<PAGE> 1
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant /_/
Filed by a Party other than the Registrant /x/
Check the appropriate box:
/x/ Preliminary Proxy Statement
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to
Section 240.14a-11(c)
or Section 240.14a-12
/_/ Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
Wallace Computer Services, Inc.
(Name of Registrant as Specified In Its Charter)
Moore Corporation Limited
FRDK, Inc.
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/_/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
or 14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
/x/ $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
/_/ Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction
applies:
______________________________________________________________________
(2) Aggregate number of securities to which transaction
applies:
______________________________________________________________________
<PAGE> 2
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was determined):
_________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
_________________________________________________________________
(5) Total fee paid:
_________________________________________________________________
/_/ Fee paid previously with preliminary materials.
_________________________________________________________________
/_/ Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or Schedule
and the date of its filing.
(1) Amount Previously Paid:
_________________________________________________________________
(2) Form, Schedule or Registration Statement No.:
_________________________________________________________________
(3) Filing Party:
_________________________________________________________________
(4) Date Filed:
_________________________________________________________________
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<PAGE> 3
PRELIMINARY COPIES, DATED SEPTEMBER 12, 1995
1995 ANNUAL MEETING OF STOCKHOLDERS
OF
WALLACE COMPUTER SERVICES, INC.
4600 W. ROOSEVELT ROAD
HILLSIDE, ILLINOIS 60162
(312) 626-2000
______________________________
PROXY STATEMENT
OF
MOORE CORPORATION LIMITED
AND
FRDK, INC.
______________________________
This Proxy Statement is furnished in connection with the solicitation
of proxies by Moore Corporation Limited ("Moore") and its wholly owned
subsidiary FRDK, Inc. ("FRDK") to be used at the 1995 Annual Meeting of
Stockholders of Wallace Computer Services, Inc., a Delaware corporation
("Wallace"), to be held at [_______________________] on [____________________]
and at any adjournments or postponements thereof (the "Annual Meeting").
On August 2, 1995, FRDK commenced a tender offer for all outstanding
shares of Wallace common stock, par value $1.00 per share (the "Shares"),
including the associated preferred stock purchase rights (the "Rights"), at $56
in cash per Share (as amended, the "Offer").
MOORE, FOLLOWING THE CONSUMMATION OF THE OFFER, INTENDS TO ACQUIRE BY
SECOND-STEP MERGER ALL OF WALLACE'S OUTSTANDING SHARES NOT TENDERED AND
PURCHASED PURSUANT TO THE OFFER FOR $56 PER SHARE IN CASH. SEE "BACKGROUND OF
PROPOSED ACQUISITION AND SOLICITATION."
At the Annual Meeting, three directors of Wallace will be elected.
Moore and FRDK are soliciting your proxy in support of the election of the
three nominees named below (the "Moore Nominees") as the directors of Wallace.
<PAGE> 4
Moore and FRDK are also soliciting your proxy in favor of three
stockholder resolutions (the "Stockholder Resolutions") FRDK plans to introduce
at the Annual Meeting for the purpose of: (i) removing all of the members of
the Board of Directors of Wallace (the "Wallace Board") other than the Moore
Nominees, if then directors of Wallace; (ii) amending the Amended and Restated
Bylaws of Wallace (the "Amended and Restated Wallace Bylaws") to fix the number
of directors at five; and (iii) repealing each provision of the Amended and
Restated Wallace Bylaws or amendment thereto adopted without approval of
Wallace stockholders subsequent to February 15, 1995 and prior to the Annual
Meeting.
The record date for determining stockholders entitled to notice of and
to vote at the Annual Meeting is [_________ __], 1995 (the "Record Date").
Stockholders of record at the close of business on the Record Date will be
entitled to one vote at the Annual Meeting for each Share held on the Record
Date. According to the preliminary proxy statement of Wallace filed with the
Securities and Exchange Commission on [_____________ ___], 1995 (the "Wallace
Proxy Statement"), there were ______________ Shares issued and outstanding as
of the close of business on the Record Date.
Moore is an Ontario corporation that is in the business of delivering
information handling products and services that are both paper-based and
electronic-based. FRDK is a New York corporation that was organized by Moore
to acquire Wallace and that has not conducted any unrelated activities since
its organization.
As of the date of this Proxy Statement, Moore beneficially owns 200
Shares, or approximately [___%] of the outstanding Shares on the Record Date,
and FRDK owns 150 Shares, or approximately [__%] of the outstanding Shares on
the Record Date. Other than as stated in the preceding sentence, none of
Moore, FRDK, any of their respective directors or officers, or the Moore
Nominees, or any of their respective associates, owns any securities of
Wallace, beneficially or of record, has purchased or sold any of such
securities within the past two years or is or was within the past year a party
to any contract, arrangement or understanding with any person with respect to
any such securities. The principal business address of both Moore and FRDK is
1 First Canadian Place, Suite 7200, Toronto, Ontario, M5X 1G5, Canada, and the
telephone number for each is (416) 364-2600.
Although Moore does not presently intend to alter the terms of the
Offer, it is possible that, depending on the facts and circumstances existing
at the time, the terms might be altered in one or more respects. It is not
possible at this time to determine whether, if Moore and FRDK should withdraw,
or materially amend the terms of the Offer prior to the Annual Meeting, Moore
and FRDK would continue to seek to elect the Moore Nominees or to seek adoption
of the Stockholder Resolutions. Moore and FRDK will, however, promptly
disseminate information regarding such changes, if any, to Wallace
stockholders.
________________________
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This Proxy Statement and the GOLD Annual Meeting proxy card are first
being furnished to Wallace stockholders on or about [_________ ___], 1995.
IMPORTANT
At the Annual Meeting, Moore and FRDK will seek (1) election of the
Moore Nominees as directors of Wallace and (2) approval of the Stockholder
Resolutions.
MOORE URGES YOU TO MARK, SIGN, DATE AND RETURN THE ENCLOSED GOLD
ANNUAL MEETING PROXY CARD TO VOTE FOR ELECTION OF THE MOORE NOMINEES AND FOR
APPROVAL OF THE STOCKHOLDER RESOLUTIONS.
A VOTE FOR THE MOORE NOMINEES AND THE STOCKHOLDER RESOLUTIONS WILL
ENABLE YOU -- AS THE OWNERS OF WALLACE -- TO TELL THE WALLACE BOARD THAT YOU
ARE IN FAVOR OF A SALE OR MERGER OF WALLACE.
MOORE URGES YOU NOT TO SIGN ANY PROXY CARD SENT TO YOU BY WALLACE. IF
YOU HAVE ALREADY DONE SO, YOU MAY REVOKE YOUR PROXY BY DELIVERING A WRITTEN
NOTICE OF REVOCATION OR A LATER DATED PROXY FOR THE ANNUAL MEETING TO MOORE,
C/O MACKENZIE PARTNERS, INC., 156 FIFTH AVENUE, NEW YORK 10010, OR TO THE
SECRETARY OF WALLACE, OR BY VOTING IN PERSON AT THE ANNUAL MEETING. SEE "PROXY
PROCEDURES" BELOW.
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<PAGE> 6
THE MOORE NOMINEES SUPPORT THE SALE OF WALLACE
Moore, through its wholly owned subsidiary, FRDK, has made a proposal
to acquire pursuant to the Offer and a second-step merger (the "Proposed
Merger") all of Wallace's outstanding Shares for $56 per Share in cash. The
Moore Nominees are committed to giving each Wallace stockholder the opportunity
to receive not less than $56 per Share for all of their Shares. In order to
permit the Offer to proceed, Moore needs the cooperation of the Wallace Board
to redeem the Rights or amend the Poison Pill (as hereinafter defined) to make
it inapplicable to the Offer and the Proposed Merger (the "Rights Condition"),
and to approve the Offer and the Proposed Merger for purposes of Section 203
("Section 203") of the Delaware General Corporation Law (the "Business
Combination Condition") and Article Ninth ("Article Ninth") of the Restated
Certificate of Incorporation (the "Restated Wallace Certificate of
Incorporation") of Wallace (the "Article Ninth Condition"). For information
about the Rights Condition, the Business Combination Condition and the Article
Ninth Condition, see "TERMS AND CONDITIONS OF THE OFFER".
