-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ONg12v1k6Kn4tEIqkD3N8XdUNQ3hpKmLNs3JlWVWLCSKoh/YSG5wl76KvXqWvIIE URNs83SK46H4hMj5O+NOzA== 0000310142-98-000006.txt : 19980814 0000310142-98-000006.hdr.sgml : 19980814 ACCESSION NUMBER: 0000310142-98-000006 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19980813 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNIVERSAL FOODS CORP CENTRAL INDEX KEY: 0000310142 STANDARD INDUSTRIAL CLASSIFICATION: BEVERAGES [2080] IRS NUMBER: 390561070 STATE OF INCORPORATION: WI FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-07626 FILM NUMBER: 98686142 BUSINESS ADDRESS: STREET 1: 433 EAST MICHIGAN ST CITY: MILWAUKEE STATE: WI ZIP: 53202 BUSINESS PHONE: 4142716755 MAIL ADDRESS: STREET 1: PO BOX 737 CITY: MILWAUKEE STATE: WI ZIP: 53201 10-Q 1 =============================================================================== UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 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: 1-7626 UNIVERSAL FOODS CORPORATION ----------------------------------------------------- (Exact name of registrant as specified in its charter) Wisconsin 39-0561070 - ------------------------------- ---------------------------- (State or other jurisdiction of (I.R.S. Employer Identification incorporation or organization) Number) 433 East Michigan Street, Milwaukee, Wisconsin 53202 ----------------------------------------------------- (Address of principal executive offices) Registrant's telephone number, including area code: (414) 271-6755 --------------- NONE - -------------------------------------------------------------------------------- (Former name, address, and fiscal year, if changed since last report.) 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 such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for at least the past 90 days. Yes X No ----- ------ Indicate the number of shares outstanding of each of the issuer's classes of Common Stock as of the latest practicable date. Class Outstanding at July 31,1998 - --------------------------------------- --------------------------- Common Stock, par value $0.10 per share 51,199,254 shares =============================================================================== UNIVERSAL FOODS CORPORATION INDEX Page No. -------- PART I, FINANCIAL INFORMATION: Consolidated Condensed Balance Sheets - June 30, 1998 and September 30, 1997. 1 Consolidated Condensed Statements of Earnings - Three and Nine Months Ended June 30, 1998 and 1997. 2 Consolidated Condensed Statements of Cash Flows - Nine Months Ended June 30, 1998 and 1997. 3 Notes to Consolidated Condensed Financial Statements. 4 Management's Discussion and Analysis of Results of Operations, Financial Condition and Forward Looking Information. 6 PART II, OTHER INFORMATION: Item 2, Changes in Securities 8 Item 6, Exhibits and Reports on Form 8-K. 9 Signatures. 10 Exhibit Index 11
PART I FINANCIAL INFORMATION UNIVERSAL FOODS CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS ($000's Omitted) June 30, 1998 September 30, ASSETS (Unaudited) 1997 - ------ -------- -------- CURRENT ASSETS: Cash and cash equivalents $ 4,702 $ 1,258 Trade accounts receivable 121,739 117,259 Inventory: Finished and in-process products 130,576 132,150 Raw materials and supplies 53,688 53,402 Prepaid expenses and other current assets 44,048 38,179 -------- -------- TOTAL CURRENT ASSETS 354,753 342,248 INVESTMENTS AND OTHER ASSETS 59,898 55,193 INTANGIBLES 198,693 181,309 PROPERTY, PLANT AND EQUIPMENT: Cost: Land and buildings 150,304 147,659 Machinery and equipment 447,635 388,402 -------- -------- 597,939 536,061 Less accumulated depreciation 257,232 227,082 -------- -------- 340,707 308,979 -------- -------- TOTAL ASSETS $954,051 $887,729 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY - ------------------------------------ CURRENT LIABILITIES: Short-term borrowings $ 43,541 $ 7,971 Accounts payable and accrued expenses 115,970 135,522 Salaries, wages and withholdings from employees 11,954 13,978 Income taxes 19,937 16,151 Current maturities of long-term debt 4,939 4,905 -------- -------- TOTAL CURRENT LIABILITIES 196,341 178,527 DEFERRED INCOME TAXES 17,543 17,550 OTHER DEFERRED LIABILITIES 19,751 20,798 ACCRUED EMPLOYEE AND RETIREE BENEFITS 37,412 37,877 LONG-TERM DEBT 282,479 252,526 SHAREHOLDERS' EQUITY Common stock 5,396 2,698 Additional paid-in capital 74,714 76,774 Earnings reinvested in the business 402,894 371,444 -------- -------- 483,004 450,916 Less: Treasury stock, at cost 47,694 45,742 Other 34,785 24,723 -------- -------- 400,525 380,451 -------- -------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $954,051 $887,729 ======== ======== See Accompanying Notes to Consolidated Condensed Financial Statements.
-1- UNIVERSAL FOODS CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (000's Omitted Except Per Share Amounts) (Unaudited) Three Months Nine Months Ended June 30 Ended June 30 ---------------- -------------- 1998 1997 1998 1997 ---- ---- ---- ---- Revenue $214,506 $209,725 $628,410 $608,035 Operating costs and expenses: Cost of products sold 139,512 140,315 409,093 406,206 Selling and administrative expenses 40,347 39,723 124,764 119,318 -------- -------- -------- -------- Total operating costs and expenses 179,859 180,038 533,857 525,524 -------- -------- -------- -------- Operating income 34,647 29,687 94,553 82,511 Interest expense 5,595 4,651 16,069 12,433 -------- -------- -------- -------- Earnings before income taxes 29,052 25,036 78,484 70,078 Income taxes 9,878 8,288 26,685 23,827 -------- -------- -------- -------- Net earnings $ 19,174 $ 16,748 $ 51,799 $ 46,251 ======== ======== ======== ======== Weighted average number of common shares outstanding: Basic 51,320 51,014 51,153 50,935 ======== ======== ======== ======== Diluted 52,131 51,330 51,859 51,265 ======== ======== ======== ======== Net earnings per common share: Basic $0.37 $0.33 $1.01 $0.91 ======== ======== ======== ======== Diluted $0.37 $0.33 $1.00 $0.90 ======== ======== ======== ======== Dividends per common share $0.1325 $0.1300 $0.3975 $0.3900 ======== ======== ======== ======== See accompanying notes to Consolidated Condensed Financial Statements.
