<PAGE> 1
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
AND EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
W.H. Brady Co.
- -----------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- -----------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
_______________________________________________________
2) Aggregate number of securities to which transaction applies:
_______________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
_______________________________________________________
4) Proposed maximum aggregate value of transaction:
_______________________________________________________
QB1\260793.7
<PAGE> 2
5) Total fee paid:
$125.00
[X] Fee paid previously with preliminary materials: $125.00
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
_______________________________________________________
2) Form, Schedule or Registration Statement No.:
_______________________________________________________
3) Filing Party:
_______________________________________________________
4) Date Filed:
_______________________________________________________
QB1\260793.7 2
<PAGE> 3
W.H. BRADY CO.
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
FRIDAY, NOVEMBER 17, 1995
To The Holders of W.H. Brady Co. Class A Common Stock:
NOTICE IS HEREBY GIVEN that a special meeting of the shareholders of W.H.
Brady Co. (the "Company") will be held at the Wyndham Hotel, 139 East Kilbourn
Avenue, Milwaukee, Wisconsin 53202 on Friday, November 17, 1995 at 9:00 a.m. to
consider and act upon the following matters:
1. A proposal to amend Article III of the Restated Articles of Incorporation
of the Company to increase the number of shares which the Company has authority
to issue from 25,045,000 to 115,045,000, consisting of an increase in the
number of authorized shares of Class A Common Stock from 10,000,000 to
100,000,000.
2. To approve the proposed dividend of two shares of Class A Common Stock on
each outstanding share of Class A Common Stock and Class B Common Stock.
3. To transact such other business as may properly come before the meeting or
any adjournments or postponements thereof.
The close of business on October 6, 1995 has been fixed as the record date
for determination of shareholders entitled to notice of, and to vote at, the
meeting and any adjournments or postponement thereof.
The matters to be acted upon at the meeting are described in more detail in
the accompanying Proxy Statement/Prospectus. Approval of both proposal 1 and
proposal 2 requires an affirmative vote of a majority of the outstanding shares
of each of the Class A and Class B Common Stock, voting separately. Holders of
the Class B stock have indicated their intent to vote for the proposals. THE
BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS 1 AND 2.
It is important that your shares be represented at the meeting. Whether or
not you plan to attend the meeting, you are requested to indicate your voting
directions, sign, date and promptly return your proxy in the enclosed postpaid
envelope. If you later desire to revoke your proxy, you may do so at any time
before the voting by giving written notice of revocation to the Company's
Secretary, or by giving oral notice to the presiding officer during the
meeting.
A copy of the 1995 Annual Report to Shareholders and a Proxy
Statement/Prospectus accompany this Notice.
By Order of the Board of Directors
______________________________
Peter J. Lettenberger
Secretary
October __, 1995
6555 West Good Hope Road
Milwaukee, Wisconsin 53223
QB1\260793.7 1
<PAGE> 4
PROXY STATEMENT/PROSPECTUS
W.H. BRADY CO.
6555 WEST GOOD HOPE ROAD
MILWAUKEE, WISCONSIN 53223
(414) 358-6600
SOLICITATION AND VOTING
The enclosed proxy is solicited by the Board of Directors of W.H. Brady Co.
("Brady" or the "Company") for use at the Special Meeting of Shareholders to be
held on November 17, 1995. The meeting will be held in conjunction with the
regular Annual Meeting of the Company's Class B Common Stock shareholders. All
properly executed proxies will be voted at the meeting. A proxy may be revoked
at any time prior to its exercise by giving written notice of revocation to the
Company's Secretary, or by giving oral notice to the presiding officer during
the meeting.
Each holder of record of Class A Common Stock and Class B Common Stock at the
close of business on October 6, 1995, will be entitled to one vote for each
share registered in such shareholder's name on proposals one and two. At that
date, there were outstanding 5,507,599 shares of Class A Common Stock and
1,769,314 shares of Class B Common Stock. Approval of both the proposal to
amend Article III of the Restated Articles of Incorporation (the "Proposed
Amendment") and the proposed stock dividend of two shares of Class A Common
Stock on each outstanding share of Class A and Class B Common Stock (the
"Proposed Dividend") requires the affirmative vote of a majority of the issued
and outstanding shares of each of the Class A Common Stock and the Class B
Common Stock, voting separately. The holders of the Class B Common Stock have
indicated their intent to vote for both proposals. Each share of Class B
Common Stock entitles its holder to vote for all other matters properly coming
before the meeting. Holders of Class A Common Stock are not entitled to vote
on other matters coming before the meeting, except as may be required by law.
