services revenues are derived primaril from costplus reimbursable contracts.

· Package: includes contracts wherein SNCLavalin is responsible not onl for providing one or moreServices activities, but also undertakes the responsibilit for providing materials and equipment, and

usuall also include construction activities.

Packages revenues are derived primaril from fixedprice contracts.

· Oeai ad Maieace (O&M): includes contracts under which the Corporation provides

operations, maintenance and logistics solutions for buildings, power plants, water suppl and

treatment sstems, desalination plants, postal services, broadcasting facilities, telecommunications

infrastructure, highwas, bridges, light rail transit sstems, airports, ships, oil and gas facilities, and

camps for construction operations and the militar.

O&M revenues are derived primaril from cost reimbursable with fixedfee contracts, and from fixed

price contracts.

· Iface Ccei Ieme (ICI): equit investments in infrastructure concessions for

public services, such as airports, bridges, cultural and public service buildings, power, mass transit

sstems, roads and water.

The Cai el ae aaled b egme. The segments regroup related activities within

SNCLavalin cie ih he a maageme efmace i ealaed.

i) Seice ad Package activities relate to engineering and construction operations and are presented in the

wa management performance is evaluated b regrouping its projects within the related industries, and are

as follows:

· Iface & Eime includes a full range of infrastructure projects for the public and private

sectors including airports, buildings, health care, educational and recreational facilities, seaports,

marine and ferr terminals, flood control sstems, urban transit sstems, railwas, roads and bridges,

and water and wastewater treatment and distribution facilities. The Corporation also provides

environmental services worldwide, and has specialied expertise in the power, infrastructure,

hdrocarbons & chemicals, mining, industrial, rural development and climate change sectors.

· Miig & Meallg includes a full range of activities for all mineral and metal recover processes,

including mine infrastructure development, mineral processing, smelting, refining, mine closure and

reclamation, mine and tailings management, as well as production of fertiliers.

· Pe includes projects in hdro, thermal and nuclear power generation, energ from waste, green

energ solutions, and transmission and distribution.

·

Hdcab & Chemical includes projects in the areas of bitumen production, heav oil production,onshore and offshore oil and gas, upgrading and refining, petrochemicals, specialt chemicals, biofuels,

gas processing, liquefied natural gas plants and regasification terminals, coal gasification, carbon

capture, transportation and storage, pipelines, terminals and pump stations.

· Ohe Idie combines projects in several industr sectors, namel agrifood, pharmaceuticals and

biotechnolog, sulphuric acid as well as projects related to other industrial facilities not alread

identified as part of an other preceding industr segments.

ii) O&M activities as described above.

iii) ICI as described above.


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COMPETITIVE CONDITIONS

SNCLavalin derives its competitive strength from its project management expertise, its reputation for qualit

and deliver, its abilit to work globall, its highl skilled and experienced technical personnel, its commitment

to health and safet matters and to a sustainable environment, the scope of its geographical presence and its

abilit to execute projects of varing sies calling for a wide range of services and technologies.

The Corporation operates in a highl competitive environment and has numerous competitors in all of its

market segments. The competitive landscape varies b industr, geographic, and project tpe. Companies that

compete within itsengineering and construction segment are principall: AECOM, AMEC plc, The Bechtel

Group Inc., CH2M Hill, Fluor Corporation, Foster Wheeler, Hatch Ltd, Jacobs Engineering Group Inc., Technip,

Samsung Engineering, URS and Worle Parsons Ltd. Companies that compete within our O&M segment are

principall: Aker Solutions, Atco Group, BLJC, Carillion, CBRE Group Inc., Jones Lang LaSalle, PTI Group Inc.,

Serco, Transfield Services, Veolia. Companies that compete with our ICI segment are principall: Acciona S.A.,

Balfour Beatt Capital, Cintra (Ferrovial), Iridium (ACS), Vinci Concessions.

SNCLavalin has clients worldwide, man of them are repeat clients. In an given ear, a single client ma

represent a material portion of the Corporations consolidated revenues due to the sie of a particular project

and the progress accomplished on such project.

Clients of engineeringconstruction firms in Canada range from small to large industrial companies and Crown

corporations to municipal, provincial and federal governments. Most international clients of Canadian

engineeringconstruction firms are in developing countries or are large industrial companies.

Cah Maageme Plic

SNCLavalins cash management polic requires that cash balances be invested in highl secure and highl

liquid instruments that provide ields comparable to those available on the market for highgrade investment

instruments. The Corporation invests its cash balances, primaril, in mone market instruments and bonds of

highcredit qualit.

Ogaiaial Sce

SNCLavalin has a network of marketing and operating offices across Canada and in over 40 other countries.

At an given time, its emploees are working in approximatel 100 countries carring out projects, pursuing

business opportunities and marketing its products and services. To gain better access to markets outside

Canada and to facilitate the financing of international projects, SNCLavalin ma form alliances, either with

firms possessing expertise that is complementar to SNCLavalins existing capabilities, or with leading local

firms in such markets.

3.2 REVENUE BACKLOG

A discussion of the revenue backlog of SNCLavalin is presented under the heading Managements Discussion

and Analsis Revenue Backlog, of the Corporations most recent Financial Report which discussion isincorporated herein b reference. The Corporations most recent Financial Report is available on SEDAR at

.eda.cm or on the Corporations website at .claali.cm under the Investors section.

