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RIVERWOOD INTERNATIONAL CORPORATION
(formerly named Riverwood International U.S.A., Inc.)
RESTATED BY-LAWS
As amended effective as of October 8, 1996
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RIVERWOOD INTERNATIONAL CORPORATION
RESTATED BY-LAWS
TABLE OF CONTENTS
SECTION PAGE
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ARTICLE I STOCKHOLDERS . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.01. Annual Meetings. . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Special Meetings . . . . . . . . . . . . . . . . . . . 1
Section 1.03. Notice of Meetings; Waiver . . . . . . . . . . . . . . 2
Section 1.04. Quorum . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.05. Voting . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.06. Voting by Ballot . . . . . . . . . . . . . . . . . . . 3
Section 1.07. Adjournment. . . . . . . . . . . . . . . . . . . . . . 3
Section 1.08. Proxies. . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.09. Organization; Procedure. . . . . . . . . . . . . . . . 4
Section 1.10. Consent of Stockholders in Lieu of Meeting . . . . . . 4
ARTICLE II BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . 5
Section 2.01. General Powers . . . . . . . . . . . . . . . . . . . . 5
Section 2.02. Number and Term of Office. . . . . . . . . . . . . . . 5
Section 2.03. Election of Directors. . . . . . . . . . . . . . . . . 7
Section 2.04. Annual and Regular Meetings. . . . . . . . . . . . . . 7
Section 2.05. Special Meetings; Notice . . . . . . . . . . . . . . . 8
Section 2.06. Quorum; Voting . . . . . . . . . . . . . . . . . . . . 8
Section 2.07. Adjournment. . . . . . . . . . . . . . . . . . . . . . 8
Section 2.08. Action Without a Meeting . . . . . . . . . . . . . . . 8
Section 2.09. Regulations; Manner of Acting. . . . . . . . . . . . . 8
Section 2.10. Action by Telephonic Communications. . . . . . . . . . 9
Section 2.11. Resignations . . . . . . . . . . . . . . . . . . . . . 9
Section 2.12. Removal of Directors . . . . . . . . . . . . . . . . . 9
Section 2.13. Vacancies and Newly Created Directorships . . . . . . 9
Section 2.14. Compensation . . . . . . . . . . . . . . . . . . . . . 10
Section 2.15. Reliance on Accounts and Reports, etc. . . . . . . . . 10
ARTICLE III EXECUTIVE COMMITTEE AND OTHER COMMITTEES . . . . . . . . 11
Section 3.01. How Constituted. . . . . . . . . . . . . . . . . . . . 11
Section 3.02. Powers . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.03. Proceedings. . . . . . . . . . . . . . . . . . . . . . 13
Section 3.04. Quorum and Manner of Acting. . . . . . . . . . . . . . 13
Section 3.05. Action by Telephonic Communications. . . . . . . . . . 14
Section 3.06. Absent or Disqualified Members of Additional
Committees . . . . . . . . . . . . . . . . . . . . . . 14
Section 3.07. Resignations . . . . . . . . . . . . . . . . . . . . . 14
Section 3.08. Removal. . . . . . . . . . . . . . . . . . . . . . . . 14
Section 3.09. Vacancies. . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE IV OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4.01. Number . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4.02. Election . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4.03. Salaries . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4.04. Removal and Resignation; Vacancies . . . . . . . . . . 15
Section 4.05. Authority and Duties of Officers . . . . . . . . . . . 15
Section 4.06. The President and Chief Executive Officer . . . . . . 16
Section 4.07. The Chief Operating Officer. . . . . . . . . . . . . . 17
Section 4.08. The Vice Presidents. . . . . . . . . . . . . . . . . . 17
Section 4.09. The Secretary. . . . . . . . . . . . . . . . . . . . . 17
Section 4.10. The Chief Financial Officer. . . . . . . . . . . . . . 18
Section 4.11. The Treasurer. . . . . . . . . . . . . . . . . . . . . 19
Section 4.12. Additional Officers. . . . . . . . . . . . . . . . . . 20
Section 4.13. Security . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE V CAPITAL STOCK. . . . . . . . . . . . . . . . . . . . . . 20
Section 5.01. Certificates of Stock. . . . . . . . . . . . . . . . . 20
Section 5.02. Signatures; Facsimile. . . . . . . . . . . . . . . . . 21
Section 5.03. Lost, Stolen or Destroyed Certificates . . . . . . . . 21
Section 5.04. Transfer of Stock. . . . . . . . . . . . . . . . . . . 21
Section 5.05. Record Date. . . . . . . . . . . . . . . . . . . . . . 22
Section 5.06. Registered Stockholders. . . . . . . . . . . . . . . . 23
Section 5.07. Transfer Agent and Registrar . . . . . . . . . . . . . 23
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ARTICLE VI INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . 23
Section 6.01. Nature of Indemnity. . . . . . . . . . . . . . . . . . 23
Section 6.02. Successful Defense . . . . . . . . . . . . . . . . . . 24
Section 6.03. Determination That Indemnification Is Proper . . . . . 25
Section 6.04. Advance Payment of Expenses. . . . . . . . . . . . . . 25
Section 6.05. Procedure for Indemnification of Directors and
Officers . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.06. Survival; Preservation of Other Rights . . . . . . . . 26
Section 6.07. Insurance. . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.08. Severability . . . . . . . . . . . . . . . . . . . . . 27
Section 6.09. Definitions. . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE VII OFFICES. . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 7.01. Registered Office. . . . . . . . . . . . . . . . . . . 28
Section 7.02. Other Offices. . . . . . . . . . . . . . . . . . . . . 28
ARTICLE VIII GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . 28
Section 8.01. Dividends. . . . . . . . . . . . . . . . . . . . . . . 28
Section 8.02. Reserves . . . . . . . . . . . . . . . . . . . . . . . 29
Section 8.03. Execution of Instruments . . . . . . . . . . . . . . . 29
Section 8.04. Corporate Indebtedness . . . . . . . . . . . . . . . . 29
Section 8.05. Deposits . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.06. Checks . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.07. Sale, Transfer, etc. of Securities . . . . . . . . . . 30
Section 8.08. Voting as Stockholder. . . . . . . . . . . . . . . . . 30
Section 8.09. Fiscal Year. . . . . . . . . . . . . . . . . . . . . . 31
Section 8.10. Seal . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 8.11. Books and Records; Inspection. . . . . . . . . . . . . 31
Section 8.12. Definitions. . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE IX AMENDMENT OF BY-LAWS . . . . . . . . . . . . . . . . . . 32
Section 9.01. Amendment. . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE X CONSTRUCTION . . . . . . . . . . . . . . . . . . . . . . 33
Section 10.01. Construction . . . . . . . . . . . . . . . . . . . . . 33
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RIVERWOOD INTERNATIONAL CORPORATION
RESTATED BY-LAWS
As amended effective as of October 8, 1996
Certain defined terms used herein without definition shall have the
meanings set forth in Section 8.12.
ARTICLE I
STOCKHOLDERS
Section 1.01. ANNUAL MEETINGS. The annual meeting of the stockholders
of the Corporation for the election of directors and for the transaction of such
other business as properly may come before such meeting shall be held at such
place, either within or without the State of Delaware, and at 10:00 a.m. local
time on the first Tuesday in May (or, if such day is a legal holiday, then on
the next succeeding business day), or at such other date and hour, as may be
fixed from time to time by resolution of the Board of Directors and set forth in
the notice or waiver of notice of the meeting. [Sections 211(a), (b).](1)
Section 1.02. SPECIAL MEETINGS. Special meetings of the stockholders
may be called at any time by the Chairman or by the Board of Directors. A
special meeting shall be called by (subject to Section 4.06) the President
and Chief Executive Officer or by the Secretary, immediately upon receipt of
a written request therefor by stockholders
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(1) Citations are to the General Corporation Law of the State of Delaware
as in effect on August 15, 1995 (the "DGCL"), and are inserted for
reference only, and do not constitute a part of the By-Laws.
holding in the aggregate not less than a majority of the outstanding shares
of the Corporation at the time entitled to vote at any meeting of the
stockholders. If such officers or the Board of Directors shall fail to call
such meeting within 20 days after receipt of such request, any stockholder
executing such request may call such meeting. Such special meetings of the
stockholders shall be held at such places, within or without the State of
Delaware, as shall be specified in the respective notices or waivers of
notice thereof. [Section 211(d).]