If the Moore Nominees are elected and the Stockholder Resolutions are
approved, the Moore Nominees will constitute a majority of the five member
Wallace Board. Under the Restated Wallace Certificate of Incorporation and the
Amended and Restated Wallace Bylaws, a majority of the entire Wallace Board
constitutes a quorum, and action may be taken by the vote of a majority of the
directors when a quorum is present. Accordingly, if elected, the Moore
Nominees together with Moore would be able to take action to satisfy the Rights
Condition, the Business Combination Condition and the Article Ninth Condition
for the purpose of expediting prompt consummation of the Offer and the Proposed
Merger.
If the Moore Nominees are elected but the Stockholder Resolutions are
not approved, the Moore Nominees will constitute a minority of the eight member
Wallace Board and, accordingly, the Moore Nominees would not, without the
support of other members of the Wallace Board, be able to take action to
expedite prompt consummation of the Offer and Proposed Merger. Nonetheless, if
elected, the Moore Nominees will, subject to their fiduciary duties, seek to
convince other members of the Wallace Board to vote with them to arrange a
sale, merger or other similar transaction involving Wallace.
In the event that Moore Nominees are elected but the Stockholder
Resolutions are not approved, there can be no assurance that election of the
Moore Nominees alone will result in a sale of Wallace, in light of the
continuing opposition to the Offer by the current Wallace Board.
The foregoing description of the impact of your vote is qualified in
its entirety by any action that the Wallace Board may take between the date of
this Proxy Statement and the date of the Annual Meeting. Moore and FRDK intend
to supplement this Proxy Statement or otherwise publicly disseminate
information regarding any such action by the Wallace Board.
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<PAGE> 7
ELECTION OF DIRECTORS
According to publicly available information, Wallace currently has
eight Directors, three of whose terms will expire at the Annual Meeting.
If all Moore Nominees are elected and the Stockholder Resolutions are
approved, the Moore Nominees would constitute three of the possible five
members of the Wallace Board. The Moore Nominees are listed below and have
furnished the following information concerning their principal occupations or
employment and certain other matters. Each Moore Nominee, if elected, would
hold office until the 1998 Annual Meeting of Stockholders and until a successor
has been elected and qualified or until his earlier death, resignation or
removal. Although Moore has no reason to believe that any of the Moore
Nominees will be unable to serve as directors, if any one or more of the Moore
Nominees is not available for election, the persons named on the GOLD Annual
Meeting proxy card will vote for the election of such other nominees as may be
proposed by Moore and FRDK. Should Wallace purport to increase the number of
directors to be elected at the Annual Meeting, it is the current intention of
Moore and FRDK to propose additional nominees for such directorships.
MOORE NOMINEES FOR DIRECTORS
Principal Occupation and Business
Name, Age and Principal Experience During Last Five Years;
Business Address Current Directorships
-------------------------------- ----------------------------------
Curtis A. Hessler (51)................ Mr. Hessler has been Executive
The Times Mirror Company Vice President of The Times
Times Mirror Square Mirror Company, a publisher
Los Angeles, California 90035 of books, magazines and
newspapers since February 1991.
Mr. Hessler has announced that
he will soon be leaving this
position to pursue other
interests. Mr. Hessler was an
executive of UNISYS Corporation
from June 1984 to February 1991,
serving as Vice Chairman at the
time of his departure.
Albert W. Isenman III (47)............ Professor Isenman has been
Kellogg Graduate School of Professor of Management at
Management the Kellogg Graduate School of
Northwestern University Management at Northwestern
2001 Sheridan Road University since 1988.
Evanston, Illinois 60208
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<PAGE> 8
Robert P. Rittereiser (57)............ Mr. Rittereiser is Chairman of
450 Lexington Avenue Yorkville Associates Corp., a
New York, New York 10017 private investment and
financial advisory concern
formed in April 1989. He
served as Chairman since
November 1992, a Director since
1990 and President and Chief
Executive Officer from March
1993 until February 1995 of
Nationar, Inc., a banking
services corporation. On
February 6, 1995, the Acting
Superintendent of Banks, State
of New York, filed a Petition
in the New York Supreme Court
to take over the business of
Nationar. Prior to April 1989,
he was President and Chief
Executive Officer of E.F.
Hutton Group until its merger
with Shearson Lehman Brothers.
Until June 1985, he was
Executive Vice President and
Chief Administrative Officer of
Merrill Lynch & Co. Mr.
Rittereiser is a Director of
Ferrofluidics Corporation,
Interchange Financial Services,
Corp., CUC International Inc.
and the Main Stay Family of
Funds. He is a Trustee of the
DBL Liquidating Trust.
Based upon currently available public information, the election of the
Moore Nominees as directors of Wallace requires the affirmative vote of a
plurality of the Shares represented in person or by proxy at the Annual Meeting
and entitled to vote in the election of directors, assuming a quorum is present
at the Annual Meeting. Thus, assuming a quorum is present, the three persons
receiving the greatest number of votes will be elected to serve as directors
until the 1998 Annual Meeting. Non-voted shares with respect to the election
of directors will not affect the outcome of the election of directors.
As indicated under "BACKGROUND OF THE PROPOSED ACQUISITION", the
incumbent Wallace Directors have unanimously rejected Moore's $56 per Share all
cash proposal, but have not presented Wallace stockholders with any alternative
other than Wallace remaining independent.
MOORE BELIEVES THAT IT IS IN THE BEST INTEREST OF WALLACE STOCKHOLDERS
TO ELECT THE MOORE NOMINEES AT THE ANNUAL MEETING. THE MOORE NOMINEES ARE
COMMITTED TO GIVING EACH WALLACE STOCKHOLDER THE OPPORTUNITY TO RECEIVE NOT
LESS THAN $56 PER SHARE FOR ALL OF THEIR SHARES.
It is anticipated that each of the Moore Nominees, upon his election
as a director of Wallace, will receive director's fees consistent with
Wallace's past practice. Moore has paid each of the Moore Nominees $50,000 in
consideration of his time and effort involved in serving as a Moore Nominee.
In addition, Moore has agreed to indemnify each of the Moore Nominees against
any and all losses, claims, damages, judgments, liabilities and expenses of any
kind which may be incurred arising out of or relating to his service as a Moore
Nominee.
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<PAGE> 9
None of the Moore Nominees (i) has any arrangements or understandings
with any person or persons with respect to any future employment by Wallace or
its affiliates, or with respect to any future transactions to which Wallace or
any of its affiliates may be a party; (ii) has carried on any occupation or
employment with Wallace or any corporation or organization which is or was a
parent, subsidiary or other affiliate of Wallace; (iii) has received any cash
compensation, cash bonuses, deferred compensation, compensation pursuant to
plans, or other compensation, from, or in respect of, services rendered to or
on behalf of Wallace; (iv) since August 1, 1994, has engaged in or has a direct
or indirect material interest in any transaction or series of similar
transactions to which Wallace or any of its subsidiaries was or is to be a
party in which the dollar amount involved exceeded, or is expected to exceed,
$60,000 in the aggregate; (v) since August 1, 1994, has been indebted to
Wallace or any of its subsidiaries in an amount in excess of $60,000; or (vi)
is a party adverse to Wallace or any of its subsidiaries in any material
proceedings or has a material interest adverse to the interest of Wallace or
any of its subsidiaries in any such proceedings. No family relationships exist
among the Moore Nominees or between any of the Moore Nominees and any director
or executive officer of Wallace.
