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<SEC-DOCUMENT>0000950137-04-002276.txt : 20040329
<SEC-HEADER>0000950137-04-002276.hdr.sgml : 20040329
<ACCEPTANCE-DATETIME>20040329090439
ACCESSION NUMBER:		0000950137-04-002276
CONFORMED SUBMISSION TYPE:	10-K
PUBLIC DOCUMENT COUNT:		9
CONFORMED PERIOD OF REPORT:	20031231
FILED AS OF DATE:		20040329

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CHICAGO RIVET & MACHINE CO
		CENTRAL INDEX KEY:			0000019871
		STANDARD INDUSTRIAL CLASSIFICATION:	METALWORKING MACHINERY & EQUIPMENT [3540]
		IRS NUMBER:				360904920
		STATE OF INCORPORATION:			IL
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-01227
		FILM NUMBER:		04694611

	BUSINESS ADDRESS:	
		STREET 1:		901 FRONTENAC RD
		STREET 2:		P O BOX 3061
		CITY:			NAPERVILLE
		STATE:			IL
		ZIP:			60566
		BUSINESS PHONE:		6303578500

	MAIL ADDRESS:	
		STREET 1:		901 FRONTENAC RD
		STREET 2:		P O BOX 3061
		CITY:			NAPERVILLE
		STATE:			IL
		ZIP:			60566
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>c83813e10vk.txt
<DESCRIPTION>ANNUAL REPORT
<TEXT>
<PAGE>

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                      ------------------------------------

                                   FORM 10-K
                       FOR ANNUAL AND TRANSITION REPORTS
                    PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

<Table>
<S>    <C>
(Mark One)
[X]        ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                     SECURITIES EXCHANGE ACT OF 1934

            For the fiscal year ended December 31, 2003
                                OR

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                     SECURITIES EXCHANGE ACT OF 1934

       For the transition period from           to

                   Commission file number 0-1227
</Table>

                          CHICAGO RIVET & MACHINE CO.
             (Exact Name of Registrant as Specified in Its Charter)

<Table>
<S>                                                 <C>
                     Illinois                                           36-0904920
         (State or Other Jurisdiction of                             (I.R.S. Employer
          Incorporation or Organization)                           Identification No.)

     901 Frontenac Road, Naperville, Illinois                             60563
     (Address of Principal Executive Offices)                           (Zip Code)
</Table>

       Registrant's telephone number, including area code (630) 357-8500

          Securities registered pursuant to Section 12(b) of the Act:

                              TITLE OF EACH CLASS
                                ---------------
                        Common Stock -- $1.00 Par Value
                  (including Preferred Stock Purchase Rights)
                             NAME OF EACH EXCHANGE
                              ON WHICH REGISTERED
                              --------------------
                            American Stock Exchange
                   (Trading privileges only, not registered)

        Securities registered pursuant to Section 12(g) of the Act: None

     INDICATE BY CHECK MARK WHETHER THE REGISTRANT: (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE
REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH
FILING REQUIREMENTS FOR THE PAST 90 DAYS.  YES  X                NO ____

     INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM
405 OF REGULATION S-K IS NOT CONTAINED HEREIN, AND WILL NOT BE CONTAINED, TO THE
BEST OF REGISTRANT'S KNOWLEDGE, IN DEFINITIVE PROXY OR INFORMATION STATEMENTS
INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-K OR ANY AMENDMENT TO THIS
FORM 10-K.    X

     INDICATE BY CHECK MARK WHETHER THE REGISTRANT IS AN ACCELERATED FILER (AS
DEFINED IN EXCHANGE ACT RULE 12B-2).  YES ____               NO  X

     THE AGGREGATE MARKET VALUE OF COMMON STOCK HELD BY NON-AFFILIATES OF THE
REGISTRANT AS OF JUNE 30, 2003 WAS $20,624,997.

 AS OF FEBRUARY 16, 2004, 966,132 SHARES OF THE REGISTRANT'S COMMON STOCK WERE
                                  OUTSTANDING.

                      DOCUMENTS INCORPORATED BY REFERENCE

     (1) PORTIONS OF THE COMPANY'S ANNUAL REPORT TO SHAREHOLDERS FOR THE YEAR
ENDED DECEMBER 31, 2003 (THE "2003 REPORT") ARE INCORPORATED BY REFERENCE IN
PARTS I, II AND IV OF THIS REPORT.

     (2) PORTIONS OF THE COMPANY'S DEFINITIVE PROXY STATEMENT WHICH IS TO BE
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IN CONNECTION WITH THE
COMPANY'S 2004 ANNUAL MEETING OF SHAREHOLDERS ARE INCORPORATED BY REFERENCE IN
PART III OF THIS REPORT.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

                           CHICAGO RIVET & MACHINE CO.
                         PERIOD ENDING DECEMBER 31, 2003

<TABLE>
<CAPTION>
Item                                                                           Page
 No.                                                                            No.
- ----                                                                           ----
<S>                                                                            <C>
                                     Part I

1.       Business                                                               3
2.       Properties                                                             4
3.       Legal Proceedings                                                      4
4.       Submission of Matters to a Vote of Security Holders                    4

                                     Part II

5.       Market for Registrant's Common Equity and Related
            Stockholder Matters                                                 6
6.       Selected Financial Data                                                6
7.       Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                              6
7a.      Quantitative and Qualitative Disclosures About Market Risk            11
8.       Financial Statements and Supplementary Data                           11
9.       Changes in and Disagreements with Accountants on Accounting
            and Financial Disclosure                                           11
9a.      Controls and Procedures                                               11

                                    Part III

10.      Directors and Executive Officers of the Registrant                    12
11.      Executive Compensation                                                12
12.      Security Ownership of Certain Beneficial Owners and
            Management and Related Stockholder Matters                         12
13.      Certain Relationships and Related Transactions                        12
14.      Principal Accountant Fees and Services                                13

                                     Part IV

15.      Exhibits, Financial Statement Schedules, and Reports on
            Form 8-K                                                           13
</TABLE>

                                       2
<PAGE>

                                     PART I

ITEM 1 - BUSINESS

         Chicago Rivet & Machine Co. (the Company) was incorporated under the
laws of the State of Illinois in December 1927, as successor to the business of
Chicago Rivet & Specialty Co. The Company operates in two segments of the
fastener industry: fasteners and assembly equipment. The fastener segment
consists of the manufacture and sale of rivets, cold-formed fasteners and parts
and screw machine products. The assembly equipment segment consists primarily of
the manufacture of automatic rivet setting machines, automatic assembly
equipment, parts and tools for such machines, and the leasing of automatic rivet
setting machines. For further discussion regarding the Company's operations and
segments see Note 10 of the financial statements which appears on page 10 of the
Company's 2003 Annual Report to Shareholders. The 2003 Annual Report is filed as
an exhibit to this report.

         The principal market for the Company's products is the North American
automotive industry. Sales are solicited by employees and by independent sales
representatives.

         The segments in which the Company operates are characterized by active
and substantial competition. No single company dominates the industry. The
Company's competitors include both larger and smaller manufacturers, and
segments or divisions of large, diversified companies with substantial financial
resources. Principal competitive factors in the market for the Company's
products are quality, service, reliability and price.

         The Company serves a variety of customers. Revenues are primarily
derived from sales to customers involved, directly or indirectly, in the
manufacture of automobiles and automotive components. Information concerning
backlog of orders is not considered material to the understanding of the
Company's business due to relatively short production cycles. The level of
business activity for the Company is closely related to the overall level of
industrial activity in the United States. During 2003, sales to two customers
exceeded 10% of the Company's consolidated revenues. Sales to TI Group
Automotive Systems Corporation accounted for approximately 13% of the Company's
consolidated revenues in 2003, 18% in 2002 and 18% in 2001. Sales to Fisher &
Company accounted for approximately 21%, 17% and 14% of the Company's
consolidated revenues in 2003, 2002, and 2001, respectively. Sales to Purchased
Parts Group accounted for approximately 10% of the Company's consolidated
revenues in 2001.

         The Company's business has historically been stronger during the first
half of the year.

         The Company purchases raw material from a number of sources, primarily
within the United States. There are numerous sources of raw material, and the
Company does not have to rely on a single source for any of its requirements.
Beginning early in 2004, the cost of raw materials used in the manufacture of
fasteners escalated sharply and some suppliers have indicated that global demand
may constrain material availability.

         Patents, trademarks, licenses, franchises and concessions are not of
significant importance to the business of the Company.

         The Company does not engage in significant research activities, but
rather in ongoing product improvement and development. The amounts spent on
product development activities in the last three years were not material.

                                       3
<PAGE>

         At December 31, 2003, the Company employed 308 people.

         The Company has no foreign operations, and sales to foreign customers
represent only a minor portion of the Company's total sales.

ITEM 2 - PROPERTIES

         The Company conducts its manufacturing and warehousing operations at
five plants, which are described below. All five plants are owned by the Company
and considered suitable and adequate for their present use. The Company also
currently maintains a small sales office in Norwell, Massachusetts in a leased
facility.

         Of the properties described below, the Jefferson, Iowa and the Madison
Heights, Michigan facilities are used entirely in the fastener segment. The
Albia, Iowa facility is used exclusively in the assembly equipment segment. The
Tyrone, Pennsylvania and the Naperville, Illinois facilites are utilized in both
operating segments.

                        Plant Locations and Descriptions

Naperville, Illinois                Brick, concrete  block and partial
                                     metal construction with metal roof.

Tyrone, Pennsylvania                Concrete block with small tapered
                                     beam type warehouse.

Jefferson, Iowa                     Steel tapered beam construction.

Albia, Iowa                         Concrete block with prestressed
                                     concrete roof construction.

Madison Heights, Michigan           Concrete, brick and partial metal
                                     construction with metal roof.

ITEM 3 - LEGAL PROCEEDINGS

         The Company is, from time to time involved in litigation, including
environmental claims, in the normal course of business. While it is not possible
at this time to establish the ultimate amount of liability with respect to
contingent liabilities, including those related to legal proceedings, management
is of the opinion that the aggregate amount of any such liabilities, for which
provision has not been made, will not have a material adverse effect on the
Company's financial position.

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         No matter was submitted to a vote of the Company's shareholders during
the fourth quarter of 2003.

                                       4
<PAGE>

                      Executive Officers of the Registrant

         The names, ages and positions of all executive officers of the Company,
as of March 26, 2004, are listed below. Officers are elected annually by the
Board of Directors at the meeting of the directors immediately following the
Annual Meeting of Shareholders. There are no family relationships among these
officers, nor any arrangement or understanding between any officer and any other
person pursuant to which the officer was selected.

<TABLE>
<CAPTION>
Name and Age of Officer                       Position               Years an Officer
- -----------------------                       --------               ----------------
<S>                        <C>        <C>                            <C>
John A. Morrissey          68         Chairman, Chief                      23
                                       Executive Officer

John C. Osterman           52         President, Chief Operating           20
                                       Officer and Treasurer

Nirendu Dhar               62         General Manager,                      3
                                       H & L Tool Company, Inc.

Donald P. Long             52         Vice President-Sales                  9

Kimberly A. Kirhofer       45         Secretary                            13

Michael J. Bourg           41         Controller                            5
</TABLE>


- -        Mr. Morrissey has been Chairman of the Board of Directors of the
         Company since November 1979, and Chief Executive Officer since August
         1981. He has been a director of the Company since 1968.

- -        Mr. Osterman has been President, Chief Operating Officer and Treasurer
         of the Company since September 1987. He was Assistant Secretary from
         November 1983 to May 1985 when he became Assistant Vice
         President-Administration. He became Vice President-Administration in
         May 1986 and was named Executive Vice President in May 1987. He has
         been a director of the Company since May 1988.

- -        Mr. Dhar has been employed as General Manager of the Company's
         subsidiary, H & L Tool Company, Inc., since 1996. Mr. Dhar was employed
         as Plant Manager and Chief Engineer of H & L Tool Company, Inc. prior
         to the Company's acquisition of H & L Tool Company for more than five
         years. He has been a director of the Company since May 2001.

- -        Mr. Long has been Vice President-Sales of the Company since November
         1994, and was Director of Sales and Marketing of the Company from March
         1993 through November 1994. Prior to that, he was employed by Townsend
         Engineered Products, a maker of rivets, cold-formed fasteners and rivet
         setting equipment in various sales management positions for more than 5
         years.

- -        Mrs. Kirhofer has been Secretary of the Company since August 1991, and
         was Assistant Secretary of the Company from February 1991 through
         August 1991. Prior to that, she held various administrative positions
         with the Company since May 1983.

- -        Mr. Bourg has been Controller of the Company since December 1998. Prior
         to that, he was Accounting Manager at Fuchs Lubricants Co., a
         manufacturer of industrial lubricants, for two years and prior to that
         was employed by the public accounting firm of McGladrey & Pullen, LLP
         as a public accountant, for more than five years.

                                       5
<PAGE>

                                     PART II

ITEM 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND
 RELATED STOCKHOLDER MATTERS

         The Company's common stock is traded on the American Stock Exchange
(trading privileges only, not registered). As of December 31, 2003 there were
approximately 310 record holders of such stock. The information on the market
price of, and dividends paid with respect to, the Company's common stock, set
forth in the section entitled "Information on Company's Common Stock" which
appears on page 12 of the 2003 Annual Report is incorporated herein by
reference. The 2003 Annual Report is filed as an exhibit to this report. See
Item 7 - "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Dividends," for additional information about the
Company's dividend policy.

ITEM 6 - SELECTED FINANCIAL DATA

         The section entitled "Selected Financial Data" which appears on page 11
of the 2003 Annual Report is incorporated herein by reference. The 2003 Annual
Report is filed as an exhibit to this report.

ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
 FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This discussion contains certain "forward-looking statements" which are
inherently subject to risks and uncertainties that may cause actual events to
differ materially from those discussed herein. Factors which may cause such
differences in events include, among other things, our ability to maintain our
relationships with our significant customers; increased global competition;
increases in the prices of, or limitations on the availability of, our primary
raw materials; or a downturn in the automotive industry, upon which we rely for
sales revenue, and which is cyclical and dependent on, among other things,
consumer spending, international economic conditions and regulations and
policies regarding international trade. Many of these factors are beyond our
ability to control or predict. Readers are cautioned not to place undue reliance
on these forward-looking statements. We undertake no obligation to publish
revised forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.

         In addition to the disclosures contained herein, readers are also urged
to carefully review and consider any risks and uncertainties contained in other
documents filed by the Company with the Securities and Exchange Commission.

RESULTS OF OPERATIONS

         The past year was extremely difficult for the Company. After a
relatively auspicious start, which fostered an optimistic outlook for the
balance of the year, our business weakened considerably as production of
domestic automobiles trailed prior year levels and domestic manufacturing
activity, in general, remained weak. In addition, our customers continued to
demand price concessions, while simultaneously raising the bar with respect to
quality and service requirements. In response to these conditions, we relied on
the time-tested approach of cost containment and cost reductions. In retrospect,
it is clear that these actions were insufficient to offset the combined impact
of lower volumes, lower prices and increased service expectations.

                                       6
<PAGE>

2003 COMPARED TO 2002

         Reduced revenues were the dominant factor contributing to reduced
margins within the fastener segment during 2003. Fastener segment revenues
declined abruptly late in the first quarter and remained weak for the balance of
the year. For the year 2003, fastener segment revenues declined 11.3% compared
to 2002, totaling a disappointing $31,024,036. Reductions in North American
production of domestic automobiles and trucks contributed to the weakness in our
business as did continuing competitive pressures which contributed to the loss
of some business, as we were unable to meet the price concessions demanded by
certain customers. In addition, some high margin parts were lost in connection
with design changes that accompanied the new model year. Reductions in
manufacturing staff failed to keep pace with the decline in business activity,
and the resultant inefficiencies are reflected in disproportionately higher
labor costs in 2003, compared to 2002. In addition, margins were adversely
affected by increases in the cost of employee health insurance and higher
tooling expenses incurred in connection with the initial production of a variety
of new parts.

         Within the assembly equipment segment, revenues declined 10.6% compared
to 2002. As was the case in the fastener segment, lower volumes contributed to
significantly reduced operating efficiencies that were manifested in
disproportionately high labor and benefit costs compared with prior years. Other
factors impacting margins within this segment were increases in the cost of raw
materials, offset in part, by a decrease in depreciation expense.

         Selling and administrative expenses for 2003 were 5.9% below those for
2002. A $302,000 reduction in profit sharing expense was the largest single
factor contributing to the decrease in this expense category, followed by
reductions of $145,000 in bonus expense, and $96,000 in commission expense due
to lower sales in the current year. These reductions were partially offset by a
$74,000 expense related to an early retirement program and an increase in the
cost of employee health insurance.

         Net interest income increased by approximately $45,000 during 2003,
primarily as a result of lower interest expense related to lower balances on a
note payable, which was paid in full in December.

2002 COMPARED TO 2001

         Net sales and lease revenues improved approximately 6% compared with
2001 and totaled $43,012,766 in 2002. As discussed below, revenue gains were
achieved in both the fastener and assembly equipment segments and the increased
volume, coupled with successful efforts to hold the line on costs, translated
into improvements in gross margins, which amounted to $10,585,563 for 2002,
compared with $9,187,046 recorded in 2001.

         Within the fastener segment, revenues increased 7%, to $34,991,758,
reflecting an overall increase in automobile production. However, it should be
noted that our volumes did not increase across our entire customer base.
Instead, our overall gain was due to increases in business with certain key
customers, bolstered by revenues related to new customers and new products from
existing customers.

         Gross margins within the fastener segment improved to 21.1% in 2002,
compared with 19.9% recorded in 2001. This improvement was largely attributable
to the effects of higher volumes and increases in efficiency associated with
those higher volumes. A number of other factors impacted operations during the
year. While we benefited

                                       7
<PAGE>

from reductions in tooling costs, those savings were offset by increases in the
cost of materials and by a substantial increase in the cost of employee health
insurance.

         Activity levels within the assembly equipment segment remained well
below historical levels. While revenues within the segment improved to
$8,021,008 in 2002, compared with $7,738,868 in 2001, the change is attributable
to a few large orders and not due to any significant improvement in the market
for equipment, which remained adversely affected by a persistent decline in the
broad manufacturing sector and the related restraint on capital spending.
Nevertheless, gross margins within this segment improved to approximately 40% in
2002 compared with 35% for 2001. This improvement is primarily attributable to
higher volumes and reduced labor expense.

         Selling and administrative expenses increased approximately 3.7%
compared with 2001. Both profit sharing and sales commissions increased as a
result of higher sales and increased profits. Other factors contributing to the
increase include higher salary expense and increased health insurance costs,
partially offset by a decrease in the provision for bad debt expense, which was
unusually high in the prior year due to the bankruptcy filing of a certain
customer.

