<PAGE>
As filed with the Securities and Exchange Commission on March 3, 1995
Registration No. 33-________
=============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM S-4
Registration Statement Under The Securities Act of 1933
_______________
MARSHALL & ILSLEY CORPORATION
(Exact name of Registrant as specified in charter)
Wisconsin 6022 39-0968604
(State of Incorporation) (Primary Standard Industrial (I.R.S. Employer
Classification Code No.) Identification No.)
770 North Water Street
Milwaukee, Wisconsin 53201
(Address, including ZIP Code, and telephone number, including area code, of
Registrant's principal executive offices)
_______________
M.A. HATFIELD, Secretary
Marshall & Ilsley Corporation,
770 North Water Street,
Milwaukee, Wisconsin 53202
(414) 765-7801
(Name, address, including ZIP Code, and telephone number, including area
code, of agent for service)
_______________
Copies to:
Randall J. Erickson Rymund P. Wurlitzer
Godfrey & Kahn, S.C. Citizens Bancorp of Delavan, Inc.
780 North Water Street 104 North Fifth Street
Milwaukee, Wisconsin 53202 P.O. Box 307
(414) 273-3500 Delavan, Wisconsin 53115-1637
(414) 728-2606
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of the Registration Statement.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
=============================================================================
Proposed
Title of Each Proposed Maximum
Class of Amount Maximum Aggregate
Securities to to be Offering Price Offering Amount of
be Registered Registered(1) Per Share(2) Price(2) Registration Fee
_____________________________________________________________________________
Common Stock,
$1.00 par value 1,132,562 N/A $20,074,000 $6,922.12
=============================================================================
(1) The number of shares to be registered is based upon an estimate of the
maximum number of shares of Common Stock of the Registrant to be issued
to holders of Common Stock of Citizens Bancorp of Delavan, Inc.
("Citizens Bancorp") pursuant to the Merger (as defined herein).
(2) The registration fee was computed pursuant to Rule 457(f)(2) under the
Securities Act of 1933, as amended, based upon the aggregate book value
of the shares of Citizens Bancorp Common Stock on December 31, 1994
($20,074,000).
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
=============================================================================
<PAGE>
MARSHALL & ILSLEY CORPORATION
Cross Reference Sheet
Registration Statement
Item and Heading Location in Prospectus
1. Forepart of Registration Statement Facing Page of Registration
and Outside Front Cover Page Statement; Cross-Reference
of Prospectus Sheet; Outside Front Cover Page of
Prospectus/Proxy Statement
2. Inside Front and Outside Back Cover Inside Front Cover of
Pages of Prospectus Prospectus/Proxy Statement;
Available Information;
Incorporation of Certain
Information by Reference; Table
of Contents
3. Risk Factors, Ratio of Earnings to Summary
Fixed Charges and Other
Information
4. Terms of the Transaction Incorporation of Certain
Information by Reference;
Summary; The Merger; Comparison
of Shareholder Rights; Certain
Provisions of the Wisconsin
Business Corporation Law
5. Pro Forma Financial Information Not Applicable
6. Material Contacts With the Company Certain Related Transactions
Being Acquired
7. Additional Information Required for Not Applicable
Reoffering by Persons and Parties
Deemed to be Underwriters
8. Interests of Named Experts and Not Applicable
Counsel
9. Disclosure of Commission Position Not Applicable
on Indemnification For Securities
Act Liabilities
10. Information With Respect to S-3 Available Information;
Registrants Incorporation of Certain
Information by Reference;
Summary; Certain Information
Regarding M&I
11. Incorporation of Certain Summary; Incorporation of Certain
Information by Reference Information by Reference
12. Information with Respect to Not Applicable
S-2 o4 S-3 Registrants
13. Incorporation of Certain Not Applicable
Information by Reference
14. Information with Respect to Not Applicable
Registrants other than S-2
or S-3 Registrants
<PAGE>
15. Information with Respect to S-3 Not Applicable
Companies
16. Information with Respect to S-2 Not Applicable
or S-3 Companies
17. Information with Respect to Summary; Certain Information
Companies other than S-3 or S-2 Concerning Citizens
Companies Bancorp; Index to Financial
Statements
18. Information if Proxies, Consents Incorporation of Certain
or Authorizations to be Solicited Information by Reference;
Summary; The Special Meeting;
The Merger - Dissenters' Rights
of Appraisal; The Merger -
Conditions to Merger; Certain
Information Concerning Citizens
Bancorp - Share Ownership;
Certain Information Concerning
M&I; Certain Related
Transactions
19. Information if Proxies, Consents Not Applicable
or Authorizations are not to be
Solicited or in an Exchange Offer
<PAGE>
Citizens Bancorp of Delavan, Inc.
104 North 5th Street
P.O. Box 307
Delavan, Wisconsin 53115-1637
_____________________________
Notice of Special Meeting of Shareholders
To Be Held ________________, 1995
Notice is hereby given that a special meeting of shareholders of
Citizens Bancorp of Delavan, Inc. ("Citizens Bancorp"), a Wisconsin
corporation, will be held on __________, ____________ ___, 1995 at _____ a.m.
local time, at the main office of Citizens Bancorp, 104 North 5th Street,
Delavan, Wisconsin 53115-1637 (the "Special Meeting") for the following
purposes:
1. To consider and act upon a proposal to approve the Agreement and
Plan of Reorganization dated as of August 31, 1994, as amended, between
Citizens Bancorp and Marshall & Ilsley Corporation ("M&I") and a related
Agreement and Plan of Merger between M&I Interim Corp. ("M&I Interim Corp.")
and Citizens Bancorp (all of which are hereinafter collectively referred to
as the "Merger Agreement"), copies of which are attached as Appendix A to the
accompanying Prospectus/Proxy Statement, pursuant to which Citizens Bancorp
will be merged with and into M&I Interim Corp. (the "Merger") and each
outstanding share of Citizens Bancorp's common stock, $1.00 par value, will
be converted into the right to receive 305.85 shares of M&I's common stock,
$1.00 par value, and cash in lieu of fractional shares;
2. To transact such other business as may properly come before the
Special Meeting or any adjournments thereof.
Shareholders are urged to read the accompanying Prospectus/Proxy
Statement completely and carefully. No person has been authorized to give
any information or make any representations not contained in the accompanying
Prospectus/Proxy Statement and if given or made such information and
representations should not be relied upon.
The Board of Directors of Citizens Bancorp has fixed the close of
business on __________, 1995, as the record date (the "Record Date") for
determining the shareholders of Citizens Bancorp entitled to notice of and to
vote at the Special Meeting, and only shareholders of record at such time
will be entitled to such notice and to vote.
THE BOARD OF DIRECTORS OF CITIZENS BANCORP BELIEVES THAT THE PROPOSED
MERGER IS IN THE BEST INTERESTS OF CITIZENS BANCORP AND ITS SHAREHOLDERS AND
RECOMMENDS THAT SHAREHOLDERS OF CITIZENS BANCORP VOTE "FOR" THE MERGER
AGREEMENT.
DISSENTERS' RIGHTS OF APPRAISAL ARE AVAILABLE TO CITIZENS BANCORP
SHAREHOLDERS WHO WISH TO DISSENT FROM THE MERGER AND WHO PROPERLY PERFECT
SUCH RIGHTS.
By order of the Board of Directors
Rymund P. Wurlitzer, Chairman of Board
Delavan, Wisconsin
______________, 1995
_________________________
Your vote is important. Please mark, sign and date the accompanying form of
proxy and return it promptly in the envelope enclosed for your use. The form
of proxy will not be used if you attend the meeting and wish to vote in
person.
The date of the accompanying Prospectus/Proxy Statement is _______________,
1995.
<PAGE>
CITIZENS BANCORP OF DELAVAN, INC.
PROXY STATEMENT
_____________________________
MARSHALL & ILSLEY CORPORATION
PROSPECTUS
1,132,562 SHARES
Common Stock ($1.00 par value)
This Prospectus/Proxy Statement is being furnished in connection with
the solicitation of proxies by the Board of Directors of Citizens Bancorp of
Delavan, Inc. ("Citizens Bancorp"), a Wisconsin corporation, from the holders
of Citizens Bancorp's common stock, $1.00 par value (the "Citizens Bancorp
Stock"), for use at the special meeting of Citizens Bancorp's shareholders to
be held on ____________, 1995 at the time and place set forth in the notice
accompanying this Prospectus/Proxy Statement (the "Special Meeting"). This
Prospectus/Proxy Statement and the accompanying Proxy are being sent to
Citizens Bancorp's shareholders commencing on or about _______________, 1995.
This Prospectus/Proxy Statement constitutes a Prospectus of Marshall &
Ilsley Corporation, a Wisconsin corporation ("M&I"), covering shares of M&I
common stock, $1.00 par value ("M&I Stock"), which may be issued and
delivered pursuant to the Agreement and Plan of Reorganization dated as of
August 31, 1994, as amended, and a related Agreement and Plan of Merger by
and between Citizens Bancorp and M&I Interim Corp., a Wisconsin corporation,
(hereinafter collectively referred to as the "Merger Agreement"). The Merger
Agreement provides for the merger of Citizens Bancorp with and into M&I
Interim Corp. (the "Merger") in which each share of Citizens Bancorp Stock
will be converted into the right to receive 305.85 shares of M&I Stock.
At the Special Meeting, Citizens Bancorp's shareholders will be asked
to consider and act upon all of the transactions contemplated by the Merger
Agreement.
M&I Stock is quoted under the symbol "MRIS" on the National Association
of Securities Dealers Automated Quotations-National Market System
("NASDAQ/NMS"). On March 1, 1995, the closing sale price of M&I Stock
on the NASDAQ/NMS as reported in the Midwest edition of The Wall Street
Journal was $20.75 per share.
The principal executive offices of M&I are located at 770 North Water
Street, Milwaukee, Wisconsin 53202 and its general phone number is (414)
765-7801.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR BY ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS/PROXY STATE-
MENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
__________________________
THE SHARES OF M&I STOCK OFFERED HEREBY ARE NOT DEPOSITS OR SAVINGS ACCOUNTS
AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION
OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
__________________________
The date of this Prospectus/Proxy Statement is _______________________, 1995.
<PAGE>
TABLE OF CONTENTS
Page
AVAILABLE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SUMMARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
M&I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
M&I Interim Corp.. . . . . . . . . . . . . . . . . . . . . . . . . . 3
Citizens Bancorp . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Time, Place and Date of the Special Meeting. . . . . . . . . . . . . 3
Purpose of the Meeting . . . . . . . . . . . . . . . . . . . . . . . 4
Required Vote. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Recommendation of the Board. . . . . . . . . . . . . . . . . . . . . 4
The Merger and the Exchange Ratio. . . . . . . . . . . . . . . . . . 4
Required Regulatory Approval . . . . . . . . . . . . . . . . . . . . 4
Conditions to the Merger . . . . . . . . . . . . . . . . . . . . . . 4
Termination of the Merger Agreement. . . . . . . . . . . . . . . . . 4
Federal Income Tax Consequences. . . . . . . . . . . . . . . . . . . 5
Dissenters' Rights of Appraisal. . . . . . . . . . . . . . . . . . . 5
Selected Per Share Data. . . . . . . . . . . . . . . . . . . . . . . 6
Comparative Stock Prices . . . . . . . . . . . . . . . . . . . . . . 7
Selected Historical Financial Information. . . . . . . . . . . . . . 7
THE SPECIAL MEETING. . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Proposals to be Considered . . . . . . . . . . . . . . . . . . . . . 10
Record Dates and Voting Rights . . . . . . . . . . . . . . . . . . . 10
Voting; Revocation of Proxies. . . . . . . . . . . . . . . . . . . . 10
Solicitation of Proxies. . . . . . . . . . . . . . . . . . . . . . . 10
THE MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
General. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Background of the Merger . . . . . . . . . . . . . . . . . . . . . . 12
Reasons For Approval of the Merger . . . . . . . . . . . . . . . . . 12
Merger Consideration . . . . . . . . . . . . . . . . . . . . . . . . 12
Conversion of Shares; Exchange of Certificates; No Fractional
Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Representations and Warranties . . . . . . . . . . . . . . . . . . . 14
Additional Covenants and Agreements. . . . . . . . . . . . . . . . . 15
No Solicitation of Transactions. . . . . . . . . . . . . . . . . . . 17
Conditions to the Merger . . . . . . . . . . . . . . . . . . . . . . 17
Termination and Amendment. . . . . . . . . . . . . . . . . . . . . . 18
Accounting Treatment . . . . . . . . . . . . . . . . . . . . . . . . 18
Certain Federal Income Tax Consequences. . . . . . . . . . . . . . . 18
Resale of M&I Stock by Affiliates. . . . . . . . . . . . . . . . . . 19
Dissenters' Rights of Appraisal. . . . . . . . . . . . . . . . . . . 19
Regulatory Approvals Required. . . . . . . . . . . . . . . . . . . . 20
Management After the Merger. . . . . . . . . . . . . . . . . . . . . 21
<PAGE>
COMPARISON OF SHAREHOLDER RIGHTS . . . . . . . . . . . . . . . . . . . . . 21
Required Vote for Authorization of Certain Transactions. . . . . . . 21
Amendment of By-laws . . . . . . . . . . . . . . . . . . . . . . . . 22
Size, Classification of, and Vote Required to Elect Board of
Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Removal of Directors for "Cause" . . . . . . . . . . . . . . . . . . 22
Newly Created Directorships and Vacancies on the Board of
Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Advance Notice of Proposals to be Brought at the Annual Meeting. . . 23
Advance Notice of Nominations of Directors . . . . . . . . . . . . . 23
Certain Business Combinations. . . . . . . . . . . . . . . . . . . . 23
Dissenters' Rights of Appraisal. . . . . . . . . . . . . . . . . . . 24
CERTAIN PROVISIONS OF THE WISCONSIN BUSINESS CORPORATION LAW . . . . . . . 24
CERTAIN INFORMATION CONCERNING CITIZENS BANCORP. . . . . . . . . . . . . . 25
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Market Information and Dividends . . . . . . . . . . . . . . . . . . 25
Share Ownership. . . . . . . . . . . . . . . . . . . . . . . . . . . 26
CERTAIN INFORMATION CONCERNING M&I . . . . . . . . . . . . . . . . . . . . 27
CERTAIN RELATED TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . 27
RECENT LEGISLATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
LEGAL OPINION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SHAREHOLDER PROPOSALS. . . . . . . . . . . . . . . . . . . . . . . . . . . 28
INDEX TO FINANCIAL STATEMENTS. . . . . . . . . . . . . . . . . . . . . . . 29
APPENDIX A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A-1
APPENDIX B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B-1
<PAGE>
Except as contained in this Prospectus/Proxy Statement, no person has
been authorized to give any information or make any representations with
respect to Citizens Bancorp, M&I, M&I Interim Corp., the Merger, or the
Merger Agreement; and, if given or made, such other information or
representations, should not be relied upon as having been authorized by
Citizens Bancorp, M&I or M&I Interim Corp. Under no circumstances should the
delivery of this Prospectus/Proxy Statement or the issuance or delivery of
any shares of M&I Stock pursuant to the Merger Agreement create any
implication that there has been no change in the assets, properties,
businesses or affairs of Citizens Bancorp, M&I or M&I Interim Corp. since the
date of this Prospectus/Proxy Statement.
AVAILABLE INFORMATION
Marshall & Ilsley Corporation ("M&I") is subject to the informational
requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") and in accordance therewith files proxy statements, annual
reports and other information with the Securities and Exchange Commission
(the "Commission"). Such proxy statements, reports and other information
concerning M&I can be inspected at Room 1024 of the Commission's offices at
450 Fifth Street, N.W., Washington, D.C. 20549, and at its regional offices
in New York, New York (7 World Trade Center, Suite 1300, New York, New York,
10048) and Chicago, Illinois (Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661). Copies of such material can also be obtained
from the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates.
M&I has filed a Registration Statement on Form S-4 (together with any
amendments thereto, the "Registration Statement") under the Securities Act of
1933, as amended (the "Securities Act"), with the Commission covering the
shares of M&I Common Stock to be issued in connection with the Consolidation.
As permitted by the rules and regulations of the Commission, this
Prospectus/Proxy Statement omits certain information, exhibits and
undertakings contained in the Registration Statement, including the exhibits
filed as a part thereof. Statements contained in this Prospectus/Proxy
Statement or in any documents incorporated by reference herein as to the
contents of any contract or other document are not necessarily complete and,
in each instance where such contract or document is an exhibit to the
Registration Statement or an incorporated document, reference is made to the
copy of such contract or document filed as an exhibit to the Registration
Statement or such incorporated document, each such statement being qualified
in all respects by such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by M&I with the Commission pursuant to
the Exchange Act are hereby incorporated by reference in this
Prospectus/Proxy Statement:
(1) M&I's Annual Report on Form 10-K for the year ended December 31,
1993.
(2) M&I's Quarterly Reports on Form 10-Q for the quarters ended March
31, June 30, and September 30, 1994.
(3) M&I's Current Reports on Form 8-K dated February 23, 1994, May
17, 1994, May 31, 1994, and September 26, 1994.
(4) M&I's Report on Form 10-C dated May 31, 1994.
(5) The description of M&I's common stock which is contained in M&I's
registration statement filed pursuant to Section 12(g) of the
Exchange Act, and any amendment or report filed for the purpose
of updating such description.
<PAGE>
All documents filed by M&I pursuant to Section 13(a), 13(c), 14 and
15(d) of the Exchange Act subsequent to the date of this Prospectus/Proxy
Statement and prior to the date of the Special Meeting shall be deemed to be
incorporated by reference into this Prospectus/Proxy Statement from the dates
of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated in this Prospectus/Proxy Statement
shall be deemed to be modified or superseded for purposes of this Prospectus/
Proxy Statement to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be
incorporated by reference modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus/Proxy
Statement.
THIS DOCUMENT INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT
PRESENTED HEREIN OR DELIVERED HEREWITH. COPIES OF THESE DOCUMENTS, OTHER
THAN EXHIBITS THERETO, ARE AVAILABLE WITHOUT CHARGE TO ANY PERSON, INCLUDING
ANY BENEFICIAL OWNER, TO WHOM THIS PROSPECTUS/PROXY STATEMENT IS DELIVERED
UPON WRITTEN OR ORAL REQUEST DIRECTED TO: MR. MICHAEL A. HATFIELD,
SECRETARY, MARSHALL & ILSLEY CORPORATION, 770 NORTH WATER STREET, MILWAUKEE,
WISCONSIN 53202 (TELEPHONE: (414) 765-7801).
IN ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD
BE MADE BY , 1995.
All information contained in this Prospectus/Proxy Statement relating
to M&I has been supplied by M&I and all information relating to Citizens
Bancorp has been supplied by Citizens Bancorp.
<PAGE>
SUMMARY
The following summarizes certain information contained elsewhere herein
or incorporated by reference in this Prospectus/Proxy Statement. The summary
is necessarily incomplete and selective and is qualified in its entirety by
more detailed information contained herein or incorporated herein by
reference, which shareholders are urged to read carefully.
Introduction . . . . . . . This Prospectus/Proxy Statement relates to the
proposed merger of Citizens Bancorp with and
into M&I Interim Corp. ("M&I Interim Corp."), a
wholly-owned subsidiary of M&I, pursuant to the
Agreement and Plan of Reorganization, which is
being submitted to a vote of Citizens Bancorp
shareholders. As a result of the Merger, each
share of Citizens Bancorp Stock (other than
Citizens Bancorp Stock as to which Dissenters'
Rights are exercised) will be converted into
the right to receive 305.85 shares of M&I
Stock.
M&I. . . . . . . . . . . . M&I is a multi-bank holding company registered
under the Bank Holding Company Act of 1956, as
amended (the "BHCA"). As of December 31, 1994,
M&I owned substantially all of the outstanding
capital stock of 34 banks and one savings
association with over 225 offices in Wisconsin
and 12 offices in Arizona. M&I and its
subsidiaries also engage in banking-related
businesses, including trust services,
investment management, commercial leasing,
mortgage banking, investment advice, brokerage
services, data processing and venture capital.
At December 31, 1994, M&I had consolidated
total assets of approximately $12.6 billion.
M&I's principal executive offices are located
at 770 North Water Street, Milwaukee, Wisconsin
53202, and its general telephone number is
(414) 765-7801. For additional information
concerning the business of M&I and its
financial condition, please refer to the M&I
documents incorporated herein by reference.
See "INCORPORATION OF CERTAIN INFORMATION BY
REFERENCE."
M&I Interim Corp.. . . . . M&I Interim Corp. is a wholly-owned subsidiary
of M&I organized solely for the purpose of
effecting the Merger.
Citizens Bancorp . . . . . Citizens Bancorp is a one-bank holding company
which owns 100% of the outstanding shares of
capital stock of the Citizens Bank of Delavan
("Citizens Bank"). At December 31, 1994,
Citizens Bancorp had consolidated total assets
of approximately $98.6 million. Citizens
Bancorp is located at 104 North 5th Street,
P.O. Box 307, Delavan, Wisconsin 53115-1637,
and its general telephone number is (414) 728-
2606. See "CERTAIN INFORMATION CONCERNING
CITIZENS BANCORP."
Time, Place and Date
of the Special Meeting. . A special meeting of the stockholders of
Citizens Bancorp will be held at _____ a.m.
(local time) on ___________, 1995 at the main
office of Citizens Bancorp, 104 North 5th
Street, Delavan, Wisconsin 53115-1637. See
"THE SPECIAL MEETING - General."
<PAGE>
Purpose of the Meeting . . To consider and vote upon the Merger Agreement.
Required Vote. . . . . . . The affirmative vote of the holders of a
majority of the issued and outstanding shares
of Citizens Bancorp Stock is required under the
Wisconsin Business Corporation Law (the "WBCL")
to approve and adopt the Merger Agreement. On
January 31, 1995, there were 3,703 shares of
Citizens Bancorp Stock outstanding, 1,332
shares of which were held by Citizens Bancorp
directors, executive officers and their
affiliates. M&I, the sole shareholder of M&I
Interim Corp., has approved the Merger
Agreement. See "THE SPECIAL MEETING - Record
Dates and Voting Rights."
Recommendation of the Board The Board of Directors of Citizens Bancorp has
determined that the transactions contemplated
by the Merger Agreement are in the best
interests of Citizens Bancorp shareholders and
has recommended that the shareholders approve
and adopt the Merger Agreement. The members of
the Board of Directors of Citizens Bancorp have
indicated that they intend to vote all of their
shares, which represent approximately 36% of
the outstanding shares of Citizens Bancorp
Stock in favor of the Merger Agreement. See
"THE MERGER - Reasons for Approval of the
Merger."
The Merger and the
Exchange Ratio. . . . . . If the Merger is implemented, Citizens Bancorp
will be merged with and into M&I Interim Corp.
At the effective time of the Merger (the
"Effective Time," or if reference is made to
the date on which the Merger is effected, the
"Effective Date"), each share of Citizens
Bancorp Stock outstanding immediately prior to
the Effective Time (exclusive of shares held by
Citizens Bancorp shareholders who have properly
exercised dissenters' rights under the WBCL)
will be converted into the right to receive
305.85 shares of M&I Stock and cash in lieu of
fractional shares. See "THE MERGER - General."
Required Regulatory Approval Before the Merger may be consummated, the
transactions must be approved by the Board of
Governors of the Federal Reserve System (the
"Federal Reserve Board"). See "THE MERGER -
Regulatory Approvals Required."
Conditions to the Merger . Consummation of the Merger is subject to
approval of the Merger Agreement by Citizens
Bancorp's shareholders and a number of other
conditions including, without limitation: (i)
approval by the Federal Reserve Board, (ii) the
absence of any material adverse changes in the
financial condition of Citizens Bancorp, and
(iii) the absence of certain litigation. See
"THE MERGER - Conditions to the Merger."
<PAGE>
Termination of the Merger
Agreement . . . . . . . . The Merger Agreement may be terminated by the
mutual consent of the Boards of Directors of
M&I and Citizens Bancorp, by either Citizens
Bancorp or M&I if the Merger is not consummated
on or before July 1, 1995, by either Citizens
Bancorp or M&I if any conditions precedent to
their respective obligations under the Merger
Agreement have not been met or satisfied, and
by Citizens Bancorp if there has been a
material adverse change in the consolidated
financial condition of M&I from that set forth
in M&I's balance sheet included in its Form
10-K for the year ended December 31, 1993. See
"THE MERGER - Termination and Amendment."
Federal Income Tax
Consequences. . . . . . . The Merger is intended to qualify as a tax-free
reorganization pursuant to Section 368(a)(1)(C)
of the Internal Revenue Code of 1986, as
amended (the "Code"). If the Merger does, in
fact, so qualify, shareholders of Citizens
Bancorp who receive M&I Stock will recognize no
gain or loss on the exchange of their Citizens
Bancorp Stock for M&I Stock except as to cash
received, if any, in lieu of fractional shares.
See "THE MERGER - Certain Federal Income Tax
Consequences."
Dissenters' Rights of
Appraisal . . . . . . . . Holders of Citizens Bancorp Stock who comply
with the procedural requirements of the WBCL
will have appraisal rights in connection with
the Merger ("Dissenters' Rights"). Pursuant to
Section 180.1302(1) of the WBCL, holders of
shares of stock entitled to notice of a
shareholders meeting at which shareholders are
to vote on a merger are provided, subject to
certain procedural requirements, with statutory
rights of appraisal pursuant to which such
shareholders may be entitled to receive cash in
the amount of the "fair value" of their shares
plus accrued interest (as determined pursuant
to Section 180.1325 of the WBCL) instead of the
shares or cash in lieu of fractional shares
offered pursuant to the Merger. See "THE
MERGER - Dissenters' Rights of Appraisal;" and
Appendix B hereto.
<PAGE>
Selected Per Share Data. . The following table presents selected unaudited
historical per share data for M&I and Citizens
Bancorp, selected pro forma per share data for
M&I, and selected pro forma equivalent per
share data for Citizens Bancorp. The terms of
the Merger Agreement provide for holders of
Citizens Bancorp Stock to receive 305.85 shares
of M&I Stock for each share of Citizens Bancorp
Stock. The selected pro forma per share data
assumes 1,132,562 shares of M&I Stock were
exchanged for 3,703 shares of Citizens Bancorp
Stock in a transaction accounted for as a
purchase.
Historical Citizens
---------- Bancorp
Citizens M&I Pro Forma
M&I Bancorp Pro Forma Equivalent(3)
----- --------- ---------- --------------
Operating Income (1) (2)
Year ended December 31, 1994 $ .93 $ 673.54 $ .94 $ 287.50
Cash Dividends
Year ended December 31, 1994 $ .59 $ 146.00 $ .59 $ 180.45
Book Value
As of December 31, 1994 $11.01 $5,421.01 $11.11 $3,397.99
- ---------------
(1) Operating income represents income before extraordinary items.
(2) The pro forma earnings per share computations are based on pro forma
average shares outstanding for the periods presented.
(3) The Citizens Bancorp pro forma equivalent represents the M&I pro forma
amount multiplied by the Exchange Ratio of 305.85.
<PAGE>
Comparative Stock Prices . The following table represents market price per
share data for M&I Stock on September 7, 1994,
the last trading day preceding the public
announcement of the proposed Merger and on
March 1, 1995. There is no
established trading market for Citizens Bancorp
Stock. The price shown below for Citizens
Bancorp Stock is the last known traded price
per share of Citizens Bancorp Stock, which was
traded on May 10, 1994.
Historical
--------------------------- Citizens Bancorp
M&I Citizens Bancorp Equivalent Market
Stock (1) Stock (2) Value Per share (3)
--------- ---------------- --------------------
Market value per share
September 7, 1994 $20.50 $4,109 $6,269.93
March 1, 1995 $20.75 $4,109 $6,346.39
(1) The market value of the M&I Stock is the closing sale price per share
quoted on the NASDAQ/NMS on the dates indicated as reported in the
Midwest Edition of The Wall Street Journal.
(2) This figure represents the last known traded price per share of
Citizens Bancorp Stock which was traded on May 10, 1994. See "CERTAIN
INFORMATION CONCERNING CITIZENS BANCORP - Market Information and
Dividends."
(3) The equivalent market value per share amount represents the closing
sale price of a share of M&I Stock on the date presented multiplied by
the Exchange Ratio of 305.85.
Selected Historical
Financial Information . . The following tables set forth certain
historical consolidated financial information
for M&I and Citizens Bancorp, respectively.
This information is based on the consolidated
financial statements of M&I and Citizens
Bancorp, respectively, including the respective
notes thereto, which are either incorporated by
reference in this Prospectus/Proxy Statement or
included elsewhere herein and should be read in
conjunction therewith.
<PAGE>
MARSHALL & ILSLEY CORPORATION
Selected Historical Financial Information
(In Thousands, Except Per Share Data)
For The Years Ended December 31,
------------------------------------------------------
1994 1993 1992 1991 1990
------ ------ ------ ------ ------
Summarized Consolidated
Income Statement Data(1):
Net interest
income $491,227 $480,279 $472,551 $429,498 $402,461
Provision for
loan losses 24,907 18,034 23,546 28,924 47,639
Other income 361,481 371,926 328,411 276,748 228,601
Other expense 584,770 569,587 545,624 490,584 440,231
Merger /
restructuring 75,228 --- --- --- ---
Operating income(3) 94,398 171,394 156,401 130,013 100,362
Per Share Data(1)(2):
Primary operating
income(3) $.95 $1.67 $1.55 $1.33 $1.03
Fully diluted
operating income(3) .93 1.60 1.48 1.27 1.00
Dividends paid .59 0.54 0.48 0.43 0.39
Selected Average
Balance Sheet Data(1):
Total Assets $12,432,461 $12,039,468 $11,525,409 $11,015,325 $10,426,274
Long-term
borrowings 447,254 272,041 284,333 290,724 236,745
________________
(1) Financial information for periods ended prior to May 31, 1994 has been
restated to give effect to the merger of Valley Bancorporation with and
into M&I on a pooling of interests basis.
(2) M&I's per share data has been retroactively restated for a 3 for 1
stock split in the form of a 200% stock dividend distributed to
shareholders in May, 1993.
(3) Operating income and related earnings per share are before
extraordinary items for the year ended December 31, 1994 and before
cumulative effects of changes in accounting principles for the year
ended December 31, 1992.
<PAGE>
Citizens Bancorp of Delavan, Inc.
Selected Historical Financial Information
(In Thousands, Except Per Share Data)
For The Years Ended December 31,
------------------------------------------
1994 1993 1992 1991 1990
----- ------ ------ ------ ------
Summarized Consolidated
Income Statement Data:
Net interest income $4,635 $4,492 $3,712 $3,576 $3,133
Operating income 2,513 2,437 1,719 2,013 1,692
Per Share Data:
Operating income $673.54 $642.83 $452.84 $519.35 $434.85
Dividends paid 146.00 134.00 126.00 118.00 111.00
Selected Balance
Sheet Data (1):
Total Assets $98,624 $95,375 $87,445 $77,244 $70,564
Long-term borrowings 0 0 0 0 0
________________
(1) Amounts represent period end balances.
<PAGE>
THE SPECIAL MEETING
General
This Prospectus/Proxy Statement is being furnished to shareholders of
Citizens Bancorp in connection with the solicitation of proxies by the Board
of Directors of Citizens Bancorp for use at its Special Meeting, including
any adjournments or postponements thereof. Citizens Bancorp's Special
Meeting will be held on ________________, 1995 at _______ a.m., local time,
at the main office of Citizens Bancorp, 104 North 5th Street, Delavan,
Wisconsin 53115-1637.
Proposals to be Considered
Citizens Bancorp's Special Meeting will be held to consider and vote
upon a proposal to approve the Merger and to transact such other business as
may properly come before Citizens Bancorp's Special Meeting.
Record Dates and Voting Rights
Holders of Citizens Bancorp Stock at the close of business on the
Record Date (_____________, 1995) will be entitled to notice of and to vote
at the Special Meeting. Each share of Citizens Bancorp Stock is entitled to
one vote on each proposal presented. As of the Record Date, 3,703 shares of
Citizens Bancorp Stock were outstanding, of which 1,332 shares or
approximately 36% were held by Citizens Bancorp directors, executive officers
and their affiliates. Directors and executive officers of Citizens Bancorp
have indicated that they intend to vote their shares to approve the Merger.
Shares of Citizens Bancorp Stock representing, as of the Record Date, a
majority of the outstanding shares of Citizens Bancorp Stock must be
represented in person or by proxy at the Special Meeting for a quorum to be
present. In addition, the affirmative vote of the holders of a majority of
the issued and outstanding shares of Citizens Bancorp Stock as of the Record
Date is required to approve the Merger. Abstentions and broker non-votes
will be treated as present for purposes of determining the presence of a
quorum, but have the same effect as a vote against the proposal to approve
the Merger.
Voting; Revocation of Proxies
Shares of Citizens Bancorp Stock represented by a proxy properly signed
and received at or prior to the Special Meeting, unless subsequently revoked,
will be voted in accordance with the instructions thereon. Any proxy may be
revoked by the person giving it at any time prior to the voting of the proxy
by giving written notice to the secretary of Citizens Bancorp, by giving oral
notice to the presiding officer during the Special Meeting that the
shareholder intends to vote in person, or by submitting a subsequently dated
proxy. Attendance by a shareholder at the Special Meeting will not, in and
of itself, constitute revocation of a proxy. If a proxy is signed and
returned without indicating any voting instructions, such proxy will be voted
FOR the proposal to approve the Merger.