3.3 RISK FACTORS

A discussion of the risks and uncertainties to which SNCLavalin is subject is presented under the heading

Managements Discussion and Analsis Risks and Uncertainties, of the Corporations most recent Financial

Report which discussion is incorporated herein b reference. The Corporations most recent Financial Report is

available on SEDAR at .eda.cm or on the Corporations website at .claali.cm under the

Investors section.

http://www.sedar.com/http://www.sedar.com/http://www.snclavalin.com/http://www.snclavalin.com/http://www.sedar.com/http://www.sedar.com/http://www.snclavalin.com/http://www.snclavalin.com/http://www.snclavalin.com/http://www.sedar.com/http://www.snclavalin.com/http://www.sedar.com/http://www.snclavalin.com/http://www.sedar.com/http://www.snclavalin.com/http://www.sedar.com/


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3.4 HUMAN RESOURCES

The table below shows the approximate number of emploees in the SNCLavalin group of companies:

Nmbe f emlee a a

Decembe 31

2012 2011 2010

Tal 33,900 28,100 23,900

The number of emploees varies depending on the number and nature of ongoing projects.

3.5 WE CARE VALUE STATEMENT

SNCLavalin has a WE CARE value statement which reiterates the Corporations commitment to the well

being of its emploees (see 3.5.1), the health and safet of people working on project sites and in offices

worldwide (see 3.5.2), the communities in which its emploees live and work (see 3.5.3), a sustainable

environment (see 3.5.4), and qualit (see 3.5.5). The WE CARE value statement reinforces values that have

formed the cornerstone of SNCLavalins culture for more than 100 ears. WE CARE has become the

framework for ongoing corporate and individual division or business unit initiatives and programs in supportof each of its core values. The Office of the President ensures continuit in our corporate programs and the

development of new ones to maintain a high level of awareness throughout the Corporation of the

importance of living these core values.

3.5.1 WellBeig f Emlee

SNCLavalin rapid growth, particularl over the last decade, has heightened the need to build a longer term,

companwide strateg to manage its human capital. In the last ear, Human Resources has deploed man

initiatives throughout the organiation aimed at creating a health and fulfilling work environment, including

the Total Rewards Stud which collected feedback on compensation, benefits, work environment and growth

opportunities and identified areas where we need to close the gaps; the Emploee Engagement Surve thatasked emploees to provide comments on how well the organiation is meeting their needs and expectations;

the SNCLavalin Academ which focuses on companwide learning needs; the introduction of a revised Code

of Ethics and Business Conduct and the creation of an Ethics and Compliance Hotline to report Code violations

via an independent third part; and the implementation of a pa for performance culture that ensures a link

exists between the performance of an emploee and the compensation she or he receives. Initiatives such as

these contribute not onl to the wellbeing of current emploees, but also pla a role in attracting and

retaining a skilled and engaged workforce.

3.5.2 Healh ad Safe

SNCLavalins value statement commits the Corporation to caring about the health and safet and securit

of people who work under our care, and of the people our projects serve.

SNCLavalin has a Global Health and Safet Polic for all work sites. The Corporation has developed strategies

and tools to ensure that this Polic is implemented in all its activities. The strategies are based on the

principles of visible safet leadership at all levels and individual competence in identifing and managing

haards in the accomplishment of all work. From these basic strategies a series of tools have been developed,

which include the implementation of global health and safet management sstem, the use of comprehensive

and active risk registers, use b individual emploees of a personal risk assessment tool called the StepBack

Program, and a positive incentive program to reward risk competent behaviour.

SNCLavalin also has a Global Securit Polic which applies to all offices, project sites and ongoing operations.

This polic is comprehensive, includes specific and measurable compan objectives, sets clear expectations


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and lines of accountabilit for each emploee, and reinforces that the Corporation: (i) is committed to the

highest standards of securit, (ii) sets annual specific and measurable securit performance objectives and (iii)

looks for opportunities to reduce securit risks to which emploees and contractors are exposed.

The Office of the President receives monthl reports including statistics relating to health and safet

performance throughout the Corporation. The implementation of health and safet policies as well as SNC

Lavalins health and safet performance is monitored and reviewed b the Health & Safet, Securit andEnvironment Committee of the Board of Directors which meets approximatel 4 times per ear.

3.5.3 The Cmmiie i Which We Lie ad Wk

The Corporation supports, encourages and acknowledges the increasing number of local communit initiatives

undertaken b divisions, business units, project teams and individual emploees in their communities

worldwide because it believes working in the communit is the right thing to do and because it demonstrates

the Corporations active commitment as a responsible global citien.

3.5.4 Eime

The Corporation has an Environmental Polic which commits SNCLavalin and its emploees to integrate

environmental considerations into all corporate activities worldwide, to compl with all applicableenvironmental laws, regulations and standards, and to implement pollution prevention procedures.

SNCLavalin is subject to Canadian federal, provincial and municipal laws and regulations relating to the

environment. Projects that the Corporation implements outside Canada are subject to local environmental

legislation. SNCLavalin ensures that it complies in all material respects with such laws and regulations. The

Corporations environmental professionals provide support to its business units and conduct environmental

studies (such as environmental impact assessments) that ma be required in the various jurisdictions in which

the Corporation operates.

On construction sites which it manages, the Corporation implements construction site environmental

management plans in order to ensure that its construction management activities compl with the

requirements of applicable legislation, as well as the requirements of its own environmental polic.Construction sites managed b the Corporation provide reports on their environmental performance in

accordance with standard environmental management indicators.

This Polic and its application are monitored and reviewed b the Health & Safet, Securit and Environment

Committee of the Board of Directors which meets approximatel 4 times per ear.

3.5.5 Qali

The final WE CARE value concerns the qualit of our work. SNCLavalin has long prided itself regarding the

qualit of its work and divisions of the Corporation, between them, hold over 40 ISO qualit management

sstem certificates. The Corporate Qualit Polic provides guidance to all business units in their

implementation of the WE CARE value statement on qualit.

4. DIVIDENDS

SNCLavalin aims to declare and pa cash dividends on a quarterl basis. SNCLavalins Board of Directors

considers several factors when reviewing dividend paments, including present and future: (i) earnings,

(ii) cash flows, and (iii) capital requirements. There can be no assurance as to the amount or timing of such

dividends in the future.