         The Company recorded net interest income during 2002 of $4,214,
compared with net interest expense of $114,607 in 2001, as a result of lower
prevailing interest rates and reduced debt levels.

DIVIDENDS

         In determining to pay dividends, the Board considers current
profitability, the outlook for longer-term profitability, known and potential
cash requirements and the overall financial condition of the Company. The
Company paid four regular quarterly dividends of $.18 per share during 2003. In
addition, an extra dividend of $.25 per share was paid during the second quarter
of 2003, bringing the total dividend distribution to $.97 per share. On February
16, 2004, your Board of Directors determined that an extra dividend would not be
declared or paid in the second quarter of 2004; however, the Board did declare a
regular quarterly dividend of $.18 per share, payable March 19, 2004 to
shareholders of record on March 5, 2004. This continues the uninterrupted record
of consecutive quarterly dividends paid by the Company to its shareholders that
extends over 70 years.

PROPERTY, PLANT AND EQUIPMENT

         During 2003, capital expenditures amounted to $641,715, of which
$535,268 was invested within the fastener segment, $89,379 was invested within
the assembly equipment segment and the remainder was expended for building
improvements that cannot be allocated between segments. Within the fastener
segment, approximately $317,000 was invested in a new solvent based parts
cleaning system. This system, installed during the second half of the year, is
expected to yield reductions in supply and waste disposal costs. Other
expenditures were approximately $92,000 for vehicles, including $68,000 for a
new delivery truck; $32,000 for in-line wire drawing equipment; some $21,000 for
equipment related to quality control; with the balance expended for smaller
tools and equipment and building improvements. Within the assembly equipment
segment, approximately $86,000 was expended for the purchase of new equipment
related to the manufacture of perishable tooling that is sold to customers. The
balance was expended for building improvements and office equipment.

         Investments in machinery and equipment totaled $886,009 in 2002. The
majority of this investment was related to the fastener segment of our
operations. Approximately $567,000 was invested in new equipment directly
related to the manufacture of fasteners, with an additional $123,000 expended
for equipment related to quality control and finishing operations for the
fastener segment. The balance

                                       8
<PAGE>

was expended for a variety of items, including material handling, data
processing and other equipment.

         The Company invested approximately $1.4 million in machinery, equipment
and building improvements during 2001. The majority of these expenditures were
related to the fastener segment of our operations. Specifically, a total of $1.1
million was expended for the purchase of equipment used directly in the
manufacture of fasteners and $88,000 was invested in new equipment related to
the quality control process in fastener manufacturing. $129,000 was expended in
connection with data processing and data communications equipment, $61,000 was
spent for building improvements, primarily related to the fastener segment of
our business, and the balance was expended for a variety of smaller machinery
and equipment, including the manufacture of automatic rivet setting equipment
that is leased to our customers.

         Depreciation expense amounted to $1,861,600 in 2003, $1,915,726 in 2002
and $1,921,703 in 2001.

LIQUIDITY AND CAPITAL RESOURCES

         The Company's holdings in cash, cash equivalents and certificates of
deposits amounted to nearly $6.0 million at December 31, 2003, an increase of
approximately $.6 million compared with the end of 2002. Accounts receivable
balances decreased approximately $.4 million, reflecting lower sales during the
latter part of 2003, compared to the same period in 2002. Inventory levels, at
the end of 2003, are also less than at the end of 2002 due to efforts taken to
reduce inventories in response to continued weakness in demand for our products.

         In connection with a "Dutch auction" tender offer in April 2000, the
Company obtained, on an unsecured basis, a financing commitment that provided
borrowing capacity of up to $9.0 million plus a $1.0 million line of credit. The
new borrowing was used to finance the unpaid balance of a 1996 loan related to
the acquisition of H & L Tool Company, Inc. ($2.7 million) and to fund the
purchase of stock under the terms of the "Dutch auction." At December 31, 2003,
the indebtedness under the term loan had been extinguished. The line of credit
was extended through May 31, 2004 and remained unused at December 31, 2003.

Off-Balance Sheet Arrangements

         The Company has not entered into, and has no current plans to enter
into, any off-balance sheet financing arrangements.

         The following table presents a summary of the Company's contractual
obligations as of December 31, 2003:

<TABLE>
<CAPTION>
                                           Payments Due By Period
                             -------------------------------------------------------
                                        Less Than     1 - 3     4 - 5     More Than
Cotractual Obligation         Total      1 Year       Years      Years     5 Years
- ---------------------       --------     --------   --------   -------    ---------
<S>                        <C>          <C>        <C>        <C>       <C>
Long-term Debt              $     --     $    --    $   --     $    --    $ --
Capital Lease Obligations         --          --        --          --      --
Operating Leases              36,657       27,493      9,164        --      --
Purchase Obligations         378,686      160,750    200,256    17,680      --
                            --------     --------   --------   -------    ----
Total                       $415,343     $188,243   $209,420   $17,680    $ --
                            ========     ========   ========   =======    ====
</TABLE>

         Management believes that current cash, cash equivalents and operating
cash flow will be sufficient to provide adequate working capital for the
foreseeable future.

                                       9
<PAGE>

APPLICATION OF CRITICAL ACCOUNTING POLICIES

         The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the amounts of revenue and expenses during
the reporting period. During interim periods, the Company uses estimated gross
profit rates to determine the cost of goods sold for a portion of its
operations. Actual results can vary from these estimates, and these estimates
are adjusted, as necessary, when actual information is available. The effect of
these estimates is described in Note 11 of the financial statements.

NEW ACCOUNTING STANDARDS

         The Company's financial statements and financial condition were not,
and are not expected to be, materially impacted by new, or proposed, accounting
standards.

STOCK PURCHASE PROGRAM

         Terms of a stock repurchase authorization originally approved by the
Board of Directors in February of 1990, and subsequently amended to permit the
repurchase of an aggregate of 200,000 shares, permit purchases of the Company's
common stock to be made from time to time, in the open market or in private
transactions, at prices deemed reasonable by management. The company did not
purchase any of its shares during 2003. During 2002, the company purchased 1,000
shares at an average price of $26.98 per share. Cumulative purchases under the
repurchase authorization have amounted to 162,996 shares at an average price of
$15.66 per share.

OUTLOOK FOR 2004

         The anticipated improvement in economic activity has not yet generated
a meaningful increase in orders for our products. While we are encouraged by the
fact that we have been awarded contracts for a number of new parts in the
fastener segment, we are concerned about conditions within the assembly
equipment segment, which remains very weak. Domestic competition remains intense
and foreign competition, which affects us directly through the increase of
imported fasteners and indirectly through the import of products that were
previously assembled domestically, is a growing concern. These conditions
increase the risk that our markets will not only become even more price
competitive due to imports, but will shrink in size as domestic assembly
operations are supplanted by imports of products that were traditionally
assembled domestically, utilizing domestic fasteners and domestic assembly
equipment.

         As mentioned above, we are pleased that we have been awarded new
business within the fastener segment, but, in many instances, production volumes
related to this new business will not reach significant levels until later in
2004. We will continue soliciting additional business from our current customers
as well as from new customers. We face challenges in the form of recent and
significant increases in the cost of raw materials utilized in the production of
fasteners. While we have not experienced shortages of raw material, some of our
suppliers report that increases in global demand may constrain availability of
raw materials later this year. Our success in maintaining supply and recovering
these higher costs, without losing market share, will be a critical determinant
of our success in the coming year.

         Cost reduction will be another critical factor influencing future
results. As previously reported, we have already taken actions to reduce our
manufacturing costs,

                                       10
<PAGE>

but the cost reductions realized have not fully offset the impact of lower
volumes. We will continue exploring alternatives that will yield positive
changes in our cost structure and our ability to compete. Margins, at least in
the near term, will remain under pressure from the combination of rising costs
and increasing foreign competition.

         We gratefully acknowledge that the Company's success, both past and
future, would not be possible without: the conscientious efforts of our
employees, who consistently demonstrate their dedication to meeting the
formidable and ever-changing challenges that characterize today's manufacturing
environment; the loyalty of our customers, many of whom face the same set of
challenges; and, the continuing support of our shareholders.

ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         As of December 31, 2003, the Company did not have any outstanding debt,
compared to $1.6 million of outstanding debt at the prior year end, that was
exposed to changes in interest rates. During 2003 the Company did not use
derivative financial instruments relating to this interest rate exposure.

ITEM 8 - FINANCIAL STATEMENTS AND
 SUPPLEMENTARY DATA

         See the sections entitled "Consolidated Financial Statements" and
"Financial Statement Schedule" which appear on pages 15 through 18 of this
report.

ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
 ACCOUNTING AND FINANCIAL DISCLOSURE

         There have been no changes in or disagreements with accountants
requiring disclosure herein.

ITEM 9A - CONTROLS AND PROCEDURES

         (a) Disclosure Controls and Procedures. The Company's management, with
the participation of the Company's Chief Executive Officer and Chief Financial
Officer, has evaluated the effectiveness of the Company's disclosure controls
and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under
the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the
end of the period covered by this report. Based on such evaluation, the
Company's Chief Executive Officer and Chief Financial Officer have concluded
that, as of the end of such period, the Company's disclosure controls and
procedures are effective in recording, processing, summarizing and reporting, on
a timely basis, information required to be disclosed by the Company in the
reports that it files or submits under the Exchange Act.

         (b) Internal Control Over Financial Reporting. There have not been any
changes in the Company's internal control over financial reporting (as such term
is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the
fiscal quarter to which this report relates that have materially affected, or
are reasonably likely to materially affect, the Company's internal control over
financial reporting.

                                       11
<PAGE>

                                    PART III

ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The information with respect to the Board of Directors' nominees for
directors that is not related to security ownership, which is set forth in the
section entitled "Election of Directors" on pages 4 through 7 of the Company's
2004 Proxy Statement, is incorporated herein by reference. The information with
respect to the audit committee, its financial expert and the independence of its
members, which is set forth in the second paragraph of the section entitled
"Additional Information Concerning the Board of Directors and Committees" on
page 7 of the Company's 2004 Proxy Statement, is incorporated herein by
reference. The information with regard to compliance with Section 16 (a) of the
Exchange Act, which is set forth in the section entitled "Section 16(a)
Beneficial Ownership Reporting Compliance" on page 10 of the 2004 Proxy
Statement, is incorporated herein by reference. The 2004 Proxy Statement is to
be filed with the Securities and Exchange Commission in connection with the
Company's 2004 Annual Meeting of Shareholders. The information called for with
respect to executive officers of the Company is included in Part I of this
Report on Form 10-K under the caption "Executive Officers of the Registrant."

         The Company has adopted a code of ethics for its principal executive
officer, chief operating officer and senior financial officers. A copy of this
code is included as Exhibit 14 to this report on Form 10-K.

ITEM 11 - EXECUTIVE COMPENSATION

         The information set forth in the section entitled "Executive
Compensation" which appears on pages 11 through 15 of the Company's 2004 Proxy
Statement and the information relating to compensation of directors set forth in
the last paragraph of the section entitled "Additional Information Concerning
the Board of Directors and Committees" which appears on pages 7 through 10 of
the Company's 2004 Proxy Statement is incorporated herein by reference. The 2004
Proxy Statement is to be filed with the Securities and Exchange Commission in
connection with the Company's 2004 Annual Meeting of Shareholders.

ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
 OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS

         The information set forth in the section entitled "Principal
Shareholders" on page 3 of the Company's 2004 Proxy Statement and the
information with respect to security ownership of the Company's directors and
officers set forth in the section entitled "Security Ownership of Management" on
pages 5 through 7 of the Company's 2004 Proxy Statement is incorporated herein
by reference. The 2004 Proxy Statement is to be filed with the Securities and
Exchange Commission in connection with the Company's 2004 Annual Meeting of
Shareholders.

         The Company does not have any equity compensation plans or
arrangements.

ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The information relating to the law firm of Morrissey & Robinson set
forth in the last sentence of footnote (2) on page 6 of the Company's 2004 Proxy
Statement is incorporated herein by reference. The 2004 Proxy Statement is to be
filed with the Securities and Exchange Commission in connection with the
Company's 2004 Annual Meeting of Shareholders.

                                       12
<PAGE>

ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES

         The information set forth in section entitled "Independent Certified
Public Accountants" on pages 17 and 18 of the Company's 2004 Proxy Statement is
incorporated herein by reference. The 2004 Proxy Statement is to be filed with
the Securities and Exchange Commission in connection with the Company's 2004
Annual Meeting of Shareholders.

                                     PART IV

ITEM 15 - EXHIBITS, FINANCIAL STATEMENT
 SCHEDULES AND REPORTS ON FORM 8-K

         (a)               The following documents are filed as a part of this
                           report:

                  1.       Financial Statements:

                           See the section entitled "Consolidated Financial
                           Statements" which appears on page 15 of this report.

                  2.       Financial statement schedule and supplementary
                           information required to be submitted.

                           See the section entitled "Financial Statement
                           Schedule" which appears on pages 16 through 18 of
                           this report.

                  3.       Exhibits:

                           See the section entitled "Exhibits" which appears on
                           page 19 of this report.

         (b)               Reports on Form 8-K

                  1.       The Company did not file any reports on Form 8-K
                           during the quarter ended December 31, 2003.

                                       13
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, Chicago Rivet & Machine Co. has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

                                                Chicago Rivet & Machine Co.

                                                By   /s/John C. Osterman
                                                  -----------------------
                                                John C. Osterman, President
                                                and Chief Operating Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated:

/s/John A. Morrissey                            Chairman of the Board of
- --------------------                            Directors, Chief Executive
John A. Morrissey                               Officer and Member of the
                                                Executive Committee
                                                March 29, 2004


/s/John C. Osterman                             President, Chief Operating
- -------------------                             Officer, Treasurer (Chief
John C. Osterman                                Financial Officer), Member
                                                of the Executive Committee
                                                and Director
                                                March 29, 2004

/s/John R. Madden                               Director, Member of the
- ------------------                              Executive Committee and Member
John R. Madden                                  of the Audit Committee
                                                March 29, 2004


/s/Walter W. Morrissey                          Director, Member of Executive
- ----------------------                          Committee
Walter W. Morrissey                             March 29, 2004


/s/Michael J. Bourg                             Controller (Principal Accounting
- -------------------                             Officer)
Michael J. Bourg                                March 29, 2004


                                       14
<PAGE>

                           CHICAGO RIVET & MACHINE CO.

                        CONSOLIDATED FINANCIAL STATEMENTS

         The consolidated financial statements, together with the notes thereto
and the report thereon of PricewaterhouseCoopers LLP dated February 25, 2004,
appearing on pages 5 to 11 of the accompanying 2003 Annual Report, and the
section entitled "Quarterly Financial Data (Unaudited)" appearing on page 12 of
the accompanying 2003 Annual Report are incorporated herein by reference. With
the exception of the aforementioned information and the information incorporated
in Items 1, 5, 6 and 8 herein, the 2003 Annual Report is not to be deemed filed
as part of this Form 10-K Annual Report.

Consolidated Financial Statements from 2003 Annual Report (Exhibit 13 hereto):

Consolidated Balance Sheets (page 5 of 2003 Annual Report)

Consolidated Statements of Income (page 6 of 2003 Annual Report)

Consolidated Statements of Retained Earnings (page 6 of 2003 Annual Report)

Consolidated Statements of Cash Flows (page 7 of 2003 Annual Report)

Notes to Consolidated Financial Statements (pages 8, 9, and 10 of 2003 Annual
Report)

Report of Independent Auditors (page 11 of 2003 Annual Report)

Quarterly Financial Data (Unaudited) (page 12 of 2003 Annual
Report)

                                       15
<PAGE>

                          FINANCIAL STATEMENT SCHEDULE

                               2003, 2002 AND 2001

         The following financial statement schedule should be read in
conjunction with the consolidated financial statements and the notes thereto in
the 2003 Annual Report. Financial statement schedules not included herein have
been omitted because they are not applicable or the required information is
shown in the consolidated financial statements or notes thereto.

<TABLE>
<CAPTION>
                                                                     Page
                                                                     ----
<S>                                                                  <C>
Financial Statement Schedule:

Valuation and Qualifying Accounts (Schedule II)                       17

Report of Independent Auditors on Financial Statement Schedule        18
</TABLE>

                                       16
<PAGE>


                           CHICAGO RIVET & MACHINE CO.
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
              FOR THE YEARS ENDED DECEMBER 31, 2003, 2002 AND 2001

<TABLE>
<CAPTION>
                                           Balance at    Additions                    Balance
                                           Beginning    Charged to                    at End
Classification                              of Year      Expenses    Deductions(1)   of Year
- --------------                             ----------   ----------   ------------    --------
<S>                                        <C>          <C>          <C>             <C>
2003
Allowance for doubtful accounts, returns
and allowances                             $ 240,000    $ 10,174     $ 30,174        $220,000

2002
Allowance for doubtful accounts,
returns and allowances                      $240,000    $  7,067     $  7,067        $240,000

2001
Allowance for doubtful accounts,
returns and allowances                     $  90,000    $172,728     $ 22,728        $240,000
</TABLE>

(1) Accounts receivable written off, net of recoveries.

                                       17
<PAGE>

                        Report of Independent Auditors on
                          Financial Statement Schedule

To the Board of Directors
of Chicago Rivet & Machine Co.

Our audits of the consolidated financial statements referred to in our report
dated February 25, 2004 appearing in the 2003 Annual Report to Shareholders of
Chicago Rivet & Machine Co. (which report and financial statements are
incorporated by reference in this Annual Report on Form 10-K) also included an
audit of the Financial Statement Schedule listed in Item 15(a)(2) of this Form
10-K. In our opinion, this Financial Statement Schedule presents fairly, in all
material respects, the information set forth therein when read in conjunction
with the related consolidated financial statements.

PricewaterhouseCoopers LLP

Chicago, Illinois
February 25, 2004

                                       18
<PAGE>

                           CHICAGO RIVET & MACHINE CO.

                                    EXHIBITS

                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>
Exhibit
Number                                                                            Page
- ------                                                                          -------
<S>        <C>                                                                  <C>
3.1        Articles of Incorporation and Charter.
           Incorporated by reference to Company's
           report on Form 10, dated March 30, 1935.

3.2        Certified copy of articles of Amendment to
           Articles of Incorporation, dated November 4,
           1959.  Incorporated by reference to Company's
           report on Form 8-A, dated April 30, 1965.

3.3        Amendment of Articles of Incorporation
           creating a class of 500,000 shares of no
           par value preferred stock.  Incorporated by
           reference to Company's report on Form 10-K,
           dated April 30, 1972.

3.4        Amended and Restated By-Laws, as amended
           February 16, 2004.                                                   21 - 46

3.5        Articles of Incorporation, as amended by the amendment to the
           Articles of Incorporation, dated August 18, 1997. Incorporated
           by reference to the Company's report on Form 10-K, dated March
           27, 1998.