Citizens Bancorp's Board of Directors is not aware of any business to
be acted upon at the Special Meeting other than as described herein. If,
however, other matters are properly brought before the Special Meeting, the
persons appointed as proxies will have discretion to vote thereon in
accordance with their best judgment.
<PAGE>
Solicitation of Proxies
The enclosed proxy is being solicited by the Board of Directors of
Citizens Bancorp for use in connection with the Special Meeting. Citizens
Bancorp will bear its own expenses in connection with the Special Meeting.
In addition to solicitation of proxies by mail, directors, officers and
employees of Citizens Bancorp may make solicitation of proxies for the
Special Meeting either personally or by telephone, telegram or other forms of
communication. Such directors, officers and employees will receive no
special compensation for any solicitation. Brokerage houses, nominees,
fiduciaries and other custodians will be requested to forward soliciting
materials to beneficial owners and will be reimbursed for their customary
charges and expenses.
CITIZENS BANCORP SHAREHOLDERS SHOULD NOT SEND STOCK CERTIFICATES WITH
THEIR PROXY.
THE MERGER
The following information with respect to the Agreement and Plan of
Reorganization, as amended, and the related Agreement and Plan of Merger
(collectively referred to as the "Merger Agreement"), does not purport to be
complete and is qualified in its entirety by reference to the Merger
Agreement, which is attached hereto as Appendix A and incorporated herein by
reference. All shareholders of Citizens Bancorp are urged to read the Merger
Agreement in its entirety. The Merger Agreement is being presented to
Citizens Bancorp's shareholders as a single, unified proposal, encompassing
all of the elements relating to the acquisition of Citizens Bancorp by M&I as
hereinafter described. APPROVAL OF THE MERGER AGREEMENT WILL CONSTITUTE
APPROVAL OF EACH OF SUCH ELEMENTS, INCLUDING THE MERGER.
General
The Merger Agreement provides that, subject to the requisite approval
of the shareholders of M&I Interim Corp. and Citizens Bancorp, the Federal
Reserve Board and any other necessary government authorities or third parties
and to the satisfaction or waiver of certain other conditions, Citizens
Bancorp will be merged with and into M&I Interim Corp. and M&I Interim Corp.
will be the surviving corporation (the "Surviving Corporation"), after which
Citizens Bancorp will cease to exist (the "Merger").
On the Effective Date of the Merger (as defined below), in accordance
with the terms of the Merger Agreement, each outstanding share of Citizens
Bancorp Stock (other than "Dissenting Shares," defined below) will be
converted into the right to receive 305.85 shares of M&I Stock and cash in
lieu of fractional shares. Shares of M&I Stock and shares of the common
stock of M&I Interim Corp. outstanding on the Effective Date will not be
changed, cancelled, modified or converted as a result of the Merger. Thus,
as a result of the Merger, M&I Interim Corp. will succeed to the assets and
liabilities of Citizens Bancorp and M&I Interim Corp. will remain a wholly-
owned subsidiary of M&I. Immediately following the Effective Date, M&I
Interim Corp. will then be liquidated into M&I by means of an upstream merger
and, as a result, Citizens Bank of Delavan ("Citizens Bank"), which, prior to
the Effective Date was a wholly-owned subsidiary of Citizens Bancorp, will
become a wholly-owned subsidiary of M&I.
Once Citizens Bank becomes a wholly-owned subsidiary of M&I, it is the
intention of M&I to consolidate Sharon State Bank ("Sharon Bank"), a
Wisconsin state bank, with and into Citizens Bank, with Citizens Bank being
the surviving bank (the "Consolidation").
Effective Date
The Merger will become effective as promptly as practicable within the
thirty-day period commencing with the latest of the following dates: (i) the
30th calendar day after the date of approval by the Federal Reserve Board;
(ii) such date as may be prescribed by the Wisconsin Commissioner of Banking,
or any other agency or authority from which approval must be received prior
to the consummation of the Merger; (iii) if the Merger is being contested in
any legal proceeding, and M&I has elected to contest the same, then the date
that such legal proceeding has been brought to a conclusion favorable, in the
judgment of M&I, to the consummation of the Merger (the "Effective Date").
See "- Regulatory Approvals Required." The Merger Agreement may be
terminated by either party if, among other reasons, the Merger has not been
consummated on or before July 1, 1995. See "- Termination and Amendment."
<PAGE>
Background of the Merger
For many years, Citizens Bancorp and Sharon Bank have been managed by
Mr. Rymund Wurlitzer and members of his family. Mr. Wurlitzer and his family
are substantial stockholders of both Citizens Bancorp and Sharon Bank. See
"CERTAIN INFORMATION CONCERNING CITIZENS BANCORP - Share Ownership."
Citizens Bancorp and Sharon Bank also have many of the same directors and
shareholders. They are not, however, under the common control of a single
corporation.
In April 1994, Mr. Wurlitzer, in consultation with the Citizens Bancorp
Board of Directors, determined that an orderly management succession for
Citizens Bancorp and Sharon Bank would be best served by joining both
institutions with a larger bank holding company. In furtherance of this
determination, Mr. Wurlitzer contacted Mr. J. B. Wigdale, Chairman of the
Board and Chief Executive Officer of M&I in May 1994 concerning a possible
business combination between Citizens Bancorp, Sharon Bank and M&I. Mr.
Wurlitzer and officers and representatives of M&I negotiated a possible
business combination between the organizations during the summer of 1994,
which negotiations culminated in the Merger Agreement. On August 29, 1994,
the Board of Directors of Citizens Bancorp approved the Merger Agreement.
Reasons For Approval of the Merger
The Board of Directors of Citizens Bancorp has approved the Merger
Agreement and believes that the proposed Merger is in the best interests of
Citizens Bancorp's shareholders. Accordingly, the Board of Directors
recommends that the shareholders of Citizens Bancorp vote in favor of
adoption of the Merger Agreement for the following reasons:
(1) The Merger will provide Citizens Bancorp with management
resources for current and future operations.
(2) Affiliation with M&I will provide Citizens Bancorp's shareholders
with ownership of a company with geographically diverse
operations, diminishing the risk of erosion of franchise value
that ownership of a local community bank stock entails.
(3) Holders of Citizens Bancorp Stock will receive M&I Stock, which
unlike Citizens Bancorp Stock, has an active trading market.
(4) The Board of Directors of Citizens Bancorp believes that M&I is a
dynamic organization which has shown consistent growth in
earnings and assets in recent years.
(5) Affiliation with another bank holding company provides an
opportunity to realize economies of scale and increased
efficiencies of operation, to the benefit of shareholders and
customers.
(6) Affiliation with M&I will also permit or enhance the development
of new products and services for bank customers.
(7) The Board of Directors believes that an affiliation with a
holding company such as M&I which emphasizes local autonomy is in
the best interest of shareholders, as it enhances bank customer
relationships and opportunities.
<PAGE>
Merger Consideration
On the Effective Date, without any action on the part of any holder of
shares of Citizens Bancorp Stock, each share of Citizens Bancorp Stock issued
and outstanding immediately prior to the Effective Date will, pursuant to the
Merger Agreement, be converted into the right to receive 305.85 shares (the
"Exchange Ratio") of M&I Stock. The Exchange Ratio is subject to adjustment
in the event of an M&I stock split, stock dividend or other similar
transaction between the date of the Merger Agreement and the Effective Date.
Not included in this conversion is Citizens Bancorp Stock owned by
shareholders who have perfected dissenters' rights (the "Dissenting Shares"
and "Dissenting Shareholders"), whose shares shall be cancelled upon cash
payment to each such shareholder in accordance with the provisions of Section
180.1325 of the Wisconsin Statutes. For a description of the M&I Stock to be
received in connection with the Merger, see "INCORPORATION OF CERTAIN
INFORMATION BY REFERENCE" and for a description of certain differences in the
rights of shareholders of M&I and Citizens Bancorp, see "COMPARISON OF
SHAREHOLDER RIGHTS." No fractional shares of M&I Stock will be issued in the
Merger. Instead, each shareholder who would otherwise be entitled to receive
a fractional share of M&I Stock will be paid cash equal to such fraction
multiplied by the closing sales price of M&I Stock as reported in the Midwest
Edition of the Wall Street Journal on the Effective Date. See "- Conversion
of Shares; Exchange of Certificates; No Fractional Shares."
Shares of common stock of M&I Interim Corp. issued and outstanding as
of the Effective Date will remain outstanding, be owned by M&I, and not
changed or converted by the Merger.
Conversion of Shares; Exchange of Certificates; No Fractional Shares
On the Effective Date, by virtue of the Merger and without any action
on the part of M&I, Citizens Bancorp, or the holders of Citizens Bancorp
Stock, each share of Citizens Bancorp Stock issued and outstanding
immediately prior to the Effective Date will be converted into the right to
receive 305.85 shares of M&I Stock (excluding Citizens Bancorp Stock owned by
Dissenting Shareholders). All such shares of Citizens Bancorp Stock will no
longer be outstanding and will automatically be cancelled and retired and
will cease to exist, and each certificate previously representing any such
shares of Citizens Bancorp Stock will thereafter represent the right to
receive a certificate representing shares of M&I Stock into which such
Citizens Bancorp Stock is convertible. Certificates previously representing
shares of Citizens Bancorp Stock will be exchanged for certificates
representing whole shares of M&I Stock upon the surrender of such
certificates as provided below, without interest. No fractional share of M&I
Stock will be issued, and, in lieu thereof, a cash payment will be made as
provided below.
As soon as practicable after the Effective Date, M&I will deposit, or
cause to be deposited, with a bank or trust company designated by M&I (the
"Exchange Agent") certificates representing the shares of M&I Stock issuable
pursuant to the terms of the Merger Agreement to former holders of Citizens
Bancorp Stock on the Effective Date. M&I will also deposit with the Exchange
Agent cash to be used for payment to holders of fractional shares. As soon
as reasonably practicable after the Effective Date, the Exchange Agent will
mail to each holder of record of a certificate or certificates which
immediately prior to the Effective Date represented outstanding shares of
Citizens Bancorp Stock (the "Certificates"), whose shares of Citizens Bancorp
Stock were converted into the right to receive shares of M&I Stock, (i) a
notice in transmittal form and (ii) instructions for use in effecting the
surrender of the Certificates in exchange for certificates representing
shares of M&I Stock. Upon surrender of a Certificate for cancellation to the
Exchange Agent together with a properly executed letter of transmittal, the
holder of such Certificate will receive a certificate representing that
number of whole shares of M&I Stock which such holder has the right to
receive in respect of the Certificate surrendered (after taking into account
all shares then held by such holder) and cash in lieu of any fractional
shares, and the Certificate so surrendered will be cancelled. In the event
of a transfer of ownership of shares of Citizens Bancorp Stock which is not
registered in the transfer records of Citizens Bancorp, a certificate
representing the proper number of shares of M&I Stock may be issued to a
transferee if the Certificate representing such shares of Citizens Bancorp
Stock is presented to the Surviving Corporation. A certificate evidencing
shares of M&I Stock in a name other than that in which the Certificate
<PAGE>
surrendered and exchanged is registered may be issued if the Certificate so
surrendered is properly endorsed, with signatures guaranteed by a commercial
bank or a firm having membership on a national securities exchange, or
otherwise in proper form for transfer, and the person requesting such
exchange shall pay to the Exchange Agent any transfer or other taxes required
by reason of the issuance of its certificate for shares of M&I Stock to any
person other than the registered holder of the Certificate surrendered.
Until surrendered, each Certificate will, after the Effective Date, represent
only the right to receive upon such surrender a certificate representing
shares of M&I Stock and cash in lieu of any fractional share of M&I Stock as
described below.
CITIZENS BANCORP SHAREHOLDERS SHOULD NOT FORWARD THEIR STOCK
CERTIFICATES TO THE EXCHANGE AGENT UNTIL THEY RECEIVE A TRANSMITTAL FORM AND
INSTRUCTIONS.
No dividends or other distributions declared, made or with a record
date after the Effective Date with respect to M&I Stock will be paid to the
holder of any unsurrendered Certificate with respect to the shares of M&I
Stock represented thereby, and no cash payment in lieu of fractional shares
will be paid to any such holder, until the holder of such Certificate
surrenders such Certificate. Subject to the effect of applicable laws,
following surrender of any such Certificate, there will be paid to the holder
of the certificates representing whole shares of M&I Stock issued in exchange
therefor, without interest, (i) promptly, the amount of any cash payable with
respect to a fractional share of M&I Stock to which such holder is entitled
and the amount of dividends or other distributions with a record date after
the Effective Date previously paid with respect to such whole shares of M&I
Stock, and (ii) at the appropriate payment date, the amount of dividends or
other distributions, with a record date after the Effective Date but prior to
surrender and a payment date occurring after surrender, payable with respect
to such whole shares of M&I Stock.
No certificates or scrip representing fractional shares of M&I Stock
will be issued upon the surrender for exchange of Certificates, no dividend
or distribution with respect to M&I Stock will be payable on or with respect
to any fractional share and such fractional share's interest will not entitle
the owner thereof to vote or to claim any rights of a shareholder of M&I.
Each holder of a fractional share interest will be paid an amount in cash
equal to the product obtained by multiplying such fractional share interest
to which such holder (after taking into account all fractional share
interests then held by such holder) would otherwise be entitled by the
closing price for a share of M&I Stock as reported in the Midwest Edition of
the Wall Street Journal on the Effective Date.
Neither the Exchange Agent nor any person, firm or entity shall be
liable to any former holder of shares of Citizens Bancorp Stock with respect
to any M&I Stock, or dividends thereon, or with respect to any cash to which
any shareholder would be entitled as a consequence of the Merger, if such M&I
Stock, dividends or cash have been paid, or are payable, to any public
official pursuant to any abandoned property, escheat or similar laws.
On the Effective Date, the stock transfer books of Citizens Bancorp
shall be closed and there shall be no further registration of transfers of
shares of Citizens Bancorp Stock thereafter on the records of Citizens
Bancorp. From and after the Effective Date, the holders of certificates
evidencing ownership of shares of Citizens Bancorp Stock outstanding
immediately prior to the Effective Date shall cease to have any rights with
respect to such shares except as otherwise provided in the Merger Agreement
or by law. On or after the Effective Date, any Certificates presented to the
Exchange Agent or M&I for any reason shall be converted into shares of M&I
Stock in accordance with the terms of the Merger Agreement as described
above.
Representations and Warranties
The Merger Agreement contains certain customary representations and
warranties of each of M&I and Citizens Bancorp (and in certain cases also
relating to their respective subsidiaries) relating to, among other things,
(a) organization; (b) capital structures; (c) authorization, execution,
delivery, performance and enforceability of the Merger Agreement and other
related matters;
<PAGE>
(d) the absence of material pending or threatened litigation or governmental
investigations or agreements except as otherwise disclosed in the Merger
Agreement; and (e) full disclosure with regard to all written information
furnished pursuant to the Merger Agreement.
With respect to Citizens Bancorp only (and in certain cases, its
subsidiary), representations and warranties are contained in the Merger
Agreement relating to (a) delivery to M&I of correct and complete copies of
Citizens Bancorp's financial statements; (b) reserves for possible loan and
lease losses; (c) the absence of certain material changes or events since
January 1, 1994, including changes or events relating to the incurrence of a
material adverse effect in the business, properties or financial condition of
Citizens Bancorp, except as otherwise disclosed in the Merger Agreement; (d)
good title to all assets and properties, free of liens, except as specified;
(e) compliance with laws; (f) certain tax matters; (g) certain matters
relating to employment contracts and benefits; (h) material contracts; (i)
retirement and other employee plans and matters relating to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"); (j) certain
matters relating to the conduct of Citizens Bancorp since December 31, 1993;
(k) Citizens Bancorp's approval of the Merger Agreement and its
recommendation to Citizens Bancorp shareholders to authorize and approve the
Merger Agreement; (l) certain insurance matters; (m) the absence of any
adverse contracts, agreements or restrictions; (n) Citizens Bancorp's loan
schedule; and (o) the absence of certain environmental matters, except as
disclosed in the Merger Agreement.
With respect to M&I only, representation and warranties are contained
in the Merger Agreement which relate to documents filed with the Securities
and Exchange Commission (the "Commission") and the accuracy of the
information contained therein.
Additional Covenants and Agreements
Pursuant to the Merger Agreement, Citizens Bancorp has agreed that
prior to the Effective Date, Citizens Bancorp and its subsidiary will (a)
carry on their businesses diligently and consistent with past practice; (b)
maintain and keep their properties in as good repair and condition as at
present, except for depreciation due to ordinary wear and tear and damage due
to casualty; (c) maintain insurance comparable in amount and in scope of
coverage to that now maintained by them; (d) perform all of their obligations
under contracts, leases and documents relating to or affecting their assets,
properties and businesses; (e) maintain and preserve their business
organizations intact, retain their present employees and maintain their
relationships with customers; and (f) comply with and perform all obligations
and duties imposed upon them by federal and state laws and all rules,
regulations and orders imposed by federal or state governmental authorities.
Citizens Bancorp has also agreed that prior to the Effective Date
(unless the prior written consent of M&I shall have been obtained), neither
Citizens Bancorp nor its subsidiary will: (a) (i) incur or assume any
material obligation or liability, including without limitation any obligation
for borrowed money whether or not evidenced by a note, bond, debenture or
similar instrument, (ii) assume, guaranty, endorse or otherwise become liable
or responsible (whether directly, contingent or otherwise) for the
obligations of any other person; or (iii) mortgage, license, pledge or grant
a security interest in any of its material assets or allow to exist any
material lien thereon; except (A) for liabilities and obligations (including
corporate debt issuances) incurred in the ordinary course of business
consistent with past practice and in amounts not material to Citizens
Bancorp; or undertaken in connection with the capital expenditures otherwise
permitted under this section; and (B) as may be required under existing
agreements to which Citizens Bancorp or its subsidiary are parties; (b)
change its lending, investment, liability management and other material
banking policies in any material respect; organize any subsidiaries or enter
into any new non-banking line of business whether or not permissible under
applicable federal or state law, make any material changes in its operations
or make any material investment in any other person, firm or entity; (c)
propose, adopt or permit any amendment to its Articles of Incorporation or
By-Laws or the terms of any securities issued by it; (d) in an aggregate
amount exceeding $100,000 authorize, incur or commit to any capital
expenditures other than capital expenditures consistent with the budget
heretofore furnished to and approved by M&I; (e) (i) split, combine or
reclassify any Citizens Bancorp Stock or redeem, purchase or otherwise
acquire any shares of its capital stock or any securities or obligations
convertible into or exchangeable for any shares of its capital stock, or any
options, warrants, conversion or rights to acquire any shares of its capital
stock or any securities or obligations;
<PAGE>
(ii) merge with or into any other corporation or bank, permit any other
corporation or bank to merge into it or consolidate with any other
corporation or bank, or effect any reorganization or recapitalization; (iii)
purchase or otherwise acquire any substantial portion of the assets, or more
than 5% of any class of capital stock, of any corporation, bank or other
business; and (iv) liquidate, sell, dispose of, or encumber any assets other
than in the ordinary course of business consistent with past practice which
assets are not material to Citizens Bancorp; (f) revalue in any material
respect any of its assets, including without limitation the writing down or
writing off the value of any asset; or change its methods of accounting,
except as required by changes in generally accepted accounting principles as
concurred in by Arthur Andersen LLP, or change any of its methods of
reporting income and deductions for Federal income tax purposes, except as
required by changes in applicable law; (g) make any tax election or settle or
compromise any income tax liability material to Citizens Bancorp or its
subsidiary; (h) pay, discharge or satisfy any claims, liabilities or
obligations (absolute, accrued, asserted or unasserted, contingent or
otherwise), other than the payment, discharge or satisfaction in the ordinary
course of business of liabilities reflected or reserved against in, or
contemplated by, the consolidated financial statements (or the note thereto)
of Citizens Bancorp or incurred in the ordinary course of business consistent
with past practice; (i) (i) issue, grant, sell or pledge any shares of its
capital stock or any securities convertible into capital stock, or permit any
shares of its capital stock held in its treasury to become outstanding,
except upon exercise of rights or options outstanding under employee benefit
plans, programs or arrangements in existence on the date hereof; (ii) confer,
issue, sell, grant or award any options, warrants, conversion or other rights
not outstanding on the date hereof to acquire any shares of its capital stock
not outstanding on the date hereof, including without limitation, the issue,
sale, or grant of any option or stock appreciation right; or (iii) amend any
of the terms of any such outstanding securities, options, warrants, rights or
agreements; (j) take or suffer to exist any of the actions described in
Section 3.13 of the Merger Agreement (relating to the conduct of Citizens
Bancorp and its subsidiary since December 31, 1993); (k) (i) enter into or
adopt any new employee benefit plan or agreement, or (except as required
under existing plans or agreements) increase in any manner the compensation
or benefits of any of its officers, directors or other employees; (ii) pay or
agree to pay any pension, retirement or severance allowance or other employee
benefit not required or permitted by any existing plan, agreement or
arrangement to any director, officer or key employee; (iii) adopt or commit
itself to any additional pension, profit sharing, bonus, incentive, deferred
compensation, insurance, or other employee benefit plan, agreement or
arrangement or to any employment or consulting agreement with or for the
benefit of any director, officer or employee except for bonus payments to
employees payable in December of 1994 not to exceed $100,000 in aggregate;
(iv) amend any such plan, agreement or arrangement; or (v) enter into any
contract, agreement or commitment to do any of the foregoing; or (l) declare
or pay any dividends on its outstanding shares of capital stock, except for
regular dividends paid in the ordinary course of business and consistent with
past practices of Citizens Bancorp.
In addition to the foregoing, Citizens Bancorp has covenanted to (a)
provide M&I with certain financial statements as well as information required
for inclusion in the Registration Statement, (b) promptly (i) take all
necessary steps to hold a meeting of its shareholders for the purpose of
voting on the Merger Agreement; (ii) include in the Prospectus/Proxy
Statement the recommendation of Citizens Bancorp's Board of Directors that
Citizens Bancorp's shareholders vote in favor of the Merger Agreement; and
(iii) use its best efforts to furnish the information required to be included
by it in the Prospectus/Proxy Statement, cause such to be mailed to its
shareholders in a timely manner and obtain the necessary approvals by the
requisite percentage of its shareholders of the Merger Agreement; (c) afford
to the officers, attorneys, accountants and other authorized representatives
of M&I full and free access to the properties, books, contracts, commitments
and records of Citizens Bancorp and its subsidiary; (d) consult with and
provide notice to the officers of M&I with respect to certain actions and
proceedings; and (e) identify all known "affiliates" and require each to
execute an agreement (the "Affiliate Agreement") restricting the transfer of
the M&I stock received by each in the Merger.
M&I has also agreed to perform certain tasks in connection with the
Merger Agreement. Specifically, M&I will (a) file the Registration Statement
with the Commission as soon as practicable after receiving from Citizens
Bancorp all the necessary information regarding Citizens Bancorp and its
subsidiary, and comply with all appropriate state securities laws in
connection with the Merger Agreement;
<PAGE>
(b) file with the Federal Reserve Board and other appropriate state and
federal banking regulatory agencies, an application to complete the Merger
and (c) promptly cause M&I Interim Corp. to be organized under the laws of
the State of Wisconsin, following which M&I will secure approval of the
Merger by the Board of Directors of M&I Interim Corp.
Furthermore, both M&I and Citizens Bancorp agree to (a) use their
reasonable best efforts to consummate the transactions contemplated by the
Merger Agreement and (b) certain restrictions relating to the issuance of
public statements regarding the transactions contemplated by the Merger
Agreement.
No Solicitation of Transactions
The Merger Agreement provides that neither Citizens Bancorp, its
subsidiary nor any of their officers, directors, employees, agents or
representatives will, directly or indirectly, without the prior written
consent of M&I, initiate contact with, solicit or encourage any inquiries or
proposals by or except as, in the written opinion of Citizens Bancorp's
counsel, may be required by the fiduciary duties of the Board of Directors of
Citizens Bancorp, enter into any discussions or agreements with, or disclose
directly or indirectly any information not customarily disclosed concerning
its business and properties, or afford any access to its properties, books
and records to any corporation, partnership, person or other entity or group
in connection with any possible proposal regarding a tender offer for or sale
of Citizens Bancorp's or its subsidiary's capital stock or a consolidation,
merger or sale of all or a substantial portion of the assets of Citizens
Bancorp or its subsidiary or any similar transaction.
Conditions to the Merger
The Merger Agreement contains certain conditions to the respective
obligations of M&I and Citizens Bancorp to consummate the Merger. In
addition to other customary closing conditions, the following conditions are
contained in the Merger Agreement: (a) M&I's and Citizens Bancorp's
representations and warranties contained in the Merger Agreement shall be
true and correct in all material respects; (b) all agreements and covenants
of each of M&I and Citizens Bancorp required to be performed by it under the
Merger Agreement shall have been performed by it in all material respects;
(c) the holders of no more than 5% of the shares of Citizens Bancorp Stock
shall, on the Effective Date, be entitled to assert statutory dissenters'
appraisal rights under Section 180.1302(1) of the Wisconsin Statutes (with
respect to the Merger) (d) M&I and Citizens Bancorp shall have received
Affiliate Agreements executed by Citizens Bancorp shareholders who have been
identified by Citizens Bancorp to be "affiliates;" (e) the parties hereto
shall have received final approval of the transactions contemplated by the
Merger Agreement from all appropriate government agencies and authorities
without any condition which is not satisfactory to M&I, all conditions
required to be satisfied prior to the Effective Date imposed by the terms of
such approvals shall have been satisfied, and all waiting periods relating to
such approvals shall have expired; (f) the Registration Statement shall be
effective under the 1933 Act prior to the Effective Date (and no stop order
suspending the effectiveness thereof shall have been issued during such
period and no proceedings for that purpose shall have been instituted or be
pending on the Effective Date) and all appropriate registrations, permits and
consents required by any state securities law (or exemptions therefrom) in
connection with the Merger Agreement shall have been obtained and be in
effect on the Effective Date; (g) on the Effective Date there shall not be
any litigation, investigation, inquiry or proceeding pending or threatened in
or by any court or government agency or authority which might result in an
action to restrain, enjoin or prohibit consummation of the transactions
contemplated by the Merger Agreement, or which might result in divestiture,
rescission or damages in connection with such transactions or involving any
of the assets, properties, business or operations of Citizens Bancorp or its
subsidiary which might result in any material adverse change in the financial
condition, results of operations, business or prospects of Citizens Bancorp;
and (h) all actions, proceedings, instruments and documents required to carry
out the transaction contemplated by the Merger Agreement and all other
related legal matters (including but not limited to all matters relating to
the federal income tax consequences of the Merger) shall have been
satisfactory to and approved by counsel to each of the parties to the Merger
Agreement.
<PAGE>
In addition to the mutual conditions discussed above, M&I's obligation
to consummate the Merger is subject to the following additional conditions:
(a) the Merger shall have been approved by the requisite percentage of the
outstanding shares of Citizens Bancorp Stock; (b) M&I shall have received
from the President of Citizens Bancorp a certificate attesting to the truth
and accuracy of the information set forth in the Registration Statement
relating to Citizens Bancorp; (c) Citizens Bancorp shall have delivered to
M&I the Affiliate Agreements of those persons deemed to be "affiliates" of
Citizens Bancorp by M&I counsel; (d) Citizens Bancorp shall have provided M&I
with statements of its subsidiary's Net Earnings as of certain specified
dates and such shall not be less than $2,000,000 for any of the specified
periods; (e) the total shareholders' equity of Citizens Bancorp's subsidiary
as of the end of the month last preceding the Effective Date shall not be
less than $17,300,000, excluding adjustments; (f) the absence of certain
material adverse changes in the financial condition of Citizens Bancorp or
its subsidiary; (g) the absence of acceleration of any debt, as a result of
the Merger, owed by Citizens Bancorp or its subsidiary, excluding that which
M&I has been previously notified of; (h) Citizens Bancorp or its subsidiary
shall make such adjustments to accounting and income tax provisions as M&I
shall deem appropriate; and (i) on the Effective Date, Citizens Bancorp will
have no liabilities.
Termination and Amendment
The Merger Agreement may be terminated at any time prior to Effective
Date, whether before or after approval of the matters presented in connection
with the Merger by the shareholders of Citizens Bancorp and/or M&I Interim
Corp.: (a) by mutual consent of the Boards of Directors of Citizens Bancorp
and M&I; (b) by either Citizens Bancorp or M&I if the Merger is not
consummated on or before July 1, 1995; (c) by M&I only if any of the
conditions to the obligation of M&I to consummate the Merger have not been
met or waived; (d) by Citizens Bancorp only if any of the conditions to the
obligation of the Merger have not been met or waived; or (e) by Citizens
Bancorp only if there shall be a material adverse change in the consolidated
financial condition of M&I from that set forth in M&I's balance sheet
included in its Form 10-K for the year ended December 31, 1993.
Subject to applicable law, the Merger Agreement may be amended at any
time before or after the approval of the Merger by the shareholders of
Citizens Bancorp by written agreement of Citizens Bancorp and M&I, except
that after such approval of the shareholders of Citizens Bancorp, no such
amendment, modification or supplement shall reduce or change the form of the
consideration into which each share of Citizens Bancorp Stock will be
converted pursuant to the terms of the Merger Agreement or change any of the
terms and conditions of the Merger Agreement in a manner which materially and
adversely affects the rights of Citizens Bancorp's shareholders without the
approval of such shareholders.
Accounting Treatment
The Merger will be accounted for by M&I under the purchase method of
accounting in accordance with Accounting Principles Board Opinion No. 16,
"Business Combinations," as amended. Under this method of accounting, the
purchase price will be allocated to assets acquired and liabilities assumed
based on their estimated fair values, and the applicable income tax effects,
on the Effective Date. Income of the combined company will not include
income (or loss) of Citizens Bancorp prior to the Effective Date.
Certain Federal Income Tax Consequences
The following is a summary of certain material federal income tax
consequences of the Merger. The summary is provided for general
informational purposes only and does not include consequences of foreign,
state, local or other tax laws. Because each Citizens Bancorp shareholder's
tax circumstances may differ, each Citizens Bancorp shareholder should
consult such shareholder's personal tax advisor as to the tax consequences of
the Merger under federal, state, local or other applicable laws.
The Merger of Citizens Bancorp with and into M&I Interim Corp. to form
the Surviving Corporation, followed by the liquidation by upstream merger of
the Surviving Corporation into M&I, is intended to qualify as a tax-free
<PAGE>
reorganization pursuant to Section 368(a)(1)(C) of the Internal Revenue Code
of 1986, as amended (the "Code"). If the Merger does, in fact, so qualify,
the following will occur: (a) no gain or loss will be recognized by M&I, M&I
Interim Corp. or Citizens Bancorp as a result of the Merger, (b) for those
Citizens Bancorp shareholders who receive solely M&I Stock in exchange for
their Citizens Bancorp Stock, no gain or loss will be recognized on such
exchange except as to any cash received in lieu of fractional shares, (c) the
tax basis of the shares of M&I Stock received by shareholders of Citizens
Bancorp will be the same as the tax basis of their converted Citizens Bancorp
Stock, reduced by any amount allocable to any fractional share interest for
which cash is received, (d) for those Citizens Bancorp shareholders who
receive solely cash in exchange for their Citizens Bancorp stock through
exercise of dissenter's rights, the receipt of cash in exchange for such
stock will be treated as a distribution in redemption of the stock by
Citizens Bancorp subject to the provisions and limitations of Section 302 of
the Code, (e) the holding period of the shares of M&I Stock received by
Citizens Bancorp shareholders in the Merger will include the holding period
of the shares of Citizens Bancorp Stock surrendered in exchange therefor,
provided the Citizens Bancorp Stock is held as a capital asset on the date of
the exchange, and (f) the payment of cash in lieu of fractional share
interests of M&I Stock will be treated as if the fractional shares were
distributed as part of the exchange and then were redeemed by M&I subject to
the provisions and limitations of Section 302 of the Code.
Resale of M&I Stock by Affiliates
The shares of M&I Stock to be issued to former shareholders of Citizens
Bancorp upon consummation of the Merger have been registered under the
Securities Act. Such shares may be traded freely and without restriction by
those shareholders not deemed to be "affiliates," as such term in defined
under the Securities Act, of Citizens Bancorp. "Affiliates" are generally
defined as persons who control, are controlled by, or are under common
control with Citizens Bancorp. Accordingly, "affiliates" will generally
include directors and executive officers of Citizens Bancorp. Shares of M&I
Stock received by those shareholders of Citizens Bancorp deemed to be
"affiliates" may not be sold without registration, except as permitted by
Rule 145 under the Securities Act, or as otherwise permitted under the
Securities Act. This Prospectus/Proxy Statement does not cover resales of
any M&I Stock received by "affiliates" of Citizens Bancorp. Citizens Bancorp
has agreed to use reasonable efforts to cause each person identified as an
affiliate of Citizens Bancorp to enter into an agreement which provides that
such affiliate will not dispose of any M&I Common Stock received in the
Merger except in compliance with the Securities Act or except in a
transaction which, in the opinion of legal counsel reasonably satisfactory to
M&I, is exempt from registration under the Securities Act.
