<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
/X/ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
for the fiscal year ended December 31, 1997
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
for the transition period from _______ to _______
Commission file number 33-14927
CHESAPEAKE CORPORATION 401(k)
SAVINGS PLAN FOR SALARIED EMPLOYEES
CHESAPEAKE CORPORATION
1021 East Cary Street
P. O. Box 2350
Richmond, Virginia 23219
<PAGE>
<PAGE>
INDEX OF FINANCIAL STATEMENTS AND SCHEDULES AND EXHIBIT
<TABLE>
<caption
Pages
<S> <C>
Report of independent accountants 3
Financial statements:
Statements of net assets available for benefits
with fund information at December 31, 1997 and 1996 4-5
Statements of changes in net assets available for
benefits with fund information for the years
ended December 31, 1997 and 1996 6-7
Notes to financial statements 8-12
Supplemental schedules:
Item 27a - Schedule of Assets held for investment
purposes at December 31, 1997 13-14
Item 27d - Schedule of Reportable transactions for
the year ended December 31, 1997 15-19
Nonexempt transactions with parties-in-interest for the
year ended December 31, 1997 *
Loans or fixed income obligations in default for the
year ended December 31, 1997 *
Leases in default or classified as uncollectible
for the year ended December 31, 1997 *
*There were no such transactions or obligations
or leases in default.
Exhibit:
23 - Consent of Coopers & Lybrand L.L.P. 20
/TABLE
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the members of the Chesapeake Corporation 401(k) Savings Plan
for Salaried Employees Committee (the "Committee") have duly caused
this annual report to be signed by the undersigned thereunto duly
authorized.
CHESAPEAKE CORPORATION 401(k)
SAVINGS PLAN FOR SALARIED
EMPLOYEES
By: \s\ Thomas A. Smith
Thomas A. Smith, Vice
President -Human Resources and
Chairman of the Committee
June 10, 1998
<PAGE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Chesapeake Corporation 401(k) Savings
Plan for Salaried Employees Committee:
We have audited the accompanying statements of net assets available
for benefits of the Chesapeake Corporation 401(k) Savings Plan for
Salaried Employees (the "Plan") as of December 31, 1997 and 1996,
and the related statements of changes in net assets available for
benefits for the years then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is
to express an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards 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. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for
benefits of the Plan as of December 31, 1997 and 1996, and the
changes in net assets available for benefits for the years then
ended in conformity with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on
the basic financial statements taken as a whole. The supplemental
schedules as listed in the accompanying index on page 1 are
presented for the purpose of additional analysis and are not a
required part of the basic financial statements but are
supplementary information required by the Department of Labor's
Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974. The supplemental
schedules are the responsibility of the Plan's management. The
Fund Information in the statements of net assets available for
benefits and the statements of changes in net assets available for
benefits is presented for purposes of additional analysis rather
than to present the net assets available for benefits and changes
in net assets available for benefits of each fund. The
supplemental schedules and Fund Information have been subjected to
the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements
taken as a whole.
COOPERS & LYBRAND L.L.P.
