FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended APRIL 2, 1994
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-6187
BANTA CORPORATION
(Exact name of registrant as specified in its charter)
WISCONSIN 39-0148550
(State or other jurisdiction (IRS Employer
of incorporation or organization) I.D. Number)
225 MAIN STREET, MENASHA, WISCONSIN 54952
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (414) 751-7777
"Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes /X/ No / /"
The registrant had outstanding on April 2, 1994, 20,037,763 shares of
$.10 par value common stock.
Page number of Exhibit Index 10
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BANTA CORPORATION AND SUBSIDIARIES
INDEX
PART I Financial Statements: PAGE NUMBER
Unaudited Consolidated Condensed Balance Sheets
April 2, 1994 and January 1, 1994 3
Unaudited Consolidated Condensed Statements of Earnings for
the Three Months Ended April 2, 1994 and April 3, 1993 4
Unaudited Consolidated Condensed Statements of Cash Flows
for the Three Months Ended April 2, 1994 and April 3, 1993 5
Notes to Unaudited Consolidated Condensed
Financial Statements 6
Management's Discussion and Analysis of Financial Condition
and Results of Operations 7-8
PART II Other Information and Signatures:
Item 4 - Submission of Matters to a Vote of Security Holders 8
Item 6 - Exhibits and Reports on Form 8-K 9
Exhibit Index 10
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<TABLE>
PART I Item 1 - Financial Statements
BANTA CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in Thousands)
<CAPTION>
ASSETS APRIL 2, 1994 JANUARY 1, 1994
<S> <C> <C>
Current Assets
Cash $ 873 $ 8,230
Receivables 134,043 125,004
Inventories 45,998 52,447
Other current assets 14,451 12,225
--------- ---------
Total Current Assets 195,365 197,906
--------- ---------
Plant and Equipment 471,031 430,357
Less Accumulated Depreciation 206,918 197,469
--------- ---------
Plant and Equipment, net 264,113 232,888
--------- ---------
Other Assets 8,863 9,303
Cost in Excess of Net Assets of Subsidiaries Acquired 17,205 17,336
--------- ---------
$ 485,546 $ 457,433
========= =========
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities
Notes Payable $ 29,175 $ 20,800
Accounts Payable 34,202 27,364
Accrued Salaries and Wages 15,372 16,903
Other Accrued Liabilities 24,662 19,807
Current Maturities of Long-term Debt 6,629 6,861
--------- ---------
Total Current Liabilities 110,040 91,735
--------- ---------
Long-term Debt 47,354 45,603
Deferred Income Taxes 17,639 18,257
Other Non-current Liabilities 10,466 9,410
Shareholders' Investment
Preferred Stock - $10 par value; authorized 300,000 shares;
none issued - -
Common Stock - $.10 par value; authorized 75,000,000 shares;
20,037,763 and 19,996,532 shares issued, respectively 2,004 2,000
Amount in Excess of Par Value of Stock 55,087 54,436
Retained Earnings 242,956 235,992
--------- ---------
300,047 292,428
--------- ---------
$ 485,546 $ 457,433
========= =========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
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<TABLE>
BANTA CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Dollars in Thousands, Except Per Share Amounts)
<CAPTION>
Three Months Ended
APRIL 2, 1994 APRIL 3, 1993
<S> <C> <C>
Net sales $ 187,464 $ 162,027
Cost of goods sold 146,400 125,820
--------- ---------
Gross earnings 41,064 36,207
Selling and administrative expense 24,046 21,519
--------- ---------
Earnings from operations 17,018 14,688
Other income (expense):
Interest expense (1,113) (1,362)
Other, net 60 246
--------- ---------
Earnings before income taxes 15,965 13,572
Provision for income taxes 6,400 5,300
--------- ---------
Net earnings $ 9,565 $ 8,272
========= =========
Earnings per share of common stock $ .47 $ .41
========= =========
Average common shares outstanding 20,243,003 20,106,294
========== ==========
Cash dividends per common share $ .13 $ .11
========= =========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
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<TABLE>
BANTA CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED
STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