This Proxy Statement/Prospectus constitutes a prospectus of the Company with
respect to approximately 14,553,560 shares of Class A Common Stock to be issued
by the Company if both the Proposed Amendment and the Proposed Dividend are
approved. There will be no proceeds to the Company from the Proposed Amendment
or from the Proposed Dividend, because shareholders would receive the Proposed
Dividend as a stock dividend. The expense of printing and mailing the proxy
material, including forwarding expenses to beneficial owners of stock held in
the name of another, will be borne by the Company. No solicitation other than
by mail is contemplated, except that officers or employees of the Company may
solicit the return of proxies from certain shareholders by telephone.
This Proxy Statement is being mailed to shareholders of record commencing on
or about October __, 1995. A copy of the 1995 Annual Report to Shareholders,
including financial statements, is enclosed herewith.
___________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
__________________
No person is authorized to give any information or to make any
representations other than those contained or incorporated by reference in this
Proxy Statement/Prospectus, and if given or made, such information or
representation should not be relied upon as having been authorized. This Proxy
QB1\260793.7
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Statement/Prospectus does not constitute an offer to sell, or a solicitation of
an offer to purchase, any security in any jurisdiction, to or from any person
to or from whom it is unlawful to make such offer or solicitation or an offer
in such jurisdiction. Neither the delivery of this Proxy Statement/Prospectus
nor any distribution of the Proposed Dividend shall, under any circumstances,
create an implication that there has been no change in the affairs of the
Company since the date of this Proxy Statement/Prospectus.
This Proxy Statement/Prospectus does not cover any resale of the shares of
Class A Common Stock to be received by shareholders of the Company in the
Proposed Dividend, and no person is authorized to make use of this Proxy
Statement/Prospectus in connection with any such resale.
The date of this Proxy Statement/Prospectus is October __, 1995.
QB1\260793.7 2
<PAGE> 6
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and in accordance
therewith files reports, proxy or information statements and other information
with the Securities and Exchange Commission (the "SEC"). Such reports,
statements and other information filed with the SEC may be inspected and copied
at the public reference facilities maintained by the SEC at 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the SEC's regional offices located at 7
World Trade Center, New York, NY, 10048 and at Northwestern Atrium Center, 500
West Madison Street, Suite 1400, Chicago, IL 60601.
The Company has filed with the SEC under the Securities Act of 1933, as
amended (the "Securities Act"), a registration statement on Form S-3 (together
with all amendments, schedules and exhibits thereto, the "Registration
Statement") with respect to the shares of Class A Common Stock issuable
pursuant to the Proposed Dividend. This Proxy Statement/Prospectus does not
contain all of the information set forth in or incorporated by reference in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the SEC. The Registration Statement is available
for inspection and copying as set forth above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
This Proxy Statement/Prospectus incorporates documents by reference which are
not delivered herewith. These documents are available, without charge, to each
person, including any beneficial owner, to whom a copy of this Proxy
Statement/Prospectus is delivered, upon written or oral request to Donald P.
DeLuca, 6555 West Good Hope Road, Milwaukee, Wisconsin, 53223 (telephone
number: 414-358-6600). In order to ensure timely delivery of documents, any
request should be made by ____________, 1995.
The following documents filed by the Company with the SEC pursuant to the
Exchange Act (File No. 0-12730) are incorporated in this Proxy
Statement/Prospectus by reference:
1. The Company's Annual Report on Form 10-K for the year ended July 31,
1995.
2. The description of the Class A Common Stock contained in the Company's
registration statement under the Exchange Act on Form 8-A.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date hereof and prior to the date on which
the Special Meeting is held shall be deemed to be incorporated herein by
reference and to be a part hereof from the date of filing of such documents.
