SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. ___)
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Filed by a Party other than the Registrant [ ]
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[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
BANTA CORPORATION
---------------------
(Name of Registrant as Specified in its Charter)
--------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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BANTA CORPORATION
225 Main Street
Menasha, Wisconsin 54952
Notice of Annual Meeting of Shareholders
To Be Held April 23, 2002
To the Shareholders of Banta Corporation:
You are hereby notified that the annual meeting of shareholders of
Banta Corporation will be held at the Radisson Paper Valley Hotel, 333 West
College Avenue, Appleton, Wisconsin, on Tuesday, April 23, 2002 at 2:00 p.m.,
Central Time, for the following purposes:
1. To elect nine directors to serve for the ensuing year.
2. To transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on March 1,
2002 as the record date for the determination of the shareholders entitled to
notice of and to vote at the annual meeting.
We hope that you will be able to attend the meeting in person, but if
you are unable to do so, please fill in, sign and promptly mail back the
enclosed proxy form, using the return envelope provided. If, for any reason, you
should subsequently change your plans, you may, of course, revoke your proxy at
any time before it is actually voted.
By Order of the Board of Directors
BANTA CORPORATION
/s/ Ronald D. Kneezel
Ronald D. Kneezel
Secretary
Menasha, Wisconsin
March 15, 2002
BANTA CORPORATION
225 Main Street
Menasha, Wisconsin 54952
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 23, 2002
This proxy statement is being furnished to shareholders by the Board
of Directors (the "Board") of Banta Corporation (the "Company"), beginning on or
about March 15, 2002, in connection with a solicitation of proxies by the Board
for use at the annual meeting of shareholders to be held on Tuesday, April 23,
2002, at 2:00 p.m., Central Time, at the Radisson Paper Valley Hotel, 333 West
College Avenue, Appleton, Wisconsin, and all adjournments or postponements
thereof (the "Annual Meeting"), for the purposes set forth in the attached
Notice of Annual Meeting of Shareholders.
Execution of a proxy given in response to this solicitation will not
affect a shareholder's right to attend the Annual Meeting and to vote in person.
Presence at the Annual Meeting of a shareholder who has signed a proxy does not
in itself revoke a proxy. Any shareholder giving a proxy may revoke it at any
time before it is voted by giving notice thereof to the Company in writing or in
open meeting, by attending the Annual Meeting and voting in person, or by
delivering a proxy bearing a later date.
A proxy, in the enclosed form, which is properly executed, duly
returned to the Company and not revoked will be voted in accordance with the
instructions contained therein. The shares represented by executed but unmarked
proxies will be voted FOR the nine persons nominated for election as directors
referred to herein and on such other business or matters which may properly come
before the Annual Meeting in accordance with the best judgment of the persons
named as proxies in the enclosed form of proxy. Other than the election of
directors, the Board has no knowledge of any matters to be presented for action
by the shareholders at the Annual Meeting.
Only holders of record of the Company's common stock, $.10 par value
(the "Common Stock"), at the close of business on March 1, 2002 are entitled to
notice of and to vote at the Annual Meeting. On that date, the Company had
outstanding and entitled to vote 25,010,892 shares of Common Stock, each of
which is entitled to one vote per share.
ELECTION OF DIRECTORS
At the Annual Meeting, the shareholders will elect nine directors of
the Company, each to hold office until the 2003 annual meeting of shareholders
and until his or her successor is duly elected and has qualified. Set forth
below are the Board's nominees to serve as directors of the Company. Unless
shareholders otherwise specify, the shares represented by the proxies received
will be voted in favor of the election as directors of the
nine persons named as nominees herein. The Board has no reason to believe that
any of the listed nominees will be unable or unwilling to serve as a director if
elected. However, in the event that any nominee should be unable or unwilling to
serve, the shares represented by proxies received will be voted for another
nominee selected by the Board.
The following sets forth certain information, as of March 1, 2002,
about each of the Board nominees for election at the Annual Meeting. Except as
otherwise noted, each nominee has engaged in the principal occupation or
employment and has held the offices shown for more than the past five years.
Director Principal Occupation; Office, if any,
Name Age Since Held in the Company; Other Directorships
-----------------------------------------------------------------------------------------------------
Jameson A. Baxter 58 1991 President of Baxter Associates, Inc. (management
consulting and private investments); Trustee of
The Putnam Funds; Director of Ryerson Tull, Inc.
Donald D. Belcher 63 1994 Chairman and Chief Executive Officer of the Company
since January 2001; Chairman, President and Chief
Executive Officer of the Company prior thereto;
Director of Hunt Corporation.
John F. Bergstrom 55 1998 Chairman and Chief Executive Officer of Bergstrom
Corporation (automobile sales and service, credit life
insurance, and automotive fleet leasing); Director of
Kimberly-Clark Corporation, Midwest Express Holdings,
Inc., Sensient Technologies Corporation and Wisconsin
Energy Corporation.
Ursula M. Burns 43 2002 President of the Xerox Document Systems and Solutions
Group and Corporate Senior Vice President of Xerox
Corporation (a document management and solutions
company) since October 2001; senior management
positions with Xerox Corporation prior thereto;
Director of Hunt Corporation.
Henry T. DeNero 56 1996 Former Chairman and Chief Executive Officer of
HomeSpace, Inc. (homeowner services); Former Executive
Vice President of First Data Corporation (an
information processing and computer services company);
Former Vice Chairman and Chief Financial Officer of
Dayton Hudson Corporation; Director of Western Digital
Corporation.
-2-
Richard L. Gunderson 68 1995 Former Chairman and Chief Executive Officer of Aid
Association for Lutherans (fraternal benefit society
providing insurance and financial services.)
Ray C. Richelsen 60 1998 Executive Vice President-Transportation, Graphics and
Safety Markets of 3M Company (a manufacturer of
optical films and specialty materials) from January
1998 until his retirement in August 2000; Group Vice
President of 3M Company prior thereto.
Stephanie A. Streeter 44 2001 President and Chief Operating Officer of the Company
since January 2001; Chief Operating Officer of idealab!