Section 1.03. NOTICE OF MEETINGS; WAIVER. The Secretary or any
Assistant Secretary shall cause written notice of the place, date and hour of
each meeting of the stockholders, and, in the case of a special meeting, the
purpose or purposes for which such meeting is called, to be given personally
or by mail, not less than ten nor more than sixty days prior to the meeting,
to each stockholder of record entitled to vote at such meeting. If such
notice is mailed, it shall be deemed to have been given to a stockholder when
deposited in the United States mail, postage prepaid, directed to the
stockholder at his address as it appears on the record of stockholders of the
Corporation, or, if he shall have filed with the Secretary of the Corporation
a written request that notices to him be mailed to some other address, then
directed to him at such other address. Such further notice shall be given as
may be required by law.
No notice of any meeting of stockholders need be given to any
stockholder who submits a signed waiver of notice, whether before or after
the meeting. Neither the business to be transacted at, nor the purpose of,
any regular or special meeting of the stockholders need be specified in a
written waiver of notice. The attendance of any stockholder at a meeting of
stockholders shall constitute a waiver of notice of such meeting, except when
the stockholder attends a meeting for the express purpose of objecting, at
the beginning of the meeting, to the trans-
2
action of any business on the ground that the meeting is not lawfully called
or convened. [Sections 222, 229.]
Section 1.04. QUORUM. Except as otherwise required by law or by the
Certificate of Incorporation, the presence in person or by proxy of the
holders of record of a majority of the shares entitled to vote at a meeting
of stockholders shall constitute a quorum for the transaction of business at
such meeting. [Section 216.]
Section 1.05. VOTING. If, pursuant to Section 5.05 of these By-Laws, a
record date has been fixed, every holder of record of shares entitled to vote
at a meeting of stockholders shall be entitled to one vote for each share
outstanding in his name on the books of the Corporation at the close of
business on such record date. If no record date has been fixed, then every
holder of record of shares entitled to vote at a meeting of stockholders
shall be entitled to one vote for each share of stock standing in his name on
the books of the Corporation at the close of business on the day next
preceding the day on which notice of the meeting is given, or, if notice is
waived, at the close of business on the day next preceding the day on which
the meeting is held. Except as otherwise required by law or by the
Certificate of Incorporation, the vote of a majority of the shares
represented in person or by proxy at any meeting at which a quorum is present
shall be sufficient for the transaction of any business at such meeting.
[Sections 212(a), 216.]
Section 1.06. VOTING BY BALLOT. No vote of the stockholders need be
taken by written ballot or conducted by Inspectors of Elections unless otherwise
required by law. Any vote which need not be taken by ballot may be conducted in
any manner approved by the meeting.
Section 1.07. ADJOURNMENT. If a quorum is not present at any meeting
of the stockholders, the stockholders present in person or by proxy shall
have the power to adjourn any such meeting from time to time until a quorum is
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present. Notice of any adjourned meeting of the stockholders of the
Corporation need not be given if the place, date and hour thereof are
announced at the meeting at which the adjournment is taken, provided,
however, that if the adjournment is for more than thirty days, or if after
the adjournment a new record date for the adjourned meeting is fixed pursuant
to Section 5.05 of these By-Laws, a notice of the adjourned meeting,
conforming to the requirements of Section 1.03 hereof, shall be given to each
stockholder of record entitled to vote at such meeting. At any adjourned
meeting at which a quorum is present, any business may be transacted that
might have been transacted on the original date of the meeting.
[Section 222(c).]
Section 1.08. PROXIES. Any stockholder entitled to vote at any meeting
of the stockholders or to express consent to or dissent from corporate action
without a meeting may authorize another person or persons to vote at any such
meeting and express such consent or dissent for him by proxy. A stockholder
may authorize a valid proxy by executing a written instrument signed by such
stockholder, or by causing his or her signature to be affixed to such writing
by any reasonable means including, but not limited to, by facsimile
signature, or by transmitting or authorizing the transmission of a telegram,
cablegram or other means of electronic transmission to the person designated
as the holder of the proxy, a proxy solicitation firm or a like authorized
agent. No such proxy shall be voted or acted upon after the expiration of
three years from the date of such proxy, unless such proxy provides for a
longer period. Every proxy shall be revocable at the pleasure of the
stockholder executing it, except in those cases where applicable law provides
that a proxy shall be irrevocable. A stockholder may revoke any proxy which
is not irrevocable by attending the meeting and voting in person or by filing
an instrument in writing revoking the proxy or by filing another duly
executed proxy bearing a later date with the Secretary. Proxies by telegram,
cablegram or other electronic transmission must either set forth or be
submitted with information from which it can be determined that the
4
telegram, cablegram or other electronic transmission was authorized by the
stockholder. Any copy, facsimile telecommunication or other reliable
reproduction of a writing or transmission created pursuant to this section
may be substituted or used in lieu of the original writing or transmission
for any and all purposes for which the original writing or transmission could
be used, provided that such copy, facsimile telecommunication or other
reproduction shall be a complete reproduction of the entire original writing
or transmission. [Sections 212(b), (c), (d), (e).]
Section 1.09. ORGANIZATION; PROCEDURE. At every meeting of
stockholders the presiding officer shall be (subject to Section 4.06) the
President and Chief Executive Officer or, in the event of his absence,
disability or other inability so to act, a presiding officer chosen by a
majority of the stockholders present in person or by proxy. The Secretary,
or in the event of his absence or disability, the Assistant Secretary, if
any, or if there be no Assistant Secretary, in the absence of the Secretary,
an appointee of the presiding officer, shall act as Secretary of the meeting.
The order of business and all other matters of procedure at every meeting of
stockholders may be determined by such presiding officer.
Section 1.10. CONSENT OF STOCKHOLDERS IN LIEU OF MEETING. To the
fullest extent permitted by law, whenever the vote of stockholders at a
meeting thereof is required or permitted to be taken for or in connection
with any corporate action, such action may be taken without a meeting,
without prior notice and without a vote of stockholders, if a consent or
consents in writing, setting forth the action so taken, shall be signed by
the holders of outstanding stock having not less than the minimum number of
votes that would be necessary to authorize or take such action at a meeting
at which all shares entitled to vote thereon were present and voted and shall
be delivered to the Corporation by delivery to its registered office in the
State of Delaware, its principal place of business, or an officer or agent of
the Corporation having custody of the book in which
5
proceedings of meetings of stockholders are recorded. Delivery made to the
Corporation's registered office shall be by hand or by certified or
registered mail, return receipt requested.
Every written consent shall bear the date of signature of each
stockholder or member who signs the consent and no written consent shall be
effective to take the corporate action referred to therein unless, within
sixty days of the earliest dated consent delivered in the manner required by
law to the Corporation, written consents signed by a sufficient number of
holders or members to take action are delivered to the Corporation by
delivery to its registered office in the State of Delaware, its principal
place of business, or an officer or agent of the Corporation having custody
of the book in which proceedings of meetings of stockholders or members are
recorded. Delivery made to the Corporation's registered office shall be by
hand or by certified or registered mail, return receipt requested.
[Section 228(a), (c).]
ARTICLE II
BOARD OF DIRECTORS
Section 2.01. GENERAL POWERS. Except as may otherwise be provided by
law, by the Certificate of Incorporation or by these By-Laws, the property,
affairs and business of the Corporation shall be managed by or under the
direction of the Board of Directors and the Board of Directors may exercise
all the powers of the Corporation. [Section 141(a).]
