The Company is managed by its Board of Directors (i.e., Conselho de Administraćčo), which may consist of no fewer than nine and no more than twelve members (each a "Director"), and its Executive Officers (i.e., Diretoria) which may consist of no fewer than five and no more than eight officers (each an "Officer"). In accordance with the Company's By-Laws, the Board of Directors is elected for a term of three years by the Company's shareholders at the annual shareholders' meeting. The term of office of the current Board of Directors will end on April 30, 2000. See "Item 13. Interest of Management in Certain Transactions— Shareholders' Agreement". The term of office of each Officer will end on May 20, 2000.
At June 28, 1999, the Company's Directors and Officers are:
Board of Directors
Erling Sven Lorentzen Chairman
Haakon Lorentzen Member
Eliezer Batista da Silva Member
Carlos Alberto Vieira Member
Ricardo Antonio Weiss Member
Ladimir Enore Pellizzaro Member
Nelson Pereira dos Reis Member
Isaac Selim Sutton Member
Ernane Galvźas Member
José Mauro Mettreau Carneiro da Cunha Member
Carlos Augusto Lira Aguiar(1) President
Agílio Lečo de Macedo Filho Officer
Jočo Felipe Carsalade Officer
Walter Lídio Nunes(2) Officer
Erling Sven Lorentzen. Mr. Lorentzen has been Chairman of the Board of the Company since April 24, 1972. He is also Chairman of the Board and Chief Executive Officer of Lorentzen Empreendimentos S.A., which indirectly controls Arapar S.A., and is a member of the Executive Committee of the World Business Council for Sustainable Development and a member of the Advisory Board of the American International Group.
Haakon Lorentzen. Mr. Lorentzen has been a Director of the Company since April 29, 1991 and is the son of Mr. Erling Lorentzen. He is Executive Vice President of Lorentzen Empreendimentos S.A., as well as Chairman of Carbo Industrial S.A., Carbo Derivados S.A. and Provida ASA.
Eliezer Batista da Silva. Mr. Batista da Silva has been a Director of the Company since June 28, 1996. He was also Chairman of Rio Doce Internacional. In 1992, he served as the Brazilian Government's Secretary for Strategic Affairs. From 1979 to 1986, he was Chairman of Companhia Vale do Rio Doce and also President of its Board of Officers. He was President of Mineraćões Brasileiras Reunidas S.A. (Caemi Group) from 1964 to 1968, and Minister of Mines and Energy from 1962 to 1964. His first term as Chairman of Companhia Vale do Rio Doce was from 1961 to 1962.
Carlos Alberto Vieira. Mr. Vieira has been a Director of the Company since April 15, 1988. He is also President of the Board of Banco Safra S.A., Safra Leasing S.A. Arrendamento Mercantil, Agropecuária Potrillo S.A., and Pastoril Agropecuária Couto Magalhčes S.A. He is also an officer of Safra Seguradora S.A.
Ricardo Antonio Weiss. Mr. Weiss was elected director of the Company on March 25, 1999. During 1999, he has also been member of the Executive Committee and Regional Manager of Anglo Base Metals for Brazil, Venezuela and Caribbean and responsible for the nickel portfolio worldwide. He is also President of Anglo American Brazil and Salobo Metais S.A. and Board Member of Copebrás S.A. Since 1996, he has been President of Anglo American Venezuela and CEO of Minera Loma de Níquel . From 1992 to 1996, he was Vice-President of Anglo American Brazil. He was also President of Codemin, Morro do Níquel and Mineiraćčo Catalčo de Goiás. From 1987 to 1992 he was Managing Director of Base Metal Divisions of Anglo American Brazil. From 1980 to 1987 he held various managerial positions with the Hochschild Group. From 1978 to 1980, he was associated with Price Waterhouse Consulting Services.
Ladimir Enore Pellizzaro. Mr. Pellizzaro has been a Director of the Company since June 28, 1996. He has also been a Technical Director of GTS, a member of the Mondi Group, since 1993. From 1990 to 1993, he was Mill Manager of Mondi Richards Bay; from 1989 to 1990, he was Acting Engineering Manager for Cia. Suzano de Papel e Celulose; from 1986 to 1989, he was Director of Jaakko Poyry Project, with responsibility for the expansion of the Company’s mill capacity; from 1984 to 1986, he was Industrial Superintendent of Indústrias de Papel Simčo S.A.; from 1976 to 1984, he was Engineering and Development Manager of the Company; and from 1968 to 1976, he was a Production Manager for the Klabin Group.
Nelson Pereira dos Reis. Mr. Reis has been a Director of the Company since April 30, 1997. He is also the President of Copebrás S.A., Vice-President of Minorco Brasil Participaćões Ltda., the holding company of the Minorco Group in Brazil and Vice-President of ANDA National Fertilizer Industry Association.
