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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-1
(AMENDMENT NO. 4)
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND
SCHEDULE 13D
(AMENDMENT NO. 4)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
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SHOREWOOD PACKAGING CORPORATION
(Name of Subject Company)
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CHESAPEAKE CORPORATION
SHEFFIELD, INC.
(Bidders)
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Common Stock, $0.01 Par Value Per Share
(Including Associated Rights)
(Title of Class of Securities)
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825229107
(CUSIP Number of Class of Securities)
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Thomas H. Johnson
President & Chief Executive Officer
Chesapeake Corporation
1021 East Cary Street
Richmond, Virginia 23218-2350
(804) 697-1000
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
Copies to:
Gary E. Thompson, Esq.
Hunton & Williams
Riverfront Plaza, East Tower
951 East Byrd Street
Richmond, Virginia 23219-4074
(804) 788-8200
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December 21, 1999
(Date of Event Which Requires Filing of This Statement)
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This Amendment No. 4 to Schedule 14D-1 supplements and amends the Tender
Offer Statement on Schedule 14D-1, filed on December 3, 1999 (the "Schedule
14D-1"), by Sheffield, Inc., a Delaware corporation ("Purchaser"), and
Chesapeake Corporation ("Chesapeake"), a Virginia corporation and the direct
owner of all of the outstanding capital stock of Purchaser. The Schedule 14D-1
relates to the offer by Purchaser to purchase all outstanding shares of common
stock, $0.01 par value per share (the "Common Stock"), including the
associated rights to purchase preferred stock (the "Rights" and together with
the Common Stock, the "Shares"), of Shorewood Packaging Corporation, a
Delaware corporation (the "Company"), not directly or indirectly owned by
Chesapeake and its subsidiaries, for a purchase price of $17.25 per Share, net
to the seller in cash, without interest thereon, on the terms and subject to
the conditions set forth in the Offer to Purchase, dated December 3, 1999 (the
"Offer to Purchase"), and in the related Letter of Transmittal and any
amendments or supplements thereto (which collectively constitute the "Offer").
Capitalized terms used and not otherwise defined herein have the meanings set
forth in the Schedule 14D-1. This Amendment No. 4 to Schedule 14D-1 also
constitutes Amendment No. 4 to the statement on Schedule 13D of Purchaser and
Chesapeake, filed on November 30, 1999.
Item 3. Past Contacts, Transactions or Negotiations with the Subject Company
(b) The text of Section 10 of the Offer to Purchase is hereby amended and
supplemented by adding thereto the following:
On December 21, 1999, the Company issued the following press release which
contained the full text of a letter which Mr. Shore delivered on that date to
Mr. Johnson:
FOR IMMEDIATE RELEASE:
CONTACTS:
Sard Verbinnen & Co.
David Reno/Paul Caminiti
(212) 687-8080
SHOREWOOD SENDS LETTER TO CHESAPEAKE
NEW YORK, DECEMBER 21, 1999--Shorewood Packaging Corporation (NYSE:SWD) today
sent the following letter to Tom Johnson, President and Chief Executive
Officer of Chesapeake Corporation (NYSE: CSK):
December 21, 1999
Mr. Thomas H. Johnson
President and Chief Executive Officer
Chesapeake Corporation
1021 E. Cary Street
Richmond, Virginia 21218
Dear Tom:
I have read your letter dated December 17, 1999.
You are correct that our Board of Directors has authorized management and our
financial advisors to explore alternatives available to Shorewood to enhance
stockholder value. I understand that despite your commencement of a highly
conditional, inadequate tender offer, you now seek to have discussions with us
regarding your offer. We decline your request for a meeting for the following
reasons:
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The current Chesapeake offer has been found by Shorewood's Board of Directors
to be inadequate; among other factors, it represents a 15% to 20% discount to
analysts' short-term trading targets for Shorewood shares.
We believe that Section 203 of the Delaware corporate law effectively prevents
Chesapeake from completing a merger with Shorewood for at least three years.
We are concerned that the inadequate offer you have made is also highly
conditional. For example, Chesapeake's proposed bank financing does not appear
to contemplate the situation where Chesapeake could be a majority stockholder
with fiduciary duties to the minority, which would preclude it from utilizing
Shorewood's cash for its own use and otherwise consolidating operations.
Although Chesapeake has stated that it is a "willing" buyer, we question
whether it is financially "ready" or "able."
As fiduciaries, we consider the best interests of all stockholders. In this
regard we seek value and certainty on behalf of the entire stockholder base
and are reluctant to support any transaction which is fraught with serious
contingencies.