<CAPTION>
Three Months Ended
APRIL 2, 1994 APRIL 3, 1993
<S> <C> <C>
Cash Flow From Operating Activities
Net earnings $ 9,565 $ 8,272
Depreciation and amortization 9,484 8,089
Deferred income taxes (618) (432)
Change in assets and liabilities
(Increase) decrease in receivables (1,447) 2,152
Decrease in inventories 8,055 917
Increase in other current assets (2,086) (331)
Increase in accounts payable
and accrued liabilities 5,595 137
Decrease (increase) in other non-current assets 618 (1,039)
Other, net 1,056 853
--------- ---------
Cash provided from operating activities 30,222 18,618
--------- ---------
Cash Flow From Investing Activities
Capital expenditures, net (26,489) (16,298)
Acquisition of business (16,331) -
--------- ---------
Cash used for investing activities (42,820) (16,298)
--------- ---------
Cash Flow From Financing Activities
Proceeds from notes payable, net 8,375 -
Repayment of long-term debt (1,188) (2,341)
Dividends paid (2,601) (2,120)
Proceeds from exercise of stock options 655 878
--------- ---------
Cash used for financing activities 5,241 (3,583)
--------- ---------
Net decrease in cash (7,357) (1,263)
Cash at beginning of period 8,230 13,305
--------- ---------
Cash at end of period $ 873 $ 12,042
========= =========
Cash payments for:
Interest, net of amount capitalized $ 1,865 $ 2,123
Income taxes 1,918 855
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
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BANTA CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1) Basis of Presentation
The condensed financial statements included herein have been prepared by
the Corporation, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared
in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although
the Corporation believes that the disclosures are adequate to make the
information presented not misleading. It is suggested that these
condensed financial statements be read in conjunction with the financial
statements and the notes thereto included in the Corporation's latest
annual report on Form 10-K.
In the opinion of Management, the aforementioned statements reflect all
adjustments (consisting only of normal recurring adjustments) necessary
for a fair presentation of the results for the interim periods.
(2) Acquisition of Danbury Printing & Litho, Inc.
In March of 1994, the Corporation purchased substantially all of the
assets of Danbury Printing & Litho, Inc. ("Danbury") for approximately
$16.3 million in cash and assumed selected liabilities. Danbury, which
reported sales of approximately $35 million in 1993, is included in the
Corporation's Direct Marketing Group, which is included in the commercial
market. This acquisition was accounted for as a purchase and,
accordingly, the accompanying financial statements of the Corporation
include the results of the Danbury beginning with the acquisition date.
3) Inventories
The majority of the Corporation's inventories are accounted for at cost
determined on a last-in, first-out (LIFO) basis, which is not in excess
of market. The remaining inventories are stated at the lower of cost or
market using the first-in, first-out (FIFO) method. Inventories include
material, labor and manufacturing overhead.
Inventory amounts at April 2, 1994 and January 1, 1994 are as follows:
<TABLE>
<CAPTION>
Dollars in Thousands
APRIL 2, 1994 JANUARY 1, 1994
<S> <C> <C>
Raw Materials and Supplies $23,446 $25,502
Work-In-Process and Finished Goods 26,548 30,941
------- -------
FIFO value (current cost of all inventories) 49,994 56,443
Excess of current cost over carrying value
of LIFO inventories (3,996) (3,996)
------- -------
Net Inventories $45,998 $52,447
======= =======
</TABLE>
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Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain significant
factors which have influenced the Corporation's financial position and results
of operations from the close of the latest fiscal year-end in comparison to
the corresponding interim period in the preceding year included in the
Unaudited Consolidated Condensed Balance Sheets, Statements of Earnings and
Statements of Cash Flows.