Richmond, Virginia
June 10, 1998<PAGE>
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1997
<TABLE>
<CAPTION>
LaSalle
Chesapeake Partners Diversified Income
Common Trust Equity Plus
Stock Fund Fund Fund Fund
----------- -------- ------------ ---------
<S> <C> <C> <C> <C>
Assets:
Investments (Notes 1b and 11):
Equity investments (cost $30,659,296) $19,372,405 $18,222,596
Fixed income investments
(cost $6,414,297)
Chesapeake Corporation Common Stock
(cost 6,298,080) $8,581,169
Money Market investments(cost $5,279,374) 395,228 $4,884,146
Loans
Receivables:
Accrued income 56,800 1,843,203 38 25,225
Employer contributions 43,678 73,328 64,092 17,445
------------- ----------- ------------ --------------
Total Assets 9,076,875 21,288,936 18,286,726 4,926,816
Liability:
Accrued expenses 1,916,531 64,130 42,670
-------------- ------------- ---- -------- --------------
Net assets available for benefits $9,076,875 $19,372,405 $18,222,596 $4,884,146
======== ========= ========= =========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1997
<TABLE>
<CAPTION>
Twentieth
Century
Ultra Phoenix Dreyfus A
Investors High Yield Bond Plus Participant
Fund A Fund Fund Loans Total
--------- --------- ------------ ------------ -------
<S> <C> <C> <C> <C> <C>
Assets:
Investments (Notes 1b and 11):
Equity investments
(cost $30,659,296) $6,905,994 $44,500,995
Fixed income investments
(cost $6,414,297) $5,806,002 $1,123,586 6,929,588
Chesapeake Corporation Common Stock
(cost 6,298,080) 8,581,169
Money Market investments 5,279,374
(cost $5,279,374)
Loans $1,150,158 1,150,158
Receivables:
Accrued income 1,424,039 43,623 6,324 3,399,252
Employer contributions 51,995 32,710 7,701 290,949
---------- ----------- ------------ -------------- ---------------
Total Assets 8,382,028 5,882,335 1,137,611 1,150,158 70,131,485
Liability:
Accrued expenses 1,476,034 76,333 13,590 3,589,288
----------- ------------ ------------- --------------- ---------------
Net assets available for benefits $6,905,994 $5,806,002 $1,124,021 $1,150,158 $66,542,197
======== ======== ========= ======= =========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1996
<TABLE>
<CAPTION>
LaSalle
Chesapeake Partners Diversified Fidelity Income
Common Trust Equity High Income Plus
Stock Fund Fund Fund Fund Fund
----------- ---- --------- ----------- ------------ -------
<S> <C> <C> <C> <C> <C>
Assets:
Investments
(Notes 1b and 11):
Equity investments
(cost $29,824,295) $18,625,613 $16,708,546
Fixed income investments
(cost $7,102,968)
Chesapeake Corporation
common stock
(cost $7,569,822) $10,641,647
Money market investments
(cost $5,739,622) 513,683 $5,225,939
Loans
Accrued income receivable
Cash 1,596 $5,707
----------------- ----------- -------------- -------------- -----------------
Total assets 11,156,926 18,625,613 16,708,546 5,707 5,225,939
Liability:
Accrued expenses 24,283 23,586 27,363
---------------- ------------ -------------- ------------- -----------------
Net assets available for
benefits $11,156,926 $18,601,330 $16,684,960 $5,707 $5,198,576
========= ========== ========= ========= =========
</TABLE>
The accompanying notes are an integral part of the financial statements.<PAGE>
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1996
<TABLE>
<CAPTION>
Twentieth
Century
Ultra Phoenix Dreyfus A
Investors High Yield Bond Plus Particpant
Fund A Fund Fund Loans Total
------------- ----------- ------------ ------------ -------
<S> <C> <C> <C> <C> <C>
Assets:
Investments
(Notes 1b and 11):
Equity investments
(cost $29,824,295) $6,734,270 $42,068,429
Fixed income investments
(cost $7,102,968) $6,691,186 $894,207 7,585,393
Chesapeake Corporation
common stock
(cost $7,569,822) 10,641,647
Money market investments
(cost $5,739,622) 5,739,622
Loans $1,153,891 $1,153,891
Accrued income receivable 347 347