(creator and operator of internet businesses) from
January 2000 to December 2000; Group Vice President
of Avery Dennison Corporation (diversified manufacturing
company) from 1996 to 2000.
Michael J. Winkler 56 1996 Executive Vice President, Global Business Units, of
Compaq Computer Corporation (computer services).
Directors are elected by a plurality of the votes cast (assuming a
quorum is present). An abstention from voting will be tabulated as a vote
withheld on the election, and will be included in computing the number of shares
present for purposes of determining the presence of a quorum, but will not be
considered in determining whether each of the nominees has received a plurality
of the votes cast at the Annual Meeting. A broker or nominee holding shares
registered in its name, or the name of its nominee, which are beneficially owned
by another person and for which it has not received instructions as to voting
from the beneficial owner, has the discretion to vote the beneficial owner's
shares with respect to the election of directors.
THE BOARD RECOMMENDS THE FOREGOING NOMINEES FOR ELECTION AS DIRECTORS
AND URGES EACH SHAREHOLDER TO VOTE "FOR" ALL NOMINEES. SHARES OF COMMON STOCK
REPRESENTED BY EXECUTED BUT UNMARKED PROXIES WILL BE VOTED "FOR" ALL NOMINEES.
-3-
BOARD OF DIRECTORS
General
The Board held five meetings in 2001. Each director attended at least
75% of the aggregate of (a) the total number of meetings of the Board and (b)
the total number of meetings held by all committees of the Board on which the
director served during 2001, other than Mr. Winkler.
The Company has Audit, Compensation, and Nominating and Corporate
Governance Committees of the Board. The Audit Committee consists of Messrs.
Gunderson (Chairperson) and Richelsen and Bernard S. Kubale. Mr. Kubale will
retire as a director of the Company effective at the time of the Annual Meeting.
The principal functions performed by the Audit Committee, which met three times
in 2001, are to meet with the Company's independent public accountants before
the annual audit to review procedures and the scope of the audit; to review the
results of the audit; to review the financial control mechanisms used by the
Company and the adequacy of the Company's accounting and financial controls; and
to annually recommend to the Board a firm of independent public accountants to
serve as the Company's auditors. The Compensation Committee consists of Ms.
Baxter (Chairperson) and Messrs. Bergstrom, Gunderson and Richelsen. The
principal functions of the Compensation Committee, which met four times in 2001,
are to administer the Company's deferred and incentive compensation plans
(including the Company's equity incentive plans); to annually evaluate salary
grades and ranges; to establish guidelines concerning average compensation
increases; to establish performance criteria for and to evaluate the performance
of the Chief Executive Officer; and to specifically establish compensation of
all officers, directors and subsidiary or division presidents. The Nominating
and Corporate Governance Committee consists of Ms. Baxter and Messrs. DeNero
(Chairperson), Gunderson, Kubale and Winkler. The principal functions of the
Nominating and Corporate Governance Committee, which met one time in 2001, are
to recommend persons to be selected by the Board as nominees for election as
directors; to recommend persons to be elected to fill any vacancies on the
Board; to consider and recommend to the Board qualifications for the office of
director and policies concerning the term of office of directors and the
composition of the Board; and to consider and recommend to the Board other
actions relating to corporate governance. The Nominating and Corporate
Governance Committee will consider persons recommended by shareholders to become
nominees for election as directors. Recommendations for consideration by the
Nominating and Corporate Governance Committee should be sent to the Secretary of
the Company in writing together with appropriate biographical information
concerning each proposed nominee. The Company's By-laws also set forth certain
requirements for shareholders wishing to nominate director candidates directly
for consideration by the shareholders. With respect to an election of directors
to be held at an annual meeting, a shareholder must, among other things, give
written notice of an intent to make such a nomination to the Secretary of the
Company in advance of the meeting in compliance with the terms and within the
time period specified in the By-laws.
-4-
Director Compensation
Annual Retainer and Meeting Fees. For fiscal 2001, directors of the
Company, other than full time employees and Mr. Kubale, received an annual
retainer fee of $26,000 ($13,000 of which was payable in shares of Common
Stock). In addition, the directors in fiscal 2001 were paid a fee of $1,000 for
every Board and committee meeting they attended. Each committee chairperson
received an additional $5,000 for serving in such capacity ($2,500 of which was
payable in shares of Common Stock). A director may elect to defer all or any
part of the cash compensation he or she is entitled to receive for serving as a
director, in which case the amount deferred will be paid in cash in three annual
installments after such person ceases to be a director and, at the direction of
the director, either will be credited with interest at the prime rate or will be
treated for valuation purposes as if such deferred compensation had been
invested in Common Stock pursuant to the phantom stock subaccount under the
director's deferred compensation plan. The portion of the retainer fee payable
in Common Stock may also be deferred. Such amount will be credited to the
phantom stock subaccount and will ultimately be paid in cash in the same manner
as cash retainer fees which are deferred.
Director Stock Options. In addition to the compensation described
above, each of Ms. Baxter and Messrs. DeNero, Gunderson, Kubale, Bergstrom,
Richelsen and Winkler automatically received an option for 3,000 shares of
Common Stock at a per share exercise price of $26.00 on April 25, 2001, in
accordance with the terms of the Company's Equity Incentive Plan (the "Equity
Plan"). In addition, Ms. Burns automatically received an option for 6,000 shares
of Common Stock at a per share exercise price of $29.52 upon her election to the
Board in January 2002. Under the terms of the Equity Plan, each person when
first elected as a non-employee director of the Company automatically receives
an option for 6,000 shares of Common Stock. The Equity Plan also provides that,
subsequent to the initial grant, each non-employee director (who continues to
serve in such capacity) automatically receives an option to purchase an
additional 3,000 shares of Common Stock on the day after each annual meeting of
shareholders; provided, however, that if a person who is first elected as a
non-employee director on the date of the annual meeting of shareholders receives
the initial option grant under the Equity Plan on that date, such director will
not be entitled to begin receiving subsequent grants until the day following the
next succeeding annual meeting of shareholders. Options granted to non-employee
directors under the Equity Plan have a per share exercise price equal to 100% of
the market value of a share of Common Stock on the date of grant and become
exercisable six months after the date of grant, except that if the non-employee
director ceases to be a director by reason of death, disability or retirement
during such six-month period, the option will become immediately exercisable in
full. Options granted to non-employee directors under the Equity Plan terminate
on the earlier of (a) ten years after the date of grant or (b) twelve months
after the non-employee director ceases to be a director.