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In the past 3 fiscal ears, SNCLavalin has declared the following quarterl dividends per common share:

Q1

($)

Q2

($)

Q3

($)

Q4

($)

Aal

($)

2012 0.22 0.22 0.22 0.23 0.89

2011 0.21 0.21 0.21 0.22 0.852010 0.17 0.17 0.17 0.21 0.72

5. CAPITAL STRUCTURE

Geeal Decii

The Corporations authoried share capital consists of an unlimited number of common shares, first preferred

shares and second preferred shares. Onl common shares are currentl outstanding. The following

summaries certain provisions relating to the Corporations common shares, first preferred shares and second

preferred shares. This summar is qualified in its entiret b the actual rights, privileges, restrictions and

conditions attaching to such shares.

Cmm Shae

Dividend: the holders of the Corporations common shares are entitled to receive dividends as and when

declared b the Board of Directors.

Voting rights: the holders of the Corporations common shares are entitled to notice of, to attend and to one

vote per share at all meetings of the Corporations shareholders.

Rights upon liquidation, winding up or dissolution: the holders of the Corporations common shares will be

entitled to receive the remaining propert of the Corporation upon liquidation, dissolution or windingup.

Fi Pefeed Shae

Issuable in series: the Corporations Board of Directors is allowed to fix, before issuance the designation,

rights, privileges, restrictions and conditions attached thereto.

Dividend: Priorit over all other classes of shares.

Voting rights: Not entitled to vote separatel as a class except as provided b law.

Rights upon liquidation, winding up or dissolution: Priorit over all other classes of shares.

Seie A:

Dividend:

Priorit over all other classes of shares.

Cumulative for an amount equal to 77% of the prime rate set b the National Bank.

Paable quarterl.

No redemption or repurchase of other shares is permitted until the cumulative dividend is paid in full.

Voting rights:

Not entitled to vote separatel as a class except as provided b law.


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Rights upon liquidation, winding up or dissolution:

Priorit over all other classes of shares.

Right to receive amount equal to the amount paid on the shares and all accrued unpaid dividends.

Redemption Right:

At the option of the Corporation for an amount paid on the shares and all accrued unpaid dividends.

Secd Pefeed Shae

Issuable in series: the Corporations Board of Directors is allowed to fix, before issuance the designation,

rights, privileges, restrictions and conditions attached thereto.

Dividend: Priorit over all other classes of shares except First Preferred Shares.

Voting rights: Not entitled to vote separatel as a class except as provided b law.

Rights upon liquidation, winding up or dissolution: Priorit over all other classes of shares except First

Preferred Shares.

Cedi Raig

The following table shows the ratings for the Corporations $350 million, 6.19% debentures due in Jul 2019

Standard & Poors Ratings Services

(S&P)

DBRS

$350 million,

6.19% debentures

due in Jul 2019

BBB+

Negative Outlook

BBB (high)

Stable Trend

On November 30, 2011, S&P rated the Corporations debentures BBB+ with a stable outlook. On April 20,

2012, S&P affirmed the Corporations rating at BBB+ and revised the outlook to negative from stable. The

negative outlook reflects S&Ps concerns regarding a potential impact on the Corporations competitive

position following its disclosure of the results of an independent review in the Corporations 2011 MD&A.

Standard & Poors rating outlook assesses the potential direction of a longterm credit rating over the

intermediate term (tpicall six months to two ears). In determining a rating outlook, consideration is given

to an changes in the economic and/or fundamental business conditions. A negative outlook means that a

credit rating ma be lowered. An outlook is not necessaril a precursor of a rating change or future

CreditWatch action.

On September 16, 2011, DBRS confirmed the Corporations debenture rating at BBB (high) and changed the

trend to Positive from Stable. On Februar 28, 2012, following the Corporations update on the announcement

of its revised guidance on its 2011 financial results and disclosure of the results of an independent review,

DBRS placed SNCLavalins debentures rating at BBB (high) Under Review with Developing Implications. On

March 27, 2012, DBRS confirmed the Corporations Debenture rating at BBB (high) and changed the trend to

Stable from Positive. With this confirmation, the rating was removed from Under Review with Developing

Implications. On September 14, 2012, DBRS confirmed the Corporations Debenture rating at BBB (high) with

Stable trend.

Credit ratings established b S&P and DBRS are based on quantitative and qualitative considerations relevant

to the Corporation. The credit ratings are intended to indicate the risk that the Corporation will not satisf its


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obligations on a timel basis and disregard certain factors such as market risk or price risk. These factors

should be considered b investors as risk factors in their process of investment decision making. Such ratings

do not constitute a recommendation to purchase, hold or sell the securities and ma be changed or

withdrawn at an time b the rating agencies.

The S&P and DBRS ratings for borrowing var between AAA and D. The BBB+ and BBB (high) ratings granted

b S&P and DBRS, respectivel, testif to the existence of adequate protection mechanisms. However, anunfavourable economic situation or changing circumstances could affect the Corporations abilit to meet its

financial commitments.

Fee Paid Cedi Raig Ogaiai

The fees described in the table below were paid b the Corporation to DBRS and S&P in order to obtain a

credit rating for its corporate debentures.

Fee Paid b he Cai Cedi Raig Ogaiai

f Cae Cedi Raig2012 2011

DBRS $54,000 $52,000

S&P $42,500 $45,000

TOTAL: $96,500 $97,000

6. MARKET FOR SECURITIES

Make

The common shares of the Corporation are listed for trading on the Toronto Stock Exchange (TSX) under thesmbol SNC. The Corporations common shares are included in the S&P/TSX Composite Index as well as the

S&P/TSX Industrials Index, S&P/TSX 60 Index and the S&P/TSX Canadian Dividend Aristocrats Index.