Cash 7,303
-------------- ----------- -------------- -------------- -------------
Total assets 6,734,270 6,691,186 894,554 1,153,891 67,196,632
Liability:
Accrued expenses 97 75,329
------------- ------------ ------------- ------------- ----------------
Net assets available for
benefits $ 6,734,173 $6,691,186 $894,554 $1,153,891 $67,121,303
========= ========= ========= ========= ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.<PAGE>
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
for the year ended December 31, 1997
<TABLE>
<CAPTION>
LaSalle
Chesapeake Partners Diversified Fidelity Income
Common Trust Equity High Income Plus
Stock Fund Fund Fund Fund Fund
------------- ---------- ------------ ------------ -------
<S> <C> <C> <C> <C> <C>
Additions:
Interest and dividends $ 280,078 $ 79,706 $ 275,388
Contributions (Notes 3 and 4):
Employee 642,732 1,082,570 $ 931,374 270,759
Employer 233,694 369,911 326,936 95,677
Rollovers 256,710 122,610 143,386 47,952
Net appreciation in the fair
value of investments
(Note 1b) 446,655 4,658,111 5,105,144
------------ ------------- --------- ------------ ------------
1,859,869 6,312,908 6,506,840 689,776
------------- ------------- ---------- ------------ -----------
Deductions:
Distributions to participating
employ ees 213,037 948,214 875,914 229,152
Administrative fees 109,073 11,079
------------- --------- -------- ------------- ------------
213,037 948,214 984,987 240,231
------------ --------- --------- -------------- -----------
Net increase (decrease) 1,646,832 5,364,694 5,521,853 449,545
Interfund transfers, net (666,714) 691,496 263,012 $(5,707) 377,896
Interplan transfers, net 710,481 132 (1,308) (4,759)
Net transfer of plan assets
to St. Laurent Paperboard,
Inc. (Note 13) (3,770,650) (5,285,247) (4,245,921) (1,137,112)
Net assets available for benefits,
beginning of year 11,156,926 18,601,330 16,684,960 5,707 5,198,576
-------------- ---------- ----------- ------------ -----------
Net assets available for
benefits, end of year $ 9,076,875 $19,372,405 $18,222,596 $ 0 $4,884,146
========= ========= ========= ======== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
for the year ended December 31, 1997
<TABLE>
<CAPTION>
Twentieth
Century
Ultra Phoenix Dreyfus A
Investors High Yield Bond Plus Particpant
Fund A Fund Fund Loans Total
---------- --------- ------------ ------------ -------
<S> <C> <C> <C> <C> <C>
Additions:
Interest and dividends $ 2,622 $ 545,888 $ 56,875 $102,530 $ 1,343,087
Contributions (Notes 3 and 4):
Employee 741,090 446,341 113,708 4,228,574
Employer 243,658 164,524 37,936 1,472,336
Rollover 256,542 99,163 80,444 11,036 1,017,843
Net appreciation in the fair
value of investments
(Note 1b) 1,153,130 245,650 24,896 11,633,586
----------- ----- -------- ----------- --------------
2,397,042 1,501,566 313,859 113,566 19,695,426
----------- --------- --------- ------------ -----------
Deductions:
Distributions to participating
employees 394,926 301,862 12,621 383,983 3,359,709
Administrative fees 120,152
----------- ----------- ---------- ----------- ------------
394,926 301,862 12,621 383,983 3,479,861
------------- ----------- ----------- ----------- ----------
Net increase (decrease) 2,002,116 1,199,704 301,238 (270,417) 16,215,565
Interfund transfers, net (328,753) (677,483) 79,569 266,684
Interplan transfers, net 7,987 1,003 2,604 716,140
Net transfer of plan assets to
St. Laurent Paperboard,
Inc. (Note 13) (1,509,529) (1,408,408) (153,944) (17,510,811)
Net assets available for benefits,
beginning of year 6,734,173 6,691,186 894,554 1,153,891 67,121,303
------------- ----------- --------- ------------ ------------
Net assets available for
benefits, end of year $6,905,994 $5,806,002 $1,124,021 $1,150,158 $66,542,197
======== ======== ======== ========== =========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