-5-
STOCK OWNERSHIP
Management
The following table sets forth information, as of March 1, 2002,
regarding beneficial ownership of Common Stock by each director and nominee,
each of the executive officers named in the Summary Compensation Table set forth
below, and all of the directors and executive officers as a group. As of March
1, 2002, no director or executive officer of the Company beneficially owned one
percent or more of the Common Stock other than Mr. Belcher who owned 1.5% of the
Common Stock. On that date, the directors and executive officers as a group
beneficially owned 3.2% of the Common Stock. Except as otherwise indicated in
the footnotes, all of the persons listed below have sole voting and investment
power over the shares of Common Stock identified as beneficially owned.
Amount and Nature of
Name of Beneficial Owner Beneficial Ownership(1)(2)
------------------------ --------------------
Jameson A. Baxter......................... 25,375
Donald D. Belcher......................... 391,125 (3)
John F. Bergstrom......................... 15,946 (4)
Ursula M. Burns........................... 441
Henry T. DeNero........................... 15,800
Richard L. Gunderson...................... 19,500
Gerald A. Henseler........................ 147,058 (5)
Bernard S. Kubale......................... 18,615
Ray C. Richelsen.......................... 10,500
Stephanie A. Streeter..................... 21,667
Michael J. Winkler........................ 24,981
Ronald D. Kneezel......................... 64,479
Dennis J. Meyer........................... 52,009
All directors and executive
officers as a group (14 persons)........ 810,830
-----------------------
(1) Includes shares subject to currently exercisable options and options
exercisable within 60 days of March 1, 2002 as follows: Ms. Baxter, 12,000
shares; Mr. Belcher, 339,167 shares; Mr. Bergstrom, 10,500 shares; Mr.
DeNero, 13,500 shares; Mr. Gunderson, 12,000 shares; Mr. Henseler, 64,333
shares; Mr. Kubale, 12,000 shares; Mr. Richelsen, 10,500 shares; Ms.
Streeter, 21,667 shares; Mr. Winkler, 13,500 shares; Mr. Kneezel, 46,500
shares; Mr. Meyer, 43,000 shares; and all directors and executive officers
as a group, 602,001 shares.
(2) Does not include holdings of phantom stock units by non-employee directors
as follows: Ms. Baxter, 5,899 units; Mr. Bergstrom, 2,006 units; Mr.
DeNero, 8,083 units; Mr. Gunderson, 5,069 units; Mr. Kubale, 2,969 units;
Mr. Richelsen, 4,183 units; and
-6-
Mr. Winkler, 2,456 units. The value of the phantom stock units is based
upon and fluctuates with the market value of the Common Stock.
(3) Includes 1,000 shares held by Mr. Belcher's spouse. Mr. Belcher shares
voting and investment power over these shares.
(4) Includes 2,350 shares held by a trust, 2,000 shares held by a partnership,
and 900 shares held by a trust for the benefit of Mr. Bergstrom's daughter.
Mr. Bergstrom shares voting and investment power over these shares.
(5) Includes 27,608 shares held by Mr. Henseler's spouse and 4,869 shares held
by trusts for the benefit of Mr. Henseler's daughter. Mr. Henseler shares
voting and investment power over these shares. Mr. Henseler will retire as
a director of the Company effective at the time of the Annual Meeting and
as an officer of the Company on August 1, 2002.
Other Beneficial Owners
The following table sets forth information, as of December 31, 2001,
regarding beneficial ownership by the only persons known to the Company to own
more than 5% of the outstanding Common Stock. The beneficial ownership set forth
below has been reported on filings made on Schedule 13G with the Securities and
Exchange Commission by the beneficial owners.
Amount and Nature of Beneficial Ownership
-----------------------------------------
Voting Power Investment Power
------------ ----------------
Percent
Name and Address of
of Beneficial Owner Sole Shared Sole Shared Aggregate Class
------------------- ---- ------ ---- ------ --------- -----
Barclays Global Investors, Ltd. 1,762,306 0 1,841,996 0 1,841,996 7.4%
Murray House
1 Royal Mint Court
London, England
J.L. Kaplan Associates, LLC 1,323,650 0 1,727,900 0 1,727,900 6.9%
222 Berkeley Street
Suite 2010
Boston, MA 02116
-7-
EXECUTIVE COMPENSATION
Summary Compensation Information
The following table sets forth certain information for each of the
last three fiscal years concerning compensation awarded to, earned by or paid to
certain executive officers of the Company. The persons named in the table are
sometimes referred to herein as the "named executive officers."
Summary Compensation Table
Long Term Compensation
----------------------
Annual Compensation (1) Awards Payouts
----------------------- Securities ---------
Underlying LTIP All Other
Name and Principal Position Year Salary Bonus Options Payouts(2) Compensation(3)
--------------------------- ---- ------ ----- ------- ---------- ---------------
Donald D. Belcher 2001 $ 650,000 $ 322,165 110,000 $140,051 $ 3,400
Chairman of the Board 2000 550,000 508,200 100,000 140,238 3,400
and Chief Executive Officer 1999 525,000 378,000 170,000 69,655 3,200
Stephanie A. Streeter (4) 2001 438,461 155,123 130,000 12,195 73,063
President and Chief 2000 -- -- -- -- --
Operating Officer 1999 -- -- -- -- --
Gerald A. Henseler 2001 365,000 51,944 - 312,795 3,400
Executive Vice President 2000 352,500 271,425 - 91,906 3,400
1999 339,000 203,400 20,000 46,668 3,082
Ronald D. Kneezel 2001 230,000 25,308 15,000 276,509 3,400
Vice President, General 2000 206,000 126,896 12,000 53,600 3,400
Counsel and Secretary 1999 198,000 95,040 12,000 27,163 2,986
Dennis J. Meyer 2001 215,000 23,657 14,000 276,165 3,400
Vice President 2000 206,000 126,896 12,000 53,659 3,400
Marketing and Planning 1999 198,000 95,040 12,000 27,222 2,691
----------------------------
(1) Certain personal benefits provided by the Company to the named executive officers are not included in the
table. The aggregate amount of such personal benefits for each named executive officer in each year reflected
in the table did not exceed the lesser of $50,000 or 10% of the sum of such officer's salary and bonus in each
respective year.