Section 2.02. NUMBER AND TERM OF OFFICE. Certain stockholders of
Riverwood Holding, the sole stockholder of the sole stockholder of the
Corporation, shall have rights and obligations with respect to the nomination
and election of Directors of the Corporation as set forth in the Stockholders
Agreement during the term of such agreement. The
6
number of Directors constituting the entire Board of Directors shall be at
least 10 and no more than 14, which number may be modified from time to time
by resolution of the Board of Directors, but in no event shall the number of
Directors be less than one, PROVIDED that for so long as Section 1 of the
Stockholders Agreement is in effect the number of Directors shall in any
event be automatically increased or decreased in the manner set forth below:
(a) If and to the extent permitted by applicable law, (1) upon the
termination for any reason of any Nominating Party's right to nominate one or
more persons to serve as a Director or Directors of the Corporation
(including any temporary termination attributable to the waiver by such
Nominating Party of its rights under the Stockholders Agreement), such
Director or Directors shall be deemed to be removed without cause in
accordance with Section 141(k) of the DGCL and the number of Directors shall
be automatically reduced by such number of Directors that the Nominating
Party would otherwise be entitled to nominate (or such lesser number the
Nominating Party had previously elected to nominate) and (2) upon the request
of a Nominating Party to nominate one or more Directors pursuant to Section 1
of the Stockholders Agreement, the number of Directors of the Corporation
shall be automatically increased by such number of Directors as such
Nominating Party is entitled to nominate (or such lesser number the
Nominating Party elects to nominate), PROVIDED that, if any such nominee is
an Unaffiliated Nominee, the number of Directors shall not be so increased
unless and until the Board of Directors of the Corporation shall have
approved such Unaffiliated Nominee.
(b) During any period in which any Nominating Party has, and shall have
exercised, the right to nominate a Director as provided herein, in the event
of any vacancy or vacancies in the Board of Directors created by the death,
disability, retirement, resignation or removal, with or without cause, of a
Director so nominated, (1) the Board will request such Nominating Party to
nominate a candidate
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to be appointed by such Board to fill such vacancy or (2) in the event that a
candidate to fill such vacancy is to be elected at the annual meeting of
stockholders of the Corporation, such Nominating Party shall have the right
to nominate the individual to fill such vacancy, and the provisions of
Section 1(b) of the Stockholders Agreement shall apply with respect to the
nomination and election of such nominee to fill such vacancy.
(c) Each Director (whenever elected) shall hold office until his
successor has been duly elected and qualified, or until his earlier death,
resignation or removal. [Section 141(b).]
(d) During the term of the Stockholders Agreement, the Chairman of the
Board shall be selected by the Directors from one of the Directors nominated
pursuant to the Stockholders Agreement by the CDR Fund. The Chairman of the
Board shall not be an officer of the Corporation, except that the Chairman
may act as the chief executive officer of the Corporation if elected to that
position by the Board of Directors, and shall preside at all meetings of the
Board of Directors at which he is present. [Section 141(b).]
Section 2.03. ELECTION OF DIRECTORS. Except as otherwise provided in
Sections 2.12 and 2.13 of these By-Laws, the Directors shall be elected at
each annual meeting of the stockholders in a manner which complies with the
provisions of Section 2.02 of these By-Laws, and Section 1 of the
Stockholders Agreement during the term of such agreement. If the annual
meeting for the election of Directors is not held on the date designated
therefor, the Directors shall cause the meeting to be held as soon thereafter
as convenient. At each meeting of the stockholders for the election of
Directors, provided a quorum is present, the Directors shall be elected by a
plurality of the votes validly cast in such election.
[Sections 211(b), (c), 216.]
8
Section 2.4. ANNUAL AND REGULAR MEETINGS. The annual meeting of the
Board of Directors for the purpose of electing officers and for the
transaction of such other business as may come before the meeting shall be
held as soon as possible following adjournment of the annual meeting of the
stockholders at the place of such annual meeting of the stockholders. Notice
of such annual meeting of the Board of Directors need not be given. The
Board of Directors from time to time may by resolution provide for the
holding of regular meetings and fix the place (which may be within or without
the State of Delaware) and the date and hour of such meetings. Notice of
regular meetings need not be given, provided, however, that if the Board of
Directors shall fix or change the time or place of any regular meeting,
notice of such action shall be mailed promptly, or sent by telegram, radio or
cable, to each Director who shall not have been present at the meeting at
which such action was taken, addressed to him at his usual place of business,
or shall be delivered to him personally. Notice of such action need not be
given to any Director who attends the first regular meeting after such action
is taken without protesting the lack of notice to him, prior to or at the
commencement of such meeting, or to any Director who submits a signed waiver
of notice, whether before or after such meeting. [Sections 141(g), 229.]
Section 2.5. SPECIAL MEETINGS; NOTICE. Special meetings of the Board
of Directors shall be held whenever called by the Chairman of the Board or by
a majority of the Directors then in office, at such place (within or without
the State of Delaware), date and hour as may be specified in the respective
notices or waivers of notice of such meetings. Special meetings of the Board
of Directors may be called on 24 hours' notice, if notice is given to each
Director personally or by telephone or telegram, or on five days' notice, if
notice is mailed to each Director, addressed to him at his usual place of
business. Notice of any special meeting need not be given to any Director who
attends such meeting without protesting the lack of notice to him, prior to
or at the commencement of such meeting, or
9
to any Director who submits a signed waiver of notice, whether before or
after such meeting, and any business may be transacted thereat.
[Sections 141(g), 229.]
Section 2.06. QUORUM; VOTING. At all meetings of the Board of
Directors, the presence of a majority of the total then authorized number of
Directors shall constitute a quorum for the transaction of business. Except
as otherwise required by law, the vote of a majority of the Directors present
at any meeting at which a quorum is present shall be the act of the Board of
Directors. [Section 141(b).]
Section 2.07. ADJOURNMENT. A majority of the Directors present, whether
or not a quorum is present, may adjourn any meeting of the Board of Directors
to another time or place. No notice need be given of any adjourned meeting
unless the time and place of the adjourned meeting are not announced at the
time of adjournment, in which case notice conforming to the requirements of
Section 2.05 shall be given to each Director.
Section 2.08. ACTION WITHOUT A MEETING. Any action required or
permitted to be taken at any meeting of the Board of Directors may be taken
without a meeting if all members of the Board of Directors consent thereto in
writing, and such writing or writings are filed with the minutes of
proceedings of the Board of Directors. [Section 141(f).]
Section 2.09. REGULATIONS; MANNER OF ACTING. To the extent consistent
with applicable law, the Certificate of Incorporation and these By-Laws, the
Board of Directors may adopt such rules and regulations for the conduct of
meetings of the Board of Directors and for the management of the property,
affairs and business of the Corporation as the Board of Directors may deem
appropriate. The Directors shall act only as a Board, and the individual
Directors shall have no power as such.
10
Section 2.10. ACTION BY TELEPHONIC COMMUNICATIONS. Members of the
Board of Directors may participate in a meeting of the Board of Directors by
means of conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and
participation in a meeting pursuant to this provision shall constitute
presence in person at such meeting. [Section 141(i).]
Section 2.11. RESIGNATIONS. Any Director may resign at any time by
delivering a written notice of resignation, signed by such Director, to the
Chairman of the Board and a copy of such notice to the Secretary. Unless
otherwise specified therein, such resignation shall take effect upon
delivery. [Section 141(b).]
Section 2.12. REMOVAL OF DIRECTORS. Any Director may be removed at any
time, either for or without cause, upon the affirmative vote of the holders
of a majority of the outstanding shares of stock of the Corporation entitled
to vote for the election of such Director, cast at a special meeting of
stockholders called for the purpose, PROVIDED that so long as Section 1(d) of
the Stockholders Agreement is in effect, (a) no such removal without cause
shall occur except as provided in such Section 1(d) and (B) in the event of
the removal of a Director nominated by a Nominating Party for cause, the
provisions of Section 1(d) of the Stockholders Agreement shall apply with
respect to the filling of the vacancy created thereby. Any vacancy in the
Board of Directors caused by any such removal may be filled at such meeting
by the stockholders entitled to vote for the election of the Director so
removed in accordance with Section 2.13 hereof. If such stockholders do not
fill such vacancy at such meeting (or in the written instrument effecting
such removal, if such removal was effected by consent without a meeting),
such vacancy may be filled in the manner provided in Section 2.13 of these
By-Laws. [Section 141(k).]
11
Section 2.13. VACANCIES AND NEWLY CREATED DIRECTORSHIPS. If any
vacancies shall occur in the Board of Directors, by reason of death,
resignation, removal or otherwise, or if the authorized number of Directors
shall be increased, the Directors then in office shall continue to act, and
such vacancies and newly created directorships may be filled by a majority of
the Directors then in office, although less than a quorum, PROVIDED that no
such vacancy in the Board of Directors shall be filled in a manner which
fails to comply with the requirements of Section 2.02 of these By-Laws, and
Section 1(d) of the Stockholders Agreement during the term of such agreement,
and PROVIDED, FURTHER, that the Board of Directors shall from time to time
make such requests for nominations of individuals to fill vacancies in the
Board of Directors as shall be necessary to cause compliance with the
requirements of such Section 2.02, and Section 1(d) of the Stockholders
Agreement during the term of such agreement. A Director elected to fill a
vacancy or a newly created directorship shall hold office until his successor
has been elected and qualified or until his earlier death, resignation or
removal. Any such vacancy or newly created directorship may also be filled
at any time by vote of the stockholders, in the manner provided in Section
1(d) of the Stockholders Agreement during the term of such agreement.