-2- UNIVERSAL FOODS CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS ($000's Omitted) (Unaudited) Nine Months Ended June 30 ----------------- 1998 1997 ---- ---- Net cash provided by operating activities $ 56,378 $ 49,724 -------- -------- Cash flows from investing activities: Acquisition of property, plant and equipment (42,730) (51,348) Acquisition of new businesses (net of cash acquired) (47,281) (44,492) Other items, net (6,257) (5,509) -------- -------- Net cash used in investing activities (96,268) (101,349) -------- -------- Cash flows from financing activities: Proceeds from additional borrowings 67,152 69,253 Reduction in debt (1,595) (4,041) Purchase of treasury stock (14,090) -- Dividends (20,350) (19,863) Proceeds from options exercised 12,217 2,959 -------- -------- Net cash provided by financing activities 43,334 48,308 -------- -------- Net increase (decrease) in cash and cash equivalents 3,444 (3,317) Cash and cash equivalents at beginning of period 1,258 3,395 -------- -------- Cash and cash equivalents at end of period $ 4,702 $ 78 ======== ======== Supplemental disclosure of cash flow information: Cash paid during the period for: Interest $ 16,907 $ 11,826 Income taxes 20,265 15,259 See accompanying notes to Consolidated Condensed Financial Statements.
-3- UNIVERSAL FOODS CORPORATION NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS 1. In the opinion of the Company, the accompanying unaudited consolidated condensed financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of June 30, 1998 and September 30, 1997, the results of operations for the three and nine month periods ended June 30, 1998 and 1997 and cash flows for the nine month periods ended June 30, 1998 and 1997. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full fiscal year. 2. Refer to the footnotes in the Company's annual financial statements for the year ended September 30, 1997, for a description of the accounting policies, which have been continued without change (except as discussed in Note 7), and additional details of the Company's financial condition. The details in those notes have not changed except as a result of normal transactions in the interim. 3. Expenses are charged to operations in the year incurred. However, for interim reporting purposes, certain of these expenses are charged to operations based on an estimate rather than as actually incurred. 4. During the nine months ended June 30, 1998, the Company repurchased 736,391 shares of common stock for $14,967,000. 5. For the nine months ended June 30, 1998, depreciation and amortization were $28,667,000 and $4,490,000, respectively. For the nine months ended June 30, 1997, depreciation and amortization were $25,163,000 and $3,540,000, respectively. 6. On December 23, 1997, the Company issued a $30,000,000 senior note bearing interest at 7.06% due December 2002. Proceeds were used to refinance existing indebtedness and for general corporate purposes. 7. In 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128 (SFAS No. 128), "Earnings per Share." SFAS No. 128 replaced the previously reported primary and fully diluted earnings per share with basic and diluted earnings per share. Unlike primary earnings per share, basic earnings per share excludes any dilutive effects of options, warrants and convertible securities. Diluted earnings per share is very similar to the previously required fully diluted earnings per share. All earnings per share amounts for all periods have been presented, and where necessary, restated to conform to SFAS No. 128 requirements. The difference between basic and diluted earnings per share is the dilutive effect of employee stock options and restricted stock. -4- UNIVERSAL FOODS CORPORATION NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Continued) 8. On January 6, 1998, the Company announced that it acquired the stock of Arancia Ingredientes Especiales, S.A. de C.V., a manufacturer of savory flavors and other food ingredients for cash of approximately $24.8 million. With annual revenue of approximately $16 million, this acquisition further improves access to certain markets and creates opportunities for synergies with existing flavor operations in North America. The Company completed the acquisition of substantially all of the assets and business of Sundi GmbH, a German flavor manufacturer for cash of approximately $14 million on May 29, 1998. The acquired business has sales of approximately $15 million. Sundi's broad product line emphasizes all-natural flavor ingredients, an important factor for the German market. On April 29, 1998, the Company announced that it acquired DC Flavours Ltd., a manufacturer of savory flavors and seasonings for cash of approximately $7 million. Annual sales are less than $10 million. On an unaudited pro forma basis the acquisitions are not significant to the Company's 1998 results of operations. 9. On April 9, 1998, the Company declared a 2-for-1 stock split in the form of a 100% dividend. The new shares were distributed on May 22, 1998, to shareholders of record on May 6, 1998. All references in the financial statements to per share amounts and average number of shares have been restated for the stock split. 10. The Financial Accounting Standards Board has issued statements No. 130 "Reporting Comprehensive Income" and No. 131 "Disclosures about Segments of an Enterprise and Related Information." These statements will be effective for the Company in fiscal 1999. The Company is currently evaluating the impact of adopting these new pronouncements. 11. On June 25, 1998, the Board of Directors declared a dividend of one preferred share purchase right (a "Right") for each outstanding share of common stock, par value $0.10 per share, of the Company. The dividend was paid on August 6, 1998 to the stockholders of record on that date. Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Participating Cumulative Preferred Stock, without par value (the "Preferred Shares"), of the Company at a price of $125 per one one-thousandth of a Preferred Share (the "Purchase Price"), subject to adjustment. The Right becomes exercisable and tradeable ten days after a person or group acquires 20% or more, or makes an offer to acquire 20% or more, of the Company's outstanding common stock. When exercisable, each Right entitles the holder to purchase $250 worth of Company common stock for $125. Further, upon the occurrence of a merger or transfer of more than 50% of the Company's assets, the Right entitles the holder to purchase common stock of the Company or common stock of an "acquiring company" having a market value equivalent to two times the exercise price of the Right. At no time does the Right have any voting power. The Right is subject to redemption by the Company's Board of Directors for $.01 per Right at any time prior to the date which a person or group acquires beneficial ownership of 20% or more of the Company's common stock or subsequent thereto at the option of the Board of Directors. The Rights expire on September 30, 2008. The Rights replace the current common stock shareholder rights plan scheduled to expire on September 30, 1998. -5- MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS, FINANCIAL CONDITION AND FORWARD LOOKING INFORMATION RESULTS OF OPERATIONS: Revenue for the three and nine months ended June 30, 1998, was $214,506,000 and $628,410,000, respectively, compared to $209,725,000 and $608,035,000 a year ago. Revenue for the three and nine months ended June 30, 1998, increased by 2.3% and 3.4%, respectively, from the prior year periods. Continued domestic volume increases for the Dehydrated division and strong international revenue growth among the food and beverage categories in the Flavor division were partially offset by lower sales in the Color division due to a continued shift in production to more profitable product lines. Gross profit margins increased to 35.0% for the third quarter from 33.1% for the same period last year. Gross profit margin for the first nine months increased to 34.9% from 33.2% for the same period last year. The increase in the gross profit margin is attributable to a shift of sales to higher margin products in the Color division and lower raw material costs in the Red Star division. Selling and administrative expenses decreased slightly to 18.8% of revenue for the third quarter from 18.9% for the same period last year. For the first nine months of