(2) For fiscal 2001, consists of payments made pursuant to the Banta Corporation Economic Profit (EP) Long-Term
Incentive Compensation Plan. In addition, for each of Messrs. Henseler, Kneezel and Meyer includes a payout in
fiscal 2001 of $225,000 under the Banta Corporation Key Management Retention Plan. Mr. Belcher and Ms.
Streeter did not participate in the Key Management Retention Plan.
(3) For fiscal 2001, consists of Company matching contributions under the Company's Incentive Savings Plan, which
is a profit sharing plan under Section 401(k) of the Internal Revenue Code, for Messrs. Belcher, Henseler,
Kneezel and Meyer. For Ms. Streeter for fiscal 2001, consists of a $3,400 Company matching contribution under
the Incentive Savings Plan and a relocation allowance of $69,663 paid in connection with Ms. Streeter's
commencement of employment with the Company.
(4) Ms. Streeter was appointed President and Chief Operating Officer of the Company on January 22, 2001.
-8-
Stock Options
The Company has in effect equity plans pursuant to which
options to purchase Common Stock may be granted to key employees (including
executive officers) of the Company and its subsidiaries. The following table
presents certain information as to grants of stock options made during fiscal
2001 to each of the named executive officers. Due to his upcoming retirement,
Mr. Henseler was not granted any stock options in fiscal 2001.
Option Grants in 2001 Fiscal Year
Grant
Date
Individual Grants Value
--------------------------------------------------------------------------------------------- --------------
Percentage of
Number of Total Options
Securities Granted to Exercise or Grant Date
Underlying Employees in Base Price Expiration Present
Name Options Granted(1) Fiscal Year ($/share) Date Value (2)
---- ------------------ ----------- --------- ---- ---------
Donald D. Belcher......... 110,000 14.2% $28.45 11/5/11 $1,172,600
Stephanie A. Streeter..... 65,000 8.4 25.73 1/22/11 673,400
65,000 8.4 28.45 11/5/11 709,150
Ronald D. Kneezel......... 15,000 1.9 28.45 11/5/11 159,900
Dennis J. Meyer........... 14,000 1.8 28.45 11/5/11 149,240
-----------------------
(1) The options reflected in the table (which are nonstatutory stock options for purposes of the Internal Revenue Code)
were granted on November 5, 2001 (January 22, 2001 in the case of the first option grant to Ms. Streeter) and vest
ratably over the three-year period following the date of grant. The options are subject to early vesting in the
case of the optionee's death, disability or retirement.
(2) The option values presented are based on the Black-Scholes option pricing model adopted for use in valuing stock
options. Material assumptions and adjustments incorporated in the Black-Scholes model in estimating the value of
the options reflected in the table above include the following: (a) an exercise price of the option equal to the
fair market value of the underlying stock on the date of grant; (b) a risk-free rate of return representing the
interest rate on a U.S. Treasury security with a maturity date corresponding to the term of the option; (c)
volatility of 33.9% (35.8% in the case of the options granted to Ms. Streeter on January 22, 2001), which was
calculated using daily Common Stock prices for the one-year period prior to the date of grant; (d) a dividend yield
equal to 2.3% representing the dividend yield on the Common Stock as of the date of grant; (e) an option term of
ten years; and (f) reductions of 15.6% to reflect the probability of forfeiture due to termination prior to vesting
and 20.9% (19.3% in the case of the options granted to Ms. Streeter on January 22, 2001) to reflect the probability
of a shortened option term due to termination of employment prior to the expiration date. The actual value, if any,
that an optionee may realize upon exercise will depend on the excess of the price of the Common Stock over the
option exercise price on the date that the option is exercised. There is no assurance that the value realized by an
optionee will be at or near the value estimated under the Black-Scholes model.
The following table sets forth information regarding the exercise of stock
options by each of the named executive officers during the 2001 fiscal year and
the fiscal year-end value of unexercised options held by the named executive
officers.
-9-
Aggregated Option Exercises in 2001 Fiscal Year and Fiscal Year-End Option Values
Number of Securities Value of Unexercised In-the-
Underlying Unexercised Money Options at Fiscal
Shares Options at Fiscal Year-End Year-End (1)
Acquired Value -------------------------- ----------------------------
Name on Exercise Realized(1) Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ----------- ----------- ------------- ----------- -------------
Donald D. Belcher.................. -- $ -- 389,167 233,333 $2,449,313 $1,414,912
Stephanie A. Streeter.............. -- -- 0 130,000 0 386,100
Gerald A. Henseler................. 18,000 90,000 64,333 6,667 261,824 43,736
Ronald D. Kneezel.................. -- -- 58,500 27,000 325,420 143,870
Dennis J. Meyer.................... 800 3,760 51,200 26,000 279,902 142,260
---------------
(1) The dollar values are calculated by determining the difference between the fair market value of the underlying Common
Stock and the exercise price of the options at exercise or fiscal year-end, as the case may be.
Pension Plan Benefits
The following table sets forth the estimated annual pension benefits
payable to a covered participant at normal retirement age under the Company's
Employees Pension Plan as well as under the Company's Supplemental Retirement
Plan (which, in part, provides benefits that would otherwise be denied
participants by reason of (i) certain Internal Revenue Code limitations on
qualified benefit plans and (ii) the exclusion of cash incentive awards and
deferred compensation in calculating benefits under the qualified plan). The
benefits that are payable under the pension and retirement plans are based upon
remuneration that is covered under the plans and years of service with the
Company and its subsidiaries.