[Sections 141(b), 223.]
Section 2.14. COMPENSATION. The amount, if any, which each Director
shall be entitled to receive as compensation for his services as such shall
be fixed from time to time by resolution of the Board of Directors, PROVIDED
that (A) no director who is an officer or employee of CDR at any time that
CDR is providing consulting services to the Corporation or one or more of its
subsidiaries and (b) no director who is an officer or employee of the
Corporation, shall be entitled to receive any compensation for his or her
services as a Director (although such Director shall be entitled to be
reimbursed for any reasonable out-of-pocket expenses incurred in connection
with his or her services as a Director). [Section 141(h).]
12
Section 2.15. RELIANCE ON ACCOUNTS AND REPORTS, ETC. A Director, or a
member of any Committee designated by the Board of Directors shall, in the
performance of his duties, be fully protected in relying in good faith upon
the records of the Corporation and upon information, opinions, reports or
statements presented to the Corporation by any of the Corporation's officers
or employees, or Committees designated by the Board of Directors, or by any
other person as to the matters the member reasonably believes are within such
other person's professional or expert competence and who has been selected
with reasonable care by or on behalf of the Corporation. [Section 141(e).]
ARTICLE III
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 3.01. HOW CONSTITUTED. The Board of Directors, by resolution
adopted by a majority of the whole Board, (A) shall designate an Executive
Committee, a Compensation and Benefits Committee and an Audit Committee
(each, a "Standing Committee" and, collectively, the "Standing Committees")
and (B) may designate one or more additional committees (each, an "Additional
Committee" and, together with the Standing Committees, the "Committees").
During the term of the Stockholders Agreement, each Standing Committee shall
consist of such number of Directors as provided by this Section 3.01. Each
Additional Committee shall consist of such number of Directors as from time
to time may be fixed by the Board of Directors. The Executive Committee
shall consist of the chief executive officer of the Corporation and four
other Directors selected in the manner provided in Section 2 of the
Stockholders Agreement. One of the Directors nominated by the CDR Fund (as
provided in Section 2(a) of the Stockholders Agreement) shall serve as the
Chairman of the Executive Committee. Each of the Compensation and Benefits
Committee and the Audit Committee shall consist of five Directors who shall
be selected in the manner provided in Section 2 of the Stockholders
Agreement.
13
Any Additional Committee may be abolished or re-designated from time to time
by the Board of Directors. The Board of Directors may designate one or more
Directors as alternate members of any Additional Committee, who may replace
any absent or disqualified member or members at any meeting of Additional
Committee. Members of any Standing Committee or any Additional Committee
shall (and alternate members, if any, of any Additional Committee may) be
designated at the annual meeting of the Board of Directors. Each member of
any Standing Committee or any Additional Committee (and any alternate member
of any Additional Committee) (whether designated at an annual meeting of the
Board of Directors or to fill a vacancy or otherwise) shall hold office until
his successor shall have been designated or until he shall cease to be a
Director, or until his earlier death, resignation or removal.
[Section 141(b),(c).]
Section 3.02. POWERS. During the intervals between the meetings of the
Board of Directors, the Executive Committee, except as otherwise provided in
this section, shall have and may exercise all the powers and authority of the
Board of Directors in the management of the property, affairs and business of
the Corporation. Each such other Committee, except as otherwise provided in
this section, shall have and may exercise such powers of the Board of
Directors as may be provided by resolution or resolutions of the Board of
Directors. Neither the Executive Committee nor any such other Committee shall
have the power or authority:
(a) to amend the Certificate of Incorporation (except that a
Committee may, to the extent authorized in the resolution or resolutions
providing for the issuance of shares of stock adopted by the Board of
Directors as provided in Section 151(a) of the DGCL, fix the designations
and any of the preferences or rights of such shares relating to dividends,
redemption, dissolution, any distribution of assets of the Corporation or
the conversion into, or the exchange of such shares for, shares of any
other class or classes
14
or any other series of the same or any other class or classes of stock of
the Corporation or fix the number of shares of any series of stock or
authorize the increase or decrease of the shares of any series);
(b) to adopt an agreement of merger or consolidation or a certificate
of ownership or merger;
(c) to recommend to the stockholders the sale, lease or exchange of
all or substantially all of the Corporation's property and assets;
(d) to recommend to the stockholders a dissolution of the Corporation
or a revocation of a dissolution;
(e) to declare a dividend;
(f) to authorize the issuance of stock;
(g) to remove the President and Chief Executive Officer of the
Corporation or a Director;
(h) (i) to authorize the Corporation to enter into or amend any
agreement for the borrowing of funds which provides for additional
indebtedness in excess of $25 million or (ii) to authorize a material
modification of any existing facility, unless, in the Executive Committee's
good faith judgment, such modification is not adverse to the Corporation;
(i) to authorize the Corporation to enter into any guarantee of
indebtedness in excess of $25 million;
(j) to authorize any new compensation or benefit program;
(k) to appoint or discharge the Corporation's independent public
accountants;
15
(l) to authorize the annual operating plan, annual capital
expenditure plan and strategic plan;
(m) to abolish or usurp the authority of the Board of Directors; or
(n) to amend these By-Laws of the Corporation.
The Executive Committee shall have, and any such other Committee may be granted
by the Board of Directors, power to authorize the seal of the Corporation to be
affixed to any or all papers which may require it. [Section 141(c).]
Section 3.03. PROCEEDINGS. Each such Committee may fix its own rules of
procedure and may meet at such place (within or without the State of
Delaware), at such time and upon such notice, if any, as it shall determine
from time to time. Each such Committee shall keep minutes of its proceedings
and shall present a report of such proceedings, including the minutes
thereof, to the Board of Directors at the meeting of the Board of Directors
next following any such proceedings.
Section 3.04. QUORUM AND MANNER OF ACTING. Except as may be otherwise
provided in the resolution creating any Additional Committee, at all meetings
of any Committee the presence of members (or alternate members) constituting
a majority of the total then authorized membership of such Committee shall
constitute a quorum for the transaction of business. The act of the majority
of the members present at any meeting at which a quorum is present shall be
the act of such Committee. Any action required or permitted to be taken at
any meeting of any such Committee may be taken without a meeting, if all
members of such Committee shall consent to such action in writing and such
writing or writings are filed with the minutes of the proceedings of the
Committee. The members of any such Committee shall act only as a Committee,
and the individual members of such Committee shall have no power as such.
[Section 141(b), (c), (f).]
16
Section 3.05. ACTION BY TELEPHONIC COMMUNICATIONS. Members of any
Committee designated by the Board of Directors may participate in a meeting
of such Committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and participation in a meeting pursuant to this provision shall
constitute presence in person at such meeting. [Section 141(i).]
Section 3.06. ABSENT OR DISQUALIFIED MEMBERS OF ADDITIONAL COMMITTEES.
In the absence or disqualification of a member of any Additional Committee,
the member or members thereof present at any meeting and not disqualified
from voting, whether or not he or they constitute a quorum, may unanimously
appoint another member of the Board of Directors to act at the meeting in the
place of any such absent or disqualified member. [Section 141(c).]
Section 3.07. RESIGNATIONS. Any member (and any alternate member) of
any Committee may resign at any time by delivering a written notice of
resignation, signed by such member, to the Chairman or (unless the Chairman
is then acting as the chief executive officer of the Corporation) the
President and Chief Executive Officer. Unless otherwise specified therein,
such resignation shall take effect upon delivery. [Section 141(b).]
Section 3.08. REMOVAL. Any member (and any alternate member) of any
Committee may be removed at any time, either for or without cause, by
resolution adopted by a majority of the whole Board of Directors; PROVIDED
that no such action shall be taken with respect to any member of any Standing
Committee that is inconsistent with the provisions of Sections 1(d) and 2 of
the Stockholders Agreement during the term of such agreement.