fiscal 1998, selling and administrative expenses increased to 19.9% of revenue from 19.6% last year. The change is due to increased goodwill amortization, market development activities in the Color, Red Star and Asia Pacific divisions offset by cost savings in the Flavor division. Interest expense for the third quarter increased to $5,595,000 from $4,651,000 for the same period last year and increased to $16,069,000 from $12,433,000 for the nine months ended June 30, 1998 and 1997, respectively. The increase is primarily the result of additional debt to finance acquisitions. FINANCIAL CONDITION: The current ratio decreased slightly to 1.8 at June 30, 1998, from 1.9 at September 30, 1997, due primarily to an increase in short-term borrowings to finance acquisitions. Net working capital decreased $5,309,000 to $158,412,000 at June 30, 1998, from $163,721,000 at September 30, 1997. Net cash provided by operating activities was $56,378,000 for the nine months ended June 30, 1998, compared to $49,724,000 for the nine months ended June 30, 1997. Higher earnings and improvements in asset management contributed to this increase. Net cash used in investing activities was $96,268,000 for the nine months ended June 30, 1998, compared to $101,349,000 for fiscal 1997. Included in investing activities are capital additions of $42,730,000 for the nine months ended June 30, 1998, and $51,348,000 for the nine months ended June 30, 1997. The capital expenditure program reflects the Company's continuing commitment to maintain and enhance product quality, further automate and upgrade manufacturing processes, and expand the business through internal growth. Net cash provided by financing activities was $43,334,000 and $48,308,000 for the nine months ended June 30, 1998 and 1997, respectively. In the current year, proceeds from additional borrowings of $67,152,000 were used primarily to fund capital expenditures, acquisitions and treasury stock purchases. Dividends of $20,350,000 and $19,863,000 were paid during the first nine months of fiscal 1998 and 1997, respectively. -6- MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS, FINANCIAL CONDITION AND FORWARD LOOKING INFORMATION (Continued) YEAR 2000: The "Year 2000" issue affects installed computer systems, network elements, software applications, and other business systems that have time sensitive programs that may not properly reflect or recognize the Year 2000. Because many computers and computer applications define dates by the last two digits of the year, "00" may not be properly identified as the Year 2000. This error could result in miscalculations or systems errors. The Year 2000 issue may also affect the systems and applications of customers and vendors. The Company has developed a comprehensive plan for addressing the Year 2000 issue. The plan includes the following steps and estimated completion dates: ESTIMATED COMPLETION STEPS DATE 1. Perform assessments of principal computer Substantially systems, network elements, software completed applications and other business systems and obtain third-party surveys to identify business critical, non-compliant systems. 2. Develop detailed action plans for non-compliant Substantially systems. completed 3. Implement the action plans. December 31, 1998 4. Perform testing of business critical systems. April 30, 1999 5. Develop Year 2000 rollover plan to address July 31, 1999 items such as systems back-up prior to rollover. 6. Develop Year 2000 contingency plans should key September 30, 1999 systems fail. As of June 30, 1998, the Company has substantially completed steps 1 and 2 and is beginning to implement the action plans. Throughout the process, the Company will receive outside independent feedback on whether business critical issues have been identified and whether the plan is on schedule. Based on the procedures performed through June 30, 1998, the Company believes all business critical systems will be Year 2000 compliant prior to April 30, 1999. Accordingly, the Company does not expect Year 2000 issues to have a material effect on the Company's results of operations, liquidity or financial condition. However, the Company is unable to determine the impact, if any, of third party non-compliance. Through June 30, 1998, the cost of modifying system software and engaging outside consultants has not been material. The Company estimates that through September 30, 1999 approximately 30% of its Information Technology personnel will be directed at Year 2000 issues. During Fiscal 1999 the Company estimates it will incur capital expenditures of approximately $10.0 million as a result of accelerating the rollout of computer operating systems and to replace non-compliant process control systems in various plants. -7- PART II OTHER INFORMATION Item 2. CHANGES IN SECURITIES The Company adopted a new Shareholder Rights Plan on August 6, 1998, that replaces its current rights plan scheduled to expire on September 30, 1998. The terms of the proposed plan are substantially similar to the terms of the Company's existing plan, except that the new plan grants holders the right to purchase one one-thousandth of a share of a newly designated series of the Company's Cumulative Preferred Stock instead of one share of Common Stock. The principal effect of this change to the plan is to eliminate the need to reserve authorized but unissued common shares in order to meet stock exchange listing requirements and thereby retain the availability of authorized but unissued common shares for other business purposes. A copy of the new Shareholder Rights Plan has been filed with the Securities and Exchange Commission as an Exhibit to a Registration Statement on Form 8-A dated July 20, 1998, which is hereby incorporated herein by reference. -8- Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits. (See Exhibit Index on the last page of this report.) (b) A report on Form 8-K, dated April 10, 1998, was filed in connection with the Company's two-for-one stock split. A report on Form 8-K, dated June 26, 1998, was filed in connection with the adoption of the Share Purchase Rights Plan which replaces the Company's Shareholders' Rights Plan which was to expire on September 30, 1998. -9- 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. UNIVERSAL FOODS CORPORATION Date: August 13, 1998 By: /s/ John L. Hammond ------------------------------------------- John L. Hammond, Vice President, Secretary and General Counsel Date: August 13, 1998 By: /s/ Michael L. Hennen ------------------------------------------- Michael L. Hennen, Corporate Controller -10- UNIVERSAL FOODS CORPORATION EXHIBIT INDEX 1998 QUARTER 3 FORM 10-Q Incorporated Herein by Exhibit Reference Filed Number Description from Herewith - ------- -------------------------------------- -------------- -------- 3.3 Resolution of the Board of Directors adopted on June 25, 1998 amending the Articles of Incorporation (accompanied X by a complete copy of the Articles of Incorporation, as amended) 4 Shareholder Rights Plan Previously filed on Form 8-A dated July 20, 1998 27.1 Financial Data Schedule 1998 Quarter 3 X 27.2 Financial Data Schedule - Restated 1997 X 3-MOS, 6-MOS, 9-MOS, AND 12-MOS 27.3 Financial Data Schedule - Restated 1996 X 3-MOS, 6-MOS, 9-MOS, AND 12-MOS 27.4 Financial Data Schedule - Restated 1995 X 12-MOS -11- EX-3.3 2 RESOLUTION ADOPTED BY THE BOARD OF DIRECTORS OF UNIVERSAL FOODS CORPORATION ON JUNE 25, 1998 RESOLVED FURTHER, that the Articles of Incorporation are hereby amended as follows: 1. Subsection 3.1.2 of the Corporation's Articles of Incorporation is amended by replacing the period following the word "Stock" in the second line of said Subsection with a comma, and by adding the following language to the end of said Subsection: "of which 100,000 shares are designated as Series A Participating Cumulative Preferred Stock pursuant to Section 4.7 hereof." 