Due to concerns regarding the inadequacy of your offer, your conditional
financing and completion risks, we do not believe it is in the best interests
of our stockholders to pursue your inadequate proposal.
Sincerely,
/s/ Marc P. Shore
Marc P. Shore
Shorewood Packaging Corporation is a leading value-added provider of high
quality printing and paperboard packaging for the music, computer software,
cosmetics and toiletries, food, home video, tobacco and general consumer
markets in North America and China, with 16 plants in the United States,
Canada and China.
# # #
Certain statements included in this press release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements are typically identified by their inclusion of
phrases such as "Shorewood anticipates," "Shorewood believes"' and other
phrases of similar meaning. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause the actual
results, performance or achievements of Shorewood to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include, among others: general
economic and business conditions; competition; political changes in
international markets; raw material and other operating costs; costs of
capital equipment; changes in foreign currency exchange rates; changes in
business strategy or expansion plans; the results of continuing environmental
compliance testing and monitoring; quality of management; availability, terms
and development of capital; fluctuating interest rates and other factors
referenced in this release and in Shorewood's Annual Report on Form 10-K and
quarterly reports on Form 10-Q.
THIS PRESS RELEASE DOES NOT CONSTITUTE A SOLICITATION TO REVOKE CONSENTS IN
CONNECTION WITH THE CONSENT SOLICITATION OF CHESAPEAKE CORPORATION. ANY SUCH
SOLICITATION WILL BE MADE ONLY BY MEANS OF SEPARATE CONSENT SOLICITATION
MATERIALS COMPLYING THE REQUIREMENTS OF SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, AND THE RULES AND REGULATIONS PROMULGATED
THEREUNDER.
CERTAIN INFORMATION CONCERNING PARTICIPANTS
Shorewood Packaging Corporation ("Shorewood") and certain other persons named
below may be deemed to be participants in the solicitation of revocations of
consents in response to the consent solicitation being conducted by Chesapeake
Corporation ("Chesapeake"). The participants in this solicitation may include:
(i) the
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directors of Shorewood (Marc P. Shore (Chairman of the Board and Chief
Executive Officer), Howard M. Liebman (President and Chief Financial Officer),
Leonard Verebay (Executive Vice President), Andrew N. Shore (Vice President
and General Counsel), Kevin J. Bannon, Sharon R. Fairley, Virginia A. Kamsky,
R. Timothy O'Donnell and William P. Weidner; and (ii) William H. Hogan (Senior
Vice President, Finance and Corporate Controller). As of the date of this
communication, the number of shares of common stock, par value $0.01 per share
("Common Stock"), beneficially owned by the Shorewood participants (including
shares subject to stock options exercisable within 60 days) is as follows:
Marc P. Shore (4,750,485), Howard M. Liebman (233,269), Leonard J. Verebay
(500,180), Andrew N. Shore (169,052), Kevin J. Bannon (33,000), Virginia A.
Kamsky (4,500), R. Timothy O'Donnell (326,118); William P. Weidner (57,000);
and William H. Hogan (30,500).
Shorewood has retained Bear, Stearns & Co. Inc. ("Bear Stearns") and Jefferson
Capital Group, Ltd. ("Jefferson Capital") to act as its co-financial advisors
in connection with the tender offer (the "Offer") by Chesapeake and its wholly
owned subsidiary, Sheffield, Inc., to purchase shares of Common Stock for
$17.25 per share net to the seller in cash, for which Bear Stearns and
Jefferson Capital may receive substantial fees, as well as reimbursement of
reasonable out-of-pocket expenses. In addition, Shorewood has agreed to
indemnify Bear Stearns, Jefferson Capital and certain related persons against
certain liabilities, including certain liabilities under the federal
securities laws, arising out of their engagement. Neither Bear Stearns nor
Jefferson Capital admit that they or any of their partners, directors,
officers, employees, affiliates or controlling persons, if any, is a
"participant" as defined in Schedule 14A promulgated under the Securities
Exchange Act of 1934, as amended, in the solicitation of consent revocations,
or that Schedule 14A requires the disclosure of certain information concerning
Bear Stearns and Jefferson Capital, respectively.