Pension Plan Table
Average Monthly Yearly Pension After
Compensation in Five Specified Years of Service
Highest Consecutive Years 10 Years 15 Years 20 Years 25 Years 30 Years 35 Years
------------------------- -------- -------- -------- -------- -------- --------
$ 24,000 $72,000 $93,600 $115,200 $136,800 $158,400 $180,000
36,000 108,000 140,400 172,800 205,200 237,600 270,000
48,000 144,000 187,200 230,400 273,600 316,800 360,000
60,000 180,000 234,000 288,000 342,000 396,000 450,000
72,000 216,000 280,800 345,600 410,400 475,200 540,000
84,000 252,000 327,600 403,200 478,800 554,400 630,000
96,000 288,000 374,400 460,800 547,200 633,600 720,000
108,000 324,000 421,200 518,400 615,600 712,800 810,000
120,000 360,000 468,000 576,000 684,000 792,000 900,000
A participant's remuneration covered by the Company's pension
arrangement is such participant's base salary, annual bonus and long-term
incentive compensation. The covered remuneration paid for each of the last three
fiscal years to the named executive officers is set forth in the Summary
Compensation Table under the headings "Salary", "Bonus" and "LTIP Payouts"
(exclusive of payouts under the Key Management Retention Plan). As of December
31, 2001, Messrs. Belcher, Henseler, Kneezel and Meyer had completed 7, 35, 13
and 8 years of credited service under the Company's pension plans,
-10-
respectively. On such date, Ms. Streeter had one year of credited service.
Benefits shown in the table are computed as a straight single life annuity
assuming retirement at age 65. The benefits reflected in the table are not
subject to reduction for Social Security benefits.
Agreements with Named Executive Officers
The Company has an agreement with Mr. Henseler which provides for
certain benefits in the event of termination of employment after a change of
control of the Company. The principal benefits are: (a) a bonus under any
Company bonus or incentive plan or plans for the year in which termination
occurs; (b) continued salary payments and life insurance and medical and
disability insurance for a maximum of four years, with reduced payments for a
surviving spouse; (c) additional pension benefits to fully or partially
compensate for the reduction of benefits under the Company's pension plan due to
termination of employment; and (d) full exercise rights for all stock options
for three months following termination of employment. These benefits are made
available if Mr. Henseler's employment is terminated by the Company other than
for cause as defined in the agreement or if he terminates his employment because
of significant changes made in his working conditions or status without his
consent. Continued salary payments and insurance benefits are to be reduced by
corresponding payments and benefits obtained from any successor employer. The
transactions which are deemed to result in a "change of control" of the Company
for purposes of Mr. Henseler's agreement include: (1) the acquisition of more
than 30% of the voting stock of the Company by any person, organization or
group; (2) the sale of all or substantially all of the Company's business or
assets; (3) a consolidation or merger, unless the Company or a subsidiary is the
surviving corporation; (4) the acquisition of assets or stock of another entity
if in connection with the acquisition new persons become directors of the
Company and constitute a majority of the Board; and (5) the election in
opposition to the nominees proposed by management of two or more directors in
any one election on behalf of any person, organization or group.
The Company also has agreements with Messrs. Belcher, Kneezel and
Meyer, Ms. Streeter and certain other officers and key employees which, in
addition to benefits similar to those described in (a), (c) and (d) above,
provide for continued employment for periods of from two to three years after a
change of control (the "Employment Period") and for lump-sum termination
payments equal to three times the executive's base salary plus the highest
incentive compensation earned by the executive in any year during the preceding
three years if employment is terminated during the Employment Period by the
Company (other than for cause or disability) or by the executive due to
significant changes in his or her working conditions or status without his or
her consent. The agreements also provide the foregoing benefits in connection
with certain terminations which are effected in anticipation of a change of
control. Under the agreements, the executive's employee benefits such as health,
accident and life insurance will also be continued following a termination for
which a termination payment is made for up to three years or until comparable
benefits are available from a new employer. The agreements provide that, if any
payments thereunder constitute an "excess parachute payment" under the Internal
Revenue Code, the Company will pay the officer the amount necessary to offset
the excise tax and any additional taxes resulting from the payment
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of an excess parachute payment. In addition, the Company has agreed to pay Mr.
Belcher a severance payment of two year's salary (and continue to provide health
insurance for two years) if, prior to a change of control, the Company
terminates his employment other than for cause or disability. Ms. Streeter has a
similar agreement that provides for a severance payment of one year's salary
(and the continuation of health insurance for one year) if, prior to a change of
control, the Company terminates her employment other than for cause or
disability.
The Company has deferred compensation plans for key employees in which
the named executive officers are eligible to participate and which provide for
deferral of salary and cash incentive compensation. Payments under the deferred
compensation plans generally commence following retirement of the participant.
However, in the event of a change of control, a participant in the deferred
compensation plans will receive a lump sum payment. The lump sum payment will be
equal to the present value of the participant's future benefits if the
participant is receiving benefits at the time of such change of control or the
amount standing to the participant's credit in his or her deferred compensation
account if the participant is not otherwise entitled to receive benefits at the
time of such change of control. The Company has entered into an executive trust
agreement with a third party trust company to provide a means of segregating
assets for the payment of these benefits (as well as benefits under the
Company's Supplemental Retirement Plan), subject to claims of the Company's
creditors. Such trust is only nominally funded until the occurrence of a
potential change of control.
The Company also has an agreement with Mr. Henseler providing for
monthly payments of $2,000 for 120 months in the event that Mr. Henseler's
employment is terminated by the Company or as a result of his death or if Mr.
Henseler retires after age 62. The agreement provides that Mr. Henseler may
designate a beneficiary to receive the payments to which he is entitled in the
event of his death prior to the receipt of any or all such payments. Payments
under the agreement may be forfeited in the event Mr. Henseler engages in
specified competitive activities during the first four years following his
retirement or such termination.