2. Section 4.7 Corporation's Articles of Incorporation is created to read as follows: Section 4.7. Series A Participating Cumulative Preferred Stock: Subsection 4.7.1. Designation and Amount. The shares of such series shall be designated as "Series A Participating Cumulative Preferred Stock" (the "Series A Preferred Stock") and the number of shares constituting the Series A Preferred Stock shall be 100,000. Such number of shares may be increased or decreased by resolution of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series A Preferred Stock. Subsection 4.7.2. Dividends and Distributions. (A) Subject to the rights of the holders of any shares of any series of Preferred Stock (or any similar stock) ranking pari passu with the Series A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock, in preference to the holders of Common Stock, par value $0.10 per share ("Common Shares"), of the Corporation, and of any other junior stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the first day of December, March, June and September in each year (each such date being referred to in this Section 4.7 as a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $1 or (b) subject to the provision for adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in Common Shares or a subdivision of the outstanding Common Shares (by reclassification or otherwise), declared on the Common Shares since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Preferred Stock. In the event the Corporation shall at any time declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or combination or consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. (B) Dividends shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof. Subsection 4.7.3. Voting Rights. The holders of shares of Series A Preferred Stock shall have the following voting rights: (A) Subject to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof to one vote on all matters submitted to a vote of the stockholders of the Corporation. (B) Except as otherwise provided in these Articles of Incorporation, in any other Resolution of the Board of Directors creating a series of Preferred Stock or any similar stock, or by law, the holders of shares of Series A Preferred Stock and the holders of Common Shares and any other capital stock of the Corporation having general voting rights shall vote together as one class on all matters submitted to a vote of stockholders of the Corporation. (C) Except as set forth in these Articles of Incorporation or as otherwise provided by law, holders of Series A Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Shares as set forth herein) for taking any corporate action. Subsection 4.7.4. Certain Restrictions. (A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock outstanding shall have been paid in full, the Corporation shall not: (i) declare or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock; (ii) declare or pay dividends, or make any other distributions, on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the Series A Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled; (iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock, provided that the Corporation may at any time redeem, purchase or otherwise acquire shares of any such junior stock in exchange for shares of any stock of the Corporation ranking junior (either as to dividends or upon dissolution, liquidation or winding up) to the Series A Preferred Stock; or (iv) redeem or purchase or otherwise acquire for consideration any shares of Series A Preferred Stock, or any shares of stock ranking on a parity with the Series A Preferred Stock, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Directors) to all holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective Series And classes, shall determine in good faith will result in fair and equitable treatment among the respective series or classes. (B) The Corporation shall not permit any subsidiary of the Corporation to purchase or otherwise acquire for consideration any shares of stock of the Corporation unless the Corporation could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner. Subsection 4.7.5. Reacquired Shares. Any shares of Series A Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock subject to the conditions and restrictions on issuance set forth in these Articles of Incorporation or in any other Resolution of the Board of Directors creating a series of Preferred Stock or any similar stock or as otherwise required by law. Subsection 4.7.6. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Corporation, no distribution shall be made (1) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received $250 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment, provided that the holders of shares of Series A Preferred Stock shall be entitled to receive an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount to be distributed per share to holders of Common Shares, or (2) to the holders of shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except distributions made ratably on the Series A Preferred Stock and all such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up. In the event the Corporation shall at any time declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or combination or consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the aggregate amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under the proviso in clause (1) of the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. Subsection 4.7.7. Consolidation, Merger, etc. In case the Corporation shall enter into any consolidation, merger, combination or other transaction in which the Common Shares are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or changed into an amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each Common Share is changed or exchanged. In the event the Corporation shall at any time declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or combination or consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. Subsection 4.7.8. No Redemption. The shares of Series A Preferred Stock shall not be redeemable. Subsection 4.7.9. Rank. The Series A Preferred Stock shall be of equal rank, with respect to the payment of dividends and the distribution of assets, to all series of any other class of the Corporation's Cumulative Preferred Stock. Subsection 4.7.10. Amendment. These Articles of Incorporation shall not be amended in any manner which would materially alter or change the powers, preferences or special rights of the Series A Preferred Stock so as to affect them adversely without the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series A Preferred Stock, voting together as a single class. In addition to the rights, preferences and privileges accorded to the Series A Preferred Stock in this Section 4.7, the Series A Preferred Stock shall have the rights, privileges and preferences, and be subject to the limitations, accorded generally to the Cumulative Preferred Stock in the foregoing Sections 4.1 through 4.6. (As amended through 6/25/98) UNIVERSAL FOODS CORPORATION RESTATED ARTICLES OF INCORPORATION These Amended and Restated Articles of Incorporation, duly adopted pursuant to Chapter 180 of the Wisconsin Statutes, supersede and take the place of the existing Articles of Incorporation and all amendments thereto. ARTICLE I. Name. SECTION 1.1. Name. The name of the corporation is UNIVERSAL FOODS CORPORATION. ARTICLE II. Purposes. SECTION 2.1. Purposes. The purposes for which the corporation is organized are to engage in any lawful activity within the purposes for which corporations may be organized under the Wisconsin Business Corporation Law. ARTICLE III. Capital Stock. Section 3.1. Number of Shares and Classes. The aggregate number of shares which the corporation has authority to issue is 100,250,000 divided into the following classes: Subsection 3.1.1. Common Stock. 100,000,000 shares at the par value of $0.10 per share designated as "Common Stock." Subsection 3.1.2. Cumulative Preferred Stock. 