SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended October 3, 1998
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______
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: (920) 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 October 3, 1998, 28,942,854 shares
of $.10 par value common stock.
1
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BANTA CORPORATION AND SUBSIDIARIES
Quarterly Report on Form 10-Q
For the Quarter Ended October 3, 1998
INDEX
PART I -- FINANCIAL INFORMATION Page Number
Item 1 -- Financial Statements:
Unaudited Consolidated Condensed Balance Sheets at
October 3, 1998 and January 3, 1998.................................3
Unaudited Consolidated Condensed Statements of Earnings for
the Three Months and Nine Months Ended October 3, 1998
and September 27, 1997.........................................4
Unaudited Consolidated Condensed Statements of Cash Flows
for the Nine Months Ended October 3, 1998 and
September 27, 1997............................................5
Notes to Unaudited Consolidated Condensed
Financial Statements.........................................6-7
Item 2 -- Management's Discussion and Analysis of
Financial Condition and Results of Operations...............8-10
Item 3 -- Qualitative and Quantitative Disclosures
about Market Risk.........................................10
PART II -- OTHER INFORMATION
Item 6 -- Exhibits and Reports on Form 8-K............................ 11
Exhibit Index................................................................ 12
2
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PART I Item 1. Financial Statements
BANTA CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in thousands)
October 3, 1998 January 3, 1998
ASSETS
Current Assets
Cash and cash equivalents $ 20,283 $ 16,432
Receivables 243,158 228,483
Inventories 85,205 95,341
Other current assets 28,221 25,420
--------- ---------
Total Current Assets 376,867 365,676
--------- ---------
Plant and Equipment 748,080 718,669
Less: Accumulated Depreciation (423,290) (380,312)
--------- ---------
Plant and Equipment, net 324,790 338,357
--------- ---------
Other Assets 17,688 14,524
Cost in Excess of Net Assets
of Subsidiaries Acquired 66,498 62,659
--------- ---------
$ 785,843 $ 781,216
========= =========
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities
Short-term debt $ 44,545 $ 33,880
Accounts payable 101,042 106,235
Accrued salaries and wages 26,180 22,575
Other accrued liabilities 27,787 32,492
Current maturities of long-term debt 4,163 5,186
--------- ---------
Total Current Liabilities 203,717 200,368
--------- ---------
Long-term Debt 123,792 130,065
Deferred Income Taxes 20,753 19,831
Other Non-Current Liabilities 17,942 16,849
Shareholders' Investment
Preferred stock-$10 par value;
authorized 300,000 shares; none issued 0 0
Common stock-$.10 par value;
authorized 75,000,000 shares;
28,942,854 and 29,793,279 shares issued
and outstanding, respectively 2,894 2,979
Amount in excess of par value of stock 9,768 35,542
Accumulated other comprehensive income (loss) (1,485) (3,498)
Retained earnings 408,462 379,080
--------- ---------
Total Shareholders' Investment 419,639 414,103
--------- ---------
$ 785,843 $ 781,216
========= =========
See accompanying notes to consolidated financial statements
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<TABLE>
BANTA CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED STATEMENT OF EARNINGS
<CAPTION>
(Dollars in thousands, except per share amounts)
Three Months Ended Nine Months Ended
October 3, 1998 September 27, 1997 October 3, 1998 September 27, 1997
<S> <C> <C> <C> <C>
Net sales $ 343,681 $ 298,322 $ 990,491 $ 849,902
Cost of goods sold 272,942 238,615 788,813 679,827
--------- --------- --------- ---------
Gross earnings 70,739 59,707 201,678 170,075
Selling and administrative expenses 42,451 34,976 126,992 104,471
Restructuring charge -- 13,500 -- 13,500
--------- --------- --------- ---------
Earnings from operations 28,288 11,231 74,686 52,104
Interest expense (2,278) (2,456) (7,965) (7,673)
Other, net 420 327 (365) 1,773
--------- --------- --------- ---------
Earnings before income taxes 26,430 9,102 66,356 46,204
Provision for income taxes 10,200 3,500 25,700 18,000
--------- --------- --------- ---------
Net earnings $ 16,230 $ 5,602 40,656 $ 28,204
========= ========= ========= =========
Basic earnings per share of common stock $ .55 $ .19 $ 1.37 $ .94
========= ========= ========= =========
Diluted earnings per share of common stock $ .55 .19 1.37 .94
========= ========= ========= =========
Cash dividends per common share $ .13 $ .12 $ .39 $ .35
========= ========= ========= =========
See accompanying notes to consolidated financial statements.
</TABLE>
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BANTA CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
Nine Months Ended
October 3, September 27,
1998 1997
Cash Flows From Operating Activities
Net earnings $40,656 $28,204
Depreciation and amortization 51,797 44,160
Deferred income taxes 922 (1,000)
Restructuring charge -- 13,500
Gain on sale of building (870) --
Change in assets and liabilities,
net of acquisitions:
Increase in receivables (13,863) (18,195)
Decrease (increase) in inventories 10,136 (6,546)
Increase in other current assets (2,454) (2,613)
(Decrease) increase in accounts payable
and accrued liabilities (6,075) 10,068
Increase in other non-current assets (3,128) (1,989)
Other, net 2,012 75
------- -------
Cash provided from operating activities 79,133 65,664
------- -------
Cash Flows From Investing Activities
Acquisition of businesses, net of cash
acquired (2,354) (50,666)
Proceeds from sale of building, net 4,625 --
Capital expenditures, net (43,790) (38,774)
------- -------
Cash used for investing activities (41,519) (89,440)
------- -------
Cash Flows From Financing Activities
Proceeds from notes payable, net 10,665 24,458
Repayment of long-term debt (7,296) (5,232)
Dividends paid (11,273) (10,554)
Proceeds from exercise of stock options 3,326 3,050
Repurchase of common stock (29,185) (32,570)
------- -------
Cash used for financing activities (33,763) (20,848)
------- -------
Net increase (decrease) in cash 3,851 (44,624)
Cash at beginning of period 16,432 57,417
------- -------
Cash at end of period $20,283 $12,793
======= =======
Cash payments for:
Interest, net of amount capitalized $ 8,107 $ 7,269
Income taxes 26,166 22,384
See accompanying notes to consolidated statements.
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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. Results for the
period ended October 3, 1998 are not necessarily indicative of results that
may be expected for the year ending January 2, 1999.
2) Inventories
The majority of the Corporation's inventories used in its printing
operations 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 October 3, 1998 and January 3, 1998 were as follows:
(Dollars in thousands)
October 3, 1998 January 3, 1998
-------- --------
Raw Materials and Supplies $ 45,354 $ 55,026
Work-In-Process and Finished Goods 44,442 44,908
-------- --------
FIFO value (current cost of all inventories) 89,796 99,934
Excess of current cost over carrying value
of LIFO inventories (4,591) (4,593)
-------- --------
Net Inventories $ 85,205 $ 95,341
======== ========
3) Earnings Per Share of Common Stock
Basic earnings per share of common stock is computed by dividing net
earnings by the weighted average number of common shares outstanding during
the period. Diluted earnings per share of common stock is computed by
dividing net earnings by the weighted average number of common shares and
common equivalent shares, which relate entirely to the assumed exercise of
stock options. The weighted average shares used in the computation of
earnings per share were as follows (in millions of shares):
6
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Three months ended Nine months ended
October 3, September 27, October 3, September 27,
1998 1997 1998 1997
Basic 29.3 29.8 29.6 30.0
Diluted 29.4 30.0 29.7 30.2
4) Acquisition
In September of 1998, the Corporation acquired all the outstanding capital
stock of Type Designs, Inc. ("Type Designs") for approximately $2.4 million
in cash. Type Designs provides a full range of design and graphic
production services with annual sales of approximately $4 million. This
acquisition was accounted for as a purchase and, accordingly, the financial
statements of the Corporation include the results of Type Designs beginning
with the acquisition date.
5) Restructuring Charge
In the third quarter of 1997, the Corporation recorded a restructuring
charge of $13.5 million ($8.1 million after tax or $.27 per common share)
related to the sale of its point-of-purchase sign and display business, the
discontinuation of its intaglio print-based security products business and
the interactive video operation, and the closing of three Global Turnkey
facilities. At January 3, 1998, the remaining reserve totaled $3.7 million,
which related to anticipated expenditures associated with the closure of
facilities described above and related matters. For the first three
quarters of 1998, costs of approximately $3.0 million, related primarily to
lease termination costs, were charged against the reserve. With the
exception of continued lease termination costs, the restructuring
initiatives have been essentially completed.
In the third quarter of 1998, the Corporation sold the facility for its
point-of-purchase sign and display business. Net proceeds were
approximately $4.6 million with a gain of $870,000 recognized in the third
quarter. This gain is included in "Other, net" on the statement of
earnings.
6) Comprehensive Income
Total comprehensive income, comprised of net income and other comprehensive
income (loss), was $18,883,000 and $4,615,000 for the third quarter of 1998
and 1997, respectively. For the first three quarters of 1998 and 1997,
comprehensive income was $42,669,000 and $24,250,000, respectively. Other
comprehensive income (loss) was comprised solely of foreign currency
translation adjustments. The Corporation does not record U.S. income taxes
on foreign currency translation adjustments because it does not provide for
taxes on undistributed earnings of foreign subsidiaries.
7) Accounting for Derivative Instruments and Hedging Activities
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This standard requires that an entity
recognize derivatives as either assets or liabilities on its balance sheet
and measure those instruments at fair value. The Corporation intends to
adopt this standard in 2000. The adoption of this standard is not expected
to have a material effect on the Corporation's financial statements.
7
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
Liquidity and Capital Resources
The Corporation's net working capital increased by approximately $8 million
during the first three quarters of 1998. The increase in receivables and
reduction in inventory compared to the 1997 year-end balances was the
result of seasonality in the Corporation's business. Compared to the prior
year third quarter, receivables and inventory were relatively level. An
increase in short-term debt, due to stock repurchases and an acquisition,
partially offset the increase in current assets. During the first three
quarters of 1998, the Corporation repurchased approximately one million
shares of common stock at an aggregate purchase price of $29 million
pursuant to its common stock repurchase program. During the third quarter
of 1998, the Corporation acquired the outstanding stock of Type Designs for
approximately $2.4 million. See Note 4 to the Notes to Unaudited
Consolidated Condensed Financial Statements for a description of the
acquisition. The stock repurchases and acquisition were funded by a
combination of cash provided from operations and short-term borrowings.
In late October 1998, the Board of Directors authorized the repurchase of
an additional $50 million of common stock. This repurchase authority is in
addition to the $60 million program previously authorized by the Board. Of
the $60 million previously authorized, approximately $34 million of
repurchase authority remains. Any future stock repurchases are expected to
be funded by a combination of cash provided from operations and short-term
borrowings.