FINANCIAL CONDITION
Liquidity and Capital Resources
The Corporation's net working capital was decreased by approximately
$21.4 million during the first quarter of 1994. This reduction was
primarily due to a reduction in cash balances and the issuance of short-
term notes payable to support the first quarter capital expenditures and
the acquisition of Danbury.
During the second quarter the Corporation has committed to issue $25
million of long-term debt at an interest rate of 7.62%. The proceeds of
the debt issued will be used to repay short-term indebtedness. After
the issuance of this debt, the Corporation's long-term debt to total
capitalization will be approximately 19%.
RESULTS OF OPERATIONS
Net Sales
Sales for the first quarter of 1994 were $25.4 million (16%) higher than
the first quarter of 1993. Sales increased for all market
classifications (commercial, books, magazines and other). The sales
increases in the commercial and magazine markets resulted primarily from
market share gains. Activity within the book market was mixed as volume
increased for software documentation and trade books, but sales of
educational materials were even with last year. Danbury, which was
acquired during the first quarter of 1994, accounted for approximately
$2 million of the sales gain.
Cost of Goods Sold
Cost of goods sold as a percentage of sales increased from 77.7% for the
first quarter of 1993 to 78.1% for the first quarter of 1994. This
overall margin decline was primarily due to lower margins in the book
market and in each of the product lines served by KCS Industries (point-
of-purchase displays, labels and postage stamps). The lower book market
margins were due to a larger proportion of work containing high material
content and an uneven work flow as the production facilities were
underutilized early in the quarter and very busy in March. The lower
margins at KCS Industries were due to lower value added sales volume and
higher than expected costs required to complete a large postage stamp
project.
Selling and Administrative Expenses
Selling and administrative expenses were $2.5 million higher for the
first quarter of 1994 than for the first quarter of 1993. The increase
is primarily due to higher levels of activity in general, an increase in
commissionable sales and $300,000 for the addition of Danbury.
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Interest Expense
Interest expense was $249,000 lower in the first quarter of 1994 than for
the first quarter of 1993. Although the Corporation's average level of
long-term and short-term indebtedness was approximately $7 million higher
during the first quarter of 1994 compared with the same period in 1993,
the interest associated with those borrowings was less in 1994 because
approximately $10 million of higher cost long-term debt has been replaced
with commercial paper bearing lower interest rates since the first
quarter of 1993. Also contributing to the interest rate reduction was an
increase in capitalized interest of approximately $160,000.
Income Taxes
The Corporation's effective income tax rate was 40.1% and 39.1% for the
first quarter of 1994 and 1993, respectively. The increase is a result
of the federal tax increase that was enacted in the third quarter of
1993.
PART II: OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
(a) - (c)
At the annual meeting of shareholders held on April 26, 1994, all of the
persons nominated as directors were elected. The following table sets
forth certain information with respect to such election:
Shares
NAME OF NOMINEE SHARES VOTED FOR WITHHOLDING AUTHORITY
Barry K. Allen 17,130,533 174,271
Calvin W. Aurand, Jr. 17,218,835 85,969
Jameson A. Baxter 17,268,905 35,899
George T. Brophy 17,120,944 183,860
William J. Cadogan 17,255,378 49,426
Gerald A. Henseler 17,218,826 85,978
Bernard S. Kubale 17,253,477 51,327
Curtis W. Tarr 17,133,980 170,824
Donald Taylor 17,247,652 57,152
Allan J. Williamson 17,210,439 94,365
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ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10 (a) 1988 Deferred Compensation Plan for Key Employees, as
amended and restated.
10 (b) Basic Form of Deferred Compensation Agreements under
(post December 31, 1993) 1988 Deferred Compensation
Plan for Key Employees.