250,000 shares without par value designated as "Cumulative Preferred Stock," of which 100,000 shares are designated as Series A Participating Cumulative Preferred Stock pursuant to Section 4.7 hereof. ARTICLE IV. Preferences, Limitation and Relative Rights of Cumulative Preferred Stock SECTION 4.1. Dividends and Distributions on Cumulative Preferred Stock. Subsection 4.1.1. The holders of Cumulative Preferred Stock of all series shall be entitled to receive dividends at such rates, upon such conditions and at such times as shall be stated in the resolution or resolutions of the Board of Directors providing for the issuance thereof and not inconsistent with the provisions hereof. Subsection 4.1.2. No dividend or other distribution, except a dividend payable solely in Common Stock, shall be paid on Common Stock, and no shares of Common Stock shall be purchased, redeemed or otherwise acquired by the corporation for a consideration, otherwise than in exchange for or through application of the proceeds of the sale of other Common Stock, if the payment of such dividend or distribution on Common Stock, or the making of any such purchase, redemption or other acquisition of Common Stock, will result in reducing the Consolidated Net Worth of the corporation below 150% of the aggregate involuntary liquidation amounts of all outstanding shares of Cumulative Preferred Stock. Subsection 4.1.3. All dividends on Cumulative Preferred Stock shall be without priority as between series, shall be paid out of net earnings or any surplus properly applicable to the payment thereof, shall be cumulative and shall be paid or set apart before any dividends or other distributions shall be paid or set apart for Common Stock, provided, however, that dividends may be declared and paid on Common Stock in Common Stock of the corporation. Any dividends paid upon the Cumulative Preferred Stock in an amount less than full cumulative dividends accrued and in arrears upon all Cumulative Preferred Stock outstanding shall, if more than one series be outstanding, be distributed among the different series in proportion to the aggregate amounts which would be distributable to the Cumulative Preferred Stock of each series if full cumulative dividends were declared and paid thereon. Subsection 4.1.4. The Cumulative Preferred Stock shall entitle the holder thereof to receive, out of net profits of the corporation or out of any surplus applicable to the payment of such dividends in each fiscal year as declared at any time by the Board of Directors, dividends at the rate fixed in the resolution or resolutions adopted by the Board of Directors pursuant to which the issuance of such Cumulative Preferred Stock shall be authorized. The dividends on the Cumulative Preferred Stock shall be cumulative, so that if at any time the full amount of dividends accrued and in arrears on the Cumulative Preferred Stock shall not be paid, the deficiency shall be payable before any dividends or other distributions shall be paid or set apart on the Common Stock, and before any sums shall be paid or set apart for the redemption of less than all of the Cumulative Preferred Stock then outstanding. Dividends on Cumulative Preferred Stock shall accrue from date of issue. Whenever all dividends accrued and in arrears on Cumulative Preferred Stock shall have been declared and shall have been paid or set apart, the Board of Directors may declare dividends on Common Stock out of the remaining net profits of the corporation, or out of surplus applicable to the payment of such dividends, subject to the restriction set forth in Subsection 4.1.2 hereof. SECTION 4.2. Issuance of Preferred Stock. Subsection 4.2.1. No stock having preference or priority in rights or security over the Cumulative Preferred Stock may be issued unless first approved by the affirmative vote of such majority of the Cumulative Preferred Stock then outstanding as then required by law. Subsection 4.2.2. No Cumulative Preferred Stock shall be issued which, after giving effect to such issuance, would result in the aggregate involuntary liquidation amount of all outstanding shares of Cumulative Preferred Stock exceeding 66-2/3% of Consolidated Net Worth of the corporation. SECTION 4.3. Rights of Holders of Cumulative Preferred Stock on Liquidation. In the event of the voluntary liquidation or winding up of the corporation, the holders of Cumulative Preferred Stock shall be entitled to receive in full the fixed voluntary liquidation amount thereof plus accrued dividends thereon, all as provided in the resolution or resolutions providing for the issuance thereof, and no more, before any amount shall be paid to the holders of Common Stock. In the event of the involuntary liquidation of the corporation, the holders of the Cumulative Preferred Stock shall be entitled to receive in full the fixed involuntary liquidation amount thereof, plus accrued dividends thereon, all as provided in the resolution or resolutions providing for the issuance thereof, and no more, before any amount shall be paid to the holders of Common Stock. The holders of all series of Cumulative Preferred Stock shall be entitled to receive all amounts described in the preceding provisions of this Section 4.3 out of the assets of the corporation, whether from capital, surplus or earnings. As used in this Section 4.3 "accrued dividends" means, in respect to each share of Cumulative Preferred Stock, an amount equal to the fixed dividend rate per annum for each share (without interest thereon), from the date from which cumulative dividends commenced to accrue in respect of such share to the date as of which the computation is to be made, less the aggregate amount (without interest) of all dividends paid thereon or declared and set aside for payment in respect thereof, whether or not any such dividends shall have been earned. If, upon any such voluntary or involuntary liquidation, the assets of the corporation distributable as aforesaid among the holders of the Cumulative Preferred Stock shall be insufficient to permit payment to them of the full preferential amounts aforesaid, then the entire assets of the corporation available for distribution to shareholders shall be distributed ratably among the holders of Cumulative Preferred Stock in proportion to the full preferential amounts to which they are respectively entitled. The holders of Cumulative Preferred Stock shall not otherwise be entitled to participate in any distribution of assets of the corporation which shall be divided and distributed among the holders of Common Stock according to their respective rights and preferences. No consolidation or merger of the corporation with or into another corporation or corporations and no sale by the corporation of all or substantially all of its assets shall be deemed a liquidation or winding up of the corporation within the meaning of this Section 4.3. SECTION 4.4. Voting Rights of Cumulative Preferred Stock. The holders of the Cumulative Preferred Stock shall, together with the holders of Common Stock (neither the Cumulative Preferred Stock nor the Common Stock voting as a class), possess full voting rights for the election of directors and for other purposes, and for such purposes the holders of Cumulative Preferred Stock shall, subject to the provisions of the Bylaws of the corporation and of the Wisconsin Business Corporation Law relative to the fixing of the record date, be entitled to one vote for each share held by them respectively. SECTION 4.5. Directors' Authority to Establish Series of Cumulative Preferred Stock. The Cumulative Preferred Stock may be issued in series from time to time, with such designations, preferences and other rights, qualifications, limitations or restrictions thereof as shall be stated and expressed in the resolution or resolutions providing for the issuance of such series and adopted by the Board of Directors pursuant to the authority hereby given as provided by the Wisconsin Business Corporation Law and not inconsistent with the provisions hereof. Without limiting the authority granted to the Board of Directors in this Section, each series shall have such (a) rate of dividend; (b) price at and terms and conditions on which shares may be redeemed; (c) amount payable upon shares in event of voluntary or involuntary liquidation; (d) sinking fund provisions for the redemption or purchase of shares; and (e) terms and conditions on which shares may be converted, if the shares of any series are issued with the privilege of conversion; as shall be stated or expressed in the resolution or resolutions of the Board of Directors providing for the issuance thereof. SECTION 4.6. Definitions. Subsection 4.6.1. The term "Consolidated Net Worth" of the corporation shall mean the Consolidated Net Worth of the corporation and all of its subsidiaries determined on a consolidated basis in accordance with generally accepted accounting principles. Subsection 4.6.2. The term "Subsidiary" shall mean any corporation or association of which not less than a majority of the capital stock or shares (having the power in all events to vote for the election of directors or trustees) is owned and controlled by the corporation either directly or through another Subsidiary. SECTION 4.7. Series A Participating Cumulative Preferred Stock: Subsection 4.7.1. Designation and Amount. The