for the year ended December 31, 1996
<TABLE>
<CAPTION>
LaSalle
Chesapeake Partners Diversified Fidelity Income
Common Trust Equity High Income Plus
Stock Fund Fund Fund Fund Fund
------------- ---- --------- ------------ ------------ -------
<S> <C> <C> <C> <C> <C>
Additions:
Interest and dividends $ 301,195 $ 94,248 $ 326,551
Contributions (Notes 3 and 4):
Employee 1,144,509 1,461,268 $1,262,213 601,978
Employer 302,812 400,383 395,905 113,204
Net appreciation (depreciation)
in the fair value of investments
(Note 1b) 737,030 3,489,412 2,800,802 $
----------- ----------- ----------- ----------- -------------
2,485,546 5,445,311 4,458,920 0 1,041,733
------------- ---------- ------------ ----------- --------------
Deductions:
Distributions to participating
employees 333,003 759,599 663,481 270,120
Administrative fees 70,897 11,056
----------- ----------- ------------ ----------- -------------
333,003 759,599 734,378 281,176
------------- ----------- ------------ ------------ ----------
Net increase 2,152,543 4,685,712 3,724,542 0 760,557
Interfund transfers, net (774,166) 657,149 (470,565) (569,223)
Interplan transfers, net (32,954) 47,015 (23,090) (21,723)
Net assets available for benefits,
beginning of year 9,811,503 13,211,454 13,454,073 5,707 5,028,965
----------- ------------ ------------ ------------- ---------
Net assets available for benefits,
end of year $11,156,926 $18,601,330 $16,684,960 $5,707 $5,198,576
========== ========= ========= ========= ========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
for the year ended December 31, 1996
<TABLE>
<CAPTION>
Twentieth
Century
Ultra Phoenix Dreyfus A
Investors High Yield Bond Plus Particpant
Fund A Fund Fund Loans Total
--------- --------- ------------ ------------ -------
<S> <C> <C> <C> <C> <C>
Additions:
Interest and dividends $ 489,815 $ 54,498 $ 94,742 $ 1,361,049
Contributions (Notes 3 and 4):
Employee $ 975,976 737,388 176,369 6,359,701
Employer 249,146 204,836 37,787 1,704,073
Net appreciation (depreciation)
in the fair value of investments
(Note 1b) 654,778 445,840 (33,958) 8,093,904
------------ ----------- -------- ------ ---------------
1,879,900 1,877,879 234,696 94,742 17,518,727
------------- ---------- -------- ------ ---------------
Deductions:
Distributions to participating
employees 223,481 324,915 162,272 2,736,871
Administrative fees 81,953
------------- ------------ ------------ ------------- ----------
223,481 324,915 162,272 2,818,824
------------ ------------ ------------ ---------- -----------
Net increase 1,656,419 1,552,964 72,424 94,742 14,699,903
Interfund transfers, net 1,409,569 (353,618) (71,322) 172,176
Interplan transfers, net 43,469 (20,054) (13,565) (20,902)
Net assets available for benefits,
beginning of year 3,624,716 5,511,894 907,017 886,973 52,442,302
----------- ------------ ----------- -------- --------------
Net assets available for benefits,
end of year $6,734,173 $6,691,186 $894,554 $1,153,891 $67,121,303
======== ======== ======= ======== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
CHESAPEAKE CORPORATION 401(k) SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies:
a. GENERAL:
The Chesapeake Corporation 401(k) Savings Plan for Salaried Employees (the
"Plan") covers certain employees of Chesapeake Corporation ("Chesapeake" or
the "Employer") as described in the Plan agreement. The Plan's assets are
held by the Bank of New York (the "Trustee").
b. INVESTMENT VALUATION AND INCOME:
Investments are stated at fair value determined as follows:
Mutual and Money Market funds - Quoted market value
Common stock-Last published sale price on the New York Stock Exchange
Loans to participants - Balances due which approximates fair value
Purchases and sales of securities are recorded on a trade-date basis.