Section 3.09. VACANCIES. If any vacancy shall occur in any Committee,
by reason of disqualification, death, resignation, removal or otherwise, the
remaining members (and any alternate members) shall continue to act,
17
and any such vacancy may be filled by the Board of Directors; PROVIDED that
no vacancy in any Committee shall be filled in a manner which fails to comply
with the provisions of Section 2 of the Stockholders Agreement during the
term of such agreement.
ARTICLE IV
OFFICERS
Section 4.01. NUMBER. The officers of the Corporation shall be chosen
by the Board of Directors and shall be a President and Chief Executive
Officer, a Chief Operating Officer, a Chief Financial Officer, one or more
Vice Presidents, a Secretary and a Treasurer. The Board of Directors also
may elect one or more Assistant Secretaries and Assistant Treasurers in such
numbers as the Board of Directors may determine. The Board of Directors also
may elect the Chairman to act as the chief executive officer of the
Corporation as provided in Section 4.06. Any number of offices may be held
by the same person. No officer need be a Director of the Corporation.
[Section 142(a), (b).]
Section 4.02. ELECTION. Unless otherwise determined by the Board of
Directors, the officers of the Corporation shall be elected by the Board of
Directors at the annual meeting of the Board of Directors, and shall be
elected to hold office until the next succeeding annual meeting of the Board
of Directors. In the event of the failure to elect officers at such annual
meeting, officers may be elected at any regular or special meeting of the
Board of Directors. Each officer shall hold office until his successor has
been elected and qualified, or until his earlier death, resignation or
removal. [Section 142(b).]
Section 4.03. SALARIES. The salaries of all officers and agents of the
Corporation shall be fixed by the Board of Directors.
18
Section 4.04. REMOVAL AND RESIGNATION; VACANCIES. Any officer may be
removed for or without cause at any time by the Board of Directors. Any
officer may resign at any time by delivering a written notice of resignation,
signed by such officer, to the Board of Directors, the Chairman or (unless
the Chairman shall then be acting as the chief executive officer of the
Corporation) the President and Chief Executive Officer. Unless otherwise
specified therein, such resignation shall take effect upon delivery. Any
vacancy occurring in any office of the Corporation by death, resignation,
removal or otherwise, shall be filled by the Board of Directors.
[Section 142(b), (e).]
Section 4.05. AUTHORITY AND DUTIES OF OFFICERS. The officers of the
Corporation shall have such authority and shall exercise such powers and
perform such duties as may be specified in these By-Laws, except that in any
event each officer shall exercise such powers and perform such duties as may
be required by law. [Section 142(a).]
Section 4.06. THE PRESIDENT AND CHIEF EXECUTIVE OFFICER. The President
and Chief Executive Officer shall, subject to the direction of, and subject
to general or specific resolutions approved by, the Board of Directors, (a)
preside at all meetings of the stockholders at which he is present, and be
the chief executive officer of the Corporation, (b) have general control and
supervision of the policies and operations of the Corporation, see that all
orders and resolutions of the Board of Directors are carried into effect, and
report to the Board of Directors, (c) manage and administer the Corporation's
business and affairs and perform all duties and exercise all powers usually
pertaining to the office of a chief executive officer of a corporation, (d)
have the authority to sign, in the name and on behalf of the Corporation,
checks, orders, contracts, leases, notes, drafts and other documents and
instruments in connection with the business of the Corporation, and together
with the Secretary or an Assistant Secretary, conveyances of real estate and
other documents and instruments to which the seal of the Corporation is
affixed, (e) have
19
the authority to cause the employment or appointment of such employees and
agents of the Corporation as the conduct of the business of the Corporation
may require, to fix their compensation, and to remove or suspend any employee
or agent elected or appointed by the President and Chief Executive Officer or
the Board of Directors, and (f) have such other powers as are contemplated by
the other provisions of these By-Laws. The President and Chief Executive
Officer shall perform such other duties and have such other powers as the
Board of Directors or the Chairman may from time to time prescribe.
Notwithstanding the foregoing, and whether or not the President and Chief
Executive Officer shall then be in office, (i) the Board of Directors may
elect the Chairman to act as the chief executive officer of the Corporation,
and (except to the extent required by the General Corporation Law of the
State of Delaware) may grant and delegate to the Chairman, acting in such
capacity, any or all of the authority, powers and duties, that otherwise may
be held, exercised or performed by the President and Chief Executive Officer
as provided in these By-Laws, and (ii) in the event that the Board of
Directors elects the Chairman to act as the chief executive officer of the
Corporation, the President and Chief Executive Officer shall no longer be the
chief executive officer of the Corporation, and shall not hold, exercise or
perform any authority, powers or duties as an officer of the Corporation
other than as the Board of Directors or the Chairman may prescribe.
Section 4.07. THE CHIEF OPERATING OFFICER. The Chief Operating Officer
shall be the chief operating officer of the Corporation and shall perform, in
general, all duties incident to the office of Chief Operating Officer and
shall be responsible for the operations of the Corporation, including
manufacturing, engineering, marketing, distribution, sales, labor relations
and administrative responsibilities and such other duties as may be specified
in these By-Laws or as may be assigned to him from time to time by (subject
to Section 4.06) the President and Chief Executive Officer (or, if the
Chairman is then acting as chief executive officer of the Corporation, by the
Chairman). The Chief
20
Operating Officer shall report to the President and Chief Executive Officer
(or, if the Chairman is then acting as chief executive officer of the
Corporation, to the Chairman). In the absence of the President and Chief
Executive Officer (or, if the Chairman is then acting as chief executive
officer of the Corporation, the Chairman), the duties of such officer in such
capacity shall be performed and the powers of such officer in such capacity
may be exercised by the Chief Operating Officer; subject in any case to
review and superseding action by (subject to Section 4.06) the President and
Chief Executive Officer (or, if the Chairman is then acting as chief
executive officer of the Corporation, by the Chairman).
Section 4.08. THE VICE PRESIDENTS. Each Vice President shall perform
such duties and exercise such powers as may be assigned to him from time to
time by (subject to Section 4.06) the President and Chief Executive Officer
(or, if the Chairman is then acting as chief executive officer of the
Corporation, by the Chairman).
Section 4.09. THE SECRETARY. The Secretary shall have the following
powers and duties:
(a) He shall keep or cause to be kept a record of all the proceedings
of the meetings of the stockholders and of the Board of Directors in books
provided for that purpose. [Section 142(a).]
(b) He shall cause all notices to be duly given in accordance with
the provisions of these By-Laws and as required by law.
(c) Whenever any Committee shall be appointed pursuant to a
resolution of the Board of Directors, he shall furnish a copy of such
resolution to the members of such Committee.
(d) He shall be the custodian of the records and of the seal of the
Corporation and cause such seal (or
21
a facsimile thereof) to be affixed to all certificates representing
shares of the Corporation prior to the issuance thereof and to all
instruments the execution of which on behalf of the Corporation under
its seal shall have been duly authorized in accordance with these
By-Laws, and when so affixed he may attest the same.
(e) He shall properly maintain and file all books, reports,
statements, certificates and all other documents and records required by
law, the Certificate of Incorporation or these By-Laws.
(f) He shall have charge of the stock books and ledgers of the
Corporation and shall cause the stock and transfer books to be kept in such
manner as to show at any time the number of shares of stock of the
Corporation of each class issued and outstanding, the names (alphabetically
arranged) and the addresses of the holders of record of such shares, the
number of shares held by each holder and the date as of which each became
such holder of record.
(g) He shall sign (unless the Treasurer, an Assistant Treasurer or
Assistant Secretary shall have signed) certificates representing shares of
the Corporation the issuance of which shall have been authorized by the
Board of Directors.
(h) He shall perform, in general, all duties incident to the office
of secretary and such other duties as may be specified in these By-Laws or
as may be assigned to him from time to time by the Board of Directors or
(subject to Section 4.06) the President and Chief Executive Officer (or, if
the Chairman is then acting as chief executive officer of the Corporation,
the Chairman).
Section 4.10. THE CHIEF FINANCIAL OFFICER. The Chief Financial Officer
shall be the chief financial officer
22
of the Corporation and shall have the following powers and duties:
(a) He shall have charge and supervision over and be responsible for
the moneys, securities, receipts and disbursements of the Corporation, and
shall keep or cause to be kept full and accurate records of all receipts of
the Corporation.