shares of such series shall be designated as "Series A Participating Cumulative Preferred Stock" (the "Series A Preferred Stock") and the number of shares constituting the Series A Preferred Stock shall be 100,000. Such number of shares may be increased or decreased by resolution of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series A Preferred Stock. Subsection 4.7.2. Dividends and Distributions. (A) Subject to the rights of the holders of any shares of any series of Preferred Stock (or any similar stock) ranking pari passu with the Series A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock, in preference to the holders of Common Stock, par value $0.10 per share ("Common Shares"), of the Corporation, and of any other junior stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the first day of December, March, June and September in each year (each such date being referred to in this Section 4.7 as a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $1 or (b) subject to the provision for adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in Common Shares or a subdivision of the outstanding Common Shares (by reclassification or otherwise), declared on the Common Shares since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Preferred Stock. In the event the Corporation shall at any time declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or combination or consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. (B) Dividends shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share- by-share basis among all such shares at the time outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof. Subsection 4.7.3. Voting Rights. The holders of shares of Series A Preferred Stock shall have the following voting rights: (A) Subject to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof to one vote on all matters submitted to a vote of the stockholders of the Corporation. (B) Except as otherwise provided in these Articles of Incorporation, in any other Resolution of the Board of Directors creating a series of Preferred Stock or any similar stock, or by law, the holders of shares of Series A Preferred Stock and the holders of Common Shares and any other capital stock of the Corporation having general voting rights shall vote together as one class on all matters submitted to a vote of stockholders of the Corporation. (C) Except as set forth in these Articles of Incorporation or as otherwise provided by law, holders of Series A Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Shares as set forth herein) for taking any corporate action. Subsection 4.7.4. Certain Restrictions. (A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock outstanding shall have been paid in full, the Corporation shall not: (i) declare or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock; (ii) declare or pay dividends, or make any other distributions, on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the Series A Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled; (iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock, provided that the Corporation may at any time redeem, purchase or otherwise acquire shares of any such junior stock in exchange for shares of any stock of the Corporation ranking junior (either as to dividends or upon dissolution, liquidation or winding up) to the Series A Preferred Stock; or (iv) redeem or purchase or otherwise acquire for consideration any shares of Series A Preferred Stock, or any shares of stock ranking on a parity with the Series A Preferred Stock, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Directors) to all holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective Series And classes, shall determine in good faith will result in fair and equitable treatment among the respective series or classes. (B) The Corporation shall not permit any subsidiary of the Corporation to purchase or otherwise acquire for consideration any shares of stock of the Corporation unless the Corporation could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner. Subsection 4.7.5. Reacquired Shares. Any shares of Series A Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock subject to the conditions and restrictions on issuance set forth in these Articles of Incorporation or in any other Resolution of the Board of Directors creating a series of Preferred Stock or any similar stock or as otherwise required by law. Subsection 4.7.6. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Corporation, no distribution shall be made (1) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received $250 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment, provided that the holders of shares of Series A Preferred Stock shall be entitled to receive an aggregate amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount to be distributed per share to holders of Common Shares, or (2) to the holders of shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except distributions made ratably on the Series A Preferred Stock and all such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up. In the event the Corporation shall at any time declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or combination or consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the aggregate amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under the proviso in clause (1) of the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. Subsection 4.7.7. Consolidation, Merger, etc. In case the Corporation shall enter into any consolidation, merger, combination or other transaction in which the Common Shares are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or changed into an amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each Common Share is changed or exchanged. In the event the Corporation shall at any time declare or pay any dividend on the Common Shares payable in Common Shares, or effect a subdivision or combination or consolidation of the outstanding Common Shares (by reclassification or otherwise than by payment of a dividend in Common Shares) into a greater or lesser number of Common Shares, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. Subsection 4.7.8. No Redemption. The shares of Series A Preferred Stock shall not be redeemable. Subsection 4.7.9. Rank. The Series A Preferred Stock shall be of equal rank, with respect to the payment of dividends and the distribution of assets, to all series of any other class of the Corporation's Cumulative Preferred Stock. Subsection 4.7.10. Amendment. These Articles of Incorporation shall not be amended in any manner which would materially alter or change the powers, preferences or special rights of the Series A Preferred Stock so as to affect them adversely without the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series A Preferred Stock, voting together as a single class. In addition to the rights, preferences and privileges accorded to the Series A Preferred Stock in this Section 4.7, the Series A Preferred Stock shall have the rights, privileges and preferences, and be subject to the limitations, accorded generally to the Cumulative Preferred Stock in the foregoing Sections 4.1 through 4.6. ARTICLE V. Pre-emptive Rights. SECTION 5.1. Pre-emptive Rights. No holder of any class of stock of the corporation shall, because of his ownership of said stock, have any pre-emptive or other right to purchase, or subscribe for, or take any part of any class of stock, or any part of the notes, debentures, bonds or other securities convertible into or carrying options or warrants to purchase any class of stock of this corporation. ARTICLE VI. Registered Office; Registered Agent. SECTION 6.1 Registered Office; Registered Agent. The address of the registered office of the corporation is 433 East Michigan Street, Milwaukee, Wisconsin 53202, and the registered agent at the registered office of the corporation is Terrence M. O'Reilly. ARTICLE VII. Directors; Removal of Directors. SECTION 7.1. Directors. The number of directors constituting the Board of Directors of the corporation shall be fixed from time to time by the Bylaws of the corporation. The Board of Directors of the corporation shall be divided into three (3) classes. The term of office of the first class of directors shall expire at the first annual meeting after their election, the term of office of the second class shall expire at the second annual meeting