Committee Report on Executive Compensation
The Compensation Committee of the Board is responsible for all aspects
of the Company's compensation package offered to its executive officers,
including the named executive officers. The following is a report of the
Compensation Committee regarding executive compensation:
Policies Governing Executive Compensation. The Company's general
policies relating to executive compensation are: (a) to establish a direct link
between executive compensation and the annual, intermediate-term and long-term
performance of the Company; (b) to provide performance-based compensation
opportunities (including equity-based awards) which allow executive officers to
earn rewards for maximizing shareholder value; (c) to attract and retain the key
executives necessary for the Company's long-term success; and (d) to reward
individual initiative and the achievement of specified goals. In applying these
general
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policies, the objective of the Compensation Committee has been to ensure that a
significant portion of the compensation paid to senior executive officers, such
as the named executive officers, be incentive-based since these individuals have
significant control and responsibility for the Company's direction and
performance.
Executive Compensation Package. As reflected under the section
entitled "Executive Compensation," the Company's executive compensation package
currently consists of a mix of salary, annual and long-term bonus awards and
stock option grants as well as benefits under the employee benefit plans offered
by the Company.
In setting and adjusting executive salaries, including the salaries of
the Chief Executive Officer and the other named executive officers, the
Compensation Committee, in conjunction with the Company's independent
compensation consultants, has historically compared the base salaries paid or
proposed to be paid by the Company with the ranges of salaries paid by
corporations of similar size relative to the Company and operating in comparable
industries. It is the judgment of the Compensation Committee that a review of
the compensation practices of companies with such characteristics is appropriate
in establishing competitive salary ranges for the Company's executive officers.
Based on its analysis of comparative data, the Compensation Committee
increased the minimum, midpoint and maximum ranges for each salary grade by 3.0%
for fiscal 2001. The Compensation Committee also approved a 4.3% guideline for
2001 executive officer base salary increases, subject to individual variances to
reflect above or below average performance. In establishing salaries for each
individual executive officer, Mr. Belcher, the Company's Chief Executive
Officer, made specific recommendations for salary adjustments (other than his
own) to the Compensation Committee based on the foregoing guidance provided by
the Committee as well as a review of industry comparables, the level of
responsibility delegated to the particular executive officer, the expertise and
skills offered by each officer, the officer's individual job performance and the
performance of the group over which the individual had responsibility. These
various factors were considered on a case-by-case basis and no specific formula
was used to give any one factor a relative weight as compared to the others. The
Compensation Committee reviewed the foregoing recommendations and then made
final decisions on the base salaries to be paid by the Company. The Compensation
Committee also reviewed and fixed the base salary of Mr. Belcher for 2001 based
on similar competitive compensation data and individual job performance
criteria. The base salary paid to Mr. Belcher for fiscal 2001 was $650,000.
The Compensation Committee has adopted the Economic Profit (EP)
Incentive Compensation Plan (the "EP Incentive Plan"), which provides an annual
incentive for certain employees of the Company, including the named executive
officers. The factors on which awards under the EP Incentive Plan are based
include: (i) earnings per share performance; (ii) the creation of economic
profit for the Company; and (iii) for participants affiliated with a specific
business unit, the operating earnings and the creation of economic profit for
such unit. An award under the EP Incentive Plan may also have a discretionary
component based on such criteria as the Committee may determine. For purposes of
the economic value creation
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component of the formula, the EP Incentive Plan defines economic profit as the
difference between (a) net operating profit after tax and (b) the charge for
capital employed in the business. The EP Incentive Plan is designed to reward
executive officers and key managers for EPS performance, productive use of
Company assets, reduction of costs and creation of efficiencies throughout the
Company's organization. Under the EP Incentive Plan, target bonuses calculated
as a percentage of salary are fixed by the Compensation Committee as are
economic profit levels. The EP Incentive Plan also incorporates a "bonus bank"
into which that portion of an award, if any, in excess of 200% of target is
credited. Such bonus amounts are thereafter scheduled to be paid out over three
years contingent (other than in the case of death, disability, retirement or
termination without cause) upon the participant's continued employment with the
Company. Under the EP Incentive Plan, Mr. Belcher received a payout of $322,165
for the 2001 fiscal year.
The Compensation Committee has also adopted the Economic Profit (EP)
Long-Term Incentive Compensation Plan (the "EP Long-Term Plan"), which provides
long-term incentives for certain employees of the Company, including the named
executive officers. The EP Long-Term Plan is similar to the EP Incentive Plan.
Awards paid under the EP Long-Term Plan to the executive officers are paid based
entirely on Company performance (EPS and economic profit performance) and are
paid out in three annual installments contingent (other than in the case of
death, disability, retirement or termination without cause) upon the
participant's continued employment with the Company. Mr. Belcher received an
award of $140,051 under the EP Long-Term Plan in 2001.
During 2001 the Company also had in effect the Key Management
Retention Plan that provided an incentive to certain key executives based on the
Company's aggregate earnings per share over a two-year period ended March 31,
2001. Payments under the Retention Plan were based on the Company's cumulative
earnings per share on a fully diluted basis for the period from April 4, 1999
through March 31, 2001. For each full cent that such earnings per share exceeded
$3.60, each participant received 1.25% of his maximum award, but in no case more
than 100% of the maximum award. Based on the Company's performance, participants
were paid 100% of their maximum awards during fiscal year 2001. Mr. Belcher did
not participate in the Retention Plan. Awards made to those named executive
officers who participated in the Retention Plan are included in the Summary
Compensation Table.
In addition to the foregoing annual and long-term incentive plans, the
Company's executive compensation package has historically included stock option
grants. The Compensation Committee has the authority to grant, in addition to
stock options, other equity-based awards, including stock appreciation rights,
restricted stock and performance shares. To date, however, only stock options
have been granted under the Company's equity-based plans. Stock options granted
by the Compensation Committee have a per share exercise price of 100% of the
fair market value of a share of Common Stock on the date of grant and,
accordingly, the value of the option will be dependent on the future market
value of the Common Stock. It has been the policy of the Compensation Committee
that options should
-14-
provide a long-term incentive and align the interests of management with the
interests of shareholders.
In determining proposed stock option grants to be made to the
Company's executive officers, the Compensation Committee reviews, in
consultation with the Company's independent compensation consultants, option
grants made by a select group of peer companies. Based on this analysis, Mr.