Isaac Selim Sutton. Mr. Sutton has been a Director of the Company since June 28, 1996. He has also been an Officer and Managing Director of Safra Group since 1994. From 1992 to 1994, he was Executive Director of Indústria e Comércio Cardinalli Ltda. and also a Director of the holding company of Unigel Group. Between 1986 and 1992, he was Marketing and Commercial General Director of Cosmoquímica Indústria e Comércio S.A. and, between 1980 and 1986, Marketing Manager of Dow Chemical S.A.
Ernane Galvźas. Mr. Galvźas has been a Director of the Company since April 29, 1994. He has also been a member of the Technical Committee of the Brazilian Association of Commerce since 1975 and since 1988 he has been the Economic Counsel for the Presidency thereof. Mr. Galvźas has been the President of the Managing Committee of the Brazilian Association for Economic Studies Promotion since 1988, Minister of Finance of Brazil during the period January 1980 to March 1985, and President of the Central Bank of Brazil twice. He was also the Company's chief financial officer during the period 1974 to 1978 and Executive Vice President in 1979.
José Mauro Mettrau Carneiro da Cunha. Mr. Carneiro da Cunha has been a member of the Board since July 4, 1996. He is also Vice-President of Banco Nacional de
Desenvolvimento Econômico e Social — BNDES. From 1995 to January 1999 he was Superintendent Directors of BNDES Participaćões S.A. — BNDESPAR. From 1990 to 1991 he was Executive Director of Agźncia Especial de Financiamento Industrial — FINAME. Mr. Carneiro da Cunha has held various managerial positions with the Project Priorities Department and Administration Area of BNDES. From 1972 to 1973 ha was Engineer and head of Planning Department of Empresa Klabin S.A.
Carlos Augusto Lira Aguiar. Mr. Aguiar became President of the Company on April 17, 1998. He has been an Officer of the Company since October 25, 1985 and a Vice President from April 1993 to April 17, 1998. Due to the resignation of Mr. Armando da Silva Figueira as President, effective at February 11, 1993, Mr. Aguiar was also the Acting President from such date until November 16, 1993. Since 1981, Mr. Aguiar has held various managerial positions with the operations department of the Company.
Agílio Lečo de Macedo Filho. Mr. Macedo Filho has been Chief Financial Officer and Stock Market Relations Officer of the Company since March 15, 1995. Mr. Macedo Filho has held executive positions with other Brazilian corporations, including Courtaulds International Ltda., Companhia Ceras Johnson, Companhia Fiat Lux and Xerox do Brasil.
Jočo Felipe Carsalade. Mr. Carsalade has been an Officer of the Company since September 6, 1993. Since 1976, Mr. Carsalade has held various managerial positions with the commercial department of the Company.
Walter Lídio Nunes. Mr. Nunes has been an Officer of the Company since May 27, 1998. Since 1977, Mr. Nunes has held various managerial positions with the industrial department of the Company.
For the year ended December 31, 1998, the aggregate compensation of all Directors and
Officers of the Company was approximately US$3.7 million which includes bonuses related to 1998 in the amount of US$1.0 million. In addition, for 1998 the Company paid an aggregate of approximately US$125,000 into the Company's Pension Plan on behalf of Directors and Officers of the Company.
The Principal Shareholders are parties to a Shareholders' Agreement, dated January 22,
1988, as amended on June 30, 1989 and June 13, 1996 (the "Shareholders' Agreement"). While the Company is a signatory to the Shareholders' Agreement, its sole obligation under the agreement is to administer compliance by the Principal Shareholders in accordance with the terms of the Shareholders' Agreement. The Shareholders' Agreement relates only to the Company's Common Stock. The Shareholders' Agreement provides that the Principal Shareholders will be entitled to elect directors to the Company's Board of Directors in proportion to their respective proportionate interests in the Company's voting stock, except that each Principal Shareholder is ensured the right to elect at least one director so long as such Principal Shareholder retains 5% or more of the Company's voting stock. Such right is not transferable without the unanimous consent of the other shareholder parties to the Shareholders' Agreement. In addition, the Shareholders' Agreement provides that the maximum number of shares of Common Stock to be held by any Principal Shareholder may not exceed 28% of the total outstanding shares of Common Stock. Furthermore, the Shareholders' Agreement provides that the Principal
Shareholders may sell, encumber or otherwise transfer their rights in the Company's voting stock to any third party as long as the beneficial ownership of 51% or more of such stock is retained by Brazilian nationals. Brazilian nationals are defined as (a) individual residents who are domiciled in Brazil, (b) corporate instrumentalities of the Brazilian government or subdivisions thereof or (c) corporate entities whose headquarters are in, and are incorporated in, Brazil and which, directly or indirectly, are controlled by persons referred to in (a) or (b) above. The Shareholders' Agreement also requires that each person or entity who acquires shares of Common Stock from any of the Principal Shareholders become a party to such agreement.