Tadig Pice ad Vlme

The following table sets out the trading prices and volumes of the Corporations common shares on the TSX

and on alternative Canadian trading sstems for the periods indicated.

2012 Vlme (i 000) High* L* Cle

Jaa 8,579 55.95 51.27 51.63

Feba 31,631 54.00 36.56 37.40Mach 38,418 42.74 37.48 39.93

Ail 24,200 40.92 34.92 37.14

Ma 20,048 40.22 35.85 38.14

Je 14,199 41.82 36.52 38.14

Jl 7,298 40.45 37.81 39.56

Ag 18,237 40.45 35.00 35.00

Seembe 13,422 39.47 34.36 37.95

Ocbe 8,885 40.40 36.88 40.23

Nembe 20,595 43.80 38.61 39.40

Decembe 17,175 41.59 36.79 40.32


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* Intrada highs and lows during each month


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7. DIRECTORS AND OFFICERS

The following table lists the Directors of the Corporation, as at March 8, 2013, their place of residence, and

their respective principal occupations during the 5 preceding ears:

Name ad Place f Reidece Picial Occai Dig he 5

Pecedig Yea Diec Sice

Ian A. Bourne, F.ICD, ICD.D.(1), (3), (5), (6)

Alberta (Canada)

Compan Director and

ViceChairman of the Board

of the Corporation; Former ViceChairman

of the Board and Interim CEO of the

Corporation

2009

Robert G. Card(7)

Quebec (Canada)

President and Chief Executive Officer

of the Corporation; Former Director and

President, Energ, Water & Facilities

Division, CH2M Hill Companies, Ltd.

(CH2M Hill) (an engineering and

services firm);

Former President, Energ & Water

Division, CH2M Hill;

Former President, Facilities &

Infrastructure Division, CH2M Hill;

Former President, Government,

Environment & Nuclear Division, CH2M

Hill; Former Chairman, CH2M Hill

International; Former Deput Program

Director, CLM Deliver Partner (a CH2M

Hill lead joint venture).

2012

David Goldman(1), (3), (4), (5), (6)

Ontario (Canada)Compan Director and President, DaveGoldman Advisors Ltd. (a general

consultanc business)

2002

Patricia A. Hammick, Ph.D.(1), (2)

Virginia (United States of America)

Compan Director 2007

Pierre H. Lessard(2)

Quebec (Canada)

Compan Director and Executive

Chairman, Metro Inc. (food retailer and

wholesale distributor of food and

pharmaceutical products)

1998

Edthe (Dee) A. Marcoux(1), (3), (4)

British Columbia (Canada)

Compan Director 1998

Professor Lorna R. Marsden, C.M., Ph.D.(2), (4)

Ontario (Canada)

Compan Director and

Professor and President Emerita,

York Universit

2006

Claude Mongeau(1), (2)

Quebec (Canada)

President and Chief Executive Officer

Canadian National Railwa Compan

(CN) (North American railroad);

Former Executive VicePresident, CN;

Former Executive VicePresident and Chief

2003


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Name ad Place f Reidece Picial Occai Dig he 5

Pecedig Yea Diec Sice

Financial Officer, CN

Gwn Morgan, C.M.(3), (6)


Compan Director and

Chairman of the Board

of the Corporation

2005

Michael D. Parker, CBE(4), (5)

London (United Kingdom)

Compan Director;

Former Group Chief Executive,

British Nuclear Fuels PLC (manufacturer

and transporter of nuclear products)

2010

Chakib Sbiti(4), (5), (8)

Dubai (United Arab Emirates)

Executive Advisor to the

Chief Executive Officer, Schlumberger

(international oilfield services)

2012

Eric D. Siegel, ICD.D.(4), (5)

Ontario (Canada)

Compan Director and

Ottawa Chapter Executive,

Institute of Corporate Directors (notfor

profit association representing Canadian

directors and boards);

Former President and Chief Executive

Officer, Export Development Canada

(Canadas export credit agenc)

2012

Lawrence N. Stevenson(2), (3), (6)

Ontario (Canada)

Compan Director and Managing Director,

Callisto Capital LP (private equit firm)

1999

(1) Member of the Audit Committee

(2) Member of the Human Resources Committee

(3) Member of the Governance Committee

(4) Member of the Health & Safet, Securit and Environment Committee(5) Member of the Project Review Committee

(6) Member of the adhoc Special Transitional Committee created on March 23, 2012 and terminated on October 1, 2012

(7) On October 1, 2012, Mr. Robert G. Card became President and Chief Executive Officer and a Director of the Corporation

(8) On November 2, 2012, Mr. Chakib Sbiti became a Director of the Corporation, as well as a member of the Health & Safet,

Securit and Environment Committee and the Project Review Committee

The Directors of the Corporation are elected b the shareholders at the Annual Meeting of the Corporation.

The hold office until their term expires at the following Annual Meeting, subject to reelection, retirement,

resignation or vacanc caused b death, removal or other cause.