Capital expenditures were $43.8 million during the first three quarters of
1998, an increase of $5 million from the amount expended during the first
three quarters of 1997. Capital requirements for the full year are expected
to be between $70 million and $75 million and are expected to be funded by
a combination of cash provided from operations and short-term borrowings.
The increase in capital spending reflects the Corporation's commitment to
expand and modernize its facilities. Long-term debt as a percentage of
total capitalization was down over 1% from 23.9% to 22.8% due to the
current year repayments.
RESULTS OF OPERATIONS
Net Sales
Sales for the third quarter of 1998 were $45.4 million or 15% higher than
in the third quarter of 1997. The increase was primarily due to the turnkey
outsourcing activity and sales from companies acquired during the second
half of 1997. The remaining increase is attributed to internal growth among
several of the print and non-print operating groups. Operating activity
levels during the third quarter of 1998, in all of the Corporation's major
operating groups, were above 1997 operating levels.
8
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Sales for the first three quarters of 1998 were approximately $141 million
or 17% higher than for the first three quarters of 1997. Slightly over half
of the increase was a result of sales from companies acquired during the
second half of 1997. The remaining increase was primarily due to a strong
demand for educational products supplied by the Corporation's book group
and increased page counts in the magazine market during the first half of
1998. In addition, software releases in Europe lead to increased sales in
turnkey services.
Cost of Goods Sold
Cost of goods sold as a percentage of sales decreased from 80.0% for the
third quarter of 1997 to 79.4% for the third quarter of 1998. The most
significant factors contributing to the margin improvement were improved
utilization at the turnkey facilities and stable paper prices. During the
third quarter of 1997, rising paper prices resulted in an additional LIFO
provision; whereas in 1998, no LIFO provision was required. Slightly
offsetting the margin improvements were inefficiencies and underutilization
at certain of the direct marketing facilities. Management is currently
reviewing alternatives for corrective action at these facilities.
Cost of goods sold as a percentage of sales decreased from 80.0% for the
first three quarters of 1997 to 79.6% for the first three quarters of 1998.
This improvement resulted from the same factors that impacted the third
quarter.
Selling and Administrative Expenses
Selling and administrative expenses were $7.5 million higher for the third
quarter of 1998 than for the third quarter of 1997 and $24.5 million higher
for the first three quarters of 1998 as compared with the first three
quarters of 1997. The increase is primarily due to the inclusion of selling
and administrative expenses for the companies acquired in 1997 along with
higher levels of operating activity at previously-owned facilities.
Interest Expense
Interest expense was $178,000 lower in the third quarter of 1998 than in
the third quarter of 1997 due to interest capitalized on construction in
progress during the current year third quarter. For the first three
quarters of 1998, interest expense was $292,000 higher than for the first
three quarters of 1997 due to increased debt levels to support the 1997
acquisitions and 1998 stock repurchases.
Income Taxes
The Corporation's effective income tax rate for the first three quarters of
1998 declined slightly as indicated in the table below due to an increase
in foreign earnings which are taxed at lower rates.
Effective Tax Rate
1998 1997
Third Quarter 38.6% 38.5%
First Three Quarters 38.7% 39.0%
9
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Other Matters
During 1998, the Corporation completed a preliminary evaluation of its
computer software to determine its ability to handle dates beginning with
the year 2000. It was determined that a significant portion of the
Corporation's software was year-2000 ready. This evaluation also resulted
in the development of detailed plans to replace certain software and to
reprogram other software. Banta has also implemented a program to confirm
that all business and manufacturing system hardware, control systems and
software supplied by third party vendors is year-2000 ready. Although
complete assurance can not be given, management currently believes it is
devoting the necessary resources to resolve all significant year-2000
issues, both Information Technology ("IT") and non-IT related, by June
1999. The Corporation is currently conducting audits and operational
readiness testing as well as pursuing certification of year-2000 readiness
from significant third party vendors.
The Corporation's contingency plan related to third party vendors is to
identify additional suppliers and alternate sources for essential
materials, primarily paper, in case one or more of its suppliers would not
be year-2000 ready. The majority of the Corporation's internal IT-related
systems have either been replaced or are in the process of being replaced
with year-2000 ready systems. Accordingly, a contingency plan has not
developed and is not currently considered necessary. The Corporation is
currently testing non-IT related systems (HVAC, safety and security) and
has not determined whether a contingency plan is needed. The risk of not
being year-2000 compliant on a timely basis is that product shipments could
potentially be delayed which could have an adverse impact on, among other
things, the Corporation's revenues and earnings. Additional resources,
which can not be accurately estimated at this time, would be required to
process and fulfill customer orders.
There have been no significant changes in the total costs expected to be
incurred to become year-2000 ready. Currently, the Corporation expects the
costs to approximate $3.5 million in 1998 and $2.5 million in 1999. The
majority of the costs will be capitalized.
Cautionary Statements for Forward-Looking Information
This document includes forward-looking statements. Statements that contain
estimates or projections or that describe future expectations, plans,
results or strategies are considered forward-looking. Such statements are
subject to certain risks and uncertainties which could cause actual results
to differ materially from those currently anticipated. Factors that could
affect actual results include, among others, changes in customers' demand
for the Corporation's products, changes in raw material costs and
availability, continued success in the implementation of the Corporation's
single-source marketing strategy, seasonal or unanticipated changes in
customer orders, pricing actions by competitors, success in the integration
of businesses acquired, unanticipated events relating to achieving
year-2000 compliance and general changes in economic conditions. These
factors should be considered in evaluating the forward-looking statements,
and undue reliance should not be placed on such statements. The
forward-looking statements included herein are made as of the date hereof,
and the Corporation undertakes no obligation to update publicly such
statements to reflect subsequent events or circumstances.
Item 3. Qualitative and Quantitative Disclosures about Market Risk
Not applicable
10
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PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits-
3.1 - Amendment to By-laws
3.2 - By-laws as amended
27 - Financial Data Schedule (EDGAR version only
(b) No reports on Form 8-K were filed during the
quarter for which this report is filed.
<PAGE>
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, Chief Financial Officer and Treasurer
Date November 12, 1998
11
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BANTA CORPORATION
EXHIBIT INDEX TO FORM 10-Q
For The Quarter Ended October 3, 1998
Exhibit Number
3.1 Amendments to By-laws
3.2 By-laws as amended
27 Financial Data Schedule (EDGAR version only)
12
Exhibit 3.1
BY-LAW AMENDMENTS
RESOLVED, that effective November 1, 1998, Article III, Section 3.01 of the
By-Laws of the Corporation is hereby amended to increase the number of
authorized directors to eleven (11).
FURTHER RESOLVED, that effective immediately, Section 3.02 of Article III
of the Company's By-laws be and it hereby is amended in its entirety to provide
as follows:
3.02. Tenure and Qualifications. Each director shall hold office until the
next annual meeting of shareholders and until his successor shall have been
elected and qualified, or until there is a decrease in the number of directors
which takes effect after the expiration of his term, or until his prior death,
resignation or removal. A director may be removed by the shareholders only at a
meeting called for the purpose of removing the director, and the meeting notice
shall state that the purpose, or one of the purposes, of the meeting is removal
of the director. A director may be removed from office but only for cause (as
defined herein) if the number of votes cast to remove the director exceeds the
number of votes cast not to remove him; provided, however, that, if the Board of
Directors, by resolution, shall have recommended removal of a director, then the
shareholders may remove such director without cause by the vote referred to
above. As used herein, "cause" shall exist only if the director whose removal is
proposed has been convicted of a felony by a court of competent jurisdiction,
where such conviction is no longer subject to direct appeal, or has been
adjudged liable for actions or omissions in the performance of his duty to the
corporation in a matter which has had a materially adverse effect on the
business of the corporation, where such adjudication is no longer subject to
appeal. A director may resign at any time by delivering written notice which
complies with the Wisconsin Business Corporation Law to the Chairman of the
Board or to the corporation. A director's resignation is effective when the
notice is delivered unless the notice specifies a later effective date.
Directors need not be residents of the State of Wisconsin but must be
shareholders of the corporation. Except as otherwise provided by the Board of
Directors, a director shall retire no later than the end of the term in which
occurs the earlier of the director's attainment of age seventy (70) or the
completion of fifteen (15) years of service as a non-employee director;
provided, however, that the fifteen (15) year limitation shall be inapplicable
to any director who had completed at least fifteen (15) years as a non-employee
director as of January 1, 1995. As used herein, a "non-employee director" shall
mean a director who is not an employee of the corporation or any of its
subsidiaries.
Exhibit 3.2
11/01/98
BY-LAWS
OF
BANTA CORPORATION
(a Wisconsin corporation)
ARTICLE I. OFFICES
1.01. Principal and Business Offices. The corporation may have such
principal and other business offices, either within or without the State of
Wisconsin, as the Board of Directors may designate or as the business of the
corporation may require from time to time.
1.02. Registered Office. The registered office of the corporation required
by the Wisconsin Business Corporation Law to be maintained in the State of
Wisconsin may be, but need not be, identical with the principal office in the
State of Wisconsin, and the address of the registered office may be changed from
time to time by the Board of Directors. The business office of the registered
agent of the corporation shall be identical to such registered office.
ARTICLE II. SHAREHOLDERS
2.01. Annual Meeting. The annual meeting of the shareholders of the
corporation (the "Annual Meeting") shall be held on the second Tuesday in the
month of April of each year, at the hour of two (2) o'clock p.m. (local time),
or at such other time and date as may be fixed by or under the authority of the
Board of Directors, for the purpose of electing directors and for the
transaction of such other business as may properly come before the Annual
Meeting in accordance with Section 2.13 of these by-laws. If the day fixed for
the Annual Meeting shall be a legal holiday in the State of Wisconsin, such
meeting shall be held on the next succeeding business day. If the election of
directors shall not be held on the day designated herein, or fixed as herein
provided, for any Annual Meeting, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special meeting of the
shareholders (a "Special Meeting") as soon thereafter as conveniently may be. In
fixing a meeting date for any Annual Meeting, the Board of Directors may
consider such factors as it deems relevant within the good faith exercise of its
business judgment.
2.02. Special Meetings.
(a) A Special Meeting may be called only by (i) the Chairman of the Board,
(ii) the President or (iii) the Board of Directors and shall be called by the
Chairman of the Board or the President upon the demand, in accordance with this
Section 2.02, of the holders of record of shares representing at least 10% of
all the votes entitled to be cast on any issue proposed to be considered at the
Special Meeting.