4.1        Rights Agreement, dated November 22, 1999,
           between the Company and First Chicago Trust Company
           of New York as Rights Agent. Incorporated
           by reference to the Company's report on
           Form 10-K, dated March 29, 2000.

13*        Annual Report to Shareholders for the year
           ended December 31, 2003.                                             47 - 63

14         Code of Ethics for Principal Executive and Senior
           Financial Officers                                                   64 - 66

21         Subsidiaries of the Registrant.                                        67


31.1       Certification of CEO Pursuant to Rule 13a-14(a)
           or 15d-14(a) as Adopted Pursuant to Section 302 of
           the Sarbanes-Oxley Act of 2002.                                        68

31.2       Certification of CFO Pursuant to Rule 13a-14(a)
           or 15d-14(a) as Adopted Pursuant to Section 302 of
           the Sarbanes-Oxley Act of 2002.                                        69
</TABLE>

                                       19
<PAGE>

<TABLE>
<S>        <C>                                                                  <C>

32.1       Certification of CEO Pursuant to 18 U.S.C. Section 1350,
           as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
           Act of 2002.                                                           70


32.2       Certification of CFO Pursuant to 18 U.S.C. Section 1350,
           as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
           Act of 2002.                                                           71
</TABLE>

* Only the portions of this exhibit which are specifically incorporated herein
by reference shall be deemed to be filed herewith.

                                       20

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.4
<SEQUENCE>3
<FILENAME>c83813exv3w4.txt
<DESCRIPTION>AMENDED AND RESTATED BY-LAWS
<TEXT>
<PAGE>


                                   EXHIBIT 3.4

                          AMENDED AND RESTATED BY-LAWS,

                          AS AMENDED FEBRUARY 16, 2004

                                       21
<PAGE>

                          AMENDED AND RESTATED BY-LAWS

                            (AS OF FEBRUARY 16, 2004)

                                       OF

                          CHICAGO RIVET & MACHINE CO.,
                             an Illinois corporation
                               (the "Corporation")

                                   ARTICLE I
                                    OFFICES

         The principal office of the Corporation shall be in the City of
Naperville, County of DuPage and State of Illinois. The Corporation may also
have offices at such other places, either within or without the State of
Illinois, as the Board of Directors may from time to time appoint or as the
business may require.

                                   ARTICLE II
                             SHAREHOLDERS' MEETINGS

         SECTION 1. THE ANNUAL MEETING. The annual meeting of the shareholders
shall be held at the principal office of the Corporation at 10:00 o'clock A. M.
(Chicago time) on the second Tuesday in May of each year, or if such day be a
holiday, then upon the next succeeding secular day. A written or printed notice
stating the place, day and hour of the meeting shall be mailed by the Secretary
or an Assistant Secretary of the Corporation at least ten days before such
meeting to each shareholder to his, her or its last known post-office address,
as appears on the books of the Corporation. A majority of the capital stock
outstanding represented in person or by proxy shall constitute a quorum at all
shareholders' meetings.

         SECTION 2. SPECIAL MEETINGS.

                  (a)      Special meetings of the shareholders may be called by
(i) the President or (ii) the Board of Directors and shall be called by the
President or the Board of Directors upon the demand, in accordance with this
Section 2, of holders of not less than one-fifth of all the outstanding shares
of the Corporation entitled to vote on the matter proposed to be considered at
the special meeting, for the purpose or purposes stated in the call of the
meeting.

                  (b)      In order that the Corporation may determine the
shareholders entitled to demand a special meeting, the Board

                                       22
<PAGE>

of Directors may fix a record date to determine the shareholders entitled to
make such a demand (the "Demand Record Date"). The Demand Record Date shall not
precede the date upon which the resolution fixing the Demand Record Date is
adopted by the Board of Directors and shall not be more than 10 days after the
date upon which the resolution fixing the Demand Record Date is adopted by the
Board of Directors. Any shareholder of record seeking to have shareholders
demand a special meeting shall, by sending written notice to the Secretary of
the Corporation by hand or by certified or registered mail, return receipt
requested, request the Board of Directors to fix a Demand Record Date. The Board
of Directors shall promptly, but in all events within 10 days after the date on
which a valid request to fix a Demand Record Date is received, adopt a
resolution fixing the Demand Record Date and shall make a public announcement of
such Demand Record Date. If no Demand Record Date has been fixed by the Board of
Directors within 10 days after the date on which such request is received by the
Secretary, the Demand Record Date shall be the 10th day after the first date on
which a valid written request to set a Demand Record Date is received by the
Secretary. To be valid, such written request shall set forth the purpose or
purposes for which the special meeting is to be held, shall be signed by one or
more shareholders of record (or their duly authorized proxies or other
representatives), shall bear the date of signature of each such shareholder (or
proxy or other representative) and shall set forth all information about each
such shareholder and about the beneficial owner or owners, if any, on whose
behalf the request is made that would be required to be set forth in a
shareholder's notice described in paragraph (a) of Section 16 of Article II of
these by-laws.

                  (c)      In order for a shareholder or shareholders to demand
a special meeting, a written demand or demands for a special meeting by the
holders of record as of the Demand Record Date of not less than one-fifth of all
the outstanding shares of the Corporation entitled to vote on the matter
proposed to be considered at the special meeting must be delivered to the
Corporation. To be valid, each written demand by a shareholder for a special
meeting shall set forth the specific purpose or purposes for which the special
meeting is to be held (which purpose or purposes shall be limited to the purpose
or purposes set forth in the written request to set a Demand Record Date
received by the Corporation pursuant to paragraph (b) of this Section 2), shall
be signed by one or more persons who as of the Demand Record Date are
shareholders of record (or their duly authorized proxies or other
representatives), shall bear the date of signature of each such shareholder (or
proxy or other representative), shall set forth the name and address, as they
appear in the Corporation's books, of each shareholder signing such demand and
the class and number of shares of the Corporation which are owned of record and
beneficially by each such shareholder, shall be sent to the Secretary by hand or
by certified or registered mail, return receipt requested, and shall be received
by the Secretary within 60 days after the Demand Record Date.

                                       23
<PAGE>

                  (d)      The Corporation shall not be required to call a
special meeting upon shareholder demand unless, in addition to the documents
required by paragraph (c) of this Section 2, the Secretary receives a written
agreement signed by each Soliciting Shareholder (as defined below), pursuant to
which each Soliciting Shareholder, jointly and severally, agrees to pay the
Corporation's costs of holding the special meeting, including the costs of
preparing and mailing proxy materials for the Corporation's own solicitation,
provided that if each of the resolutions introduced by any Soliciting
Shareholder at such meeting is adopted, and each of the individuals nominated by
or on behalf of any Soliciting Shareholder for election as a director at such
meeting is elected, then the Soliciting Shareholders shall not be required to
pay such costs. For purposes of this paragraph (d), the following terms shall
have the meanings set forth below:

                  (i)      "Affiliate" of any Person (as defined herein) shall
         mean any Person controlling, controlled by or under common control
         with such first Person.

                  (ii)     "Participant" shall have the meaning assigned to such
         term in Instruction 3 of Item 4 of Schedule 14A promulgated under the
         Securities Exchange Act of 1934, as amended (the "Exchange Act")

                  (iii)    "Person" shall mean any individual, firm,
         corporation, partnership, joint venture, association, trust,
         unincorporated organization or other entity.

                  (iv)     "Proxy" shall have the meaning assigned to such term
         in Rule 14a-1 promulgated under the Exchange Act.

                  (v)      "Solicitation" shall have the meaning assigned to
         such term in Rule 14a-1 promulgated under the Exchange Act.

                  (vi)     "Soliciting Shareholder" shall mean, with respect to
         any special meeting demanded by a shareholder or shareholders, any of
         the following Persons: (A) if the number of shareholders signing the
         demand or demands of meeting delivered to the corporation pursuant to
         paragraph (c) of this Section 2 is 10 or fewer, each shareholder
         signing any such demand; (B) if the number of shareholders signing the
         demand or demands of meeting delivered to the corporation pursuant to
         paragraph (c) of this Section 2 is more than 10, each Person who either
         (x) was a Participant in any Solicitation of such demand or demands or
         (y) at the time of the delivery to the

                                       24
<PAGE>

         Corporation of the documents described in paragraph (c) of this Section
         2 had engaged or intended to engage in any Solicitation of Proxies for
         use at such Special Meeting (other than a Solicitation of Proxies on
         behalf of the Corporation); or (C) any Affiliate of a Soliciting
         Shareholder, if a majority of the Directors then in office determine,
         reasonably and in good faith, that such Affiliate should be required to
         sign the written notice described in paragraph (c) of this Section 2
         and/or the written agreement described in this paragraph (d) in order
         to prevent the purposes of this Section 2 from being evaded.

                  (e)      Except as provided in the following sentence, any
special meeting shall be held at such hour and day as may be designated by
whichever of the President or the Board of Directors shall have called such
meeting. In the case of any special meeting called by the Board of Directors or
the President upon the demand of shareholders (a "Demand Special Meeting"), such
meeting shall be held at such hour and day as may be designated by the Board of
Directors or the President; provided, however, that the date of any Demand
Special Meeting shall be not more than 60 days after the Meeting Record Date (as
defined in Section 6 of this Article II); and provided further that in the event
that the Directors then in office fail to designate an hour and date for a
Demand Special Meeting within 10 days after the date that valid written demands
for such meeting by the holders of record as of the Demand Record Date of shares
representing not less than one-fifth of all the outstanding shares of the
Corporation entitled to vote on the matter proposed to be considered at the
special meeting are delivered to the Corporation (the "Delivery Date"), then
such meeting shall be held at 2:00 P.M. local time on the 90th day after the
Delivery Date or, if such 90th day is not a Business Day (as defined below), on
the first preceding Business Day. In fixing a meeting date for any special
meeting, the President or the Board of Directors may consider such factors as he
or it deems relevant within the good faith exercise of his or its business
judgment, including, without limitation, the nature of the action proposed to be
taken, the facts and circumstances surrounding any demand for such meeting, and
any plan of the Board of Directors to call an annual meeting or a special
meeting for the conduct of related business.

                  (f)      The Corporation may engage independent inspectors of
elections to act as an agent of the Corporation for the purpose of promptly
performing a ministerial review of the validity of any purported written demand
or demands for a special meeting received by the Secretary. For the purpose of
permitting the inspectors to perform such review, no purported demand shall be
deemed to have been delivered to the Corporation until the earlier of (i) 5
Business Days following receipt by the Secretary of such purported demand and
(ii) such date as the independent inspectors

                                       25
<PAGE>

certify to the Corporation that the valid demands received by the Secretary
represent not less than one-fifth of all the outstanding shares of the
Corporation entitled to vote on the matter proposed to be considered at the
special meeting. Nothing contained in this paragraph (f) shall in any way be
construed to suggest or imply that the Board of Directors or any shareholder
shall not be entitled to contest the validity of any demand, whether during or
after such 5 Business Day period, or to take any other action (including,
without limitation, the commencement, prosecution or defense of any litigation
with respect thereto).

                  (g)      For purposes of these by-laws, "Business Day" shall
mean any day other than a Saturday, a Sunday or a day on which banking
institutions in the State of Illinois are authorized or obligated by law or
executive order to close.

         SECTION 3. PLACE OF MEETING. The Board of Directors may designate any
place as the place of meeting for any annual meeting or for any special meeting
called by the Board of Directors. If no designation is made or if a special
meeting be otherwise called, the place of meeting shall be at the principal
office of the Company in Naperville, Illinois.

         SECTION 4. TIME OF ELECTING DIRECTORS. Directors shall be elected at
the regular annual meeting of the shareholders. If the election of directors is
not held on the day of the annual meeting, the directors shall cause the
election to be held as soon thereafter as conveniently may be. No failure to
elect directors or to hold the annual meeting at the designated time shall work
any forfeiture or dissolution of the Corporation.

         SECTION 5. NOTICE OF MEETINGS. Written notice stating the place, date,
and hour of the meeting, and in the case of a special meeting, the purpose or
purposes for which the meeting is called, shall be delivered not less than ten
nor more than sixty days before the date of the meeting, or in the case of a
merger, consolidation, share exchange, dissolution or sale, lease or exchange of
assets, not less than twenty nor more than sixty days before the meeting, either
personally or by mail, by or at the direction of the President, or the
Secretary, or the officer or persons calling the meeting, to each shareholder of
record entitled to vote at such meeting. If mailed, such notices shall be deemed
to be delivered when deposited in the United States mail, addressed to the
shareholder at his address as it appears on the records of the Corporation, with
postage thereon prepaid. When a meeting is adjourned to another time or place,
notice need not be given of the adjourned meeting if the time and place thereof
are announced at the meeting at which the adjournment is taken. Any previously
scheduled meeting of shareholders may be postponed, and any special meeting of
the shareholders may be cancelled upon public notice given prior to the date
previously scheduled for such meeting of shareholders.

                                       26
<PAGE>

         SECTION 6. FIXING OF RECORD DATE. The Board of Directors may fix in
advance a date not less than ten days and not more than sixty days, or in the
case of a merger, consolidation, share exchange, dissolution or sale, lease or
exchange of assets, not less than twenty and not more than sixty days, prior to
the date of any annual meeting or special meeting as the record date for the
determination of shareholders entitled to notice of, or to vote at, such meeting
(the "Meeting Record Date"). In the case of any Demand Special Meeting, (i) the
Meeting Record Date shall be not later than the 30th day after the Delivery Date
and (ii) if the Board of Directors fails to fix the Meeting Record Date within
30 days after the Delivery Date, then the close of business on such 30th day
shall be the Meeting Record Date. The Board of Directors may also fix in advance
a date as the record date for the purpose of determining shareholders entitled
to take any other action or determining shareholders for any other purpose. Such
record date shall be not more than sixty days prior to the date on which the
particular action, requiring such determination of shareholders, is to be taken.
Except in the case of a Demand Special Meeting, if no record date is fixed, the
record date for the determination of shareholders entitled to notice of or to
vote at a meeting of shareholders shall be the date on which notice of the
meeting is mailed, and the record date for the determination of shareholders for
any other purpose shall be the date on which the Board of Directors adopts the
resolution relating thereto. A determination of shareholders of record entitled
to notice of or to vote at a meeting of shareholders shall apply to any
adjournment of the meeting. Nothing in this Section 6 shall in any way be
construed to change the procedure for setting the record date and for
determining the effectiveness of shareholder action by written consent as set
forth in Section 7 of this Article II.

         SECTION 7. WRITTEN CONSENTS.

                  (a)      In order that the Corporation may determine the
shareholders entitled to consent to corporate action in writing without a
meeting, the Board of Directors may fix a record date (a "Consent Record Date").
The Consent Record Date shall not precede the date upon which the resolution
fixing the Consent Record Date is adopted by the Board of Directors and shall
not be more than 10 days after the date upon which the resolution fixing the
Consent Record Date is adopted by the Board of Directors. Any shareholder of
record seeking to consent to corporate action in writing without a meeting
shall, by sending written notice to the Secretary of the Corporation by hand or
by certified or registered mail, return receipt requested, request the Board of
Directors to fix a Consent Record Date. The Board of Directors shall promptly,
but in all events within 10 days after the date on which a valid request to fix
a Consent Record Date is received, adopt a resolution fixing the Consent Record
Date and shall make a public announcement of such Consent Record Date. If no
Consent Record Date has been fixed by the Board of Directors within 10 days
after the date on which such

                                       27
<PAGE>

request is received by the Secretary, the Consent Record Date shall be the 10th
day after the first date on which a valid written request to set a Consent
Record Date is received by the Secretary. To be valid, such written request
shall set forth the purpose or purposes for which the written consent is sought
to be used, shall be signed by one or more shareholders of record (or their duly
authorized proxies or other representatives), shall bear the date of signature
of each such shareholder (or proxy or other representative) and shall set forth
all information about each such shareholder and about the beneficial owner or
owners, if any, on whose behalf the request is made that would be required to be
set forth in a shareholder's notice described in paragraph (a) of Section 16 of
Article II of these by-laws.

                  (b)      Every written consent shall be signed by one or more
persons who as of the Consent Record Date are shareholders of record on the
Consent Record Date (or their duly authorized proxies or other representatives),
shall bear the date of signature of each such shareholder (or proxy or other
representative), and shall set forth the name and address, as they appear in the
Corporation's books, of each shareholder signing such consent and the class and
number of shares of the Corporation which are owned of record and beneficially
by each such shareholder and shall be sent to the Secretary by hand or by
certified or registered mail, return receipt requested. No written consent shall
be effective to take the corporate action referred to therein unless, within 60
days of the date the earliest dated written consent was received in accordance
with this paragraph (b) of this Section 7, a written consent or consents signed
by a sufficient number of holders to take such action are delivered to the
Corporation.

                  (c)      In the event of the delivery, in the manner provided
by paragraph (b) of this Section 7, to the Corporation of the requisite written
consent or consents to take corporate action and/or any related revocation or
revocations, the Corporation shall engage independent inspectors of elections
for the purpose of promptly performing a ministerial review of the validity of
the consents and revocations. For the purpose of permitting the inspectors to
perform such review, no action by written consent without a meeting shall be
effective until such date as the independent inspectors certify to the
Corporation that the consents represent at least the minimum number of votes
that would be necessary to take the corporate action. Nothing contained in this
paragraph (c) of Section 7 shall in any way be construed to suggest or imply
that the Board of Directors or any shareholder shall not be entitled to contest
the validity of any consent or revocation thereof, whether before or after
certification by the independent inspectors, or to take any other action
(including, without limitation, the commencement, prosecution or defense of any
litigation with respect thereto, and the seeking of injunctive relief in such
litigation).

                                       28
<PAGE>

         SECTION 8. VOTING LISTS. The officer or agent having charge of the
transfer books for shares of the Corporation shall make, at least ten days
before each meeting of shareholders, a complete list of the shareholders
entitled to vote at such meeting, arranged in alphabetical order, showing the
address of and the number of shares registered in the name of the shareholder,
which list, for a period of ten days prior to such meeting, shall be kept on
file at the registered office of the Corporation and shall be open to inspection
by any shareholder for any purpose germane to the meeting, at any time during
usual business hours. Such list shall also be produced and kept open at the time
and place of the meeting and may be inspected by any shareholder during the
whole time of the meeting. The original share ledger or transfer book, or a
duplicate thereof kept in this State, shall be prima facie evidence as to who
are the shareholders entitled to examine such list or share ledger or transfer
book or to vote at any meeting of shareholders.