Dissenters' Rights of Appraisal
Under the provisions of Section 180.1302(1) of the Wisconsin Business
Corporation Law (the "WBCL"), a copy of which is attached to this Prospectus/
Proxy Statement as Appendix B, any holder of record or beneficial holder of
Citizens Bancorp Stock has the right to dissent from the Merger and demand
payment of the "fair value" of his or her shares in cash as determined
pursuant to Section 180.1325 of the WBCL ("Dissenters' Rights"). Any
shareholder who wishes to assert Dissenters' Rights must deliver a written
notice of his or her intent to exercise such rights to Citizens Bancorp of
Delavan, Inc., 104 North 5th Street, Delavan, Wisconsin 53115, Attention:
Rymund P. Wurlitzer before the vote on the Merger Agreement is taken at the
Special Meeting. A PROXY OR VOTE AGAINST THE MERGER AGREEMENT WILL NOT, BY
ITSELF, BE REGARDED AS A WRITTEN NOTICE OF INTENT TO DEMAND PAYMENT FOR
PURPOSES OF ASSERTING DISSENTERS' RIGHTS.
A record holder of Citizens Bancorp Stock may assert Dissenters' Rights
as to fewer than all of the shares registered in that shareholder's name only
if the shareholder dissents with respect to all shares beneficially owned by
any one person and notifies Citizens Bancorp in writing of the name and
address of each person on whose behalf the shareholder asserts such
Dissenters' Rights.
A beneficial shareholder may assert Dissenters' Rights as to shares
held on the shareholder's behalf only if, in addition to meeting the other
requirements to dissent, the beneficial shareholder
<PAGE>
(i) submits to Citizens Bancorp the record shareholder's written consent to
the dissent not later than the time that the beneficial shareholder asserts
Dissenters' Rights and (ii) asserts Dissenters' Rights with respect to all
shares of which the shareholder is the beneficial shareholder or over which
the beneficial shareholder has power to direct the vote.
If the Merger Agreement is approved by the requisite vote of holders of
Citizens Bancorp Stock, Citizens Bancorp is required to send a notice (the
"Dissenters' Notice") to all dissenting shareholders of Citizens Bancorp
Stock containing payment demand and stock certificate surrender information
(the "Payment Demand") within 10 days after such approval. The return date
(the "Payment Demand Date") specified by Citizens Bancorp for receiving the
Payment Demand from dissenting shareholders may not be less than 30 nor more
than 60 days after the date on which the Dissenters' Notice was first sent.
Upon receipt of the Dissenters' Notice, each dissenting shareholder must
return his Payment Demand and certificate(s) representing Citizens Bancorp
Stock no later than the Payment Demand Date as provided in the Dissenters'
Notice and certify whether he or she acquired beneficial ownership of the
shares prior to the first public announcement of the terms of the Merger on
September 8, 1994. A Payment Demand may not be withdrawn without Citizens
Bancorp's consent.
Upon effecting the Merger, within 60 days after the Payment Demand
Date, Citizens Bancorp will pay each dissenting shareholder who has properly
perfected Dissenters' Rights as noted above, the amount that Citizens Bancorp
estimates to be the fair value of such dissenting shareholder's shares, plus
accrued interest from the Merger Effective Date; provided that, with respect
to shares acquired after the first public announcement of the Merger,
Citizens Bancorp may elect to withhold payment until either such shareholder
accepts Citizens Bancorp's offer of fair value or a court determines the fair
value of such shares.
If the Merger is not effected within 60 days of the Payment Demand
Date, Citizens Bancorp will return all deposited certificates to dissenting
shareholders. If the Merger is thereafter effected, Citizens Bancorp will
send a new Dissenters' Notice within 10 days of effecting the Merger and
repeat the payment demand procedure described above.
If any dissenting shareholder is dissatisfied with Citizens Bancorp's
determination of "fair value," such dissenting shareholder may notify
Citizens Bancorp in writing of his or her own estimate of the fair value of
his or her shares and the amount of interest due. A dissenting shareholder
must assert this right within 30 days after Citizens Bancorp makes or offers
payment for his or her shares or else the right is waived. Citizens Bancorp
may either accept such dissenting shareholder's estimate of fair value or
commence a proceeding in the Wisconsin Circuit Court of Walworth County to
determine the fair value of the shares of all dissenting shareholders whose
own estimates of fair value are not accepted by Citizens Bancorp.
In the event any holder of Citizens Bancorp Stock fails to perfect his
or her rights to dissent by failing to comply strictly with the applicable
statutory requirements of Sections 180.1301-180.1331 of the WBCL, he or she
will be bound by the terms of the Merger Agreement and will not be entitled
to payment for his or her shares under the WBCL. ANY HOLDER OF CITIZENS
BANCORP STOCK WHO WISHES TO OBJECT TO THE TRANSACTION AND DEMAND PAYMENT IN
CASH FOR HIS OR HER SHARES SHOULD CONSIDER CONSULTING HIS OR HER OWN LEGAL
ADVISOR.
Because an executed proxy relating to Citizens Bancorp Stock on which
no voting direction is made will be voted at the Special Meeting in favor of
the Merger, a dissenting shareholder who wishes to have his or her shares of
Citizens Bancorp Stock represented by proxy at the Special Meeting but
preserve his or her dissenters' rights must mark his or her proxy either to
vote against the Merger or to abstain from voting thereon, in addition to the
foregoing requirements.
The foregoing, while a summary of all material provisions of Sections
180.1301-180.1331 of the WBCL, is qualified in its entirety by reference to
the text of such statutory provisions, which text is set forth in its
entirety in Appendix B hereto.
<PAGE>
One of the conditions to the Merger is that the holders of no more than
5% of the shares of Citizens Bancorp Stock will, on the Effective Date, be
entitled to assert statutory dissenters' rights under Section 180.1302(1) of
the WBCL. See "- Conditions to Merger."
Regulatory Approvals Required
The Merger is subject to the approval of the Federal Reserve Board
under Section 3 of the BHCA. M&I filed the necessary application with the
Federal Reserve Board in January 1995.
In determining whether to approve a merger that is subject to Federal
Reserve Board review, Section 3 of the BHCA requires that the Federal Reserve
Board take into consideration, among other factors, the financial and
managerial resources and future prospects of the institutions and the
convenience and needs of the communities to be served. The BHCA prohibits
the Federal Reserve Board from approving a merger (i) if it would result in a
monopoly or be in furtherance of any combination or conspiracy to monopolize
or to attempt to monopolize the business of banking in any part of the United
States or (ii) if its effect in any section of the country may be substan-
tially to lessen competition or to tend to create a monopoly, or if it would
in any other manner be a restraint of trade, unless the Federal Reserve Board
finds that the anti-competitive effects of the merger are clearly outweighed
by the public interest and the probable effect of the transaction in meeting
the convenience and needs of the communities to be served. The Community
Reinvestment Act of 1978 also requires that the Federal Reserve Board, in
deciding whether to approve a merger, assess the record of performance of the
bank subsidiaries of the parties involved in meeting the credit needs of the
entire community, including low- and moderate-income neighborhoods, served by
such bank subsidiaries. The Federal Reserve Board has also indicated that it
will not approve a significant acquisition unless the resulting institution
has adequate regulatory capital, taking into account, among other things, the
nature of the business and operations and plans for expansion.
Pursuant to the BHCA, the Merger may not be consummated until the 15th
day following the date of Federal Reserve Board approval, during which time
the United States Department of Justice may challenge the Merger on antitrust
grounds. The commencement of an antitrust action would stay the effective-
ness of the Federal Reserve Board's approval unless a court specifically
orders otherwise.
Management After the Merger
The board of directors and principal officers of the Surviving Bank as
of the Effective Date will consist of the persons who are the directors and
principal officers of M&I Interim Corp. immediately prior to the Effective
Date. Such persons will serve as directors and principal officers of the
Surviving Corporation until the next annual meeting of the Surviving
Corporation or until such time as their successors have been duly qualified
and elected or appointed in accordance with the By-Laws of the Surviving
Corporation. See "CERTAIN RELATED TRANSACTIONS."
COMPARISON OF SHAREHOLDER RIGHTS
The following is a summary of material differences between the rights
of holders of M&I Stock and the rights of holders of the Citizens Bancorp
Stock prior to the Merger. As both M&I and Citizens Bancorp are organized
under the laws of Wisconsin, rights of shareholders are substantially
similar. Differences in the rights provided to shareholders of M&I and
Citizens Bancorp arise from the provisions of the articles of incorporation,
by-laws and certain contractual commitments of the entities. This summary
does not purport to be a complete discussion of and is qualified in its
entirety by reference to the governing law and the articles of incorporation,
by-laws and contractual commitments of each entity.
<PAGE>
Required Vote for Authorization of Certain Transactions
M&I. Pursuant to Section 180.1706(1) of the WBCL, except as otherwise
provided in a corporation's articles of incorporation or by-laws, any
amendment to the articles of incorporation, merger or certain other
extraordinary events involving a corporation organized before January 1,
1973, which did not expressly elect before January 1, 1991 to be governed by
a majority or greater voting requirement, must be approved by the affirmative
vote of two-thirds of the shares entitled to vote at a meeting called for
that purpose. The M&I Articles were amended prior to January 1, 1991 to
reduce the vote required for a merger, consolidation or certain other
extraordinary events to a majority vote of the M&I capital stock entitled to
vote, provided that three-quarters of the M&I Board of Directors shall have
approved the transaction. The M&I Articles were not amended prior to January
1, 1991 to reduce the vote required to amend the M&I Articles. Consequently,
any amendment to the M&I Articles requires the affirmative vote of two-thirds
of the outstanding shares of M&I capital stock entitled to vote at a meeting
called for that purpose.
Citizens Bancorp. Citizens Bancorp was organized after January 1, 1973
and, as such, Section 180.1706(1) of the WBCL does not apply to certain
transactions involving Citizens Bancorp. Instead, the majority voting
provisions of the following sections of the WBCL apply: Section 180.1003(3)
(relating to amendment of articles of incorporation); Section 180.1103(3)
(relating to action on plan of merger or share exchange); Section 180.1202(3)
(relating to sale of assets other than in the regular course of business);
Section 180.1402(3) (relating to dissolution); and Section 180.1404(2)
(relating to revocation of dissolution). Thus, except as may otherwise be
provided by the WBCL, the affirmative vote of a majority of the outstanding
shares of Citizens Bancorp capital stock entitled to vote is required to
adopt amendments to the Citizens Bancorp's Articles of Incorporation or to
approve mergers and certain other extraordinary transactions.
Amendment of By-laws
M&I. M&I's Articles of Incorporation and By-laws provide that M&I's
By-laws may be amended only by the affirmative vote of not less than two-
thirds of the outstanding shares of capital stock of M&I entitled to vote at
a meeting of shareholders duly called for such purpose, or by a vote of not
less than three-quarters of the entire Board of Directors then in office.
Citizens Bancorp. Citizens Bancorp's By-laws provide that its By-laws
may be amended, repealed, or adopted by either the board of directors, by
vote of a majority of its members, or the shareholders, by vote of a majority
of the shares entitled to vote. However, the board of directors may not
amend or repeal any By-laws that have been adopted by the shareholders of
Citizens Bancorp.
Size, Classification of, and Vote Required to Elect Board of Directors
M&I. The M&I Articles and By-laws provide that the M&I Board of
Directors will consist of not less than three directors (exclusive of
directors, if any, elected by the holders of one or more classes of series of
M&I Preferred Stock pursuant to the M&I Articles applicable thereto), the
exact number of which to be determined from time to time by resolution
adopted by an affirmative vote of a majority of the entire Board of Directors
then in office. M&I's Board of Directors is classified into three classes,
with directors serving staggered three-year terms. The M&I By-laws provide
that directors are to be elected by a plurality of the votes cast by the
capital stock entitled to vote in the election.
Citizens Bancorp. Citizens Bancorp's By-laws provide that its Board of
Directors will consist of not less than five nor more than 12 directors, the
exact number of which to be determined by its stockholders at their annual
meeting. Citizens Bancorp's Articles of Incorporation and By-laws do not
provide for the classification of its Board of Directors. However, each
director shall hold office for one year and until the director's successor
has been elected and qualified. Citizens Bancorp's By-laws provide that a
majority of the capital stock represented at a meeting and entitled to vote
shall be necessary for the election of each director.
<PAGE>
Removal of Directors for "Cause"
M&I. Exclusive of directors, if any, elected by holders of one or more
classes of M&I Preferred Stock, shareholders of M&I may remove a director
only for "cause" and then only by a vote of two-thirds of the outstanding
shares of capital stock of M&I entitled to vote at a meeting of shareholders
called for that purpose. "Cause" is defined solely as malfeasance arising
from the performance of a director's duties which has a materially adverse
effect on the business of M&I.
Citizens Bancorp. Citizens Bancorp's By-laws provide that a director
may be removed from office by the affirmative vote of a majority of the
capital stock represented and entitled to vote at a special meeting called
for that purpose, with or without "cause."
Newly Created Directorships and Vacancies on the Board of Directors
M&I. Pursuant to Section 180.0810 of the WBCL, unless otherwise
provided in a corporation's Articles of Incorporation, shareholders may fill
vacancies on a corporation's Board of Directors. The M&I Articles and
By-laws provide that newly created directorships and any vacancies on M&I's
Board of Directors shall be filled by the majority vote of the Board of
Directors.
Citizens Bancorp. Citizens Bancorp's By-laws authorize the Board of
Directors to fill vacancies on Citizens Bancorp's Board of Directors until
the next succeeding election of directors, by the affirmative vote of a
majority of the directors then in office, although less than a quorum.
Advance Notice of Proposals to be Brought at the Annual Meeting
M&I. Pursuant to Section 2.5 of the M&I By-laws, any shareholder who
intends to bring business before an annual meeting of shareholders (other
than nominations for directors) must provide M&I with notice of such
intention, the nature of such proposal, the reasons for conducting such
business at the annual meeting and certain information regarding the
shareholder bringing the proposal not less than 60 days prior to the meeting.
Citizens Bancorp. Citizens Bancorp's Articles of Incorporation and
By-laws do not contain any provisions relating to advance notice of proposals
to be brought before an annual meeting.
Advance Notice of Nominations of Directors
M&I. Pursuant to Article VI of the M&I Articles and Section 2.6 of the
By-laws, any shareholder who intends to nominate directors for election at a
meeting called for that purpose must provide M&I with notice of such
intention, a written consent of the nominee to serve as a director, certain
information regarding the proposed nominee and certain information regarding
the nominating shareholder not less than 30 days prior to the meeting.
Citizens Bancorp. Neither Citizens Bancorp's Articles of Incorporation
nor its By-laws contain any provisions relating to advance notice of
nominations of directors.
Certain Business Combinations
M&I. Article XI of M&I's Articles provides that an affirmative vote of
80% of M&I's outstanding capital stock entitled to vote in the election of
directors, or two-thirds of the shares entitled to so vote excluding shares
of M&I capital stock held by an "interested stockholder" (as hereinafter
defined), is required to approve a merger, consolidation or other business
combination involving M&I, or any subsidiary, and any interested stockholder
or an affiliate or associate of an interested stockholder (excluding M&I or
any subsidiary thereof or employee benefit plan for the benefit of employees
of M&I or its subsidiaries). An interested stockholder refers to (a) the
beneficial owner of more than 10% of M&I's outstanding capital stock entitled
to vote,
<PAGE>
(b) an affiliate or associate of M&I that at any time within the two year
period preceding the combination was a beneficial owner of 10% or more of the
outstanding M&I capital stock entitled to vote or (c) an assignee of or
successor to any M&I capital stock entitled to vote previously beneficially
owned within the two year period preceding the combination by another
interested stockholder, if such assignment or succession shall have occurred
in the course of a transaction not involving a public offering within the
meaning of the Securities Act. These provisions of the M&I Articles do not
apply if (a) the consideration offered in connection with such transaction
satisfies certain "fair price" requirements or (b) a majority of the
"disinterested directors" (defined as a director who is not affiliated with
the interested stockholder and who either was (i) a member of the Board of
Directors prior to the date that the interested stockholder became such or
(ii) elected or recommended for election by a majority of the disinterested
directors in office at the time such director was nominated for election)
approves the transaction.
Citizens Bancorp. Neither Citizens Bancorp's Articles of Incorporation
nor its By-laws contain any supermajority voting provisions relating to the
approval by holders of its capital stock of mergers, consolidations or other
business combinations.
Dissenters' Rights of Appraisal
M&I. Pursuant to Section 180.1302 of the WBCL, dissenters' rights of
appraisal are provided when a corporation consummates (i) a plan of merger,
if shareholder approval is required by statute or by the corporation's
articles of incorporation, or if the corporation is a subsidiary that is
merged with its parent; (ii) a plan of share exchange, if the corporation's
shares will be acquired and shareholder approval is required; or (iii) a sale
or exchange of all, or substantially all, of the corporation's property other
than in the usual and regular course of business including a sale in
dissolution, but not including a sale pursuant to a court order or a sale for
cash pursuant to a plan by which all or substantially all of the net proceeds
of the sale will be distributed to the shareholders within one year after the
date of sale. However, no such rights are provided if (i) the shares of the
corporation are listed on a national securities exchange or quoted on NASDAQ,
or (ii) the corporation is undergoing a reorganization, unless the
reorganization plan provides otherwise. The foregoing exceptions
notwithstanding, the WBCL provides dissenters' rights of appraisal in
connection with certain business combinations involving a corporation and an
"interested stockholder." See "- Certain Business Combinations."
Citizens Bancorp. The discussion of Section 180.1302 of the WBCL
relating to dissenters' rights of appraisal described above with respect to
M&I is likewise applicable to Citizens Bancorp.
CERTAIN PROVISIONS OF THE WISCONSIN BUSINESS CORPORATION LAW
The following is a description of certain provisions applicable to
Wisconsin corporations, such as M&I and Citizens Bancorp.
The WBCL provides that shareholders of Wisconsin domestic corporations
are personally liable, up to the par value of their shares ($1.00 per share
in the case of both M&I Stock and Citizens Bancorp Stock), for all debts owed
by the corporation to employees for services performed but not exceeding six
months' service in any one case. While the WBCL specifies that such
liability is limited to the par value of the shares, par value has been
interpreted by a Wisconsin court to mean the consideration paid to the
corporation for its shares.
The WBCL prohibits a "business combination" (defined to include a
merger, share exchange or a disposition of 5% or more of the aggregate market
value of all assets or stock of the corporation) between a "resident domestic
corporation" and an "interested stockholder" (defined as the beneficial owner
of at least 10% of the voting power of the outstanding stock) for three years
following the stock acquisition date (i.e., the date the person became an
interested stockholder), unless the board of directors approves the business
combination or the purchase of stock by the interested stockholder before the
stock acquisition date. Business combinations after the three-year period
following the stock acquisition date are permitted only if (i) the board of
<PAGE>
directors approved the acquisition of the stock prior to the stock
acquisition date; (ii) the business combination is approved by a majority of
the outstanding voting stock not beneficially owned by the interested
stockholder; or (iii) the consideration to be received by shareholders meets
certain requirements of the statute with respect to form and amount. Both
M&I and Citizens Bancorp are "resident domestic corporations" within the
meaning of the WBCL.
Under the WBCL, the voting power of shares of an "issuing public
corporation" held by any person or persons acting as a group in excess of 20%
of the voting power in the election of directors is limited (in voting on any
matter) to 10% of the full voting power of those excess shares. An issuing
public corporation is defined as a domestic corporation, with (i) total
assets exceeding $1,000,000; (ii) a class of equity securities held of record
by 500 or more persons; and (iii) at least 100 shareholders of record who
have unlimited voting rights and who reside in Wisconsin. Only M&I is an
"issuing public corporation" within the meaning of the WBCL. This
restriction does not apply to shares acquired (a) under an agreement entered
into before the corporation was an "issuing public corporation," (b) directly
from the issuing public corporation, (c) in a merger or share exchange to
which the issuing public corporation is a party, (d) in certain specified
non-market transactions (i.e., gifts, distributions upon death and pledges)
or (e) in a transaction incident to which the corporation's shareholders have
approved restoration of the full voting power of the otherwise restricted
shares.
The WBCL provides that, in addition to the vote otherwise required by
law or the articles of incorporation of an "issuing public corporation"
(defined above), the approval by a majority vote of the holders of the
corporation's shares entitled to vote is required before such corporation can
take certain actions while a "takeover offer" (as defined in the WBCL) is
being made or after a takeover offer has been publicly announced and before
it is concluded. Under the WBCL, such shareholder approval is required for
the corporation to (i) acquire more than 5% of the corporation's outstanding
voting shares at a price above the market price from any individual or
organization that owns more than 3% of the outstanding voting shares and has
held such shares for less than two years, unless a similar offer is made to
acquire all voting shares or (ii) sell or option assets of the corporation
which amount to at least 10% of the market value of the corporation, unless
the corporation has at least three independent directors and a majority of
the independent directors vote not to have this provision apply to the
corporation.
The WBCL also provides for certain super-majority voting and fair price
provisions in connection with certain business combinations substantially
similar to provisions contained in M&I's Articles. See "COMPARISON OF
SHAREHOLDER RIGHTS - Certain Business Combinations."
Under the WBCL, in discharging his or her duties to the corporation and
in determining what he or she believes to be the best interests of the
corporation, a director or officer may, in addition to considering the
effects of any action on the corporation's shareholders, consider the effects
of the action on employees, suppliers, customers, the communities in which
the corporation operates and any other factors that the director or officer
considers pertinent.
CERTAIN INFORMATION CONCERNING CITIZENS BANCORP
Business
Citizens Bancorp is a one-bank holding company, incorporated in
Wisconsin in 1986, which owns 100% of Citizens Bank of Delavan ("Citizens
Bank"), a Wisconsin state bank chartered in 1900. Both Citizens Bancorp and
Citizens Bank are headquartered in the southeastern Wisconsin community of
Delavan, in Walworth County. Citizens Bancorp acts primarily as a holding
company for Citizens Bank and does not have significant business operations
of its own. Citizens Bank offers a wide range of traditional bank services
which include commercial and consumer lending, depository account services
and other services to individuals and businesses. Citizens Bank's service
area is in the immediate geographical area of its main office.
<PAGE>
See "INDEX TO FINANCIAL STATEMENTS" for historical financial statements
of, and other financial information regarding, Citizens Bancorp.
Market Information and Dividends
The number of holders of record of Citizens Bancorp Stock at January
31, 1995 was 38.
Citizens Bancorp Stock is not listed on any exchange nor quoted in the
over-the-counter market, and no established "bid" or "ask" price is
available. In the opinion of Citizens Bancorp, due to the lack of an active
market for shares of Citizens Bancorp Stock, transactions in Citizens Bancorp
Stock of which Citizens Bancorp is aware are not frequent enough to
constitute representative prices. The last sale of Citizens Bancorp Stock of
which Citizens Bancorp is aware was at $4,109 per share on May 10, 1994.
Dividends of $146 and $134 per share of Citizens Bancorp Stock were
paid in fiscal 1994 and 1993, respectively. In addition, pursuant to the
Merger Agreement, Citizens Bancorp has agreed not to declare or pay any
dividends prior to the Effective Date on its outstanding shares of its
capital stock, except for dividends paid in the ordinary course of business
and consistent with its past practices. See "THE CONSOLIDATION - Additional
Covenants and Agreements."
Share Ownership
The following table sets forth information regarding the beneficial
ownership of shares of Citizens Bancorp Stock as of January 31, 1995 by (i)
Citizens Bancorp's directors and executive officers; (ii) Citizens Bancorp's
directors and executive officers as a group; and (iii) persons who are known
to Citizens Bancorp to beneficially own more than 5% of Citizens Bancorp
Stock.
<PAGE>
Name and address(1) Number of Shares Percent
------------------ ---------------- -------
Daniel Brown 9 *
Irvine C. Llewellyn 255 6.9%
Barbara J. McCullough 160 4.3
Charles G. Spooner 20 *
Prescott P. Wurlitzer ** 313 8.5
Rymund P. Wurlitzer *** 575 15.5
All directors and executive
officers as a group (6 individuals) 1,332 36.0
Heidi Wurlitzer Haas ** 246 6.6
799 Garrison Court
Delafield, Wisconsin 53018
Kristina Wurlitzer Harvey ** 310 8.4
4113 West Friedstadt Road
Mequon, Wisconsin 53092
Amy Wurlitzer Hopkins ** 307 8.3
6934 Wellauer Drive
Wauwatosa, Wisconsin 53213
Margaret Wurlitzer Steinmetz ** 236 6.4
90 West Mountain Road
West Simsbury, Connecticut 06092
Polly T. Taplin 520 14.0
116 East Washington Street
Lake Bluff, Illinois 60044
Wendy M. Wurlitzer ** 273 7.4
12300 Chadsworth Court
Glen Allen, Virginia 23060
Margaret H. Wurlitzer *** 267 7.2
6109 North Lake Drive
Milwaukee, Wisconsin 53217
________________
* Less than 1%.
** Prescott and Wendy Wurlitzer, and Heidi Haas, Kristina Harvey, Amy
Hopkins and Margaret Steinmetz are the children of Mr. Rymund P. and
Ms. Margaret H. Wurlitzer.
*** Mr. Rymund P. and Ms. Margaret H. Wurlitzer are husband and wife.
(1) Includes any shares held by, or jointly with, a spouse and/or dependent
children. The shares are reported in such cases on the presumption
that the individual may share voting and/or investment power because of
the family relationship.
<PAGE>
CERTAIN INFORMATION CONCERNING M&I
Information regarding the names, ages, positions and business
backgrounds of the executive officers and directors of M&I, as well as
additional information, including executive compensation, security ownership
of certain beneficial owners and management and certain relationships and
related transactions, is incorporated herein by reference to M&I's Annual
Report on Form 10-K for the year ended December 31, 1993.
CERTAIN RELATED TRANSACTIONS
Following consummation of the Merger of Citizens Bancorp with and into
M&I Interim Corp., which will result in M&I owning 100% of Citizens Bank,
previously a wholly-owned subsidiary of Citizens Bancorp, and the related
Consolidation of Sharon Bank with and into Citizens Bank, certain persons who
were previously under the employ of Citizens Bank will continue to hold their
respective positions pursuant to an employment agreement dated August 31,
1994 between such persons and M&I. Specifically, Rymund Wurlitzer will
continue in the position of Chairman of the Board with Citizens Bank until he
reaches the age of 75. Mr. Wurlitzer's compensation will be $100,000 per
year. He will be eligible to receive benefits consistent with other M&I
personnel in similar positions. If Mr. Wurlitzer's employment duties and
responsibilities change materially, he is permitted to resign, although M&I
would continue to pay his salary until age 75. In addition, Ms. Margaret
Wurlitzer, Mr. Wurlitzer's wife, will continue to hold her present position
as a part-time teller with Citizens Bank for as long as Mr. Wurlitzer is
employed there.
RECENT LEGISLATION
The Riegle-Neal Interstate Banking and Branching Efficiency Act
of 1994 became effective on September 29, 1994 (the "Interstate Banking
Act"). The Interstate Banking Act amends the Bank Holding Company Act to
permit, as of September 29, 1995 and with certain limitations, adequately
capitalized and managed bank holding companies to acquire control, or all the
assets, of banks located in a state other than the home state of the bank
holding company. The Interstate Banking Act also amends the Federal Deposit
Insurance Act to permit, as of June 1, 1997 and with certain limitations,
merger transactions between adequately capitalized and managed insured banks
with different home states. The provisions of the Interstate Banking Act
generally increase the ease with which banks and bank holding companies may
acquire banks across state lines, and may increase the pace of consolidation
in the banking industry and the competition for independent banks and bank
holding companies.
EXPERTS
The consolidated financial statements of M&I, incorporated in this
Prospectus/Proxy Statement by reference, have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their report with
respect thereto, and are incorporated by reference in this Prospectus/Proxy
Statement in reliance upon the authority of said firm as experts in
accounting and auditing in giving said report.
The consolidated statement of financial position at December 31, 1994,
and consolidated statements of income, changes in shareholders' equity and
cash flows for the year ended December 31, 1994 of Citizens Bancorp, included
n this Prospectus/Proxy Statement, have been audited by Arthur Andersen LLP,
independent public accountants, as set forth in their report with respect
thereto. Citizens Bancorp's consolidated statement of financial position at
December 31, 1993 and consolidated statements of income, changes in
shareholders' equity and cash flows for the years ended December 31, 1993
and 1992, also included herein, have not been audited.
<PAGE>
LEGAL OPINION
A legal opinion to the effect that the issuance of the shares of M&I
Stock offered hereby has been duly authorized by M&I and that the shares,
when issued in accordance with the Merger Agreement, will be duly issued and
outstanding, fully paid and nonassessable (except as provided by Section
180.0622 of the WBCL), has been rendered by Godfrey & Kahn, S.C., Milwaukee,
Wisconsin.
SHAREHOLDER PROPOSALS
If the Merger is consummated, shareholders of Citizens Bancorp will
become shareholders of M&I. M&I's 1996 Annual Meeting is scheduled for April
23, 1996. In accordance with M&I's By-Laws, nominations, other than by or at
the direction of the M&I Board of Directors, of candidates for election as
directors at the 1996 Annual Meeting must be submitted to M&I not later than
March 23, 1996. In addition, any M&I shareholder who wishes to submit a
proposal for presentation to the 1996 Annual Meeting of Shareholders of M&I
must have submitted the proposal in writing to M&I, 770 North Water Street,
Milwaukee, Wisconsin 53202, Attention: M.A. Hatfield, Secretary, by November
11, 1995 for inclusion, if appropriate, in M&I's proxy statement and the form
of proxy relating to the 1996 Annual Meeting. To avoid disputes as to the
date of receipt, it is suggested that any shareholder proposal be submitted
by certified mail, return receipt requested.
<PAGE>
INDEX TO FINANCIAL STATEMENTS
Citizens Bancorp
Independent Public Accountants Report . . . . . . . . . . . . . . . . .F-1
Consolidated Statements of Financial Position at
December 31, 1994 (audited) and December 31, 1993
(unaudited)* . . . . . . . . . . . . . . . . . . . . . . . . . . . .F-2
Consolidated Statements of Income for the years ended
December 31, 1994 (audited), December 31, 1993
(unaudited) and December 31, 1992 (unaudited)* . . . . . . . . . . .F-3
Consolidated Statements of Changes in Shareholders' Equity for
the years ended December 31, 1994 (audited), December 31, 1993
(unaudited)* and December 31, 1992 (unaudited)*. . . . . . . . . . .F-4
Consolidated Statements of Cash Flows for the years ended
December 31, 1994 (audited), December 31, 1993 (unaudited)*
and December 31, 1992 (unaudited)* . . . . . . . . . . . . . . . . .F-5
Notes to Consolidated Financial Statements. . . . . . . . . . . . . . .F-6
Management's Discussion and Analysis of Financial Condition
and Results of Operations. . . . . . . . . . . . . . . . . . . . . F-15
- ----------------------
* Unaudited financial information for the periods indicated was obtained
from Citizens Bancorp's Federal Y-9 Reports and Citizens Bank's
Consolidated Reports of Condition and Income (collectively, the
"Reports"), which are filed by the respective organizations with the
FDIC. The Reports are prepared in accordance with regulatory
instructions issued by the Federal Financial Institutions Examination
Counsel. Because of the special supervisory, regulatory and economic
policy needs served by these Reports, those regulatory instructions do
not in all cases follow generally accepted accounting principles or
opinions and statements of the Accounting Principles Board or the
Financial Accounting Standards Board.
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors of
Citizens Bancorp of Delavan, Inc.:
We have audited the accompanying consolidated statement of financial position
of Citizens Bancorp of Delavan, Inc. (a Wisconsin corporation) and subsidiary
as of December 31, 1994, and the related consolidated statements of income,
changes in shareholders' equity and cash flows for the year then ended.
These consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the consolidated financial
statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Citizens
Bancorp of Delavan, Inc. and subsidiary as of December 31, 1994, and the
results of their operations and their cash flows for the year then ended in
conformity with generally accepted accounting principles.
As discussed in Note 1 to the consolidated financial statements, effective
January 1, 1994, the Company changed its method of accounting for investment
securities.
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin,
February 3, 1995.