The information contained in this Proxy Statement/Prospectus does not purport
to be comprehensive and should be read together with the information contained
in the documents incorporated by reference herein.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Proxy Statement/Prospectus 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 herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed to
constitute a part of this Proxy Statement/Prospectus, except as so modified or
superseded.
PRINCIPAL SECURITY HOLDERS AND SECURITY HOLDINGS
OF MANAGEMENT
The following table contains information as to the beneficial ownership of
the Company's Class A Common Stock, Class B Common Stock and Cumulative
Preferred Stock by each Director, each person known to own more than 5% of any
class of such security, and all Directors and executive officers as a group as
of August 31, 1995. This beneficial ownership information is based upon
information furnished by the specified
QB1\260793.7 3
<PAGE> 7
persons and determined in accordance with Rule 13d-3 under the Securities
Exchange Act of 1934 as required for purposes of this Proxy
Statement/Prospectus, which is not necessarily the same as beneficial ownership
for other purposes, and includes shares as to which beneficial ownership may be
disclaimed. Except as otherwise indicated, all shares are owned directly.
QB1\260793.7 4
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<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER AND AMOUNT OF BENEFICIAL PERCENT OF
TITLE OF CLASS NATURE OF BENEFICIAL OWNERSHIP OWNERSHIP OWNERSHIP
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Class A Common Peter J. Lettenberger (1)(2)(3) 1,109,963 20.2%
Stock Irene B. Brady (1)(2) 1,108,372 20.2%
Richard A. Bemis (1)(4) 849,431 15.4%
Robert C. Buchanan (1)(4) 849,231 15.4%
Roger D. Peirce (1)(4) 848,931 15.4%
Elizabeth B. Lurie (2)(5) 559,290 10.2%
William H. Brady III 345,824 6.3%
Katherine M. Hudson (6) 30,370 0.6%
Donald P. DeLuca(7) 13,500 0.2%
Gary R. Nei 1,500 *
Frank W. Harris 500 *
All Executive Officers and
Directors as a Group 1,842,186 33.0%
(17 persons) (8)
Class B Common Peter J. Lettenberger (1) 1,769,314 100%
Stock Irene B. Brady (1)(2) 1,769,314 100%
Robert C. Buchanan (1) 1,769,314 100%
Roger D. Peirce (1) 1,769,314 100%
Richard A. Bemis (1) 1,769,314 100%
All Executive Officers and
Directors as a Group 1,769,314 100%
6% Cumulative Peter J. Lettenberger (1)(2) 2,751 69.1%
Preferred Stock Irene B. Brady (1)(2) 1,988 49.9%
Robert C. Buchanan (1) 1,920 48.2%
Roger D. Peirce (1) 1,920 48.2%
Richard A. Bemis (1) 1,920 48.2%
Elizabeth B. Lurie (2)(5) 1,066 26.8%
William H. Brady III 235 5.9%
All Executive Officers and
Directors as a Group 3,221 80.8%
1979 Series Elizabeth B. Lurie (2)(5) 8,071 36.7%
Cumulative Peter J. Lettenberger (2) 5,529 25.2%
Preferred Stock William H. Brady III 2,542 11.6%
All Officers and Directors
as a Group 10,613 48.3%
6% Cumulative Peter J. Lettenberger (2) 2,600 100%
Preferred Stock, Elizabeth B. Lurie (2) 2,600 100%
1972 Series All Executive Officers and
Directors as a Group 2,600 100%
</TABLE>
__________________________________
*Indicates less than one tenth of one percent.
QB1\260793.7 5
<PAGE> 9
(1) The amount shown includes shares held directly by the William H. Brady,
Jr. Marital Trust (the "Marital Trust") and the William H. Brady, Jr. Non-QTIP
Marital Trust (the "Non-QTIP Trust) (collectively, the "Trusts"). The Marital
Trust owns 687,781 shares of Class A Common Stock, 1,574,866 shares of Class B
Common Stock, and 1,709 shares of 6% Cumulative Preferred Stock. The Non-QTIP
Trust owns 160,650 shares of Class A Common Stock, 194,448 shares of Class B
Common Stock, and 211 shares of 6% Cumulative Preferred Stock. The Trustees of
both Trusts are Robert C. Buchanan, Irene B. Brady, Roger D. Peirce, Peter J.