(b) No reports on Form 8-K were filed during the quarter for which
this report is filed.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BANTA CORPORATION
/S/ GERALD A. HENSELER
Gerald A. Henseler
Executive Vice President and Chief Financial Officer
Date MAY 11, 1994 <PAGE>
<PAGE>
BANTA CORPORATION
EXHIBIT INDEX TO FORM 10-Q
For The Quarter Ended April 2, 1994
Exhibit Page Number in Sequential
Number Numbering System
10 (a) 1988 Deferred Compensation Plan for Key
Employees, as amended and restated. . . . . . 11
(b) Basic Form of Deferred Compensation
Agreements under (post December 31, 1993)
1988 Deferred Compensation Plan for Key
Employees. . . . . . . . . . . . . . . . . . .21
BANTA CORPORATION
1988 DEFERRED COMPENSATION PLAN FOR KEY EMPLOYEES
Article I
Definitions
Except as otherwise expressly provided, each of the following terms used
herein shall have the meaning set forth below:
1. Account. The "Account" means the account established for
bookkeeping purposes by the Company under the Plan and the Participant's
Deferred Compensation Agreement.
2. Benefit and Benefit Period. The "Benefit" shall be the payment
relating to Normal Retirement, death or Other Termination set forth and the
"Benefit Period" shall be the period relating to such Benefit set forth in the
Participant's Deferred Compensation Agreement. The Benefit Period shall not
exceed ten (10) years.
3. Company. The "Company" shall mean Banta Corporation, a Wisconsin
corporation, and all of its consolidated subsidiaries.
4. Compensation Committee. The "Compensation Committee" shall be those
directors designated by the Board of Directors from time to time to serve on
the Compensation Committee. The Compensation Committee shall be responsible
for administration of the Plan. The Compensation Committee is authorized to
interpret any provisions of the Plan, and any such interpretation shall be
conclusive and binding on all parties concerned.
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5. Deferral Amount and Deferral Period. The "Deferral Amount" shall be
the amount of compensation to be annually deferred, not to exceed ten percent
(10%) of: (i) the Participant's base salary for the year in which the
Participant begins participation in the Plan (the "Commencement Year"); or
(ii) $150,000, whichever is less, unless the Participant has less than ten
(10) years until Normal Retirement, in which event the Participant may
annually defer a greater percentage of such compensation as described in
Article II, Section 2 of the Plan. The "Deferral Period" shall be the period
during which the Participant is deferring the Deferral Amount and shall not
exceed ten (10) years. The Deferral Amount and the Deferral Period shall be
set forth in the Participant's Deferred Compensation Agreement.
6. Deferred Compensation Agreement. The "Deferred Compensation
Agreement" shall be the agreement between the Company and the Participant
pursuant to which the Participant elects to participate in the Plan. The
Deferred Compensation Agreement shall set forth (i) Deferral Amount and the
Deferral Period; (ii) the Benefit to be paid by the Company to the Participant
during the Benefit Period and the Benefit Period; and (iii) the Disability
Benefit and Disability Benefit Period applicable in the event of the
Participant's Disability.
7. Disability; Disability Benefit; Disability Benefit Period;
Disability Level Payment Amount; and Disability Level Payment Amount Period.
"Disability" shall mean the Participant's permanent and total disability as
determined by the Board of Directors of the Company prior to the Participant's
Normal Retirement or Other Termination. The "Disability Benefit" shall be the
Disability payment set forth and the "Disability Benefit Period" shall be the
period relating to such Disability Benefit set forth in the Participant's
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Deferred Compensation Agreement. The "Disability Level Payment Amount" shall
mean the amount determined by amortizing the sum of (i) the amount standing in
the Participant's Account as of the date of the Participant's Disability as
set forth by the Board of Directors of the Company in making the determination
of Disability; and (ii) the amount of the additional credits to the Account
from the date of Disability to the date the Participant becomes age 65 as
described in Article II, Section 1 (b) of the Plan, over a period of time
equal to the Participant's Benefit Period as designated in Section 2 of the
Participant's Deferred Compensation Agreement (the "Disability Level Payment
Amount Period") in accordance with a Level Payment Amortization Schedule
assuming monthly installments and an interest rate of ten percent (10%) per
annum.