         SECTION 9. QUORUM. The holders of a majority of the outstanding shares
of the Corporation, present in person or represented by proxy, shall constitute
a quorum at any meeting of shareholders; provided that if less than a majority
of the outstanding shares are represented at said meeting, a majority of the
shares so represented may adjourn the meeting at any time without further
notice. If a quorum is present, the affirmative vote of the majority of the
shares represented at the meeting shall be the act of the shareholders, unless
the vote of a greater number or voting by classes is required by The Business
Corporation Act, the articles of incorporation or these by-laws. The Chairman of
the meeting or the holders of record of a majority of the shares represented at
the meeting shall have the power to adjourn the meeting from time to time,
without notice other than an announcement at the meeting. At any adjourned
meeting at which a quorum shall be present, any business may be transacted which
might have been transacted at the original meeting. Withdrawal of shareholders
from any meeting shall not cause failure of a duly constituted quorum at that
meeting.

         SECTION 10. VOTING BY BALLOT. Voting on any question or in any election
may be by voice unless the presiding officer shall order or any shareholder
shall demand that voting be by ballot.

         SECTION 11. PROXIES. Each shareholder shall have one vote for each
share of stock having voting power and entitled to vote, registered in his name
on the books of the Corporation, and at all meetings of the shareholders,
shareholders may vote either in person or by proxy executed in writing by the
shareholders, or by a duly authorized attorney. No proxy shall be valid after
eleven months from the date of its execution, except where the stock is pledged
as security for a debt to the person holding the proxy.

                                       29
<PAGE>

         SECTION 12. VOTING OF SHARES. Each outstanding share, regardless of
class, shall be entitled to one vote upon each matter submitted to vote at a
meeting of shareholders.

         SECTION 13. VOTING OF SHARES BY CERTAIN HOLDERS. Shares outstanding in
the name of another corporation, domestic or foreign, may be voted by such
officer, agent, or proxy as the by-laws of such corporation may prescribe, or,
in the absence of such provision, as the Board of Directors of such corporation
may determine.

Shares outstanding in the name of a deceased person, a minor ward, or an
incompetent person, may be voted by his administrator, executor, court appointed
guardian, or conservator or custodian under a Gift to Minors Act, either in
person or by proxy without a transfer of such shares into the name of such
administrator, executor, court appointed guardian, or conservator. Shares
outstanding in the name of a trustee may be voted by him, either in person or by
proxy.

Shares outstanding in the name of a receiver may be voted by such receiver, and
shares held by or under the control of a receiver may be voted by such receiver
without the transfer thereof into his name if authority so to do be contained in
an appropriate order of the court by which such receiver was appointed.

A shareholder whose shares are pledged shall be entitled to vote such shares
until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.

Any number of shareholders may create a voting trust for the purpose of
conferring upon a trustee or trustees the right to vote or otherwise represent
their share, for a period not to exceed ten years, by entering into a written
voting trust agreement specifying the terms and conditions of the voting trust,
and by transferring their shares to such trustee or trustees for the purpose of
the agreement. Any such trust agreement shall not become effective until a
counterpart of the agreement is deposited with the Corporation at its registered
office. The counterpart of the voting trust agreement so deposited with the
Corporation shall be subject to the same right of examination by a shareholder
of the Corporation, in person or by agent or attorney, as are the books and
records of the Corporation, and shall be subject to examination by any holder of
a beneficial interest in the voting trust, either in person or by agent or
attorney, at any reasonable time for any proper purpose.

Shares of its own stock belonging to this Corporation shall not be voted,
directly or indirectly, at any meeting and shall not be counted in determining
the total number of outstanding shares at any given time, but shares of its own
stock held by it in a fiduciary

                                       30
<PAGE>

capacity may be voted and shall be counted in determining the total number of
outstanding shares at any given time.

         SECTION 14. CUMULATIVE VOTING. In all elections for directors, every
shareholder shall have the right to vote, in person or by proxy, the number of
shares owned by him, for as many persons as there are directors to be elected,
or to cumulate said shares, and give one candidate as many votes as the number
of directors multiplied by the number of his shares shall equal, or to
distribute them on the same principle among as many candidates as he shall see
fit.

         SECTION 15. INSPECTORS. At any meeting of shareholders, the presiding
officer may, or upon the request of any shareholder shall appoint one or more
persons as inspectors for such meeting.

Such inspectors shall ascertain and report the number of shares represented at
the meeting, based upon their determination of the validity and effect of
proxies; count all votes and report the results; and do such other acts as are
proper to conduct the election and voting with impartiality and fairness to all
the shareholders.

Each report of an inspector shall be in writing and signed by him or by a
majority of them if there be more than one inspector acting at such meeting. If
there is more than one inspector, the report of a majority shall be the report
of the inspectors. The report of the inspector or inspectors on the number of
shares represented at the meeting and the results of the voting shall be prima
facie evidence thereof.

         SECTION 16. NOTICE OF SHAREHOLDER NOMINATIONS AND BUSINESS PROPOSALS.
(a) Shareholder Nominations. Only persons who are nominated in accordance with
the following procedures shall be eligible for election as directors of the
Corporation, except as may be otherwise provided in the Articles of
Incorporation of the Corporation. Nominations of persons for election to the
Board of Directors may be made at any annual meeting of shareholders (i) by or
at the direction of the Board of Directors (or any duly authorized committee
thereof) or (ii) by any shareholder of the Corporation (A) who is a shareholder
of record on the date of the giving of the notice provided for in this Section
16(a) and on the record date for the determination of shareholders entitled to
vote at such annual meeting and (B) who complies with the notice procedures set
forth in this Section 16(a).

In addition to any other applicable requirements, for a nomination to be made by
a shareholder, such shareholder must have given timely notice thereof in proper
written form to the Secretary of the Corporation.

                                       31
<PAGE>

To be timely, a shareholder's notice to the Secretary must be delivered to or
mailed and received at the principal executive offices of the Corporation not
less than ninety (90) days nor more than one hundred twenty (120) days in
advance of the anniversary date of the mailing of the Corporation's proxy
statement in connection with the previous year's annual meeting; provided,
however, that in the event that the date of the applicable annual meeting has
been changed by more than 30 days from the date contemplated at the time of the
previous year's proxy statement, notice by the shareholder in order to be timely
must be so received not later than the close of business on the tenth (10th) day
following the day on which notice of the date of the annual meeting was mailed
or public announcement of the date of the annual meeting was made, whichever
first occurs. In no event shall the public announcement of an adjournment of an
annual meeting commence a new time period for the giving of a shareholder's
notice as described above.

To be in proper written form, a shareholder's notice to the Secretary must set
forth (i) as to each person whom the shareholder proposes to nominate for
election as a director (A) the name, age, business address and residence address
of the person, (B) the principal occupation or employment of the person, (C) the
class or series and number of shares of capital stock of the Corporation which
are owned beneficially or of record by the person and (D) any other information
relating to the person that would be required to be disclosed in a proxy
statement or other filings required to be made in connection with solicitations
of proxies for election of directors pursuant to Section 14 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and
regulations promulgated thereunder; and (ii) as to the shareholder giving the
notice (A) the name and record address of such shareholder, (B) the class or
series and number of shares of capital stock of the Corporation which are owned
beneficially or of record by such shareholder, (C) a description of all
arrangements or understandings between such shareholder and each proposed
nominee and any other person or persons (including their names) pursuant to
which the nomination(s) are to be made by such shareholder, (D) a representation
that such shareholder intends to appear in person or by proxy at the meeting to
nominate the persons named in its notice and (E) any other information relating
to such shareholder that would be required to be disclosed in a proxy statement
or other filings required to be made in connection with solicitations of proxies
for election of directors pursuant to Section 14 of the Exchange Act and the
rules and regulations promulgated thereunder. Such notice must be accompanied by
a written consent of each proposed nominee to being named as a nominee and to
serve as a director if elected.

No person shall be eligible for election as a director of the Corporation unless
nominated in accordance with the procedures set forth in this Section 16(a). If
the Chairman of the meeting

                                       32
<PAGE>

determines that a nomination was not made in accordance with the foregoing
procedures, the Chairman shall declare to the meeting that the nomination was
defective and such defective nomination shall be disregarded.

Notwithstanding anything in the third paragraph of this Section 16(a) to the
contrary, in the event that the number of directors to be elected to the Board
of Directors of the Corporation is increased and there is no public announcement
by the Corporation naming all of the nominees for director or specifying the
size of the increased board of directors at least one hundred (100) days prior
to the first anniversary of the preceding year's annual meeting, a shareholder's
notice required by this Section 16(a) shall also be considered timely, but only
with respect to nominees for any new positions created by such increase, if it
shall be delivered to the Secretary at the principal executive offices of the
Corporation not later than the close of business on the tenth (10th) day
following the day on which such public announcement is first made by the
Corporation.

                  (b)      Shareholder Business Proposals. No business may be
transacted at an annual meeting of shareholders, other than business that is
either (i) specified in the notice of meeting (or any supplement thereto) given
by or at the direction of the Board of Directors (or any duly authorized
committee thereof), (ii) otherwise properly brought before the annual meeting by
or at the direction of the Board of Directors (or any duly authorized committee
thereof) or (iii) otherwise properly brought before the annual meeting by any
shareholder of the Corporation (A) who is a shareholder of record on the date of
the giving of the notice provided for in this Section 16(b) and on the record
date for the determination of shareholders entitled to vote at such annual
meeting and (B) who complies with the notice procedures set forth in this
Section 16(b).

In addition to any other applicable requirements, for business to be properly
brought before an annual meeting by a shareholder, such shareholder must have
given timely notice thereof in proper written form to the Secretary of the
Corporation.

To be timely, a shareholder's notice to the Secretary must be delivered to or
mailed and received at the principal office of the Corporation not less than
ninety (90) days nor more than one hundred twenty (120) days in advance of the
anniversary date of the mailing of the Corporation's proxy statement in
connection with the previous year's annual meeting; provided, however, that in
the event that the date of the applicable annual meeting has been changed by
more than 30 days from the date contemplated at the time of the previous year's
proxy statement, notice by the shareholder in order to be timely must be so
received not later than the close of business on the tenth (10th) day following
the day on which notice of the date of the annual meeting

                                       33
<PAGE>

was mailed or public announcement of the date of the annual meeting was made,
whichever first occurs. In no event shall the public announcement of an
adjournment of an annual meeting commence a new time period for the giving of a
shareholder's notice as described above.

To be in proper written form, a shareholder's notice to the Secretary must set
forth as to each matter such shareholder proposes to bring before the annual
meeting (i) a brief description of the business desired to be brought before the
annual meeting and the reasons for conducting such business at the annual
meeting, (ii) the name and record address of such shareholder, (iii) the class
or series and number of shares of capital stock of the Corporation which are
owned beneficially or of record by such shareholder, (iv) a description of all
arrangements or understandings between such shareholder and any other person or
persons (including their names) in connection with the proposal of such business
by such shareholder and any material interest of such shareholder in such
business and (v) a representation that such shareholder intends to appear in
person or by proxy at the annual meeting to bring such business before the
meeting.

No business shall be conducted at the annual meeting of shareholders except
business brought before the annual meeting in accordance with the procedures set
forth in this Section 16(b); provided, however, that, once business has been
properly brought before the annual meeting in accordance with such procedures,
nothing in this Section 16(b) shall be deemed to preclude discussion by any
shareholder of any such business. If the Chairman of an annual meeting
determines that business was not properly brought before the annual meeting in
accordance with the foregoing procedures, the Chairman shall declare to the
meeting that the business was not properly brought before the meeting and such
business shall not be transacted.

                  (c)      For purposes of this Section 16, "public
announcement" shall mean an announcement in a press release reported by the Dow
Jones News Service, Associated Press or comparable national news service or in a
document publicly filed by the Corporation with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

                                  ARTICLE III
                               BOARD OF DIRECTORS

         SECTION 1. GENERAL POWERS. The business of the Corporation shall be
managed by its Board of Directors.

SECTION 2. NUMBER, TENURE AND QUALIFICATIONS. The number of directors of the
Corporation shall be seven(7), provided however, that effective as of the
Company's 2004 annual meeting of shareholders, the number of directors shall be
increased to nine (9). Each director shall hold office until the next annual
meeting

                                       34
<PAGE>

of shareholders or until his successor shall have been elected and qualified.
Directors need not be residents of Illinois or shareholders of the Corporation.
The number of directors may be increased or decreased from time to time by the
amendment of this section; but no decreases shall have the effect of shortening
the term of any incumbent director.

         SECTION 3. REGULAR MEETINGS. Immediately after the adjournment of the
annual meeting of the shareholders of the Corporation, the newly elected
directors shall meet for the purpose of organization, the election of officers
and the transaction of such other business as may properly come before the
meeting. Other regular meetings shall be held at such time as shall from time to
time be determined by the Board.

         SECTION 4. SPECIAL MEETINGS. Special meetings of the Board of Directors
shall be held whenever called by the President or by a majority of the
directors.

         SECTION 5. NOTICE. Notice of any special meeting shall be given, at
least 24 hours previous thereto to each director personally by telegraph,
telephone, facsimile transmission or by written notice duly served on each
director, or sent or mailed to each director at his business address. If notice
of any special meeting is to be given less than five days prior to such meeting,
notice shall be by means of telegraph, telephone, facsimile transmission or
overnight courier. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail so addressed, with postage thereon prepaid.
If notice be given by telegram, such notice shall be deemed to be delivered when
the telegram is delivered to the telegram company. The attendance of a director
at any meeting shall constitute a waiver of notice of such meeting, except where
a director attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the Board of Directors need be specified in the
notice or waiver of notice of such meeting.

         SECTION 6. PLACE OF MEETINGS. Regular and Special Meetings of the Board
of Directors shall be held at the Registered Office of the Corporation, or any
such other place, either within or without the State of Illinois, as may from
time to time be determined by the Board of Directors.

         SECTION 7. QUORUM OF DIRECTORS - MANNER OF ACTING. A majority of the
number of directors fixed by the by-laws, or in the absence of a by-law fixing
the number of directors, then of the number stated in the articles of
incorporation, shall constitute a quorum for the transaction of business unless
the greater number is required by the articles of incorporation or the by-laws.
The act of the majority of the directors present at a meeting at which a quorum

                                       35
<PAGE>

is present shall be the act of the Board of Directors, unless the act of a
greater number is required by statute, these by-laws, or the articles or
incorporation.

         SECTION 8. VACANCIES. Any vacancy occurring in the Board of Directors
and any directorship to be filled by reason of an increase in the number of
directors, may be filled by election at an annual meeting or at a special
meeting of shareholders called for that purpose. A director elected to fill a
vacancy shall be elected for the unexpired term of his predecessor in office.

         SECTION 9. ACTION WITHOUT A MEETING. Unless specifically prohibited by
the articles of incorporation or by-laws, any action required to be taken at a
meeting of the Board of Directors, or any other action which may be taken at a
meeting of the Board of Directors, or of any committee thereof may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all the directors entitled to vote with respect to the
subject matter thereof, or by all the members of such committee, as the case may
be. Any such consent signed by all the directors or all the members of the
committee shall have the same effect as a unanimous vote, and may be stated as
such in any document filed with the Secretary of State or with anyone else.

         SECTION 10. PRESUMPTION OF ASSENT. A director of the Corporation who is
present at a meeting of the Board of Directors at which action on any corporate
matter is taken shall be conclusively presumed to have assented to the action
taken unless his dissent shall be entered in the minutes of the meeting or
unless he shall file his written dissent to such action with the person acting
as the secretary of the meeting before the adjournment thereof or shall forward
such dissent by registered mail to the secretary of the Corporation immediately
after the adjournment of the meeting. Such right to dissent shall not apply to a
director who voted in favor of such action.

         SECTION 11. EXECUTIVE COMMITTEE. The Board of Directors, by resolution
adopted by a majority of the number of directors fixed by the by-laws or
otherwise, may appoint an executive committee, which committee, to the extent
provided in such resolution, shall have and exercise all of the authority of the
Board of Directors in the management of the Corporation, except as otherwise
required by law. Vacancies in the membership of the committee shall be filled by
the Board of Directors at a regular or special meeting of the Board of
Directors. The executive committee shall keep regular minutes of its proceedings
and report the same to the board when required.

         SECTION 12. COMMITTEES. The Board of Directors may from its membership
appoint other committees as it may from time to time by resolution determine and
fix the number of members thereof, and the board may delegate to such committees
such of the powers

                                       36
<PAGE>

vested in it as it may by the resolution of appointment determine. Such
committees so appointed shall observe such rules and regulations for their
conduct and keep such records as the board may from time to time by resolution
determine.

         SECTION 13. COMPENSATION. The Board of Directors, by the affirmative
vote of a majority of the acting and qualified directors, and notwithstanding
any personal interest of any director, shall have authority to establish
reasonable compensation of all directors for services to the Corporation as
directors, officers or otherwise. By resolution of the Board of Directors, the
directors may be paid their expenses of attending each meeting of the board.

         SECTION 14. INDEMNIFICATION. (a) Generally. Each person who was or is
made a party or is threatened to be made a party to or is involved in or called
as a witness in any action, suit or proceeding, whether civil, criminal,
administrative or investigative, and any appeal therefrom (hereinafter,
collectively a "proceeding"), by reason of the fact that he or she, or a person
of whom he or she is the legal representative, is, was or had agreed to become a
director of the Corporation or is, was or had agreed to become an officer of the
Corporation or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise, including service with respect to
employee benefit plans, shall be indemnified and held harmless by the
Corporation to the fullest extent permitted under the Illinois Business
Corporation Act of 1983 (the "IBCA"), as the same now exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such
amendment permits the Corporation to provide broader indemnification rights than
the IBCA permitted the Corporation to provide prior to such amendment), against
all expenses, liabilities and losses (including attorneys' fees, judgments,
fines, excise taxes or penalties pursuant to the Employee Retirement Income
Security Act of 1974, as amended, and amounts paid or to be paid in settlement)
reasonably incurred or suffered by such person in connection therewith; provided
that, except as explicitly provided herein, prior to a Change in Control of the
Corporation, as defined herein, a person seeking indemnity in connection with a
proceeding (or part thereof) initiated by such person against the Corporation or
any director, officer, employee or agent of the Corporation shall not be
entitled thereto unless the Corporation has joined in or consented to such
proceeding (or part thereof). For purposes of this Section 14, a "Change in
Control of the Corporation" shall be deemed to have occurred if the conditions
set forth in any one of the following clauses shall have been satisfied: (i) any
"person" (as such term is used in Section 13(d) and 14(d) of the Exchange Act)
other than (A) the Corporation, (B) a trustee or other fiduciary holding
securities under an employee benefit plan of the Corporation, (C) an underwriter
temporarily holding securities pursuant to an offering of such securities, or
(D) a corporation

                                       37
<PAGE>

owned, directly or indirectly, by the shareholders of the Corporation in
substantially the same proportions as their ownership of shares of the
Corporation (any such person is hereinafter referred to as a "Person"), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Corporation representing more
than 50% of the combined voting power of the Corporation's then outstanding
securities (not including in the securities beneficially owned by such Person
any securities acquired directly from the Corporation); (ii) there is
consummated a merger or consolidation of the Corporation with or into any other
corporation, other than a merger or consolidation which would result in the
holders of the voting securities of the Corporation outstanding immediately
prior thereto holding securities which represent, in combination with the
ownership of any trustee or other fiduciary holding securities under an employee
benefit plan of the Corporation, immediately after such merger or consolidation,
more than 70% of the combined voting power of the voting securities of either
the Corporation or the other entity which survives such merger or consolidation
or the parent of the entity which survives such merger or consolidation; (iii)
the shareholders of the Corporation approve any plan or proposal for the
liquidation or dissolution of the Corporation or an agreement for the sale or
disposition by the Corporation of all or substantially all the Corporation's
assets; or (iv) during any period of two consecutive years (not including any
period prior to January 1, 1997), individuals who at the beginning of such
period constitute the Board of Directors and any new director (other than a
director designated by a Person who has entered into an agreement with the
Corporation to effect a transaction described in clause (i), (ii) or (iii) of
this paragraph) whose election by the board or nomination for election by the
Corporation's shareholders was approved by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors at the beginning
of the period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof. For purposes of
this Section 14, where a Change in Control of the Corporation results from a
series of related transactions, the Change in Control of the Corporation shall
be deemed to have occurred on the date of the consummation of the first such
transaction. For purposes of clause (i) of this paragraph, the shareholders of
another corporation (other than this Corporation or a corporation described in
clause (i)(D) of this paragraph), in the aggregate, shall be deemed to
constitute a Person.