(b) In order that the corporation may determine the shareholders entitled
to demand a Special Meeting, the Board of Directors may fix a record date to
determine the shareholders entitled to make such a demand (the "Demand Record
Date"). The Demand Record Date shall not precede the date upon which the
resolution fixing the Demand Record Date is adopted by the Board of Directors
and
<PAGE>
shall not be more than 10 days after the date upon which the resolution fixing
the Demand Record Date is adopted by the Board of Directors. Any shareholder of
record seeking to have shareholders demand a Special Meeting shall, by sending
written notice to the Secretary of the corporation by hand or by certified or
registered mail, return receipt requested, request the Board of Directors to fix
a Demand Record Date. The Board of Directors shall promptly, but in all events
within 10 days after the date on which a valid request to fix a Demand Record
Date is received, adopt a resolution fixing the Demand Record Date and shall
make a public announcement of such Demand Record Date. If no Demand Record Date
has been fixed by the Board of Directors within 10 days after the date on which
such request is received by the Secretary, the Demand Record Date shall be the
10th day after the first day on which a valid written request to set a Demand
Record Date is received by the Secretary. To be valid, such written request
shall set forth the purpose or purposes for which the Special Meeting is to be
held, shall be signed by one or more shareholders of record (or their duly
authorized proxies or other representatives), shall bear the date of signature
of each such shareholder (or proxy or other representative) and shall set forth
all information about each such shareholder and about the beneficial owner or
owners, if any, on whose behalf the request is made that would be required to be
set forth in a shareholder's notice described in paragraph (a)(ii) of Section
2.13 of these by-laws.
(c) In order for a shareholder or shareholders to demand a Special Meeting,
a written demand or demands for a Special Meeting by the holders of record as of
the Demand Record Date of shares representing at least 10% of all the votes
entitled to be cast on any issue proposed to be considered at the Special
Meeting must be delivered to the corporation. To be valid, each written demand
by a shareholder for a Special Meeting shall set forth the specific purpose or
purposes for which the Special Meeting is to be held (which purpose or purposes
shall be limited to the purpose or purposes set forth in the written request to
set a Demand Record Date received by the corporation pursuant to paragraph (b)
of this Section 2.02, shall be signed by one or more persons who as of the
Demand Record Date are shareholders of record (or their duly authorized proxies
or other representatives), shall bear the date of signature of each such
shareholder (or proxy or other representative), and shall set forth the name and
address, as they appear in the corporation's books, of each shareholder signing
such demand and the class or series and number of shares of the corporation
which are owned of record and beneficially by each such shareholder, shall be
sent to the Secretary by hand or by certified or registered mail, return receipt
requested, and shall be received by the Secretary within 70 days after the
Demand Record Date.
(d) The corporation shall not be required to call a Special Meeting upon
shareholder demand unless, in addition to the documents required by paragraph
(c) of this Section 2.02, the Secretary receives a written agreement signed by
each Soliciting Shareholder (as defined herein), pursuant to which each
Soliciting Shareholder, jointly and severally, agrees to pay the corporation's
costs of holding the Special Meeting, including the costs of preparing and
mailing proxy materials for the corporation's own solicitation, provided that if
each of the resolutions introduced by any Soliciting Shareholder at such meeting
is adopted, and each of the individuals nominated by or on behalf of any
Soliciting Shareholder for election as director at such meeting is elected, then
the Soliciting Shareholders shall not be required to pay such costs. For
purposes of this paragraph (d), the following terms shall have the meanings set
forth below:
(i) "Affiliate" of any Person shall mean any Person controlling,
controlled by or under common control with such first Person.
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(ii) "Participant" shall have the meaning assigned to such term in
Rule 14a-11 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act").
(iii) "Person" shall mean any individual, firm, corporation,
partnership, joint venture, association, trust, unincorporated organization
or other entity.
(iv) "Proxy" shall have the meaning assigned to such term in Rule
14a-1 promulgated under the Exchange Act.
(v) "Solicitation" shall have the meaning assigned to such term in
Rule 14a-11 promulgated under the Exchange Act.
(vi) "Soliciting Shareholder" shall mean, with respect to any Special
Meeting demanded by a shareholder or shareholders, any of the following
Persons:
(A) if the number of shareholders signing the demand or demands
for a meeting delivered to the corporation pursuant to paragraph (c)
of this Section 2.02 is 10 or fewer, each shareholder signing any such
demand;
(B) if the number of shareholders signing the demand or demands
for a meeting delivered to the corporation pursuant to paragraph (c)
of this Section 2.02 is more than 10, each Person who either (I) was a
Participant in any Solicitation of such demand or demands or (II) at
the time of the delivery to the corporation of the documents described
in paragraph (c) of this Section 2.02, had engaged or intended to
engage in any Solicitation of Proxies for use at such Special Meeting
(other than a Solicitation of Proxies on behalf of the corporation);
or
(C) any Affiliate of a Soliciting Shareholder, if a majority of
the directors then in office determine, reasonably and in good faith,
that such Affiliate should be required to sign the written notice
described in paragraph (c) of this Section 2.02 and/or the written
agreement described in this paragraph (d) in order to prevent the
purposes of this Section 2.02 from being evaded.
(e) Except as provided in the following sentence, any Special Meeting shall
be held at such hour and day as may be designated by whichever of the Chairman
of the Board, the President or the Board of Directors shall have called such
meeting. In the case of any Special Meeting called by the Chairman of the Board
or the President upon the demand of shareholders (a "Demand Special Meeting"),
such meeting shall be held at such hour and day as may be designated by the
Board of Directors; provided, however, that the date of any Demand Special
Meeting shall be not more than 70 days after the Meeting Record Date (as defined
in Section 2.05 of these by-laws); and provided further that in the event that
the directors then in office fail to designate an hour and date for a Demand
Special Meeting within 10 days after the date that valid written demands for
such meeting by the holders of record as of the Demand Record Date of shares
representing at least 10% of all the votes entitled to be cast on any issue
proposed to be considered at the Special Meeting are delivered to the
corporation (the "Delivery Date"), then such meeting shall be held at 2:00 p.m.
(local time) on the 100th day after the Delivery
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Date or, if such 100th day is not a Business Day (as defined below), on the
first preceding Business Day. In fixing a meeting date for any Special Meeting,
the Chairman of the Board, the President or the Board of Directors may consider
such factors as he or it deems relevant within the good faith exercise of his or
its business judgment, including, without limitation, the nature of the action
proposed to be taken, the facts and circumstances surrounding any demand for
such meeting, and any plan of the Board of Directors to call an Annual Meeting
or a Special Meeting for the conduct of related business.
(f) The corporation may engage nationally or regionally recognized
independent inspectors of elections to act as an agent of the corporation for
the purpose of promptly performing a ministerial review of the validity of any
purported written demand or demands for a Special Meeting received by the
Secretary. For the purpose of permitting the inspectors to perform such review,
no purported demand shall be deemed to have been delivered to the corporation
until the earlier of (i) 5 Business Days following receipt by the Secretary of
such purported demand and (ii) such date as the independent inspectors certify
to the corporation that the valid demands received by the Secretary represent at
least 10% of all the votes entitled to be cast on each issue proposed to be
considered at the Special Meeting. Nothing contained in this paragraph shall in
any way be construed to suggest or imply that the Board of Directors or any
shareholder shall not be entitled to contest the validity of any demand, whether
during or after such 5 Business Day period, or to take any other action
(including, without limitation, the commencement, prosecution or defense of any
litigation with respect thereto).
(g) For purposes of these by-laws, "Business Day" shall mean any day other
than a Saturday, a Sunday or a day on which banking institutions in the State of
Wisconsin are authorized or obligated by law or executive order to close.
2.03. Place of Meeting. The Board of Directors, the Chairman of the Board
or the President may designate any place, either within or without the State of
Wisconsin, as the place of meeting for any Annual Meeting or for any Special
Meeting, or for any postponement thereof. If no designation is made, the place
of meeting shall be the principal business office of the corporation in the
State of Wisconsin. Any meeting may be adjourned to reconvene at any place
designated by vote of the Board of Directors or by the Chairman of the Board or
the President.
2.04. Notice of Meeting. Written notice stating the place, day and hour of
any Annual Meeting or Special Meeting shall be delivered not less than 10
(unless a longer period is required by the Wisconsin Business Corporation Law)
nor more than 70 days before the date of such meeting, either personally or by
mail, by or at the direction of the Secretary, to each shareholder of record
entitled to vote at such meeting and to other shareholders as may be required by
the Wisconsin Business Corporation Law. In the event of any Demand Special
Meeting, such notice of meeting shall be sent not more than 30 days after the
Delivery Date. If mailed, notice pursuant to this Section 2.04 shall be deemed
to be effective when deposited in the United States mail, addressed to each
shareholder at his or her address as it appears on the stock record books of the
corporation, with postage thereon prepaid. Unless otherwise required by the
Wisconsin Business Corporation Law, a notice of an Annual Meeting need not
include a description of the purpose for which the meeting is called. In the
case of any Special Meeting, (a) the notice of meeting shall describe any
business that the Board of Directors shall have theretofore determined to bring
before the meeting and (b) in the case of a Demand Special Meeting, the notice
of meeting (i) shall describe any business set forth in the statement of purpose
of the demands received by the corporation in accordance with Section 2.02 of
these by-laws and (ii) shall contain all of the
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information required in the notice received by the corporation in accordance
with Section 2.13(b) of these by-laws. If an Annual Meeting or Special Meeting
is adjourned to a different date, time or place, the corporation shall not be
required to give notice of the new date, time or place if the new date, time or
place is announced at the meeting before adjournment; provided, however, that if
a new Meeting Record Date for an adjourned meeting is or must be fixed, the
corporation shall give notice of the adjourned meeting to persons who are
shareholders as of the new Meeting Record Date.
2.05. Fixing of Record Date. The Board of Directors may fix in advance a
date not less than 10 days and not more than 70 days prior to the date of any
Annual Meeting or Special Meeting as the record date for the determination of
shareholders entitled to notice of, or to vote at, such meeting (the "Meeting
Record Date"). In the case of any Demand Special Meeting, (i) the Meeting Record
Date shall be not later than the 30th day after the Delivery Date and (ii) if
the Board of Directors fails to fix the Meeting Record Date within 30 days after
the Delivery Date, then the close of business on such 30th day shall be the
Meeting Record Date. The shareholders of record on the Meeting Record Date shall
be the shareholders entitled to notice of and to vote at the meeting. Except as
provided by the Wisconsin Business Corporation Law for a court-ordered
adjournment, a determination of shareholders entitled to notice of and to vote
at any Annual Meeting or Special Meeting is effective for any adjournment of
such meeting unless the Board of Directors fixes a new Meeting Record Date,
which it shall do if the meeting is adjourned to a date more than 120 days after
the date fixed for the original meeting. The Board of Directors may also fix in
advance a date as the record date for the purpose of determining shareholders
entitled to take any other action or determining shareholders for any other
purpose. Such record date shall be not more than 70 days prior to the date on
which the particular action, requiring such determination of shareholders, is to
be taken. The record date for determining shareholders entitled to a
distribution (other than a distribution involving a purchase, redemption or
other acquisition of the corporation's shares) or a share dividend is the date
on which the Board of Directors authorizes the distribution or share dividend,
as the case may be, unless the Board of Directors fixes a different record date.