8. Level Payment Amount. The "Level Payment Amount" shall mean the
amount determined by amortizing the amount standing to the Participant's
credit in the Account as of the date of the Participant's Termination of
Employment over the Participant's Benefit Period in accordance with a Level
Payment Amortization Schedule assuming monthly installments and an interest
rate of ten percent (10%) per annum.
9. Normal Retirement. "Normal Retirement" shall mean termination of
employment by Participant at a date no earlier than Participant's reaching age
65.
10. Other Termination. "Other Termination" shall be the termination of
Participant's employment with the Company other than upon Normal Retirement,
death or Disability.
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11. Participant. A "Participant" means any executive or other key
employee of the Company who is designated by the Compensation Committee as a
Participant in the Plan and elects to so participate.
12. Plan. The "Plan" means the Company's Deferred Compensation Plan for
Key Employees adopted by the Company's Board of Directors on October 25, 1988,
as amended.
13. Supplemental Retirement Plan. The "Supplemental Retirement Plan"
means the Company's Supplemental Retirement Plan for Key Employees which
became effective as of January 1, 1980, as amended.
14. Termination Date. The "Termination Date" shall mean with respect to
each Participant the earliest to occur of the following events:
a) Death;
b) Normal Retirement;
c) Disability; or
d) Other Termination
Article II
Operation
1. Credits to the Account. The Company shall make credits to the
Account as follows:
(a) Annual Credits. The Company shall credit the Participant's
Account with the Deferral Amount set forth in the Participant's Deferred
Compensation Agreement per calendar year until the end of the Participant's
Deferral Period as set forth in such Agreement or until the Participant's
Termination Date, whichever occurs first, commencing
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on the date set forth in such Agreement. Such amount shall be credited to the
Account by the Company in equal installments on the Company's regular payroll
dates, except that no such credits shall be made after the Participant's
Termination Date.
(b) Additional Credits. Until payment of the Benefit or the
Disability Level Payment Amount, in the event of the Participant's Disability,
commences, additional credits will be made to the Account by the Company on
January 1 and July 1 of each year commencing on July 1, of the Commencement
Year. Each such additional credit shall be in an amount equivalent to
interest at the rate of ten percent (10%) per annum on the outstanding balance
of the Account from time to time, computed in the case of the first additional
credit, from the first day of the month immediately following the date of the
Participant's Deferred Compensation Agreement up to and including the date
immediately prior to the date the additional credit is made and, in the case
of subsequent additional credits, from the date of the last preceding
additional credit, up to and including the date prior to the date the
additional credit is made.
2. Catch-up Provision. Any Participant who is over age 55 and thus has
a Deferral Period of less than ten (10) years, may elect to defer more than
ten percent (10%) annually so that such Participant's aggregate Deferral
Amounts upon Normal Retirement equal the lesser of his base salary for the
Commencement Year or $150,000 (the "Targeted Deferral"). The Deferral Amount
under this "catch-up" provision shall be set forth in the Participant's
Deferred Compensation Agreement and shall be either (i) an amount equal to the
Targeted Deferral divided by the number of years in the Deferral Period (the
"Amortized Catch-up"); or (ii) an amount equal to the Targeted Deferral
divided by ten (10) for each
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year of the Deferral Period except the initial year, for which the Deferral
Amount shall be an amount equal to the Targeted Deferral less the sum of the
Deferral Amounts to be made in the remainder of the Deferral Period (the "Lump
Sum Catch-up").