<PAGE>
CITIZENS BANCORP OF DELAVAN, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS OF DECEMBER 31, 1994 AND 1993
(Dollars in thousands)
ASSETS 1994 1993
- ------ -------- --------
Unaudited
CASH AND DUE FROM BANKS (Note 3) $ 2,037 $ 1,521
FEDERAL FUNDS SOLD 1,320 2,678
------ ------
Total cash and cash equivalents 3,357 4,199
INVESTMENT SECURITIES AVAILABLE FOR SALE,
at market value in 1994, at amortized cost
in 1993, (market value $3,904) (Note 3) 3,360 3,513
INVESTMENT SECURITIES HELD TO MATURITY,
at amortized cost in 1994 and 1993,
(market value of $28,663 in 1994 and
$31,380 in 1993) (Note 3) 29,242 29,229
LOANS (Note 4) 61,526 57,964
Less- Reserve for loan losses (888) (888)
------- -------
Net Loans 60,638 57,076
BANK PREMISES AND EQUIPMENT, net 199 232
ACCRUED INTEREST AND OTHER ASSETS 1,828 1,126
------- -------
Total assets $98,624 $95,375
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY 1994 1993
- ------------------------------------ -------- ---------
Unaudited
DEPOSITS:
Noninterest-bearing deposits $ 7,012 $ 7,117
Interest-bearing deposits 64,459 62,429
------ ------
Total deposits 71,471 69,546
SECURITIES SOLD UNDER REPURCHASE
AGREEMENTS 6,820 7,158
ACCRUED EXPENSES AND OTHER LIABILITIES 259 231
------- -------
Total liabilities 78,550 76,935
COMMITMENTS AND CONTINGENT LIABILITIES
(Note 6)
SHAREHOLDERS' EQUITY (Notes 1 and 8)
Common stock ($1 par value, 56,000
shares authorized; 3,703 shares
issued and outstanding) and
paid-in capital 8,583 8,945
Net unrealized gain on investment
securities net of deferred
tax of $18 27 -
Retained earnings 11,464 9,495
------- -------
Total shareholders' equity 20,074 18,440
------- -------
Total liabilities and
shareholders' equity $98,624 $95,375
======= =======
The accompanying notes to financial statements are an integral part of these
statements.
<PAGE>
CITIZENS BANCORP OF DELAVAN, INC.
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
(Dollars in thousands)
1994 1993 1992
-------- -------- --------
Unaudited Unaudited
INTEREST INCOME:
Interest and fees on loans $5,279 $5,086 $4,878
Interest on investment securities-
Taxable 808 946 1,217
Nontaxable 1,462 1,311 945
Interest on Federal funds sold 61 63 62
------ ------ ------
Total interest income 7,610 7,406 7,102
------ ------ ------
INTEREST EXPENSE:
Interest on deposits 2,655 2,582 3,041
Interest on short-term debt 320 332 349
------ ------ ------
Total interest expense 2,975 2,914 3,390
------ ------ ------
Net interest income 4,635 4,492 3,712
PROVISION FOR LOAN LOSSES (Note 4) 65 202 497
------ ------ ------
Net interest income after provision
for loan losses 4,570 4,290 3,215
------ ------ ------
NONINTEREST INCOME:
Service charges on deposit accounts 107 106 109
Other service charges, commissions and fees 52 29 37
Net securities gains 1 62 34
------ ------ ------
Total noninterest income 160 197 180
------ ------ ------
NONINTEREST EXPENSE:
Salaries and employee benefits 817 653 630
Equipment and premises expense 84 77 86
Professional services 24 13 13
Processing charges 99 94 75
Payments to regulatory agencies 161 164 104
Other 129 124 113
------ ------ ------
Total noninterest expense 1,314 1,125 1,021
------ ------ ------
INCOME BEFORE INCOME TAXES 3,416 3,362 2,374
INCOME TAXES (Note 5) 903 925 655
------ ------ ------
Net income $2,513 $2,437 $1,719
====== ====== ======
The accompanying notes are an integral part of these statements.
<PAGE>
CITIZENS BANCORP OF DELAVAN, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
(Years ended December 31, 1993 and 1992, are Unaudited)
(Dollars in thousands)
Net
Common Unrealized
Stock Gain (Loss)
and on Investment Total
Paid-In Securities Retained Shareholders'
Capital Net of Taxes Earnings Equity
------- ------------- -------- ------------
BALANCE, December 31, 1991 $8,999 $ - $6,325 $15,324
Net income - - 1,719 1,719
Dividends declared - - (478) (478)
Treasury stock purchased
and retired (54) - - (54)
------ --- ------- -------
BALANCE, December 31, 1992 8,945 - 7,566 16,511
Net income - - 2,437 2,437
Dividends declared - - (508) (508)
------ --- ------- -------
BALANCE, December 31, 1993 8,945 - 9,495 18,440
Net income - - 2,513 2,513
Adoption of FAS 115,
Accounting for Certain
Investments in Debt
and Equity Securities - 235 - 235
Dividends declared - - (544) (544)
Treasury stock purchased
and retired (362) - - (362)
Net change in unrealized
gain on investment
securities net of taxes - (208) - (208)
------ --- ------- -------
BALANCE, December 31, 1994 $8,583 $27 $11,464 $20,074
====== === ======= =======
The accompanying notes are an integral part of these statements.
<PAGE>
CITIZENS BANCORP OF DELAVAN, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
(Dollars in thousands)
1994 1993 1992
------ --------- --------
Unaudited Unaudited
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $2,513 $2,437 $1,719
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities-
Depreciation and amortization 33 1 8
Provision for loan losses 65 202 497
Net gain on sales of assets (1) (62) (34)
Increase (decrease) in other liabilities 30 23 (166)
(Increase) decrease in other assets (702) 82 (190)
------ ------ ------
Total adjustments (575) 246 115
------ ------ ------
Net cash provided by operating
activities 1,938 2,683 1,834
------ ------ ------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of investment
securities 24 2,733 3,607
Proceeds from maturities of
investment securities 1,003 2,332 2,773
Purchases of investment securities (926) (8,401) (11,626)
Net increase in loans (3,562) (5,858) (3,596)
------ ------ ------
Net cash used in investing activities (3,461) (9,194) (8,842)
------ ------ ------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net (decrease) increase in noninterest-
bearing deposits (105) 1,604 (220)
Net increase in interest-bearing deposits 2,030 4,386 7,782
Net (decrease) increase in repurchase
agreements (338) (12) 1,618
Dividends paid (544) (508) (478)
Purchase of treasury stock (362) - (54)
------ ------ ------
Net cash provided by financing
activities 681 5,470 8,648
------ ------ ------
Net (decrease) increase in cash
and cash equivalents (842) (1,041) 1,640
CASH AND CASH EQUIVALENTS, at beginning
of year 4,199 5,240 3,600
------ ------ ------
CASH AND CASH EQUIVALENTS, at end of year $3,357 $4,199 $5,240
====== ====== ======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid during the year for-
Interest $2,997 $2,945 $3,431
Income taxes 967 869 888
The accompanying notes are an integral part of these statements.
<PAGE>
CITIZENS BANCORP OF DELAVAN, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Information as of and for the years ended
December 31, 1993 and 1992, is Unaudited)
DECEMBER 31, 1994, 1993 AND 1992
(Dollars in thousands)
(1) Summary of Significant Accounting Policies-
The consolidated financial statements of Citizens Bancorp of Delavan,
Inc. and its wholly-owned subsidiary, Citizens Bank of Delavan (together,
the "Company") have been prepared in conformity with generally accepted
accounting principles. All significant intercompany balances and
transactions have been eliminated in consolidation. A description of the
significant accounting policies is as follows:
Investment securities-
Securities, when purchased, are designated as investment securities held
to maturity or investment securities available for sale and remain in
that category until they are sold or mature. The specific identification
method is used in determining the cost of securities sold. The Company
does not engage in the trading of securities.
Investment securities available for sale are carried at market value,
determined on an aggregate basis. While the Company has no current
intention to sell these securities, they may not be held to maturity.
Investment securities held to maturity are carried at cost, adjusted for
amortization of premiums and accretion of discounts and represent
securities which the Company has the positive intent and ability to hold
to maturity.
In May 1993, the Financial Accounting Standards Board (FASB) issued
Statement No. 115, "Accounting for Certain Investments in Debt and EquIty
Securities," (FAS 115). FAS 115 requires, among other things, that
securities classified as available for sale be carried at market value;
however, market value adjustments and the related income tax effects, are
excluded from earnings and reported separately as a component of
shareholders' equity. This new standard was adopted by the Company on
January 1, 1994.
Loans-
Interest on loans is recognized as income based on the loan principal
outstanding during the period. Loans are generally placed on nonaccrual
or are charged off when they are past due 90 days or more. Loan fees and
origination costs are not deferred. The Company has not adopted
Financial Accounting Standards Board Statement No. 91, "Accounting for
Nonrefundable Fees and Costs Associated with Originating Loans," as the
impact of adoption would not be material to the financial statements.
Reserve for loan losses-
The level of the reserve for loan losses is based upon management's
evaluation of the effects on the loan portfolio of current economic
conditions, various factors affecting the collectibility of loans and
changes in the character of the loan portfolio. The reserve for loan
losses is based on estimates. These estimates are reviewed periodically
and, as adjustments become necessary, they are reported in earnings in
the period in which they become known. Actual loan losses are recorded
as charges to the reserve for the principal amount of the loan. Any
subsequent recoveries are added to the reserve.
<PAGE>
For income tax purposes, the Company provides additions to the reserve in
accordance with the maximum amounts allowed under Federal income tax law.
Other real estate owned-
Other real estate owned includes assets that have been acquired in
satisfaction of debts, or accounted for as insubstance foreclosures.
Other real estate is recorded at the lower of cost or fair value, less
estimated selling costs, at the date of transfer. Valuation adjustments
required at the date of transfer for assets acquired in satisfaction of
debts or accounted for as insubstance foreclosures are charged to the
allowance for loan losses. Subsequent to transfer, other real estate
owned is carried at the lower of cost or fair market value, less
estimated selling costs, based upon periodic evaluations.
Bank premises and equipment-
Bank premises and equipment are stated at cost, less an allowance for
depreciation. Provisions for depreciation are charged to operating
expenses over the estimated useful lives of the assets.
Income taxes-
Certain items are accounted for in different periods for financial
reporting purposes than for income tax purposes. Provisions are made for
deferred taxes in recognition of these temporary differences.
Cash equivalents-
For purposes of the consolidated statement of cash flows, cash and cash
equivalents include cash on hand, amounts due from banks and federal
funds sold.
(2) Business Combination-
On August 31, 1994, the Company entered into an Agreement and Plan of
Reorganization (the "Agreement") whereby the Company will merge with and
into Marshall and Ilsley Corporation ("M&I"), a Wisconsin bank holding
company located in Milwaukee with consolidated assets of approximately
$12.6 billion. Under the terms of the Agreement each share of the
Company's common stock will be exchanged for 305.85 shares of the M&I's
common stock in a tax-free reorganization which is to be accounted for as
a purchase. The Agreement is subject to approval by the shareholders and
certain regulatory authorities. Consummation of the merger with and into
the M&I is expected to occur in the second quarter of 1995.
<PAGE>
(3) Cash and Investment Securities-
A summary of the amortized cost and estimated market values, as computed
by Bank One, Milwaukee, of investment securities at December 31 is as
follows:
1994 1993
-------------------- --------------------
Amortized Market Amortized Market
Cost Value Cost Value
--------- ------- --------- -------
Investment securities available
for sale:
Other Securities $3,315 $3,360 $3,513 $3,904
------- ------- ------- -------
Total $3,315 $3,360 $3,513 $3,904
======= ======= ======= =======
Investment securities held to
maturity:
U.S. Treasury Securities $5,353 $5,402 $5,686 $6,486
U.S. Agency Securities 919 853 921 950
State and Municipal Securities 22,970 22,408 22,622 23,944
------- ------- ------- -------
Total $29,242 $28,663 $29,229 $31,380
======= ======= ======= =======
The unrealized gains and loss on investment securities at December 31 were:
1994 1993
---------------------- ----------------------
Unrealized Unrealized Unrealized Unrealized
Gains Losses Gains Losses
---------- ---------- ---------- ----------
Investment securities available
for sale:
Other Securities $149 $104 $412 $21
---- ---- ---- ----
Total $149 $104 $412 $21
==== ==== ==== ====
Investment securities held to
maturity:
U.S. Treasury Securities $98 $49 $800 $ -
U.S. Agency Securities 5 71 35 6
State and Municipal Securities 238 800 1,377 55
---- ---- ------ ---
Total $341 $920 $2,212 $61
==== ==== ====== ====
<PAGE>
The amortized costs and market values of investment securities at December
31 by contractual maturity are shown below:
1994 1993
-------------------- --------------------
Amortized Market Amortized Market
Cost Value Cost Value
--------- ------- --------- -------
Investment securities available
for sale:
Within one year $ - $ - $ 100 $ 99
From one through five years 1,895 1,939 1,797 2,053
Over five years 877 865 973 1,032
No contractual maturity
(equities) 543 556 643 720
------- ------- ------- -------
Total $ 3,315 $ 3,360 $ 3,513 $ 3,904
======= ======= ======= =======
Investment securities held to
maturity:
Within one year $ 421 $ 425 $ 608 $ 618
From one through five years 5,023 5,119 6,446 7,107
Over five years 23,798 23,119 22,175 23,655
------- ------- ------- -------
Total $29,242 $28,663 $29,229 $31,380
======= ======= ======= =======
During 1994, 1993 and 1992, respectively, realized gains amounted to $1,
$65 and $35 and realized losses were $0, $3 and $1.
Securities with a par value of approximately $5,839 and $6,758 at December
31, 1994 and 1993, respectively, were pledged primarily to secure public
deposits and short-term borrowings and for other purposes required by law.
At December 31, 1994, $133 of cash and due from banks was restricted due to
Federal Reserve requirements to maintain certain reserve balances.
(4) Loans-
The composition of loans at December 31 is as follows:
1994 1993
------- -------
Real estate:
Construction $ 5,418 $ 4,427
Residential mortgage 25,138 21,965
Commercial mortgage 18,149 16,659
Commercial, financial, and agricultural 10,429 10,849
Industrial development revenue bonds 1,251 3,157
Lease financing 137 170
Personal 1,004 737
------- -------
Total loans $61,526 $57,964
======= =======
Eighty-nine percent of the Company's borrowers are located in Wisconsin.
The out of state loans represent primarily residential mortgage loans to
non-Wisconsin residents for second homes on lakes in and near the
community. As a community lender, the Company extends all forms of
credit to individuals and businesses in the communities and their
surroundings. Those communities are often dependent on a small number of
large employers or on the agricultural economy.
<PAGE>
Personal loans include residential, installment and education loans. The
Company evaluates the credit risk of each customer on an individual basis
and, where deemed appropriate, collateral is obtained. Collateral may
include accounts receivable, inventory, real estate, equipment, personal
guarantees and general security agreements. Access to collateral is
dependent upon the types of collateral obtained. The Company monitors
its collateral and the collateral value on an on-going basis.
At December 31, 1994, the Company had approximately $234 of nonperforming
loans which were earning below a market interest rate or were nonincome
producing. There were no nonperforming loans at December 31, 1993. The
effect of interest foregone on these loans is not significant.
There were no loans to directors, executive officers, shareholders or
their companies during 1994 or 1993.
An analysis of the reserve for loan losses for the years ended December
31 is as follows:
1994 1993 1992
---- ---- ----
Balance, beginning of year $888 $614 $643
Loans charged off (372) (448) (544)
Recoveries of charged off loans 307 520 18
Provisions charged to operating expense 65 202 497
---- ---- ----
Balance, end of year $888 $888 $614
==== ==== ====
In May 1993, the FASB issued Statement No. 114, "Accounting by Creditors
for Impairment of a Loan," (FAS 114). FAS 114 requires that a loan's
value be measured when it has been determined that the loan is impaired
and loss is probable. Write-downs which result from the measurement
process are to be expensed. FASB Statement No. 118, "Accounting by
Creditors for Impairment of a Loan--Income Recognition and Disclosures"
(FAS 118) amends FAS 114 in that it allows a creditor to use existing
methods for recognizing interest income on an impaired loan. These new
standards must be adopted by the Company in the first quarter of 1995.
Based upon the current status of the Company's loan portfolio, it is not
anticipated that these pronouncements will have a material impact on the
consolidated financial statements.
(5) Income Taxes-
Income taxes reflected in the consolidated statement of income include
the following components:
1994 1993 1992
---- ---- ----
Current $908 $905 $745
Deferred (benefit) provision (5) 20 (90)
---- ---- ----
Total $903 $925 $655
==== ==== ====
<PAGE>
The tax effects of temporary differences that give rise to significant
elements of the deferred tax assets and deferred tax liabilities at
December 31 are as follows:
1994 1993
---- ----
Deferred tax assets:
Reserve for loan losses $262 $262
Bank premises and equipment, principally due to
depreciation 1 (6)
---- ----
Total deferred tax assets 263 256
---- ----
Deferred tax liabilities:
Net unrealized appreciation on investment securities
available for sale 18 -
Discount on bonds 16 14
---- ----
Total deferred tax liabilities 34 14
---- ----
Net deferred tax assets $229 $242
==== ====
Total income tax expense is less than the amount computed by applying the
statutory Federal income tax rate to income before income taxes. The
reasons for this difference are as follows:
1994 1993 1992
--------------- -------------- --------------
Percent Percent Percent
of of of
Pretax Pretax Pretax
Amount Income Amount Income Amount Income
------ ------ ------ ------ ------ ------
Income tax computed at
statutory rate $1,161 34.0% $1,143 34.0% $807 34.0%
State taxes, net of
Federal benefit 188 5.5 185 5.5 131 5.5
Tax-exempt municipal
interest (442) (12.9) (446) (13.2) (321) (13.5)
Other, net (4) (.1) 43 1.2 38 1.6
------ ----- ------ ----- ---- -----
Total income tax
expense $ 903 26.5% $ 925 27.5% $655 27.6%
====== ===== ====== ===== ==== =====
(6) Commitments and Contingent Liabilities-
In the normal course of business, there are various outstanding commitments
and contingent liabilities, such as guarantees, commitments to extend
credit, etc., which are not reflected in the accompanying financial
statements. Outstanding commitments to extend credit totaled approximately
$3,013 and $5,339 at December 31, 1994 and 1993, respectively. Outstanding
letters of credit totaled approximately $136 and $114 at December 31, 1994
and 1993, respectively. The Company evaluates each customer's credit
worthiness on an individual basis. Collateral obtained, if any, upon
extension of credit, is based upon management's credit evaluation of the
customer. Collateral requirements and the ability to access collateral is
generally similar to that required on loans outstanding. Losses are not
anticipated as a result of these transactions.
<PAGE>
(7) Retirement Plan-
The Company has a defined contribution retirement plan which is subject to
the Internal Revenue Code, Section 412(i). This plan is funded exclusively
by individual insurance contracts. The Company's contribution in 1994,
1993 and 1992 was $77, $62 and $53, respectively.
(8) Shareholders' Equity-
Banks are subject to statutory and regulatory restrictions on the amount
they may pay in dividends, and certain of their retained earnings may not
be available for dividend payment. Retained earnings of the bank which are
available without restrictions for dividend payments to Citizens Bancorp of
Delavan, Inc. total approximately $4,601 and $4,994 at December 31, 1994
and 1993, respectively.
The bank's risk-based capital ratio is 20.8% and 19.5% at December 31, 1994
and 1993, respectively, which is in compliance with the minimum regulatory
requirements for risk-based capital.
(9) Parent Company Only-
The condensed financial positions of the Parent Company (parent company
only) as of December 31 and the results of its operations, and cash flows
for the years then ended are summarized below:
The condensed statements of financial position as of December 31:
1994 1993
Assets- ------ ------
Cash and cash equivalents $ 279 $ 140
Investment in subsidiary 18,952 17,494
Investment securities, available for sale 701 643
Loans 137 170
Other assets 18 4
------- -------
Total assets $20,087 $18,451
======= =======
Liabilities-
Other liabilities $ 13 $ 11
Shareholders' equity-
Common stock and paid-in capital 8,583 8,945
Net unrealized appreciation on investment securities
available for sale, net of deferred taxes of $18 27 -
Retained earnings 11,464 9,495
------- -------
Total shareholders' equity 20,074 18,440
------- -------
Total liabilities and shareholders' equity $20,087 $18,451
======= =======
<PAGE>
The condensed statements of income for the years ended December 31:
1994 1993 1992
------ ------ ------
Income-
Dividends from subsidiary $1,068 $ 672 $ 624
Investment income 44 34 49
Interest on loans 16 9 -
Gain on sale of investment securities 1 6 -
------ ------ ------
Total income 1,129 721 673
------ ------ ------
Expense-
Administrative and general 6 6 6
------ ------ ------
Total expense 6 6 6
------ ------ ------
Income before income taxes and equity in
undistributed earnings of subsidiary 1,123 715 667
Provision for income taxes 17 13 27
------ ------ ------
Net income (parent company only) 1,106 702 640
Equity in undistributed earnings of
subsidiary, net of dividends paid 1,407 1,735 1,079
------ ------ ------
Net income $2,513 $2,437 $1,719
====== ====== ======
<PAGE>
The condensed statement of cash flows for the year ended December 31:
1994 1993 1992
------ ------ ------
Cash flows from operating activities:
Net income (parent company only) $2,513 $2,437 $1,719
Adjustments to reconcile net income to net
cash provided by operating activities-
Equity in undistributed net income
of subsidiary (1,407) (1,735) (1,079)
Gain on sale of investment securities (1) (6) -
Increase (decrease) in other liabilities 2 (16) 16
Decrease in other assets 2 8 21
------ ------ ------
Net cash provided by operating activities 1,109 688 677
------ ------ ------
Cash flows from investment activities:
Proceeds from sales of investment securities 24 300 -
Purchase of longer term securities (121) (187) (137)
Decrease (increase) in loans 33 (170) -
------ ------ ------
Net cash used by investing activities (64) (57) (137)
------ ------ ------
Cash flows from financing activities:
Dividends paid (544) (508) (478)
Purchase of treasury stock (362) - (54)
------ ------ ------
Net cash used by financing activities (906) (508) (532)
------ ------ ------
Net increase in cash 139 123 8
Cash, at beginning of year 140 17 9
------ ------ ------
Cash, at end of year $279 $140 $17
====== ====== ======
Supplemental disclosure of cash flow information:
Cash paid during the year for-
Taxes $4 $2 $ -
<PAGE>
CITIZENS BANCORP OF DELAVAN, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
(Dollars in thousands)
The information provided herein is based on the results of Citizens Bancorp
of Delavan, Inc. (the "Company") for the years ended December 31, 1994, 1993
and 1992. A discussion of the results of operations for the Company would
not differ materially from that presented herein for Citizens Bank of Delavan
(the "Bank"). Included in the results of operations for the Company, but not
the Bank, is additional interest income on investment securities, certain
other income and expenses and the provision for income taxes.
A reconciliation of the net income of the Company to the net income of the
Bank is as follows:
Year Ended December 31,
------------------------------
1994 1993 1992
------ ------ -----
Net income of the Company $2,513 $2,437 $1,719
Interest on investment securities (44) (34) (49)
Other income (17) (15) --
Other expenses 6 6 6
Related income tax provision 17 13 27
------ ------ ------
Net income of the Bank $2,475 $2,407 $1,703
====== ====== ======
Financial Summary. 1994 net income of $2,475 increased by $68 from 1993 net
income of $2,407, which increased by $704 from 1992 net income of $1,703.
Return on average equity was 13.6%, 14.5% and 11.2% in 1994, 1993 and 1992,
respectively. The return on average assets was 2.6%, 2.7% and 2.1% in 1994,
1993 and 1992, respectively.
The following sections provide a more detailed review of the Bank's financial
performance. A portion of the Bank's income is derived from investments in
securities of states and political subdivisions. The interest income from
these investments is exempt from Federal income tax; therefore, the yield on
these investments is lower than the yield on investments with similar risks
and maturity characteristics whose interest is subject to Federal income tax.
For purposes of Management's Discussion and Analysis of Financial Condition
and Results of Operations, this nontaxable interest is treated at its taxable
equivalent, calculated using historical statutory Federal income tax rates
and reduced by interest expense disallowed as an income tax deduction.
Net Interest Income. Net interest income is the difference between gross
interest earned on average earning assets, primarily loans and investment
securities and interest paid on average deposits and funds borrowed to
finance investments and loans. Growth in net interest income is influenced
by the growth of earning assets and changes in the yields on earning assets.
The net yield is also influenced by changes in the level of interest rates,
changes in the mix of assets and liabilities and changes in asset and
liability maturity and interest rate sensitivity.
Net interest income increased $133 or 3.0% in 1994, while average earning
assets volume increased $5,323. Net interest income increased $795 or 21.7%
in 1993, compared to 1992, while earning assets volume increased $14,583.
<PAGE>
Ratios of net interest income to average earning assets (net interest margin)
were 5.0%, 5.1% and 4.7% in 1994, 1993 and 1992, respectively.
Interest income on loans increased $193 or 3.8% in 1994, and increased $208
or 4.3% in 1992. The average rate of return on loans was 9.0%, 9.4% and 9.8%
in 1994, 1993 and 1992, respectively. Average loan volume increased $4,541
or 8.4% in 1994, and $4,292 or 8.6% in 1993.
Interest income on U.S. Treasury and Federal Agency securities decreased $52
or 9.4% in 1994, and decreased in 1993, by $271 or 22.3% while tax exempt
interest income on obligations of state and municipal governments and
subdivisions thereof increased $151 or 11.5% in 1994, and increased $366 or
38.7% in 1993. The average tax equivalent rate of return on investment
securities was 9.2% in 1994, 9.3% in 1993 and 9.8% in 1992. The average
volume of investment securities increased $1,899 or 6.4% in 1994 and $4,913
or 19.7% in 1993. The increase in average investment securities was the
result of a decision by the Bank to increase the portfolio of tax-exempt
securities in order to maximize net income.
The composite yield on average interest earning assets on a fully taxable
equivalent basis was 8.9% in 1994, 9.1% in 1993 and 9.3% in 1992.
Interest expense on deposits and borrowed money increased $61 or 2.1% in
1994, and decreased $476 or 14.0% in 1993. The composite average interest
rate paid on interest bearing deposits was 4.2%, 4.3% and 5.6% in 1994, 1993
and 1992, respectively.
Loan Losses. The provision for loan losses charged to operations was $65,
$202 and $497 in 1994, 1993 and 1992, respectively. The allowance for loan
losses was $888 at December 31, 1994 and 1993, and was $614 at December 31,
1992, which represents 1.5%, 1.5% and 1.2% of outstanding loans at the end of
those years, respectively.
Other Income. Total other income decreased $39 or 21.4% in 1994 and $2 or
1.1% in 1993. The decrease in 1994, was mainly the result of fewer gains on
sales of investment securities.
Other Expenses. Total other expenses increased $189 or 16.9% in 1994, and
$104 or 10.2% in 1993. The significant increase in total other expenses in
1994, was mainly the result of bonuses being awarded in 1994 and not in 1993.
Income Taxes. The effective income tax rate of the Company was 26.5%, 27.5%
and 27.6% for 1994, 1993 and 1992, respectively.
Average Balance Sheet Analysis. Total average assets increased $5,545 or
6.1% in 1994, and $8,975 or 11.0% in 1993, while average earning assets
increased by $5,323 or 6.1% in 1994, and $9,592 or 12.3% in 1993. Average
taxable investment securities decreased $534 or 5.4% in 1994, and $1,644 or
14.3% in 1993, while average tax exempt securities increased $2,433 or 12.1%
and $6,557 or 48.5% in 1993. As a percentage of total assets, taxable
investments were 9.7% in 1994, 10.8% in 1993 and 14.0% in 1992, while tax
exempt securities were 23.4% in 1994, 22.1% in 1993 and 16.6% in 1992.
Average net loans and leases increased $4,541 or 8.4% in 1994 and $4,292 or
8.6% in 1993.
The primary source of funding earning asset growth in both 1994 and 1993, was
the increase each year in total deposits. Average deposits increased $4,089
or 6.1% in 1994, and $6,836 or 11.4% in 1993.
<PAGE>
The following table presents average balance sheet categories and their
percentage of total average assets for the Bank only, as assets at the parent
company are not significant to the Company:
Average Balance Sheet Composition of the Bank
Year Ended
-------------------------------------
December 31, December 31,
1994 1993
----------------- -----------------
$ % $ %
------- ----- ------- -----
Assets
Loans and leases (net) $58,704 61.1% $54,163 60.0%
Investment securities:
Taxable securities 9,295 9.7 9,829 10.8
Tax-exempt securities 22,508 23.4 20,075 22.1
Short-term investments 2,197 2.3 3,314 3.6
------- ----- ------- -----
Total interest earning assets 92,704 96.5 87,381 96.5
------- ----- ------- -----
Cash and due from banks 1,761 1.8 1,830 2.0
Other assets 1,682 1.7 1,391 1.5
------- ----- ------- -----
Total assets $96,147 100.0% $90,602 100.0%
======= ===== ======= =====
Year Ended
-------------------------------------
December 31, December 31,
1994 1993
----------------- -----------------
$ % $ %
------- ----- ------- -----
Liabilities and Shareholders' Equity
Savings and other time deposits:
Savings and NOW deposits $34,001 34.4% $32,709 36.1%
Other time deposits 29,634 30.8 27,587 30.5
------- ----- ------- -----
Total savings and other time
deposits 63,635 66.2 60,296 66.6
Other borrowings 6,989 7.3 7,164 7.9
------- ----- ------- -----
Total interest bearing
liabilities 70,624 73.5 67,460 74.5
Demand deposits 7,065 7.3 6,315 7.0
Other liabilities 234 .2 200 .2
Shareholders' equity 18,224 19.0 16,627 18.3
------- ----- ------- -----
Total liabilities and
shareholders' equity $96,147 100.0% $90,602 100.0%
======= ===== ======= =====
Capital Resources. Total shareholders' equity of the Company increased
$1,634 or 8.9% to $20,074 at December 31, 1994, and increased $1,929 or 11.7%
to $18,440 at December 31, 1993. The change in shareholders' equity in each
of these years was generated primarily from earnings less dividends declared
on common stock.
Liquidity. Liquidity is the ability of the Bank to meet its financial
commitments when contractually due or needed by depositors. The Bank's
primary external source of liquidity is its deposit base. Internally
generated liquidity is principally provided by funds and investment
securities sold and, to a lesser extent, through loans. The Bank's
investment in funds sold was $1,320 at December 31, 1994, and $2,678 at
December 31, 1993. The Bank's investment in securities which mature within
one year at December 31, 1994 and 1993, were $421 and $708, respectively.
<PAGE>
APPENDIX A
AGREEMENT AND PLAN OF REORGANIZATION, AS AMENDED
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") dated
as of the 31st day of August, 1994, by and between Marshall & Ilsley
Corporation, a Wisconsin corporation (the "Corporation") and Citizens Bancorp
of Delavan, Inc., a Wisconsin corporation (the "Bancorp"), which is the sole
owner of all of the outstanding shares of capital stock of the Citizens Bank
of Delavan (the "Bank").
W I T N E S S E T H
WHEREAS, this Agreement provides for: (i) the incorporation and
organization of M&I Interim Corp., a new Wisconsin corporation ("Interim")
under the laws of the State of Wisconsin which will, at the time of
consummation of the transactions herein provided, be a subsidiary of and
controlled by the Corporation within the meaning of Section 368(c) of the
Internal Revenue Code of 1986, as amended (the "IRC"); (ii) the merger of
Bancorp with and into Interim in accordance with applicable law and pursuant
to the terms of this Agreement and the Agreement and Plan of Merger between
Interim and Bancorp ("Merger Agreement"), attached hereto as Exhibit A; and
(iii) the conversion, at the Effective Time of such Merger (as defined
herein), of Bancorp's outstanding shares of common stock, $100.00 par value,
("Bancorp Stock") into the right to receive shares of the Corporation's $1.00
par value common stock (the "M&I Stock"), all upon the terms and conditions
hereinafter set forth. It is the intent of the parties that immediately
following the Effective Time, the Surviving Corporation (as defined herein)
will be liquidated into the Corporation by means of an upstream merger and,
as a result, the Bank will become a wholly-owned banking subsidiary of the
Corporation, operating under the name "M&I Bank of Delavan." The merger of
Bancorp into Interim to form the Surviving Corporation, followed by the
liquidation by upstream merger of the Surviving Corporation into the
Corporation, is intended to qualify as a tax-free reorganization pursuant to
Section 368(a)(1)(C) of the IRC.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements herein contained, the parties
hereto agree as follows:
ARTICLE I
CONSOLIDATION OF INTERIM INTO BANCORP
Section 1.01. Merger. In accordance with the provisions of this
Agreement, the Merger Agreement and applicable law, at the Effective Time (as
hereinafter defined) Bancorp shall be merged with and into Interim (which is
herein referred to as the "Surviving Corporation" whenever reference is made
to it on or after the Effective Time) and the separate existence of Bancorp
shall cease (the "Merger"). The Merger shall be consummated effective at the
date and time specified in Section 6.03 of this Agreement (the "Effective
Date" and "Effective Time," respectively).
<PAGE>
Section 1.02. Surviving Corporation. After the Effective Time
the name of the Surviving Corporation shall be "M&I Interim Corp." and the
Articles of Incorporation and By-Laws of Interim as in effect immediately
prior to the Effective Time shall be the Articles of Incorporation and By-
Laws, respectively, of the Surviving Corporation. The Surviving Corporation
shall continue its existence under the laws of the State of Wisconsin as a
wholly-owned subsidiary of the Corporation, until liquidated into the
Corporation in an upstream merger, as contemplated by the parties hereto.
Section 1.03. Business. The business of the Surviving
Corporation shall be that of a Wisconsin corporation and shall be conducted
at such locations as the Surviving Corporation may establish.