The accompanying GOLD Annual Meeting proxy card will be voted at the
Annual Meeting in accordance with your instructions on such card. You may vote
FOR the election of the Moore Nominees as directors of Wallace or withhold
authority to vote for the election of the Moore Nominees by marking the proper
box on the GOLD Annual Meeting proxy card. You may also withhold your vote
from any of the Moore Nominees by writing the name of such nominee in the space
provided on the GOLD Annual Meeting proxy card. IF NO MARKING IS MADE, YOU
WILL BE DEEMED TO HAVE GIVEN A DIRECTION TO VOTE THE SHARES REPRESENTED BY THE
GOLD ANNUAL MEETING PROXY CARD FOR THE ELECTION OF ALL OF THE MOORE NOMINEES
PROVIDED THAT YOU HAVE SIGNED AND DATED THE PROXY CARD.
IF YOU BELIEVE THAT YOU SHOULD HAVE THE OPPORTUNITY TO RECEIVE NOT
LESS THAN $56 PER SHARE FOR ALL OF YOUR SHARES, MOORE URGES YOU TO VOTE YOUR
GOLD ANNUAL MEETING PROXY CARD FOR EACH OF THE MOORE NOMINEES. THE MOORE
NOMINEES ARE COMMITTED TO GIVING EACH WALLACE STOCKHOLDER THE OPPORTUNITY TO
RECEIVE NOT LESS THAN $56 PER SHARE FOR EACH OF THEIR SHARES.
MOORE STRONGLY RECOMMENDS A VOTE FOR THE ELECTION OF THE MOORE NOMINEES.
THE STOCKHOLDER RESOLUTIONS
FRDK intends to present the following Stockholder Resolutions for
adoption by Wallace stockholders at the Annual Meeting:
"RESOLVED: That all of the directors of Wallace Computer
Services, Inc. ("Wallace") other than Curtis A.
Hessler, Albert W. Isenman, III and Robert P.
Rittereiser, if then directors of Wallace, be
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<PAGE> 10
removed without cause, effective at the time this
resolution is approved."
"RESOLVED: That the Amended and Restated Bylaws (the "Bylaws")
of Wallace, be and they hereby are amended, effective
at the time this resolution is approved, by amending
the first sentence of Section 3.2(a) of the Bylaws in
its entirety to read as follows:
Section 3.2. Number, Election, Tenure and
Qualifications; Stockholder Nominations;
Vacancies; Removal; Resignation.
(a) Number, Election, Tenure and
Qualifications. Subject to any special
rights of the holders of preferred stock to
elect additional directors, the Board of
Directors shall consist of five members."
"RESOLVED: That each provision of the Bylaws or amendment
thereto adopted by the Board of Directors of Wallace
without the approval of stockholders subsequent to
February 15, 1995 and prior to the approval of this
resolution be, and it hereby is, repealed, effective
at the time this resolution is approved."
THE PURPOSE OF THE STOCKHOLDER RESOLUTIONS IS TO GIVE WALLACE
STOCKHOLDERS THE OPPORTUNITY TO TELL THE WALLACE BOARD THAT THEY WILL SUPPORT
THE SALE OF WALLACE AT A PRICE OF NOT LESS THAN $56 PER SHARE AND TO TAKE SUCH
STEPS AS ARE NECESSARY TO PERMIT THE OFFER AND PROPOSED MERGER TO PROCEED.
The effect of the first two Stockholder Resolutions is to provide the
Moore Nominees with the ability, together with Moore, to take action to satisfy
the Rights Condition, the Business Combination Condition and the Article Ninth
Condition for the purpose of expediting prompt consummation of the Offer and
the Proposed Merger. The effect of the third Stockholder Resolution is to
repeal the Stockholder Notice Requirement (as hereinafter defined) so as to
allow stockholders to introduce business at annual meetings of Wallace without
the requirement of providing notice to Wallace at least 60 days prior to such
meeting. See "BACKGROUND OF PROPOSED ACQUISITION AND SOLICITATION --
BACKGROUND OF THE OFFER".
Based on currently available public information, (i) adoption of the
first two Stockholder Resolutions requires the affirmative vote of 80% of all
outstanding Shares, and (ii) adoption of the third Resolution requires the
affirmative vote of a majority of the Shares represented in person or by proxy
and entitled to vote, assuming the presence of a quorum at the Annual Meeting.
With respect to abstentions and broker non-votes, the Shares will be considered
present at the Annual Meeting, but since they are not affirmative votes for the
Stockholder Resolutions, they will have the same effect as votes against the
Stockholder Resolutions.
The accompanying GOLD Annual Meeting proxy card will be voted in
accordance with your instructions on such card at the Annual Meeting. You may
vote FOR the Stockholder Resolutions or vote against, or abstain from voting
on, the Stockholder Resolutions by marking the proper box on the GOLD proxy
card for the Annual Meeting. If no marking is made, you will be deemed to have
given a direction to vote the Shares represented by the GOLD proxy card FOR
the Stockholder Resolutions provided that you have signed and dated the proxy
card.
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<PAGE> 11
MOORE STRONGLY RECOMMENDS A VOTE
FOR THE STOCKHOLDER RESOLUTIONS.
OTHER MATTERS TO BE CONSIDERED
AT THE ANNUAL MEETING
Except as set forth above, Moore and FRDK are not aware of any
proposals to be brought before the Annual Meeting. Should other proposals be
brought before the Annual Meeting, the persons named on the GOLD Annual Meeting
proxy card will vote on such proposals in their discretion.
PROXY PROCEDURES
Stockholders are urged to mark, sign and date the enclosed GOLD Annual
Meeting proxy card and return it to Moore, c/o MacKenzie Partners, Inc., 156
Fifth Avenue, 9th Floor, New York, New York 10010 in the enclosed envelope in
time to be voted at the Annual Meeting. Execution of the GOLD Annual Meeting
proxy card will not affect your right to attend the Annual Meeting and to vote
in person. Any proxy may be revoked at any time prior to the Annual Meeting by
delivering a written notice of revocation or a later dated proxy at the
particular meeting. Only your latest dated proxy for the Annual Meeting will
count.
Only holders of record as of the close of business on the Record
Date will be entitled to vote. If you were a stockholder of record on the
Record Date, you may vote your Shares at the Annual Meeting even if you have
sold your Shares before or after the Record Date. Accordingly, please vote the
Shares held by you on the Record Date, or grant a proxy to vote such Shares, on
the GOLD Annual Meeting proxy card, even if you have sold your Shares before or
after the Record Date.
If any of your Shares are held in the name of a brokerage firm, bank,
bank nominee or other institution on the Record Date, only it can vote such
Shares and only upon receipt of your specific instructions. Accordingly,
please contact the person responsible for your account and instruct that person
to execute on your behalf the GOLD Annual Meeting proxy card.
BACKGROUND OF PROPOSED ACQUISITION AND SOLICITATION
BACKGROUND OF THE OFFER
As set forth in Section 11 of the Offer to Purchase dated August 2,
1995 (the "Offer to Purchase") relating to the Offer, within the past year,
management of Moore determined that an acquisition or other business
combination with a company in the business forms industry would be in the best
interests of Moore and its stockholders. In
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<PAGE> 12
February of 1995, Lazard Freres & Co. LLC ("Lazard Freres") was requested by
Moore to identify individuals affiliated with Wallace who might be contacted to
explore a business combination proposal.
On February 15, 1995, a representative of Lazard Freres contacted Mr.
Neele Stearns, a Director of Wallace, to discuss the possibility of Mr.
Stearns' arranging a meeting between Mr. Reto Braun, Chief Executive Officer of
Moore, and Robert J. Cronin, Chief Executive Officer of Wallace, for the
purpose of discussing the feasibility of a business combination involving
Wallace and Moore. The Lazard Freres representative and Mr. Stearns met on
March 2, 1995 to discuss, among other matters, such a combination and had a few
follow-up conversations on the same subject over the next several weeks.