The following example, which assumes a Targeted Deferral of
$100,000, is intended to clarify the operation of this Section 2:
<TABLE>
<CAPTION>
Participant Deferral Amount Participant Deferral Amount
Age Year (Amortized Catch-up) (Lump Sum Catch-up)
<C> <C> <C> <C>
60 1 $20,000.00 $60,000.00
61 2 $20,000.00 $10,000.00
62 3 $20,000.00 $10,000.00
63 4 $20,000.00 $10,000.00
64 5 $20,000.00 $10,000.00
</TABLE>
3. Payment of Benefit, Disability Benefit and Disability Level Payment
Amount. The payment of the Benefit or Disability Benefit, as the case may be,
shall commence as of the first day of the next calendar quarter following the
Participant's Normal Retirement, death, retirement after attaining age 62, or
Disability whichever occurs first. In the event of Participant's Other
Termination, except for retirement after attaining age 62 but prior to Normal
Retirement, payment of the Benefit shall commence as of the first day of the
next calendar quarter following the date on which Participant becomes age 65.
The Company shall pay the Participant, in substantially equal monthly
installments, the Benefit, Disability Benefit or Disability Level Payment
Amount per year for the Benefit Period, Disability Benefit Period, or
Disability Level Payment Amount Period, as the case may be, as specified
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or described in the Participant's Deferred Compensation Agreement. Provided,
however, that notwithstanding the foregoing, in the case of a person who
becomes a Participant after December 31, 1993, in the event of such
Participant's Other Termination (except for retirement after attaining age 62
but prior to Normal Retirement) the entire Benefit shall be paid to such
Participant (or such Participant's designated beneficiary or estate) in a lump
sum within 30 days after such Other Termination, and shall include a credit
computed as provided in Article II, Section 1 (b) from the date of the last
preceding additional credit referred to therein up to and including the date
of such Other Termination. In the event of the Participant's death after
Normal Retirement or Other Termination and before or during the Benefit
Period, all subsequent payments shall be paid to the Participant's designated
beneficiary or estate as hereinafter provided for the remainder of the Benefit
Period. In the event of the Participant's death after Disability and before
or during the Disability Benefit Period, the Disability Benefit shall cease
and the Company shall pay the Participant's designated beneficiary or estate
as hereinafter provided, in substantially equal monthly installments, the
Benefit per year for the Benefit Period, commencing on the first day of the
next calendar quarter following such death.
In the event of the Participant's death after the payment of the Disability
Level Payment Amounts has commenced, all subsequent payments shall be paid to
the Participant's designated beneficiary or estate as hereinafter provided for
the remainder of the Disability Level Payment Amount Period.
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Notwithstanding the foregoing or anything in this Plan to the contrary, in the
event of a change in control of the Company as such term is defined in the
Banta Corporation Executive Trust Agreement, a Participant (or his estate or
designated beneficiary) shall be entitled to receive a lump sum payment in
lieu of any other payment called for by this Plan or the Participant's
Deferred Compensation Agreement, determined as follows:
(a) In the event that the Participant (or his estate or designated
beneficiary) has become eligible to receive payments under his Deferred
Compensation Agreement prior to the date of such change in control by reason
of death, Disability, Normal Retirement or Other Termination, the lump sum
payment shall be equal to the present value of the future payments the
Participant (or his estate or designated beneficiary) would otherwise be
eligible to receive under his Deferred Compensation Agreement, determined by
using the interest rate described in the Plan, compounded monthly. In the
case of a Participant who has become eligible to receive or who is receiving
the Disability Benefit, the lump sum payment shall be determined by assuming
that such Participant would otherwise have received the Disability Benefit for
the remainder of the Disability Benefit Period and the Disability Level
Payment Amount for the entire Disability Level Payment Amount Period.
(b) In the event the Participant has not become eligible to receive any
payments under his Deferred Compensation Agreement prior to the date of such
change in control, the amount of the lump sum payment shall be the amount
standing to the Participant's Account as of the date of the change in control.
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Article III
General Provisions
1. Supplemental Retirement Plan. The amount of compensation deferred
by the Participant pursuant to the Plan and the Participant's Deferred
Compensation Agreement shall be added to the amount of compensation covered by
the Company's Supplemental Retirement Plan to prevent any reduction in the
Participant's benefits under the Company's pension plan as a result of such
deferrals of compensation.