Section 1.04. Board of Directors; Officers. The Board of
Directors and principal officers of the Surviving Corporation as of the
Effective Time shall consist of the persons who are the directors and
principal officers of Interim immediately prior to the Effective Time. Such
persons shall serve as directors and principal officers of the Surviving
Corporation until the next annual meeting of the Surviving Corporation or
until such time as their successors have been duly qualified and elected or
appointed in accordance with the By-Laws of the Surviving Corporation.
Section 1.05. Effect of Merger. All assets of Bancorp, as they
exist at the Effective Time, shall pass to and vest in the Surviving
Corporation without any conveyance or other transfer and the Surviving
Corporation shall be responsible for all liabilities of Bancorp. At any time
after the Effective Time the officers of the Surviving Corporation may, in
the name of Bancorp, execute and deliver all such deeds, assignments and
other instruments and take or cause to be taken all actions as the Surviving
Corporation may deem necessary or desirable in order to vest, perfect or
confirm in the Surviving Corporation title to and possession of all of
Bancorp's property, rights, privileges, immunities, powers, purposes and
otherwise to carry out the purposes of this Agreement.
Section 1.06. Closing. The closing of the transactions
contemplated by this Agreement shall be effected as promptly as practicable
within the thirty-day period commencing with the latest of the following
dates (the "Closing"):
(a) The 30th calendar day after the date of approval by
the Board of Governors of the Federal Reserve System (the "Federal Reserve
Board");
(b) Such date as may be prescribed by the Wisconsin Office
of the Commissioner of Banking (the "Commissioner of Banking"), the Federal
Deposit Insurance Corporation (the "FDIC") or any other agency or authority
from which approval must be received prior to the consummation of the
transactions contemplated herein; or
<PAGE>
(c) If the transactions contemplated herein are being
contested in any legal proceeding, and the Corporation has elected to contest
the same, then the date that such legal proceeding has been brought to a
conclusion favorable, in the judgment of the Corporation, to the consummation
of the transaction contemplated hereby.
The Closing shall take place at the offices of counsel to the Corporation,
780 North Water Street, Milwaukee, Wisconsin, or at such other place as shall
be mutually agreeable to the Corporation and Bancorp.
ARTICLE II
STATUS AND CONVERSION OF SECURITIES
Section 2.01. Capital Stock of Interim. Each share of common
stock of Interim issued and outstanding as of the Effective Time shall remain
outstanding and shall be owned by the Corporation and such shares shall not
be changed or converted by the Merger. The parties acknowledge that the
Corporation contemplates the liquidation and dissolution of the Surviving
Corporation by means of an upstream merger of the Surviving Corporation with
and into the Corporation, whereupon Bank shall become a direct, wholly-owned
subsidiary of the Corporation.
Section 2.02. Conversion of Bancorp Stock. Subject to the
conditions and limitations set forth in this Agreement, at the Effective
Time, by virtue of the Merger and without any action on the part of any
holder of shares of Bancorp Stock:
(a) All Bancorp Stock owned by Bancorp shall be cancelled
and no M&I Stock or cash shall be delivered in exchange therefor;
(b) Each outstanding share of Bancorp Stock as to which
shareholders have validly perfected dissenter's rights in accordance with
applicable Wisconsin law shall not be converted into and shall not become M&I
Stock hereunder (hereinafter, the "Dissenting Shares"), and Bancorp shall
give the Corporation prompt notice of any written notice from any shareholder
of Bancorp objecting to the Merger (the "Dissenting Shareholders"). Prior to
the Effective Time, Bancorp shall not, except with prior written consent of
the Corporation, voluntarily make any payment with respect to or settle or
offer to settle any such objection. Each Dissenting Shareholder who becomes
entitled, pursuant to the provisions of applicable law, to payment for
Bancorp Stock shall receive payment therefor from the Surviving Corporation
from (i) the Surviving Corporation's assets or (ii) funds provided by the
Corporation dependent on which method would preserve the character of the
overall transaction as a reorganization under Section 368(a)(1)(C) of the IRC
(but only after the amount thereof shall have been agreed upon or finally
determined pursuant to the provisions of the laws of the State of Wisconsin)
and such shares of Bancorp Stock shall be cancelled. If any Dissenting
Shareholder shall fail to perfect or shall effectively withdraw or lose the
right to appraisal of payment for shares of Bancorp Stock under applicable
law, such shares shall be thereupon converted into M&I Stock in accordance
with the provisions of Sections 2.02 and 2.03 hereof; and
<PAGE>
(c) Each share of Bancorp Stock (except shares described
in subparagraph (a) hereof and Dissenting Shares) issued and outstanding as
of the Effective Time shall by virtue of the Merger and without any action on
the part of the holder thereof be converted into the right to receive Three
Hundred Five and Eighty-Five One Hundredths (305.85) shares of M&I Stock.
Section 2.03. No Fractional Shares. No fractional shares of M&I
Stock shall be issued upon the surrender for exchange of certificates; no
dividend or distribution with respect to M&I Stock shall be payable on or
with respect to any fractional share; and no fractional share interest shall
entitle the owner thereof to any rights of a shareholder of the Corporation.
In lieu of any such fractional share, the Corporation shall pay to each
former shareholder who otherwise would be entitled to receive a fractional
share of M&I Stock an amount in cash determined by multiplying the closing
sales price of M&I Stock as reported in the Midwest Edition of the Wall
Street Journal on the Effective Date by the fraction of a share of M&I Stock
to which such holder would otherwise be entitled.
Section 2.04. Payment of Merger Consideration.
(a) As soon as practicable after the Effective Time, the
Corporation shall make available to Interim, which in turn shall make
available to M&I Marshall & Ilsley Bank or other financial institution which
shall be designated by the Corporation as Exchange Agent (the "Exchange
Agent") certificates representing the shares of M&I Stock into which Bancorp
Stock shall be converted pursuant to Section 2.02. The Corporation also
shall make available to Interim at the Effective Time, which in turn shall
make available to the Exchange Agent, the cash necessary to make all required
payment for fractional shares pursuant to Section 2.03, above.
(b) As soon as practicable after the Effective Time, the
Exchange Agent will send a notice and transmittal form to each holder of a
certificate which formerly represented Bancorp Stock prior to the Merger,
advising such holder of the terms of the exchange effected by the Merger and
the procedure for surrendering to the Exchange Agent such certificate for
exchange into one or more certificates evidencing shares of M&I Stock and/or
cash (as to fractional or Dissenting Shares). Until so surrendered, each
outstanding certificate will be deemed for all purposes to evidence the right
to receive cash (as to fractional or Dissenting Shares) and/or the ownership
of the number of full shares of M&I Stock as provided herein; provided,
however, that until such certificates are so surrendered, no dividend payable
to holders of record of shares of M&I Stock as of any date subsequent to the
Effective Time shall be paid to the holder or holders of such certificates in
respect to M&I Stock represented thereby. After the Effective Time, there
shall be no further registry of transfers on the records of Bancorp of
Bancorp Stock and, if a certificate representing such Bancorp Stock is
presented to the Surviving Corporation for transfer, it shall be cancelled
and exchanged for a check in the appropriate amount and/or a certificate
representing the appropriate number of shares of M&I Stock as herein
provided. Upon surrender of certificates for Bancorp Stock which have been
<PAGE>
converted into shares of M&I Stock, there shall be paid (without interest) to
the record holder of the certificates for M&I Stock issued and exchanged
therefor: (i) on or as soon as practicable after such date of surrender, the
amount of dividends which as of any date subsequent to the Effective Time
became payable and were not paid to such holder with respect to such shares
of M&I Stock; and (ii) on the appropriate payment date occurring subsequent
to the date of surrender, the amount of such dividends, if the record date in
respect thereof occurred after the Effective Time but prior to the date of
surrender. Notwithstanding any provision of this Agreement, neither the
Exchange Agent nor any person, firm or entity shall be liable or obligated to
any former holder of any share of Bancorp Stock (or to anyone claiming
through any such former holder) with respect to any M&I Stock, or dividends
thereon, or with respect to any cash to which any such holder would be
entitled as a consequence of the Merger, if such M&I Stock, dividends or cash
have been paid, or are payable, to any public official pursuant to any
abandoned property, escheat or similar laws.
Section 2.05. Certificates in Other Names. A certificate
evidencing shares of M&I Stock in a name other than that in which the
certificate surrendered and exchanged is registered may be issued if the
certificate so surrendered shall be properly endorsed, with signatures
guaranteed by a commercial bank or a firm having membership on a national
securities exchange, or otherwise in proper form for transfer, and the person
requesting such exchange shall pay to the Exchange Agent any transfer or
other taxes required by reason of the issuance of its certificate for shares
of M&I Stock to any person other than the registered holder of the
certificate surrendered or establish to the satisfaction of the Exchange
Agent that such tax has been paid or is not applicable.
Section 2.06. Anti-Dilution Adjustment. If, subsequent to the
date hereof and prior to the Effective Time, the Corporation shall pay a
dividend or make a distribution on M&I Stock in shares of M&I Stock or any
security convertible into M&I Stock or shall combine or subdivide its stock,
then in each such case, from and after the record date for determining the
shareholders entitled to receive such dividend or distribution or the
securities resulting from such combination or subdivision, an appropriate
adjustment shall be made to the conversion ratio set forth in Section 2.02
hereof, for purposes of determining the number of shares of M&I Stock into
which Bancorp Stock shall be converted. For the purpose hereof, the payment
of a dividend in or distribution on M&I Stock in securities convertible into
M&I Stock shall be deemed to have effected an increase in the number of
outstanding shares of M&I Stock equal to the number of shares of M&I Stock
into which such securities shall be initially convertible without the payment
by the holder thereof of any consideration other than the surrender for
cancellation of such convertible securities. Notwithstanding the foregoing,
this Section shall not apply to any stock options issued under option plans
of the Corporation whether or not authorized as of the date of this
Agreement.
<PAGE>
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BANCORP AND BANK
Bancorp hereby represents and warrants to the Corporation, on
behalf of both Bancorp and Bank, as follows:
Section 3.01. Organization. Bancorp is a Wisconsin corporation
duly organized, validly existing and in active status under the laws of the
State of Wisconsin, and is a registered bank holding company under Bank
Holding Company Act of 1956. The sole subsidiary of Bancorp, Citizens Bank
of Delavan (the "Bank"), is a bank duly organized, validly existing and in
good standing under the laws of the state of Wisconsin. Both Bancorp and
Bank have the corporate power and authority and have received all necessary
material federal, state or local authorizations to own or lease their
properties and assets and to carry on their businesses as now conducted and
presently proposed to be conducted. The copies of the Articles of
Incorporation and By-Laws of Bancorp and Bank, certified by their Secretary
and Cashier, respectively, as of the date of this Agreement and which have
been delivered to the Corporation, are correct and complete copies of the
Articles of Incorporation and By-Laws of Bancorp and Bank in effect as of the
date of this Agreement. As of the date of this Agreement, the minute books
of Bancorp and Bank contain complete and accurate records of all meetings and
other corporate actions of their respective shareholders and Boards of
Directors (including committees of the Boards of Directors). Both Bancorp
and Bank are duly qualified to conduct their businesses and are in good
standing in each jurisdiction in which the nature of the business transacted
requires such qualification, except those jurisdictions in which the failure
to so qualify does not involve the violation of a criminal statute, affect
the validity or enforceability of a contract in any material respect or
otherwise have a material adverse effect on Bancorp or Bank.
Section 3.02. Capitalization. The authorized capital stock of
Bancorp consists of 4,000 shares of common stock, $100.00 par value, of
which 3,703 shares are issued and outstanding as of the date of this Agreement
and all of which shares are validly issued and outstanding, fully paid, non-
assessable (except as otherwise provided by applicable law), and have not
been issued in violation of the preemptive rights of any stockholder. The
authorized capital stock of Bank consists of 4,000 shares of common stock,
$100.00 par value, all of which are owned by Bancorp. All of such shares are
validly issued and outstanding, fully paid, non-assessable (except as
otherwise provided by applicable law), and have not been issued in violation
of the preemptive rights of any stockholder. There are no outstanding or
existing options, preemptive rights, warrants, subscriptions, conversion
rights, calls or commitments of any kind obligating Bancorp or Bank to issue,
directly or indirectly, additional shares of any class of capital stock.
Bancorp and Bank have no outstanding commitments or obligations to
repurchase, reacquire or redeem any of their outstanding capital stock.
<PAGE>
Section 3.03. Authority and Validity of Agreement. Bancorp has
full corporate power and authority to enter into this Agreement, the Merger
Agreement and to consummate the transactions contemplated herein and therein.
The execution, delivery and performance of this Agreement and the Merger
Agreement by Bancorp have been duly authorized by all requisite corporate
action, including without limitation approval by Bancorp's Board of
Directors, subject only to approval by the holders of the requisite
percentage of the outstanding shares of Bancorp Stock. Subject to such
approval by its shareholders and the government approvals described below,
this Agreement and, upon execution and delivery, the Merger Agreement, each
will constitute a valid and binding obligation of Bancorp, enforceable in
accordance with its terms, except as such terms may be affected by
bankruptcy, insolvency, moratorium and similar laws affecting the rights of
creditors generally and by the availability of equitable remedies. Provided
the required approvals are obtained from the Federal Reserve Board and the
offering, sale and delivery of the M&I Stock to be issued hereunder (and
under the Merger Agreement) are duly registered pursuant to the Securities
Act of 1933 (the "1933 Act"), as amended, and Rule 145 of the General Rules
and Regulations thereunder ("Rule 145"), and subject to the rights of any
Dissenting Shareholders, neither the execution, delivery and performance of
either this Agreement or the Merger Agreement nor the consummation of the
transactions contemplated herein and therein, will conflict with, result in
the material breach of, constitute a default under or accelerate the
performance provided by, the terms of any law, or any rule or regulation of
any government agency or authority or any judgment, order or decree of any
court or other government agency to which Bancorp or Bank may be subject, any
contract, agreement or instrument to which Bancorp or Bank is a party or by
which Bancorp or Bank is bound or committed or the Articles of Incorporation
or By-Laws of Bancorp or Bank, or constitute an event which with the lapse of
time or action by a third party could result in the creation or imposition of
any lien, charge or encumbrance upon any of the assets or properties of
Bancorp or Bank or upon any of the capital stock of Bancorp or Bank.
Section 3.04. Financial Statements.
(a) Bancorp has heretofore delivered to the Corporation
correct and complete copies of:
(i) Bancorp's and Bank's unaudited financial
statements (including, in each case, any related notes thereto), certified by
the Secretary and Cashier of the Bancorp and the Bank, respectively,
including Balance Sheets for Bancorp as of December 31, 1992, December 31,
1993, and the period from January 1, 1994 to June 30, 1994, and its unaudited
Statements of Earnings, Shareholders' Equity and Changes in Financial
Position for the same periods; Call Reports and unaudited Statements of
Condition for Bank as of December 31, 1992, December 31, 1993, and the period
from January 1, 1994 to June 30, 1994, and its unaudited Statements of
Income, Changes in Financial Position and Statements of Shareholders' Equity
for the same period; and
<PAGE>
(ii) Copies of all management and other letters
delivered to Bancorp or Bank by Bancorp's or Bank's independent auditors, of
the internal controls of Bancorp during the period January 1, 1991 to date,
and will, upon reasonable request, make available for inspection at such time
and place as the Corporation may request, reports and working papers produced
or developed by Bancorp's independent auditors in connection with their
examination of such financial statements, as well as all such reports and
working papers for prior periods for which any tax or other liability of
Bancorp has not been finally determined or barred by applicable statute of
limitations.
(b) The financial statements, Call Reports and management
and other letters described in subsections (a) and (b) above fairly present
as of their respective dates the financial positions of Bancorp and Bank as
of the dates thereof and the results of operations for the periods indicated,
and each such statement has been, and shall have been, prepared in accordance
and compliance with all standards and instructions of the Federal Reserve
Board, as to Bancorp's financial statements, FDIC, as to Bank's financial
statements and Call Reports (the "Regulatory Accounting Standards"), and in
conformity with generally accepted accounting principles applied on a con-
sistent basis, except as otherwise stated, and except that any unaudited
interim statements are subject to normal year-end audit adjustments which
shall not be materially adverse.
(c) The financial statements described in Subsection (a)
above, do not, as of the dates thereof, include any material assets or omit
to state any material liability, absolute or contingent, or other facts, the
inclusion or omission of which renders such financial statements, in light of
the circumstances under which they were made, materially misleading.
Section 3.05. Reserves for Possible Loan Losses. The reserves
for possible loan and lease losses shown on Bank's Call Report filed as of
June 30, 1994, are to the best knowledge of Bancorp and Bank adequate in all
respects to provide for all losses, and net of recoveries relating to loans
previously charged off, on loans outstanding as of the date of such state-
ment, and the loan portfolios of Bank at such dates in excess of such
reserves are all fully collectible in accordance with their terms.
Section 3.06. Absence of Certain Changes or Events. Except as
has been disclosed in Exhibit C hereto (the "Disclosure Schedule"), since
January 1, 1994, there has not been any material adverse change in the
business, properties or financial condition of Bancorp or Bank nor any
development involving a prospective change in Bancorp's or Bank's business,
which has affected or may affect materially and adversely the businesses,
properties or financial condition or the results of operations of Bancorp or
Bank and Bancorp and Bank have conducted their business only in the ordinary
course consistent with past practice.
Section 3.07. Title. Bancorp and Bank have good and marketable
title to all assets and properties, whether real or personal, tangible or
intangible, which it purports to own, including without limitation, all
assets and properties reflected in the most recent financial statements
referred to in Section 3.04(a) hereof, or acquired subsequent thereto (except
to the extent such assets and properties have been disposed of for fair value
in the ordinary course of business since the date of such financial
<PAGE>
statements), subject to no liens, mortgages, security interests, encumbrances
or charges of any kind except: (i) as noted in said financial statements or
the notes thereto; (ii) statutory liens not yet delinquent; (iii) security
interests granted incident to borrowings by Bank from the Federal Reserve
Banks or to secure deposits of funds by federal, state or other governmental
agencies; (iv) minor defects and irregularities in title and encumbrances
which do not materially impair the use thereof for the purposes for which
they are held; (v) liens in connection with repurchase agreements and any
other liens incurred in the ordinary course of business; and (vi) such liens,
mortgages, security interests, encumbrances and charges as are not, in the
aggregate, material to the assets and properties of Bancorp or Bank. The
Disclosure Schedule sets forth a list of all material leases pursuant to
which Bancorp or Bank leases real or personal property. All such leases are
valid, binding and enforceable in accordance with their terms, and are in
full force and effect, and there are no existing defaults by Bancorp or Bank
thereunder or (to the best of the knowledge of Bancorp) any other party
thereto; and no event has occurred which (whether with or without notice,
lapse of time or both) would constitute a default thereunder. True and
correct copies of such leases have been delivered to the Corporation. None
of the buildings, structures or appurtenances described in the Disclosure
Schedule or the operation or maintenance thereof as now operated or
maintained, contravenes any zoning ordinance or other administrative
regulation (whether or not permitted because of prior non-conforming use) or
violates any restrictive covenant or any provision of law, the effect of
which would materially interfere with or prevent the continued use of such
properties for the purposes for which they are now being used or would
materially and adversely affect the value thereof.
Section 3.08. Litigation. Except as set forth in the Disclosure
Schedule hereto, no claims have been asserted and no relief has been sought
against Bancorp or Bank in any pending litigation or government proceedings
(including without limitation any notice of possible violation or non-
compliance with any environmental law, rule or regulation) or otherwise which
might result in a judgment, decree or order having a material adverse effect
on the financial condition, results of operations, assets, business or
prospects of Bancorp or Bank. To the best of Bancorp's knowledge there is no
reasonable basis for any material proceedings, claims, actions or government
investigation (including without limitation any notice of possible violation
or non-compliance with any environmental law, rule or regulation). Neither
Bancorp nor Bank is a party to any order, judgment or decree which will, or
might reasonably be expected to have, a material adverse effect on its
business, operations, assets, financial condition or prospects.
Section 3.09. Compliance with Laws. Bancorp and Bank have all
permits, licenses, certificates of authority, orders and approvals of, and
has made all filings, applications and registrations with federal, state or
local government or regulatory bodies that are required in order to permit
them to carry on their business as presently conducted and the absence of
which would have a material adverse effect on such business. All such
permits, licenses, certificates of authority, orders and approvals are in
<PAGE>
full force and effect, to the knowledge of Bancorp, no suspension or
cancellation of any of them is threatened; and all such filings, applications
and registrations are current in all material respects. Bancorp and Bank are
not in default under any order, license, regulation or demand of any federal,
state, local or other government agency or with respect to any order, writ,
injunction or decree of any court, in each case which violation, infringement
or default would have a material adverse effect on the financial condition,
results of operations, business or prospects of Bancorp or Bank.
Section 3.10. Taxes. Bancorp and Bank have filed with the
appropriate government agencies all federal, state and local income,
franchise, excise, real and personal property and other tax returns and
reports which are required to be filed by it and Bancorp and Bank are not
delinquent in the payment of any taxes shown on such returns or reports or on
any assessments for any such taxes received by it. The tax and audit
positions taken by Bancorp and Bank in connection with the tax returns
described in this section were reasonable and asserted in good faith. To
Bancorp's knowledge, there are no examinations by the Internal Revenue
Service or the Wisconsin Department of Revenue for any years pending with
respect to Bancorp. The Disclosure Schedule sets forth the date or dates
through which the Internal Revenue Service and the Wisconsin Department of
Revenue, respectively, have examined the income tax returns of Bancorp or
Bank. There are included in the most recent financial statements (or the
notes thereto) referred to in Section 3.04(a) hereof, adequate reserves for
the payment of all accrued but unpaid federal, state and local taxes of
Bancorp and Bank including interest and penalties, whether or not disputed,
for the period ended as of the date of such statements and for all fiscal
periods prior thereto. Neither Bancorp nor Bank has executed or filed with
the Internal Revenue Service any agreement extending the period for
assessment and collection of any federal or state tax, nor is Bancorp or Bank
a party to any action or proceeding by any government authority for
assessment or collection of taxes, nor has any claim for assessment or
collection of taxes been asserted against Bancorp or Bank.
Section 3.11. Employment Contracts and Benefits; Material
Contracts. Except as disclosed in the Disclosure Schedule, there are no: (i)
employment, severance, consulting or other compensation agreements between
Bancorp or Bank and any officer, director or employee of Bancorp or Bank; and
neither Bancorp nor Bank is a party to or bound by any written or oral
employment contract (including without limitation, any collective bargaining
contract or union agreement) which is not terminable without penalty by
Bancorp or Bank on sixty days' or less notice; (ii) bonus, profit-sharing,
severance, termination, stock option, pension, retirement, deferred or
contingent compensation or other employee benefit agreements, trusts, plans
or other arrangements for the benefit of any director, officer or employee of
Bancorp or Bank; (iii) material leases or licenses with respect to any
property, real or personal, whether as landlord, tenant, licensor or
licensee; (iv) contracts or commitments for capital expenditures in excess of
$50,000 for any one project; (v) material contracts or commitments made in
the ordinary course of business for the purchase of materials or supplies or
for the performance of services over a period of more than sixty days from
<PAGE>
the date of this Agreement; or (vi) contracts or options to purchase or sell
any real or personal property otherwise than in the ordinary course of
business. Bancorp and Bank have in all material respects performed all
obligations required to be performed by them to date and are not in default
under any outstanding indenture, mortgage, contract, lease or other agreement
to which they are a party or by which they are bound or under any provision
of its Articles of Incorporation or By-Laws, which might result in, or have
consequences which might result in, a material adverse effect on the
financial condition, results of operations, assets, business or prospects of
Bancorp or Bank.
Section 3.12. Employee Benefit Plans.
(a) Existence of Plans. The Disclosure Schedule lists all
employee benefit plans (as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and all bonus, stock
option, stock purchase, restricted stock, incentive, deferred compensation,
retiree medical or life insurance, supplemental retirement, severance or
other benefit plans, programs or arrangements, and all material employment,
termination, severance or other employment contracts or employment
agreements, with respect to which Bancorp or Bank has any obligation (collec-
tively, the "Plans"). Bancorp has furnished or made available to the
Corporation a complete and accurate copy of each Plan (or a description of
the Plans, if the Plans are not in writing) and a complete and accurate copy
of each material document prepared in connection with each such Plan,
including, without limitation and where applicable, a copy of: (i) each trust
or other funding arrangement; (ii) each summary plan description and summary
of material modifications; (iii) the most recently filed Internal Revenue
Service ("IRS") Form 5500 and related schedules; (iv) the most recently
issued IRS determination letter for each such Plan; and (v) the most recently
prepared actuarial report and financial statement in connection with each
such Plan.
(b) Absence of Certain Types of Plans. Neither Bancorp
nor Bank maintains or contributes to, or within the five years preceding the
Effective Time has not maintained or contributed to, an employee pension
benefit plan subject to Title IV of ERISA. Except as listed on the
Disclosure Schedule, none of the Plans obligates Bancorp or Bank to pay
material separation, severance, termination or similar-type benefits solely
as a result of any transaction contemplated by this Agreement or as a result
of a "change in control," within the meaning of such term under Section 280G
of the Code. Except as listed in the Disclosure Schedule or as required by
COBRA, none of the Plans provides for or promises retiree medical, disability
or life insurance benefits to any current or former employee, officer or
director of Bancorp or Bank.
(c) Compliance with Applicable Law. Except as listed on
the Disclosure Schedule, each Plan has been operated in all respects in
accordance with the requirements of all applicable Law and all persons who
participate in the operation of such Plans and all Plan "fiduciaries" (within
the meaning of Section 3(21) of ERISA) have acted in accordance with the
<PAGE>
provisions of all applicable Law, except where such violations of applicable
Law would not, individually or in the aggregate, have a material adverse
effect on Bancorp. Bancorp and Bank have performed all obligations required
to be performed by any of them under, are not in any respect in default under
or in violation of, and neither Bancorp nor Bank has knowledge of any default
or violation by any party to, any Plan, except where such failures, defaults
or violations would not, individually or in the aggregate, have a material
adverse effect on Bancorp. No legal action, suit or claim is pending or
threatened with respect to any Plan (other than claims for benefits in the
ordinary course) and, except as disclosed in the Disclosure Schedule, to the
knowledge of Bancorp no fact or event exists that could give rise to any such
action, suit or claim. Except as listed on the Disclosure Schedule, neither
Bancorp nor Bank has incurred any material liability to the Pension Benefit
Guaranty Corporation or any material "withdrawal liability" within the
meaning of Title IV of ERISA.
(d) Qualification of Certain Plans. Each Plan that is
intended to be qualified under Section 401(a) of the Code or Section 401(k)
of the Code has received a favorable determination letter from the IRS (as
defined herein) that it is so qualified, and each trust established in
connection with any Plan that is intended to be exempt from federal income
taxation under Section 501(a) of the Code is so exempt, and no fact or event
has occurred since the date of such determination letter from the IRS to
adversely affect the qualified status of any such Plan or the exempt status
of any such trust. Except as disclosed on the Disclosure Schedule, no trust
maintained or contributed to by Bancorp or Bank is intended to be qualified
as a voluntary employees' beneficiary association or is intended to be exempt
from federal income taxation under Section 501(c)(9) of the Code.
(e) Absence of Certain Liabilities and Events. Except for
matters listed on the Disclosure Schedule, there has been no prohibited
transaction (within the meaning of Section 406 of ERISA or Section 4975 of
the Code) with respect to any Plan. Neither Bancorp nor Bank has incurred
any liability for any excise tax arising under Section 4972 or 4980B of the
Code and to the knowledge of Bancorp and Bank no fact or event exists that
could give rise to any such liability.
(f) Plan Contributions. All contributions, premiums or
payments required to be made with respect to any Plan have been made on or
before their due dates.
Section 3.13. Conduct. Except as set forth in the Disclosure
Schedule hereto, since December 31, 1993 neither Bancorp nor Bank has: (i)
declared or set aside or paid any dividend or other distribution in respect
of its capital stock, or directly or indirectly, purchased, redeemed or
otherwise acquired any shares of such stock; (ii) incurred any obligations or
liabilities (absolute or contingent), or mortgaged, pledged or subjected to
liens or encumbrances (other than statutory liens not yet delinquent) any of
its assets or properties, except certificates of deposit, repurchase
agreements, letters of credit, cashier's checks, borrowings from the Federal
Reserve Banks, and obligations and liabilities incurred in the ordinary
<PAGE>
course of business, discharged or satisfied any lien or encumbrance or paid
any obligation or liability (absolute or contingent), other than current
liabilities included in the financial statements, current liabilities
incurred since the date thereof in the ordinary course of business and
liabilities incurred in carrying out the transaction contemplated by this
Agreement; (iii) sold, exchanged or otherwise disposed of or acquired assets
other than in the ordinary course of business; (iv) made any general wage or
salary increase to its employees as a class, or to any executive officer or
director, entered into or amended any employment contract, severance or
similar agreement or arrangement with any officer or salaried employee or
established any new or modified or amended any existing employee welfare,
bonus, stock option, profit-sharing, retirement or other employee benefit
plan or arrangement; (v) suffered any damage, destruction or loss, whether or
not covered by insurance, materially and adversely affecting their business,
properties or assets or waived any rights of value which in the aggregate are
material; (vi) except in the ordinary course of business, entered or agreed
to enter into any agreement or arrangement granting any preferential rights
to purchase any of its assets, properties or rights or requiring the consent
of any party to the transfer and assignment of any such assets, properties or
rights; or (vii) entered into any transactions outside the ordinary course of
business except as expressly contemplated by this Agreement.
Section 3.14. Continuity of Interest. To the best of Bancorp's
knowledge, there is no plan or intention on the part of Bancorp's
shareholders to sell, exchange or otherwise dispose of a number of shares of
the M&I Stock to be received by them in the Merger which would reduce the
holdings of such M&I Stock to a number of shares having, in the aggregate, a
value at the time of the Merger of less than 50% of all capital stock of
Bancorp outstanding prior to the Merger. For purposes of this represen-
tation, shares of Bancorp stock exchanged for cash or other property,
surrendered by dissenters, or exchanged for cash in lieu of fractional shares
of M&I Stock will be treated as outstanding Bancorp stock on the date of the
Merger. Moreover, shares of Bancorp stock and shares of M&I Stock held by
Bancorp shareholders and otherwise sold, redeemed, or disposed of prior or
subsequent to the Merger will be considered in making this representation.
Section 3.15. Approval by Bancorp Board; Recommendation to
Bancorp Shareholders. The Board of Directors of Bancorp has determined that
this Agreement, the Merger and the other transactions contemplated hereby are
fair to the shareholders of Bancorp and recommended that the shareholders of
Bancorp authorize and approve this Agreement, the Merger Agreement and the
transactions contemplated herein (the "Board Resolutions"); the Board
Resolutions are in full force and effect, have not been withdrawn, modified,
amended or rescinded in any respect prior to the date hereof and will not be
withdrawn, modified, amended or rescinded in any respect prior to the
Effective Time; and the affirmative votes of only a majority of the
outstanding shares of Bancorp Stock are required to authorize and approve
this Agreement, the Merger Agreement and the transactions contemplated herein
and therein.
<PAGE>
Section 3.16. Insurance. To the best of Bancorp's knowledge,
Bancorp and Bank have in effect insurance coverage with reputable insurers,
which in respect to amounts, types and risks insured, is adequate for
companies of comparable size engaged in business similar to that in which
Bancorp and Bank are engaged. A schedule of all insurance policies in effect
as to Bancorp and Bank is set forth in the Disclosure Schedule. All material
policies of fire, product or other liability, worker's compensation and other
similar forms of insurance owned or held by Bancorp and Bank are in full
force and effect, all premiums with respect thereto covering all periods up
to and including the date as of which this representation is being made have
been paid and no notice of cancellation or termination has been received with
respect to any such policy. Such policies are valid, outstanding and
enforceable policies, and will not in any way be affected by, or terminate or
lapse by reason of, the transactions contemplated by this Agreement.
Section 3.17. Absence of Adverse Agreements. Neither Bancorp
nor Bank is a party to any agreement or instrument or any judgment, order or
decree or any rule or regulation of any court or other government agency or
authority which materially and adversely affects or in the future may, to the
best knowledge of Bancorp, materially and adversely affect the financial
condition, results of operations, assets, business or prospects of Bancorp or
Bank.
Section 3.18. Disclosure. No representation or warranty made by
Bancorp or Bank contained in this Agreement and no statement contained in any
certificate, list, exhibit or other instrument specified in this Agreement,
whether heretofore furnished to the Corporation or hereafter required to be
furnished to the Corporation, contains or will contain any untrue statement
of a material fact or omits or will omit to state a material fact necessary
to make the statements contained therein not misleading.
Section 3.19. Internal Controls and Records. Bank maintains
books of account which accurately and validly reflect, in all material
respects, all loans, mortgages, collateral and other business transactions
and maintains accounting controls sufficient to ensure that all such
transactions are (i) in all material respects, executed in accordance with
its management's general or specific authorization, and (ii) recorded in
conformity with generally accepted accounting principles. There is no
amendment to any lending agreement, collateral document or security which is
not fully reflected in Bank's books and records.