At the suggestion of Mr. Stearns, on February 24, 1995, Mr. Braun,
Chief Executive Officer, wrote to Mr. Cronin to request a meeting to discuss
the merits of a business combination involving Wallace and Moore. Mr. Cronin
subsequently contacted Mr. Braun to advise Mr. Braun that Mr. Cronin had
reviewed with the Wallace Board the proposal to discuss a business combination
and that the Wallace Board was not interested in pursuing any such discussions
at that time. Nevertheless, Mr. Cronin indicated that he would be interested in
meeting Mr. Braun over lunch. Following that conversation, the Lazard Freres
representative received confirmation from Mr. Stearns that Wallace was not
interested in proceeding with discussions on a business combination.
On April 18, 1995, Messrs. Braun and Cronin spoke together briefly at
an industry trade conference during which conversation the subject of a
business combination involving Wallace and Moore was not discussed; however,
Messrs. Braun and Cronin reconfirmed their mutual desire to have lunch to
discuss opportunities for business cooperation.
From April 20, 1995 to June 26, 1995, Mr. Braun attempted on numerous
occasions to arrange a lunch with Mr. Cronin, only to have the lunch postponed
repeatedly. Finally, on June 26, 1995, Mr. Cronin called Mr. Braun offering to
meet him on certain dates in August 1995. Mr. Braun accepted an opportunity to
meet with Mr. Cronin on August 8, 1995, the earliest date offered to him by Mr.
Cronin.
On July 18, 1995, Wallace filed with the Securities and Exchange
Commission a Current Report on Form 8-K containing (i) the Amended and Restated
Wallace Bylaws purportedly effective as of June 14, 1995, and (ii) an
Employment Agreement made and entered into effective as of January 1, 1995
between Wallace and Mr. Cronin (the "Cronin Employment Agreement").
The Amended and Restated Wallace Bylaws, among other things, added a
provision (the "Stockholder Notice Requirement") purporting to require that
stockholders of Wallace desiring to introduce business at any annual meeting of
Wallace deliver notice to the Secretary of Wallace not later than sixty, and
not earlier than ninety, days in advance of such meeting. The Amended and
Restated Wallace Bylaws further stated that the chairman of the annual meeting
shall, if the facts warrant, determine and declare to
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<PAGE> 13
the meeting that business was not properly brought before the meeting in
accordance with the provisions of the Amended and Restated Wallace Bylaws, and
that if he should so determine, he shall so declare to the meeting and any such
business not properly brought before the meeting shall not be transacted.
The Cronin Employment Agreement provides for a term of employment
which runs from January 1, 1995 to December 31, 1999 and provides for certain
termination payments upon the occurrence of certain specified events, including
changes of control such as the Proposed Merger. See "BACKGROUND OF PROPOSED
ACQUISITION AND SOLICITATION -- CHANGE IN CONTROL."
On July 26, 1995, FRDK purchased 150 Shares at a price per Share of
$42-5/8, and Moore purchased 200 Shares at a price per Share of $42-5/8.
On July 30, 1995, Mr. Braun called Mr. Cronin to inform him of the
Offer, but Mr. Cronin was not available.
Mr. Braun then attempted to reach Mr. Theodore Dimitriou, Chairman of
the Wallace Board. Mr. Braun was unable to reach Mr. Dimitriou.
On July 30, 1995, Moore announced its intention to commence the Offer
by issuing the following press release:
MOORE CORPORATION ANNOUNCES INTENTION TO ACQUIRE WALLACE
COMPUTER SERVICES FOR $56.00 CASH PER SHARE
Toronto, Canada, July 30, 1995 -- Moore Corporation Limited
(TSE, NYSE, ME: MCL) announced today its intention to commence a
tender offer for all of the outstanding common stock of Wallace
Computer Services (NYSE: WCS) for $56.00 per share in cash. With 23
million Wallace shares outstanding, the total transaction is valued at
approximately $1.3 billion.
Moore communicated its intention to launch its offer in a
letter sent today to Wallace's Chairman, Theodore Dimitriou and its
CEO Robert Cronin:
Dear Mr. Dimitriou and Mr. Cronin:
As you know from our prior communications, the Board of
Directors and management of Moore Corporation believe the combination
of our two companies makes eminent business sense. Unfortunately, your
Board specifically rejected our proposal to discuss a strategic
business combination. We therefore felt we had no choice but to
proceed with an offer directly to your stockholders. We continue to
believe it is in the best interests of both companies to move
expeditiously toward a mutually-agreed combination of our companies.
This week we will commence an offer to purchase all of the
outstanding common stock of Wallace at $56.00 per share in cash, a
total of approximately $1.3 billion. This offer represents an 84%
premium over your share price on
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<PAGE> 14
February 24, 1995 when we first contacted you regarding a business
combination, and 42% over your most recent 30-day average closing
price. In the interim, we have noted your favorable results and our
price reflects both your recent and anticipated performance. We are
confident that your stockholders will find our offer compelling.
As you know, Moore is the acknowledged global leader in our
industry. As a 113 year old corporation, Moore operates in 59
countries with over 100 manufacturing facilities. Over the past two
years, we have been redirecting our energies and resources to meet the
rapidly changing information handling technologies and demands of our
customers and increase our rate of growth. We have made excellent
progress. And we have noted with interest your similar efforts and
progress.
We believe the combination of Moore's strengths with Wallace's
would accelerate our mutual efforts, creating a new entity capable of
providing the full spectrum of integrated products and service
offerings that today's customers demand on a global basis.
Together, we would redefine the industry. The new entity would
be far more than the sum of its parts. In the United States, our
respective operations are complementary in three targeted growth
areas: total forms and print management; labels; and personalized
direct mail. Our combined capabilities in these core areas would give
the new entity a significant competitive opportunity, enabling us to
fully serve the needs of any organization. Together, we would
simultaneously expand our sales to our respective existing customers
and appeal to new ones. Overseas, we would be able to leverage
exponentially the combined products, services and technological
advantages with Moore's existing customer base.
The combination of our two entities would benefit from Moore's:
- World-wide market leader position with global Fortune
1000 customers
- Unique electronic solutions capabilities, through the
JetForm equity alliance.
- Proprietary research and technologies in variable
digital network color printing, global print
management distribution network, linerless labels,
direct personalized marketing, statement processing
and distribution.
- Partnership and strategic alliances with worldwide
market and technology leaders -- Datamax, Indigo, EDS
and Toppan Moore.
- Financial strength, continued investment in capital and
technology, and scope of resources.
12
<PAGE> 15
In sum, the new entity would be ideally positioned to compete
successfully in the global marketplace of the future.
As a result of the provision in your bylaws which requires
advance notice of Board nominees, later today we will be delivering a
notice identifying three nominees for the upcoming annual meeting of
stockholders. Our nominees will be dedicated to implementing our
proposed transaction, consistent with their fiduciary duties. Our
attorneys also advise me we will be filing certain litigation relating
to your defensive provisions.
We have the highest regard for you and your management team,
which we believe would find a professionally exciting and
rewarding environment at the combined entity, and we hope and expect
that your team would remain in place. The complementary nature of our
operations would make integration straightforward and would create
exciting new opportunities for employees of the combined entity. And,
of course, our commitment to the U.S. would remain strong.
We stand ready to meet with you and Wallace Board and
management at any time to discuss any aspect of our proposed
combination so that you will share our confidence and enthusiasm for
this transaction -- a transaction that serves the best interests of
both of our companies and our stockholders, employees, customers and
communities.
Sincerely,
Reto Braun
cc: Wallace Board of Directors
Moore announced it will be commencing litigation against
Wallace and its Board of Directors in the United States District Court
for the District of Delaware. The litigation will seek, among other
things, an order compelling the Board of Directors to redeem Wallace's
"poison pill" or to make it inapplicable to Moore's offer and the
merger it expects to consummate upon successful conclusion of its
offer and not otherwise to impede the offer, the proposed merger or
the proxy solicitation Moore intends to pursue.