Prior to a Change in Control of the Corporation, any indemnification under this
Section 14(a) (unless ordered by a court) shall be made by the Corporation only
as authorized in the specific case upon a determination that indemnification of
the director, officer, employee or agent is proper in the circumstances because
he or she has met the applicable standard of conduct set forth in the IBCA. Such
determination shall be made (i) by the Board of Directors by a majority vote of
a quorum consisting of directors who were not

                                       38
<PAGE>

parties to such action, suit or proceeding, or (ii) if such quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested directors so
directs, by independent legal counsel (who may be the regular counsel of the
Corporation) in a written opinion or (iii) by the shareholders.

Following a Change in Control of the Corporation, any indemnification under this
Section 14(a) (unless ordered by a court) shall be paid by the Corporation
unless within 60 days of such request for indemnification a determination is
made, in a written opinion, by special independent counsel selected by the
person requesting indemnification and approved by the Corporation (which
approval shall not be unreasonably withheld), which counsel has not otherwise
performed services (other than in connection with similar matters) within the
five years preceding its engagement to render such opinion for such person or
for the Corporation or any affiliates (as such term is defined in Rule 405 under
the Securities Act of 1933, as amended) of the Corporation (whether or not they
were affiliates when services were so performed) ("Independent Counsel"), that
indemnification of such person is not proper under the circumstances because
such person has not met the necessary standard of conduct under the IBCA. Unless
such person has theretofore selected Independent Counsel pursuant to this
Section 14(a) and such Independent Counsel has been approved by the Corporation,
legal counsel approved by a resolution or resolutions of the Board of Directors
prior to a Change in Control of the Corporation shall be deemed to have been
approved by the Corporation as required. Such Independent Counsel shall
determine as promptly as practicable whether and to what extent such person
would be permitted to be indemnified under applicable law and shall render its
written opinion to the Corporation and such person to such effect. The
Corporation agrees to pay the reasonable fees of the Independent Counsel
referred to above and to fully indemnify such Independent Counsel against any
and all expenses, claims, liabilities and damages arising out of or relating to
this Section 14 or its engagement pursuant hereto. In making a determination
under this Section 14(a), the Independent Counsel referred to above shall
determine that indemnification is permissible unless clearly precluded by this
Section 14 or the applicable provisions of the IBCA.

                  (b)      Payment of Expenses in Advance. Expenses, including
attorneys' fees, incurred by a person referred to in Subsection (a) of this
Section 14 in defending a proceeding shall be paid by the Corporation in advance
of the final disposition of such proceeding, including any appeal therefrom,
upon receipt of an undertaking (the "Undertaking") by or on behalf of such
person to repay such amount if it shall ultimately be determined that he or she
is not entitled to be indemnified by the Corporation.

                  (c)      Right of Claimant to Bring Suit. If a claim under
Subsection (a) of this Section 14 is not paid in full by

                                       39
<PAGE>

the Corporation within 60 days after a written claim has been received by the
Corporation or if expenses pursuant to Subsection (b) of this Section 14 hereof
have not been advanced within 10 days after a written request for such
advancement, accompanied by the Undertaking, has been received by the
Corporation, the claimant may at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim or the advancement of
expenses. (If the claimant is successful, in whole or in part, in such suit or
any other suit to enforce a right for expenses or indemnification against the
Corporation or any other party under any other agreement, such claimant shall
also be entitled to be paid the reasonable expense of prosecuting such claim.)
It shall be a defense to any such action (other than an action brought to
enforce a claim for expenses incurred in defending any proceeding in advance of
its final disposition where the required Undertaking has been tendered to the
Corporation) that the claimant has not met the standards of conduct which make
it permissible under the IBCA for the Corporation to indemnify the claimant for
the amount claimed. After a Change in Control of the Corporation, the burden of
proving such defense shall be on the Corporation, and any determination by the
Corporation (including its Board of Directors, independent legal counsel or its
shareholders) that the claimant had not met the applicable standard of conduct
required under the IBCA shall not be a defense to the action nor create a
presumption that claimant had not met such applicable standard of conduct.

                  (d)      Indemnity Not Exclusive. The indemnification and
advancement of expenses provided by, or granted pursuant to, the other
Subsections of this Section 14 shall not be deemed exclusive of any other rights
to which those seeking indemnification or advancement of expenses may be
entitled under any statute, by-law, agreement, vote of shareholders or
disinterested directors or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office. The
Board of Directors shall have the authority, by resolution, to provide for such
other indemnification of directors, officers, employees or agents as it shall
deem appropriate.

                  (e)      Insurance. The Corporation shall have power to
purchase and maintain insurance to protect itself and any director, officer,
employee or agent of this Corporation or another Corporation, partnership, joint
venture, trust or other enterprise, against any expenses, liabilities or losses,
whether or not the Corporation would have the power to indemnify such person
against such expenses, liabilities or losses under the provisions of this
Section 14 or the IBCA.

                  (f)      Continuation of Indemnification; Enforceability. The
provisions of this Section 14 shall be applicable to all proceedings commenced
after its adoption, whether such proceedings arise out of events, acts,
omissions or circumstances which occurred or existed prior or subsequent to such

                                       40
<PAGE>

adoption, and shall, unless otherwise provided when authorized or ratified,
continue as to a person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of the heirs, executors and administrators
of such person. This Section 14 shall be deemed to grant each person who, at any
time that this Section 14 is in effect, serves or agrees to serve in any
capacity which entitles him to indemnification hereunder rights against the
Corporation to enforce the provisions of this Section 14, and any repeal or
other modification of this Section 14 or any repeal or modification of the IBCA
or any other applicable law shall not limit any rights of indemnification then
existing or arising out of events, acts, omissions or circumstances occurring or
existing prior to such repeal or modification, including, without limitation,
the right to indemnification for proceedings commenced after such repeal or
modification to enforce this Section 14 with regard to acts, omissions, events
or circumstances occurring or existing prior to such repeal or modification.

                  (g)      Severability. If this Section 14 or any portion
hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Corporation shall nevertheless indemnify each director
and officer of the Corporation as to costs, charges and expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement with respect
to any proceeding, whether civil, criminal, administrative or investigative,
including an action by or in the right of the Corporation, to the full extent
permitted by any applicable portion of this Section 14 that shall not have been
invalidated and to the full extent permitted by applicable law.

                                   ARTICLE IV
                        OFFICERS AND DEFINITION OF DUTIES

         SECTION 1. OFFICERS - REMOVAL. The officers of this Corporation shall
consist of a Chairman of the Board, a President, one or more Vice-Presidents, a
Secretary and a Treasurer, and such other officers, including one or more
Assistant Secretaries and one or more Assistant Treasurers, as the Board of
Directors may from time to time determine. In addition, the Board of Directors
may from time to time elect a Vice Chairman and an Executive Vice President if
it so determines. Such officers, when elected, shall hold office for the period
of one year and thereafter until their respective successors shall have been
duly elected, and shall have qualified; provided, however, that all officers,
agents and employees of the Corporation shall be subject to removal at any time
by the affirmative vote by a majority of the Board. Any one person may hold two
offices at the same time, except that the same person shall not hold at the same
time the office of Chairman of the Board and Secretary, President and Vice
President, President and Secretary, Treasurer and Assistant Treasurer, or
Secretary and Assistant Secretary.

                                       41
<PAGE>

         SECTION 2. VACANCIES. If any vacancy shall occur among the officers of
the Corporation, by resignation or otherwise, such vacancy may be filled by the
Board of Directors.

         SECTION 3. CHAIRMAN OF THE BOARD. The Chairman of the Board shall
supervise and control the officers, policies and programs of the Corporation.
The Chairman shall preside at all meetings of the Board of Directors and
shareholders. The Chairman shall initiate acquisition, merger and investment
banking activities. The Chairman, from time to time, may delegate powers and
duties to the Vice-Chairman, President and other officers. The Chairman shall
possess the power to sign all certificates, contracts and other instruments of
the Corporation as authorized by the Board of Directors. In the event of the
absence, inability to act or disability of the President, the Chairman shall
exercise all powers and discharge all duties of the President. The Chairman
shall possess such other duties and powers as may be prescribed from time to
time by the Board of Directors and the by-laws.

         SECTION 4. VICE-CHAIRMAN OF THE BOARD. The Vice Chairman of the Board,
if elected, and in the event of the absence, inability to act or disability of
the Chairman, shall carry out the responsibilities of the Chairman. The Vice-
Chairman when so acting shall exercise the powers and discharge the duties of
the Chairman, including presiding at meetings of shareholders and the Board of
Directors. The Vice-Chairman shall possess such other duties and powers as may
be prescribed from time to time by the Board of Directors, Chairman and by-laws.
In the event of the absence, inability to act or disability of the Chairman and
Vice-Chairman, the Board of Directors shall elect an acting Chairman.

         SECTION 5. PRESIDENT. The President shall be the chief operating
officer of the Corporation. The President shall conduct the daily business and
affairs of the Corporation as so authorized by the by-laws. The President may
delegate powers and duties to the Vice-Presidents or other officers. The
President shall have the power to sign all certificates, contracts, and other
instruments of the Corporation as authorized by the Board of Directors. The
President shall perform such other duties as may be prescribed from time to time
by the Board of Directors, Chairman and by-laws. In the event of the absence,
inability to act or disability of the Chairman, Vice-Chairman and acting
Chairman, the President shall preside at meetings of shareholders and the Board
of Directors.

         SECTION 6. THE EXECUTIVE VICE PRESIDENT. In the absence of, or in the
case of the inability of the Chairman of the Board or the Vice Chairman (in the
absence of the Chairman), and the President to act, the Executive Vice
President, if one be elected by the Board, shall perform all duties and have the
powers of the President. The Executive Vice President shall, in addition,
perform

                                       42
<PAGE>

such other duties and have such other powers as the Board of Directors may, from
time to time, by resolution determine.

         SECTION 7. OTHER VICE PRESIDENTS. Other Vice Presidents, including one
or more Senior Vice Presidents, if such officers shall have been elected, shall
perform such duties and have such duties and powers as the Board of Directors
may from time to time by resolution determine, or, in the absence of such
determination, as the President, with the consent of the Chairman or Vice
Chairman, shall determine.

         SECTION 8. THE TREASURER. The Treasurer shall be the principal
accounting and financial officer of the Corporation. He shall: (a) have charge
of and be responsible for the maintenance of adequate books of account for the
Corporation; (b) have charge and custody of all funds and securities of the
Corporation; and be responsible therefor and for the receipt and disbursement
thereof; and (c) perform all the duties incident to the office of treasurer and
such other duties as from time to time may be assigned to him by the President
or by the Board of Directors. If required by the Board of Directors, the
Treasurer shall give a bond for the faithful discharge of his duties in such sum
and with such surety or sureties as the Board of Directors may determine.

         SECTION 9. THE SECRETARY. The Secretary shall: (a) record the minutes
of the shareholders' and of the Board of Directors' meetings in one or more
books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these by-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the Corporation; (d) keep
a register of the post-office address of each shareholder which shall be
furnished to the secretary by such shareholder; (e) sign with the President, or
a Vice President, or any other officer thereunto authorized by the Board of
Directors, certificates for shares of the Corporation, the issue of which shall
have been authorized by the Board of Directors, and any contracts, deeds,
mortgages, bonds, or other instruments which the Board of Directors has
authorized to be executed, according to the requirement of the form of the
instrument, except when a different mode of execution is expressly prescribed by
the Board of Directors or these by-laws; (f) have general charge of the stock
transfer books of the Corporation and (g) perform all duties incident to the
office of secretary and such other duties as from time to time may be assigned
to him by the President or by the Board of Directors.

         SECTION 10. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES. The
Assistant Treasurers and Assistant Secretaries shall perform such duties as
shall be assigned to them by the Treasurer or the Secretary, respectively, or by
the President or the Board of Directors. The Assistant Secretaries may sign with
the President, or a Vice President, or any other officer thereunto authorized by
the Board of Directors, certificates for shares of the

                                       43
<PAGE>

Corporation, the issue of which shall have been authorized by the Board of
Directors, and any contracts, deeds, mortgages, bonds or other instruments which
the Board of Directors has authorized to be executed, according to the
requirements of the form of the instrument, except when a different mode of
execution is expressly prescribed by the Board of Directors or these by-laws.
The assistant treasurers shall respectively, if required by the Board of
Directors, give bonds for the faithful discharge of their duties in such sums
and with sureties as the Board of Directors shall determine.

         SECTION 11. SALARIES. The salaries of the officers shall be fixed from
time to time by the Board of Directors and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
Corporation.

                                   ARTICLE V
                   SHARES OF CAPITAL STOCK AND THEIR TRANSFER

         SECTION 1. STOCK ISSUE. Whenever stock, not previously reported to the
Secretary of State as issued, has been issued within the authorized limit fixed
by the statement of incorporation of a certificate of increase in capital stock,
a statement subscribed and sworn to by the President or any Vice President, and
attested by the Secretary or by an Assistant Secretary shall be filed in the
office of the Secretary of State within ninety days after the issuance of such
additional stock pursuant to authorization thereof by the Board of Directors in
the form prescribed by the General Corporation Act of the State of Illinois.
Promissory notes shall not be accepted for payment or part payment of stock
issued by this Corporation.

         SECTION 2. CERTIFICATES. Each shareholder shall be entitled to a
certificate of stock, executed by the President or Vice President and the
Secretary or Assistant Secretary, and under the corporate seal, certifying the
number of shares owned by him in such Corporation. When such certificate is
countersigned by a transfer agent other than the Corporation itself, or an
employee of the Corporation, or by a transfer clerk and registered by a
registrar, the signatures of the President or Vice President and the Secretary
or Assistant Secretary upon such certificates may be facsimiles, engraved or
printed.

         SECTION 3. TRANSFERS. Transfers of shares of capital stock shall be
made only upon the books of the Corporation by the holder in person or by power
of attorney, duly executed, and filed with the Secretary, and on surrender of a
certificate or certificates for such shares.

         SECTION 4. ADDRESSES. Every shareholder shall furnish the Secretary
with his address, at which notice of meetings

                                       44
<PAGE>

and all other notices may be served upon, or mailed to him. In default thereof,
notices may be addressed to him at the principal office of the Corporation.

         SECTION 5. LOST CERTIFICATES. The Chairman or President, as officers of
the Company, acting singly, may direct new certificates of stock to be issued in
the place of certificates theretofore issued, alleged to have been lost or
destroyed, and may, in their discretion, require the owner of such certificate
or certificates, or his legal representative, to give the Corporation a bond in
such sum as they may direct, as indemnity against any claim that may be made
against the Corporation. Said officers may issue instructions to the Transfer
Agents and Registrars of the capital stock of the Company, may enter into such
agreements and may sign such documents as may be necessary to effectuate the
issuance of said certificates. Said officers, however, may refuse to issue or
direct the issuance of any new certificates except upon institution of legal
proceedings as required by statute, in such case made and provided.

                                   ARTICLE VI
                                    DIVIDENDS

         SECTION 1. DECLARATION. Dividends may be declared by the Board of
Directors from time to time out of the surplus or net profits of the
Corporation, and shall be payable at such times as the Board of Directors may
determine.

         SECTION 2. RESERVES. Before payment of any dividend or making any
distribution of profits, there may be set aside out of the surplus or net
profits of the Corporation such sum or sums as the Directors from time to time,
in their absolute discretion, think proper as a reserve fund to meet
contingencies, or for equalizing dividends, or for repairing or maintaining any
property of the Corporation, or for such other purposes as the Directors shall
think conducive to the interests of the Corporation.

                                  ARTICLE VII
                                      SEAL

The corporate seal is and until otherwise ordered by the Board of Directors,
shall be, an impression bearing the corporate name and the words "corporate
seal" and "Illinois."

                                       45
<PAGE>

                                  ARTICLE VIII
                                   FISCAL YEAR

The fiscal year of the Corporation shall begin on the first day of January and
end on the 31st day of December of each year.

                                   ARTICLE IX
                               INSPECTION OF BOOKS

The books kept for transferring stock and the names and addresses of the
shareholders, during the usual business hours shall be open to examination for
all proper purposes by every shareholder, at its principal office or place of
business in the State of Illinois. Each shareholder of the Corporation shall
have the right, at all reasonable times, by himself or by his attorney, to
examine the records and books of account.

                                   ARTICLE X
                                WAIVER OF NOTICE

Whenever any action is to be taken after notice either to the shareholders or
directors, or after the lapse of a prescribed period of time, such action may be
taken without notice and without the lapse of such prescribed period of time, if
such action be taken while all persons interested are present, and consenting
thereto or be authorized or approved or such requirement be waived in writing by
each person interested and entitled to notice, or by his attorney thereto
authorized.

                                   ARTICLE XI
                                   AMENDMENTS

These by-laws may be altered, amended or repealed by the affirmative vote of a
majority of the Board of Directors at any regular or special meeting of the
Board.

                                       46

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-13
<SEQUENCE>4
<FILENAME>c83813exv13.txt
<DESCRIPTION>ANNUAL REPORT TO SHAREHOLDERS
<TEXT>
<PAGE>

                                   EXHIBIT 13

                                       47
<PAGE>

                              [CHICAGO RIVET LOGO]
                          Chicago Rivet & Machine Co.
                               2003 Annual Report
<PAGE>
                                                                               .
                                                                               .
                                                                               .