Section 3.20. Loan Schedule. The Disclosure Schedule contains a
Loan Schedule identifying certain loan agreements, notes and borrowing
arrangements between Bank and its borrowers. Except as specifically noted on
the Loan Schedule: (i) as of the date of this Agreement, Bank is not a party
to any written or oral loan agreement, note or borrowing arrangement under
the terms of which the obligor is 30 days or more delinquent in payment of
principal or interest or, to the best of Bancorp's or Bank's knowledge, in
default of any other provision as of the dates shown thereon other than loans
the unpaid balance of which does not exceed $10,000 per loan; (ii) as of the
date of this Agreement Bank is not a party to any written or oral loan
agreement, note or borrowing arrangement which has been classified as
"substandard," "doubtful," "loss," "other loans especially mentioned" or any
comparable classifications by Bank, FDIC or Commissioner of Banking; (iii) as
of the date of this Agreement Bank is not a party to any written or oral loan
agreement, note, or borrowing arrangement, including any loan guaranty, with
any director, executive officer or ten percent shareholder of Bancorp, or any
person, corporation or enterprise controlling, controlled by or under common
control with any of the foregoing; or (iv) as of the date of this Agreement,
to the best of Bancorp's and Bank's knowledge, Bank is not a party to any
written or oral loan agreement, note or borrowing arrangement in violation of
any law, regulation or rule of any governmental authority and which violation
could affect Bancorp or Bank in a materially adverse manner.
Section 3.21. Brokers. Neither Bancorp, Bank nor any of their
officers and directors have engaged any broker or finder or incurred any
liability for any brokerage fees, commissions or finder's fees in connection
with the Merger or the transactions contemplated herein. Bancorp agrees to
indemnify the Corporation against any claim by any third person for any
commission, brokerage or finder's fee, or other payment with respect to this
Agreement, the Merger Agreement or the transactions contemplated herein and
therein based on any alleged agreement or understanding between such party
and such third person, whether express or implied from the actions of such
party.
Section 3.22. Environmental Matters.
(a) To the best of Bancorp's and Bank's knowledge and
except as disclosed in the Disclosure Schedule: (i) Hazardous Materials (as
defined below) have not been stored, released or disposed of on or from
Bancorp's or Bank's Property (as defined below) or, to the actual knowledge
of Bancorp, any property adjoining Bancorp's or Bank's Property; (ii)
Environmental Permits (as defined below) have been obtained and are in effect
for the operations conducted at Bancorp's or Bank's Property; (iii) Bancorp
and Bank are in compliance in all material respects with the requirements of
all of their Environmental Permits; and (iv) there are no circumstances with
respect to any Bancorp or Bank Property that could reasonably be anticipated
to form the basis of an Environmental Claim against Bancorp, Bancorp's
Property, the Bank or Bank's Property that, individually or in the aggregate,
could have a material adverse effect on Bancorp or Bank, taken as a whole, or
to cause Bancorp's or Bank's Property to be subject to any restrictions on
ownership, occupancy, use or transferability under any applicable Environ-
mental Law.
(b) As used herein, the following terms shall be defined
as follows:
(i) "Bancorp's Property" or the "Bank's Property"
means any real property and improvements currently owned, leased, used,
operated or occupied by Bancorp or Bank, including properties acquired by
foreclosure or held or operated in a fiduciary or managerial capacity;
<PAGE>
(ii) "Hazardous Materials" means (A) any petroleum
or petroleum products, radioactive materials, asbestos in any form that is or
could become friable, urea formaldehyde foam insulation, transformers or
other equipment that contain dielectric fluid containing levels of
polychlorinated biphenyls and radon gas; (B) any chemicals, materials or
substances defined as or included in the definition of "hazardous sub-
stances," or words of similar import, under any applicable Environmental Law;
and (C) any other chemical, material or substance, exposure to which is
prohibited, limited or regulated by any governmental authority;
(iii) "Environmental Law" means any federal,
state, local or foreign statute, law, rule, regulation, ordinance, code,
policy or rule of common law in effect and in each case as amended as of the
Effective Time, and any judicial or administrative interpretation thereof as
of the Effective Time, including any judicial or administrative order,
consent decree or judgment, relating to the environment, health, safety or
Hazardous Materials;
(iv) "Environmental Claims" means any and all
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation, investigations
or proceedings relating in any way to any Environmental Law or Environmental
Permit; and
(v) "Environmental Permits" means all permits,
approvals, identification numbers, licenses and other authorizations required
under any applicable Environmental Law.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
The Corporation represents and warrants as follows:
Section 4.01. Organization. The Corporation is a corporation
validly existing and in active status under the laws of the State of
Wisconsin with all necessary power to carry on its business as it is now
being conducted. The Corporation is a registered bank holding company under
Bank Holding Company Act of 1956, as amended.
Section 4.02. Capitalization. The outstanding capital stock of
the Corporation is, and the shares of M&I Stock to be issued pursuant to this
Agreement and the Merger Agreement, when so issued, will be, duly authorized,
validly issued, fully paid and non-assessable (except as provided by
applicable law) and have not, and will not have, been issued in violation of
the preemptive rights of any person.
Section 4.03. Filings and Reports. The Corporation has
previously delivered to Bancorp true and complete copies of: (i) its Annual
Report on Form 10-K for the fiscal years ended December 31, 1991, 1992 and
1993, respectively, as filed with the Commission; (ii) Proxy Statements
relating to all meetings of the Corporation's shareholders (whether annual or
special) during 1992, 1993 and 1994; and (iii) all other reports, statements
<PAGE>
and registration statements (including current reports on Form 8-K and
quarterly reports on Form 10-Q) filed by it with the Commission since January
1, 1993 (collectively, the Corporation's "SEC Reports"). As of their
respective filing dates, the Corporation's SEC Reports did not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
made therein, in light of the circumstances under which they were made, not
misleading. The audited and unaudited consolidated financial statements of
the Corporation included in the Corporation's SEC Reports have been prepared
in accordance with generally accepted accounting principles applied on a
consistent basis (except as stated in such financial statements) and fairly
present the financial position of the Corporation and its consolidated
Subsidiaries as of the dates thereof and the results of their operations and
changes in financial position of the Corporation and its consolidated
Subsidiaries for the periods then ended, subject, in the case of the
unaudited financial statements, to normal year-end audit adjustments which
shall not be materially adverse.
Section 4.04. Litigation. No claims have been asserted and no
relief has been sought against the Corporation or any of its Subsidiaries in
any pending litigation or governmental proceedings or otherwise, which might
result in a judgment, decree or order having a material adverse effect on the
financial condition, results of operations, business or prospects of the
Corporation and its consolidated Subsidiaries, taken as a whole, or on the
transactions proposed by this Agreement.
Section 4.05. Authority and Validity of Agreement. The
Corporation has full corporate power and authority to enter into this
Agreement and the Merger Agreement and to consummate the transactions
contemplated herein and therein. The execution, delivery and performance of
this Agreement by the Corporation have been duly authorized by all requisite
corporate action. Subject to the government approvals described below, this
Agreement will constitute a valid and binding obligation of the Corporation,
enforceable in accordance with its terms, except as such terms may be
affected by bankruptcy, insolvency, moratorium and similar laws affecting the
rights of creditors generally and by the availability of equitable remedies.
Provided the required approvals are obtained from the Federal Reserve Board
and the offering, sale and delivery of the M&I Stock to be issued hereunder
(and under the Merger Agreement) are duly registered pursuant to the 1933 Act
and Rule 145 thereunder, neither the execution, delivery and performance of
this Agreement or the Merger Agreement nor the consummation of the Merger
contemplated herein and therein, will conflict with, result in the breach of,
constitute a default under or accelerate the performance provided by, the
terms of any law, or any rule or regulation of any government agency or
authority or any judgment, order or decree of any court or other government
agency to which the Corporation may be subject, any contract, agreement or
instrument to which the Corporation is a party or by which the Corporation is
bound or committed or the Articles of Incorporation or By-Laws of the
Corporation or constitute an event which with the lapse of time or action by
a third party could result in a default under any of the foregoing or result
in the creation or imposition of any lien, charge or encumbrance upon any of
the assets or properties of the Corporation or upon any shares of M&I Stock.
<PAGE>
Section 4.06. Disclosure. No representation or warranty made by
the Corporation contained in this Agreement and no statement contained in any
certificate, list, exhibit or other instrument specified in this Agreement,
whether heretofore furnished to Bancorp or hereafter required to be furnished
to Bancorp, contains or will contain any untrue statement of a material fact
or omits or will omit to state a material fact necessary to make the
statements contained therein not misleading.
ARTICLE V
ADDITIONAL COVENANTS AND AGREEMENTS
Section 5.01. Conduct of Business Prior to Closing. From and
after the date of this Agreement until the Effective Time, Bancorp and Bank
shall: (i) carry on their businesses diligently and in substantially the same
manner as they did prior to the Effective Time; (ii) maintain and keep their
properties in as good repair and condition as at present, except for
depreciation due to ordinary wear and tear and damage due to casualty; (iii)
maintain in full force and effect insurance comparable in amount and in scope
of coverage to that now maintained by them; (iv) perform all of their
obligations under contracts, leases and documents relating to or affecting
their assets, properties and business; (v) maintain and preserve their
business organization intact, retain their present employees and maintain
their relationship with customers; and (vi) comply with and perform all obli-
gations and duties imposed upon them by federal and state laws and all rules,
regulations and orders imposed by federal or state governmental authorities.
Without limiting the generality of the foregoing, except as specifically
contemplated in this Agreement, from the date hereof until the Effective
Time, neither Bancorp nor Bank shall enter into any agreement or otherwise
commit to do, without the written consent of the Corporation, any of the
following:
(a) (i) incur or assume any material obligation or
liability, including without limitation any obligation for borrowed money
whether or not evidenced by a note, bond, debenture or similar instrument,
(ii) assume, guaranty, endorse or otherwise become liable or responsible
(whether directly, contingent or otherwise) for the obligations of any other
person; or (iii) mortgage, license, pledge or grant a security interest in
any of its material assets or allow to exist any material lien thereon;
except (A) for liabilities and obligations (including corporate debt
issuances) incurred in the ordinary course of business consistent with past
practice and in amounts not material to Bancorp; or undertaken in connection
with the capital expenditures otherwise permitted under this section; and (B)
as may be required under existing agreements to which Bancorp or Bank are
parties;
(b) change its lending, investment, liability management
and other material banking policies in any material respect; organize any
Subsidiaries or enter into any new non-banking line of business whether or
not permissible under applicable federal or state law, make any material
changes in its operations or make any material investment in any other
person, firm or entity;
<PAGE>
(c) propose, adopt or permit any amendment to its Articles
of Incorporation or By-Laws or the terms of any securities issued by it;
(d) in an aggregate amount exceeding One Hundred Thousand
Dollars ($100,000.00) authorize, incur or commit to any capital expenditures
other than capital expenditures consistent with the budget heretofore
furnished to and approved by the Corporation;
(e) (i) split, combine or reclassify any Bancorp Stock or
redeem, purchase or otherwise acquire any shares of its capital stock or any
securities or obligations convertible into or exchangeable for any shares of
its capital stock, or any options, warrants, conversion or rights to acquire
any shares of its capital stock or any securities or obligations; (ii) merge
with or into any other corporation or bank, permit any other corporation or
bank to merge into it or consolidate with any other corporation or bank, or
effect any reorganization or recapitalization; (iii) purchase or otherwise
acquire any substantial portion of the assets, or more than 5% of any class
of capital stock, of any corporation, bank or other business; and (iv)
liquidate, sell, dispose of, or encumber any assets other than in the
ordinary course of business consistent with past practice which assets are
not material to Bancorp;
(f) revalue in any material respect any of its assets,
including without limitation the writing down or writing off the value of any
asset; or change its methods of accounting, except as required by changes in
generally accepted accounting principles as concurred in by Arthur Andersen &
Co., or change any of its methods of reporting income and deductions for
Federal income tax purposes, except as required by changes in applicable law;
(g) make any tax election or settle or compromise any
income tax liability material to Bancorp or Bank;
(h) pay, discharge or satisfy any claims, liabilities or
obligations (absolute, accrued, asserted or unasserted, contingent or
otherwise), other than the payment, discharge or satisfaction in the ordinary
course of business of liabilities reflected or reserved against in, or
contemplated by, the consolidated financial statements (or the notes thereto)
of Bancorp or incurred in the ordinary course of business consistent with
past practice;
(i) (i) issue, grant, sell or pledge any shares of its
capital stock or any securities convertible into capital stock, or permit any
shares of its capital stock held in its treasury to become outstanding,
except upon exercise of rights or options outstanding under employee benefit
plans, programs or arrangements in existence on the date hereof; (ii) confer,
issue, sell, grant or award any options, warrants, conversion or other rights
not outstanding on the date hereof to acquire any shares of its capital stock
not outstanding on the date hereof, including without limitation, the issue,
sale, or grant of any option or stock appreciation right; or (iii) amend any
of the terms of any such outstanding securities, options, warrants, rights or
agreements;
<PAGE>
(j) take or suffer to exist any of the actions described
in Section 3.13 hereof;
(k) (i) enter into or adopt any new employee benefit plan
or agreement, or (except as required under existing plans or agreements)
increase in any manner the compensation or benefits of any of its officers,
directors or other employees; (ii) pay or agree to pay any pension,
retirement or severance allowance or other employee benefit not required or
permitted by any existing plan, agreement or arrangement to any director,
officer or key employee; (iii) adopt or commit itself to any additional
pension, profit sharing, bonus, incentive, deferred compensation, insurance,
or other employee benefit plan, agreement or arrangement or to any employment
or consulting agreement with or for the benefit of any director, officer or
employee, except for bonus payments to employees payable in December of 1994
not to exceed $100,000 in aggregate; (iv) amend any such plan, agreement or
arrangement; or (v) enter into any contract, agreement or commitment to do
any of the foregoing; or
(l) declare or pay any dividends on its outstanding shares
of capital stock, except for regular dividends paid in the ordinary course of
business and consistent with past practices of Bancorp.
Section 5.02. Information Requirements. Bancorp shall, between
the date hereof and the Effective Date, deliver to the Corporation complete
copies of:
(a) as soon as practicable, but in no event later than
thirty (30) days after the end of each fiscal year, Bank's Call Reports and
Bancorp's unaudited Balance Sheet as of the last day of such year and its
Statements of Income, Changes in Shareholders' Equity and Changes in
Financial Position for the fiscal year then ended, together with comparable
data relating to the preceding fiscal year, all certified as true and correct
by Bancorp's or Bank's, as the case may be, principal accounting or financial
officer, subject to normal year-end fiscal audit adjustments;
(b) as soon as practicable, but in any event not later
than thirty (30) days after the end of each fiscal quarter commencing with
the quarter ending June 30, 1994, its unaudited Balance Sheet and Bank Call
Reports as of the close of such fiscal quarter and the related unaudited
Statements of Income, Changes in Shareholders' Equity and Changes in
Financial Position for each such fiscal quarter, certified as accurate by
Bancorp's chief financial or accounting officer; and
(c) all management and other letters delivered to Bancorp
or Bank by its independent auditors, and Bancorp will make available all
reports and work papers produced or developed by Bancorp's auditors in
connection with their examination of the financial statements of Bancorp or
Bank, as well as all working papers and reports for any prior period for
which any tax or other liability of Bancorp has not been finally determined
or barred by the statute of limitations.
<PAGE>
The financial statements and Call Reports described in subsections (a) and
(b), above, shall fairly present, as of their respective dates, the financial
position of Bancorp and Bank and the results of their operations for the
periods indicated; and each such statement has been, and shall have been,
prepared in conformity with the Regulatory Accounting Standards and generally
accepted accounting principles applied on a consistent basis. The financial
statements described in Subsections (a) and (b), above, shall not, as of the
dates thereof, include any material assets or omit to state any material
liability, absolute or contingent, or other facts, the inclusion or omission
of which renders such financial statements, in light of the circumstances
under which they were made, materially misleading, and there shall not have
been since December 31, 1993, any material adverse change in the financial
condition, results of operations, assets, business or prospects of Bancorp or
Bank, other than changes in the ordinary course of business, none of which
individually or in the aggregate has been materially adverse.
Section 5.03. Shareholders' Meeting. Bancorp, acting through
its Board of Directors, shall promptly in accordance with applicable law:
(a) take all actions necessary to duly call, give notice
of, convene and hold an annual or special meeting of its shareholders (the
"Shareholders' Meeting") as soon as practicable for the purpose of
considering and taking action upon this Agreement, the Merger and related
matters;
(b) subject to its fiduciary duties under applicable law
as determined by Bancorp's Board of Directors, include in the
Prospectus/Proxy (as defined in Section 5.04) the recommendation of Bancorp's
Board of Directors that shareholders of Bancorp vote in favor of the approval
and adoption of this Agreement, the Merger and the transactions contemplated
hereby; and
(c) use its best efforts (i) to obtain and furnish the
information required to be included by it in the Prospectus/Proxy and cause
the Prospectus/Proxy Statement to be mailed to its shareholders at the
earliest practicable time and (ii) to obtain the necessary approvals by the
requisite percentage of its shareholders of this Agreement, the Merger and
the other transactions contemplated hereby.
Section 5.04. Registration Statement Information. Bancorp will
furnish the Corporation with all information concerning Bancorp required for
inclusion: (i) in a registration statement (including the related prospectus)
on Form S-4 (or other appropriate form), any amendments thereto or any
supplements to any prospectus contained therein (the "Registration
Statement"), filed by the Corporation with the Securities and Exchange
Commission (the "Commission") in order to register under the 1933 Act or in
any blue sky application or exemption request filed with any state securities
commission regarding, the offer, sale and delivery of the shares of the M&I
Stock to be issued pursuant to the Merger; or
<PAGE>
(ii) in any application or statement made by the Corporation to any
government agency or authority in connection with the transaction
contemplated by this Agreement and the Merger Agreement. Bancorp hereby
represents and warrants to the Corporation that at the time the Registration
Statement and Blue Sky Permits become effective, the Registration Statement
and the Prospectus/Proxy Statement included therein and all Blue Sky
Applications, insofar as they relate to Bancorp and are based upon written
information furnished by Bancorp to the Corporation for use therein: (i) will
comply in all material respects with the provisions of the 1933 Act,
including the requirement to provide audited financial information with
respect to Bancorp and Bank to the Corporation; and (ii) will not contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and that, at the time of the shareholders meeting referred to in
Section 5.03, above and at the Effective Time, the Prospectus/Proxy
Statement, as amended or supplemented by any amendment filed by the Corpora-
tion, insofar as it relates to Bancorp or Bank and is based upon written
information furnished by Bancorp to the Corporation for use in such
Prospectus/Proxy Statement, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
Section 5.05. Filing of Registration Statement; Blue Sky
Filings. The Corporation will, after receiving from Bancorp all information
necessary for the Registration Statement regarding Bancorp or Bank, file the
Registration Statement with the Commission as soon as practicable and use its
best efforts to cause the Registration Statement to become effective as soon
thereafter as practicable. The Corporation shall make all appropriate
applications and filings with and obtain all appropriate consents, permits,
registrations (or exemptions therefrom) required by any state securities law
in connection with this Agreement, and the same shall be in effect prior to
the mailing of the Prospectus/Proxy Statement to Bancorp shareholders, at the
date of the special meeting of shareholders of Bancorp and at the Effective
Time. The Corporation represents and warrants to Bancorp that at the time
the Registration Statement and Blue Sky permits become effective, the
Registration Statement and the Prospectus/Proxy Statement included therein
and all Blue Sky Applications: (i) will comply in all material respects with
the provisions of the 1933 Act; and (ii) will not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
and that, at the time of the shareholders meeting referred to in Section
5.03, above and at the Effective Time, the Prospectus/Proxy Statement, as
amended or supplemented by any amendment or supplement filed by the
Corporation will not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements contained therein,
in light of the circumstances under which they were made, not misleading;
provided, however, that none of the representations and warranties in this
Section 5.05 shall apply to statements in or omissions from the Registration
Statement or Prospectus/Proxy Statement made in reliance upon and in confor-
mity with written information furnished by Bancorp for use in the
Registration Statement or Prospectus/Proxy Statement as provided in Section
5.04, above.
<PAGE>
Section 5.06. Government Filings. The Corporation shall
promptly prepare and file with the Federal Reserve Board and other
appropriate state and federal banking regulatory agencies, an application on
an appropriate form to complete the Merger and the other transactions
contemplated herein and will use its best efforts to have all such
applications approved as promptly as possible.
Section 5.07. Access, Investigation and Review. From and after
the date of this Agreement, Bancorp and Bank shall afford to the officers,
attorneys and accountants and other authorized representatives of the
Corporation full and free access to the properties, books, contracts,
commitments and records of Bancorp or Bank, at all reasonable times during
business hours, and such representatives of the Corporation shall be
furnished with true and complete copies of the same and with all other
information concerning the affairs of Bancorp or Bank as such representatives
may reasonably request. Any such information treated as confidential by
Bancorp or Bank (and so marked at the time of release to the representatives
of the Corporation) shall be kept confidential by the representatives of the
Corporation (and shall be used by them only in connection with this Agreement
and the transactions contemplated hereby) except to the extent that: (i) it
was already known to such representatives when received; (ii) it hereafter
becomes lawfully obtainable from other sources; or (iii) it is required to be
disclosed by the Corporation in any document required to be filed with the
Federal Reserve Board, the Wisconsin Office of the Commissioner of Banking,
the FDIC, the Securities and Exchange Commission or any other government
agency or authority.
Section 5.08. No Solicitation. Neither Bancorp, Bank nor any of
their officers, directors, employees, agents or representatives (including,
without limitation, investment bankers, attorneys and accountants) shall
directly or indirectly, without the prior written consent of the Corporation,
initiate contact with, solicit or encourage any inquiries or proposals by or
except as, in the written opinion of Bancorp's counsel, may be required by
the fiduciary duties of the Board of Directors of Bancorp, enter into any
discussions or negotiations or agreements with, or disclose directly or
indirectly any information not customarily disclosed concerning its business
and properties, or afford any access to its properties, books and records to,
any corporation, partnership, person or other entity or group in connection
with any possible proposal regarding a tender offer for or sale of Bancorp's
or Bank's capital stock or a consolidation, merger, or sale of all or a
substantial portion of the assets of Bancorp, Bank or any similar
transaction.
Section 5.09. Consultation and Notice of Actions and
Proceedings. During the period from the date of this Agreement to the
Effective Time, Bancorp and Bank will cause one or more of its officers to
confer on a regular and frequent basis with officers of the Corporation to
report the general status of ongoing operations and to consult with the
Corporation as to the making of any decisions or the taking of any actions in
<PAGE>
matters outside the ordinary course of business. Bancorp shall promptly
notify the Corporation of any claims, actions, proceedings or investigations
commenced or, to the best of its knowledge threatened, involving Bancorp,
Bank or any of their properties or assets or, to the best of its knowledge,
any employee, director or officer of Bancorp or Bank which if pending on the
date hereof would have been required to be disclosed in writing pursuant to
Section 3.08 hereof or which relates to the consummation of the Merger.
Bancorp shall give prompt notice to the Corporation of: (i) any notice of, or
other communication relating to, a default or event of default which, with
notice or lapse of time or both, would become a default, received by Bancorp
subsequent to the date of this Agreement and prior to the Effective Time,
under any agreement, indenture or instrument material to the financial
condition, properties, business or results of operations of Bancorp or Bank
to which Bancorp or Bank is a party or is subject; (ii) any notice or other
communication from any third party alleging that the consent of such third
party is or may be required in connection with the transactions contemplated
by this Agreement; (iii) any notice or other communication from any
regulatory authority in connection with the transactions contemplated hereby;
or (iv) any material adverse change in the financial condition, properties,
businesses or results of operations of Bancorp or Bank.
Section 5.10. Agreement by Affiliated Shareholders of Bancorp.
(a) Bancorp shall deliver to the Corporation a letter
identifying all persons whom it believes to be, at the time of the
shareholders meeting referred to in Section 6.01, an "affiliate" for purposes
of Rule 145 under the Securities Act; and
(b) Each shareholder of Bancorp who shall, in the opinion
of counsel to the Corporation, be deemed to be an "affiliate" of Bancorp,
within the meaning of such term as used in Rule 145 ("Rule 145") of the
General Rules and Regulations (the "Rules") of the Commission under the 1933
Act, shall enter into an agreement ("Affiliate Agreement"), prior to the
Effective Date, substantially in the form attached hereto as Exhibit B to the
effect that no disposition of M&I Stock received in the Merger will be made
by such persons except within the limits and in accordance with the
applicable provisions of said Rule 145, as amended from time to time, or
except in a transaction which, in the opinion of legal counsel reasonably
satisfactory to the Corporation, is exempt from registration under the
Securities Act.
Section 5.11. Reasonable Best Efforts. Subject to the terms and
conditions herein provided, each of the parties hereto agrees to use its
reasonable best efforts to take, or cause to be taken, all action, and to do,
or cause to be done, all things reasonably necessary, proper or advisable
under applicable laws and regulations to consummate and make effective the
transactions contemplated by this Agreement, including, without limitation:
(i) cooperation in the preparation and filing of the Prospectus/Proxy
Statement and any amendments thereto; (ii) the satisfaction of all
requirements of any financing agreements; (iii) the taking of all action
reasonably necessary, proper or advisable to secure existing debt obligations
of Bancorp or amend the notes, indentures or agreements relating thereto to
<PAGE>
the extent required by such notes, indentures or agreements or redeem or
repurchase such debt obligations; and (iv) the execution of any additional
instruments necessary to consummate the transactions contemplated hereby. In
case at any time after the Effective Time any further action is necessary or
desirable to carry out the purposes of this Agreement, the proper officers
and directors of each party hereto shall take all such necessary action.
Section 5.12. Formation of Interim. The Corporation agrees to
cause Interim to be organized promptly under the laws of the State of
Wisconsin. Following the organization and due formation of Interim it shall,
by addendum to this Agreement, become a party to the Agreement. At such time
as Interim has been organized, the Corporation agrees to secure approval of
the Merger Agreement by the Board of Directors of Interim and to cause
Interim to execute and deliver the Merger Agreement.
Section 5.13. Public Announcements. The Corporation and
Bancorp, as the case may be, will consult with one another before issuing any
press release or otherwise making any public statements with respect to the
transactions contemplated by this Agreement, and shall not issue any such
press release or make any such public statement prior to such consultation,
except as may be required by applicable law or by obligations pursuant to any
listing agreement with any national securities exchange, as determined by the
Corporation or Bancorp, as the case may be.
ARTICLE VI
CONDITIONS TO CLOSING
Section 6.01. Conditions to Obligations of the Corporation. The
obligations of the Corporation under this Agreement are subject, in the
discretion of the Corporation, to the satisfaction at or prior to the
Effective Date of each of the following conditions:
(a) The representations and warranties made by Bancorp and
Bank in Article III or otherwise in this Agreement with respect to itself
shall have been true when made and, except for changes as contemplated
herein, shall be true at the Effective Time with the same force and effect as
if such representations and warranties were made at and as of the Effective
Time and Bancorp and Bank shall have performed or complied in all material
respects with all obligations, covenants and conditions required by Articles
V and VI and as otherwise required in this Agreement to be performed or
complied with by Bancorp or Bank prior to or at the Closing or Effective
Time. Bancorp shall have furnished the Corporation with a certificate,
signed by the President of Bancorp and dated the Effective Date, to the
foregoing effect.
(b) The holders of the requisite percentage of the
outstanding shares of Bancorp Stock shall have duly authorized, adopted and
approved this Agreement, the Merger Agreement and the consummation of the
transactions contemplated herein and in the Merger Agreement. Bancorp shall
have delivered to M&I a certificate signed by the President of Bancorp as to
the details of the foregoing.
<PAGE>
(c) The Corporation shall have received a certificate,
dated the Closing Date, of the President of Bancorp to the effect that he has
read the Registration Statement, and, with respect to the information set
forth in the Registration Statement relating to Bancorp, such Registration
Statement, as of its effective date, as of the date of such certificate, and
as of the Effective Time, contained no untrue statement of a material fact or
omitted to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(d) Bancorp shall have obtained and delivered to the
Corporation the Affiliate Agreements of those persons who, in the opinion of
counsel to the Corporation, may be deemed to be "affiliates" (as such term is
defined in the published rules and regulations under the 1933 Act) of
Bancorp.
(e) As of the close of the most recent calendar quarter
(or if the Merger shall occur within 20 days following the close of a
calendar quarter, then as of the close of the next preceding calendar
quarter) the "Bank's Net Earnings" (as hereinafter defined) for (i) the four
most recent calendar quarters of Bank on a cumulative basis and (ii) the most
recent fiscal year of Bank for which Bank's earnings have been reported as of
such date, shall each be not less than $2,200,000. As used in this Section,
the "Bank's Net Earnings" means the net income of Bank for the relevant
period(s) determined in accordance with the Regulatory Accounting Standards
and generally accepted accounting principles applied on a basis consistent
with Bank's financial statements for the years ended December 31, 1992 and
1993, as referenced in Section 3.04 hereof, subject to any subsequent
adjustments required to be reported after the Effective Time, whether or not
such adjustments have, as yet, been reported, with the following expenses, if
any, net of related tax savings and costs, which were reflected in net income
for the relevant period(s) added back into net income for the applicable
period: (i) investment banking expenses, outside legal fees, outside
accounting fees, and printing costs associated with the Merger; and (ii) any
other expenses upon which the Corporation and Bancorp shall mutually agree.
(f) As of the end of the month last preceding the
Effective Time, the total net worth of Bank, prepared in accordance with the
Regulatory Accounting Standards and generally accepted accounting principles,
applied on a basis consistent with their respective Statements of Changes in
Shareholders' Equity as of December 31, 1993, certified by the Cashier of the
Bank, shall not be less than $17,300,000 excluding any adjustments made
pursuant to paragraph (k) hereto.
(g) Between December 31, 1993 and the Effective Time there
shall have been no material adverse change in the financial condition of
Bancorp or Bank from that set forth in (i) the financial statements and Call
Reports described in Section 3.04 hereof or (ii) the reserve for possible
loan and lease losses described in Section 3.05 hereof, and nothing shall
<PAGE>
have come to the Corporation's attention to lead it to believe that there is
or could be a material increase in the loans set forth in the Loan Schedule
described in Section 3.20 hereof. For purposes of this Section 6.01, without
limiting additional factors which may be considered material, a material
adverse change or material increase in the Loan Schedule shall mean any item,
occurrence or event or any series of the same resulting in damage, loss
(including unrecognized losses), liability, cost or expense which exceeds, in
the aggregate, $250,000, as shall be determined by the Corporation in its
sole discretion, but in the exercise of good faith.
(h) No payment on any indebtedness of Bancorp or Bank
will, as a result of the Merger, be accelerated except those of which Bancorp
has notified the Corporation in writing not less than sixty (60) days prior
to the Closing and which acceleration(s) of indebtedness has been accepted by
the Corporation in writing prior to the Effective Time.
(i) As of the close of the month ending not more than
thirty (30) days prior to the Effective Time, Bancorp and Bank shall have
made such adjustments, charge offs, additions to reserves and other
accounting and income tax provisions as the Corporation shall in its sole
discretion deem appropriate.
(j) As of the Effective Time, Bancorp will have no
liabilities.
Section 6.02. Conditions to Obligations of Bancorp. The
obligations of Bancorp under this Agreement and the Merger Agreement are
subject, in the discretion of Bancorp, to the satisfaction, at or prior to
the Effective Date, of each of the following conditions:
(a) The representations and warranties made by the
Corporation in this Agreement shall have been true when made, and except as
may otherwise be contemplated or permitted herein, shall be true as of the
Effective Date with the same force and effect as if such representations and
warranties were made at and as of the Effective Date, and the Corporation
shall have performed or complied with all obligations, covenants and
conditions required by this Agreement and the Merger Agreement to be
performed or complied with by it prior to or at the Closing. Bancorp shall
have been furnished with a certificate, signed by the President of the
Corporation and dated the Effective Date, to the foregoing effect.
Section 6.03. Conditions to Respective Obligations of the
Corporation and Bancorp. The respective obligations of the Corporation,
Interim and Bancorp under this Agreement and the Merger Agreement are subject
to the further conditions that:
(a) The holders of no more than 5% of the shares of
Bancorp Stock shall, at the Closing Date, be entitled to assert statutory
dissenters' appraisal rights under applicable provisions of the Wisconsin
Statutes with respect to the Merger.
(b) Bancorp and the Corporation shall have received
letters (in form and substance satisfactory to the Corporation and its
counsel) from Bancorp shareholders holding 5% or more of Bancorp Stock
representing to the Corporation and Bancorp that as of the Effective Date,
such shareholders have no present plan or intention to dispose of any shares
of M&I Stock acquired by reason of the Merger.
<PAGE>
(c) The parties hereto shall have received final approval
of the transactions contemplated by this Agreement from all appropriate
government agencies and authorities, including the Federal Reserve Board,
without any condition which is not satisfactory to the Corporation, all
conditions required to be satisfied prior to the Effective Time imposed by
the terms of such approvals shall have been satisfied, and all waiting
periods relating to such approvals shall have expired. Such approvals and
the transaction contemplated hereby shall not have been contested by any
federal or state government authority nor by any other third party by formal
proceeding.