Moore is being advised in the transaction by Lazard Freres &
Co. LLC and RBC Dominion Securities.
Moore Corporation Limited (TSE, ME, NYSE: MCL) is a global
leader in delivering information handling products and services
that create efficiency and enhance competitiveness for customers.
Founded in Toronto in 1882, Moore has
13
<PAGE> 16
approximately 20,000 employees and over 100 manufacturing facilities
serving customers in 59 countries. Sales in 1994 were US$2.4 billion.
On July 30, 1995, a representative of Lazard Freres telephoned Mr.
Stearns and informed him of the Offer.
On July 31, 1995, the letter described in the foregoing press release
was delivered to Mr. Cronin and Mr. Dimitriou, with copies to the other members
of the Wallace Board.
On July 31, 1995, FRDK delivered a letter to Wallace pursuant to
Section 3.3 of the Amended and Restated Wallace Bylaws, notifying Wallace that
it intended to nominate the Moore Nominees for election to the Wallace Board at
the Annual Meeting. The letter set forth the intention of the Moore Nominees to
(a) redeem the Rights issued under the Poison Pill (as hereinafter defined) or
to make the Rights inapplicable to the Offer and the Proposed Merger, approve
the Offer and the Proposed Merger under Section 203, take any action desirable
or necessary for satisfaction of the requirements under Article Ninth, and take
such other actions and seek or grant such other consents or approvals as may be
desirable or necessary to expedite prompt consummation of the Offer and the
Proposed Merger or (b) if any other transaction offering more value to
Wallace's stockholders were to be proposed, take actions to facilitate such a
transaction, in each case subject to fulfillment of the fiduciary duties that
they would have as directors of Wallace. FRDK further advised Wallace of its
intent to notify Wallace, in accordance with the Amended and Restated Wallace
Bylaws, of its intent to introduce the Stockholder Resolutions at the Annual
Meeting.
On July 31, 1995, Moore and FRDK commenced litigation against Wallace
and the Wallace Board in the United States District Court for the District of
Delaware seeking, among other things, an order compelling the Wallace Board to
redeem the Rights or to amend the Poison Pill to make the Rights inapplicable
to the Offer and the Proposed Merger, to approve the Proposed Merger pursuant
to Article Ninth and to approve the Offer and Proposed Merger for purposes of
Section 203.
On July 31, 1995, Mr. Cronin sent the following letter to Mr. Braun:
Dear Mr. Braun:
We have received your letter dated July 30, 1995 in which you
have proposed an acquisition of Wallace Computer Services, Inc. at $56
per share in cash. With the assistance of financial and legal
advisors, the Board of Directors of Wallace will consider the proposal
in due course. Goldman, Sachs & Co. has been retained in this regard.
After the Board has determined its position with respect to the
proposal, we will so inform you. If appropriate at that time, we will
also respond to various assertions in your letter and public
statements.
14
<PAGE> 17
Sincerely,
Robert J. Cronin
President and
Chief Executive Officer
On August 2, 1995, Moore commenced the Offer and filed a Premerger
Notification and Report Form with the Federal Trade Commission and the
Department of Justice under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR Act").
On August 3, 1995, Mr. Cronin canceled the luncheon meeting with Mr.
Braun that had been previously scheduled to be held on August 8, 1995.
On August 3, 1995, Moore obtained the commitment of The Bank of Nova
Scotia for a $1.1 billion financing facility to finance the Offer and the
Proposed Merger.
On August 10, 1995, FRDK waived the financing condition to the Offer
and Moore and FRDK entered into definitive financing agreements with The Bank
of Nova Scotia, as agent for the lenders for a $1.1 billion loan facility to
finance the Offer and the Proposed Merger.
On August 15, 1995, Wallace issued a press release, filed a complaint
against Moore and FRDK in the United States District Court for the Southern
District of New York (the "Wallace Action"), and filed a
Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule 14D-9")
with the Securities and Exchange Commission, stating the recommendation by the
Wallace Board that stockholders reject the Offer and the belief by the Wallace
Board that the interests of the stockholders will be best served by Wallace's
continued pursuit of its strategic plans, and the Board's intention not to seek
to sell Wallace to Moore or any other buyer, but rather to continue the
business of Wallace as an independent entity.
As stated in the Schedule 14D-9, the Wallace Action asserts that (i)
the transactions contemplated by the Offer to Purchase may substantially lessen
competition in a relevant market and therefore violate Section 7 of the Clayton
Act, 15 U.S.C. Section 18; and (ii) Moore and FRDK have made false and
misleading statements of fact in connection with the Offer. The Wallace Action
seeks declaratory relief and injunctive relief preliminarily and permanently
enjoining Moore and FRDK (i) from acquiring any voting securities of Wallace,
and (ii) from soliciting, acquiring, or attempting to acquire in any manner,
any Shares until 60 days after they have fully complied with the Securities
Exchange Act of 1934, as amended.
On August 17, 1995, the waiting period under the HSR Act expired
without further inquiry by the U.S. Department of Justice, satisfying the
pre-clearance requirements under the U.S. antitrust laws for Moore's purchase
of the Shares pursuant to the Offer and the Proposed Merger.
15
<PAGE> 18
On August 21, 1995, a representative from Lazard Freres, on behalf of
Moore and FRDK, contacted a representative from Goldman, Sachs & Co. ("Goldman
Sachs"), Wallace's financial advisor in connection with the Offer, to suggest
that Lazard Freres and Goldman Sachs, Wallace, Moore and FRDK or any
combination thereof schedule a meeting to discuss the Offer. On August 26,
1995, the Goldman Sachs representative advised the Lazard Freres representative
that the Wallace Board had rejected Moore's and FRDK's suggestion to meet in
order to discuss the Offer.
On August 28, 1995, Moore issued a press release extending the Offer
until Tuesday, September 19, 1995 and stating that it remained committed to its
proposed acquisition of Wallace. The press release included the following:
We had invited Wallace's Board and advisors to meet with us to
demonstrate why they believe our $56 per share offer is "inadequate."
As we have said many times in public and in private, we remain open to
the possibility that the Board will elect to sit down with us in the
near future and are ready at any time to discuss any aspect of our
proposed combination. In the meantime, Moore will proceed with the
necessary steps to facilitate its effort to acquire Wallace.
On September 6, 1995, the Wallace Board approved and adopted
amendments to certain of its employee benefit plans, including its employee
profit sharing plan and its long-term performance plan. The Wallace Board also
approved and adopted an amendment to its employee severance pay plan to provide
that the amount of severance payable to certain participants shall not be less
than one year's compensation upon the occurrence of certain events following a
change in control of Wallace, irrespective of their seniority with Wallace. The
Compensation Committee of the Wallace Board designated 37 participants for
this purpose. See "BACKGROUND OF PROPOSED ACQUISITION AND SOLICITATION --
CHANGE OF CONTROL."
Moore intends to continue to seek to negotiate with Wallace with
respect to its acquisition proposal. If such negotiations result in a
definitive merger or other agreement between Moore and Wallace, such
negotiations could result in, among other things, termination of this proxy
solicitation.
Although Moore does not presently intend to alter the terms of the
Offer, it is possible that, depending on the facts and circumstances existing
at the time, the terms might be altered in one or more respects. It is not
possible at this time to determine whether, if Moore and FRDK should withdraw,
or materially amend, the terms of the Offer prior to the Annual Meeting, Moore
would continue to seek to elect the Moore Nominees or to seek adoption of the
Stockholder Resolutions. Moore, however, will disseminate information
regarding such changes, if any, to Wallace stockholders.
Moore and FRDK urge you to obtain a copy of the Offer to Purchase, the
Letter of Transmittal and the other Offer documents from the Agent (as
hereinafter defined) at the address and telephone number set forth on the back
cover of this Proxy Statement.