2. Beneficiary. The Participant may by written notice addressed to the
Secretary of the Company designate a beneficiary to receive the payments to
which he is entitled under his Deferred Compensation Agreement in the event of
his death prior to receipt of all such payments. If the Participant fails to
make such a designation, or in the event the designated beneficiary
predeceases the Participant and no successor has been designated, payments
becoming due pursuant to such Deferred Compensation Agreement after the
Participant's death shall be made to his estate.
3. Other Benefits. Nothing in this Plan or in the Participant's
Deferred Compensation Agreement shall affect the rights of the Participant or
the Company under any stock option plan, pension plan, insurance plan or other
benefit plan of the Company in which the Participant participates or under any
other contract between the Participant and the Company.
4. Status of Account. The Account and amounts credited thereto by the
Company pursuant to the Plan and the Participant's Deferred Compensation
Agreement shall not constitute or be treated as a trust fund of any kind. On
the contrary, the Company shall
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not be required to set aside any amounts credited to the Account and all
amounts at any time credited to the Account shall be and remain the sole
property of the Company. The Participant shall have no ownership rights of
any nature with respect to amounts credited to the Account until such time as
amounts are paid over and transferred to the Participant as provided herein
and in the Participant's Deferred Compensation Agreement. Neither the
Participant or one acting for him after his death shall have power to
transfer, assign, anticipate, mortgage, or otherwise encumber in advance any
of the payments provided for in the Plan and the Participant's Deferred
Compensation Agreement, nor shall any of said payments nor any assets or funds
of the Company be subject to seizure for the payment of any debts, judgements,
alimony or separate maintenance, or be reached or transferred by operation of
law in the event of bankruptcy, insolvency, or otherwise.
5. Withholding of Taxes. There shall be deducted from each payment
under the Participant's Deferred Compensation Agreement, the amount of any tax
required by any governmental authority to be withheld and paid over by the
Company to such governmental authority for the account of the Participant or
other person entitled to such distribution.
6. Termination; Amendment. The Company's Board of Directors may at any
time terminate or amend the Plan as it, in its sole discretion, shall deem
advisable. No termination or amendment of the Plan may, without the consent
of the Participant, adversely affect the rights of the Participant.
DEFERRED COMPENSATION AGREEMENT
THIS AGREEMENT, made and entered into as of this day of
, , by and between Banta Corporation, [a Wisconsin corporation (the
"Company"), , a wholly-owned subsidiary of the
Company (the "Subsidiary")] and (the
"Participant");
WITNESSETH:
WHEREAS, the Company has established the Banta Corporation, Deferred
Compensation Plan (the "Plan") the terms of which, to the extent not stated
herein, are specifically incorporated by reference in this Agreement; and
WHEREAS, the purpose of the Plan is to provide the Participant with (i) a
retirement benefit; (ii) a disability benefit; and (iii) a death benefit if
the Participant dies prior to Normal Retirement, Disability or Other
Termination; and
WHEREAS, the Participant has been selected to participate in the Plan and
has elected to so participate;
NOW, THEREFORE, in consideration of the premises and of the covenants and
agreements made herein, the parties hereby mutually covenant and agree as
follows:
1. Annual Deferral Amount and Deferral Period. The [Subsidiary]
[Company] and the Participant agree to defer Dollars
($ ) of Participant's salary per calendar year for a period of
years or until the Participant's Termination Date, whichever occurs
first, commencing , . [The Subsidiary] [Company] and
Participant agree to defer Dollars ($ )
of Participant's salary and Dollars ($
) of Participant's salary
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per calendar year for a period of years or until Participant's
Termination Date, whichever occurs first, commencing , .]