(d) No statute, rule or regulation shall have been enacted
in the State of Wisconsin by any governmental or regulatory agency of
competent jurisdiction which prevents or restricts consummation of the
Merger.
(e) The Registration Statement shall be effective under
the 1933 Act prior to the mailing of the Prospectus/Proxy Statement to
Bancorp's shareholders, and at the date of the meeting of shareholders
referred to in Section 6.01 hereof and at all times thereafter to and
including the Effective Time, and no stop order suspending the effectiveness
thereof shall have been issued during such period and no proceedings for that
purpose shall have been instituted or be pending at the Effective Time. All
appropriate registrations, permits and consents required by any state
securities law (or exemptions therefrom) in connection with this Agreement
shall have been obtained and be in effect at the date of the meeting of
shareholders and at the Effective Time.
(f) On the Effective Date there shall not be any
litigation, investigation, inquiry or proceeding pending or threatened in or
by any court or government agency or authority which might result in an
action to restrain, enjoin or prohibit consummation of the transactions
contemplated by this Agreement or the Merger Agreement, or which might result
in divestiture, rescission or damages in connection with such transactions or
involving any of the assets, properties, business or operations of Bancorp or
Bank which might result in any material adverse change in the financial
condition, results of operations, business or prospects of Bancorp or Bank;
and each of the parties shall furnish the other with a certificate, dated the
Closing Date and signed by the President of Bancorp and the Corporation
respectively, to the effect that no such litigation, investigation, inquiry
or proceeding is pending, or to the best of his knowledge, threatened against
such party.
(g) All actions, proceedings, instruments and documents
required to carry out the transaction contemplated by this Agreement and the
Merger Agreement or incidental thereto and all other related legal matters
(including but not limited to all matters relating to the federal income tax
consequences of the Merger) shall have been satisfactory to and approved by
counsel to each of the parties to this Agreement and such counsel shall have
been furnished with certified copies of actions and proceedings and such
other documents and instruments as they shall have reasonably requested.
<PAGE>
ARTICLE VII
TERMINATION
Section 7.01. Reasons for Termination and Abandonment. This
Agreement may be terminated and abandoned before the Effective Date,
notwithstanding the approval and adoption of this Agreement or the Merger
Agreement by the shareholders of Bancorp and/or Interim:
(a) By mutual consent of the Boards of Directors of
Bancorp and the Corporation;
(b) By either Bancorp or the Corporation if the Merger is
not consummated on or before April 30, 1995;
(c) By the Corporation if any of the conditions provided
for in Sections 6.01 and 6.03 of this Agreement have not been met and have
not been waived in writing by the Corporation;
(d) By Bancorp, if any of the conditions of Sections 6.02
and 6.03 of this Agreement have not been met and have not been waived in
writing by Bancorp; or
(e) By Bancorp, if at the time of such termination there
shall be a material adverse change in the consolidated financial condition of
the Corporation from that set forth in the Corporation's Balance Sheet
included in its Form 10-K for the year ended December 31, 1993.
Section 7.02. Notice. In the event of termination and
abandonment by any party as above provided in this paragraph, written notice
shall forthwith be given to the other parties, which notice shall
specifically describe the basis for such termination.
Section 7.03. Effect of Termination. If the Merger is not
consummated as the result of termination of this Agreement, the Corporation
and Bancorp each shall pay their own fees and expenses incident to the
negotiation, preparation and execution of this Agreement, their respective
shareholders' meetings and actions and all other acts incidental to, contem-
plated by or in pursuance of the transactions contemplated by this Agreement,
including fees and expenses of their respective counsel, accountants and
other experts and advisors and this Agreement shall immediately terminate and
neither Bancorp nor the Corporation shall have any liability under this
Agreement for damages or otherwise.
<PAGE>
ARTICLE VIII
MISCELLANEOUS
Section 8.01. Survival of Representations and Warranties. All
representations, warranties and covenants in this Agreement shall survive the
Closing and any investigation by the parties hereto; provided, however, that
no officer, director or shareholder of Bancorp, Bank or the Corporation shall
have any liability hereunder except in the case of gross negligence, bad
faith or fraud.
Section 8.02. Notices. Any notice given hereunder shall be in
writing and shall be mailed by first class mail, postage prepaid, to the
parties at the following addresses:
If to M&I, then to:
Marshall & Ilsley Corporation
770 North Water Street
Milwaukee, Wisconsin 53201
Attention: M. A. Hatfield, Senior Vice President
With a copy to:
Mr. James A. Sheriff
Godfrey & Kahn, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202
If to Bancorp, then to:
Citizens Bancorp of Delavan, Inc.
104 North 5th Street
P.O. Box 307
Delavan, Wisconsin 53115
Attention: Mr. Rymund Wurlitzer
With a copy to:
Mr. Prescott Wurlitzer
104 North 5th Street
Delavan, Wisconsin 53115
Section 8.03. Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties hereto, their respective successors
and assigns, but shall not be assigned by either party without the prior
written consent of the other party.
Section 8.04. Articles and Other Headings. Articles and other
headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement.
Section 8.05. Entire Agreement. This agreement embodies the
entire agreement between the parties and supersedes all prior arrangements,
understandings, agreements or covenants between the parties.
<PAGE>
Section 8.06. Governing Law. This Agreement shall be governed
by the laws of the State of Wisconsin applicable to contracts made and to be
performed therein.
Section 8.07. Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall be deemed to be an
original, and such counterparts shall together constitute but one and the
same instrument.
Section 8.08. Amendment and Modification. Subject to applicable
law, this Agreement may be amended, modified and supplemented in any and all
respects, at any time before or after the approval of the Merger by the
shareholders of Bancorp as contemplated by Section 5.03 hereof, by written
agreement of Bancorp, and the Corporation, but after such approval of the
shareholders of Bancorp, no such amendment, modification or supplement shall
reduce or change the form of the consideration being paid pursuant to
Sections 2.02 and 2.03 hereof, or change any of the terms and conditions of
the Agreement in a manner which materially and adversely affects the rights
of Bancorp's shareholders hereunder without the approval of such
shareholders.
Section 8.09. Expenses. Each party to this Agreement shall pay
their own expenses in connection with the transactions contemplated hereby.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the date first above written.
MARSHALL & ILSLEY CORPORATION
By: /s/ M. A. Hatfield
______________________________
M. A. Hatfield
Its: Senior Vice President
Attest:
_________________________
CITIZENS BANCORP OF DELAVAN, INC.
By: /s/ Rymund Wurlitzer
______________________________
Rymund Wurlitzer
Its: Chairman
Attest:
_________________________
MJP-M&I DELAVAN AGR 1--del-m&i.mjp
<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER dated as of the _____ day of
____________, 1994, by and between M&I Interim Corp., a Wisconsin corporation
("Interim"), and Citizens Bancorp of Delavan, Inc., a Wisconsin corporation
("Bancorp").
W I T N E S S E T H
WHEREAS, Bancorp and Marshall & Ilsley Corporation, a Wisconsin
corporation ("M&I"), which is the sole shareholder of Interim, have entered
into that certain Agreement and Plan of Reorganization dated the 31st day of
August, 1994 (the "Reorganization Agreement"), whereby Bancorp shall be
merged with and into Interim under the terms and conditions of the
Reorganization Agreement and this Agreement.
NOW, THEREFORE, in consideration of the mutual promises and
agreements hereafter set forth, the parties hereto agree as follows:
ARTICLE I
MERGER OF INTERIM INTO BANCORP
Section 1.01. Merger. Upon the terms and subject to the
conditions of this Agreement and the Reorganization Agreement, at the
Effective Time (as hereinafter defined), Bancorp shall be merged with and
into Interim (which is hereinafter referred to as the "Surviving Corporation"
whenever reference is made to it on or after the Effective Time) pursuant to
the applicable provisions of the Wisconsin Statutes (the "Merger").
Section 1.02. Effective Time of Merger. The Merger shall become
effective at the time specified in Section 6.03 of the Reorganization
Agreement (the "Effective Time" or the "Effective Date").
Section 1.03. Consequences of Merger. At and as of the
Effective Time, and as a result of the Merger:
(a) Continued Existence of Interim. The corporate
identity, existence, purposes, powers, franchises, rights and immunities of
Interim shall continue and be unaffected and unimpaired.
<PAGE>
(b) Effect on Bancorp. The corporate identity, existence,
purposes, powers, franchises, rights and immunities of Bancorp shall be
merged with and into Interim and the Surviving Corporation shall be fully
vested therewith. The separate legal existence of Bancorp shall cease and
the assets and liabilities of Bancorp shall be transferred to and vested in
the Surviving Corporation. The rights, interests and franchises of Bancorp
in and to every species of property, real, personal and mixed and choses in
action thereto belonging, shall be deemed transferred to and vested in the
Surviving Corporation without any deed, endorsement or other instrument of
transfer and the Surviving Corporation shall take, hold and enjoy the same
and all rights of property, franchises and interests in the same manner and
to the same extent as were held and enjoyed by Bancorp at the time of the
Merger.
(c) Articles of Incorporation. From and after the
Effective Date, the Articles of Incorporation of Interim as in effect
immediately prior to the Effective Date shall continue as the Articles of
Incorporation of the Surviving Corporation unless and until further amended
or repealed as provided therein or by law.
(d) By-Laws. From and after the Effective Date, the
By-Laws of Interim as in effect immediately prior to the Effective Date shall
continue as the By-Laws of the Surviving Corporation unless and until further
amended or repealed as provided therein or by law.
(e) Directors and Officers. The directors and officers of
Interim holding office immediately prior to the Effective Date shall continue
from and after the Effective Date as directors and officers of the Surviving
Corporation until the election of their respective successors or until their
resignation or removal as provided by law or in the Articles of Incorporation
or By-Laws of the Surviving Corporation. If on the Effective Date any
vacancy shall exist on the Board of Directors or in the officers of Interim
such vacancy may be filled in the manner provided by the By-Laws of the
Surviving Corporation.
(f) Name of Surviving Corporation. From and after the
Effective Date, the name of the Surviving Corporation shall be "M&I Interim
Corp."
(g) Acts of Bancorp. Until thereafter changed in
accordance with applicable law, and the Articles of Incorporation and By-Laws
of the Surviving Corporation, all corporate acts, plans, policies, contracts,
approvals and authorizations of Bancorp and its shareholders, Board of
Directors, committees elected or appointed thereby, officers and agents,
which were valid and effective immediately prior to the Effective Time, shall
<PAGE>
be taken for all purposes as the acts, plans, policies, contracts, approvals
and authorizations of the Surviving Corporation and shall be as effective and
binding on the Surviving Corporation as the same were with respect to
Bancorp.
ARTICLE II
CONVERSION AND EXCHANGE OF SECURITIES
Section 2.01. Manner of Conversion. Subject to the terms and
conditions set forth in this Agreement and the Reorganization Agreement, as
of the Effective Time, by virtue of the Merger and without any action on the
part of any holder of shares of Bancorp Stock:
(a) All Bancorp Stock owned by Bancorp shall be cancelled
and no M&I Stock or cash shall be delivered in exchange therefor;
(b) Each outstanding share of Bancorp Stock as to which
shareholders have validly perfected dissenter's rights in accordance with
applicable Wisconsin law shall not be converted into and shall not become M&I
Stock hereunder (hereinafter, the "Dissenting Shares"), and Bancorp shall
give the Corporation prompt notice of any written notice from any shareholder
of Bancorp objecting to the Merger (the "Dissenting Shareholders"). Prior to
the Effective Time, Bancorp shall not, except with prior written consent of
the Corporation, voluntarily make any payment with respect to or settle or
offer to settle any such objection. Each Dissenting Shareholder who becomes
entitled, pursuant to the provisions of applicable law, to payment for
Bancorp Stock shall receive payment therefor from the Surviving Corporation
(but only after the amount thereof shall have been agreed upon or finally
determined pursuant to the provisions of the laws of the State of Wisconsin)
and such shares of Bancorp Stock shall be cancelled. If any Dissenting
Shareholder shall fail to perfect or shall effectively withdraw or lose the
right to appraisal of payment for shares of Bancorp Stock under applicable
law, such shares shall be thereupon converted into M&I Stock in accordance
with the provisions of Sections 2.02 and 2.03 of the Reorganization
Agreement; and
(c) Each share of Bancorp Stock (except shares described
in subparagraph (a) hereof and Dissenting Shares) issued and outstanding as
of the Effective Time shall by virtue of the Merger and without any action on
the part of the holder thereof be converted into the right to receive Three
Hundred Five and Eighty Five One Hundreths (305.85) shares of M&I Stock.
<PAGE>
Section 2.02. No Fractional Shares. No fractional shares of M&I
Stock shall be issued upon the surrender for exchange of certificates; no
dividend or distribution with respect to M&I Stock shall be payable on or
with respect to any fractional share; and no fractional share interest shall
entitle the owner thereof to any rights of a shareholder of the Corporation.
In lieu of any such fractional share, the Corporation shall pay to each
former shareholder who otherwise would be entitled to receive a fractional
share of M&I Stock an amount in cash determined by multiplying the closing
sales price of M&I Stock as reported in the Midwest Edition of the Wall
Street Journal on the Effective Date by the fraction of a share of M&I Stock
to which such holder would otherwise be entitled.
Section 2.03. Payment of Merger Consideration.
(a) As soon as practicable after the Effective Time, the
Corporation shall make available to the Surviving Corporation, which in turn
shall make available to M&I Marshall & Ilsley Bank or other financial
institution which shall be designated by the Corporation as Exchange Agent
(the "Exchange Agent") certificates representing the shares of M&I Stock into
which the Bancorp Stock shall be converted pursuant to Section 2.02 of the
Reorganization Agreement. The Surviving Corporation, at the Effective Time,
shall make available to the Exchange Agent (either with funds provided by the
Corporation or its own funds), the cash payable to Dissenting Shareholders
(to the extent known). The Corporation shall provide the Surviving
Corporation, which in turn shall make available to the Exchange Agent, the
cash necessary to make all required payment for fractional shares pursuant to
Section 2.03 of the Reorganization Agreement.
(b) As soon as practicable after the Effective Time, the
Exchange Agent will send a notice and transmittal form to each holder of a
certificate which formerly represented Bancorp Stock prior to the Merger,
advising such holder of the terms of the exchange effected by the Merger and
the procedure for surrendering to the Exchange Agent such certificate for
exchange into one or more certificates evidencing shares of M&I Stock and/or
cash (as to fractional or Dissenting Shares). Until so surrendered, each
outstanding certificate will be deemed for all purposes to evidence the right
to receive cash (as to fractional or Dissenting Shares) and/or the ownership
of the number of full shares of M&I Stock as provided herein; provided,
however, that until such certificates are so surrendered, no dividend payable
to holders of record of shares of M&I Stock as of any date subsequent to the
Effective Time shall be paid to the holder or holders of such certificates in
respect to M&I Stock represented thereby. After the Effective Time, there
<PAGE>
shall be no further registry of transfers on the records of the Bancorp of
the Bancorp Stock and, if a certificate representing such Bancorp Stock is
presented to the Surviving Corporation for transfer, it shall be cancelled
and exchanged for a check in the appropriate amount and/or a certificate
representing the appropriate number of shares of M&I Stock as herein
provided. Upon surrender of certificates for the Bancorp Stock which have
been converted into shares of M&I Stock, there shall be paid (without
interest) to the record holder of the certificates for M&I Stock issued and
exchanged therefor: (i) on or as soon as practicable after such date of
surrender, the amount of dividends which as of any date subsequent to the
Effective Time became payable and were not paid to such holder with respect
to such shares of M&I Stock; and (ii) on the appropriate payment date
occurring subsequent to the date of surrender, the amount of such dividends,
if the record date in respect thereof occurred after the Effective Time but
prior to the date of surrender. Notwithstanding any provision of this
Agreement, neither the Exchange Agent nor any person, firm or entity shall be
liable or obligated to any former holder of any share of the Bancorp Stock
(or to anyone claiming through any such former holder) with respect to any
M&I Stock, or dividends thereon, or with respect to any cash to which any
such holder would be entitled as a consequence of the Merger, if such M&I
Stock, dividends or cash have been paid, or are payable, to any public
official pursuant to any abandoned property, escheat or similar laws.
Section 2.04. Further Powers. The Board of Directors of M&I
shall have the right, either before or after the Effective Date, to adopt
additional rules and regulations with respect to the surrender of
certificates representing Bancorp Stock and disbursements with respect
thereto not inconsistent with the provisions of this Agreement.
Section 2.05. No Additional Shares Issued. No shares of capital
stock of the Surviving Corporation shall be issued in connection with the
Merger.
ARTICLE III
CONDITIONS
Section 3.01. Conditions to Merger. Effectuation of the Merger
herein provided is conditioned upon fulfillment or waiver of all conditions
set forth in the Reorganization Agreement.
<PAGE>
ARTICLE IV
TERMINATION, AMENDMENT AND WAIVER
Section 4.01. Termination. This Agreement may be terminated in
the manner set forth in Article VII of the Reorganization Agreement and may
be amended in the manner set forth in Article VIII of the Reorganization
Agreement.
ARTICLE V
MISCELLANEOUS
Section 5.01. Necessary Action; Best Efforts. From and after
the date hereof each of the parties hereto covenants and agrees to use its
best efforts to consummate the transactions contemplated hereby and to obtain
all requisite third party consents and approvals.
Section 5.02. Notices. All notices or other communications
required or permitted to be given under this Agreement shall be in writing
and personally delivered in a manner sufficient for the service of legal
process under the laws of Wisconsin or sent by first class mail, postage
prepaid, to the parties hereto at the addresses set forth in Section 8.02 of
the Reorganization Agreement or to such changed address as a party may
designate by notice duly given.
Section 5.03. Binding Effect; No Third Party Action. This
Agreement shall be binding upon and inure to the benefit of the parties
hereto and no shareholder or creditor of a party or any other person shall
have any right to enforce or maintain any action under this Agreement or by
reason hereof.
Section 5.04. Defined Terms. All capitalized terms not
otherwise defined herein shall be defined as in the Reorganization Agreement.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
M&I INTERIM CORP.
Attest:
__________________________ By: _______________________________
____________________, President
CITIZENS BANCORP OF DELAVAN, INC.
Attest:
__________________________ By: _______________________________
____________________, President
<PAGE>
EXHIBIT B
AFFILIATE LETTER
_____________________________
_____________________________
_____________________________
_____________________________
Gentlemen:
I have been advised that as of the date of this letter I may be
deemed to be an "affiliate" of the Citizens Bancorp of Delavan, Inc., a
Wisconsin corporation (the "Bancorp"), as the term "affiliate" is (i) defined
for purposes of paragraphs (c) and (d) of Rule 145 of the Rules and
Regulations (the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended
(the "Act"), and/or (ii) used in and for purposes of Accounting Series,
Releases 130 and 135, as amended, of the Commission. Pursuant to the terms
of the Agreement and Plan of Reorganization dated as of ______________, 1994
(the "Agreement"), between Marshall & Ilsley Corporation, a Wisconsin
corporation (the "Corporation"), and the Bancorp, M&I Interim Corp., a new
Wisconsin corporation ("Interim"), will be merged with and into Bancorp (the
"Merger").
As a result of the Merger, I may receive shares of Corporation
common stock par value $________ per share (the "Corporation Securities"). I
would receive such shares in exchange of shares owned by me of Bancorp common
stock, par value $______ per share (the "Bancorp Securities").
I represent, warrant and covenant to the Corporation that in the
event I receive any Corporation Securities as a result of the Merger:
A. I shall not make any sale, transfer or other
disposition of the Corporation Securities in violation of the Act or
the Rules and Regulations.
<PAGE>
B. I have carefully read this letter and the Agreement and
discussed its requirements and other applicable limitations upon my
ability to sell, transfer or otherwise dispose of Corporation
Securities to the extent I felt necessary, with my counsel or counsel
for the Bancorp.
C. I have been advised that the issuance of Corporation
Securities to me pursuant to the Merger has been registered with the
Commission under the Act on a Registration Statement on Form S-4.
However, I have also been advised that, since at the time the Merger
was submitted for a vote of the stockholders of the Bancorp, I may be
deemed to have been an affiliate of the Bancorp, and since the
distribution by me of the Corporation Securities has not been
registered under the Act, and that I may not sell, transfer or
otherwise dispose of Corporation Securities issued to me in the Merger
unless (i) such sale, transfer or other disposition has been registered
under the Act, (ii) such sale, transfer or other disposition is made in
conformity with the volume and other limitations of Rule 145 promul-
gated by the Commission under the Act, or (iii) in the opinion of
counsel reasonably acceptable to the Corporation, such sale, transfer
or other disposition is otherwise exempt from registration under the
Act.
D. I understand that the Corporation is under no
obligation to register the sale, transfer or other disposition of the
Corporation Securities by me or on my behalf under the Act or to take
any other action necessary in order to make compliance with an
exemption from such registration available.
E. I also understand that stop transfer instructions will
be given to the Corporation's transfer agents with respect to the
Corporation Securities and that there will be placed on the
certificates for the Corporation Securities issues to me, or any
substitutions therefor, a legend stating in substance:
"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF
1933 APPLIES. THE SHARES REPRESENTED BY THIS CERTIFICATE MAY ONLY BE
TRANSFERRED IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT DATED
_________________ BETWEEN THE REGISTERED HOLDER HEREOF AND THE
CORPORATION, A COPY OF WHICH AGREEMENT IS ON FILE AT THE PRINCIPAL
OFFICES OF THE CORPORATION."
<PAGE>
F. I also understand that unless the transfer by me of my
Corporation Securities has been registered under the Act or is a sale
made in conformity with the provisions of Rule 145, the Corporation
reserves the right to put the following legend on the certificates
issued to my transferee:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 AND WERE ACQUIRED FROM A PERSON WHO
RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH RULE 145 PROMULGATED
UNDER THE SECURITIES ACT OF 1933 APPLIES. THE SHARES HAVE BEEN
ACQUIRED BY THE HOLDER NOT WITH A VIEW TO, OR FOR RESALE IN CONNECTION
WITH, ANY DISTRIBUTION THEREOF WITHIN THE MEANING OF SECURITIES ACT OF
1933 AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
ACCORDANCE WITH AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT OF 1933."
It is understood and agreed that the legends set forth in
paragraph E and F above shall be removed by delivery of substitute
certificates without such legend as soon as the Rule 145 resale restrictions
cease to apply thereto under Rule 145(d), or if the undersigned shall have
delivered to the Corporation a copy of a letter from the staff of the
Commission, or an opinion of counsel in form and substance reasonably
satisfactory to the Corporation, to the effect that such legend is not
required for purposes of the Act.
Very truly yours,
______________________________
Name:
Accepted this _____ day of
_________________, 1994, by
CORPORATION
By:____________________________
Name:__________________________
Title:_________________________
<PAGE>
APPENDIX B
WISCONSIN STATUTES SECTIONS 180.1301-180.1331
180.1301. Definitions
In ss. 180.1301 to 180.1331:
(1) "Beneficial shareholder" means a person who is a beneficial owner
of shares held by a nominee as the shareholder.
(1m) "Business combination" has the meaning given in s. 180.1130(3).
(2) "Corporation" means the issuer corporation or, if the corporate
action giving rise to dissenters' rights under s. 180.1302 is a merger or
share exchange that has been effectuated, the surviving domestic corporation
or foreign corporation of the merger or the acquiring domestic corporation or
foreign corporation of the share exchange.
(3) "Dissenter" means a shareholder or beneficial shareholder who is
entitled to dissent from corporate action under s. 180.1302 and who exercises
that right when and in the manner required by ss. 180.1320 to 180.1328.
(4) "Fair value," with respect to a dissenter's shares other than in a
business combination, means the value of the shares immediately before the
effectuation of the corporate action to which the dissenter objects,
excluding any appreciation or depreciation in anticipation of the corporate
action unless exclusion would be inequitable. "Fair value," with respect to
a dissenter's shares in a business combination, means market value, as
defined in s. 180.1130(9)(a) 1 to 4.
(5) "Interest" means interest from the effectuation date of the
corporate action until the date of payment, at the average rate currently
paid by the corporation on its principal bank loans or, if none, at a rate
that is fair and equitable under all of the circumstances.
(6) "Issuer corporation" means a domestic corporation that is the
issuer of the shares held by a dissenter before the corporation action.
180.1302. Right to dissent
(1) Except as provided in sub. (4) and s. 180.1008(3), a shareholder
or beneficial shareholder may dissent from, and obtain payment of the fair
value of his or her shares in the event of, any of the following corporate
actions:
(a) Consummation of a plan of merger to which the issuer corporation
is a party if any of the following applies:
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1. Shareholder approval is required for the merger by s.
180.1103 or by the articles of incorporation.
2. The issuer corporation is a subsidiary that is merged with
its parent under s. 180.1104.
(b) Consummation of a plan of share exchange if the issuer
corporation's shares will be acquired, and the shareholder or the shareholder
holding shares on behalf of the beneficial shareholder is entitled to vote on
the plan.
(c) Consummation of a sale or exchange of all, or substantially all,
of the property of the issuer corporation other than in the usual and regular
course of business, including a sale in dissolution, but not including any of
the following:
1. A sale pursuant to court order.
2. A sale for cash pursuant to a plan by which all or
substantially all of the net proceeds of the sale will be distributed
to the shareholders within one year after the date of sale.
(d) Except as provided in sub. (2), any other corporate action taken
pursuant to a shareholder vote to the extent that the articles of
incorporation, bylaws or a resolution of a board of directors provides that
the voting or nonvoting shareholder or beneficial shareholder may dissent and
obtain payment for his or her shares.
(2) Except as provided in sub. (4) and s. 180.1008(3), the articles of
incorporation may allow a shareholder or beneficial shareholder to dissent
from an amendment of the articles of incorporation and obtain payment of the
fair value of his or her shares if the amendment materially and adversely
affects rights in respect of a dissenter's shares because it does any of the
following:
(a) Alters or abolishes a preferential right of the shares.
(b) Creates, alters or abolishes a right in respect of redemption,
including a provision respecting a sinking fund for the redemption or
repurchase, of the shares.
(c) Alters or abolishes a preemptive right of the holder of shares to
acquire shares or other securities.
(d) Excludes or limits the right of the shares to vote on any matter
or to cumulate votes, other than a limitation by dilution through issuance of
shares or other securities with similar voting rights.
<PAGE>
(e) Reduces the number of shares owned by the shareholder or
beneficial shareholder to a fraction of a share if the fractional share so
created is to be acquired for cash under s. 180.0604.
(3) Notwithstanding sub. (1)(a) to (c), if the issuer corporation is a
statutory close corporation under ss. 180.1801 to 180.1837, a shareholder of
the statutory close corporation may dissent from a corporate action and
obtain payment of the fair value of his or her shares, to the extent
permitted under sub. (1)(d) or (2) or s. 180.1803, 180.1813(1)(d) or (2)(b),
180.1815(3) or 180.1829(1)(c).
(4) Except in a business combination or unless the articles of
incorporation provide otherwise, subs. (1) and (2) do not apply to the
holders of shares of any class or series if the shares of the class or series
are registered on a national securities exchange or quoted on the national
association of securities dealers, inc., automated quotations system on the
record date fixed to determine the shareholders entitled to notice of a
shareholders meeting at which shareholders are to vote on the proposed
corporate action.
(5) Except as provided in s. 180.1833, a shareholder or beneficial
shareholder entitled to dissent and obtain payment for his or her shares
under ss. 180.1301 to 180.1331 may not challenge the corporate action
creating his or her entitlement unless the action is unlawful or fraudulent
with respect to the shareholder, beneficial shareholder or issuer
corporation.
180.1303. Dissent by shareholders and beneficial shareholders
(1) A shareholder may assert dissenters' rights as to fewer than all
of the shares registered in his or her name only if the shareholder dissents
with respect to all shares beneficially owned by any one person and notifies
the corporation in writing of the name and address of each person on whose
behalf he or she asserts dissenters' rights. The rights of a shareholder who
under this subsection asserts dissenters' rights as to fewer than all of the
shares registered in his or her name are determined as if the shares as to
which he or she dissents and his or her other shares were registered in the
names of different shareholders.
(2) A beneficial shareholder may assert dissenters' rights as to
shares held on his or her behalf only if the beneficial shareholder does all
of the following:
(a) Submits to the corporation the shareholder's written consent to
the dissent not later than the time that the beneficial shareholder asserts
dissenters' rights.
(b) Submits the consent under par. (a) with respect to all shares of
which he or she is the beneficial shareholder.
<PAGE>
180.1320. Notice of dissenters' rights
(1) If proposed corporate action creating dissenters' rights under s.
180.1302 is submitted to a vote at a shareholders' meeting, the meeting
notice shall state that shareholders and beneficial shareholders are or may
be entitled to assert dissenters' rights under ss. 180.1301 to 180.1331 and
shall be accompanied by a copy of those sections.
(2) If corporate action creating dissenters' rights under s. 180.1302
is authorized without a vote of shareholders, the corporation shall notify,
in writing and in accordance with s. 180.0141, all shareholders entitled to
assert dissenters' rights that the action was authorized and send them the
dissenters' notice described in s. 180.1322.
180.1321. Notice of intent to demand payment
(1) If proposed corporate action creating dissenters' rights under s.
180.1302 is submitted to a vote at a shareholders' meeting, a shareholder or
beneficial shareholder who wishes to assert dissenters' rights shall do all
of the following:
(a) Deliver to the issuer corporation before the vote is taken written
notice that complies with s. 180.0141 of the shareholder's or beneficial
shareholder's intent to demand payment for his or her shares if the proposed
action is effectuated.
(b) Not vote his or her shares in favor of the proposed action.
(2) A shareholder or beneficial shareholder who fails to satisfy sub.
(1) is not entitled to payment for his or her shares under ss. 180.1301 to
180.1331.
180.1322. Dissenters' notice
(1) If proposed corporate action creating dissenters' rights under s.
180.1302 is authorized at a shareholders' meeting, the corporation shall
deliver a written dissenters' notice to all shareholders and beneficial
shareholders who satisfied s. 180.1321.
(2) The dissenters' notice shall be sent no later than 10 days after
the corporate action is authorized at a shareholders' meeting or without a
vote of shareholders, whichever is applicable. The dissenters' notice shall
comply with s. 180.0141 and shall include or have attached all of the
following:
(a) A statement indicating where the shareholder or beneficial
shareholder must send the payment demand and where and when certificates for
certificated shares must be deposited.
<PAGE>
(b) For holders of uncertificated shares, an explanation of the extent
to which transfer of the shares will be restricted after the payment demand
is received.
(c) A form for demanding payment that includes the date of the first
announcement to news media or to shareholders of the terms of the proposed
corporate action and that requires the shareholder or beneficial shareholder
asserting dissenters' rights to certify whether he or she acquired beneficial
ownership of the shares before that date.
(d) A date by which the corporation must receive the payment demand,
which may not be fewer than 30 days nor more than 60 days after the date on
which the dissenters' notice is delivered.
(e) A copy of ss. 180.1301 to 180.1331.
180.1323. Duty to demand payment
(1) A shareholder or beneficial shareholder who is sent a dissenters'
notice described in s. 180.1322, or a beneficial shareholder whose shares are
held by a nominee who is sent a dissenters' notice described in s. 180.1322,
must demand payment in writing and certify whether he or she acquired
beneficial ownership of the shares before the date specified in the
dissenters' notice under s. 180.1322(2)(c). A shareholder or beneficial
shareholder with certificated shares must also deposit his or her
certificates in accordance with the terms of the notice.
(2) A shareholder or beneficial shareholder with certificated shares
who demands payment and deposits his or her share certificates under sub. (1)
retains all other rights of a shareholder or beneficial shareholder until
these rights are canceled or modified by the effectuation of the corporate
action.
(3) A shareholder or beneficial shareholder with certificated or
uncertificated shares who does not demand payment by the date set in the
dissenters' notice, or a shareholder or beneficial shareholder with
certificated shares who does not deposit his or her share certificates where
required and by the date set in the dissenters' notice, is not entitled to
payment for his or her shares under ss. 180.1301 to 180.1331.
180.1324. Restrictions on uncertificated shares
(1) The issuer corporation may restrict the transfer of uncertificated
shares from the date that the demand for payment for those shares is received
until the corporate action is effectuated or the restrictions released under
s. 180.1326.
(2) The shareholder or beneficial shareholder who asserts dissenters'
rights as to uncertificated shares retains all of the rights of a shareholder
or beneficial shareholder, other than those restricted under sub. (1), until
these rights are canceled or modified by the effectuation of the corporate
action.
<PAGE>
180.1325. Payment
(1) Except as provided in s. 180.1327, as soon as the corporate action
is effectuated or upon receipt of a payment demand, whichever is later, the
corporation shall pay each shareholder or beneficial shareholder who has
complied with s. 180.1323 the amount that the corporation estimates to be the
fair value of his or her shares, plus accrued interest.
(2) The payment shall be accompanied by all of the following:
(a) The corporation's latest available financial statements, audited
and including footnote disclosure if available, but including not less than a
balance sheet as of the end of a fiscal year ending not more than 16 months
before the date of payment, an income statement for that year, a statement of
changes in shareholders' equity for that year and the latest available
interim financial statements, if any.