16
<PAGE> 19
CHANGE IN CONTROL
The Cronin Employment Agreement requires that Mr. Cronin be paid
various payments and receive additional benefits upon the occurrence of certain
specified events relating to a change in the ownership or control of Wallace.
If, for example, a change of control such as the Proposed Merger occurs and Mr.
Cronin is not employed with substantially the same duties and responsibilities
he had before the change in control, he can terminate his employment and
receive the salary, bonuses and other compensation he would have received under
the Cronin Employment Agreement through the last day of its term. He would
also be entitled to additional benefits including a "gross-up" for excise taxes
(as well as taxes on payments to him for the purpose of paying the excise
taxes) he is assessed under the "golden parachute" provisions of the Internal
Revenue Code of 1986, as amended.
Under the Executive Pay Plan (as hereafter defined), Mr. Cronin and
other Wallace executives would receive one or two years' compensation if, within
two years of a change in control, the executive's employment terminates
voluntarily or involuntarily (for reasons other than death or cause). These
payments would be "grossed-up" for excise taxes (as well as taxes on payments to
the executive for the purpose of paying the excise taxes). It is estimated that
the total cost to Wallace of Mr. Cronin's termination and severance payments
could exceed $[______], or approximately $[______] per Share based upon the
number of outstanding Shares as of the Record Date.
In addition, on September 6, 1995, the Wallace Board approved and
adopted amendments to the following Wallace employee benefit plans: the Wallace
Computer Services, Inc. Employee Severance Pay Plan, the Wallace Computer
Services, Inc. Executive Severance Pay Plan (the "Executive Pay Plan"), the
Wallace Computer Services, Inc. Executive Incentive Plan, the Wallace Computer
Services, Inc. Compensation/Capital Accumulation Plans for 1990, 1991, 1993,
1994 and 1995, the Wallace Computer Services, Inc. Profit Sharing and Retirement
Trust Plan and the Wallace Computer Services, Inc. Long-Term Performance Plan
(the "LTP Plan") (collectively, the "Plans").
The Wallace Board also approved the reclassification under the
Executive Pay Plan of four employees that were not executive officers of
Wallace, doubling severance for such employees to two years' annual salary.
In addition, the Wallace Board amended the LTP Plan to provide, among
other things, that "(i) a plan participant's accrued bonus balance under the
LTP Plan will not be reduced below the amount of the plan participant's accrued
bonus balance as calculated after inclusion of the plan participant's award, if
any for the Plan Year (as defined in the LTP Plan) immediately preceding the
Plan Year in which the Material Change occurs, and (ii) an individual who is a
plan participant immediately prior to the occurrence of a Material Change
("Protected Participant") will be entitled to receive payment of such
particpant's accrued bonus balance, if, at any time during the two-year period
beginning
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<PAGE> 20
on the date that the Material Change occurs, the Protected Participant's
employment with the Company terminates, whether voluntarily or involuntarily,
for any reason other than for Cause (as defined in Amendment No. 1 [to the LTP
Plan]) or on account of the Protected Participant's death or permanent
disability."
It is estimated that the total cost to Wallace of the amendments to
the Plans adopted by Wallace's Board could exceed $[_______] in the aggregate,
or approximately $[______] per Share based upon the number of outstanding
Shares on the Record Date.
When taken together with the potential payments to be made by Wallace
to Mr. Cronin, the total costs of the amendments to the Plans could exceed
$[_______] in the aggregate, or approximately $[________] per Share based upon
the number of Shares outstanding on the Record Date.
ENGAGEMENT OF FINANCIAL ADVISORS
Lazard Freres is acting as Dealer Manager in connection with the Offer
and is providing certain financial advisory services to Moore and FRDK in
connection with the Offer. Moore has agreed to pay Lazard Freres as
compensation for such services (a) $1,000,000, which became payable upon the
commencement of the Offer and against which the sum of $250,000 has been
credited in respect of amounts previously paid by Moore to Lazard Freres for
other services performed by Lazard Freres; and (b) an additional $4,000,000
payable upon the earlier of (i) the acquisition of beneficial ownership of more
than 50% of the Shares in the Offer, and (ii) the consummation of the direct or
indirect acquisition (by merger or otherwise) of all or a substantial portion
of the stock or assets of Wallace, or all or a substantial portion of the stock
or assets of a subsidiary or division of Wallace. Moore has also agreed to
reimburse Lazard Freres for its reasonable out-of-pocket expenses, including
the reasonable fees and expenses of its legal counsel, and to indemnify Lazard
Freres and certain related persons against certain liabilities and expenses,
including certain liabilities and expenses under the Federal securities laws.
In addition, RBC Dominion Securities ("Dominion") is providing certain
financial advisory services to Moore and FRDK in connection with the Offer.
Moore has agreed to pay Dominion as compensation for such services (a) a
retainer fee of $100,000, (b) $150,000, which became payable upon Moore's
announcement of the intention to commence the Offer, and (c) $750,000, payable
on consummation of the Offer. Moore has also agreed to reimburse Dominion for
its reasonable out-of-pocket expenses, including the reasonable fees and
disbursements of its legal counsel, and to indemnify Dominion and certain
related persons against certain liabilities and expenses, including certain
liabilities and expenses under the Federal securities laws.
TERMS AND CONDITIONS OF THE OFFER
18
<PAGE> 21
On August 2, 1995, Moore and FRDK commenced the Offer for all
outstanding Shares at a purchase price of $56 per Share (and associated Right),
net to the seller in cash. As stated in the Offer to Purchase, the purpose of
the Offer is to enable Moore to acquire control of, and the entire equity
interest in, the Company. The Offer, as the first step in the acquisition of
the Company, is intended to facilitate the acquisition of all of the Shares.
Moore currently intends, as soon as practicable following consummation of the
Offer, to seek to consummate the Proposed Merger. The purpose of the Proposed
Merger is to acquire all Shares not tendered and purchased pursuant to the
Offer or otherwise. Pursuant to the Proposed Merger, each then outstanding
Share (other than Shares owned by FRDK, Moore or any of their subsidiaries,
Shares held in the treasury of Wallace and Shares owned by stockholders who
perfect any available appraisal rights under the Delaware General Corporation
Law) will be converted into the right to receive an amount in cash equal to the
price per Share paid pursuant to the Offer.
The Offer is conditioned, among other things, upon the following:
(1) The Minimum Tender Condition. There must be validly tendered
and not withdrawn prior to the Expiration Date a number of Shares which
constitutes at least a majority of the Shares outstanding on a fully diluted
basis on the date of purchase, without giving effect to any dilution that might
arise from exercise of the Rights.
(2) The Rights Condition. On March 14, 1990, Wallace adopted a
Rights Agreement, commonly referred to as a "Poison Pill," pursuant to which
the Rights were created. Pursuant to the Rights Condition, the Rights must be
redeemed by Wallace's Board of Directors, or Moore and FRDK must be satisfied,
in their sole discretion, that the Rights have been invalidated or otherwise
are inapplicable to the Offer and the Proposed Merger.
The Poison Pill provides that, until the close of business on the date
that the Rights are distributed (the "Distribution Date"), the Rights will be
evidenced by the certificates for the Shares to which the Rights are attached.
Until such time (or earlier redemption, or expiration of the Rights), the
surrender for transfer of any certificates for Shares will also constitute the
surrender for transfer of the Rights associated with the Shares represented by
such certificates. The Poison Pill further provides that, as soon as
practicable following the Distribution Date, separate certificates representing
the Rights will be mailed to holders of record of Shares as of the close of
business on the Distribution Date.
The Poison Pill further provides that, subject to certain exceptions,
at any time prior to the close of business on the earlier of (a) the tenth day
following a public announcement that a person or group of affiliated or
associated persons has acquired beneficial ownership of 20% or more (or such
lower beneficial ownership threshold not less than 10% as may be established
through an amendment of the Poison Pill) of the outstanding Shares (an
"Acquiring Person"), and (b) March 31, 2000, the Wallace Board may redeem the
Rights in whole, but not in part, at a price of $.01 per Right payable in cash;
provided, however, that any election to redeem the Rights after the
announcement
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<PAGE> 22
that a person has become an Acquiring Person must be made by a majority of the
independent members of the Wallace Board.