(b) He shall render to the Board of Directors or the Audit Committee,
whenever requested, a statement of the financial condition of the
Corporation and of all his transactions as Chief Financial Officer, and
render a full financial report at the annual meeting of the stockholders,
if called upon to do so.
(c) He shall be empowered from time to time to require from all
officers or agents of the Corporation reports or statements giving such
information as he may desire with respect to any and all financial
transactions of the Corporation.
(d) He shall perform, in general, all duties incident to the office
of chief financial officer and such other duties as may be specified in
these By-Laws or as may be assigned to him from time to time by the Board
of Directors or the Chairman of the Board.
(e) The Chief Financial Officer shall report to the President and
Chief Executive Officer (or, if the Chairman is then acting as chief
executive officer of the Corporation, to the Chairman).
Section 4.11. THE TREASURER. The Treasurer shall be the treasurer of
the Corporation and shall have the following powers and duties:
(a) He shall cause the moneys and other valuable effects of the
Corporation to be deposited in the name and to the credit of the
Corporation in such banks or
23
trust companies or with such bankers or other depositaries as shall
be selected in accordance with Section 8.05 of these By-Laws.
(b) He shall cause the moneys of the Corporation to be disbursed by
checks or drafts (signed as provided in Section 8.06 of these By-Laws) upon
the authorized depositaries of the Corporation and cause to be taken and
preserved proper vouchers for all moneys disbursed.
(c) He may sign (unless an Assistant Treasurer or the Secretary or an
Assistant Secretary shall have signed) certificates representing stock of
the Corporation the issuance of which shall have been authorized by the
Board of Directors.
(d) He shall perform, in general, all duties incident to the office
of treasurer and such other duties as may be specified in these By-Laws or
as may be assigned to him from time to time by the Board of Directors or
the Chief Financial Officer, to whom he shall report.
Section 4.12. ADDITIONAL OFFICERS. The Board of Directors may appoint
such other officers and agents as it may deem appropriate, and such other
officers and agents shall hold their offices for such terms and shall
exercise such powers and perform such duties as may be determined from time
to time by the Board of Directors. The Board of Directors from time to time
may delegate to any officer or agent the power to appoint subordinate
officers or agents and to prescribe their respective rights, terms of office,
authorities and duties. Any such officer or agent may remove any such
subordinate officer or agent appointed by him, for or without cause.
[Section 142(a), (b).]
Section 4.13. SECURITY. The Board of Directors may require any
officer, agent or employee of the Corporation to provide security for the
faithful performance of his duties, in such amount and of such character as
may be
24
determined from time to time by the Board of Directors. [Section 142(c).]
ARTICLE V
CAPITAL STOCK
Section 5.01. CERTIFICATES OF STOCK. The shares of the Corporation
shall be represented by certificates, provided that the Board of Directors
may provide by resolution or resolutions that some or all of any or all
classes or series of the stock of the Corporation shall be uncertificated
shares. Any such resolution shall not apply to shares represented by a
certificate until each certificate is surrendered to the Corporation.
Notwithstanding the adoption of such a resolution by the Board of Directors,
every holder of stock in the Corporation represented by certificates and upon
request every holder of uncertificated shares shall be entitled to have a
certificate signed by, or in the name of the Corporation, by (subject to
Section 4.06) the President and Chief Executive Officer (or, if the President
and Chief Executive Officer is not then empowered to do so pursuant to
Section 4.06, the Chairman) or a Vice President, and by the Treasurer or an
Assistant Treasurer, or the Secretary or an Assistant Secretary, representing
the number of shares registered in certificate form. Such certificate shall
be in such form as the Board of Directors may determine, to the extent
consistent with applicable law, the Certificate of Incorporation and these
By-Laws. [Section 158.]
Section 5.02. SIGNATURES; FACSIMILE. Any or all of such signatures on
the certificate may be a facsimile, engraved or printed, to the extent permitted
by law. In case any officer, transfer agent or registrar who has signed, or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect as if he
25
were such officer, transfer agent or registrar at the date of issue.
[Section 158.]
Section 5.03. LOST, STOLEN OR DESTROYED CERTIFICATES. The Board of
Directors may direct that a new certificate be issued in place of any
certificate theretofore issued by the Corporation alleged to have been lost,
stolen or destroyed, upon delivery to the Board of Directors of an affidavit
of the owner or owners of such certificate, setting forth such allegation.
The Board of Directors may require the owner of such lost, stolen or
destroyed certificate, or his legal representative, to give the Corporation a
bond sufficient to indemnify it against any claim that may be made against it
on account of the alleged loss, theft or destruction of any such certificate
or the issuance of any such new certificate. [Section 167.]
Section 5.04. TRANSFER OF STOCK. Upon surrender to the Corporation or
the transfer agent of the Corporation of a certificate for shares, duly
endorsed or accompanied by appropriate evidence of succession, assignment or
authority to transfer, the Corporation shall issue a new certificate to the
person entitled thereto, cancel the old certificate and record the
transaction upon its books. Within a reasonable time after the transfer of
uncertificated stock, the Corporation shall send to the registered owner
thereof a written notice containing the information required to be set forth
or stated on certificates pursuant to Sections 151, 156, 202(a) or 218(a) of
the DGCL. Subject to the provisions of the Certificate of Incorporation and
these By-Laws, the Board of Directors may prescribe such additional rules and
regulations as it may deem appropriate relating to the issue, transfer and
registration of shares of the Corporation. [Section 151(f).]
Section 5.05. RECORD DATE. In order that the Corporation may determine
the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, the Board of Directors may fix a
record date, which record date shall not precede the date on which
26
the resolution fixing the record date is adopted by the Board of Directors,
and which shall not be more than sixty nor less than ten days before the date
of such meeting. A determination of stockholders of record entitled to
notice of or to vote at a meeting of stockholders shall apply to any
adjournment of the meeting, provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.
In order that the Corporation may determine the stockholders entitled to
consent to corporate action in writing without a meeting, the Board of
Directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted by the Board of
Directors, and which date shall not be more than ten days after the date upon
which the resolution fixing the record date is adopted by the Board of
Directors. If no record date has been fixed by the Board of Directors, the
record date for determining stockholders entitled to consent to corporate
action in writing without a meeting, when no prior action by the board of
directors is required by law, shall be the first date on which a signed
written consent setting forth the action taken or proposed to be taken is
delivered to the Corporation by delivery to its registered office in the
State of Delaware, its principal place of business, or an officer or agent of
the Corporation having custody of the book in which proceedings of meetings
of stockholders are recorded. Delivery made to the Corporation's registered
office shall be by hand or by certified or registered mail, return receipt
requested. If no record date has been fixed by the Board of Directors and
prior action by the Board of Directors is required by law, the record date
for determining stockholders entitled to consent to corporate action in
writing without a meeting shall be at the close of business on the day on
which the Board of Directors adopts the resolution taking such prior action.
In order that the Corporation may determine the stockholders entitled to
receive payment of any dividend or other distribution or allotment of any
rights or the stock-
27
holders entitled to exercise any rights in respect of any change, conversion
or exchange of stock, or for the purpose of any other lawful action, the
Board of Directors may fix a record date, which record date shall not precede
the date upon which the resolution fixing the record date is adopted, and
which record date shall be not more than sixty days prior to such action. If
no record date is fixed, the record date for determining stockholders for any
such purpose shall be at the close of business on the day on which the Board
of Directors adopts the resolution relating thereto. [Section 213.]
Section 5.06. REGISTERED STOCKHOLDERS. Prior to due surrender of a
certificate for registration of transfer, the Corporation may treat the
registered owner as the person exclusively entitled to receive dividends and
other distributions, to vote, to receive notice and otherwise to exercise all
the rights and powers of the owner of the shares represented by such
certificate, and the Corporation shall not be bound to recognize any
equitable or legal claim to or interest in such shares on the part of any
other person, whether or not the Corporation shall have notice of such claim
or interests. Whenever any transfer of shares shall be made for collateral
security, and not absolutely, it shall be so expressed in the entry of the
transfer if, when the certificates are presented to the Corporation for
transfer or uncertificated shares are requested to be transferred, both the
transferor and transferee request the Corporation to do so. [Section 159.]