To the knowledge of the Corporation, in the last 10 ears, none of the abovenamed nominees is or has been a

director or officer of an compan that, while that person was acting in that capacit (i) was the subject of a

cease trade order or similar order, or an order that denied the relevant compan access to an exemptions

under securities legislation, for a period of more than 30 consecutive das or (ii) became bankrupt, made a

proposal under an legislation relating to bankruptc or insolvenc, or was subject to or instituted an

proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee

appointed to hold its assets, except for:

i) Mr. Claude Mongeau, a Director of the Corporation, who became a director of Nortel Networks

Corporation (NNC) and Nortel Networks Limited (NNL) on June 29, 2006 and resigned at the end of

August 2009. On Januar 14, 2009, NNC, NNL and certain other Canadian subsidiaries initiated creditor

protection proceedings under the Companies Creditors Arrangement Act (CCAA) in Canada. Certain

U.S. subsidiaries filed voluntar petitions in the United States under Chapter 11 of the U.S. Bankruptc

Code, and certain Europe, Middle East and Africa (EMEA) subsidiaries made consequential filings in


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Europe and the Middle East. These proceedings are ongoing. Mr. Mongeau resigned as a director of

NNC and NNL effective end of August 2009.

ii) Ms. Edthe (Dee) A. Marcoux, a Director of the Corporation, who was acting as a director of Southern

Pacific Petroleum NL (SPP) when SPPs securities were suspended from quotation on the Australian

Stock Exchange prior to the commencement of trading on November 25, 2003 for a period of more

than 30 consecutive das, and in respect of which receivers were appointed on December 2, 2003.

SPPs securities are not currentl being traded. Ms. Marcoux resigned as a director of SPP with effect

from 12 noon on December 5, 2003. Ms. Marcoux was also a Director and member of the Audit

Committee of OPTI Canada Inc. (OPTI). On Jul 13, 2011, OPTI commenced proceedings for creditor

protection under the CCAA. The TSX delisted OPTIs common shares on August 26, 2011. The TSX

approved the listing of OPTIs common shares on the TSXV which commenced trading on August 29,

2011. OPTIs common shares were subsequentl delisted from the TSXV at the close of business on

November 29, 2011, following the closing of OPTIs acquisition b CNOOC Luxembourg S..r.l., an

indirect whollowned subsidiar of CNOOC Limited (the Aciii). Pursuant to the Acquisition,

indirect whollowned subsidiaries of CNOOC Limited acquired over OPTIs second lien notes and all of

the outstanding shares of OPTI. The Acquisition was effected b wa of a plan of arrangement through

OPTIs current proceedings under the CCAA and the CBCA. Ms. Marcoux resigned as a director of OPTI

Canada Inc. on November 28, 2011.

ii) Ms. Patricia A. Hammick, a Director of the Corporation, who became a director of Dneg Inc.

(Deg) in April, 2003 and ceased to be a director of Dneg on June 15, 2011. On December 1,

2011, Dneg and its direct subsidiar Dneg Holdings LLC (Deg Hldig) filed, as coplan

proponents, a plan of reorganiation in respect of Dneg Holdings. On April 3, 2012, Dneg

announced that it had reached an agreement with ke Dneg Holdings creditors contemplating the

resolution of all disputes with such creditors. On Jul 6, 2012, Dneg filed a voluntar petition for relief

pursuant to the U.S. Bankruptc Code. On September 5, 2012, Dneg announced that its Chapter 11

Plan of Reorganiation under the U.S. Bankruptc Code was confirmed and, on October 1, 2012,

announced that it had consummated its reorganiation under Chapter 11 of the U.S. Bankruptc Code

and had exited bankruptc. Ms. Hammick ceased to be a director of Dneg on June 15, 2011. Ms.

Hammick has never been a director of Dneg Holdings.

Furthermore, to the knowledge of the Corporation, in the last 10 ears, no Director or officer of the

Corporation, or a shareholder holding a sufficient number of securities of the Corporation to materiall affect

the control of the Corporation, has become bankrupt, made a proposal under an legislation relating to

bankruptc or insolvenc, or became subject to or instituted an proceedings, arrangement or compromise

with creditors, or had a receiver, receiver manager or trustee appointed to hold his/her assets.

The Board of Directors of the Corporation currentl has 5 standing Board Committees (the Audit Committee;

the Governance Committee; the Health & Safet, Securit and Environment Committee; the Human Resources

Committee; and the Project Review Committee). The Board of Directors does not have an executive

committee. As at March 8, 2013, membership of the Board Committees was as follows:

Adi Cmmiee Geace Cmmiee

I. A. Bourne (Chair) I.A. BourneD. Goldman D. Goldman

P.A. Hammick E.A. Marcoux

E.A. Marcoux G. Morgan (Chair)

C. Mongeau L.N. Stevenson

Healh & Safe, Seci ad Eime Cmmiee Hma Rece Cmmiee

D. Goldman P.A. Hammick

E.A. Marcoux (Chair) P.H. Lessard

L.R. Marsden L.R. Marsden

M.D. Parker C. Mongeau


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C. Sbiti L.N. Stevenson (Chair)

E. D. Siegel

Pjec Reie Cmmiee

I.A. Bourne

D. Goldman (Chair)

M.D. ParkerC. Sbiti

E.D. Siegel

The following table lists the executive officers of the Corporation who are not also Directors of the

Corporation, as at March 8, 2013, their place of residence and their respective principal occupations during

the 5 preceding ears:

Name ad Place f Reidece Picial Occai Dig he 5 Pecedig Yea

Jean Beaudoin

Quebec (Canada)

Executive VicePresident, Integrated Management Sstems;

Executive VicePresident, Chemicals and Petroleum

Neil Bruce

South Oxfordshire (United Kingdom)

President, Resources & Environment;

Executive Director and Chief Operating Officer, AMEC

(engineering consultanc and project management services);

Executive Director and Chief Operating Officer,

Natural Resources and Power & Process, AMEC;

Executive Director and Chief Operating Officer,

Natural Resources division, AMEC;

Chief Operating Officer, Natural Resources division, AMEC

Jim Burke


Executive VicePresident, Airports, Mass Transit, Railwas, Ports

and Marine;

Executive VicePresident, Airports, Mass Transit, Railwas, Ports

and Marine and Environment;

Senior VicePresident and General Manager,

Transportation and General Engineering

Darleen Caron

Quebec (Canada)

Executive VicePresident, Global Human Resources;

