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BADGER PAPER MILLS, INC.
(Name of Registrant as Specified in its Charter)
___________________________________
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[Badger Paper Mills, Inc. Letterhead]
March 2, 1998
Dear Badger Shareholder:
Under a separate letter, you have been notified that a "Special
Meeting of Badger Shareholders" has been called by Mr. Azzar. The purpose
of this meeting is to request that Badger shareholders consent to
reversing the State of Wisconsin statute 180.1150 that reduces the voting
power of stock held in excess of 20% to 10% of the full voting power of
those shares.
I believe the Wisconsin Statute was instituted to protect
shareholders from being subject to what is referred to as a "Creeping
Takeover", and that the law is designed to protect minority shareholders
from the actions of other shareholders who might control a large block of
stock, particularly where their interests may not reflect the interests of
minority shareholders.
Mr. Azzar's proposal asks you to remove such protection. I
strongly urge you to vote against Mr. Azzar's proposal and maintain the
protection currently afforded by the Wisconsin Statute.
Mr. Azzar has repeatedly criticized the Board for non-action and
for eroding shareholder value. As we have communicated to you over the
past three years, our efforts have been directed at repositioning Badger
and returning it to profitability. We have completed the closure of our
sulphite mill. We have invested in an up-to-date stock preparation
facility. We have disposed of our non-productive timberland holdings and
have announced the sale of other non-income producing assets. We recently
downsized our operations in Peshtigo, which is consistent with out
"repositioning strategy" focusing on specialty papers. All of the
foregoing are intended to hasten our return to profitability.
As Chairman of Badger, my number one goal has been to increase
shareholder value by returning the Company to profitability.
Additionally, I am firmly convinced that Badger can best do this as an
independent company and benefit all of its stakeholders; i.e.,
shareholders, customers, employees, suppliers and the community.
Very truly yours,
BADGER PAPER MILLS, INC.
/s/ Thomas J. Kuber
Thomas J. Kuber
Chairman