Investment income is recorded as earned. Dividend income is recorded on the
ex-dividend date. The Plan presents in the statement of changes in net
assets available for benefits the "net appreciation (depreciation)
in the fair value of investments," which consists of the realized gains and
losses and the change in unrealized appreciation (depreciation) on those
investments.
c. RISKS AND UNCERTAINTIES:
The Plan provides for various mutual fund investment
options in stocks, bonds and fixed income securities as
well as direct common stock investments. Investments are
exposed to various risks, such as interest rate, market and
credit. Due to the level of risk associated with certain
investment securities and the level of uncertainty related
to changes in the value of investment securities, it is at
least reasonably possible that changes in risks in the near
term would materially affect participants' account balances
and the amounts reported in the statements of assets
available for benefits and the statement of changes in
assets available for benefits.
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 reported amounts of
income and expenses during the reporting period. Actual
results could differ from those estimates.
<PAGE>
NOTES TO FINANCIAL STATEMENTS, Continued
2. DESCRIPTION OF PLAN:
The Plan is a defined contribution plan. Information
regarding Plan benefits, priority of distributions upon
termination of the Plan, allocation of Plan investment
earnings, and vesting is provided in the Plan agreement which
is available at the main office of the Plan administrator at
2104 West Laburnum Avenue, Richmond, Virginia 23227.
3. EMPLOYEE CONTRIBUTIONS:
A participant may elect to defer receipt of 1% to 10% of
annual before-tax compensation, in increments of 1%.
Elective deferral contributions may not exceed $10,000 per
participant in any taxable year.
4. EMPLOYER CONTRIBUTIONS:
The Plan provides for a matching contribution each plan year
in an amount equal to 50% of the first 5% of each
participant's compensation that the participant elects to
contribute to the Plan as an elective deferral contribution
for the Plan year. Matching contributions for highly
compensated participants are limited by the Internal Revenue
Code as described in the Plan document. Chesapeake may make
contributions on behalf of specified participants, regardless
of whether the participants make elective deferral
contributions, as nonelective contributions.
5. PARTICIPANT LOANS:
Participants may borrow from their fund accounts a minimum of
$1,000 up to a maximum equal to the lesser of $50,000 or 50
percent of their account balance. Loan transactions are
treated as a transfer to (from) the investment fund from (to)
the Participant Loan fund. Loan terms range from 1-5 years
or up to 10 years for the purchase of a primary residence.
The loans are collateralized by the balance in the
participant's account and bear interest at a rate
commensurate with the prime rate plus one percent as
determined monthly by the Plan administrator. Interest rates
range from 9.25% to 9.5%. Principal and interest is paid
ratably through monthly payroll deductions.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS, Continued
6. BENEFIT PAYMENTS:
Benefits under the Plan become distributable upon termination
of employment, upon early retirement, on or after normal
retirement, or upon death or disability. Benefit payments
are made to the participant as a lump-sum distribution or an
annuity.
7. FORFEITURES:
Forfeitures resulting from separation from service are held
in the Plan and serve to reduce Employer contributions under
certain conditions described in the Plan document.
8. PLAN EXPENSES:
Expenses incurred in connection with the purchase or transfer
of Chesapeake common stock are borne by a participant's
account. Fees, if any, of investment managers are borne by
participants who select such investments. All other expenses
associated with the administration of the Plan are paid by
Chesapeake.
9. PLAN TERMINATION:
While Chesapeake has not expressed any intent to discontinue
its contributions, continuance is not assumed as a
contractual obligation and any such discontinuance is subject
to the provisions of the Employee Retirement Income Security
Act of 1974 ("ERISA"). In the event such discontinuance
results in the termination of the Plan, the Plan provides
that each participant shall be fully vested in his account
and payment of such amounts will be made by the Trustee as
directed by the Chesapeake Corporation 401(k) Savings Plan
for Salaried Employees Committee.