As set forth in the Schedule 14D-9, the Wallace Board resolved to
delay the Distribution Date until the later to occur of (i) the close of
business one day prior to any publicly announced expiration date of the Offer
and (ii) such other time as the Wallace Board or any duly authorized committee
thereof shall designate. Accordingly, Moore and FRDK believe that, as of
September 6, 1995, the Distribution Date had not occurred, the Rights were not
exercisable, separate certificates for Rights had not been issued and the
Rights were evidenced by the certificates for Shares to which the Rights are
attached.
(3) The Business Combination Condition. Under the Business
Combination Condition, the acquisition of Shares pursuant to the Offer and the
Proposed Merger must have been approved pursuant to Section 203 or Moore and
FRDK must be satisfied, in their sole discretion, that the provisions of
Section 203 are otherwise inapplicable to the acquisition of Shares pursuant to
the Offer and the Proposed Merger.
Subject to certain exceptions, Section 203 provides, in effect, that
if either Moore or FRDK acquires beneficial ownership of 15% or more of the
outstanding Shares (thereby becoming an "Interested Stockholder"), neither
Moore nor FRDK, respectively, could engage in a business combination (defined
to include a variety of transactions, including mergers such as the Proposed
Merger) with Wallace or any affiliate of Wallace for three years after Moore or
FRDK, respectively, became an Interested Stockholder. The three-year
prohibition would not apply to the Offer or the Proposed Merger, if, among
other things, the Wallace Board adopts a resolution approving the Proposed
Merger, provided that such resolution is adopted prior to the date that Moore
or FRDK becomes an Interested Stockholder.
(4) The Article Ninth Condition. Under the Article Ninth
Condition, the Proposed Merger must be approved pursuant to Article Ninth, or
Moore and FRDK must be satisfied, in their sole discretion, that the provisions
of Article Ninth are otherwise inapplicable to the Proposed Merger.
Article Ninth requires that the holders of at least 80% of the
combined voting power of the outstanding stock of Wallace entitled to vote
generally in the election of directors (the "Voting Stock") approve mergers and
certain other transactions involving an Interested Shareholder unless either
the transaction is (i) approved by a majority of the members of Wallace Board
and certain of their successors that are not affiliated with such Interested
Shareholder and its affiliates and was a director prior to the time that the
Interested Shareholder became an Interested Shareholder (the "Disinterested
Directors"), or (ii) certain specified price criteria and procedural
requirements are met.
For the purposes of Article Ninth, an "Interested Shareholder" is
defined as any person (other than Wallace, or any subsidiary, or any
profit-sharing, employee stock ownership or other employee benefit plan of
Wallace or any subsidiary) who (i) is the beneficial owner of Voting Stock
representing more than 20% of the combined voting power of the Voting Stock, or
(ii) is an affiliate of Wallace and at any time within the
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<PAGE> 23
prior two-year period was the beneficial owner of Voting Stock representing
more than 20% of the combined voting power of the then outstanding Voting
Stock, or (iii) is an assignee of or has succeeded to any shares of Voting
Stock in a transaction not involving a public offering which were at any time
within the prior two-year period beneficially owned by an Interested
Shareholder.
The 80% affirmative stockholder vote would not be required if either
(i) the transaction has been approved by a majority of the Disinterested
Directors or (ii) certain specified price criteria and procedural requirements
are met.
THE FOREGOING IS A SUMMARY OF THE POISON PILL, SECTION 203 AND ARTICLE
NINTH AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE THERETO.
The Offer is also subject to other terms and conditions which are
described in the Offer to Purchase and the related Letter of Transmittal,
copies of which are available from the Agent at the address and telephone
numbers set forth on the back cover of this Proxy Statement. Moore and FRDK
urge you to obtain a copy of the Offer to Purchase, the Letter of Transmittal
and the other Offer documents.
In the Offer to Purchase, Moore and FRDK requested the Wallace Board
to satisfy: (i) the Rights Condition by redeeming the Rights or amending the
"Poison Pill" to make the Rights inapplicable to the Offer; (ii) the Business
Combination Condition by adopting a resolution approving the Offer and the
Proposed Merger for the purposes of Section 203; and (iii) the Article Ninth
Condition by approving the Proposed Merger pursuant to Article Ninth of the
Restated Certificate of Incorporation. To Moore and FRDK's knowledge, the
Wallace Board has to date refused to take any such action.
SOLICITATION OF PROXIES
Proxies may be solicited by mail, advertisement, telephone or
telecopier or in person. Solicitations may be made by directors, officers and
employees of Moore or FRDK, none of whom will receive additional compensation
for such solicitations. Moore and FRDK have requested banks, brokerage houses
and other custodians, nominees and fiduciaries to forward all their
solicitation materials to the beneficial owners of the Shares they hold of
record. Moore and FRDK will reimburse these record holders for customary
clerical and mailing expenses incurred by them in forwarding these materials to
their customers.
FRDK has retained MacKenzie Partners, Inc. (the "Agent") for
solicitation and advisory services in connection with the solicitation, for
which the Agent is to receive a fee of $[__________], together with
reimbursement for its reasonable out-of-pocket expenses. Moore and FRDK have
also agreed to indemnify the Agent against certain liabilities and expenses,
including liabilities and expenses under the Federal securities laws. The
Agent will solicit proxies for the Annual Meeting from individuals, brokers,
21
<PAGE> 24
banks, bank nominees and other institutional holders. It is anticipated that
the Agent will employ approximately 50 persons to solicit stockholders for the
Annual Meeting.
Certain information about directors and officers of Moore, FRDK and
its advisors who may also assist in soliciting proxies, is set forth in the
attached Schedule I.
The entire expense of soliciting proxies for the Annual Meeting is
being borne by Moore and FRDK. Moore and FRDK may seek reimbursement for such
expenses from Wallace, but do not expect that the question of such
reimbursement will be submitted to a vote of stockholders. Costs incidental to
this solicitation of proxies include expenditures for printing, postage, legal,
accounting, public relations, advertising and related expenses and are expected
to be approximately $[________]; costs incurred to the date of this Proxy
Statement are approximately $[_____________].
If the Moore Nominees are elected, Moore and FRDK may seek to cause
the Moore Nominees to have Moore and FRDK reimbursed by Wallace for all
expenses paid or incurred, or for which Moore and FRDK or any of their
respective affiliates may otherwise be liable, in connection with this proxy
solicitation and the proposed acquisition of Wallace, including, without
limitation, the fees paid or to be paid to Lazard Freres or Dominion. See
"BACKGROUND OF PROPOSED ACQUISITION AND SOLICITATION."
If Moore or FRDK should withdraw, or materially change the terms of,
this solicitation of proxies prior to the Annual Meeting, Moore and FRDK will
supplement this Proxy Statement or otherwise publicly disseminate information
regarding such withdrawal or change.
OTHER INFORMATION
Certain information regarding Shares held by Wallace's directors,
nominees, management and other 5% stockholders is contained in the Wallace
Proxy Statement and is incorporated herein by reference.
Information concerning the date by which proposals of security holders
intended to be presented at the next annual meeting of stockholders of Wallace
must be received by Wallace for inclusion in Wallace' proxy statement and form
of proxy for that meeting is contained in the Wallace Proxy Statement and is
incorporated herein by reference.
Each of Moore and FRDK assumes no responsibility for the accuracy or
completeness of any information contained herein which is based on, or
incorporated by reference to Wallace public filings.