Lettenberger, and Richard A. Bemis, each of whom shares voting and dispositive
power. All of the Trustees except Mrs. Brady disclaim beneficial ownership of
these shares. Irene B. Brady is the widow of William H. Brady, Jr. and the
vested beneficiary of the Marital Trust; she is the parent of William H. Brady,
III and Elizabeth Brady Lurie (who are contingent remainder beneficiaries of
the Trusts) and the grandparent of Elizabeth Irene Pungello.
(2) Elizabeth B. Lurie and Peter J. Lettenberger are among the directors of
the W.H. Brady Foundation, Inc. (the "Foundation") which owns 5,529 shares of
the 1979 Series, Cumulative Preferred Stock, 763 shares of the 6% Cumulative
Preferred Stock and 2,600 shares of the 6% Cumulative Preferred Stock, 1972
Series. Mr. Lettenberger and Mrs. Lurie are also trustees of the Irene B.
Brady Revocable Trust of 1986 (the "1986 Trust"), which owns 259,941 shares of
Class A Common Stock and 68 shares of 6% Cumulative Preferred Stock. All such
persons disclaim beneficial ownership of shares held by the Foundation and the
1986 Trust.
(3) In addition to shares beneficially owned as a trustee of the Trusts and
the 1986 Trust and as a director of the Foundation, Mr. Lettenberger owns
directly 1,590.93 shares of Class A Common Stock.
(4) In addition to shares beneficially owned as a trustee of the Trusts, Mr.
Buchanan owns directly 600 shares of Class A Common Stock and 200 shares
through his Keogh Plan; Mr. Peirce owns 500 shares of Class A Common Stock; and
Mr. Bemis owns 1,000 shares of Class A Common Stock.
(5) In addition to the shares owned as a trustee of the 1986 Trust and as a
director of the Foundation, Mrs. Lurie owns directly 141,615 shares of Class A
Common Stock, or 2.3% of the number of such shares outstanding, 235 shares of
6% Cumulative Preferred Stock and 2,542 shares of 1979 Series Preferred Stock.
She is the mother of Elizabeth Irene Pungello, who is the beneficiary of the
Elizabeth Irene Pungello Irrevocable Trust (the trustees of which are Nicholas
M. Daniels and Shy Lurie, Mrs. Lurie's husband) which owns 157,734 shares of
the Class A Common Stock, or 2.9% of the number of such shares outstanding.
She disclaims ownership of these shares.
(6) Mrs. Hudson owns 2,036.42 shares of Class A Common Stock and vested
options to acquire an additional 28,333.3 shares of Class A Common Stock.
(7) Mr. DeLuca owns 500 shares of Class A Common Stock and vested options to
acquire an additional 13,000 shares of Class A Common Stock.
(8) The amount shown for all executive officers and directors as a group (17
persons) includes options to acquire a total of 79,268 shares of Class A Common
Stock which are currently exercisable or will be exercisable within 60 days.
It does not include other options for Class A Common Stock which have been
granted, but vest at times after October 31, 1995.
QB1\260793.7 6
<PAGE> 10
PROPOSED AMENDMENT TO INCREASE AUTHORIZED SHARES
At the Special Meeting of Shareholders, shareholders will be asked to vote
upon a proposal to amend Section A.1. of Article III of the Company's Restated
Articles of Incorporation (the "Proposed Amendment") to increase the number of
shares of stock the Company is authorized to issue from 25,045,000 to
115,045,000, consisting of an increase in the number of authorized shares of
Class A Common Stock from 10,000,000 to 100,000,000. Copies of both the
existing provision and the Proposed Amendment are attached as Exhibits A and B,
respectively.
The principal purpose for increase in the number of authorized shares of the
Company's Class A Common Stock is the payment of a stock dividend, described in
the following proposal. The additional shares may also be issued at such time,
for such consideration, and for such uses as the Board of Directors may
determine to be in the Company's best interest. Such uses might include, among
other things, future acquisitions, financing arrangements requiring stock,
stock splits, future stock dividends, or stock option plans. Except for use in
paying the proposed stock dividend described below, however, the Board has no
present plans to issue any of the additional shares proposed to be authorized.