VicePresident, Human Capital Planning and Development, Dow

Chemical (manufacturer of chemical products);

Head of the Geographic Organiation, Dow Chemical

Charles Chebl

Quebec (Canada)

Executive VicePresident, Infrastructure and Construction;

Senior VicePresident, Buildings Group Quebec, Infrastructure

& Construction;

Senior VicePresident and General Manager, Construction

Management and ConstructionCanada


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Name ad Place f Reidece Picial Occai Dig he 5 Pecedig Yea

Dale Clarke

Ontario (Canada)

Executive VicePresident, Mining & Metallurg;

Senior VicePresident, Global Mining and Metallurg

Rjean Goulet

Quebec (Canada)

Executive VicePresident and General Counsel;

Senior VicePresident and General Counsel;

VicePresident, Law

Christian Jacqui

IvrsurSeine (France)

Executive VicePresident, Global Operations;

Executive VicePresident, Europe;

Deput Chief Executive Officer, SchilienneSidec SA

(independent energ producer);

Executive VicePresident, Areva NP Plants sector (nuclear);

Chief Operating Officer, SAUR Group (engineering services)

Gilles Larame Executive VicePresident, Infrastructure, Concessions and

Quebec (Canada) Investments, and Chief Financial Officer;

Executive VicePresident and Chief Financial Officer

Michael Novak

Quebec (Canada)

Executive VicePresident, Global Government, Aboriginal and

Economic Affairs;

Executive VicePresident, International and Aboriginal Affairs;

Executive VicePresident, Corporate Risk Management, Global

Information Technologies, Global Procurement, Health, Safet

and Environment, and SNCLavalin International;

Executive VicePresident, Global Information Technologies,

Global Procurement, International, Health, Safet and

Environment, Risk Evaluation Committee and Strategic

Planning

Charles Rate

Ontario (Canada)

Executive VicePresident, Operations and Maintenance;

Executive VicePresident, Operations and Maintenance,Logistics and InService Support

Ric Sorbo

Alberta (Canada)

Acting Executive VicePresident, Hdrocarbons and Chemicals;

Senior VicePresident and General Manager, Hdrocarbons

and Chemicals Canada;

Senior VicePresident, Energ and Chemicals Business Group,

CH2M Hill;

Senior Vice President, Petrochemicals and Ethlene, Shaw

Energ and Chemicals (energ and chemicals);

VicePresident, Project Management, KBR, Inc. (engineering,

construction and services compan)

Scott ThonAlberta (Canada)

Acting Executive VicePresident, Power;President and Chief Executive Officer, Altalink (regulated

electricit transmission compan)

As at December 31, 2012, the Directors and the above executive officers of the Corporation, as a group, held,

either directl or indirectl, or exercised control over 803,755 common shares, namel approximatel 0.54% of

the common shares of the Corporation.


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8. LEGAL PROCEEDINGS

Cla Aci Lai

On March 1, 2012, a Motion to Authorie the Beginning of a Class Action and to Obtain the Status of

Representative (the Quebec Motion) was filed with the Quebec Superior Court, on behalf of persons who

acquired SNCLavalin securities from and including March 13, 2009 through and including Februar 28, 2012,whether in a primar market offering or in the secondar market. The Quebec Motion raises both statutor

and negligent misrepresentation claims.

On Ma 9, 2012, two proposed class actions were commenced in the Ontario Superior Court on behalf of all

persons who acquired SNCLavalin securities during different time periods. These two actions were

consolidated into a single action (the Ontario Action) on June 29, 2012. The Ontario Action seeks damages

on behalf of all persons who acquired securities of SNCLavalin between November 6, 2009 and Februar 27,

2012 (the Class Period). The Ontario Action raises, among other things, both statutor and common law

misrepresentation claims.

The Quebec Motion and the Ontario Action (collectivel, the Actions) allege that certain documents filed b

SNCLavalin contained misrepresentations concerning, among other things, SNCLavalins corporate

governance practices, adequac of controls and procedures, reported net income for the ear ended

December 31, 2010, and adherence to SNCLavalins Code of Ethics and Business Conduct.

The Actions each seek damages based on the decline in market value of the securities purchased b proposed

class members when SNCLavalin issued a press release dated Februar 28, 2012, as well as other damages

and costs. The Ontario Action seeks additional damages based on a further drop in share price on June 25,

2012.

On September 19, 2012, an Ontario judge agreed to the discontinuance of the plaintiffs claims other than the

statutor misrepresentation claims under securities legislation in accordance with an agreement with the

plaintiffs. The judge granted the plaintiffs leave to proceed with those statutor claims and has certified a class

action covering shareholders who bought SNCLavalin shares during the Class Period except for Quebec

residents. On Januar 24, 2013, a judge of the Quebec Superior Court rendered a similar judgement covering

Quebec residents.

Due to the inherent uncertainties of litigation, it is not possible to predict the final outcome of these lawsuits

or determine the amount of an potential losses, if an, and SNCLavalin ma, in the future, be subject to

further class action lawsuit or other litigation. While SNCLavalin has directors and officers liabilit insurance

insuring individuals against liabilit for acts or omissions in their capacities as directors and officers, the

Corporation does not maintain an other insurance in connection with the Actions. The amount of coverage

under the directors and officers polic is limited and such coverage ma be an insignificant portion of an

amounts the Corporation is required or determines to pa in connection with the Actions. In the event the

Corporation is required or determines to pa amounts in connection with these lawsuits or other litigation,

such amounts could be significant and ma have a material adverse impact on SNCLavalins liquidit and

financial results.

Ohe

The Corporation is a part to other claims and litigation arising in the normal course of operations. The

Corporation does not expect the resolution of these matters to have a materiall adverse effect on its financial

position or results of operations.