after their election and that of the third class shall expire at the third annual meeting after their election. At each annual meeting after classification of the Board of Directors, the class of directors whose term expires at the time of such election shall be elected to hold office until the third succeeding annual meeting. The number of directors in each class shall be as fixed from time to time in the Bylaws. SECTION 7.2 Removal of Directors. A director may be removed from office by affirmative vote of two thirds (2/3) of the outstanding shares entitled to vote for the election of such director, taken at a meeting of shareholders called for that purpose, and any vacancy so created may be filled by such shareholders. ARTICLE VIII. Acquisition of Shares. SECTION 8.1 Acquisition of Shares. The corporation is authorized by action of the Board of Directors without consent of shareholders to purchase, take, receive or otherwise acquire shares of the corporation subject to the provisions of Section 180.0640(3) of the Wisconsin Statutes and Section 4.1.2 hereof. ARTICLE IX. Distributions. SECTION 9.1 Distributions. The Board of Directors may from time to time distribute to shareholders in partial liquidation out of stated capital or net capital surplus of the corporation, a portion of its assets, in cash or property. ARTICLE X. Repurchase of Common Stock. SECTION 10.1 Repurchase Rights. Subsection 10.1.1. In the event that any person (Acquiring Person) (i) who is the beneficial owner, directly or indirectly, of more than fifty percent of the Common Stock outstanding becomes the beneficial owner, directly or indirectly, of any additional Common Stock pursuant to a tender offer or (ii) becomes the beneficial owner, directly or indirectly, of more than fifty percent of the Common Stock outstanding and any of such Common Stock was acquired pursuant to a tender offer, each holder of Common Stock, other than the Acquiring Person or a transferee of the Acquiring Person, shall have the right until and including the thirtieth day following the date the notice to holders of Common Stock referred to in Section 10.3 herein is mailed to have the Common Stock held by such holder repurchased by the corporation at the Repurchase Price determined as provided in Section 10.5 herein, and each holder of securities convertible into Common Stock or of options, warrants, or rights exercisable to acquire Common Stock prior to such thirtieth day, other than the Acquiring Person or a transferee of the Acquiring Person, shall have the right simultaneously with the conversion of such securities or exercise of such options, warrants, or rights to have the Common Stock to be received thereupon by such holder repurchased by corporation at the Repurchase Price. Subsection 10.1.2. All repurchase rights hereunder shall be subject to, and limited by, any provision contained in the Wisconsin Statutes, in Article 4 hereof, or in any loan agreement entered into at any time by the corporation, which limits the amounts which may be used by the corporation to repurchase Common Stock of the corporation. Subsection 10.1.3. No holder of Common Stock of the corporation shall have any right to have Common Stock repurchased by the corporation pursuant to this Article 10 if the corporation, acting through a majority of its Board of Directors, shall within ten (10) days following the announcement or publication of such tender offer or following any amendment of such tender offer recommend to the holders of Common Stock that such tender offer be accepted. SECTION 10.2 Definitions. Subsection 10.2.1. The term "person" shall include an individual, a corporation, partnership, trust or other entity. When two or more persons act as a partnership, limited partnership, syndicate, or other group for the purpose of acquiring Common Stock, such partnership, syndicate or group shall be deemed a "person". Subsection 10.2.2. For the purpose of determining whether a person is an Acquiring Person, such person shall be deemed to beneficially own (i) all Common Stock with respect to which such person has the capability to control or influence the voting power in respect thereof and (ii) all Common Stock which such person has the immediate or future right to acquire, directly or indirectly, pursuant to agreements, through the exercise of options, warrants or rights or through the conversion of convertible securities or otherwise; and all Common Stock which such person has the right to acquire in such manner shall be deemed to be outstanding shares, but Common Stock which any other person has the right to acquire in such manner shall not be deemed to be outstanding shares. Subsection 10.2.3. The acquisition of Common Stock by the corporation or by any person controlled by the corporation shall not engender the right to have Common Stock repurchased pursuant to this Article. Subsection 10.2.4. The right to have Common Stock repurchased pursuant to this Article shall attach to such shares and shall not be personal to the holder thereof. Subsection 10.2.5. The term "tender offer" shall mean an offer to acquire or an acquisition of Common Stock pursuant to a request or invitation for tenders or an offer to purchase such shares for cash, securities or any other consideration. Subsection 10.2.6. The term "market purchases" shall mean the acquisition of Common Stock from holders of such shares in privately negotiatied transactions or in transactions effected through a broker or deal. Subsection 10.2.7. Subject to the provisions of Section 10.2.2 herein, "outstanding shares" shall mean shares of Common Stock which at the time in question have been issued by the corporation and not reacquired and held or retired by it or held by any subsidiary of the corporation. SECTION 10.3 Repurchase Procedure. Not later than thirty (30) days following the date on which the corporation receives credible notice that any person has become an Acquiring Person whereupon the right shall be engendered to have Common Stock repurchased by the corporation under this Article 10, the corporation shall give written notice, by first class mail, postage prepaid, at the address shown on the records of the corporation, to each holder of record of Common Stock (and to any other person known by the corporation to have rights to demand repurchase pursuant to Section 10.1 of this Article) as of a date not more than seven (7) days prior to the date of the mailing pursuant to this Section 10.3 and shall advise each such holder of the right to have shares repurchased and the procedures for such repurchase. In the event that the corporation fails to give notice as required by this Section 10.3, any holder entitled to receive such notice may within thirty (30) days thereafter serve written demand upon the corporation to give such notice. If within thirty (30) days after the receipt of written demand the corporation fails to give the required notice, such holder may at the expense and on behalf of the corporation take such reasonable action as may be appropriate to give notice or to cause notice to be given pursuant to this Section 10.3. Subsection 10.3.1. In the event Common Stock are subject to repurchase in accordance with this Article 10, the directors of the corporation shall designate a Repurchase Agent, which shall be a corporation or association (i) organized and doing business under the laws of the United States or any State, (ii) subject to supervision or examination by Federal or State authority, (iii) having combined capital and surplus of at least $5,000,000 and (iv) having the power to exercise corporate trust powers. Subsection 10.3.2. For a period of ninety days from the date of the mailing of the notice to holders of Common Stock referred to in this Section l0.3, holders of Common Stock and other persons entitled to have Common Stock repurchased pursuant to this Article l0 may, at their option, deposit certificates representing all or less than all Common Stock held of record by them with the Repurchase Agent together with written notice that the holder elects to have such shares repurchased pursuant to this Article 10. Repurchase shall be deemed to have been effected at the close of business on the day such certificates are deposited in proper form with the Repurchase Agent. Subsection 10.3.3. The corporation shall promptly deposit in trust with the Repurchase Agent cash in an amount equal to the aggregate Repurchase