The additional shares of Class A Common Stock would be available for issuance
without further action by the shareholders, and without the expense and delay
of calling a special shareholders' meeting.
Adoption of the Proposed Amendment requires the affirmative vote of the
holders of a majority of the issued and outstanding shares of Class A Common
Stock, voting as a class, and the affirmative vote of a majority of the issued
and outstanding shares of Class B Common Stock, voting as a separate class.
The holders of the Class B Common Stock have expressed their intention to vote
in favor of the Proposed Amendment.
The Board of Directors has unanimously approved the Proposed Amendment to the
Company's Restated Articles of Incorporation and recommends that the
shareholders vote to adopt it.
PROPOSAL FOR STOCK DIVIDEND
If the shareholders approve the Proposed Amendment to increase the number of
authorized shares of the Company's Class A Common Stock, and if the Company
receives a favorable tax ruling from the Internal Revenue Service, the Board of
Directors proposes to declare a dividend of two shares of Class A Common Stock
on each outstanding share of Class A Common Stock and Class B Common Stock (the
"Proposed Dividend"). If the Proposed Amendment is not approved, the Company
will not have sufficient authorized, but unissued, shares of Class A Common
Stock for the Board to declare the Proposed Dividend and such dividend will not
be declared, notwithstanding the affirmative vote of shareholders on this
proposal.
The Board of Directors has determined to declare the Proposed Dividend of two
shares of Class A Common Stock on each outstanding share of Class A Common
Stock and Class B Common Stock only if such dividend is approved by the vote of
a majority of the outstanding shares of each of the Class A and Class B Common
Stock, voting separately.
In analyzing the Proposed Dividend, it is important to keep in mind the
relative rights of holders of Class A Common Stock and Class B Common Stock.
Holders of Class A Common Stock are not entitled to vote on any corporate
matters, except as may be required by law, and holders of Class B Common Stock
are entitled to vote on all matters properly presented to shareholders for
vote.
There also are differences in the cash dividend rights of the Class A and
Class B Common Stock. Whenever dividends (other than dividends payable solely
in shares of the Company's stock) are paid on the
QB1\260793.7 7
<PAGE> 11
common stock, each share of Class A Common Stock is entitled to receive
dividends at an annual rate of $.10 in cash (subject to adjustment in the event
of any subdivision, combinations, stock splits or stock dividends) before any
dividend is paid on the Class B Common Stock.
In addition, in the event of liquidation of the Company, holders of the Class
A Common Stock are entitled to first receive $5.00 per share (subject to
adjustment as described above), then holders of the Class B Common Stock are
entitled to receive the next $5.00 per share (again subject to the adjustments
described above), and thereafter they share pro rata.
If the Proposed Dividend is approved and paid, the annual dividend "premium"
on the Class A Common Stock will automatically be adjusted from $.10 per share
to $.0333 per share. In addition, if the Proposed Amendment and the Proposed
Dividend are approved, the liquidation preference amounts for both the Class A
and Class B Common Stock will, as a result of the stock dividend, be
automatically adjusted from $5.00 per share to $1.666 per share.
In determining to recommend the Proposed Dividend, the Board of Directors
considered that the present supply of the Company's Class A Common Stock in the
public market is relatively limited (approximately 3,650,960 shares at August
31, 1995 were held by persons other than those described under "Principal
Security Holders and Security Holdings of Management") and that the closing
price of a share of Class A Common Stock on the NASDAQ National Market has
increased from $48.50 on August 31, 1994 to $73.00 on August 31, 1995. The
Proposed Dividend would have the effect of tripling the number of shares of the
Company's Class A Common Stock in the public market and reducing the market
price per share to approximately one-third of its current level. As a result
thereof, the Board believes that the Proposed Dividend would make the Company's
Class A Common Stock more attractive to investors than it is at current market
prices, create a broader market for the stock, increase investor interest in
the stock, and thereby encourage future growth in the value of the stock.
The Board further considered that a three for one stock split of both the
Class A Common Stock and the Class B Common Stock would achieve similar
results, but concluded that the Proposed Dividend has two advantages over such
a stock split. First, the increase in the number of outstanding shares of
Class A Common Stock resulting from the Proposed Dividend would be
approximately 32% greater than the increase in the number of outstanding shares
of Class A Common Stock which would result from a stock split. The Board of
Directors believes that this additional increase could further enhance the
breadth of the market for, and investor interest in, the Class A Common Stock.