(b) A statement of the corporation's estimate of the fair value of the
shares.
(c) An explanation of how the interest was calculated.
(d) A statement of the dissenter's right to demand payment under s.
180.1328 if the dissenter is dissatisfied with the payment.
(e) A copy of ss. 180.1301 to 180.1331.
180.1326. Failure to take action
(1) If an issuer corporation does not effectuate the corporate action
within 60 days after the date set under s. 180.1322 for demanding payment,
the issuer corporation shall return the deposited certificates and release
the transfer restrictions imposed on uncertificated shares.
(2) If after returning deposited certificates and releasing transfer
restrictions, the issuer corporation effectuates the corporate action, the
corporation shall deliver a new dissenters' notice under s. 180.1322 and
repeat the payment demand procedure.
180.1327. After-acquired shares
(1) A corporation may elect to withhold payment required by s.
180.1325 from a dissenter unless the dissenter was the beneficial owner of
the shares before the date specified in the dissenters' notice under s.
180.1322(2)(c) as the date of the first announcement to news media or to
shareholders of the terms of the proposed corporate action.
<PAGE>
(2) To the extent that the corporation elects to withhold payment
under sub. (1) after effectuating the corporate action, it shall estimate the
fair value of the shares, plus accrued interest, and shall pay this amount to
each dissenter who agrees to accept it in full satisfaction of his or her
demand. The corporation shall send with its offer a statement of its
estimate of the fair value of the shares, an explanation of how the interest
was calculated, and a statement of the dissenter's right to demand payment
under s. 180.1328 if the dissenter is dissatisfied with the offer.
180.1328. Procedure if dissenter dissatisfied with payment or offer
(1) A dissenter may, in the manner provided in sub. (2), notify the
corporation of the dissenter's estimate of the fair value of his or her
shares and amount of interest due, and demand payment of his or her estimate,
less any payment received under s. 180.1325, or reject the offer under s.
180.1327 and demand payment of the fair value of his or her shares and
interest due, if any of the following applies:
(a) The dissenter believes that the amount paid under s. 180.1325 or
offered under s. 180.1327 is less than the fair value of his or her shares or
that the interest due is incorrectly calculated.
(b) The corporation fails to make payment under s. 180.1325 within 60
days after the date set under s. 180.1322 for demanding payment.
(c) The issuer corporation, having failed to effectuate the corporate
action, does not return the deposited certificates or release the transfer
restrictions imposed on uncertificated shares within 60 days after the date
set under s. 180.1322 for demanding payment.
(2) A dissenter waives his or her right to demand payment under this
section unless the dissenter notifies the corporation of his or her demand
under sub. (1) in writing within 30 days after the corporation made or
offered payment for his or her shares. The notice shall comply with s.
180.0141.
180.1330. Court action
(1) If a demand for payment under s. 180.1328 remains unsettled, the
corporation shall bring a special proceeding within 60 days after receiving
the payment demand under s. 180.1328 and petition the court to determine the
fair value of the shares and accrued interest. If the corporation does not
bring the special proceeding within the 60-day period, is shall pay each
dissenter whose demand remains unsettled the amount demanded.
<PAGE>
(2) The corporation shall bring the special proceeding in the circuit
court for the county where its principal office or, if none in this state,
its registered office is located. If the corporation is a foreign
corporation without a registered office in this state, it shall bring the
special proceeding in the county in this state in which was located the
registered office of the issuer corporation that merged with or whose shares
were acquired by the foreign corporation.
(3) The corporation shall make all dissenters, whether or not
residents of this state, whose demands remain unsettled parties to the
special proceeding. Each party to the special proceeding shall be served
with a copy of the petition as provided in s. 801.14.
(4) The jurisdiction of the court in which the special proceeding is
brought under sub. (2) is plenary and exclusive. The court may appoint one
or more persons as appraisers to receive evidence and recommend decision on
the question of fair value. An appraiser has the power described in the
order appointing him or her or in any amendment to the order. The dissenters
are entitled to the same discovery rights as parties in other civil
proceedings.
(5) Each dissenter made a party to the special proceeding is entitled
to judgment for any of the following:
(a) The amount, if any, by which the court finds the fair value of his
or her shares, plus interest, exceeds the amount paid by the corporation.
(b) The fair value, plus accrued interest, of his or her shares
acquired on or after the date specified in the dissenter's notice under s.
180.1322(2)(c), for which the corporation elected to withhold payment under
s. 180.1327.
180.1331. Court costs and counsel fees
(1)(a) Notwithstanding ss. 814.01 to 814.04, the court in a special
proceeding brought under s. 180.1330 shall determine all costs of the
proceeding, including the reasonable compensation and expenses of appraisers
appointed by the court and shall assess the costs against the corporation,
except as provided in par. (b).
(b) Notwithstanding ss. 814.01 and 814.04, the court may assess costs
against all or some of the dissenters, in amounts that the court finds to be
equitable, to the extent that the court finds the dissenters acted
arbitrarily, vexatiously or not in good faith in demanding payment under s.
180.1328.
<PAGE>
(2) The parties shall bear their own expenses of the proceeding,
except that, notwithstanding ss. 814.01 to 814.04, the court may assess the
fees and expenses of counsel and experts for the respective parties, in
amounts that the court finds to be equitable, as follows:
(a) Against the corporation and in favor of any dissenter if the court
finds that the corporation did not substantially comply with ss. 180.1320 to
180.1328.
(b) Against the corporation or against a dissenter, in favor of any
other party, if the court finds that the party against whom the fees and
expenses are assessed acted arbitrarily, vexatiously or not in good faith
with respect to the rights provided by this chapter.
(3) Notwithstanding ss. 814.01 to 814.04, if the court finds that the
services of counsel and experts for any dissenter were of substantial benefit
to other dissenters similarly situated, the court may award to these counsel
and experts reasonable fees to be paid out of the amounts awarded the
dissenters who were benefited.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers.
Section 180.0851 of the Wisconsin Business Corporation Law (the "WBCL")
requires Marshall & Ilsley Corporation ("M&I") to indemnify a director or
officer, to the extent such person is successful on the merits or otherwise
in the defense of a proceeding, for all reasonable expenses incurred in the
proceeding, if such person was a party to such proceeding because he or she
was a director or officer of M&I unless it is determined that he or she
breached or failed to perform a duty owed to M&I and such breach or failure
to perform constitutes: (i) a willful failure to deal fairly with M&I or its
shareholders in connection with a matter in which the director or officer has
a material conflict of interest; (ii) a violation of criminal law, unless the
director or officer had reasonable cause to believe his or her conduct was
lawful or no reasonable cause to believe his or her conduct was unlawful;
(iii) a transaction from which the director or officer derived an improper
personal profit; or (iv) willful misconduct.
Section 180.0858 of the WBCL provides that subject to certain
limitations, the mandatory indemnification provisions do not preclude any
additional right to indemnification or allowance of expenses that a director
or officer may have under M&I's Articles of Incorporation or Bylaws, a
written agreement between the director or officer and M&I, or a resolution of
the Board of Directors or the shareholders.
Unless otherwise provided in the articles of incorporation or bylaws,
or by written agreement between the director or officer and M&I, an officer
or director seeking indemnification is entitled to indemnification if
approved in any of the following manners as specified in Section 180.0855 of
the WBCL: (i) by majority vote of a disinterested quorum of the Board of
Directors: (ii) by independent legal counsel chosen by a quorum of
disinterested directors or its committee; (iii) by a panel of three
arbitrators (one of which is chosen by a quorum of disinterested directors);
(iv) by the vote of the shareholders; (v) by a court; or (vi) by any other
method permitted in Section 180.0858 of the WBCL.
Reasonable expenses incurred by a director or officer who is a party to
a proceeding may be reimbursed by M&I, pursuant to Section 180.0853 of the
WBCL, at such time as the director or officer furnishes to M&I written
affirmation of his good faith that he has not breached or failed to perform
his duties; and written confirmation to repay any amounts advanced if it is
determined that indemnification by M&I is not required.
Section 180.0859 of the WBCL provides that it is the public policy of
the State of Wisconsin to require or permit indemnification, allowance of
expenses and insurance to the extent required or permitted under Sections
180.0850 to 180.0858 of the WBCL for any liability incurred in connection
with any proceeding involving a federal or state statute, rule or regulation
regulating the offer, sale or purchase of securities.
As permitted by Section 180.0858, M&I has adopted indemnification
provisions in its By-Laws which closely track the statutory indemnification
provisions with certain exceptions. In particular, Section 7.1 of M&I's
By-Laws, among other items, provides that (i) an individual shall be
indemnified unless it is proven by a final judicial adjudication that
indemnification is prohibited and (ii) payment or reimbursement of expenses,
subject to certain limitations, will be mandatory rather than permissive.
M&I has purchased directors' and officers' liability insurance which has
coverage limits of $40 million per occurrence and insures M&I's officers and
directors against certain liabilities which may arise under the Securities
Act of 1933.
<PAGE>
Item 21. Exhibits and Financial Statement Schedules.
a. Exhibits
Exhibit No.
2 Agreement and Plan of Reorganization dated as of August 31, 1994,
by and between Marshall & Ilsley Corporation and Citizens Bancorp
of Delavan, Inc. (incorporated by reference to Appendix A to the
Prospectus/Proxy Statement included as part of this Registration
Statement)
5 Opinion of Godfrey & Kahn, S.C. regarding legality
8 Opinion of Godfrey & Kahn, S.C. regarding tax matters
23.1 Consent of Arthur Andersen LLP (relating to M&I)
23.2 Consent of Arthur Andersen LLP (relating to Citizens Bancorp)
23.3 Consent of Godfrey & Kahn, S.C. (contained in Exhibits 5 and 8)
24 Powers of Attorney for the Directors of Marshall & Ilsley
Corporation
99 Form of Citizens Bancorp of Delavan, Inc. Proxy
b. Financial Statement Schedules
No financial statement schedules are required to be filed herewith
pursuant to Item 21(b) or (c) of this Form S-4.
Item 22. Undertakings.
(1) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933,
each filing of the Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(2) The undersigned Registrant hereby undertakes as follows:
prior to any public reoffering of the securities registered hereunder
through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter
within the meaning of Rule 145(c), the issuer undertakes that such
reoffering prospectus will contain the information called for by the
applicable registration form with respect to reofferings by persons who
may be deemed underwriters, in addition to the information called for
by the other items of the applicable form.
(3) The Registrant undertakes that every prospectus (i) that is
filed pursuant to paragraph (2) immediately preceding, or (ii) that
purports to meet the requirements of section 10(a)(3) of the Act and is
used in connection with an offering of securities subject to Rule 415,
will be filed as a part of an amendment to the registration statement
and will not be used until such amendment is effective, and that, for
purposes of determining any liability under the Securities Act of 1933,
<PAGE>
each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(4) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing
provisions referred to in Item 20 of this registration statement, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or paid
by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
(5) The undersigned Registrant hereby undertakes to respond to
requests for information that is incorporated by reference into the
Prospectus/Proxy Statement pursuant to Items 4, 10(b), 11 or 13 of this
Form, within one business day of receipt of such request, and to send
the incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed
subsequent to the effective date of the registration statement through
the date of responding to the request.
(6) The undersigned Registrant hereby undertakes to supply by
means of a post-effective amendment all information concerning a
transaction, and the company being acquired involved therein, that was
not the subject of and included in the registration statement when it
became effective.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Milwaukee, State of Wisconsin, on February 28, 1995.
MARSHALL & ILSLEY CORPORATION
(Registrant)
By: /s/ J.B. Wigdale
-----------------------------------
J.B. Wigdale, Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dated indicated:
/s/ J.B. Wigdale Date: February 28, 1995
- ----------------------------------------------
J.B. Wigdale,
Chairman of the Board and a Director
(Chief Executive Officer)
/s/ G.H. Gunnlaugsson Date: February 28, 1995
- ----------------------------------------------
G.H. Gunnlaugsson,
Executive Vice President and a Director
(Chief Financial Officer)
/s/ P.R. Justiliano Date: February 28, 1995
- ----------------------------------------------
P.R. Justiliano
Senior Vice President and Corporate Controller
(Principal Accounting Officer)
Directors: Richard A. Abdoo, Oscar C. Boldt, J.P. Bolduc, Wendell F. Bueche,
J.F. Chait, Glenn A. Francke, G.H. Gunnlaugsson, Burleigh E.
Jacobs, Jack F. Kellner, James F. Kress, D.J. Kuester, Edward L.
Meyer, Jr., Don R. O'Hare, San W. Orr, Jr., Peter M. Platten,
III, J.A. Puelicher, Stuart W. Tisdale, J.B. Wigdale, James O.
Wright and Gus A. Zuehlke.
/s/ M.A. Hatfield Date: February 28, 1995
- ----------------------------------------------
M.A. Hatfield
As Attorney-in-Fact*
* Pursuant to authority granted by powers of attorney, copies of which are
filed herewith.
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
2 Agreement and Plan of Reorganization dated as of August 31,
1994, by and between Marshall & Ilsley Corporation and
Citizens Bancorp of Delavan, Inc. (incorporated by reference
to Appendix A to the Prospectus/Proxy Statement included
as part of this Registration Statement). . . . . . . . . . . . . . .*
5 Opinion of Godfrey & Kahn, S.C. regarding legality . . . . . . . . .
8 Opinion of Godfrey & Kahn, S.C. regarding tax matters. . . . . . . .
23.1 Consent of Arthur Andersen LLP (relating to M&I) . . . . . . . . . .
23.2 Consent of Arthur Andersen LLP (relating to Citizens Bancorp) . .
23.3 Consent of Godfrey & Kahn, S.C. (contained in Exhibits 5 and 8) . .
24 Powers of Attorney for the Directors of Marshall & Ilsley
Corporation. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
99 Form of Citizens Bancorp of Delavan, Inc. Proxy. . . . . . . . . . .
______________
* Incorporated by reference as noted.
PMK-M&I Delavan Form S-4
MI-DS-S4.PMK
2/23/95
<PAGE>
EXHIBIT 5
<PAGE>
February 22, 1995
Marshall & Ilsley Corporation
770 North Water Street
Milwaukee Wisconsin 53202
Gentlemen:
We have acted as your counsel in connection with the preparation
of a Registration Statement on Form S-4 filed with the Securities and
Exchange Commission on or about February 22, 1995 (the "Registration
Statement") relating to the issuance of up to 1,132,562 shares of Marshall &
Ilsley Corporation ("M&I") common stock, $1.00 par value ("M&I Stock"). The
M&I Stock is being registered in connection with the merger of Citizens
Bancorp of Delavan, Inc. a Wisconsin corporation, with and into M&I Interim
Corp., a Wisconsin corporation and wholly-owned subsidiary of M&I, as
described in the Registration Statement and the Prospectus/Proxy Statement
included therein.
We have examined: (a) the Prospectus/Proxy Statement and the
Registration Statement, (b) M&I's Articles of Incorporation, as amended, and
By-Laws, as amended, (c) certain resolutions of M&I's Board of Directors, and
(d) such other proceedings, documents and records as we have deemed necessary
to enable us to render this opinion.
Based on the foregoing, we are of the opinion that M&I Stock,
when issued as described in the Prospectus/Proxy Statement, will be duly
authorized and validly issued, fully paid and non-assessable except to the
extent provided in Section 180.0622(2)(b) of the Wisconsin Statutes, or any
successor provision, which provides that shareholders of a corporation
organized under Chapter 180 of the Wisconsin Statutes may be assessed up to
the par value of their shares to satisfy the obligations of such corporation
to its employees for services rendered, but not exceeding six months service
in the case of any individual employee; certain Wisconsin courts have
interpreted "par value" to mean the full amount paid by the purchaser of
shares upon the issuance thereof.
<PAGE>
We consent to the use of this opinion as an exhibit to the
Registration Statement. In giving this consent, however, we do not admit
that we are "experts" within the meaning of Section 11 of the Securities Act
of 1933, as amended, or within the category of persons whose consent is
required by Section 7 of said Act.
Very truly yours,
/s/ Godfrey & Kahn, S.C.
GODFREY & KAHN, S.C.
PMK/ica
<PAGE>
EXHIBIT 8
<PAGE>
EXHIBIT 8
March 1, 1995
Marshall & Ilsley Corporation
770 North Water Street
Milwaukee, Wisconsin 53202
Re: Federal Income Tax Consequences of Acquisition of Citizens
Bank of Delavan
Gentlemen:
We have acted as counsel for Marshall & Ilsley Corpo- ration
("M&I") in connection with the negotiation and execution of the Agreement and
Plan of Reorganization dated August 31, 1994 (the "Agreement") between M&I
and Citizens Bancorp of Delavan, Inc. ("Citizens Bancorp").
The following is a description of the relevant terms of the
transaction based on our examination of the Agreement and our understanding
of the related factual background. All terms not otherwise defined herein
shall have the same meaning as set forth in the Agreement.
Parties
M&I, a Wisconsin corporation, is a registered multi-bank holding
company under the Bank Holding Company Act of 1956, as amended (the "BHCA").
M&I's principal assets are the stock of its subsidiaries. M&I owned, as of
December 31, 1994, substantially all of the outstanding capital stock of 34
banks and savings associations with a total of 225 offices in Wisconsin and
12 offices in Arizona. M&I also owns a number of companies engaged in
businesses which are closely related to banking, including the businesses of
data processing, investment management, trust services, mortgage banking,
investment advice, commercial leasing, venture capital, brokerage services
and credit card processing. M&I Stock is listed on the National Association
of Securities Dealers Automated Quotations/National Market System (the
"NASDAQ/NMS").
M&I Interim Corp. ("Interim"), a Wisconsin corporation, is a
wholly-owned subsidiary of M&I organized solely for the purpose of effecting
the merger of Citizens Bancorp with and into Interim (the "Merger").
<PAGE>
Citizens Bancorp, a Wisconsin corporation, is a registered one-
bank holding company under the BHCA. Its principal asset is 100% of the
stock of Citizens Bank of Delavan (the "Bank").
The Bank, a Wisconsin state bank, provides retail and commercial
banking services for customers in Walworth County in Wisconsin.
Proposed Transaction
Pursuant to Section 1.01 of the Agreement, at the Effective Time,
Citizens Bancorp will be merged with and into Interim. Under Section 2.02 of
the Agreement, each share of Bancorp Stock outstanding at the Effective Time,
other than treasury shares and Dissenting Shares, will be converted into the
right to receive 305.85 shares of M&I Stock. Under Section 2.03 of the
Agreement, each shareholder of Citizens Bancorp will receive cash in lieu of
any fractional shares of M&I Stock to which he would otherwise be entitled in
the Merger.
Immediately after the Merger, the corporation formed by the
merger of Citizens Bancorp into Interim (the "Surviving Corporation") will be
merged upstream into M&I in a transaction which will be treated as a
liquidation for tax purposes. This will result in M&I owning directly all of
the stock of the Bank. Thereafter, the Bank will change its name to M&I Bank
of Delavan.
With regard to M&I's purpose for entering into the Agreement, M&I
believes the acquisition of the Bank will allow M&I to enter and expand its
operations in the part of the state in which the Bank is located and to
enhance efficiencies through the consolidation of duplicate operations. M&I
believes that the Bank represents a unique partner for M&I's expansion as the
markets served by the Bank and its product offerings provide an excellent
complement to those of M&I.
From the perspective of Citizens Bancorp and the Bank, the
affiliation with M&I will give the Bank access to a range of financing
alternatives to raise capital which are not available to a single bank. In
addition, the Bank, through its affiliation with M&I, will be able to improve
and expand its services and take advantage of the expertise contained in the
larger M&I organization. Further, the Bank will be able to participate with
other banks owned by M&I in extending credit to customers whose needs could
not be met by the Bank standing alone.
<PAGE>
Factual Representations
In rendering our opinion, we have relied on representations
received from M&I, Citizens Bancorp or shareholders holding at least five
percent of the Bancorp Stock, where appropriate, as to the following:
1. The Citizens Bancorp shareholders who own at least five
percent of the Bancorp Stock, and to the best of the knowledge of Citizens
Bancorp's management, the remaining Citizens Bancorp shareholders, have no
plan or intention to sell, exchange or otherwise dispose of a number of
shares of M&I Stock received in the Merger that would reduce the
shareholders' ownership of M&I Stock to a number of shares having a value, as
of the Effective Time, of less than 50 percent of the value of all of their
former collective interests in the Bancorp Stock as of the same date. For
purposes of this representation, shares of Bancorp Stock exchanged for cash
in lieu of fractional shares of M&I Stock will be treated as outstanding
Citizens Bancorp Stock at the Effective Time. Moreover, M&I Stock and
Bancorp Stock which is otherwise sold, redeemed or disposed of before or
after the Effective Time will be considered in making this representation.
2. Interim will acquire at least 90 percent of the fair market
value of the net assets and at least 70 percent of the fair market value of
the gross assets held by Citizens Bancorp immediately prior to the Merger.
For purposes of this representation, amounts paid by Citizens Bancorp to
dissenters, amounts used by Citizens Bancorp to pay its reorganization
expenses, amounts paid by Citizens Bancorp to shareholders who receive cash
or other property, and all redemptions and distributions (except for regular,
normal dividends) made by Citizens Bancorp immediately preceding the transfer
will be included as assets of Citizens Bancorp held immediately prior to the
Merger.
3. M&I has no plan or intention to reacquire any of its stock
issued in the Merger; however, M&I has an ongoing program to repurchase its
stock in the open market.
4. Neither Interim nor M&I has any plan or intention to sell
or otherwise dispose of any of the assets of Citizens Bancorp acquired in the
transactions, except for dispositions made in the ordinary course of business
or transfers of assets to a corporation controlled by the Bank.
<PAGE>
5. The liabilities of Citizens Bancorp, if any, assumed by
Interim and the liabilities to which the transferred assets of Citizens
Bancorp are subject, if any, were incurred by Citizens Bancorp in the
ordinary course of its business.
6. Following the transaction, M&I will use a significant
portion of Citizens Bancorp's historic business assets in a business.
7. M&I, Interim, Citizens Bancorp and its shareholders will
pay their respective expenses, if any, incurred in connection with the
transaction.
8. There is no intercorporate indebtedness existing between
Interim or M&I, on the one hand, and Citizens Bancorp, on the other, that was
issued, acquired or will be settled at a discount.
9. M&I does not own, directly or indirectly, nor has it owned
during the past five years, directly or indirectly, any stock of Citizens
Bancorp.
10. The fair market value of the assets of Citizens Bancorp
transferred to Interim will equal or exceed the sum of the liabilities
assumed by Interim, if any, plus the amount of liabilities, if any, to which
the transferred assets are subject.
11. None of the compensation received by any shareholders who
are employees of Citizens Bancorp or the Bank ("shareholder-employees") will
be separate consideration for, or allocable to, any of their shares of
Bancorp Stock. None of the shares of M&I Stock received by any shareholder-
employees will be separate consideration for, or allocable to, any employment
agreement. Compensation paid to any shareholder-employees will be for
services actually rendered and will be commensurate with amounts paid to
third parties bargaining at arm's-length for similar services.
12. The payment of cash in lieu of fractional shares of M&I
Stock is solely for the purpose of avoiding the expense and inconvenience to
M&I of issuing fractional shares and does not represent separately bargained
for consideration. The total cash consideration that will be paid in the
transaction to the Citizens Bancorp shareholders instead of issuing
fractional shares of M&I Stock will not exceed one percent of the total
consideration that will be issued to the Citizens Bancorp shareholders in
exchange for their shares of Bancorp Stock.
<PAGE>
Conclusions
Based on (i) our examination of the Agreement, (ii) the foregoing
description and representations set forth above, (iii) the foregoing
description and the representations set forth above remaining true in all
material respects at the Effective Time, (iv) holders of not more than 5% in
the aggregate of the Bancorp Stock dissenting from the Merger and (v)
assuming that the transaction is consummated in accordance with the terms of
the Agreement, it is our opinion for federal income tax purposes:
l. The formation of Interim and the Merger, followed by the
merger of the Surviving Corporation into M&I (treated as a liquidation for
federal income tax purposes), will be disregarded for federal income tax
purposes, and the transaction will be treated as an acquisition of
substantially all of the assets of Citizens Bancorp by M&I in exchange for
M&I Stock and the assumption of the liabilities, if any, of Citizens Bancorp
plus the liabilities, if any, to which such assets are subject. Rev. Rul.
67-274, 1967-2 CB 141.
2. The acquisition by M&I of substantially all of the assets
of Citizens Bancorp solely in exchange for M&I Stock and the assumption by
M&I of the liabilities, if any, of Citizens Bancorp plus the liabilities to
which such assets are subject, as described above, followed by the
distribution of the M&I Stock to the Citizens Bancorp shareholders in
exchange for all their shares of Bancorp Stock in complete liquidation of
Citizens Bancorp will be a reorganization within the meaning of Section
368(a)(1)(C) of the Internal Revenue Code of 1986, as amended (the "Code").
3. Pursuant to Code Sections 361 and 357(a), no gain or loss
will be recognized to Citizens Bancorp upon the transfer of substantially all
of its assets to M&I in exchange for M&I Stock, and the assumption by M&I of
the liabilities of Citizens Bancorp, if any.
4. Pursuant to Code Section 1032(a), no gain or loss will be
recognized by M&I upon the receipt of the Citizens Bancorp assets in exchange
for M&I Stock.
5. Pursuant to Code Section 362(b), the basis of the assets of
Citizens Bancorp in the hands of M&I will be, in each instance, the same as
the basis of those assets in the hands of Citizens Bancorp immediately prior
to the proposed transaction.
<PAGE>
6. Pursuant to Code Section 1223(2), the holding period of
Citizens Bancorp's assets in the hands of M&I will include the period during
which the assets were held by Citizens Bancorp.
7. Pursuant to Code Section 354(a)(1), no gain or loss will be
recognized to the shareholders of Citizens Bancorp upon the receipt of M&I
Stock in exchange for Bancorp Stock.
8. Pursuant to Code Section 358(a)(1), the basis of the M&I
Stock received by the Citizens Bancorp shareholders will be the same as the
basis of the Bancorp Stock received in exchange therefor.
9. Pursuant to Code Section 1223(1), the holding period of the
M&I Stock received by the Citizens Bancorp shareholders will include the
period during which the Citizens Bancorp Stock was held, provided that such
stock is held as a capital asset in the hands of the Citizens Bancorp
shareholders on the date of the exchange.
10. The payment of cash to the Citizens Bancorp shareholders in
lieu of fractional shares of M&I Stock will be treated as if the fractional
shares were distributed as part of the exchange and then redeemed. These
payments will be treated as having been received as distributions in full
payment in exchange for stock redeemed as provided in Code Section 302(a).
Rev. Rul. 66-365, 1966-2 C.B. 116 and Rev. Proc. 77-41, 1977-2 C.B. 574.
11. Where a dissenting shareholder receives solely cash in
exchange for his Bancorp Stock, such cash will be treated as having been
received by the stockholder as a distribution in redemption of his Bancorp
Stock subject to the provisions and limitations of Code Section 302. Rev.
Rul. 74-502, 1974-2 C.B. 116.
Our opinion is not, nor should it be construed or relied upon as,
a guaranty, nor is it in any way binding on the Internal Revenue Service. It
is intended only to reflect our best professional judgment as to the matters
set forth herein as of the date hereof.
<PAGE>
We consent to the use of this opinion as an exhibit to the
Registration Statement. In giving this consent, however, we do not admit
that we are "experts" within the meaning of Section 11 of the Securities Act
of 1933, as amended, or within the category of persons whose consent is
required by Section 7 of said Act.
Very truly yours,
GODFREY & KAHN, S.C.
<PAGE>
EXHIBIT 23.1
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this Registration Statement on Form S-4 of our
report dated January 28, 1994 in Marshall & Ilsley Corporation's Annual
Report on Form 10-K for the year ended December 31, 1993, and our report
dated May 31, 1994 in Marshall & Ilsley Corporation's Current Report on Form
8-K dated September 26, 1994, and to all references to our firm in this
Registration Statement.
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin,
March 1, 1995
<PAGE>
EXHIBIT 23.2
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
inclusion in this Registration Statement on Form S-4 of our report dated
February 3, 1995 relating to Citizens Bancorp of Delavan, Inc.'s consolidated
statement of financial position at December 31, 1994 and statements of
income, changes in shareholders' equity and cash flow for the year ended
December 31, 1994, and to all references to our firm in this Registration
Statement.
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin,
March 1, 1995
<PAGE>
EXHIBIT 24
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Richard A. Abdoo
-----------------------------------------
Richard A. Abdoo
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Oscar C. Boldt
-----------------------------------------
Oscar C. Boldt
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ J.P. Bolduc
-----------------------------------------
J.P. Bolduc
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Wendell F. Bueche
-----------------------------------------
Wendell F. Bueche
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ J.F. Chait
-----------------------------------------
J.F. Chait
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Glenn A. Francke
-----------------------------------------
Glenn A. Francke
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ G.H. Gunnlaugsson
-----------------------------------------
G.H. Gunnlaugsson
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Burleigh E. Jacobs
-----------------------------------------
Burleigh E. Jacobs
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Jack F. Kellner
-----------------------------------------
Jack F. Kellner
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ James F. Kress
-----------------------------------------
James F. Kress
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ D.J. Kuester
-----------------------------------------
D.J. Kuester
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Edward L. Meyer, Jr.
-----------------------------------------
Edward L. Meyer, Jr.
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Don R. O'Hare
-----------------------------------------
Don R. O'Hare
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ San W. Orr, Jr.
-----------------------------------------
San W. Orr, Jr.
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Peter M. Platten, III
-----------------------------------------
Peter M. Platten, III
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ J.A. Puelicher
-----------------------------------------
J.A. Puelicher
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Stuart W. Tisdale
-----------------------------------------
Stuart W. Tisdale
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ J.B. Wigdale
-----------------------------------------
J.B. Wigdale
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ James O. Wright
-----------------------------------------
James O. Wright
<PAGE>
DIRECTOR'S POWER OF ATTORNEY
The undersigned Director of Marshall & Ilsley Corporation, a
Wisconsin corporation, hereby constitutes and designates each of J.B.
Wigdale, G. H. Gunnlaugsson and M.A. Hatfield, with the power of
substitution, the true and lawful attorney-in-fact of the undersigned to sign
for him in his name, place and stead, in any and all capacities, the
Registration Statement on Form S-4 of Marshall & Ilsley Corporation relating
to the proposed acquisition of the Citizens Bancorp of Delavan, Inc., and any
and all amendments (including post-effective amendments) and/or supplements
to said Form S-4, generally to do all such things in his name and behalf in
his capacity as a director to enable Marshall & Ilsley Corporation to comply
with the provisions of the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and all requirements of the Securities and
Exchange Commission, hereby ratifying and confirming his signature as it may
be signed by said attorney-in-fact to said Form S-4 and any and all
amendments (including post-effective amendments) and/or supplements thereto.
Dated this 23rd day of August, 1994.
/s/ Gus A. Zuehlke
-----------------------------------------
Gus A. Zuehlke
<PAGE>
EXHIBIT 99
<PAGE>
Citizens Bancorp of Delavan, Inc.
PROXY SOLICITED ON BEHALF OF CITIZENS BANCORP'S
BOARD OF DIRECTORS
Please sign and return immediately
Known all men by these presents that, I, the undersigned
shareholder of Citizens Bancorp of Delavan, Inc., do hereby appoint
Rymund P. Wurlitzer and Daniel W. Brown as my true and lawful attorneys,
with full power of substitution, for me and in my name, to vote at the
special meeting of stockholders of said corporation, to be held
on the ___ day of _______________, 1995, or any adjournment of said meeting,
with all powers I should have if personally present, hereby revoking all
proxies heretofore given, as follows:
Agreement and Plan of Reorganization
Proposal to approve the Agreement and Plan of Reorganization
dated August 31, 1994, between Citizens Bancorp and Marshall &
Ilsley Corporation ("M&I") and a related Agreement and Plan of
Merger between M&I Interim Corp., which is a wholly-owned
subsidiary of M&I, and Citizens Bancorp, pursuant to which
Citizens Bancorp will be merged with and into M&I Interim Corp.
(the "Merger") and each outstanding share of Citizens Bancorp's
Common Stock, $1.00 par value, will be converted into the right
to receive 305.85 shares of M&I's Common Stock, $1.00 par value,
and cash in lieu of fractional shares.
VOTE FOR VOTE AGAINST ABSTAIN
[ ] [ ] [ ]
The above item is proposed by the Board of Directors, and it
recommends a vote in favor of such item.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE,
THIS PROXY WILL BE VOTED FOR THE PROPOSAL.
I confer discretionary authority on the above-named individuals
with respect to any other matters which properly come before the meeting,
which approval shall not constitute ratification of actions taken at that
meeting.
IN EXERCISING DISCRETIONARY AUTHORITY, SHARES WILL BE VOTED
ACCORDING TO THE RECOMMENDATIONS OF THE BOARD OF DIRECTORS.
Dated: _____________________, 1995 ___________________________________
(please fill in date) (Signature of Stockholder)
___________________________________
(Signature of Stockholder)
(When signing as personal representative, trustee, guardian, etc., please
give your full title. If more than one trustee, all should sign, unless any
one person is authorized to act. If shares are held in joint names, either
or both may sign.)