2.06. Shareholder Lists. After a Meeting Record Date has been fixed, the
corporation shall prepare a list of the names of all of the shareholders
entitled to notice of the meeting. The list shall be arranged by class or series
of shares, if any, and show the address of and number of shares held by each
shareholder. Such list shall be available for inspection by any shareholder,
beginning two business days after notice of the meeting is given for which the
list was prepared and continuing to the date of the meeting, at the
corporation's principal office or at a place identified in the meeting notice in
the city where the meeting will be held. A shareholder or his or her agent may,
on written demand, inspect and, subject to the limitations imposed by the
Wisconsin Business Corporation Law, copy the list, during regular business hours
and at his or her expense, during the period that it is available for inspection
pursuant to this Section 2.06. The corporation shall make the shareholders' list
available at the meeting and any shareholder or his or her agent or attorney may
inspect the list at any time during the meeting or any adjournment thereof.
Refusal or failure to prepare or make available the shareholders' list shall not
affect the validity of any action taken at a meeting of shareholders.
2.07. Quorum and Voting Requirements; Postponements; Adjournments.
(a) Shares entitled to vote as a separate voting group may take action on a
matter at any Annual Meeting or Special Meeting only if a quorum of those shares
exists with respect to that
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matter. If the corporation has only one class of stock outstanding, such class
shall constitute a separate voting group for purposes of this Section 2.07.
Except as otherwise provided in the Articles of Incorporation, any by-law
adopted under authority granted in the Articles of Incorporation, or the
Wisconsin Business Corporation Law, a majority of the votes entitled to be cast
on the matter shall constitute a quorum of the voting group for action on that
matter. Once a share is represented for any purpose at any Annual Meeting or
Special Meeting, other than for the purpose of objecting to holding the meeting
or transacting business at the meeting, it is considered present for purposes of
determining whether a quorum exists for the remainder of the meeting and for any
adjournment of that meeting unless a new Meeting Record Date is or must be set
for the adjourned meeting. If a quorum exists, except in the case of the
election of directors, action on a matter shall be approved if the votes cast
within the voting group favoring the action exceed the votes cast opposing the
action, unless the Articles of Incorporation, any by-law adopted under authority
granted in the Articles of Incorporation, or the Wisconsin Business Corporation
Law requires a greater number of affirmative votes. Unless otherwise provided in
the Articles of Incorporation, directors shall be elected by a plurality of the
votes cast by the shares entitled to vote in the election of directors at any
Annual Meeting or Special Meeting at which a quorum is present. For purposes of
this Section 2.07(a), "plurality" means that the individuals with the largest
number of votes are elected as directors up to the maximum number of directors
to be chosen at the Annual Meeting or Special Meeting.
(b) The Board of Directors acting by resolution may postpone and reschedule
any previously scheduled Annual Meeting or Special Meeting; provided, however,
that a Demand Special Meeting shall not be postponed beyond the 100th day
following the Delivery Date. Any Annual Meeting or Special Meeting may be
adjourned from time to time, whether or not there is a quorum, (i) at any time,
upon a resolution of shareholders if the votes cast in favor of such resolution
by the holders of shares of each voting group entitled to vote on any matter
theretofore properly brought before the meeting exceed the number of votes cast
against such resolution by the holders of shares of each such voting group or
(ii) at any time prior to the transaction of any business at such meeting, by
the Chairman of the Board or pursuant to resolution of the Board of Directors.
No notice of the time and place of adjourned meetings need be given except as
required by the Wisconsin Business Corporation Law. At any adjourned meeting at
which a quorum shall be present or represented, any business may be transacted
which might have been transacted at the meeting as originally notified.
2.08. Conduct of Meetings. The Chairman of the Board, and in his absence
the President, shall call any Annual Meeting or Special Meeting to order and
shall act as chairman of such meeting. In the absence of the Chairman of the
Board and the President, such duties shall be performed by a Vice-President in
the order provided under Section 4.07, or in their absence, by any person chosen
by the shareholders present. The Secretary of the corporation shall act as
secretary of all Annual Meetings and Special Meetings, but, in the absence of
the Secretary, the presiding officer may appoint any other person to act as
secretary of the meeting.
2.09. Proxies. At any Annual Meeting or Special Meeting, a shareholder
entitled to vote may vote in person or by proxy. A shareholder may appoint a
proxy to vote or otherwise act for the shareholder by signing an appointment
form, either personally or by his or her attorney-in-fact. An appointment of a
proxy is effective when received by the Secretary or other officer or agent of
the corporation authorized to tabulate votes. An appointment is valid for eleven
months from the date of its signing unless a different period is expressly
provided in the appointment form. The Board of Directors
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shall have the power and authority to make rules establishing presumptions as to
the validity and sufficiency of proxies.
2.10. Voting of Shares. Each outstanding share shall be entitled to one
vote upon each matter submitted to a vote at any Annual Meeting or Special
Meeting except to the extent that the voting rights of the shares of any class
or classes are enlarged, limited or denied by the Articles of Incorporation or
the Wisconsin Business Corporation Law.
2.11. Acceptance of Instruments Showing Shareholder Action. If the name
signed on a vote, consent, waiver or proxy appointment corresponds to the name
of a shareholder, the corporation, if acting in good faith, may accept the vote,
consent, waiver or proxy appointment and give it effect as the act of a
shareholder. If the name signed on a vote, consent, waiver or proxy appointment
does not correspond to the name of a shareholder, the corporation, if acting in
good faith, may accept the vote, consent, waiver or proxy appointment and give
it effect as the act of the shareholder if any of the following apply:
(a) The shareholder is an entity and the name signed purports to be that of
an officer or agent of the entity.
(b) The name purports to be that of a personal representative,
administrator, executor, guardian or conservator representing the shareholder
and, if the corporation requests, evidence of fiduciary status acceptable to the
corporation is presented with respect to the vote, consent, waiver or proxy
appointment.
(c) The name signed purports to be that of a receiver or trustee in
bankruptcy of the shareholder and, if the corporation requests, evidence of this
status acceptable to the corporation is presented with respect to the vote,
consent, waiver or proxy appointment.
(d) The name signed purports to be that of a pledgee, beneficial owner, or
attorney-in-fact of the shareholder and, if the corporation requests, evidence
acceptable to the corporation of the signatory's authority to sign for the
shareholder is presented with respect to the vote, consent, waiver or proxy
appointment.
(e) Two or more persons are the shareholders as co-tenants or fiduciaries
and the name signed purports to be the name of at least one of the co-owners and
the person signing appears to be acting on behalf of all co-owners.
The corporation may reject a vote, consent, waiver or proxy appointment if the
Secretary or other officer or agent of the corporation who is authorized to
tabulate votes, acting in good faith, has reasonable basis for doubt about the
validity of the signature on it or about the signatory's authority to sign for
the shareholder.
2.12. Waiver of Notice by Shareholders. A shareholder may waive any notice
required by the Wisconsin Business Corporation Law, the Articles of
Incorporation or these by-laws before or after the date and time stated in the
notice. The waiver shall be in writing and signed by the shareholder entitled to
the notice, contain the same information that would have been required in the
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notice under applicable provisions of the Wisconsin Business Corporation Law
(except that the time and place of meeting need not be stated) and be delivered
to the corporation for inclusion in the corporate records. A shareholder's
attendance at any Annual Meeting or Special Meeting, in person or by proxy,
waives objection to all of the following: (a) lack of notice or defective notice
of the meeting, unless the shareholder at the beginning of the meeting or
promptly upon arrival objects to holding the meeting or transacting business at
the meeting; and (b) consideration of a particular matter at the meeting that is
not within the purpose described in the meeting notice, unless the shareholder
objects to considering the matter when it is presented.
2.13. Notice of Shareholder Business and Nomination of Directors.
(a) Annual Meetings.
(i) Nominations of persons for election to the Board of Directors of
the corporation and the proposal of business to be considered by the
shareholders may be made at an Annual Meeting (A) pursuant to the
corporation's notice of meeting, (B) by or at the direction of the Board of
Directors or (C) by any shareholder of the corporation who is a shareholder
of record at the time of giving of notice provided for in this by-law and
who is entitled to vote at the meeting and complies with the notice
procedures set forth in this Section 2.13.
(ii) For nominations or other business to be properly brought before
an Annual Meeting by a shareholder pursuant to clause (C) of paragraph
(a)(i) of this Section 2.13, the shareholder must have given timely notice
thereof in writing to the Secretary of the corporation. To be timely, a
shareholder's notice shall be received by the Secretary of the corporation
at the principal executive offices of the corporation not less than 60 days
nor more than 90 days prior to the second Tuesday in the month of April;
provided, however, that in the event that the date of the Annual Meeting is
advanced by more than 30 days or delayed by more than 60 days from the
second Tuesday in the month of April, notice by the shareholder to be
timely must be so received not earlier than the 90th day prior to the date
of such Annual Meeting and not later than the close of business on the
later of (x) the 60th day prior to such Annual Meeting and (y) the 10th day
following the day on which public announcement of the date of such meeting
is first made. Such shareholder's notice shall be signed by the shareholder
of record who intends to make the nomination or introduce the other
business (or his duly authorized proxy or other representative), shall bear
the date of signature of such shareholder (or proxy or other
representative) and shall set forth: (A) the name and address, as they
appear on this corporation's books, of such shareholder and the beneficial
owner or owners, if any, on whose behalf the nomination or proposal is
made; (B) the class and number of shares of the corporation which are
beneficially owned by such shareholder or beneficial owner or owners; (C) a
representation that such shareholder is a holder of record of shares of the
corporation entitled to vote at such meeting and intends to appear in
person or by proxy at the meeting to make the nomination or introduce the
other business specified in the notice; (D) in the case of any proposed
nomination for election or re-election as a director, (I) the name and
residence address of the person or persons to be nominated, (II) a
description of all arrangements
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or understandings between such shareholder or beneficial owner or owners
and each nominee and any other person or persons (naming such person or
persons) pursuant to which the nomination is to be made by such
shareholder, (III) such other information regarding each nominee proposed
by such shareholder as would be required to be disclosed in solicitations
of proxies for elections of directors, or would be otherwise required to be
disclosed, in each case pursuant to Regulation 14A under the Exchange Act,
including any information that would be required to be included in a proxy
statement filed pursuant to Regulation 14A had the nominee been nominated
by the Board of Directors and (IV) the written consent of each nominee to
be named in a proxy statement and to serve as a director of the corporation
if so elected; and (E) in the case of any other business that such
shareholder proposes to bring before the meeting, (I) a brief description
of the business desired to be brought before the meeting and, if such
business includes a proposal to amend these by-laws, the language of the
proposed amendment, (II) such shareholder's and beneficial owner's or
owners' reasons for conducting such business at the meeting and (III) any
material interest in such business of such shareholder and beneficial owner
or owners.