10. INVESTMENT OPTIONS:
Participants may elect to have amounts credited to their
accounts in the Plan invested in 1% increments in Chesapeake
Common Stock, the Partners Trust Fund, Diversified Equity
Fund, LaSalle Income Plus Fund, Twentieth Century Ultra
Investors Fund, Phoenix High Yield A Fund or the Dreyfus A
Bond Plus Fund. The following is the number of participants
in each of the investment options as of December 31:
<PAGE>
NOTES TO FINANCIAL STATEMENTS, Continued
10. INVESTMENT OPTIONS, CONTINUED:
<TABLE>
<CAPTION>
1997 1996
<S> <C> <C>
Chesapeake Common Stock Fund 638 806
Partners Trust Fund 971 1,129
Diversified Equity Fund 879 1,036
LaSalle Income Plus Fund 391 525
Twentieth Century Ultra
Investors Fund 639 671
Phoenix High Yield A Fund 558 679
Dreyfus A Bond Plus Fund 216 220
</TABLE>
A description of the investment options currently available to
participants is as follows:
CHESAPEAKE COMMON STOCK FUND: This investment option consists of
shares of the common stock of Chesapeake Corporation that are
purchased by the Plan's trustee at fair market value in the open
market, in private transactions, or directly from Chesapeake
Corporation.
PARTNERS TRUST FUND: This fund, managed by Neuberger & Berman,
invests primarily in common stock and, to a lesser extent,
short-term money market instruments and other debt securities.
DIVERSIFIED EQUITY FUND: This fund, managed by Associated Bank,
invests primarily in common stock of domestic and foreign publicly
held corporations.
LASALLE INCOME PLUS FUND: This fund, managed by LaSalle National
Bank, invests in instruments designed to preserve capital, maximize
income and provide liquidity without sacrificing credit quality.
Investments include U.S. Government Securities, bank investment
contracts and guaranteed investment contracts issued by insurance
companies.
TWENTIETH CENTURY ULTRA INVESTORS FUND: This fund invests primarily in
common
stock that are considered to have better than average prospects for
appreciation.
PHOENIX HIGH YIELD A FUND: This fund, managed by Phoenix Investments, intends
to invest at least 65% of the value of high yield, high risk fixed income
securities.
DREYFUS A BOND PLUS FUND: This fund, managed by Dreyfus Corporation, invests
primarily in higher-quality corporate and government bonds to see income with
preservation of capital.
<PAGE>
NOTES TO FINANCIAL STATEMENTS, Continued
11. INVESTMENTS:
The investments are held in trust funds which are administered
by the Trustee.
The investments in Chesapeake common stock may be purchased by
The Bank of New York at fair market value in the open market,
in private transactions, or from the authorized but unissued
shares of Chesapeake.
Investments at December 31, 1997 and 1996 held by the Bank of New York
consist of:
<TABLE>
<CAPTION>
1997 1996
-----------------------------------------------------------------------------
Number Fair Number Fair
of Shares Cost Value of Shares Cost Value
<S> <C> <C> <C> <C> <C> <C>
Investments at Fair
Value as determined
by quoted market price:
Equity funds:
Partners Trust Fund 1,109,531 $14,358,260 $19,372,405 1,242,536 $14,071,447 $18,625,613
Twentieth Century Ultra
Investors Fund 252,967 7,253,476 6,905,994 239,739 6,279,888 6,73,4270
Fixed income funds:
Dreyfus A Bond
Plus Fund 76,539 1,096,410 1,123,586 62,055 876,487 894,207
Phoenix High Yield
A Fund 633,152 5,317,887 5,806,002 784,061 6,226,481 6,691,186
Common stock:
Chesapeake
Corporation 249,634 6,298,080 8,581,169 339,176 7,569,822 10,641,647
Money market funds:
LaSalle Income
Plus Fund 4,884,146 4,884,146 4,884,146 5,225,939 5,225,939 5,225,939
Short-term
investments 395,228 395,228 395,228 513,683 513,683 513,683
------------- ---------- ---------- ----------
39,603,487 47,068,530 40,763,747 49,326,545
Investments at estimated
fair value:
Diversified
Equity Fund 879,087 9,047,560 18,222,596 1,082,370 9,472,960 16,708,546
--------------- ---------- --------- ----------
$48,651,047 $65,291,126 $50,236,707 $66,035,091
=========== ======== ========= =========
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS, Continued
12. TAX STATUS:
The Plan obtained its latest determination letter on March 30,
1995, in which the Internal Revenue Service stated that the
Plan, as designed, was in compliance with the applicable
requirements of the Internal Revenue Code. The Plan has been
amended since receiving the determination letter. However,
management and the plan administrator believe that the Plan is
currently designed and being operated in accordance with all
applicable rules and regulations.