Section 5.07. TRANSFER AGENT AND REGISTRAR. The Board of Directors may
appoint one or more transfer agents and one or more registrars, and may
require all certificates representing shares to bear the signature of any
such transfer agents or registrars.
28
ARTICLE VI
INDEMNIFICATION
Section 6.01. NATURE OF INDEMNITY. The Corporation shall indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he is
or was or has agreed to become a director, officer, employee or agent of the
Corporation, or is or was serving or has agreed to serve at the request of
the Corporation as a director, officer, employee or agent, of another
corporation, partnership, joint venture, trust or other enterprise, or by
reason of any action alleged to have been taken or omitted in such capacity,
and may indemnify any person who was or is a party or is threatened to be
made a party to such an action, suit or proceeding by reason of the fact that
he is or was or has agreed to become an employee or agent of the Corporation,
or is or was serving or has agreed to serve at the request of the Corporation
as an employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by him or on his behalf in connection with such action, suit or
proceeding and any appeal therefrom, if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests
of the Corporation, and, with respect to any criminal action or proceeding
had no reasonable cause to believe his conduct was unlawful; except that in
the case of an action or suit by or in the right of the Corporation to
procure a judgment in its favor (1) such indemnification shall be limited to
expenses (including attorneys' fees) actually and reasonably incurred by such
person in the defense or settlement of such action or suit, and (2) no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Corporation
unless and only to the extent that the Delaware Court of Chancery or
29
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled
to indemnity for such expenses which the Delaware Court of Chancery or such
other court shall deem proper.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of NOLO CONTENDERE or its equivalent,
shall not, of itself, create a presumption that the person did not act in
good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his
conduct was unlawful. [Section 145(a), (b).]
Section 6.02. SUCCESSFUL DEFENSE. To the extent that a director,
officer, employee or agent of the Corporation has been successful on the
merits or otherwise in defense of any action, suit or proceeding referred to
in Section 6.01 hereof or in defense of any claim, issue or matter therein,
he shall be indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection therewith. [Section 145(c).]
Section 6.03. DETERMINATION THAT INDEMNIFICATION IS PROPER. Any
indemnification under Section 6.01 hereof (unless ordered by a court) shall
be made by the Corporation unless a determination is made that
indemnification of the director, officer, employee or agent is not proper in
the circumstances because he has not met the applicable standard of conduct
set forth in Section 6.01 hereof. Any such determination shall be made (1)
by a majority vote of the directors who are not parties to such action, suit
or proceeding, even though less than a quorum, or (2) if there are no such
directors, or, if such directors so direct, by independent legal counsel in a
written opinion, or (3) by the stockholders. [Section 145(d).]
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Section 6.04. ADVANCE PAYMENT OF EXPENSES. Expenses (including
attorneys' fees) incurred by a director or officer in defending any civil,
criminal, administrative or investigative action, suit or proceeding shall be
paid by the Corporation in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on behalf of the
director or officer to repay such amount if it shall ultimately be determined
that he is not entitled to be indemnified by the Corporation as authorized in
this Article. Such expenses (including attorneys' fees) incurred by other
employees and agents may be so paid upon such terms and conditions, if any,
as the Board of Directors deems appropriate. The Board of Directors may
authorize the Corporation's counsel to represent such director, officer,
employee or agent in any action, suit or proceeding, whether or not the
Corporation is a party to such action, suit or proceeding. [Section 145(e).]
Section 6.05. PROCEDURE FOR INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Any indemnification of a person seeking indemnification under Sections 6.01
and 6.02, or advance of costs, charges and expenses to such person under
Section 6.04 of this Article, shall be made promptly, and in any event within
30 days, upon the written request of such person. If a determination by the
Corporation that such person is entitled to indemnification pursuant to this
Article is required, and the Corporation fails to respond within sixty days
to a written request for indemnity, the Corporation shall be deemed to have
approved such request. If the Corporation denies a written request for
indemnity or advancement of expenses, in whole or in part, or if payment in
full pursuant to such request is not made within 30 days, the right to
indemnification or advances as granted by this Article shall be enforceable
by the indemnified person in any court of competent jurisdiction. Such
person's costs and expenses incurred in connection with successfully
establishing his right to indemnification, in whole or in part, in any such
action shall also be indemnified by the Corporation. It shall be a defense
to any such action (other than an action brought to enforce a claim for the
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advance of costs, charges and expenses under Section 6.04 of this Article
where the required undertaking, if any, has been received by the Corporation)
that the claimant has not met the standard of conduct set forth in Section
6.01 of this Article, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of
Directors, its independent legal counsel, and its stockholders) to have made
a determination prior to the commencement of such action that indemnification
of the claimant is proper in the circumstances because he has met the
applicable standard of conduct set forth in Section 6.01 of this Article, nor
the fact that there has been an actual determination by the Corporation
(including its Board of Directors, its independent legal counsel, and its
stockholders) that the claimant has not met such applicable standard of
conduct, shall be a defense to the action or create a presumption that the
claimant has not met the applicable standard of conduct.
Section 6.06. SURVIVAL; PRESERVATION OF OTHER RIGHTS. The foregoing
indemnification provisions shall be deemed to be a contract between the
Corporation and each director, officer, employee and agent who serves in any
such capacity at any time while these provisions as well as the relevant
provisions of the Delaware Corporation Law are in effect and any repeal or
modification thereof shall not affect any right or obligation then existing
with respect to any state of facts then or previously existing or any action,
suit or proceeding previously or thereafter brought or threatened based in
whole or in part upon any such state of facts. Such a "contract right" may
not be modified retroactively without the consent of such director, officer,
employee or agent.
The indemnification and advancement of expenses provided by this Article
VI shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any by-law, agreement, vote of stockholders
or disinterested directors or otherwise, both as to action in his
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official capacity and as to action in another capacity while holding such
office, and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person. [Section 145(f), (j).]
Section 6.07. INSURANCE. The Corporation shall have the power to
purchase and maintain insurance on behalf of any person who is or was or has
agreed to become a director, officer, employee or agent of the Corporation,
or is or was serving at the request of the Corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and incurred by him or on his behalf in any such capacity, or arising out of
his status as such, whether or not the Corporation would have the power to
indemnify him against such liability under the provisions of this Article.
[Section 145(g).]
Section 6.08. SEVERABILITY. If this Article or any portion hereof
shall be invalidated on any ground by any court of competent jurisdiction,
then the Corporation shall nevertheless indemnify each director, officer,
employee or agent of the Corporation as to costs, charges and expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
with respect to any action, suit or proceeding, whether civil, criminal,
administrative or investigative, including an action by or in the right of
the Corporation, to the fullest extent permitted by any applicable portion of
this Article that shall not have been invalidated and to the fullest extent
permitted by applicable law.
Section 6.09. DEFINITIONS. For purposes of this Article VI, the
following terms shall have the following meanings:
(a) references to "the Corporation" shall include, in addition to
the resulting corporation, any constituent corporation (including any
constituent of a
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constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify
its directors, officers, employees or agents so that any person who is
or was a director, officer, employee or agent of such constituent
corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise
shall stand in the same position under the provisions of this Article VI
with respect to the resulting or surviving corporation as he would
have with respect to such constituent corporation if its separate
existence had continued;
(b) references to "other enterprises" shall include employee benefit
plans;
(c) references to "fines" shall include any excise taxes assessed on
a person with respect to an employee benefit plan; and
(d) references to "serving at the request of the Corporation" shall
include any service as a director, officer, employee or agent of the
Corporation which imposes duties on, or involves services by, such
director, officer, employee, or agent with respect to an employee benefit
plan, its participants, or beneficiaries.
ARTICLE VII
OFFICES
Section 7.01. REGISTERED OFFICE. The registered office of the
Corporation in the State of Delaware shall be located at Corporation Trust
Center, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ in the City of Wilmington, County of New Castle.
Section 7.02. OTHER OFFICES. The Corporation may maintain offices or
places of business at such other loca-
34
tions within or without the State of Delaware as the Board of Directors may
from time to time determine or as the business of the Corporation may require.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.01. DIVIDENDS. Subject to any applicable provisions of law
and the Certificate of Incorporation, dividends upon the shares of the
Corporation may be declared by the Board of Directors at any regular or
special meeting of the Board of Directors and any such dividend may be paid
in cash, property, or shares of the Corporation's Capital Stock.