(iii) Notwithstanding anything in the second sentence of paragraph
(a)(ii) of this Section 2.13 to the contrary, in the event that the number
of directors to be elected to the Board of Directors of the corporation is
increased and there is no public announcement naming all of the nominees
for director or specifying the size of the increased Board of Directors
made by the corporation at least 70 days prior to the second Tuesday in the
month of April, a shareholder's notice required by this Section 2.13 shall
also be considered timely, but only with respect to nominees for any new
positions created by such increase, if it shall be received by the
Secretary at the principal executive offices of the corporation not later
than the close of business on the 10th day following the day on which such
public announcement is first made by the corporation.
(b) Special Meetings. Only such business shall be conducted at a Special
Meeting as shall have been described in the notice of meeting sent to
shareholders pursuant to Section 2.04 of these by-laws. Nominations of persons
for election to the Board of Directors may be made at a Special Meeting at which
directors are to be elected pursuant to such notice of meeting (i) by or at the
direction of the Board of Directors or (ii) by any shareholder of the
corporation who (A) is a shareholder of record at the time of giving of such
notice of meeting, (B) is entitled to vote at the meeting and (C) complies with
the notice procedures set forth in this Section 2.13. Any shareholder desiring
to nominate persons for election to the Board of Directors at such a Special
Meeting shall cause a written notice to be received by the Secretary of the
corporation at the principal executive offices of the corporation not earlier
than 90 days prior to such Special Meeting and not later than the close of
business on the later of (x) the 60th day prior to such Special Meeting and (y)
the 10th day following the day on which public announcement is first made of the
date of such Special Meeting and of the nominees proposed by the Board of
Directors to be elected at such meeting. Such written notice shall be signed by
the shareholder of record who intends to make the nomination (or his duly
authorized proxy or other representative), shall bear the date of signature of
such shareholder (or proxy or other representative) and shall set forth: (A) the
name and address, as they appear on the corporation's books, of such shareholder
and the beneficial owner or owners, if any, on whose behalf the nomination is
made; (B) the class and number of shares of the corporation which are
beneficially owned by such shareholder or beneficial owner or owners; (C)
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a representation that such shareholder is a holder of record of shares of the
corporation entitled to vote at such meeting and intends to appear in person or
by proxy at the meeting to make the nomination specified in the notice; (D) the
name and residence address of the person or persons to be nominated; (E) a
description of all arrangements or understandings between such shareholder or
beneficial owner or owners and each nominee and any other person or persons
(naming such person or persons) pursuant to which the nomination is to be made
by such shareholder; (F) such other information regarding each nominee proposed
by such shareholder as would be required to be disclosed in solicitations of
proxies for elections of directors, or would be otherwise required to be
disclosed, in each case pursuant to Regulation 14A under the Exchange Act,
including any information that would be required to be included in a proxy
statement filed pursuant to Regulation 14A had the nominee been nominated by the
Board of Directors; and (G) the written consent of each nominee to be named in a
proxy statement and to serve as a director of the corporation if so elected.
(c) General.
(i) Only persons who are nominated in accordance with the procedures
set forth in this Section 2.13 shall be eligible to serve as directors.
Only such business shall be conducted at an Annual Meeting or Special
Meeting as shall have been brought before such meeting in accordance with
the procedures set forth in this Section 2.13. The chairman of the meeting
shall have the power and duty to determine whether a nomination or any
business proposed to be brought before the meeting was made in accordance
with the procedures set forth in this Section 2.13 and, if any proposed
nomination or business is not in compliance with this Section 2.13, to
declare that such defective proposal shall be disregarded.
(ii) For purposes of this Section 2.13, "public announcement" shall
mean disclosure in a press release reported by the Dow Jones News Service,
Associated Press or comparable national news service or in a document
publicly filed by the corporation with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.
(iii) Notwithstanding the foregoing provisions of this Section 2.13, a
shareholder shall also comply with all applicable requirements of the
Exchange Act and the rules and regulations thereunder with respect to the
matters set forth in this Section 2.13. Nothing in this Section 2.13 shall
be deemed to limit the corporation's obligation to include shareholder
proposals in its proxy statement if such inclusion is required by Rule
14a-8 under the Exchange Act.
ARTICLE III. BOARD OF DIRECTORS
3.01. General Powers and Number. All corporate powers shall be exercised by
or under the authority of, and the business and affairs of the corporation shall
be managed under the direction of, its Board of Directors. The number of
directors of the corporation shall be eleven (11).
3.02. Tenure and Qualifications. Each director shall hold office until the
next annual meeting of shareholders and until his successor shall have been
elected and qualified, or until there is a
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decrease in the number of directors which takes effect after the expiration of
his term, or until his prior death, resignation or removal. A director may be
removed by the shareholders only at a meeting called for the purpose of removing
the director, and the meeting notice shall state that the purpose, or one of the
purposes, of the meeting is removal of the director. A director may be removed
from office but only for cause (as defined herein) if the number of votes cast
to remove the director exceeds the number of votes cast not to remove him;
provided, however, that, if the Board of Directors, by resolution, shall have
recommended removal of a director, then the shareholders may remove such
director without cause by the vote referred to above. As used herein, "cause"
shall exist only if the director whose removal is proposed has been convicted of
a felony by a court of competent jurisdiction, where such conviction is no
longer subject to direct appeal, or has been adjudged liable for actions or
omissions in the performance of his duty to the corporation in a matter which
has had a materially adverse effect on the business of the corporation, where
such adjudication is no longer subject to appeal. A director may resign at any
time by delivering written notice which complies with the Wisconsin Business
Corporation Law to the Chairman of the Board or to the corporation. A director's
resignation is effective when the notice is delivered unless the notice
specifies a later effective date. Directors need not be residents of the State
of Wisconsin but must be shareholders of the corporation. Except as otherwise
provided by the Board of Directors, a director shall retire no later than the
end of the term in which occurs the earlier of the director's attainment of age
seventy (70) or the completion of fifteen (15) years of service as a
non-employee director; provided, however, that the fifteen (15) year limitation
shall be inapplicable to any director who had completed at least fifteen (15)
years as a non-employee director as of January 1, 1995. As used herein, a
"non-employee director" shall mean a director who is not an employee of the
corporation or any of its subsidiaries.
3.03. Regular Meetings. A regular meeting of the Board of Directors shall
be held without other notice than this by-law immediately after the Annual
Meeting, and each adjourned session thereof. The place of such regular meeting
shall be the same as the place of the Annual Meeting which precedes it, or such
other suitable place as may be announced at such Annual Meeting. The Board of
Directors may provide, by resolution, the time and place, either within or
without the State of Wisconsin, for the holding of additional regular meetings
without other notice than such resolution.
3.04. Special Meetings. Special meetings of the Board of Directors may be
called by or at the request of the Chairman of the Board, the President or any
three directors. The Chairman of the Board or the President may fix any place,
either within or without the State of Wisconsin, as the place for holding any
special meeting of the Board of Directors, and if no other place is fixed the
place of meeting shall be the principal business office of the corporation in
the State of Wisconsin.
3.05. Notice; Waiver. Notice of each meeting of the Board of Directors
(unless otherwise provided in or pursuant to Section 3.03) shall be given by
written notice delivered or communicated in person, by telegram, facsimile or
other form of wire or wireless communication, or by mail or private carrier, to
each director at his business address or at such other address as such director
shall have designated in writing filed with the Secretary, in each case not less
than 48 hours prior to the time of the meeting. If mailed, such notice shall be
deemed to be effective when deposited in the United States mail so addressed,
with postage thereon prepaid. If notice be given by telegram, such notice shall
be deemed to be effective when the telegram is delivered to the telegraph
company. If notice is given by private carrier, such notice shall be deemed to
be effective when the notice is delivered to the private carrier. Whenever any
notice whatever is required to be given to any director of the
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corporation under the Articles of Incorporation or these by-laws or any
provision of the Wisconsin Business Corporation Law, a waiver thereof in
writing, signed at any time, whether before or after the time of meeting, by the
director entitled to such notice, shall be deemed equivalent to the giving of
such notice. The corporation shall retain any such waiver as part of the
permanent corporate records. A director's attendance at or participation in a
meeting waives any required notice to him of the meeting unless the director at
the beginning of the meeting or promptly upon his arrival objects to holding the
meeting or transacting business at the meeting and does not thereafter vote for
or assent to action taken at the meeting. Neither the business to be transacted
at, nor the purpose of, any regular or special meeting of the Board of Directors
need be specified in the notice or waiver of notice of such meeting.
3.06. Quorum. Except as otherwise provided by the Wisconsin Business
Corporation Law or by the Articles of Incorporation or these by-laws, a majority
of the number of directors set forth in Section 3.01 shall constitute a quorum
for the transaction of business at any meeting of the Board of Directors, but a
majority of the directors present (though less than such quorum) may adjourn the
meeting from time to time without further notice.
3.07. Manner of Acting. The act of the majority of the directors present at
a meeting at which a quorum is present shall be the act of the Board of
Directors, unless the act of a greater number is required by the Wisconsin
Business Corporation Law or by the Articles of Incorporation or these by-laws.
3.08. Conduct of Meetings. The Chairman of the Board, and in his absence,
the President, or a Vice-President in the order provided under Section 4.07, and
in their absence, any director chosen by the directors present, shall call
meetings of the Board of Directors to order and shall act as chairman of the
meeting. The Secretary of the corporation shall act as secretary of all meetings
of the Board of Directors, but in the absence of the Secretary, the presiding
officer may appoint any Assistant Secretary or any director or other person
present to act as secretary of the meeting. Minutes of any regular or special
meeting of the Board of Directors shall be prepared and distributed to each
director.
3.09. Vacancies. Except as provided below, any vacancy occurring in the
Board of Directors, including a vacancy resulting from an increase in the number
of directors, may be filled by any of the following: (a) the shareholders; (b)
the Board of Directors; or (c) if the directors remaining in office constitute
fewer than a quorum of the Board of Directors, the directors, by the affirmative
vote of a majority of all directors remaining in office. If the vacant office
was held by a director elected by a voting group of shareholders, only the
holders of shares of that voting group may vote to fill the vacancy if it is
filled by the shareholders, and only the remaining directors elected by that
voting group may vote to fill the vacancy if it is filled by the directors. A
vacancy that will occur at a specific later date, because of a resignation
effective at a later date or otherwise, may be filled before the vacancy occurs,
but the new director may not take office until the vacancy occurs.
3.10. Compensation. The Board of Directors, by affirmative vote of a
majority of the directors then in office, and irrespective of any personal
interest of any of its members, may establish reasonable compensation of all
directors for services to the corporation as directors, officers or otherwise,
or may delegate such authority to an appropriate committee. The Board of
Directors also shall have authority to provide for or to delegate authority to
an appropriate committee to provide for
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reasonable pensions, disability or death benefits, and other benefits or
payments, to directors, officers and employees to the corporation.