[CHICAGO RIVET LETTERHEAD]
- --------------------------------------------------------------------------------

HIGHLIGHTS

<Table>
<Caption>
- ------------------------------------------------------------------------------------------
                                                    2003           2002           2001
- ------------------------------------------------------------------------------------------
<S>                                              <C>            <C>            <C>
NET SALES AND LEASE REVENUE....................  $38,190,908    $43,012,766    $40,443,010
NET INCOME.....................................      817,527      2,604,075      1,792,270
NET INCOME PER SHARE...........................          .85           2.69           1.85
DIVIDENDS PER SHARE............................          .97            .87            .97
NET CASH PROVIDED BY OPERATING ACTIVITIES......    3,810,415      4,008,006      5,287,476
EXPENDITURES FOR PROPERTY, PLANT AND
  EQUIPMENT....................................      641,715        886,009      1,431,698
WORKING CAPITAL................................   14,020,185     12,874,182     11,616,424
TOTAL SHAREHOLDERS' EQUITY.....................   23,989,484     24,109,105     22,372,924
COMMON SHARES OUTSTANDING AT YEAR-END..........      966,132        966,132        967,132
SHAREHOLDERS' EQUITY PER COMMON SHARE..........        24.83          24.95          23.13
</Table>

ANNUAL MEETING

The annual meeting of shareholders
will be held on May 11, 2004 at 10:00 a.m. at
901 Frontenac Road
Naperville, Illinois

- --------------------------------------------------------------------------------
<PAGE>

MANAGEMENT'S REPORT
ON FINANCIAL CONDITION AND RESULTS OF OPERATIONS            [CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------

TO OUR SHAREHOLDERS:

RESULTS OF OPERATIONS

    The past year was extremely difficult for the Company. After a relatively
auspicious start, which fostered an optimistic outlook for the balance of the
year, our business weakened considerably as production of domestic automobiles
trailed prior year levels and domestic manufacturing activity, in general,
remained weak. In addition, our customers continued to demand price concessions,
while simultaneously raising the bar with respect to quality and service
requirements. In response to these conditions, we relied on the time-tested
approach of cost containment and cost reductions. In retrospect, it is clear
that these actions were insufficient to offset the combined impact of lower
volumes, lower prices and increased service expectations.

2003 COMPARED TO 2002

    Reduced revenues were the dominant factor contributing to reduced margins
within the fastener segment during 2003. Fastener segment revenues declined
abruptly late in the first quarter and remained weak for the balance of the
year. For the year 2003, fastener segment revenues declined 11.3% compared to
2002, totaling a disappointing $31,024,036. Reductions in North American
production of domestic automobiles and trucks contributed to the weakness in our
business as did continuing competitive pressures which contributed to the loss
of some business, as we were unable to meet the price concessions demanded by
certain customers. In addition, some high margin parts were lost in connection
with design changes that accompanied the new model year. Reductions in
manufacturing staff failed to keep pace with the decline in business activity,
and the resultant inefficiencies are reflected in disproportionately higher
labor costs in 2003, compared to 2002. In addition, margins were adversely
affected by increases in the cost of employee health insurance and higher
tooling expenses incurred in connection with the initial production of a variety
of new parts.

    Within the assembly equipment segment, revenues declined 10.6% compared to
2002. As was the case in the fastener segment, lower volumes contributed to
significantly reduced operating efficiencies that were manifested in
disproportionately high labor and benefit costs compared with prior years. Other
factors impacting margins within this segment were increases in the cost of raw
materials, offset in part, by a decrease in depreciation expense.

    Selling and administrative expenses for 2003 were 5.9% below those for 2002.
A $302,000 reduction in profit sharing expense was the largest single factor
contributing to the decrease in this expense category, followed by reductions of
$145,000 in bonus expense, and $96,000 in commission expense due to lower sales
in the current year. These reductions were partially offset by a $74,000 expense
related to an early retirement program and an increase in the cost of employee
health insurance.

    Net interest income increased by approximately $45,000 during 2003,
primarily as a result of lower interest expense related to lower balances on a
note payable, which was paid in full in December.

2002 COMPARED TO 2001

    Net sales and lease revenues improved approximately 6% compared with 2001
and totaled $43,012,766 in 2002. As discussed below, revenue gains were achieved
in both the fastener and assembly equipment segments and the increased volume,
coupled with successful efforts to hold the line on costs, translated into
improvements in gross margins, which amounted to $10,585,563 for 2002, compared
with $9,187,046 recorded in 2001.

    Within the fastener segment, revenues increased 7%, to $34,991,758,
reflecting an overall increase in automobile production. However, it should be
noted that our volumes did not increase across our entire customer base.
Instead, our overall gain was due to increases in business with certain key
customers, bolstered by revenues related to new customers and new products from
existing customers.

    Gross margins within the fastener segment improved to 21.1% in 2002,
compared with 19.9% recorded in 2001. This improvement was largely attributable
to the effects of higher volumes and increases in efficiency associated with
those higher volumes. A number of other factors impacted operations during the
year. While we benefited from reductions in tooling costs, those savings were
offset by increases in the cost of materials and by a substantial increase in
the cost of employee health insurance.

    Activity levels within the assembly equipment segment remained well below
historical levels. While revenues within the segment improved to $8,021,008 in
2002, compared with $7,738,868 in 2001, the change is attributable to a few
large orders and not due to any significant improvement in the market for
equipment, which remained adversely affected by a persistent decline in the
broad manufacturing sector and the related restraint on capital spending.
Nevertheless, gross margins within this segment improved to approximately 40% in
2002 compared with 35% for 2001. This improvement is primarily attributable to
higher volumes and reduced labor expense.

    Selling and administrative expenses increased approximately 3.7% compared
with 2001. Both profit sharing and sales commissions increased as a result of
higher sales and increased profits. Other factors contributing to the increase
include higher salary expense and increased health insurance costs, partially
offset by a decrease in the provision for bad

- --------------------------------------------------------------------------------

                                                                               1
<PAGE>
MANAGEMENT'S REPORT
(Continued)
- --------------------------------------------------------------------------------

debt expense, which was unusually high in the prior year due to the bankruptcy
filing of a certain customer.

    The Company recorded net interest income during 2002 of $4,214, compared
with net interest expense of $114,607 in 2001, as a result of lower prevailing
interest rates and reduced debt levels.

DIVIDENDS

    In determining to pay dividends, the Board considers current profitability,
the outlook for longer-term profitability, known and potential cash requirements
and the overall financial condition of the Company. The Company paid four
regular quarterly dividends of $.18 per share during 2003. In addition, an extra
dividend of $.25 per share was paid during the second quarter of 2003, bringing
the total dividend distribution to $.97 per share. On February 16, 2004, your
Board of Directors determined that an extra dividend would not be declared or
paid in the second quarter of 2004; however, the Board did declare a regular
quarterly dividend of $.18 per share, payable March 19, 2004 to shareholders of
record on March 5, 2004. This continues the uninterrupted record of consecutive
quarterly dividends paid by the Company to its shareholders that extends over 70
years.

PROPERTY, PLANT AND EQUIPMENT

    During 2003, capital expenditures amounted to $641,715, of which $535,268
was invested within the fastener segment, $89,379 was invested within the
assembly equipment segment and the remainder was expended for building
improvements that cannot be allocated between segments. Within the fastener
segment, approximately $317,000 was invested in a new solvent-based parts
cleaning system. This system, installed during the second half of the year, is
expected to yield reductions in supply and waste disposal costs. Other
expenditures were approximately $92,000 for vehicles, including $68,000 for a
new delivery truck; $32,000 for in-line wire drawing equipment; some $21,000 for
equipment related to quality control; with the balance expended for smaller
tools and equipment and building improvements. Within the assembly equipment
segment, approximately $86,000 was expended for the purchase of new equipment
related to the manufacture of perishable tooling that is sold to customers. The
balance was expended for building improvements and office equipment.

    Investments in machinery and equipment totaled $886,009 in 2002. The
majority of this investment was related to the fastener segment of our
operations. Approximately $567,000 was invested in new equipment directly
related to the manufacture of fasteners, with an additional $123,000 expended
for equipment related to quality control and finishing operations for the
fastener segment. The balance was expended for a variety of items, including
material handling, data processing and other equipment.

    The Company invested approximately $1.4 million in machinery, equipment and
building improvements during 2001. The majority of these expenditures were
related to the fastener segment of our operations. Specifically, a total of $1.1
million was expended for the purchase of equipment used directly in the
manufacture of fasteners and $88,000 was invested in new equipment related to
the quality control process in fastener manufacturing. $129,000 was expended in
connection with data processing and data communications equipment, $61,000 was
spent for building improvements, primarily related to the fastener segment of
our business, and the balance was expended for a variety of smaller machinery
and equipment, including the manufacture of automatic rivet setting equipment
that is leased to our customers.

    Depreciation expense amounted to $1,861,600 in 2003, $1,915,726 in 2002 and
$1,921,703 in 2001.

LIQUIDITY AND CAPITAL RESOURCES

    The Company's holdings in cash, cash equivalents and certificates of
deposits amounted to nearly $6.0 million at December 31, 2003, an increase of
approximately $.6 million compared with the end of 2002. Accounts receivable
balances decreased approximately $.4 million, reflecting lower sales during the
latter part of 2003, compared to the same period in 2002. Inventory levels, at
the end of 2003, are also less than at the end of 2002 due to efforts taken to
reduce inventories in response to continued weakness in demand for our products.

    In connection with a "Dutch auction" tender offer in April 2000, the Company
obtained, on an unsecured basis, a financing commitment that provided borrowing
capacity of up to $9.0 million plus a $1.0 million line of credit. The new
borrowing was used to finance the unpaid balance of a 1996 loan related to the
acquisition of H & L Tool Company, Inc. ($2.7 million) and to fund the purchase
of stock under the terms of the "Dutch auction." At December 31, 2003, the
indebtedness under the term loan had been extinguished. The line of credit was
extended through May 31, 2004 and remained unused at December 31, 2003.

OFF-BALANCE SHEET ARRANGEMENTS

    The Company has not entered into, and has no current plans to enter into,
any off-balance sheet financing arrangements.

- --------------------------------------------------------------------------------

 2
<PAGE>
MANAGEMENT'S REPORT
(Continued)                                                 [CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------

    The following table presents a summary of the Company's contractual
obligations as of December 31, 2003:

<Table>
<Caption>
                                     PAYMENTS DUE BY PERIOD
                       ---------------------------------------------------
                                    LESS                            MORE
CONTRACTUAL                         THAN      1 - 3      4 - 5     THAN 5
OBLIGATION              TOTAL      1 YEAR     YEARS      YEARS     YEARS
- -----------            --------   --------   --------   -------   --------
<S>                    <C>        <C>        <C>        <C>       <C>
Long-term Debt.......  $     --   $     --   $     --   $    --   $     --
Capital Lease
 Obligations.........        --         --         --        --         --
Operating Leases.....    36,657     27,493      9,164        --         --
Purchase
 Obligations.........   378,686    160,750    200,256    17,680         --
                       --------   --------   --------   -------   --------
Total................  $415,343   $188,243   $209,420   $17,680   $     --
                       ========   ========   ========   =======   ========
</Table>

    Management believes that current cash, cash equivalents and operating cash
flow will be sufficient to provide adequate working capital for the foreseeable
future.

QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISKS

    As of December 31, 2003, the Company did not have any outstanding debt,
compared to $1.6 million of outstanding debt at the prior year-end, that was
exposed to changes in interest rates. During 2003 the Company did not use
derivative financial instruments relating to this interest rate exposure.

APPLICATION OF CRITICAL ACCOUNTING POLICIES

    The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the amounts of revenue and expenses during
the reporting period. During interim periods, the Company uses estimated gross
profit rates to determine the cost of goods sold for a portion of its
operations. Actual results can vary from these estimates, and these estimates
are adjusted, as necessary, when actual information is available. The effect of
these estimates is described in Note 11 of the financial statements.

NEW ACCOUNTING STANDARDS

    The Company's financial statements and financial condition were not, and are
not expected to be, materially impacted by new, or proposed, accounting
standards.

STOCK PURCHASE PROGRAM

    Terms of a stock repurchase authorization originally approved by the Board
of Directors in February of 1990, and subsequently amended to permit the
repurchase of an aggregate of 200,000 shares, permit purchases of the Company's
common stock to be made from time to time, in the open market or in private
transactions, at prices deemed reasonable by management. The company did not
purchase any of its shares during 2003. During 2002, the company purchased 1,000
shares at an average price of $26.98 per share. Cumulative purchases under the
repurchase authorization have amounted to 162,996 shares at an average price of
$15.66 per share.

OUTLOOK FOR 2004

    The anticipated improvement in economic activity has not yet generated a
meaningful increase in orders for our products. While we are encouraged by the
fact that we have been awarded contracts for a number of new parts in the
fastener segment, we are concerned about conditions within the assembly
equipment segment, which remains very weak. Domestic competition remains intense
and foreign competition, which affects us directly through the increase of
imported fasteners and indirectly through the import of products that were
previously assembled domestically, is a growing concern. These conditions
increase the risk that our markets will not only become even more price
competitive due to imports, but will shrink in size as domestic assembly
operations are supplanted by imports of products that were traditionally
assembled domestically, utilizing domestic fasteners and domestic assembly
equipment.

    As mentioned above, we are pleased that we have been awarded new business
within the fastener segment, but, in many instances, production volumes related
to this new business will not reach significant levels until later in 2004. We
will continue soliciting additional business from our current customers as well
as from new customers. We face challenges in the form of recent and significant
increases in the cost of raw materials utilized in the production of fasteners.
While we have not experienced shortages of raw material, some of our suppliers
report that increases in global demand may constrain availability of raw
materials later this year. Our success in maintaining supply and recovering
these higher costs, without losing market share, will be a critical determinant
of our success in the coming year.

    Cost reduction will be another critical factor influencing future results.
As previously reported, we have already taken actions to reduce our
manufacturing costs, but the cost reductions realized have not fully offset the
impact of lower volumes. We will continue exploring alternatives that will yield
positive changes in our cost structure and our ability to

- --------------------------------------------------------------------------------

                                                                               3
<PAGE>
MANAGEMENT'S REPORT
(Continued)
- --------------------------------------------------------------------------------

compete. Margins, at least in the near term, will remain under pressure from the
combination of rising costs and increasing foreign competition.

    We gratefully acknowledge that the Company's success, both past and future,
would not be possible without: the conscientious efforts of our employees, who
consistently demonstrate their dedication to meeting the formidable and
ever-changing challenges that characterize today's manufacturing environment;
the loyalty of our customers, many of whom face the same set of challenges; and,
the continuing support of our shareholders.

                                     Respectfully,

<Table>
  <S>                                         <C>

      /s/ J. A. MORRISSEY                         /s/ JOHN C. OSTERMAN
       John A. Morrissey                            John C. Osterman
            Chairman                                   President
</Table>

February 25, 2004

FORWARD-LOOKING STATEMENTS

     This discussion contains certain "forward-looking statements" which are
inherently subject to risks and uncertainties that may cause actual events to
differ materially from those discussed herein. Factors which may cause such
differences in events include, among other things, our ability to maintain our
relationships with our significant customers; increased global competition;
increases in the prices of, or limitations on the availability of, our primary
raw materials; or a downturn in the automotive industry, upon which we rely for
sales revenue, and which is cyclical and dependent on, among other things,
consumer spending, international economic conditions and regulations and
policies regarding international trade. Many of these factors are beyond our
ability to control or predict. Readers are cautioned not to place undue reliance
on these forward-looking statements. We undertake no obligation to publish
revised forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.

- --------------------------------------------------------------------------------

 4
<PAGE>

                                                            [CHICAGO RIVET LOGO]
- --------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEETS

<Table>
<Caption>

- -----------------------------------------------------------------------------------------------
December 31                                                        2003                2002
- -----------------------------------------------------------------------------------------------
<S>                                                             <C>                 <C>
                           ASSETS
Current Assets
  Cash and Cash Equivalents.................................    $ 5,530,099         $ 2,204,430
  Certificates of Deposit...................................        455,000           3,157,733
  Accounts Receivable -- Less allowances of $220,000 and
     $240,000, respectively.................................      4,549,168           4,994,697
  Inventories...............................................      5,233,788           6,089,941
  Deferred Income Taxes.....................................        602,191             581,191
  Other Current Assets......................................        218,560             277,983
                                                                -----------         -----------
  Total Current Assets......................................     16,588,806          17,305,975
Net Property, Plant and Equipment...........................     11,549,574          12,782,198
                                                                -----------         -----------
Total Assets................................................    $28,138,380         $30,088,173
                                                                ===========         ===========


            LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
  Current Portion of Note Payable...........................    $        --         $ 1,632,760
  Accounts Payable..........................................      1,310,044           1,121,195
  Accrued Wages and Salaries................................        754,394             795,920
  Contributions Due Profit Sharing Plan.....................        133,243             435,542
  Other Accrued Expenses....................................        370,940             446,376
                                                                -----------         -----------
  Total Current Liabilities.................................      2,568,621           4,431,793
Deferred Income Taxes.......................................      1,580,275           1,547,275
                                                                -----------         -----------
  Total Liabilities.........................................      4,148,896           5,979,068
                                                                -----------         -----------
Commitments and Contingencies (Note 12)
Shareholders' Equity
  Preferred Stock, No Par Value, 500,000 Shares Authorized:
     None Outstanding.......................................             --                  --
  Common Stock, $1.00 Par Value, 4,000,000 Shares
     Authorized: 1,138,096 Shares Issued....................      1,138,096           1,138,096
  Additional Paid-in Capital................................        447,134             447,134
  Retained Earnings.........................................     26,326,352          26,445,973
  Treasury Stock, 171,964 Shares at cost....................     (3,922,098)         (3,922,098)
                                                                -----------         -----------
  Total Shareholders' Equity................................     23,989,484          24,109,105
                                                                -----------         -----------
Total Liabilities and Shareholders' Equity..................    $28,138,380         $30,088,173
                                                                ===========         ===========
</Table>

       THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL
STATEMENTS.