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9. AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN AGREEMENT

On March 6, 2008, the Board of Directors of the Corporation approved an Amended and Restated Shareholder

Rights Plan Agreement, which was subsequentl ratified b the Corporations shareholders on Ma 1, 2008

and filed under the Corporations SEDAR profile on Ma 14, 2008. The Corporation subsequentl entered intoan Amended and Restated Shareholder Rights Plan Agreement dated as of March 4, 2011, with

Computershare Investor Services Inc. as rights agent, which was subsequentl ratified b the Corporations

shareholders on Ma 5, 2011 and filed under the Corporations SEDAR profile on Ma 6, 2011.

10. TRANSFER AGENT AND REGISTRAR

Computershare Investor Services Inc. is the Corporations transfer agent and registrar for the Corporations

common shares, with principal offices in the cities of Montreal (Quebec), Toronto (Ontario), and Vancouver

(British Columbia).

11. EXPERTS

Deloitte LLP is the auditor of the Corporation and is independent within the meaning of the Rules of

Professional Conduct of the .

12. AUDIT COMMITTEE

Madae f he Adi Cmmiee

The mandate of the Audit Committee of SNCLavalin is attached as Schedule A to this Annual Information

Form.

Cmii f Adi Cmmiee

The Audit Committee of the Corporation consists of Mr. Ian A. Bourne (Chairman), Mr. David Goldman, Ms.

Patricia A. Hammick, Ms. Edthe A. Marcoux and Mr. Claude Mongeau. Each member of the Audit Committee

is independent and none receives, directl or indirectl, an compensation from the Corporation other than

for service as a member of the Board of Directors and its Committees. All members of the Audit Committee

are financiall literate, as this phrase is defined under National Instrument 52110 (Audit Committees) of the

Canadian Securities Administrators (the CSA). In considering the criteria for determining financial literac,

the Board considers the abilit of the director to read and understand a set of financial statements that

present a breadth and level of complexit of accounting issues that are generall comparable to the breadth

and complexit of the issues that can reasonabl be expected to be raised b the Corporations financial

statements.

Relea Pfeial Qalificai ad Eeiece f Adi Cmmiee Membe

Each of the members of the Corporations Audit Committee has professional qualifications, business

experience, or both, that are relevant to the performance of his/her responsibilities as a member of the Audit

Committee (for additional disclosure regarding the qualifications and experience of these Directors, see

section 3.1 Directors Proposed for Election and Schedule F Board Committee Reports Report of the Audit

Committee of the 2012 management prox circular of the Corporation the Maageme P Cicla).

Mr. Bourne with his man ears as Executive VicePresident and CFO of TransAlta Corporation and as

President and director of TransAlta Power LP and prior to that as CFO of Canada Post Corporation and General

Electric Canada, has extensive financial expertise. Furthermore, Mr. Bourne is Chairman of the Audit


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Committee of Wajax Corporation and the Canada Pension Plan Investment Board and is a member of the

Audit Committee of Ballard Power Sstems Inc. and Canadian Oil Sands Limited.

Mr. Goldman is or has been a member of the board and audit committee of several issuers listed on NASDAQ

or on the TSX and has experience such as that gained when he was Executive VicePresident and Chief

Operating Officer of Noranda Inc. (now known as Xstrata).

Ms. Hammick is a director and member of the Finance Committee of Consol Energ Inc. and was until recentl

lead director and ex officio member of the Audit & Compliance Committee of Dneg Inc. She also has

financial expertise acquired through her experience as part of the management team at Columbia Energ

Group.

Ms. Marcoux has extensive experience in financial matters from her man ears as a director for a number of

large public issuers such as the National Bank of Canada, Sherritt International Corporation and Placer Dome

Inc. She is also a former member of the Audit Committee of OPTI Canada Inc.

Mr. Mongeau is presentl the Chief Executive Officer of Canadian National Railwa Compan, was that

compans Executive VicePresident and Chief Financial Officer from 2000 until his appointment as Chief

Executive Officer on Januar 1, 2010 and was named Canadas CFO of the Year in 2005.

PeAal Plicie ad Pcede

The Audit Committee has considered whether the provision of services other than audit services is compatible

with maintaining the auditors independence. The Audit Committee has adopted a polic that prohibits the

Corporation from engaging auditors for prohibited categories of nonaudit services and requires pre

approval, b the Audit Committee, of audit services and other services within permissible categories of non

audit services, as set out in the terms of the Audit Committees mandate (see Schedule A to this Annual

Information Form).

Adi Fee

The aggregate fees paid, including the Corporations prorata share of the fees paid b its joint ventures andother investees, for professional services rendered b Deloitte LLP and its affiliates, the Corporations auditor,

for the ear ended December 31, 2012 and the ear ended December 31, 2011, are presented below:

Yea Eded Decembe 31, 2012 Yea Eded Decembe 31, 2011

Adi fee(1)

$4,351,900 $3,197,100

Adielaed fee(2)

$1,899,000 $983,500

Ta fee(3)

$1,082,300 $1,200,900

Ohe fee(4)

$2,012,700 $169,000

Tal(5)

$9,345,900 $5,550,500

(1) Audit fees include fees for professional services rendered for the audit of the Corporations annual

financial statements and the review of the Corporations quarterl reports. The also comprise fees for

audit services provided in connection with other statutor and regulator filings, such as the audit of

the financial statements of the Corporations subsidiaries, as well as services that generall onl the

Corporations auditor can provide, such as comfort letters, consents and assistance with and review of

documents filed with the securities commissions.

The increase of $1,154,800 from $3,197,100 in 2011 to $4,351,900 in 2012 is mainl due to additional

audit procedures relating to the Independent Review facts discussed in the Corporations 2012


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Managements Discussion and Analsis (section 14 Risks and Uncertainties) and to higher audit costs

relating to various subsidiaries.