3.11. Presumption of Assent. A director of the corporation who is present
at a meeting of the Board of Directors or a committee thereof of which he is a
member at which action on any corporate matter is taken shall be presumed to
have assented to the action taken unless any of the following occurs: (a) the
director objects at the beginning of the meeting or promptly upon his arrival to
holding the meeting or transacting business at the meeting; (b) the director
dissents or abstains from an action taken and minutes of the meeting are
prepared that show the director's dissent or abstention from the action taken;
(c) the director delivers written notice that complies with the Wisconsin
Business Corporation Law of his dissent or abstention to the presiding officer
of the meeting before its adjournment or to the corporation immediately after
adjournment of the meeting; or (d) the director dissents or abstains from an
action taken, minutes of the meeting are prepared that fail to show the
director's dissent or abstention from the action taken, and the director
delivers to the corporation a written notice of that failure that complies with
the Wisconsin Business Corporation Law promptly after receiving the minutes.
Such right to dissent or abstain shall not apply to a director who voted in
favor of such action.
3.12. Committees. The Board of Directors by resolution adopted by the
affirmative vote of a majority of the number of directors set forth in Section
3.01 may create one or more committees, appoint members of the Board of
Directors to serve on the committees and designate other members of the Board of
Directors to serve as alternates. Each committee shall have two or more members
who shall, unless otherwise provided by the Board of Directors, serve at the
pleasure of the Board of Directors. A committee may be authorized to exercise
the authority of the Board of Directors, except that a committee may not do any
of the following: (a) authorize distributions; (b) approve or propose to
shareholders action that the Wisconsin Business Corporation Law requires to be
approved by shareholders; (c) fill vacancies on the Board of Directors or,
unless the Board of Directors provides by resolution that vacancies on a
committee shall be filled by the affirmative vote of the remaining committee
members, on any Board committee; (d) amend the corporation's Articles of
Incorporation; (e) adopt, amend or repeal by-laws; (f) approve a plan of merger
not requiring shareholder approval; (g) authorize or approve reacquisition of
shares, except according to a formula or method prescribed by the Board of
Directors; and (h) authorize or approve the issuance or sale or contract for
sale of shares, or determine the designation and relative rights, preferences
and limitations of a class or series of shares, except that the Board of
Directors may authorize a committee to do so within limits prescribed by the
Board of Directors. Unless otherwise provided by the Board of Directors in
creating the committee, a committee may employ counsel, accountants and other
consultants to assist it in the exercise of its authority.
3.13. Telephonic Meetings. Except as herein provided and notwithstanding
any place set forth in the notice of the meeting or these by-laws, members of
the Board of Directors (and any committee thereof) may participate in regular or
special meetings by, or through the use of, any means of communication by which
all participants may simultaneously hear each other, such as by conference
telephone. If a meeting is conducted by such means, then at the commencement of
such meeting the presiding officer shall inform the participating directors that
a meeting is taking place at which official business may be transacted. Any
participant in a meeting by such means shall be deemed present in person at such
meeting. Notwithstanding the foregoing, no action may be taken at any meeting
held by
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such means on any particular matter which the presiding officer determines, in
his sole discretion, to be inappropriate under the circumstances for action at a
meeting held by such means. Such determination shall be made and announced in
advance of such meeting.
3.14. Unanimous Consent without Meeting. Any action required or permitted
by the Articles of Incorporation or these by-laws or any provision of the
Wisconsin Business Corporation Law to be taken by the Board of Directors (or a
committee thereof) at a meeting may be taken without a meeting if a consent in
writing, setting forth the action so taken, shall be signed by all members of
the Board or of the committee, as the case may be, then in office. Such action
shall be effective when the last director or committee member signs the consent,
unless the consent specifies a different effective date.
ARTICLE IV. OFFICERS
4.01. Number. The principal officers of the corporation shall be a Chairman
of the Board, a President, one or more Vice-Presidents, not to exceed six (6) at
any given time, a Secretary, and a Treasurer, each of whom shall be elected by
the Board of Directors. Such other officers and assistant officers as may be
deemed necessary may be elected or appointed by the Board of Directors. The
Board of Directors may also authorize any duly appointed officer to appoint one
or more officers or assistant officers. Any two or more offices may be held by
the same person.
4.02. Election and Term of Office. The officers of the corporation to be
elected by the Board of Directors shall be elected annually by the Board of
Directors at the first meeting of the Board of Directors held after the Annual
Meeting. If the election of officers shall not be held at such meeting, such
election shall be held as soon thereafter as conveniently may be. Each officer
shall hold office until his successor shall have been duly elected or until his
prior death, resignation or removal.
4.03. Removal and Resignation. The Board of Directors may remove any
officer and, unless restricted by the Board of Directors or these by-laws, an
officer may remove any officer or assistant officer appointed by that officer,
at any time, with or without cause and notwithstanding the contract rights, if
any, of the officer removed. Election or appointment shall not of itself create
contract rights. An officer may resign at any time by delivering notice to the
corporation that complies with the Wisconsin Business Corporation Law. The
resignation shall be effective when the notice is delivered, unless the notice
specifies a later effective date and the corporation accepts the later effective
date.
4.04. Vacancies. A vacancy in any principal office because of death,
resignation, removal, disqualification or otherwise, shall be filled by the
Board of Directors for the unexpired portion of the term. If a resignation of an
officer is effective at a later date as contemplated by Section 4.03 hereof, the
Board of Directors may fill the pending vacancy before the effective date if the
Board provides that the successor may not take office until the effective date.
4.05. Chairman of the Board. The Chairman of the Board shall, when present,
preside at all Annual Meetings and Special Meetings and at all meetings of the
Board of Directors. He shall perform such other duties and functions as shall be
assigned to him from time to time by the Board of Directors or in these by-laws.
Except where by law the signature of the President of the corporation is
required, the Chairman of the Board shall possess the same power and authority
as the President to
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sign, execute and acknowledge, on behalf of the corporation, all deeds,
mortgages, bonds, stock certificates, contracts, leases, reports and all other
documents or instruments and shall have such additional power to sign, execute
and acknowledge, on behalf of the corporation, as may be authorized by
resolution of the Board of Directors.
4.06. President. The President shall be the chief executive officer of the
corporation and, subject to the control of the Board of Directors, shall in
general supervise and control all of the business and affairs of the
corporation. He shall have authority, subject to such rules as may be prescribed
by the Board of Directors, to appoint such agents and employees of the
corporation as he shall deem necessary, to prescribe their powers, duties and
compensation, and to delegate authority to them. Such agents and employees shall
hold office at the discretion of the President. He shall have authority to sign,
execute and acknowledge, on behalf of the corporation, all deeds, mortgages,
bonds, stock certificates, contracts, leases, reports and all other documents or
instruments necessary or proper to be executed in the course of the
corporation's regular business, or which shall be authorized by resolution of
the Board of Directors; and, except as otherwise provided by law or the Board of
Directors, he may authorize any Vice President or other officer or agent of the
corporation to sign, execute and acknowledge such documents or instruments in
his place and stead. In general he shall perform all duties incident to the
office of President and such other duties as may be prescribed by the Board of
Directors from time to time.
4.07. The Vice-Presidents. In the absence of the President or in the event
of his death, inability or refusal to act, or in the event for any reason it
shall be impracticable for the President to act personally, the Vice-President
(or in the event there be more than one Vice-President, the Vice-Presidents in
the order designated by the Board of Directors, or in the absence of any
designation, then in the order of their election) shall perform the duties of
the President, and when so acting, shall have all the powers of and be subject
to all the restrictions upon the President. Any Vice-President may sign, with
the Secretary or Assistant Secretary, certificates for shares of the corporation
and shall perform such other duties and have such authority as from time to time
may be delegated or assigned to him by the President or by the Board of
Directors. The execution of any instrument of the corporation by any
Vice-President shall be conclusive evidence, as to third parties, of his
authority to act in the stead of the President.
4.08 The Secretary. The Secretary shall: (a) keep the minutes of all Annual
Meetings and Special Meetings and of all meetings of the Board of Directors in
one or more books provided for that purpose (including records of actions taken
without a meeting); (b) see that all notices are duly given in accordance with
the provisions of these by-laws or as required by the Wisconsin Business
Corporation Law; (c) be custodian of the corporate records and of the seal of
the corporation and see that the seal of the corporation is affixed to all
documents the execution of which on behalf of the corporation under its seal is
duly authorized; (d) maintain a record of the shareholders of the corporation,
in a form that permits preparation of a list of the names and addresses of all
shareholders, by class or series of shares and showing the number and class or
series of shares held by each shareholder; (e) sign with the Chairman of the
Board, the President, or a Vice-President, certificates for shares of the
corporation, the issuance of which shall have been authorized by resolution of
the Board of Directors; (f) have general charge of the stock transfer books of
the corporation; and (g) in general perform all duties incident to the office of
Secretary and have such other duties and exercise such
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authority as from time to time may be delegated or assigned to him by the
President or by the Board of Directors.
4.09. The Treasurer. The Treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) maintain
appropriate accounting records; (c) receive and give receipts for moneys due and
payable to the corporation from any source whatsoever, and deposit all such
moneys in the name of the corporation in such banks, trust companies or other
depositaries as shall be selected in accordance with the provisions of Section
5.04; and (d) in general perform all of the duties incident to the office of
Treasurer and have such other duties and exercise such other authority as from
time to time may be delegated or assigned to him by the President or by the
Board of Directors. If required by the Board of Directors, the Treasurer shall
give a bond for the faithful discharge of his duties in such sum and with such
surety or sureties as the Board of Directors shall determine.
4.10. Assistant Secretaries and Assistant Treasurers. There shall be such
number of Assistant Secretaries and Assistant Treasurers as the Board of
Directors may from time to time authorize. The Assistant Secretaries may sign
with the Chairman of the Board, the President or a Vice-President certificates
for shares of the corporation the issuance of which shall have been authorized
by a resolution of the Board of Directors. The Assistant Treasurers shall
respectively, if required by the Board of Directors, give bonds for the faithful
discharge of their duties in such sums and with such sureties as the Board of
Directors shall determine. The Assistant Secretaries and Assistant Treasurers,
in general, shall perform such duties and have such authority as shall from time
to time be delegated or assigned to them by the Secretary or the Treasurer,
respectively, or by the President or the Board of Directors.
4.11 Other Assistants and Acting Officers. The Board of Directors shall
have the power to appoint, or to authorize any duly appointed officer of the
corporation to appoint, any person to act as assistant to any officer, or as
agent for the corporation in his stead, or to perform the duties of such officer
whenever for any reason it is impracticable for such officer to act personally,
and such assistant or acting officer or other agent so appointed by the Board of
Directors or the appointing officer shall have the power to perform all the
duties of the office to which he is so appointed to be assistant, or as to which
he is so appointed to act, except as such power may be otherwise defined or
restricted by the Board of Directors or the appointing officer.