The Board also considered that the Proposed Dividend would provide the
current holders of Class B Common Stock (who have no public market for their
Class B Common Stock) with a substantial potential increase in the liquidity of
their investment in the Company, without diminishing their voting position in
the Company. In particular, the Proposed Dividend would give the two trusts
that hold all of the outstanding shares of the Company's Class B Common Stock
the opportunity to dispose of part or all of the Class A Common Stock
distributed to them in the Proposed Dividend. The holders of the Company's
Class B Common Stock have advised the Company that, should the Proposed
Dividend be approved, they intend at some point in the future to sell some of
the Class A Common Stock which they currently own or which they would receive
in the proposed stock dividend in order to help them meet financial or estate
needs. Any such future sale would be made either by an offering registered
under the Securities Act of 1933 or pursuant to an applicable exemption from
the registration requirements of that Act. Any such sales by the present Class
B Common Stock holders would have the effect of further expanding the supply of
Class A Common Stock available in the public market.
The Board of Directors realizes that because the holders of the Class A
Common Stock are entitled to a $.10 per share cash dividend "premium" over the
cash dividend per share payable on the shares of Class B Common Stock, one of
the effects of the Proposed Dividend would be to increase the
QB1\260793.7 8
<PAGE> 12
aggregate cash dividend payable to the current Class B Common Stockholders.
Based upon the Company's current annual cash dividends at a rate of $1.20 per
share of Class A Common Stock and $1.10 per share of Class B Common Stock, the
holders of the Class B Common Stock would receive an additional $117,954, or
approximately 1.4% of the Company's annual dividend rate.
The Board of Directors anticipates that the distribution of additional shares
of the Company's Class A Common Stock as a result of the Proposed Dividend
would not be taxable to shareholders. The Board further anticipates that the
dividend shares, when aggregated with the shares of Common Stock upon which
they are paid, would have a basis for computing gain or loss equal to the
aggregate basis of the shares of Common Stock upon which the dividend shares
are paid and that a shareholder's holding period for the dividend shares would
include the holding period for the shares of Common Stock upon which the
dividend shares are paid. The Company has sought a tax ruling as to these
issues from the Internal Revenue Service. If a favorable ruling is not
obtained, the Proposed Dividend will not be declared and paid. Shareholders
should be aware that inasmuch as four of the members of the Board of Directors
are trustees of the trusts which own all of the Class B Common Stock, and two
other Directors are beneficiaries of the trusts, there may be an inherent
conflict of interest in their recommendation to vote in favor of the Proposed
Dividend. If the Proposed Dividend is declared and paid, a comparison of the
number and percentage of issued and outstanding Class A and Class B Common
Stock shares owned by the trusts before and after the stock dividend would be
as follows:
The William H. Brady, Jr. Marital Trust currently owns 687,781 shares (12.5%)
of the Class A Common Stock, 1,574,866 shares (89%) of the Class B Common
Stock, and 2,262,647 shares (31.1%) of both the Class A and Class B Common
Stock combined, and after the Proposed Dividend would own 5,213,075 shares
(26%) of the Class A Common Stock, 1,574,866 shares (89%) of the Class B Common
Stock, and 6,787,941 shares (31.1%) of both the Class A and Class B Common
Stock combined.
The William H. Brady, Jr. Non-QTIP Marital Trust currently owns 160,650
shares (2.9%) of the Class A Common Stock, 194,448 shares (11%) of the Class B
Common Stock, and 355,098 shares (4.9%) of both the Class A and Class B Common
Stock combined. After the Proposed Dividend, it would own 870,846 shares
(4.3%) of the Class A Common Stock, 194,448 shares (11%) of the Class B Common
Stock, and 1,065,294 shares (4.9%) of both the Class A and Class B Common Stock
combined.
The two William H. Brady, Jr. Trusts combined currently own 848,431 shares
(15.4%) of the Class A Common Stock, 1,769,314 shares (100%) of the Class B
Common Stock, and 2,617,745 shares (36%) of both the Class A and Class B Common
Stock combined. After the Proposed Dividend, they would own 6,083,921 shares
(30.3%) of the Class A Common Stock, 1,769,314 shares (100%) of the Class B
Common Stock, and 7,853,235 shares (36%) of the Class A and Class B Common
Stock combined.