Price of all of the Common Stock deposited with the Repurchase Agent for purposes of repurchase. Subsection 10.3.4. As soon as practicable after receipt by the Repurchase Agent of the cash deposit by the corporation referred to in this Section 10.3, the Repurchase Agent shall issue its checks payable to the order of the persons entitled to receive the Repurchase Price of the Common Stock in respect of which such cash deposit was made. Subsection 10.3.5 In the event the corporation is unable to deposit with the Repurchase Agent cash in the full amount of the aggregate Repurchase Price of all shares deposited for repurchase, because of limitations upon repurchase of Common Stock contained in the Wisconsin Statutes, in Article 4 hereof, or in any loan agreement entered into at any time by the corporation, the corporation shall promptly deposit with the Repurchase Agent the maximum amount of cash which may be used for the repurchase of Common Stock, under the most restrictive of the applicable limitations upon such repurchase. In the event of deposit of less than the full aggregate Repurchase Price pursuant to the provisions of this subsection, the Repurchase Agent shall use the amount so deposited to repurchase the deposited shares pro tanto, in proportion to the number of shares deposited by each shareholder for repurchase. Certificates representing all shares which remain unpurchased shall be returned to the depositors thereof as soon as practicable thereafter, and there shall be no further repurchase rights with respect to such shares arising in connection with the transactions already completed. SECTION 10.4. Retired Stock. All Common Stock with respect to which repurchase has been effected pursuant to this Article 10 shall thereupon be deemed retired. SECTION 10.5. Repurchase Price. (a) The Repurchase Price shall be the amount payable by the corporation in respect of each share of Common Stock with respect to which repurchase has been demanded pursuant to this Article 10 and shall be the greatest amount determined on any of the following three bases: (i) The highest price per share of Common Stock, including any commission paid to brokers or dealers for solicitation or whatever, at which Common Stock held by the Acquiring Person were acquired pursuant to a tender offer regardless of when such tender offer was made or were acquired pursuant to any market purchase or otherwise within eighteen months prior to the notice to holders of Common Stock referred to in Section 3 herein. For purposes of this subsection (i), if the consideration paid in any such acquisition of Common Stock consisted, in whole or part, of consideration other than cash, the Board of Directors of the corporation shall take such action, as in its judgment it deems appropriate, to establish the cash value of such consideration, but such valuation shall not be less than the cash value, if any, ascribed to such consideration by the Acquiring Person. (ii) The highest sale price per share of Common Stock for any trading day during the eighteen months prior to the notice to holders of Common Stock referred to in Section l0.3 herein. For purposes of this subsection (ii), the sale price for any trading day shall be the last sale price per share of Common Stock traded on the New York Stock Exchange or other national securities exchange, or, if Common Stock of the corporation is not then traded on a national securities exchange, the mean of the closing bid and asked price per share of Common Stock. (iii) The amount of shareholders' equity in respect of each outstanding share of Common Stock as determined in accordance with generally accepted accounting principles and as reflected in any published report by the corporation as at the fiscal year quarter ending immediately preceding the notice to shareholders referred to in Section 10.3 herein. Subsection 10.5.1. The determinations to be made pursuant to Section 10.5 shall be made by the Board of Directors not later than the date of the notice to holders of Common Stock referred to in Section 10.3 herein. In making such determination the Board of Directors may engage such persons, including investment banking firms and the independent accountants, who have reported on the most recent financial statements of the corporation, and utilize employees and agents of the corporation, who will, in the judgment of the Board of Directors, be of assistance to the Board of Directors. Subsection 10.5.2. The determinations to be made pursuant to this Section 10.5, when made by the Board of Directors acting in good faith on the basis of such information and assistance as was then reasonably available for such purpose, shall be conclusive and binding upon the corporation and its shareholders, including any person referred to in Section 10.1 herein. EX-27.1 3
5 1,000 9-MOS SEP-30-1998 OCT-1-1997 JUN-30-1998 4,702 0 125,794 4,055 184,264 354,753 597,939 257,232 954,051 196,341 282,479 0 0 5,396 395,129 954,051 628,410 628,410 409,093 409,093 0 666 16,069 78,484 26,685 51,799 0 0 0 51,799 1.01 1.00
EX-27.2 4
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE ACCOMPANYING FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1000 12-MOS 9-MOS 6-MOS 3-MOS SEP-30-1997 SEP-30-1997 SEP-30-1997 SEP-30-1997 OCT-01-1996 OCT-01-1996 OCT-01-1996 OCT-01-1996 SEP-30-1997 JUN-30-1997 MAR-31-1997 DEC-31-1996 1,258 78 5,840 6,726 0 0 0 0 121,293 116,547 114,450 105,747 4,034 3,866 3,633 3,640 185,552 175,480 176,815 184,701 342,248 330,806 334,154 328,610 536,061 520,822 502,096 494,129 227,082 227,460 219,937 219,501 887,729 852,527 843,017 789,593 178,527 144,044 142,809 150,903 252,526 264,741 264,359 208,887 0 0 0 0 0 0 0 0 2,698 2,698 2,698 2,698 377,753 369,564 360,481 357,121 887,729 852,527 843,017 789,593 825,714 608,035 398,310 193,484 825,714 608,035 398,310 193,484 551,090 406,206 265,891 127,632 551,090 406,206 265,891 127,632 0 0 0 0 572 461 155 242 16,798 12,433 7,782 3,687 90,436 70,078 45,042 21,196 25,748 23,827 15,539 7,313 64,688 46,251 29,503 13,883 0 0 0 0 0 0 0 0 0 0 0 0 64,688 46,251 29,503 13,883 1.27 .91 .58 .27 1.26 .90 .58 .27 THIS STATEMENT HAS BEEN RESTATED AS A RESULT OF SFAS NO. 128, "EARNINGS PER SHARE", AND A STOCK SPLIT THAT OCCURRED IN THE QUARTER ENDED JUNE 30 1998.
EX-27.3 5
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE ACCOMPANYING FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1000 12-MOS 9-MOS 6-MOS 3-MOS SEP-30-1996 SEP-30-1996 SEP-30-1996 SEP-30-1996 OCT-01-1995 OCT-01-1995 OCT-01-1995 OCT-01-1995 SEP-30-1996 JUN-30-1996 MAR-31-1996 DEC-31-1995 3,395 4,722 3,539 6,844 0 0 0 0 109,359 110,698 107,900 101,098 3,509 3,173 3,090 3,032 174,193 164,354 169,884 177,308 324,604 318,342 319,651 315,936 479,765 477,571 464,785 455,855 211,304 208,059 201,160 194,698 780,472 782,822 775,944 766,899 162,152 154,973 148,583 159,805 196,869 193,342 193,906 169,695 0 0 0 0 0 0 0 0 2,698 2,698 2,698 2,698 348,268 358,993 358,032 362,159 780,472 782,822 775,944 766,899 806,352 594,256 393,480 193,446 806,352 594,256 393,480 193,446 533,260 391,593 258,665 126,467 533,260 515,491 258,665 126,467 25,000 0 0 0 349 120 (110) (237) 15,266 11,452 7,381 3,906 68,640 67,313 46,461 21,078 24,435 23,560 15,429 7,588 44,205 43,753 28,032 13,490 0 0 0 0 0 0 0 0 0 0 0 0 44,205 43,753 28,032 13,490 .86 .84 .54 .26 .85 .84 .53 .26 UNUSUAL ITEM: INCLUDES CHARGES OF $20 MILLION RELATING TO ADOPTING SFAS NO. 121 AND $5 MILLION FOR RESTRUCTURING COSTS. THIS STATEMENT HAS BEEN RESTATED AS A RESULT OF SFAS NO. 128, "EARNINGS PER SHARE", AND A STOCK SPLIT THAT OCCURRED IN THE QUARTER ENDED JUNE 30, 1998.
EX-27.4 6
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE ACCOMPANYING FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1000 YEAR SEP-30-1995 OCT-01-1994 SEP-30-1995 8,717 0 109,615 3,768 179,020 326,364 447,381 187,693 776,870 182,600 160,678 0 0 2,698 359,082 776,870 792,971 792,971 518,194 518,194 (26,847) 1,356 15,107 114,603 48,500 66,103 0 0 0 66,103 1.27 1.26 UNUSUAL ITEM: INCLUDED THE GAIN ON THE SALE OF THE FROZEN FOODS BUSINESS OFFSET BY THE COSTS OF DISCONTINUING A PRODUCT LINE AND OTHER ITEMS WHICH INCLUDE THE COST OF A PATENT INFRINGEMENT JUDGEMENT AND WRITE-DOWN OF INTANGIBLE ASSETS. THIS STATEMENT HAS BEEN RESTATED AS A RESULT OF SFAS NO. 128, "EARNINGS PER SHARE", AND A STOCK SPLIT THAT OCCURRED IN THE QUARTER ENDED JUNE 30, 1998.
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