2. Benefit and Benefit Period. Commencing as of the first day of the
next calendar quarter following the Participant's Normal Retirement, death or
retirement after attaining age 62 whichever occurs first, and continuing for a
period of years (the "Benefit Period") the following "Benefit"
shall be paid by the Company to the Participant:
(a) Payment Upon Normal Retirement. In the event of Participant's
Normal Retirement, the Company shall pay the Participant, in substantially
equal monthly installments, Dollars ($ )
per year during the Benefit Period for a total Benefit of
Dollars ($ ).
(b) Payment Upon Death. In the event of Participant's death prior to
his Normal Retirement, Disability or Other Termination, or after Disability
and before or during the Disability Benefit Period, the Company shall pay to
the Participant's designated beneficiary or estate, in substantially equal
monthly installments, during the Benefit Period, the greater of: (i) the Level
Payment Amount, or (ii) Dollars ($ ) per
year for a total Benefit of Dollars ($ ).
(c) Payment Upon Retirement After Attaining Age 62. In the event of
Participant's retirement after attaining age 62 but prior to Normal
Retirement, the Company shall pay the Participant, in substantially equal
monthly installments, the Level Payment Amount per year during the Benefit
Period.
In the event of Participant's Other Termination (except for retirement
after attaining age 62 prior to Normal Retirement) the Company shall pay the
Participant within 30 days
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after such Other Termination, a Benefit consisting of a lump sum equal to the
amount standing to the Participant's credit in the Account as of the date of
such Other Termination.
3. Disability Benefit; Disability Benefit Period, Disability Level
Payment Amount; and Disability Level Payment Amount Period. Commencing as of
the first day of the next calendar quarter following the Participant's
Disability and continuing until the Participant becomes age 65 (the
"Disability Benefit Period"), the Company shall pay the Participant, in
substantially equal monthly installments, Dollars ($
) per year during the Disability Benefit Period (the "Disability
Benefit"). Commencing with the first monthly payment after the Participant
becomes age 65 and continuing for the Disability Level Payment Amount Period,
the Company shall pay the Participant, in substantially equal monthly
installments, the Disability Level Payment Amount per year during such
Disability Level Payment Amount Period.
4. Change in Control. Notwithstanding anything to the contrary in this
Agreement, in the event of a change in control of the Company as defined in
the Banta Corporation Executive Trust Agreement ("Change in Control"), the
Participant (or his estate or designated beneficiary) shall be entitled to
receive a lump sum payment in lieu of any other payment called for by this
Agreement, determined as follows:
(a) In the event that the Participant (or his estate or designated
beneficiary) has become eligible to receive payments under this Agreement
prior to the date of the Change in Control by reason of death, Disability,
Normal Retirement or Other Termination, the lump sum payment shall be equal to
the present value of the future payments the Participant (or his estate or
designated beneficiary) would otherwise be eligible to receive under
this
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Agreement, determined by using the interest rate described in the Plan,
compounded monthly. In the case of a Participant who has become eligible to
receive or who is receiving the Disability Benefit, the lump sum payment shall
be determined by assuming that such Participant would otherwise have received
the Disability Benefit for the remainder of the Disability Benefit Period and
the Disability Level Payment Amount for the entire Disability Level Payment
Amount Period.
(b) In the event the Participant has not become eligible to receive any
payments under this Agreement prior to the date of the Change in Control, the
amount of the lump sum payment shall be the present amount standing to the
Participant's credit in the Account as of the date of the Change in Control.
5. Miscellaneous. This Agreement may not be released, discharged,
abandoned, changed or amended in any manner except by a written instrument
signed by the parties hereto. This Agreement shall be governed by and
construed and interpreted in accordance with the laws of the State of
Wisconsin. Capitalized terms used in this Agreement shall have the meaning
set forth in the Plan.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officers and its corporate seal to be hereunto affixed,
and the Participant has affixed his hand and seal as of the day and year first
above written.
Banta Corporation
By
President
(Corporate Seal) ATTEST:
Secretary
[
("Subsidiary")
(Corporate Seal) By
(title)
Attest:
]
(SEAL)
Participant