A member of the Board of Directors, or a member of any Committee
designated by the Board of Directors, shall be fully protected in relying in
good faith upon the records of the Corporation and upon such information,
opinions, reports or statements presented to the Corporation by any of its
officers or employees, or Committees of the Board of Directors, or by any
other person as to matters the director reasonably believes are within such
other person's professional or expert competence and who has been selected
with reasonable care by or on behalf of the Corporation, as to the value and
amount of the assets, liabilities and/or net profits of the Corporation, or
any other facts pertinent to the existence and amount of surplus or other
funds from which dividends might properly be declared and paid.
[Sections 170, 172, 173.]
Section 8.02. RESERVES. There may be set aside out of any funds of the
Corporation available for dividends such sum or sums as the Board of
Directors, from time to time, in its absolute discretion, thinks proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or
for repairing or maintaining any property of the Corporation or for such
other purpose as the Board of
35
Directors shall think conducive to the interest of the Corporation, and the
Board of Directors may similarly modify or abolish any such reserve.
[Section 171.]
Section 8.03. EXECUTION OF INSTRUMENTS. The Board of Directors may
authorize the President and Chief Executive Officer or any other officer or
agent to enter into any contract or execute and deliver any instrument in the
name and on behalf of the Corporation. Any such authorization may be general
or limited to specific contracts or instruments.
Section 8.04. CORPORATE INDEBTEDNESS. No loan shall be contracted on
behalf of the Corporation, and no evidence of indebtedness shall be issued in
its name, unless authorized by the Board of Directors or, to the extent the
Executive Committee has the power to authorize such loan or evidence of
indebtedness, the Executive Committee. Such authorization may be general or
confined to specific instances. Loans so authorized may be effected at any
time for the Corporation from any bank, trust company or other institution,
or from any firm, corporation or individual. All bonds, debentures, notes
and other obligations or evidences of indebtedness of the Corporation issued
for such loans shall be made, executed and delivered as the Board of
Directors or the Executive Committee, as the case may be, shall authorize.
When so authorized by the Board of Directors or the Executive Committee, as
the case may be, any part of or all the properties, including contract
rights, assets, business or good will of the Corporation, whether then owned
or thereafter acquired, may be mortgaged, pledged, hypothecated or conveyed
or assigned in trust as security for the payment of such bonds, debentures,
notes and other obligations or evidences of indebtedness of the Corporation,
and of the interest thereon, by instruments executed and delivered in the
name of the Corporation.
Section 8.05. DEPOSITS. Any funds of the Corporation may be deposited
from time to time in such banks, trust companies or other depositaries as may
be
36
determined by (a) the Board of Directors or (subject to Section 4.06) the
President and Chief Executive Officer (or, if the Chairman is then acting as
chief executive officer of the Corporation, the Chairman) or (b) such
officers or agents as may be authorized to make such determination by the
Board of Directors or (subject to Section 4.06) the President and Chief
Executive Officer (or, if the Chairman is then acting as chief executive
officer of the Corporation, the Chairman).
Section 8.06. CHECKS. All checks or demands for money and notes of the
Corporation shall be signed by such officer or officers or such agent or
agents of the Corporation, and in such manner, as the Board of Directors or
(subject to Section 4.06) the President and Chief Executive Officer (or, if
the Chairman is then acting as chief executive officer of the Corporation,
the Chairman) from time to time may determine.
Section 8.07. SALE, TRANSFER, ETC. OF SECURITIES. To the extent
authorized by the Board of Directors, (subject to Section 4.06) the President
and Chief Executive Officer (or, if the Chairman is then acting as chief
executive officer of the Corporation, the Chairman) or any other officers
designated by the Board of Directors may sell, transfer, endorse, and assign
any shares of stock, bonds or other securities owned by or held in the name
of the Corporation, and may make, execute and deliver in the name of the
Corporation, under its corporate seal, any instruments that may be
appropriate to effect any such sale, transfer, endorsement or assignment.
Section 8.08. VOTING AS STOCKHOLDER. As directed by resolution of the
Board of Directors or the Executive Committee, (a) (subject to Section 4.06) the
President and Chief Executive Officer (or, if the Chairman is then acting as
chief executive officer of the Corporation, the Chairman) or any Vice President
shall have full power and authority on behalf of the Corporation to attend any
meeting of stockholders of any corporation in which the Corporation may hold
37
stock, and to act, vote (or execute proxies to vote) and exercise in person
or by proxy all other rights, powers and privileges incident to the ownership
of such stock, and (B) such officers acting on behalf of the Corporation
shall have full power and authority to execute any instrument expressing
consent to or dissent from any action of any such corporation without a
meeting. The Board of Directors may by resolution from time to time confer
such power and authority upon any other person or persons.
Section 8.09. FISCAL YEAR. The fiscal year of the Corporation shall
commence on the first day of January of each year (except for the
Corporation's first fiscal year which shall commence on the date of
incorporation) and shall terminate in each case on the last day of December.
Section 8.10. SEAL. The seal of the Corporation shall be circular in
form and shall contain the name of the Corporation, the year of its
incorporation and the words "Corporate Seal" and "Delaware". The form of
such seal shall be subject to alteration by the Board of Directors. The seal
may be used by causing it or a facsimile thereof to be impressed, affixed or
reproduced, or may be used in any other lawful manner.
Section 8.11. BOOKS AND RECORDS; INSPECTION. Except to the extent
otherwise required by law, the books and records of the Corporation shall be
kept at such place or places within or without the State of Delaware as may
be determined from time to time by the Board of Directors.
Section 8.12. DEFINITIONS.
"Additional Committee": See Section 3.01.
"CDR" means ▇▇▇▇▇▇▇, Dubilier & Rice, Inc., a Delaware corporation.
38
"CDR Fund" means ▇▇▇▇▇▇▇, Dubilier & Rice Fund V Limited Partnership, a
Connecticut limited partnership, and any successors and assigns.
"Committee": See Section 3.01.
"Investor": See "Stockholders Agreement."
"Nominating Party" means any one of the investors named in Section 1(b)
of the Stockholders Agreement entitled to nominate such number of persons as
specified therein for election to the Board of Directors of the Corporation.
"Riverwood Holding": Riverwood Holding, Inc., a Delaware corporation
and the sole stockholder of the sole stockholder of the Corporation.
"Standing Committee": See Section 3.01.
"Stockholders Agreement" means the Stockholders Agreement entered into
among Riverwood Holding and each of CDR Fund, EXOR Group S.A., First Plaza
Group Trust, The 1818 Fund II, L.P., Madison Dearborn Capital Partners, L.P.,
Chemical Equity Associates, HWH Investment Pte Ltd. and ▇▇▇▇▇▇▇▇▇▇-River LLC
(each an "Investor" and, collectively, the "Investors"), as amended and as in
effect from time to time.
"Unaffiliated Nominee" means any person nominated for election to the
Board of Directors of the Corporation by a Nominating Party who is not an
employee, officer, general partner or general partner of the general partner
of the Nominating Party or of an Affiliate (as defined in Section 9 of the
Stockholders Agreement) of the Nominating Party.
39
ARTICLE IX
AMENDMENT OF BY-LAWS
Section 9.01. AMENDMENT. These By-Laws may be amended, altered or
repealed
(a) by resolution adopted by a majority of the Board of Directors at
any special or regular meeting of the Board if, in the case of such special
meeting only, notice of such amendment, alteration or repeal is contained
in the notice or waiver of notice of such meeting; or
(b) at any regular or special meeting of the stockholders if, in the
case of such special meeting only, notice of such amendment, alteration or
repeal is contained in the notice or waiver of notice of such meeting.
[Section 109(a).]
Notwithstanding the foregoing sentence, during the term of the
Stockholders Agreement, these By-Laws may not be amended, altered or repealed
in a manner inconsistent with the terms and provisions of the Stockholders
Agreement.
ARTICLE X
CONSTRUCTION
Section 10.01. CONSTRUCTION. In the event of any conflict between the
provisions of these By-Laws as in effect from time to time and (a) the
provisions of the certificate of incorporation of the Corporation as in
effect from time to time, or (b) the provisions of the Stockholders
Agreement, the provisions of such certificate of incorporation or the
Stockholders Agreement, as the case may be, shall be controlling.
40