- --------------------------------------------------------------------------------
                                                                               5
<PAGE>
[CHICAGO RIVET LOGO]
- --------------------------------------------------------------------------------

CONSOLIDATED STATEMENTS OF INCOME

<Table>
<Caption>

- -----------------------------------------------------------------------------------------------
For the Years Ended December 31                          2003           2002           2001
- -----------------------------------------------------------------------------------------------
<S>                                                   <C>            <C>            <C>
Net Sales and Lease Revenue.......................    $38,190,908    $43,012,766    $40,443,010
Cost of Goods Sold and Costs Related to Lease
  Revenue.........................................     30,744,104     32,427,203     31,255,964
                                                      -----------    -----------    -----------
Gross Profit......................................      7,446,804     10,585,563      9,187,046
Selling and Administrative Expenses...............      6,280,455      6,674,821      6,439,603
Other (Income) Expense, net.......................        (76,178)       (50,333)        56,173
                                                      -----------    -----------    -----------
Income Before Income Taxes........................      1,242,527      3,961,075      2,691,270
Provision for Income Taxes........................        425,000      1,357,000        899,000
                                                      -----------    -----------    -----------
Net Income........................................    $   817,527    $ 2,604,075    $ 1,792,270
                                                      ===========    ===========    ===========
Net Income Per Share..............................    $       .85    $      2.69    $      1.85
                                                      ===========    ===========    ===========
</Table>

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS

<Table>
<Caption>

- -----------------------------------------------------------------------------------------------
For the Years Ended December 31                          2003           2002           2001
- -----------------------------------------------------------------------------------------------
<S>                                                   <C>            <C>            <C>
Retained Earnings at Beginning of Year............    $26,445,973    $24,682,816    $23,828,665
Net Income........................................        817,527      2,604,075      1,792,270
Cash Dividends Paid, $.97 Per Share in 2003, $.87
  Per Share in 2002 and $.97 Per Share in 2001....       (937,148)      (840,918)      (938,119)
                                                      -----------    -----------    -----------
Retained Earnings at End of Year..................    $26,326,352    $26,445,973    $24,682,816
                                                      ===========    ===========    ===========
</Table>

       THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL
STATEMENTS.

- --------------------------------------------------------------------------------
 6
<PAGE>
                                                            [CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------

CONSOLIDATED STATEMENTS OF CASH FLOWS

<Table>
<Caption>

         ---------------------------------------------------------------------------------------------------
         For the Years Ended December 31                                2003          2002          2001
         ---------------------------------------------------------------------------------------------------
         <S>                                                         <C>           <C>           <C>
         Cash Flows from Operating Activities:
         Net Income................................................  $   817,527   $ 2,604,075   $ 1,792,270
         Adjustments to Reconcile Net Income to Net Cash Provided
           by Operating Activities:
           Depreciation and Amortization...........................    1,861,600     1,915,726     1,921,703
           Net Gain on the Sale of Properties......................      (11,405)      (30,559)      (42,917)
           Deferred Income Taxes...................................       12,000       144,000       154,000
           Changes in Operating Assets and Liabilities:
             Accounts Receivable, net..............................      445,529      (999,549)    1,042,083
             Inventories...........................................      856,153       (39,273)    1,153,516
             Other Current Assets..................................       59,423        57,607      (143,922)
             Accounts Payable......................................      188,849       191,561      (135,927)
             Accrued Wages and Salaries............................      (41,526)       44,338        (1,995)
             Accrued Profit Sharing Plan Contributions.............     (302,299)      140,556      (142,090)
             Other Accrued Expenses................................      (75,436)      (20,476)     (309,245)
                                                                     -----------   -----------   -----------

                  Net Cash Provided by Operating Activities........    3,810,415     4,008,006     5,287,476
                                                                     -----------   -----------   -----------
         Cash Flows from Investing Activities:
           Capital Expenditures....................................     (641,715)     (886,009)   (1,431,698)
           Proceeds from the Sale of Properties....................       24,144        37,179        57,894
           Proceeds from Held-to-Maturity Securities...............    3,207,733     3,007,882     3,815,989
           Purchases of Held-to-Maturity Securities................     (505,000)   (5,987,733)   (2,563,985)
                                                                     -----------   -----------   -----------
                Net Cash Provided by (Used in) Investing
                  Activities.......................................    2,085,162    (3,828,681)     (121,800)
                                                                     -----------   -----------   -----------
         Cash Flows from Financing Activities:
           Payments under Term Loan Agreement......................   (1,632,760)   (1,800,000)   (1,800,000)
           Purchases of Treasury Stock.............................           --       (26,976)           --
           Cash Dividends Paid.....................................     (937,148)     (840,918)     (938,119)
                                                                     -----------   -----------   -----------
                Net Cash Used in Financing Activities..............   (2,569,908)   (2,667,894)   (2,738,119)
                                                                     -----------   -----------   -----------
         Net Increase (Decrease) in Cash and Cash Equivalents......    3,325,669    (2,488,569)    2,427,557
         Cash and Cash Equivalents:
           Beginning of Year.......................................    2,204,430     4,692,999     2,265,442
                                                                     -----------   -----------   -----------
           End of Year.............................................  $ 5,530,099   $ 2,204,430   $ 4,692,999
                                                                     ===========   ===========   ===========
         Cash Paid During the Year for:
           Income Taxes............................................  $   508,213   $ 1,247,000   $   663,381
           Interest................................................  $    20,633   $    79,708   $   354,649
</Table>

       THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL
STATEMENTS.

- --------------------------------------------------------------------------------
                                                                               7
<PAGE>

[CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS

1--NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

NATURE OF BUSINESS--The Company operates in the fastener industry and is in the
business of producing and selling rivets, cold-formed fasteners, screw machine
products, automatic rivet setting machines, parts and tools for such machines,
and the leasing of automatic rivet setting machines.

A SUMMARY OF THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES FOLLOWS:

PRINCIPLES OF CONSOLIDATION--The consolidated financial statements include the
accounts of Chicago Rivet & Machine Co. and its wholly-owned subsidiary, H & L
Tool Company, Inc. (H & L Tool). All significant intercompany accounts and
transactions have been eliminated.

REVENUE RECOGNITION--Revenues from product sales are recognized upon shipment
and an allowance is provided for estimated returns and discounts based on
experience.

LEASE INCOME--Automatic rivet setting machines are available to customers on
either a sale or lease basis. The leases, generally are for a quarterly or
one-year term, are cancelable at the option of the Company or the customer and
are accounted for under the operating method, which recognizes lease revenue
over the term of the lease. Rentals are billed in advance, and revenues
attributable to future periods are included in unearned revenue in the
consolidated balance sheets. Costs related to lease revenue, other than the cost
of the machines, are expensed as incurred.

CREDIT RISK--The Company extends credit on the basis of terms that are customary
within our markets to various companies doing business primarily in the
automotive industry. The Company has a concentration of credit risk primarily
within the automotive industry and in the Midwestern United States.

CASH AND CASH EQUIVALENTS--The Company considers all highly liquid investments
with a maturity of three months or less when purchased to be cash equivalents.

FAIR VALUE OF FINANCIAL INSTRUMENTS--The carrying amounts reported in the
consolidated balance sheets for cash and cash equivalents and certificates of
deposit approximate fair value. The carrying amount reported for the note
payable approximated fair market value.

INVENTORIES--Inventories are stated at the lower of cost or net realizable
value, cost being determined principally by the first-in, first-out method.

PROPERTY, PLANT AND EQUIPMENT--Properties are stated at cost and are depreciated
over their estimated useful lives using the straight-line method for financial
reporting purposes. Accelerated methods of depreciation are used for income tax
purposes. Direct costs related to developing or obtaining software for internal
use are capitalized as property and equipment. Capitalized software costs are
amortized over the software's useful life when the software is ready for its
intended use. The estimated useful lives by asset category are:

Asset category                                             Estimated useful life
- ------------------------------------------------------------

<Table>
<S>                                          <C>
Land improvements...........................    15 to 25 years
Buildings and improvements..................    10 to 35 years
Machinery and equipment.....................     7 to 15 years
Automatic rivet setting machines on lease...          10 years
Capitalized software costs..................      3 to 5 years
Other equipment.............................     3 to 15 years
</Table>

The Company reviews the carrying value of property, plant and equipment for
impairment whenever events and circumstances indicate that the carrying value of
an asset may not be recoverable from the estimated future cash flows expected to
result from its use and eventual disposition. In cases where undiscounted
expected future cash flows are less than the carrying value, an impairment loss
is recognized equal to an amount by which the carrying value exceeds the fair
value of assets.

When properties are retired or sold, the related cost and accumulated
depreciation are removed from the respective accounts, and any gain or loss on
disposition is recognized currently. Maintenance, repairs and minor betterments
that do not improve the related asset or extend its useful life are charged to
operations as incurred.

INCOME TAXES--Deferred income taxes are determined under the asset and liability
method in accordance with Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes." Deferred income taxes arise from temporary
differences between the income tax basis of assets and liabilities and their
reported amounts in the financial statements.

SEGMENT INFORMATION--The Company reports segment information in accordance with
Statement of Financial Accounting Standards No. 131 ("FAS 131"), "Disclosures
about Segments of an Enterprise and Related Information." FAS 131 requires that
segments be based on the internal structure and reporting of the Company's
operations.

NET INCOME PER SHARE--Net income per share of common stock is based on the
weighted average number of shares outstanding of 966,132 in 2003, 966,537 in
2002 and 967,132 in 2001.

ESTIMATES--The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and the
accompanying notes. Actual results could differ from those estimates.

RECLASSIFICATIONS--Certain items in 2002 and 2001 have been reclassified to
conform to the presentation in 2003. These changes have no effect on the
financial position of the Company.

- --------------------------------------------------------------------------------
 8
<PAGE>

                                                            [CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------

2--BALANCE SHEET DETAILS

<Table>
<Caption>
                                      2003            2002
                                  ------------    ------------
<S>                               <C>             <C>
Inventories:
  Raw materials.................  $ 1,109,463     $ 1,636,216
  Work in process...............    1,760,990       1,818,106
  Finished goods................    2,363,335       2,635,619
                                  -----------     -----------
                                  $ 5,233,788     $ 6,089,941
                                  ===========     ===========
Net Property, Plant and
  Equipment:
  Land and improvements.........  $ 1,015,635     $ 1,010,595
  Buildings and improvements....    5,779,993       5,743,325
  Production equipment, leased
    machines and other..........   28,201,191      27,774,278
                                  -----------     -----------
                                   34,996,819      34,528,198
  Accumulated depreciation......   23,447,245      21,746,000
                                  -----------     -----------
                                  $11,549,574     $12,782,198
                                  ===========     ===========
Other Accrued Expenses:
  Property taxes................  $   112,794     $   116,837
  Unearned revenue and customer
    deposits....................      120,893         140,390
  All other items...............      137,253         189,149
                                  -----------     -----------
                                  $   370,940     $   446,376
                                  ===========     ===========
</Table>

3--LEASED MACHINES--Lease revenue amounted to $160,312 in 2003, $198,869 in 2002
and $225,948 in 2001. Future minimum rentals on leases beyond one year are not
significant. The cost and carrying value of leased automatic rivet setting
machines at December 31 were:

<Table>
<Caption>
                                          2003         2002
                                        ---------    ---------
<S>                                     <C>          <C>
Cost..................................  $343,833     $450,717
Accumulated depreciation..............   331,933      422,828
                                        --------     --------
Carrying value........................  $ 11,900     $ 27,889
                                        ========     ========
</Table>

4--INCOME TAXES--The provision for income tax expense consists of the following:

<Table>
<Caption>
                              2003         2002          2001
                           ----------   -----------   -----------
<S>                        <C>          <C>           <C>
Current:
  Federal................  $  408,000   $ 1,203,000   $   739,000
  State..................       5,000        10,000         6,000
Deferred.................      12,000       144,000       154,000
                           ----------   -----------   -----------
                           $  425,000   $ 1,357,000   $   899,000
                           ==========   ===========   ===========
</Table>

The deferred tax liabilities and assets consist of the following:

<Table>
<Caption>
                                      2003            2002
                                  ------------    ------------
<S>                               <C>             <C>
Depreciation....................  $(1,592,820)    $(1,560,005)
                                  -----------     -----------
Inventory.......................      338,281         311,911
Accrued vacation................      171,491         170,292
Allowance for doubtful
  accounts......................       76,800          83,800
Other, net......................       28,164          27,918
                                  -----------     -----------
                                      614,736         593,921
                                  -----------     -----------
                                  $  (978,084)    $  (966,084)
                                  ===========     ===========
</Table>

The following is a reconciliation of the statutory federal income tax rate to
the actual effective tax rate:

<Table>
<Caption>
                                      2003               2002               2001
                                 ---------------   -----------------   ---------------
                                  AMOUNT     %       Amount      %      Amount     %
                                 ---------------   -----------------   ---------------
<S>                              <C>        <C>    <C>          <C>    <C>        <C>
Expected tax at U.S. Statutory
 rate..........................  $422,000   34.0   $1,347,000   34.0   $915,000   34.0
State taxes, net of federal
 benefit.......................     3,000     .2        7,000     .2      4,000     .1
Other, net.....................        --     --        3,000     .1      5,000     .2
Adjustment to prior year
 accrual.......................        --     --           --     --    (25,000)   (.9)
                                 --------   ----   ----------   ----   --------   ----
Income tax expense.............  $425,000   34.2   $1,357,000   34.3   $899,000   33.4
                                 ========   ====   ==========   ====   ========   ====
</Table>

5--NOTE PAYABLE-- In connection with the tender offer completed in April 2000,
the Company obtained, on an unsecured basis, a financing commitment that
provided borrowing capacity of up to $9 million plus a $1 million line of
credit. The new borrowing was used to repay an existing loan and to fund
purchases of stock under the terms of a "Dutch auction." As of December 31,
2003, the term loan was paid off. The line of credit was extended through May
31, 2004 and remained unused at December 31, 2003.

6--TREASURY STOCK TRANSACTIONS--In 2002, the Company purchased 1,000 shares of
its common stock for $26,976. These shares are being held in treasury. During
2003 and 2001, no shares were purchased.

7--SHAREHOLDER RIGHTS AGREEMENT--On November 22, 1999, the Company adopted a
shareholder rights agreement and declared a dividend distribution of one right
for each outstanding share of Company common stock to shareholders of record at
the close of business on December 3, 1999. Each right entitles the holder, upon
occurrence of certain events, to buy one one-hundredth of a share of Series A
Junior Participating Preferred Stock at a price of $90, subject to adjustment.
The rights may only become exercisable under certain circumstances involving
acquisition of the Company's common stock, including the purchase of 10 percent
or more by any person or group. The rights will expire on December 2, 2009
unless they are extended, redeemed or exchanged.

8--PROFIT SHARING PLAN--The Company has a noncontributory profit sharing plan
covering substantially all employees. Total expenses relating to the profit
sharing plan amounted to approximately $133,000 in 2003, $435,000 in 2002 and
$295,000 in 2001.

- --------------------------------------------------------------------------------
                                                                               9
<PAGE>

[CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------

9--OTHER INCOME (EXPENSE), NET--consists of the following:

<Table>
<Caption>
                                2003        2002         2001
                              ---------   ---------   ----------
<S>                           <C>         <C>         <C>
Interest income.............  $  72,087   $  83,770   $  145,233
Interest expense............    (22,847)    (79,556)    (259,840)
Gain on sale of property and
  equipment.................     11,405      30,559       42,917
Other.......................     15,533      15,560       15,517
                              ---------   ---------   ----------
                              $  76,178   $  50,333   $  (56,173)
                              =========   =========   ==========
</Table>

10--SEGMENT INFORMATION--The Company operates, primarily in the United States,
in two business segments as determined by its products. The fastener segment,
which comprises H & L Tool and the parent company's fastener operations,
includes rivets, cold-formed fasteners and screw machine products. The assembly
equipment segment includes automatic rivet setting machines, parts and tools for
such machines and the leasing of automatic rivet setting machines. Information
by segment is as follows:

<Table>
<Caption>
                                          ASSEMBLY
                           FASTENER       EQUIPMENT       OTHER      CONSOLIDATED
                          -----------   -------------   ----------   ------------
<S>                       <C>           <C>             <C>          <C>
YEAR ENDED DECEMBER 31,
 2003:
Net sales and lease
 revenue................  $31,024,036    $7,166,872     $       --   $38,190,908
Depreciation............    1,490,592       161,200        209,808     1,861,600
Segment profit..........    2,084,889     1,482,888             --     3,567,777
Selling and
 administrative
 expenses...............                                 2,374,490     2,374,490
Interest expense........                                    22,847        22,847
Interest income.........                                   (72,087)      (72,087)
                                                                     -----------
Income before income
 taxes..................                                               1,242,527
                                                                     -----------
Capital expenditures....      535,268        89,379         17,068       641,715
Segment assets:
 Accounts receivable....    3,836,968       712,200             --     4,549,168
 Inventory..............    3,191,132     2,042,656             --     5,233,788
 Property, plant and
   equipment............    9,099,003     1,448,530      1,002,041    11,549,574
 Other assets...........           --            --      6,805,850     6,805,850
                                                                     -----------
                                                                      28,138,380
                                                                     -----------
Year Ended December 31,
 2002:
Net sales and lease
 revenue................  $34,991,758    $8,021,008     $       --   $43,012,766
Depreciation............    1,474,228       217,665        223,833     1,915,726
Segment profit..........    4,499,657     2,325,353             --     6,825,010
Selling and
 administrative
 expenses...............                                 2,868,149     2,868,149
Interest expense........                                    79,556        79,556
Interest income.........                                   (83,770)      (83,770)
                                                                     -----------
Income before income
 taxes..................                                               3,961,075
                                                                     -----------
Capital expenditures....      790,261        13,446         82,302       886,009
Segment assets:
 Accounts receivable....    4,115,988       878,709             --     4,994,697
 Inventory..............    3,874,804     2,215,137             --     6,089,941
 Property, plant and
   equipment............   10,054,327     1,530,960      1,196,911    12,782,198
 Other assets...........           --            --      6,221,337     6,221,337
                                                                     -----------
                                                                      30,088,173
                                                                     -----------
</Table>

<Table>
<Caption>
                                          Assembly
                           Fastener       Equipment       Other      Consolidated
                          -----------   -------------   ----------   ------------
<S>                       <C>           <C>             <C>          <C>
Year Ended
 December 31, 2001:
Net sales and lease
 revenue................  $32,704,142    $7,738,868     $       --   $40,443,010
Depreciation............    1,446,254       242,517        232,932     1,921,703
Segment profit..........    3,892,772     1,860,559             --     5,753,331
Selling and
 administrative
 expenses...............                                 2,947,454     2,947,454
Interest expense........                                   259,840       259,840
Interest income.........                                  (145,233)     (145,233)
                                                                     -----------
Income before income
 taxes..................                                               2,691,270
                                                                     -----------
Capital expenditures....    1,283,566        17,209        130,923     1,431,698
Segment assets:
 Accounts receivable....    3,276,948       718,200             --     3,995,148
 Inventory..............    3,636,677     2,413,991             --     6,050,668
 Property, plant and
   equipment............   10,741,793     1,737,603      1,339,139    13,818,535
 Other assets...........           --            --      5,813,662     5,813,662
                                                                     -----------
                                                                      29,678,013
                                                                     -----------
</Table>

    The Company does not allocate certain selling and administrative expenses
for internal reporting, thus, no allocation was made for these expenses for
segment disclosure purposes. Segment assets reported internally are limited to
accounts receivable, inventory and long-lived assets. Long-lived assets of one
plant location are allocated between the two segments based on estimated plant
utilization, as this plant serves both fastener and assembly equipment
activities. Other assets are not allocated to segments internally and to do so
would be impracticable. Sales to two customers in the fastener segment accounted
for 13, 18 and 18 percent and 21, 17 and 14 percent of consolidated revenues
during 2003, 2002 and 2001, respectively. Sales to a third customer amounted to
10 percent in 2001.