13. SALE OF KRAFT AND PACKAGING OPERATIONS:
On May 23, 1997, Chesapeake sold certain kraft and packaging
operations to St. Laurent Paperboard Inc. ("St. Laurent"). In
connection with this transaction, all participants who were
employed by the operations which were sold had their accounts
transferred out of the Chesapeake Corporation 401(k) Savings
Plan for Salaried Employees and into a plan sponsored by St.
Laurent. The net value of the accounts transferred from the
Plan to St. Laurent was $17,510,811.
<PAGE>
ITEM 27A - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1997
EIN: 54-0166880 PN: 042
SCHEDULE OF SECURITIES HELD FOR INVESTMENT - PART I
PERIOD ENDING 12/31/97 THE BANK OF
NEW YORK
CHESAPEAKE CORP - SALARY
<TABLE>
<CAPTION>
SECURITY DESCRIPTION SHARES/UNITS/PAR VALUE COST MARKET VALUE
- ---------------------- ----------------------- ------- ------------
<S> <C> <C> <C>
COMMON STOCKS
CHESAPEAKE CORP 249,634.00 6,298,080.39 8,581,168.75
TOTAL COMMON SHARES 249,634.00 6,298,080.39 8,581,168.75
OTHER ASSETS
AMERICAN CENTY
ULTRA FD INV 252,966.82 7,253,475.68 6,905,994.38
ASSOCIATED BANK
DIV EQ FD 879,087.07 9,047,560.02 18,222,595.87
CHESAPEAKE CORP 1,150,157.77 1,150,157.7 1,150,157.77
DREYFUS A BDS PLUS INC 76,538.55 1,096,409.5 1,123,586.02
COM
LASALLE INTEREST
INCOME FUND 4,884,146.42 4,884,146.42 4,884,146.42
NEUBERGER BERMAN
PARTNERS TRUST 1,109,530.61 14,358,260.17 19,372,404.50
VALUE AS REPORTED
BY NEUBERGER
PHOENIX HIGH YIELD
FUND (A) 633,151.83 5,317,887.25 5,806,002.30
TOTAL OTHER ASSETS 8,985,579.07 43,107,897.06 57,464,887.26
SHORT TERM INVESTMENTS
COLLECTIVE SHORT TERM
INVEST 395,228.03 395,228.03 395,228.03
FD NON-DISCRETIONARY
TOTAL SHORT TERM 395,228.03 395,228.03 395,228.03
INVESTMENTS
TOTAL INVESTMENTS 9,630,441.10 49,801,205.48 66,441,284.04
</TABLE>
<PAGE>
ITEM 27A - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1997
EIN: 54-0166880 PN: 042
SCHEDULE OF SECURITIES HELD FOR INVESTMENT - PART II
ACQUIRED AND DISPOSED OF WITHIN THE PLAN YEAR
DURING THE PERIOD 01/01/97 TO 12/31/97
THE BANK OF NEW YORK
CHESAPEAKE CORP - SALARY
<TABLE>
<CAPTION>
SECURITY DESCRIPTION SHARES/UNITS/PAR VALUE COST PROCEED
- -------------------------- ----------------------- ----------- -----------
<S> <C> <C> <C> <C>
CHESAPEAKE CORP ACQ: 791,280.61 791,280.61
DIS: 422,066.69 422,066.69
TOTAL ACQUISITIONS: 791,280.61 791,280.61
DISPOSITIONS: 422,066.69 422,066.69
/TABLE
<PAGE>
<PAGE>
Item 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
for the year ended December 31, 1997
SINGLE REPORTABLE SECURITY TRANSACTIONS