AUDIT MATTERS
Representatives of Deloitte & Touche LLP, the independent auditors for the
Company, will be present at the Special Meeting of Shareholders to respond to
questions and to make a statement if they so desire.
OTHER MATTERS
At the date of this Proxy Statement/Prospectus, the Company has not been
informed and is not aware that any other matters will be brought before the
meeting. However, proxies may be voted with discretionary authority with
respect to any other matters that may properly be presented to the meeting and
on which the Class A Common Stock is entitled to vote.
QB1\260793.7 9
<PAGE> 13
SHAREHOLDER PROPOSALS
The Company holds annual informational meetings for its shareholders.
However, because of the limited voting rights of the Class A Common Stock, the
Company does not distribute proxy statements in connection with such meetings.
If the Company holds a meeting of shareholders for which a proxy statement is
distributed, shareholder proposals must be received at least 150 days prior to
such meeting in order to be considered for inclusion in the proxy statement for
such meeting.
VOTING PROCEDURES
Abstentions and broker non-votes are not considered to be votes cast under
applicable state law and the Company's Restated Articles of Incorporation and
Bylaws, although they are counted for purposes of determining a quorum. The
Class A Common Stock votes will be counted by the Company's transfer agent,
Firstar Trust Company, and certified to the Company in writing.
W.H. BRADY CO.
______________________________
Peter J. Lettenberger
Secretary
Milwaukee, Wisconsin
October __, 1995
A COPY (WITHOUT EXHIBITS) OF THE COMPANY'S ANNUAL REPORT TO THE SECURITIES
AND EXCHANGE COMMISSION ON FORM 10-K AND FINANCIAL STATEMENTS AND SCHEDULES
THERETO FOR THE FISCAL YEAR ENDED JULY 31, 1995 WILL BE PROVIDED WITHOUT CHARGE
TO EACH RECORD OR BENEFICIAL OWNER OF THE COMPANY'S COMMON STOCK AS OF THE
RECORD DATE FOR THE SPECIAL MEETING ON WRITTEN REQUEST OF SUCH PERSON DIRECTED
TO DONALD P. DELUCA, W.H. BRADY CO., 6555 WEST GOOD HOPE ROAD, MILWAUKEE,
WISCONSIN 53223.
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EXHIBIT A
W.H. BRADY CO.
ARTICLE III.A.1. OF THE ARTICLES
OF INCORPORATION AS PRESENTLY IN EFFECT
A. STOCK
The authorized capital stock of the Corporation shall consist of Twenty-Five
Million Forty-Five Thousand Shares (25,045,000), itemized by classes and
series as follows:
1. Twenty Million (20,000,000) Shares of Common Stock, one cent ($.01) par
value, divided into the following series:
(a) Ten Million (10,000,000) Shares of Class A Nonvoting Common Stock (the
"Nonvoting Common Stock"); and
(b) Ten Million (10,000,000) Shares of Class B Voting Common Stock (the
"Voting Common Stock") (the Nonvoting Common Stock and the Voting
Common Stock are hereinafter collectively referred to as the "Common
Stock").
QB1\260793.7 11
<PAGE> 15
EXHIBIT B
ARTICLE III.A.1. OF THE ARTICLES OF
INCORPORATION AS PROPOSED TO BE AMENDED
A. STOCK
The authorized capital stock of the Corporation shall consist of One Hundred
Fifteen Million Forty-Five Thousand Shares (115,045,000), itemized by classes
and series as follows:
1. One Hundred Ten Million (110,000,000) Shares of Common Stock, one cent
($.01) par value, divided into the following series:
(a) One Hundred Million (100,000,000) Shares of Class A Nonvoting Common
Stock (the "Nonvoting Common Stock"); and
(b) Ten Million (10,000,000) Shares of Class B Voting Common Stock (the
"Voting Common Stock") (the Nonvoting Common Stock and the Voting
Common Stock are hereinafter collectively referred to as the "Common
Stock").
QB1\260793.7 12