Belcher received an option to purchase 110,000 shares of Common Stock at a per
share exercise price of $28.45 on November 5, 2001. By tying a portion of each
executive officer's overall compensation to stock price through the grant of
options, the Compensation Committee seeks to enhance its objective of providing
a further incentive to maximize long-term shareholder value.
In connection with the equity-based plans, the Company endorses the
policy that stock ownership by management is an important factor in aligning the
interests of management and shareholders. The Company has adopted stock
ownership guidelines that are intended to encourage stock ownership by
management. Under these guidelines, management personnel are expected to own a
specified number of shares of Common Stock depending upon their respective
salary grade. The Compensation Committee considers an individual's compliance
with the stock ownership guidelines in determining the size of equity-based
grants.
The Company's policy with respect to other employee benefit plans is
to provide competitive benefits to the Company's employees, including executive
officers, to encourage their continued service with the Company. In the view of
the Compensation Committee, a competitive benefits package is an essential
component in achieving the Company's goal of being able to attract new key
employees from time to time as events warrant.
Under Section 162(m) of the Internal Revenue Code, the tax deduction
by corporate taxpayers, such as the Company, is limited with respect to the
compensation of certain executive officers unless such compensation is based
upon performance objectives meeting certain regulatory criteria or is otherwise
excluded from the limitation. The Compensation Committee currently intends, in
all appropriate circumstances, to qualify compensation paid to the Company's
executive officers for deductibility by the Company under Section 162(m) of the
Internal Revenue Code.
BANTA CORPORATION COMPENSATION COMMITTEE
Jameson A. Baxter, Chairperson
John F. Bergstrom
Richard L. Gunderson
Ray C. Richelsen
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REPORT OF THE AUDIT COMMITTEE
The Audit Committee of the Board is composed of three directors, each
of whom is independent as defined in the New York Stock Exchange's listing
standards. The Audit Committee operates under a written charter adopted by the
Board. On an annual basis, the Audit Committee makes a recommendation to the
Board regarding the selection of the Company's independent auditors. Arthur
Andersen LLP served as the Company's independent auditors for the fiscal year
ended December 29, 2001.
The Company's management is responsible for the Company's internal
controls and the financial reporting process, including the system of internal
controls. The Company's independent auditors are responsible for expressing an
opinion on the conformity of the Company's audited consolidated financial
statements with accounting principles generally accepted in the United States.
The Audit Committee's responsibility is to monitor and oversee this process.
The Audit Committee has reviewed and discussed the audited
consolidated financial statements of the Company for the fiscal year ended
December 29, 2001 with management and the independent auditors. The Audit
Committee has discussed with the independent auditors matters required to be
discussed by Statement on Auditing Standards No. 61 (Communication with Audit
Committees).
The Company's independent auditors have provided to the Audit
Committee the written disclosures required by Independence Standards Board
Standard No. 1 (Independence Discussions with Audit Committees), and the
Committee discussed with the independent auditors their independence. The Audit
Committee considered whether the independent auditors provision of non-audit
services is compatible with maintaining the independent auditors' independence.
The fees paid to the independent auditors for fiscal 2001 were as follows:
Audit Fees $231,000
Financial Information Systems Design
and Implementation Fees $262,000
All Other Fees:
Audit-related fees* $150,000
All other fees 363,000
--------
Total all other fees $513,000
========
* Audit-related fees include statutory audits of subsidiaries, benefit plan
audits, accounting consultation, various attest services under professional
standards, assistance with registration statements, and consents.
The Audit Committee discussed with the Company's internal and
independent auditors the overall scopes and plans for their respective audits.
The Audit Committee meets with the internal and independent auditors, with and
without management present, to discuss
-16-
the results of their examinations, the evaluation of the Company's internal
controls and overall quality of the Company's financial reporting.
Based on the Audit Committee's reviews and discussions with
management, the internal auditors and the independent auditors referred to
above, the Audit Committee recommended to the Board that the audited
consolidated financial statements be included in the Company's Annual Report on
Form 10-K for the year ended December 29, 2001 for filing with the Securities
and Exchange Commission.
BANTA CORPORATION AUDIT COMMITTEE
Richard L. Gunderson, Chairperson
Ray C. Richelsen
Bernard S. Kubale
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PERFORMANCE INFORMATION
Set forth below are line graphs during the last five years comparing
the Company's cumulative total shareholder return with the cumulative total
return of companies in the Standard & Poor's 500 Stock Index and companies in a
peer group selected in good faith by the Company. The total return information
presented in the graphs assumes the reinvestment of dividends. The companies in
the peer group are: Cadmus Communications Corp.; Courier Corp.; R. R. Donnelley
& Sons Company; and Quebecor World Inc. The returns of each company in the peer
group have been weighted based on such company's relative market capitalization.
Comparison Of Five Year Cumulative Total Return
Among Banta Corporation, S&P 500 Index And Peer Group Companies
[STOCK PERFORMANCE CHART]
December 31,
1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ----
Banta Value............... $ 100 $ 120 $ 124 $ 105 $ 122 $ 145
S&P 500 Composite......... 100 133 171 205 185 160
Peer Group................ 100 122 144 89 101 100
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP acted as the independent auditors for the Company
during the fiscal year ended December 29, 2001. Representatives of Arthur
Andersen LLP are expected to be present at the Annual Meeting to answer
appropriate questions and, if they so desire, to make a statement. The Company's
independent auditors for fiscal year 2002 will be appointed later in the year.
OTHER MATTERS
Solicitation Expenses
All expenses of solicitation of proxies will be borne by the Company.
In addition to soliciting proxies by mail, proxies may be solicited personally
and by telephone by certain officers and regular employees of the Company. The
Company has retained D.F. King & Co., Inc. to assist in the solicitation of
proxies, and expects to pay such firm a fee of approximately $4,000 plus
out-of-pocket expenses. Brokers, nominees and custodians who hold Common Stock
in their names and who solicit proxies from the beneficial owners will be
reimbursed by the Company for out-of-pocket and reasonable clerical expenses.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors to file reports of ownership and changes of
ownership with the Securities
-18-
and Exchange Commission and the New York Stock Exchange. The regulations of the
Securities and Exchange Commission require the officers and directors to furnish
the Company with copies of all Section 16(a) forms they file. Based on such
forms, the Company believes that all its officers and directors have complied
with the Section 16(a) filing requirements, except for Mr. Meyer who
inadvertently failed to timely file to reflect a transaction under the Company's
401(k) plan. Mr. Meyer subsequently made the necessary filing.