EXCEEDING 5% OF FUND ASSETS
DURING THE PERIOD 01/01/97 TO 12/31/97 THE BANK OF NEW YORK
CHESAPEAKE CORP - SALARY
5% OF 12/31/96 MARKET VALUE OF 67,179,741.99 = 3,358,987.09
<TABLE>
<CAPTION>
REVALUED PROCEEDS
TRANS COST OF PURCHASE NET
ISSUE TYPE PRICE EXPENSES DISPOSAL VALUE GAIN/LOSS
OTHER ASSETS
<S> <C> <C> <C> <C> <C> <C>
ASSOCIATED BANK
DIV EQ FD S .000 .00 3,648,504.37 4,092,222.63 443,718.26
NEUBERGER BERMAN
PARTNERS TRUST S .000 .00 5,124,534.10 5,133,289.96 8,755.86
</TABLE>
<PAGE>
<PAGE>
Item 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
for the year ended December 31, 1997
SINGLE REPORTABLE SECURITY TRANSACTIONS
EXCEEDING 5% OF FUND ASSETS
DURING THE PERIOD 01/01/97 TO 12/31/97 THE BANK OF NEW YORK
CHESAPEAKE CORP - SALARY
5% OF 12/31/96 MARKET VALUE OF 67,179,741.99 = 3,358,987.09
<TABLE>
<CAPTION>
NO. OF NO. OF TOTAL VALUE TOTAL VALUE NET
ISSUE PURCHASES SALES PURCHASES SALES GAIN/LOSS
<S> <C> <C> <C> <C> <C>
COMMON STOCKS
CHESAPEAKE CORP 32 35 4,009,153.14 4,093,790.05 292,883.50
OTHER ASSETS
LASALLE INTEREST
INCOME FUND 89 95 3,229,494.58 3,566,728.26 .00
ASSOCIATED BANK
DIV EQ FD 121 105 3,327,596.22 6,918,690.35 827,500.66
PHOENIX HIGH YIELD
FUND (A) 97 85 1,605,260.82 2,736,094.95 61,756.83
AMERICAN CENTURY
ULTRA FUND 122 83 4,793,278.73 4,380,305.49 329,250.69
NEUBERGER BERMAN PARTNERS
TRUST 133 82 5,868,079.29 8,015,900.46 181,827.76
SHORT TERM INVESTMENTS
COLLECTIVE SHORT TERM
INVEST FD 115 114 9,130,892.28 9,249,347.35 .00
</TABLE>
<PAGE>
Item 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
for the year ended December 31, 1997
INVOLVED IN A SINGLE REPORTABLE TRANSACTIONS
DURING THE PERIOD 01/01/97 TO 12/31/97 THE BANK OF NEW YORK
CHESAPEAKE CORP - SALARY
5% OF 12/31/96 MARKET VALUE OF 67,179,741.99 = 3,358,987.09
<TABLE>
<CAPTION>
REVALUED PROCEEDS OR
TRANS BROKER COST OF PURCHASE NET
ISSUE TYPE PRICE COMMISSION DISPOSAL VALUE GAIN/LOSS
<S> <C> <C> <C> <C> <C> <C>
NONE
</TABLE>
Exhibit 23
CONSENT OF COOPERS & LYBRAND L.L.P.
We consent to the incorporation by reference in the registration statement on
Form S-8 of Chesapeake Corporation for the Chesapeake Corporation 401(k) Savings
Plan for Salaried Employees (File No. 33-14927) of our report dated June 10,
1998, on our audits of the financial statements of the Chesapeake Corporation
401(k) Savings Plan for Salaried Employees as of December 31, 1997 and 1996, and
for the years then ended, which report is included in this Annual Report on Form
11-K.
COOPERS & LYBRAND L.L.P.
Richmond, Virginia
June 26, 1998