4.12 Salaries. The salaries of the principal officers shall be fixed from
time to time by the Board of Directors or by a duly authorized committee
thereof, and no officer shall be prevented from receiving such salary by reason
of the fact that he is also a director of the corporation.
ARTICLE V. CONTRACTS, LOANS, CHECKS AND DEPOSITS; SPECIAL
CORPORATE ACTS
5.01. Contracts. The Board of Directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute or deliver any
instrument in the name of and on behalf of the corporation, and such
authorization may be general or confined to specific instances. In the absence
of other designation, all deeds, mortgages and instruments of assignment or
pledge made by the corporation shall be executed in the name of the corporation
by the Chairman of the Board, the President
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or one of the Vice-Presidents and by the Secretary, an Assistant Secretary, the
Treasurer or an Assistant Treasurer; the Secretary or an Assistant Secretary,
when necessary or required, shall affix the corporate seal thereto; and when so
executed no other party to such instrument or any third party shall be required
to make any inquiry into the authority of the signing officer or officers.
5.02. Loans. No indebtedness for borrowed money shall be contracted on
behalf of the corporation and no evidences of such indebtedness shall be issued
in its name unless authorized by or under the authority of a resolution of the
Board of Directors. Such authorization may be general or confined to specific
instances.
5.03. Checks, Drafts, etc. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation, shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
or under the authority of a resolution of the Board of Directors.
5.04. Deposits. All funds of the corporation not otherwise employed shall
be deposited from time to time to the credit of the corporation in such banks,
trust companies or other depositories as may be selected by or under the
authority of a resolution of the Board of Directors.
5.05 Voting of Securities Owned by this Corporation. Subject always to the
specific directions of the Board of Directors, (a) any shares or other
securities issued by any other corporation and owned or controlled by this
corporation may be voted at any meeting of security holders of such other
corporation by the Chairman of the Board of this corporation if he be present,
or in his absence by the President of this corporation if he be present, or in
his absence by any Vice-President of this corporation who may be present, and
(b) whenever, in the judgment of the Chairman of the Board, or in his absence,
of the President, or in his absence, of any Vice-President, it is desirable for
this corporation to execute a proxy or written consent in respect to any shares
or other securities issued by any other corporation and owned by this
corporation, such proxy or consent shall be executed in the name of this
corporation by the Chairman of the Board, the President or one of the
Vice-Presidents of this corporation, without necessity of any authorization by
the Board of Directors, affixation of corporate seal or countersignature or
attestation by another officer. Any person or persons designated in the manner
above stated as the proxy or proxies of this corporation shall have full right,
power and authority to vote the shares or other securities issued by such other
corporation and owned by this corporation the same as such shares or other
securities might be voted by this corporation.
5.06. No Nominee Procedures. The corporation has not established, and
nothing in these by-laws shall be deemed to establish, any procedure by which a
beneficial owner of the corporation's shares that are registered in the name of
a nominee is recognized by the corporation as the shareholder under Section
180.0723 of the Wisconsin Business Corporation Law.
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ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
6.01. Certificates for Shares. Certificates representing shares of the
corporation shall be in such form, consistent with the Wisconsin Business
Corporation Law, as shall be determined by the Board of Directors. Such
certificates shall be signed by the Chairman of the Board, the President or a
Vice-President and by the Secretary or an Assistant Secretary. All certificates
for shares shall be consecutively numbered or otherwise identified. The name and
address of the person to whom the shares represented thereby are issued, with
the number of shares and date of issue, shall be entered on the stock transfer
books of the corporation. All certificates surrendered to the corporation for
transfer shall be cancelled and no new certificate shall be issued until the
former certificate for a like number of shares shall have been surrendered and
cancelled, except as provided in Section 6.06.
6.02. Facsimile Signatures and Seal. The seal of the corporation on any
certificates for shares may be a facsimile. The signatures of the Chairman of
the Board, the President or any Vice-President and the Secretary or Assistant
Secretary upon a certificate may be facsimiles if the certificate is
countersigned by a transfer agent, or registered by a registrar, other than the
corporation itself or an employee of the corporation.
6.03. Signature by Former Officers. In case any officer, who has signed or
whose facsimile signature has been placed upon any certificate for shares, shall
have ceased to be such officer before such certificate is issued, it may be
issued by the corporation with the same effect as if he were such officer at the
date of its issue.
6.04. Transfer of Shares. Prior to due presentment of a certificate for
shares for registration of transfer the corporation may treat the registered
owner of such shares as the person exclusively entitled to vote, to receive
notifications and otherwise to exercise all the rights and powers of an owner.
Where a certificate for shares is presented to the corporation with a request to
register for transfer, the corporation shall not be liable to the owner or any
other person suffering loss as a result of such registration of transfer if (a)
there were on or with the certificate the necessary endorsements, and (b) the
corporation had no duty to inquire into adverse claims or has discharged any
such duty. The corporation may require reasonable assurance that said
endorsements are genuine and effective and in compliance with such other
regulations as may be prescribed under the authority of the Board of Directors.
6.05. Restrictions on Transfer. The face or reverse side of each
certificate representing shares shall bear a conspicuous notation of any
restriction imposed by the corporation upon the transfer of such shares.
6.06. Lost, Destroyed or Stolen Certificates. Where the owner claims that
his certificate for shares has been lost, destroyed or wrongfully taken, a new
certificate shall be issued in place thereof if the owner (a) so requests before
the corporation has notice that such shares have been acquired by a bona fide
purchaser, and (b) files with the corporation a sufficient indemnity bond, and
(c) satisfies such other reasonable requirements as the Board of Directors may
prescribe.
6.07. Consideration for Shares. The Board of Directors may authorize shares
to be issued for consideration consisting of any tangible or intangible property
or benefit to the corporation,
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including cash, promissory notes, services performed, contracts for services to
be performed or other securities of the corporation. Before the corporation
issues shares, the Board of Directors shall determine that the consideration
received or to be received for the shares to be issued is adequate. In the
absence of a resolution adopted by the Board of Directors expressly determining
that the consideration received or to be received is adequate, Board approval of
the issuance of the shares shall be deemed to constitute such a determination.
The determination of the Board of Directors is conclusive insofar as the
adequacy of consideration for the issuance of shares relates to whether the
shares are validly issued, fully paid and nonassessable. The corporation may
place in escrow shares issued in whole or in part for a contract for future
services or benefits, a promissory note, or other property to be issued in the
future, or make other arrangements to restrict the transfer of the shares, and
may credit distributions in respect of the shares against their purchase price,
until the services are performed, the benefits or property are received or the
promissory note is paid. If the services are not performed, the benefits or
property are not received or the promissory note is not paid, the corporation
may cancel, in whole or in part, the shares escrowed or restricted and the
distributions credited.
6.08. Stock Regulation. The Board of Directors shall have the power and
authority to make all such further rules and regulations not inconsistent with
the statutes of the State of Wisconsin as it may deem expedient concerning the
issue, transfer and registration of certificates representing shares of the
corporation.
ARTICLE VII. SEAL
7.01. The Board of Directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words, "Corporate Seal".
ARTICLE VIII. INDEMNIFICATION
8.01. Certain Definitions. All capitalized terms used in this Article VIII
and not otherwise hereinafter defined in this Section 8.01 shall have the
meaning set forth in Section 180.0850 of the Statute. The following capitalized
terms (including any plural forms thereof) used in this Article VIII shall be
defined as follows:
(a) "Affiliate" shall include, without limitation, any corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise
that directly or indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, the Corporation.
(b) "Authority" shall mean the entity selected by the Director or Officer
to determine his or her right to indemnification pursuant to Section 8.04.
(c) "Board" shall mean the entire then elected and serving Board of
Directors of the Corporation, including all members thereof who are Parties to
the subject Proceeding or any related Proceeding.
(d) "Breach of Duty" shall mean the Director or Officer breached or failed
to perform his or her duties to the Corporation and his or her breach of or
failure to perform those duties
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is determined, in accordance with Section 8.04, to constitute misconduct under
Section 180.0851 (2) (a) 1, 2, 3 or 4 of the Statute.
(e) "Corporation," as used herein and as defined in the Statute and
incorporated by reference into the definitions of certain other capitalized
terms used herein, shall mean this Corporation, including, without limitation,
any successor corporation or entity to this Corporation by way of merger,
consolidation or acquisition of all or substantially all of the capital stock or
assets of this Corporation.
(f) "Director or Officer" shall have the meaning set forth in the Statute;
provided, that, for purposes of Article VIII, it shall be conclusively presumed
that any Director or Officer serving as a director, officer, partner, trustee,
member of any governing or decision-making committee, employee or agent of an
Affiliate shall be so serving at the request of the Corporation.
(g) "Disinterested Quorum" shall mean a quorum of the Board who are not
Parties to the subject Proceeding or any related Proceeding.
(h) "Party" shall have the meaning set forth in the Statute; provided,
that, for purposes of this Article VIII, the term "Party" shall also include any
Director or Officer or employee who is or was a witness in a Proceeding at a
time when he or she has not otherwise been formally named a Party thereto.
(i) "Proceeding" shall have the meaning set forth in the Statute; provided,
that, for purposes of this Article VIII, the term "Proceeding" shall also
include all Proceedings (i) brought under (in whole or in part) the Securities
Act of 1933, as amended, the Exchange Act, their respective state counterparts,
and/or any rule or regulation promulgated under any of the foregoing; (ii)
brought before an Authority or otherwise to enforce rights hereunder; (iii) any
appeal from a Proceeding; and (iv) any Proceeding in which the Director or
Officer is a plaintiff or petitioner because he or she is a Director or Officer;
provided, however, that such Proceeding is authorized by a majority vote of a
Disinterested Quorum.
(j) "Statute" shall mean Sections 180.0850 through 180.0859, inclusive, of
the Wisconsin Business Corporation Law, Chapter 180 of the Wisconsin Statutes,
as the same shall then be in effect, including any amendments thereto, but, in
the case of any such amendment, only to the extent such amendment permits or
requires the Corporation to provide broader indemnification rights than the
Statute permitted or required the Corporation to provide prior to such
amendment.
8.02. Mandatory Indemnification. To the fullest extent permitted or
required by the Statute, the Corporation shall indemnify a Director or Officer
against all Liabilities incurred by or on behalf of such Director or Officer in
connection with a Proceeding in which the Director or Officer is a Party because
he or she is a Director or Officer.
8.03. Procedural Requirements.
(a) A Director or Officer who seeks indemnification under Section 8.02
shall make a written request therefor to the Corporation. Subject to Section
8.03(b), within 60 days of the Corporation's receipt of such request, the
Corporation shall pay or reimburse the Director or Officer for
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the entire amount of Liabilities incurred by the Director or Officer in
connection with the subject Proceeding (net of any Expenses previously advanced
pursuant to Section 8.05).