(2) Auditrelated fees include fees for assurance services that are reasonabl related to the audit or review

of the financial statements and are not reported under Audit fees, including special attest services

not required b statute or regulation, reporting on the effectiveness of internal controls as required b

contract or for business reasons, accounting consultations in connection with various transactions, and

the audit of the Corporations various pension plans.

The increase of $915,500 from $983,500 in 2011 to $1,899,000 in 2012 is mainl due to a mandate to

audit the effectiveness of the Corporations internal controls over financial reporting (ICFR) based on

criteria established in the Internal Control Integrated Framework issued b the Committee of

Sponsoring Organiations of the Treadwa Commission (the COSO Framework).

(3) Tax fees comprise fees for income, consumption and other tax compliance, advice and planning

services relating to domestic and international taxation, review of tax returns and preparation of

expatriate emploee tax returns.

(4) Other fees include fees for services other than those described under Audit fees, Auditrelated fees

and Tax fees. The increase of $1,843,700 from $169,000 in 2011 to $2,012,700 in 2012 is mainl due

to forensic effort relating to investigations on certain projects.

(5) The aggregate fees paid to Deloitte LLP, irrespective of the Corporations proportionate interests in its

joint ventures and other investees, totaled $10,523,000 in 2012 and $6,544,400 in 2011.

13. CAUTION REGARDING FORWARDLOOKING STATEMENTS

Statements made in this AIF that describe the Corporations or managements budgets, estimates, expectations,

forecasts, objectives, predictions, projections of the future or strategies ma be forwardlooking statements,

which can be identified b the use of the conditional or forwardlooking terminolog such as aims,

anticipates, assumes, believes, estimates, expects, goal, intends, ma, plans, projects,

should, will, or the negative thereof or other variations thereon. Forwardlooking statements also include an

other statements that do not refer to historical facts. All such forwardlooking statements are made pursuant tothe safe harbour provisions of applicable Canadian securities laws. The Corporation cautions that, b their

nature, forwardlooking statements involve risks and uncertainties, and that its actual actions and/or results

could differ materiall from those expressed or implied in such forwardlooking statements, or could affect the

extent to which a particular projection materialies. Forwardlooking statements are presented for the purpose

of assisting investors and others in understanding certain ke elements of the Corporations current

objectives, strategic priorities, expectations and plans, and in obtaining a better understanding of the

Corporations business and anticipated operating environment. Readers are cautioned that such information

ma not be appropriate for other purposes.

Forwardlooking statements made in this AIF are based on a number of assumptions believed b the Corporation

to be reasonable on March 8, 2013. The assumptions are set out throughout the Compans 2012

Managements Discussion and Analsis (particularl, in the sections entitled Critical Accounting Judgments and

Ke Sources of Estimation Uncertaint and How We Anale and Report Our Results in the Compans 2012Managements Discussion and Analsis). If these assumptions are inaccurate, the Corporations actual results

could differ materiall from those expressed or implied in such forwardlooking statements. In addition,

important risk factors could cause the Corporations assumptions and estimates to be inaccurate and actual

results or events to differ materiall from those expressed in or implied b these forwardlooking statements.

These risks include, but are not limited to: (a) the outcome of pending and future claims and litigation could have

a material adverse impact on the Compans business, financial condition and results of operation; (b) the

Compan is subject to ongoing investigations which could adversel affect its business, results of operations or

reputation and which could subject it to sanctions, fines or monetar penalties, some of which ma be

significant; (c) further regulator developments could have a significant adverse impact on the Compans

results, and emploee, agent or partner misconduct or failure to compl with antibriber and other government


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laws and regulations could harm the Compans reputation, reduce its revenues and net income, and subject the

Compan to criminal and civil enforcement actions; (d) a negative impact on the Compans public image could

influence its abilit to obtain future projects; (e) fixedprice contracts or the Compans failure to meet

contractual schedule or performance requirements ma increase the volatilit and unpredictabilit of its revenue

and profitabilit; (f) the Compans revenue and profitabilit are largel dependent on the awarding of new

contracts, which it does not directl control, and the uncertaint of contract award timing could have an adverse

effect on the Compans abilit to match its workforce sie with its contract needs; (g) the Compans backlog issubject to unexpected adjustments and cancellations, including under termination for convenience provisions,

and does not represent a guarantee of the Compans future revenues or profitabilit; (h) SNCLavalin is a

provider of services to government agencies and is exposed to risks associated with government contracting; (i)

the Compans international operations are exposed to various risks and uncertainties, including unfavourable

political environments, weak foreign economies and the exposure to foreign currenc risk; (j) there are risks

associated with the Compans ownership interests in ICI that could adversel affect it; (k) the Compan is

dependent on third parties to complete man of its contracts; (l) the Compans use of joint ventures and

partnerships exposes it to risks and uncertainties, man of which are outside of the Compans control; (m) the

competitive nature of the markets in which the Compan does business could adversel affect it; (n) the

Compans project execution activities ma result in professional liabilit or liabilit for fault services; (o) the

Compan could be subject to monetar damages and penalties in connection with professional and engineering

reports and opinions that it provides; (p) the Compan ma not have in place sufficient insurance coverage to

satisf its needs; (q) the Compans emploees work on projects that are inherentl dangerous and a failure to

maintain a safe work site could result in significant losses and/or an inabilit to obtain future projects; (r) the

Compans failure to attract and retain qualified personnel could have an adverse effect on its activities; (s) work

stoppages, union negotiations and other labour matters could adversel affect the Compan; (t) the Compan

relies on information sstems and data in its operations. Failure in the availabilit or securit of the Compans

information sstems or in data securit could adversel affect its business and results of operations; (u) an

acquisition or other investment ma present risks or uncertainties; (v) a

Documents

2013 Annual Annual-Information-Form 351