Related Party Transaction
The Company has an agreement with Compaq Computer Corporation pursuant
to which the Company provides various supply-chain management services in
connection with the configuration, testing and worldwide distribution of
Compaq's hard drives. Michael J. Winkler, a director of the Company, is an
Executive Vice President of Compaq. The Company's revenue attributable to its
contract with Compaq totaled $115.6 million in 2001. The Company currently
expects that revenue from the Compaq contract in fiscal 2002 will be comparable
to the fiscal 2001 revenue.
Delivery of Proxy Materials to Households
Pursuant to the rules of the Securities and Exchange Commission,
services that deliver the Company's communications to shareholders that hold
their stock through a bank, broker or other holder of record may deliver to
multiple shareholders sharing the same address a single copy of the Company's
annual report to shareholders and this proxy statement. Upon oral or written
request, the Company will promptly deliver a separate copy of the annual report
to shareholders and/or proxy statement to any shareholder at a shared address to
which a single copy of each document was delivered. Shareholders may notify the
Company of their requests by calling or writing Ronald D. Kneezel, Vice
President, General Counsel and Secretary, Banta Corporation, P.O. Box 8003,
Menasha, Wisconsin 54952, telephone number: (920) 751-7777.
SHAREHOLDER PROPOSALS
Proposals of shareholders pursuant to Rule 14a-8 under the Securities
Exchange Act of 1934 ("Rule 14a-8") that are intended to be presented at the
2003 annual meeting of shareholders must be received by the Company no later
than November 15, 2002 to be included in the Company's proxy materials for that
meeting. Further, a shareholder who otherwise intends to present business at the
2003 annual meeting must comply with the requirements set forth in the Company's
By-laws. Among other things, to bring business before an annual meeting, a
shareholder must give written notice thereof, complying with the By-laws, to the
Secretary of the Company not less than 60 days and not more than 90 days prior
to the second Tuesday in the month of April, provided that the date of the
annual meeting is not advanced by more than 30 days or delayed by more than 60
days from the second Tuesday in the month of April. The 2003 annual meeting of
shareholders is tentatively scheduled to be held on April 29, 2003. Under the
By-laws, if the Company does not receive notice of a shareholder proposal
submitted otherwise than pursuant to Rule 14a-8 (i.e., a
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proposal a shareholder intends to present at the 2003 annual meeting of
shareholders but does not intend to have included in the Company's proxy
materials) on or prior to February 7, 2003 (assuming an April 29, 2003 meeting
date), then the notice will be considered untimely and the Company will not be
required to present such proposal at the 2003 annual meeting. If the Board
nonetheless chooses to present such proposal at the 2003 annual meeting, then
the persons named in proxies solicited by the Board for the 2003 annual meeting
may exercise discretionary voting power with respect to such proposal.
By Order of the Board of Directors
BANTA CORPORATION
/s/ Ronald D. Kneezel
Ronald D. Kneezel
Secretary
The Company will furnish to any shareholder, without charge, a copy of its
Annual Report on Form 10-K for the fiscal year 2001. Requests for the Form 10-K
must be in writing and addressed to Gerald A. Henseler, Executive Vice
President, Banta Corporation, P.O. Box 8003, Menasha, Wisconsin 54952.
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BANTA CORPORATION
Proxy for Annual Meeting of Shareholders to be held April 23, 2002
The undersigned constitutes and appoints DONALD D. BELCHER and RONALD
D. KNEEZEL, or either of them, the true and lawful proxies of the undersigned,
with full power of substitution, to represent and to vote as designated below,
all shares of Banta Corporation which the undersigned is entitled to vote at the
annual meeting of shareholders of such corporation to be held at the Radisson
Paper Valley Hotel, 333 West College Avenue, Appleton, Wisconsin on April 23,
2002, at 2:00 P.M., Central Time, and at all adjournments or postponements
thereof.
The shares represented by this proxy when properly executed will be
voted in the manner directed herein by the undersigned shareholder, but, if no
direction is indicated, this proxy will be voted FOR all indicated nominees as
directors (Item 1).
The undersigned hereby revokes any other proxy heretofore executed by
the undersigned for the meeting and acknowledges receipt of notice of the annual
meeting and the proxy statement. This proxy is solicited on behalf of the Board
of Directors of Banta Corporation.
+ PLEASE MARK, SIGN AND DATE ON REVERSE SIDE, DETACH AND RETURN USING THE ENVELOPE PROVIDED +
--------------------- ---------------------
BANTA CORPORATION 2002 ANNUAL MEETING
1. ELECTION OF DIRECTORS: 1-Jameson A. Baxter 6-Richard L. Gunderson [ ] FOR all nominees [ ] WITHHOLD
2-Donald D. Belcher 7-Ray C. Richelsen listed to the left AUTHORITY
3-John F. Bergstrom 8-Stephanie A. Streeter (except as to vote for all
4-Ursula M. Burns 9-Michael J. Winkler specified nominees
5-Henry T. DeNero below). listed to the
left.
-----------------------------------------
(Instructions: To withhold authority to vote for any indicated nominee(s), write the
number(s) of the nominee(s) in the box provided to the right.) ===>
-----------------------------------------
2. In their discretion upon all such other business as may properly come before the meeting.
Date ___________________________ NO. OF SHARES
-----------------------------------------
Check appropriate box
Indicate change below:
Address Change? [ ] Name Change? [ ]
-----------------------------------------
Signature(s) in Box
Please sign exactly as your name appears on
your stock certificate. Joint owners should
each sign personally. A corporation should
sign full corporate name by a duly
authorized officer. When signing as
attorney, executor, administrator, trustee
or guardian, give full title as such.
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