(b) No indemnification shall be required to be paid by the Corporation
pursuant to Section 8.02 if, within such 60-day period, (i) a Disinterested
Quorum, by a majority vote thereof, determines that the Director or Officer
requesting indemnification engaged in misconduct constituting a Breach of Duty
or (ii) a Disinterested Quorum cannot be obtained.
(c) In either case of nonpayment pursuant to Section 8.03(b), the Board
shall immediately authorize by resolution that an Authority, as provided in
Section 8.04, determine whether the Director's or Officer's conduct constituted
a Breach of Duty and, therefore, whether indemnification should be denied
hereunder.
(d) (i) If the Board does not authorize an Authority to determine the
Director's or Officer's right to indemnification hereunder within such 60-day
period and/or (ii) if indemnification of the requested amount of Liabilities is
paid by the Corporation, then it shall be conclusively presumed for all purposes
that a Disinterested Quorum has determined that the Director or Officer did not
engage in misconduct constituting a Breach of Duty and, in the case of
subsection (i) above (but not subsection (ii)), indemnification by the
Corporation of the requested amount of Liabilities shall be paid to the Director
or Officer immediately.
8.04. Determination of Indemnification.
(a) If the Board authorizes an Authority to determine a Director's or
Officer's right to indemnification pursuant to Section 8.03, then the Director
or Officer requesting indemnification shall have the absolute discretionary
authority to select one of the following as such Authority:
(i) An independent legal counsel; provided, that such counsel shall be
mutually selected by such Director or Officer and by a majority vote of a
Disinterested Quorum or, if a Disinterested Quorum cannot be obtained, then
by a majority vote of the Board;
(ii) A panel of three arbitrators selected from the panels of
arbitrators of the American Arbitration Association in Milwaukee,
Wisconsin; provided, that (A) one arbitrator shall be selected by such
Director or Officer, the second arbitrator shall be selected by a majority
vote of a Disinterested Quorum or, if a Disinterested Quorum cannot be
obtained, then by a majority vote of the Board, and the third arbitrator
shall be selected by the two previously selected arbitrators, and (B) in
all other respects, such panel shall be governed by the American
Arbitration Association's then existing Commercial Arbitration Rules; or
(iii) A court pursuant to and in accordance with Section 180.0854 of
the Statute.
(b) In any such determination by the selected Authority there shall exist a
rebuttable presumption that the Director's or Officer's conduct did not
constitute a Breach of Duty and that indemnification against the requested
amount of Liabilities is required. The burden of rebutting such a
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<PAGE>
presumption by clear and convincing evidence shall be on the Corporation or such
other party asserting that such indemnification should not be allowed.
(c) The Authority shall make its determination within 60 days of being
selected and shall submit a written opinion of its conclusion simultaneously to
both the Corporation and the Director or Officer.
(d) If the Authority determines that indemnification is required hereunder,
the Corporation shall pay the entire requested amount of Liabilities (net of any
Expenses previously advanced pursuant to Section 8.05), including interest
thereon at a reasonable rate, as determined by the Authority, within 10 days of
receipt of the Authority's opinion; provided, that, if it is determined by the
Authority that a Director or Officer is entitled to indemnification as to some
claims, issues or matters, but not as to other claims, issues or matters,
involved in the subject Proceeding, the Corporation shall be required to pay (as
set forth above) only the amount of such requested Liabilities as the Authority
shall deem appropriate in light of all of the circumstances of such Proceeding.
(e) The determination by the Authority that indemnification is required
hereunder shall be binding upon the Corporation regardless of any prior
determination that the Director or Officer engaged in a Breach of Duty.
(f) All Expenses incurred in the determination process under this Section
8.04 by either the Corporation or the Director or Officer, including, without
limitation, all Expenses of the selected Authority, shall be paid by the
Corporation.
8.05. Mandatory Allowance of Expenses.
(a) The Corporation shall pay or reimburse, within 10 days after the
receipt of the Director's or Officer's written request therefor, the reasonable
Expenses of the Director or Officer as such Expenses are incurred; provided, the
following conditions are satisfied:
(i) The Director or Officer furnishes to the Corporation an executed
written certificate affirming his or her good faith belief that he or she
has not engaged in misconduct which constitutes a Breach of Duty; and
(ii) The Director or Officer furnishes to the Corporation an unsecured
executed written agreement to repay any advances made under this Section
8.05 if it is ultimately determined by an Authority that he or she is not
entitled to be indemnified by the Corporation for such Expenses pursuant to
this Section 8.04.
(b) If the Director or Officer must repay any previously advanced Expenses
pursuant to this Section 8.05, such Director or Officer shall not be required to
pay interest on such amounts.
8.06. Indemnification and Allowance of Expenses of Certain Others.
(a) The Corporation shall indemnify a director or officer of an Affiliate
(who is not otherwise serving as a Director or Officer) against all Liabilities,
and shall advance the reasonable
B-22
<PAGE>
Expenses, incurred by such director or officer in a Proceeding to the same
extent hereunder as if such director or officer incurred such Liabilities
because he or she was a Director or Officer, if such director or officer is a
Party thereto because he or she is or was a director or officer of the
Affiliate.
(b) The Corporation shall indemnify an employee who is not a Director or
Officer, to the extent that he or she has been successful on the merits or
otherwise in defense of a Proceeding, for all reasonable Expenses incurred in
the Proceeding if the employee was a Party because he or she was an employee of
the Corporation.
(c) The Board may, in its sole and absolute discretion as it deems
appropriate, pursuant to a majority vote thereof, indemnify (to the extent not
otherwise provided in Section 8.06(b) hereof) against Liabilities incurred by,
and/or provide for the allowance of reasonable Expenses of, an employee or
authorized agent of the Corporation acting within the scope of his or her duties
as such and who is not otherwise a Director or Officer.
8.07. Insurance. The Corporation may purchase and maintain insurance on
behalf of a Director or Officer or any individual who is or was an employee or
authorized agent of the Corporation against any Liability asserted against or
incurred by such individual in his or her capacity as such or arising from his
or her status as such, regardless of whether the Corporation is required or
permitted to indemnify against any such Liability under this Article VIII.
8.08. Notice to the Corporation. A Director, Officer or employee shall
promptly notify the Corporation in writing when he or she has actual knowledge
of a Proceeding which may result in a claim of indemnification against
Liabilities or allowance of Expenses hereunder, but the failure to do so shall
not relieve the Corporation of any liability to the Director, Officer or
employee hereunder unless the Corporation shall have been irreparably prejudiced
by such failure (as determined, in the case of Directors or Officers only, by an
Authority selected pursuant to Section 8.04(a)).
8.09. Severability. If any provision of this Article VIII shall be deemed
invalid or inoperative, or if a court of competent jurisdiction determines that
any of the provisions of this Article VIII contravene public policy, this
Article VIII shall be construed so that the remaining provisions shall not be
affected, but shall remain in full force and effect, and any such provisions
which are invalid or inoperative or which contravene public policy shall be
deemed, without further action or deed by or on behalf of the Corporation, to be
modified, amended and/or limited, but only to the extent necessary to render the
same valid and enforceable.
8.10. Nonexclusivity of Article VIII. The rights of a Director, Officer or
employee (or any other person) granted under this Article VIII shall not be
deemed exclusive of any other rights to indemnification against Liabilities or
advancement of Expenses which the Director, Officer or employee (or such other
person) may be entitled to under any written agreement, Board resolution, vote
of shareholders of the Corporation or otherwise, including, without limitation,
under the Statute. Nothing contained in this Article VIII shall be deemed to
limit the Corporation's obligations to indemnify against Liabilities or advance
Expenses to a Director, Officer or employee under the Statute.
8.11. Contractual Nature of Article VIII; Repeal or Limitation of Rights.
This Article VIII shall be deemed to be a contract between the Corporation and
each Director, Officer and
B-23
<PAGE>
employee of the Corporation and any repeal or other limitation of this Article
VIII or any repeal or limitation of the Statute or any other applicable law
shall not limit any rights of indemnification against Liabilities or allowance
of Expenses then existing or arising out of events, acts or omissions occurring
prior to such repeal or limitation, including, without limitation, the right to
indemnification against Liabilities or allowance of Expenses for Proceedings
commenced after such repeal or limitation to enforce this Article VIII with
regard to acts, omissions or events arising prior to such repeal or limitation.
ARTICLE IX. AMENDMENTS
9.01. By Shareholders. These by-laws may be altered, amended or repealed
and new by-laws may be adopted by the shareholders at any Annual Meeting or
Special Meeting at which a quorum is in attendance.
9.02. By Directors. These by-laws may also be altered, amended or repealed
and new by-laws may be adopted by the Board of Directors by affirmative vote of
a majority of the number of directors present at any meeting at which a quorum
is in attendance; provided, however, that the shareholders in adopting, amending
or repealing a particular by-law may provide therein that the Board of Directors
may not amend, repeal or readopt that by-law.
9.03. Implied Amendments. Any action taken or authorized by the
shareholders or by the Board of Directors, which would be inconsistent with the
by-laws then in effect but is taken or authorized by affirmative vote of not
less than the number of shares or the number of directors required to amend the
by-laws so that the by-laws would be consistent with such action, shall be given
the same effect as though the by-laws had been temporarily amended or suspended
so far, but only so far, as is necessary to permit the specific action so taken
or authorized.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF BANTA CORPORATION AS OF AND FOR THE
NINE MONTHS ENDED OCTOBER 3, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-02-1999
<PERIOD-START> JAN-04-1998
<PERIOD-END> OCT-03-1998
<CASH> 6,293
<SECURITIES> 13,990
<RECEIVABLES> 246,742
<ALLOWANCES> 3,584
<INVENTORY> 85,205
<CURRENT-ASSETS> 376,867
<PP&E> 748,080
<DEPRECIATION> 423,290
<TOTAL-ASSETS> 785,843
<CURRENT-LIABILITIES> 203,717
<BONDS> 123,792
0
0
<COMMON> 2,894
<OTHER-SE> 416,745
<TOTAL-LIABILITY-AND-EQUITY> 785,843
<SALES> 990,491
<TOTAL-REVENUES> 990,491
<CGS> 788,813
<TOTAL-COSTS> 788,813
<OTHER-EXPENSES> 126,992
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,965
<INCOME-PRETAX> 66,356
<INCOME-TAX> 25,700
<INCOME-CONTINUING> 40,656
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 40,656
<EPS-PRIMARY> 1.37<F1>
<EPS-DILUTED> 1.37
<FN>
<F1> THE EPS UNDER THE "EPS-PRIMARY" TAG REPRESENTS BASIC
EARNINGS PER SHARE
</FN>
</TABLE>