PLEASE INDICATE YOUR SUPPORT OF THE MOORE NOMINEES AND THE STOCKHOLDER
RESOLUTIONS BY COMPLETING, SIGNING AND DATING THE ENCLOSED GOLD ANNUAL MEETING
PROXY CARD AND RETURN IT PROMPTLY TO MACKENZIE PARTNERS, INC., 156 FIFTH
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<PAGE> 25
AVENUE, 9TH FLOOR, NEW YORK, NEW YORK 10010 IN THE ENCLOSED ENVELOPE. NO
POSTAGE IS NECESSARY IF THE ENVELOPE IS MAILED IN THE UNITED STATES.
MOORE CORPORATION LIMITED
FRDK, INC.
September 12, 1995
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<PAGE> 26
SCHEDULE I
INFORMATION CONCERNING DIRECTORS AND EXECUTIVE OFFICERS
OF MOORE, FRDK AND THEIR ADVISORS THAT MAY PARTICIPATE IN
THE SOLICITATION OF PROXIES
The name, business address, and present principal occupation or
employment of each of the directors and executive officers of Moore, FRDK and
its advisors that may participate in the solicitation of proxies are set forth
below. Unless otherwise indicated, the principal business address of each
director or executive officer of Moore and FRDK is, 1 First Canadian Place,
Suite 7200, Toronto, Ontario M5X 1G5, Canada.
DIRECTORS AND EXECUTIVE OFFICERS OF MOORE
Present Office or Other
Name Principal Occupation or Employment
---- ----------------------------------
Reto Braun............................... Chairman of the Board, President,
and Chief Executive Officer.
Stephen A. Holinski...................... Senior Vice President and Chief
Financial Officer.
Joseph M. Duane.......................... Vice President and General Counsel.
Shoba Khetrapal.......................... Vice President and Treasurer.
Hilda Mackow............................. Vice President Communications.
Janice McKenzie.......................... Senior Analyst, Corporate
Secretarial.
Joan M. Wilson........................... Vice President and Secretary.
DIRECTORS AND EXECUTIVE OFFICERS OF FRDK
Present Office or Other
Name Principal Occupation or Employment
---- ----------------------------------
Joseph M. Duane.......................... Director, Chairman and President.
Stephen A. Holinski...................... Director, Vice President and
Treasurer.
Joan M. Wilson........................... Director, Vice President and
Secretary.
<PAGE> 27
ADVISORS OF MOORE AND FRDK
Name and Principal Present Office or Other
Business Address Principal Occupation or Employment
------------------ ----------------------------------
Representatives Employed by Lazard
Freres(1)
Gerald Rosenfeld.......................... Managing Director.
Mark McMaster............................. Vice President.
Representatives Employed by Dominion(2)
John Budreski............................. Vice President, Equity Division.
---------------
(1) The principal business address of any employees of Lazard Freres & Co. LLC
listed above is: Lazard Freres & Company LLC, 30 Rockefeller Plaza, New
York, New York 10020.
(2) The principal U.S. business address of the employee of RBC Dominion
Securities listed above is: RBC Dominion Securities Corporation,
180 Maiden Lane, 20th Floor, New York, New York, 10038.
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<PAGE> 28
IMPORTANT
Your proxy is important. No matter how many Shares you own,
please give Moore and FRDK your proxy FOR the election of the Moore Nominees
and FOR approval of the Stockholders Resolutions by:
MARKING the enclosed GOLD Annual Meeting
proxy card,
SIGNING the enclosed GOLD Annual Meeting
proxy card,
DATING the enclosed GOLD Annual Meeting
proxy card and
MAILING the enclosed GOLD Annual Meeting proxy card TODAY in
the envelope provided (no postage is required if mailed in the
United States).
If you have already submitted a proxy to Wallace for the Annual
Meeting, you may change your vote to a vote FOR the election of the Moore
Nominees or FOR the Stockholder Resolutions by marking, signing, dating and
returning the enclosed GOLD proxy card for the Annual Meeting, which must be
dated after any proxy you may have submitted to Wallace. Only your latest
dated proxy for the Annual Meeting will count at such meeting.
If you have any questions or require any additional information
concerning this Proxy Statement or the proposal by Moore to acquire Wallace,
please contact MacKenzie Partners, Inc. at the address and telephone number set
forth below. IF ANY OF YOUR SHARES ARE HELD IN THE NAME OF A BROKERAGE FIRM,
BANK, BANK NOMINEE OR OTHER INSTITUTION, ONLY IT CAN VOTE SUCH SHARES AND ONLY
UPON RECEIPT OF YOUR SPECIFIC INSTRUCTIONS. ACCORDINGLY, PLEASE CONTACT THE
PERSON RESPONSIBLE FOR YOUR ACCOUNT AND INSTRUCT THAT PERSON TO EXECUTE THE
GOLD ANNUAL MEETING PROXY CARD.
MACKENZIE PARTNERS, INC.
156 Fifth Avenue
New York, New York 10010
Tel: (212) 929-5500 (call collect)
or
Call Toll-Free (800) 322-2885
<PAGE> 29
WALLACE COMPUTER SERVICES, INC.
ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED BY
MOORE CORPORATION LIMITED AND FRDK, INC.
The undersigned stockholder of Wallace Computer Services, Inc.
("Wallace") hereby appoints Joseph M. Duane, Stephen A. Holinski, and Joan M.
Wilson, and each of them, each with full power of substitution, to vote all
shares of Common Stock of Wallace that the undersigned is entitled to vote if
personally present at the 1995 Annual Meeting of Stockholders of Wallace
Computer Services, Inc. to be held on [__________, ___,] 1995 at [________]
a.m./p.m., and at any adjournment or postponement thereof. The undersigned
hereby revokes any previous proxies with respect to the matters covered by this
Proxy.
MOORE AND FRDK, INC. RECOMMEND A VOTE FOR PROPOSALS 1, 2, 3 AND 4.
(Please mark each proposal with an "X" in the appropriate box)
1. ELECTION OF DIRECTORS:
Election of Curtis A. Hessler, Albert W. Isenman III and Robert P. Rittereiser
(collectively, the "Moore Nominees").
/_/ FOR all Moore Nominees except /_/ WITHHOLD AUTHORITY
for as marked below all Moore Nominees
(INSTRUCTION: To withhold authority to vote for one or more nominees,
mark FOR above and print the name(s) of the person(s) with respect to whom you
wish to withhold authority in the space provided below.)
_____________________________________________________________________
2. To remove all members of the Board of Directors of Wallace other than
the Moore Nominees, if then directors
/_/ FOR /_/ AGAINST /_/ ABSTAIN
3. Amendment to bylaws of Wallace to fix the number of directors at five.
/_/ FOR /_/ AGAINST /_/ ABSTAIN
4. Amendment to bylaws of Wallace repealing each provision of the bylaws
or amendment thereto adopted without approval of the Wallace
stockholders subsequent to February 15, 1995 and prior to the approval
of Proposal 3.
2
<PAGE> 30
/_/ FOR /_/ AGAINST /_/ ABSTAIN
__________________________________________________________________
5. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE ENCLOSED
ENVELOPE PROVIDED.
This Proxy, when properly executed, will be voted in the manner marked
herein by the undersigned stockholder. IF NO MARKING IS MADE, THIS PROXY WILL
BE DEEMED TO BE A DIRECTION TO VOTE FOR PROPOSALS 1, 2, 3 AND 4.
3
<PAGE> 31
Please date and sign this proxy
exactly as your name appears hereon.
_____________________________________
(Signature)
_____________________________________
(Signature, if held jointly)
_____________________________________
(Title)
Dated:_______________________________
When shares are held by joint tenants, both should sign. When signing as
attorney-in-fact, executor, administrator, trustee, guardian, corporate officer
or partner, please give full title as such. If a corporation, please sign in
corporate name by President or other authorized officer. If a partnership,
please sign in partnership name by authorized person.
To vote in accordance with Moore and FRDK's recommendation, just sign
and date this proxy; no boxes need to be checked.
4