In connection with Bear Stearns' role as co-financial advisor to Shorewood,
Bear Stearns and the following investment banking employees of Bear Stearns
may communicate in person, by telephone or otherwise with a limited number of
institutions, brokers or other persons who are stockholders of Shorewood and
may solicit consent revocations therefrom: Terence Cryan (Senior Managing
Director), Charles Edelman (Senior Managing Director), Mark A. Van Lith
(Managing Director) and Karen Duffy (Vice President). Bear Stearns engages in
a full range of investment banking, securities trading, market-making and
brokerage services for institutional and individual clients. In the normal
course of its business Bear Stearns may trade securities of Shorewood for its
own account and the accounts of its customers, and accordingly, may at any
time hold a long or short position in such securities. Bear Stearns has
informed Shorewood that, as of the date hereof, Bear Stearns held no shares of
Common Stock for its own account. Bear Stearns and certain of its affiliates
may have voting and dispositive power with respect to certain shares of Common
Stock held in asset management, brokerage and other accounts. Bear Stearns and
such affiliates disclaim beneficial ownership of such shares of Common Stock.
In connection with Jefferson Capital's role as co-financial advisor to
Shorewood, Jefferson Capital and the following investment banking employees of
Jefferson Capital may communicate in person, by telephone or otherwise with a
limited number of institutions, brokers or other persons who are stockholders
of Shorewood and may solicit consent revocations therefrom: R. Timothy
O'Donnell (President) and Louis W. Moelchert (Vice President). R. Timothy
O'Donnell is the beneficial owner of 276,118 shares of Common Stock. Louis W.
Moelchert is the beneficial owner of 1,500 shares of Common Stock. Jefferson
Capital has informed Shorewood that, as of the date hereof, it held 22,231
shares of Common Stock in its investment account.
Also on December 21, 1999, Chesapeake issued the following press release:
FOR IMMEDIATE RELEASE
CHESAPEAKE RESPONDS TO SHOREWOOD LETTER
(Richmond, VA--December 21, 1999) Chesapeake Corporation (NYSE:CSK) issued the
following statement today in response to a letter sent to Thomas H. Johnson,
president and chief executive officer of Chesapeake, from Shorewood Packaging
Corporation (NYSE:SWD).
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Mr. Johnson said, "We are mystified by Shorewood's refusal to include
Chesapeake in Shorewood's announced process to explore alternatives to enhance
stockholder value. We stand ready to meet to discuss price and structure of
our fully financed offer. Shorewood's purported grounds for excluding
Chesapeake from its process are unfounded and utterly without merit. Their
intransigence is especially unfortunate, in that Shorewood's board has
attempted to adopt by-law amendments which purport to restrict Shorewood's
stockholders' ability to consider our offer. We are challenging Shorewood's
actions in court."
Chesapeake Corporation, headquartered in Richmond, Va., is a global leader in
specialty packaging and merchandising services. Chesapeake is the largest
North American producer of temporary and permanent point-of-purchase displays,
the North American leader for litho-laminated packaging, the leading European
folding carton, leaflet and label supplier, and a local leader in specific
U.S. markets for customized, corrugated packaging. Chesapeake has over 40
locations in North America, Europe and Asia. Chesapeake's net sales in 1998
were $950.4 million. Chesapeake's website is www.cskcorp.com.
# # #
This news release does not constitute an offer to purchase any securities, nor
a solicitation of proxies or consents, from the stockholders of Shorewood
Packaging Corporation. The tender offer, and any solicitation of written
consents, will be made only pursuant to separate materials in compliance with
the requirements of applicable federal and state law.
This news release, including comments by Thomas H. Johnson, contains forward-
looking statements that are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. The accuracy of such
statements is subject to a number of risks, uncertainties, and assumptions
that may cause Chesapeake's actual results to differ materially from those
expressed in the forward-looking statements including, but not limited to:
competitive products and pricing; production costs, particularly for raw
materials such as corrugated box, folding carton and display materials;
fluctuations in demand; government policies and regulations affecting the
environment; interest rates; currency translation movements; Year 2000
compliance; and other risks that are detailed from time to time in reports
filed by the Company with the Securities and Exchange Commission.
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For media relations, call: For investor relations, call:
Molly Remes William Tolley/Joel Mostrom
804-697-1110 804-697-1157/804-697-1147
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Joele Frank or Andy Brimmer
Abernathy MacGregor Frank
212-371-5999
The foregoing and prior press releases issued by Chesapeake relating to the
Offer have referred to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. While Section 21E of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") is not applicable to forward-
looking statements made in connection with a tender offer, it has not been
judicially determined whether the safe harbor provided by Section 21E of the
Exchange Act applies to forward-looking statements in a consent solicitation
conducted in connection with a tender offer.
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SIGNATURES
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Dated: December 22, 1999
CHESAPEAKE CORPORATION
/s/ J. P. Causey Jr.
By: _________________________________
J. P. Causey Jr.
Senior Vice President, Secretary
& General Counsel
SHEFFIELD, INC.
/s/ J. P. Causey Jr.
By: _________________________________
J. P. Causey Jr.
Vice President & Secretary
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