11--OTHER UNUSUAL ITEMS OF INCOME AND EXPENSE-- During interim periods, the
Company uses estimated gross profit rates to determine the cost of goods sold
for a portion of its operations. Actual results can vary from these estimates,
and these estimates are adjusted, as necessary, when actual information is
available. Fourth quarter net income includes the net favorable (unfavorable)
effect of certain adjustments related to inventory and certain accruals of $.01
and $(.02) per share, for 2002 and 2001, respectively. There was no fourth
quarter adjustment in 2003.

12--COMMITMENTS AND CONTINGENCIES--The Company recorded rent expense aggregating
approximately $40,000, $41,000 and $40,000 for 2003, 2002 and 2001,
respectively. Total future minimum rentals at December 31, 2003 are not
significant.

The Company is, from time to time involved in litigation, including
environmental claims, in the normal course of business. While it is not possible
at this time to establish the ultimate amount of liability with respect to
contingent liabilities, including those related to legal proceedings, management
is of the opinion that the aggregate amount of any such liabilities, for which
provision has not been made, will not have a material adverse effect on the
Company's financial position.

- --------------------------------------------------------------------------------
 10
<PAGE>

                                                            [CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------

REPORT OF INDEPENDENT AUDITORS

To the Board of Directors and Shareholders of
Chicago Rivet & Machine Co.

    In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of income, retained earnings and cash flows present
fairly, in all material respects, the financial position of Chicago Rivet &
Machine Co. and its subsidiary at December 31, 2003 and 2002, and the results of
their operations and their cash flows for each of the three years in the period
ended December 31, 2003 in conformity with accounting principles generally
accepted in the United States of America. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with auditing standards generally
accepted in the United States of America, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Chicago, Illinois
February 25, 2004

SELECTED FINANCIAL DATA

<Table>
<Caption>
- -------------------------------------------------------------------------------------------------------------------------------
                                                           2003           2002           2001           2000           1999
- -------------------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>            <C>            <C>            <C>            <C>
Net Sales and Lease Revenue                             $38,190,908    $43,012,766    $40,443,010    $45,423,263    $49,080,257
- -------------------------------------------------------------------------------------------------------------------------------
Income Before Income Taxes                                1,242,527      3,961,075      2,691,270      3,986,161      5,229,291
- -------------------------------------------------------------------------------------------------------------------------------
Net Income                                                  817,527      2,604,075      1,792,270      2,656,161      3,454,291
- -------------------------------------------------------------------------------------------------------------------------------
Net Income Per Share                                            .85           2.69           1.85           2.60           3.00
- -------------------------------------------------------------------------------------------------------------------------------
Dividends Per Share                                             .97            .87            .97           1.07           1.07
- -------------------------------------------------------------------------------------------------------------------------------
Average Common Shares Outstanding                           966,132        966,537        967,132      1,022,627      1,151,333
- -------------------------------------------------------------------------------------------------------------------------------
Working Capital                                          14,020,185     12,874,182     11,616,424     12,001,291     12,447,590
- -------------------------------------------------------------------------------------------------------------------------------
Total Debt                                                       --      1,632,760      3,432,760      5,232,760      3,150,000
- -------------------------------------------------------------------------------------------------------------------------------
Total Assets                                             28,138,380     30,088,173     29,678,013     31,157,119     32,621,585
- -------------------------------------------------------------------------------------------------------------------------------
Shareholders' Equity                                     23,989,484     24,109,105     22,372,924     21,518,773     23,887,278
- -------------------------------------------------------------------------------------------------------------------------------
</Table>

- --------------------------------------------------------------------------------
                                                                              11
<PAGE>

[CHIGAGO RIVET LOGO]
- --------------------------------------------------------------------------------
QUARTERLY FINANCIAL DATA (UNAUDITED)

<Table>
<Caption>
                           1ST           2ND          3RD           4TH
                         QUARTER       QUARTER      QUARTER       QUARTER
                       -----------   -----------   ----------   -----------
<S>                    <C>           <C>           <C>          <C>
2003
Net Sales and Lease
 Revenue.............  $10,236,463   $10,005,944   $8,831,742   $ 9,116,759
Gross Profit.........    2,385,529     1,929,633    1,539,172     1,592,470
Net Income...........      465,241       221,621        5,431       125,234
Per Share Data:
 Net Income Per
   Share.............          .48           .23          .01           .13
 Average Common
   Shares
   Outstanding.......      966,132       966,132      966,132       966,132

2002
Net Sales and Lease
 Revenue.............  $10,452,326   $12,437,856   $9,832,012   $10,290,572
Gross Profit.........    2,575,805     3,116,223    2,280,903     2,612,632
Net Income...........      625,116       902,589      435,015       641,355
Per Share Data:
 Net Income Per
   Share.............          .65           .93          .45           .66
 Average Common
   Shares
   Outstanding.......      967,132       966,768      966,132       966,132

2001
Net Sales and Lease
 Revenue.............  $10,627,831   $11,216,249   $9,398,572   $ 9,200,358
Gross Profit.........    2,249,917     2,819,622    2,330,542     1,786,965
Net Income...........      339,241       737,438      426,996       288,595
Per Share Data:
 Net Income Per
   Share.............          .35           .76          .44           .30
 Average Common
   Shares
   Outstanding.......      967,132       967,132      967,132       967,132
</Table>

INFORMATION ON COMPANY'S COMMON STOCK

The Company's common stock is traded on the American Stock Exchange. The ticker
symbol is: CVR.

At December 31, 2003, there were approximately 310 shareholders of record.

The transfer agent and registrar for the Company's common stock is:

EquiServe Trust Company, N.A.
P.O. Box 43069
Providence, RI 02940-3069

The following table shows the dividends declared and the quarterly high and low
prices of the common stock for the last two years.

<Table>
<Caption>


                        Dividends
                         Declared                  Market Range
                       ----------------------------------------------------
Quarter                2003    2002          2003                2002
- ---------------------  ----    ----    ----------------    ----------------
<S>                    <C>     <C>     <C>       <C>       <C>       <C>
First................  $.43*   $.33*   $25.50    $22.80    $28.80    $22.70
Second...............   .18     .18    $26.26    $24.10    $28.80    $25.65
Third................   .18     .18    $29.99    $26.30    $26.60    $23.50
Fourth...............   .18     .18    $28.24    $25.00    $26.66    $22.40
</Table>

- ---------------
* Includes an extra dividend of $.25 and $.15 per share in 2003 and 2002,
  respectively.

- --------------------------------------------------------------------------------
 12
<PAGE>

                                                      [CHIGAGO RIVET LETTERHEAD]
- --------------------------------------------------------------------------------

BOARD OF DIRECTORS

EDWARD L. CHOTT(a)(c)(n)
Chairman and Chief
Executive Officer of
The Broaster Co.
Beloit, Wisconsin

NIRENDU DHAR
General Manager of
H & L Tool Company, Inc.

WILLIAM T. DIVANE, JR.(a)(c)(n)
Chairman of the Board and
Chief Executive Officer of
Divane Bros. Electric Co.
Franklin Park, Illinois

JOHN R. MADDEN(a)(c)(e)(n)
Chairman of the Board of
First National Bank
of La Grange
La Grange, Illinois

JOHN A. MORRISSEY(e)
Chairman of the Board
of the Company
President and Director of
Algonquin State Bank
Algonquin, Illinois

WALTER W. MORRISSEY(e)
Attorney at Law
Morrissey & Robinson
Oakbrook Terrace, Illinois

JOHN C. OSTERMAN(e)
President of the Company

CORPORATE OFFICERS

JOHN A. MORRISSEY
Chairman, Chief
Executive Officer

JOHN C. OSTERMAN
President, Chief Operating
Officer and Treasurer
NIRENDU DHAR
General Manager of
H & L Tool Company, Inc.

DONALD P. LONG
Vice President-Sales

KIMBERLY A. KIRHOFER
Secretary

MICHAEL J. BOURG
Corporate Controller

CHICAGO RIVET & MACHINE CO.

ADMINISTRATIVE & SALES OFFICES
Naperville, Illinois
Norwell, Massachusetts

MANUFACTURING FACILITIES
Albia Division
Albia, Iowa

Jefferson Division
Jefferson, Iowa

Tyrone Division
Tyrone, Pennsylvania

H & L Tool Company, Inc.
Madison Heights, Michigan

WEB SITE
www.chicagorivet.com

(a) Member of Audit Committee
(c) Member of Compensation Committee
(e) Member of Executive Committee
(n) Member of Nominating Committee

- --------------------------------------------------------------------------------
<PAGE>

                      [CHICAGO RIVET GRAPHIC & LETTERHEAD]

- --------------------------------------------------------------------------------

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-14
<SEQUENCE>5
<FILENAME>c83813exv14.txt
<DESCRIPTION>CODE OF ETHICS
<TEXT>
<PAGE>

                                   EXHIBIT 14

                                       64
<PAGE>

EXHIBIT 14

                                 CODE OF ETHICS
                     FOR CHIEF EXECUTIVE AND SENIOR OFFICERS

The Company is committed to conducting our business in accordance with
applicable laws, rules and regulations and the highest standards of business
conduct, and to full and accurate financial disclosure in compliance with
applicable law. This Code of Ethics, applicable to the Company's Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer and Controller (or
persons performing similar functions) (together, "Senior Officers"), sets forth
specific policies to guide you in the performance of your duties.

As a Senior Officer, you must not only comply with applicable law. You also must
engage in and promote honest and ethical conduct and abide by the Code of
Business Conduct and other Company policies and procedures that govern the
conduct of our business. Your leadership responsibilities include creating a
culture of ethical business conduct and commitment to compliance, maintaining a
work environment that encourages employees to raise concerns, and promptly
addressing employee compliance concerns.

COMPLIANCE WITH LAWS, RULES AND REGULATIONS

You are required to comply with the laws, rules and regulations that govern the
conduct of our business and to report any suspected violations in accordance
with the section below entitled "Compliance With Code Of Ethics."

CONFLICTS OF INTEREST

Your obligation to conduct the Company's business in an honest and ethical
manner includes the ethical handling of actual or apparent conflicts of interest
between personal and professional relationships. No Senior Officer shall make
any investment, accept any position or benefits, participate in any transaction
or business arrangement or otherwise act in a manner that creates or appears to
create a conflict of interest unless the Senior Officer makes full disclosure of
all facts and circumstances to, and obtains the prior written approval of, the
Audit Committee of the Board of Directors.

DISCLOSURES

It is Company policy to make full, fair, accurate, timely and understandable
disclosure in compliance with all applicable laws and regulations in all reports
and documents that the Company files with, or submits to, the Securities and
Exchange Commission and in all other public communications made by the Company.
As a Senior Officer, you are required to promote compliance with this policy and
to abide by Company standards, policies and procedures designed to promote
compliance with this policy.

                                       65
<PAGE>

COMPLIANCE WITH CODE OF ETHICS

If you know of or suspect a violation of applicable laws, rules or regulations
or this Code of Ethics, you must immediately report that information to any
member of the Audit Committee of the Board of Directors. No one will be subject
to retaliation because of a good faith report of a suspected violation.

Violations of this Code of Ethics may result in disciplinary action, up to and
including discharge. The Audit Committee of the Board of Directors shall
determine, or shall designate appropriate persons to determine, appropriate
action in response to violations of this Code.

WAIVERS OF CODE OF ETHICS

If you would like to seek a waiver of the Code of Ethics you must make full
disclosure of your particular circumstances to the Audit Committee of the Board
of Directors. Amendments to and waivers of this Code of Ethics will be publicly
disclosed as required by applicable law and regulations.

NO RIGHTS CREATED

This Code of Ethics is a statement of certain fundamental principles, policies
and procedures that govern the Company's Senior Officers in the conduct of the
Company's business. It is not intended to and does not create any rights in any
employee, customer/client, supplier, competitor, shareholder or any other
person or entity.

                                       66

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21
<SEQUENCE>6
<FILENAME>c83813exv21.txt
<DESCRIPTION>SUBSIDIARIES OF THE REGISTRANT
<TEXT>
<PAGE>

                                   EXHIBIT 21

                           CHICAGO RIVET & MACHINE CO.

                         SUBSIDIARIES OF THE REGISTRANT

         The Company's only subsidiary is H & L Tool Company, Inc., which is
wholly-owned and is organized in the State of Illinois.

                                       67

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>7
<FILENAME>c83813exv31w1.txt
<DESCRIPTION>CERTIFICATION OF THE CEO
<TEXT>
<PAGE>

EXHIBIT 31.1

         I, John A. Morrissey, certify that:

1.       I have reviewed this annual report on Form 10-K of Chicago Rivet &
         Machine Co.;

2.       Based on my knowledge, this report does not contain any untrue
         statement of a material fact or omit to state a material fact necessary
         to make the statements made, in light of the circumstances under which
         such statements were made, not misleading with respect to the period
         covered by this report;

3.       Based on my knowledge, the financial statements, and other financial
         information included in this report, fairly present in all material
         respects the financial condition, results of operations and cash flows
         of the registrant as of, and for, the periods presented in this report;

4.       The registrant's other certifying officer(s) and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
         registrant and have:

         a)       Designed such disclosure controls and procedures, or caused
                  such disclosure controls and procedures to be designed under
                  our supervision, to ensure that material information relating
                  to the registrant, including its consolidated subsidiaries, is
                  made known to us by others within those entities, particularly
                  during the period in which this report is being prepared;

         b)       Evaluated the effectiveness of the registrant's disclosure
                  controls and procedures and presented in this report our
                  conclusions about the effectiveness of the disclosure controls
                  and procedures, as of the end of the period covered by this
                  report based on such evaluation; and

         c)       Disclosed in this report any change in the registrant's
                  internal control over financial reporting that occurred during
                  the registrant's most recent fiscal quarter (the registrant's
                  fourth fiscal quarter in the case of an annual report) that
                  has materially affected, or is reasonably likely to materially
                  affect, the registrant's internal control over financial
                  reporting; and

5.       The registrant's other certifying officer(s) and I have disclosed,
         based on our most recent evaluation of internal control over financial
         reporting, to the registrant's auditors and the audit committee of the
         registrant's board of directors (or persons performing the equivalent
         functions):

         a)       All significant deficiencies and material weaknesses in the
                  design or operation of internal control over financial
                  reporting which are reasonably likely to adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial information; and

         b)       Any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal control over financial reporting.

Date: March 29, 2004       /s/ John A. Morrissey
                           ---------------------
                           John A. Morrissey
                           Chief Executive Officer

                                       68

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>8
<FILENAME>c83813exv31w2.txt
<DESCRIPTION>CERTIFICATION OF THE CFO
<TEXT>
<PAGE>

EXHIBIT 31.2

         I, John C. Osterman, certify that:

1.       I have reviewed this annual report on Form 10-K of Chicago Rivet &
         Machine Co.;

2.       Based on my knowledge, this report does not contain any untrue
         statement of a material fact or omit to state a material fact necessary
         to make the statements made, in light of the circumstances under which
         such statements were made, not misleading with respect to the period
         covered by this report;

3.       Based on my knowledge, the financial statements, and other financial
         information included in this report, fairly present in all material
         respects the financial condition, results of operations and cash flows
         of the registrant as of, and for, the periods presented in this report;

4.       The registrant's other certifying officer(s) and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
         registrant and have:

         a)       Designed such disclosure controls and procedures, or caused
                  such disclosure controls and procedures to be designed under
                  our supervision, to ensure that material information relating
                  to the registrant, including its consolidated subsidiaries, is
                  made known to us by others within those entities, particularly
                  during the period in which this report is being prepared;

         b)       Evaluated the effectiveness of the registrant's disclosure
                  controls and procedures and presented in this report our
                  conclusions about the effectiveness of the disclosure controls
                  and procedures, as of the end of the period covered by this
                  report based on such evaluation; and

         c)       Disclosed in this report any change in the registrant's
                  internal control over financial reporting that occurred during
                  the registrant's most recent fiscal quarter (the registrant's
                  fourth fiscal quarter in the case of an annual report) that
                  has materially affected, or is reasonably likely to materially
                  affect, the registrant's internal control over financial
                  reporting; and

5.       The registrant's other certifying officer(s) and I have disclosed,
         based on our most recent evaluation of internal control over financial
         reporting, to the registrant's auditors and the audit committee of the
         registrant's board of directors (or persons performing the equivalent
         functions):

         a)       All significant deficiencies and material weaknesses in the
                  design or operation of internal control over financial
                  reporting which are reasonably likely to adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial information; and

         b)       Any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal control over financial reporting.

Date:  March 29, 2004      /s/ John C. Osterman
                           --------------------
                                 John C. Osterman
                                 Chief Financial Officer

                                       69

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>9
<FILENAME>c83813exv32w1.txt
<DESCRIPTION>CERTIFICATION OF THE CEO
<TEXT>
<PAGE>

                                  EXHIBIT 32.1

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report on Form 10-K of Chicago Rivet & Machine Co.
(the "Company") for the period ended December 31, 2003 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, John A.
Morrissey, as Chief Executive Officer of the Company, hereby certify, pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

         (1)      The Report fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934; and

         (2)      The information contained in the Report fairly presents, in
all material respects, the financial condition and results of operations of the
Company.

/s/ John A. Morrissey
- ---------------------
Name:  John A. Morrissey
Title: Chief Executive Officer
Date:  March 29, 2004

                                       70

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.2
<SEQUENCE>10
<FILENAME>c83813exv32w2.txt
<DESCRIPTION>CERTIFICATION OF THE CFO
<TEXT>
<PAGE>

                                  EXHIBIT 32.2

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report on Form 10-K of Chicago Rivet & Machine Co.
(the "Company") for the period ended December 31, 2003 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, John C.
Osterman, as Chief Financial Officer of the Company, hereby certify, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that, to the best of my knowledge:

         (1)      The Report fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934; and

         (2)      The information contained in the Report fairly presents, in
all material respects, the financial condition and results of operations of the
Company.

/s/ John C. Osterman
- --------------------
Name:  John C. Osterman
Title: Chief Financial Officer
Date:  March 29, 2004

                                       71

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
