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1
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FINAL ORDER AND JUDGMENT PURSUANT TO COURT OF CHANCERY RULE 54(B)
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EXTRACTED KEY WORDS
SUPERMAJORITY BYLAW COURT RELATING DEFENDANTS SHOREWOOD DIRECTORS REMOVAL COUNTERCLAIM OPINION RELIEF SET CHANCERY CHESAPEAKE OFTHE LAW HEREBY OFFKERS EMPLOYEES AGENTS ACTING CONCERT RELYING ENFORCING SUPER-MAJORITY BYLAW MERITS PREJUDICE ACCORDANCE ALLOCATION COSTS EXPENSES ATTORNEYS FEES |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CHESAPEAKE CORPORATION and
SHEFFIELD, INC.
Plaintiffs, i C.A. No. 17626
V. ;
>
MARC P SHORE, HOWARD M.
LIEBMAN, ANDREW N. SHORE, ;
LEONARD J. VEREBAY, VIRGINIA A. )
KAMSKY, SHARON R. FAIRLEY, R. )
TIMOTHY O'DONNELL, KEVIN J.
BANNON, WILLIAM P. WEIDNER, 1
and SHOREWOOD PACKAGING >
CORPORATION,
i
Defendants. )
FINAL ORDER AND JUDGMENT
PURSUANT TO COURT OF CHANCERY RULE 54(b)
WHEREAS in this action the plaintiffs asserted, inter alia, claims relating to Article X
Amended and Restated By-laws of defendant Shorewood Packaging Corporation, as amended
(respectively, the "Supermajority Bylaw Claims," the "Supermajority Bylaw" and "Shorewood");
WHEREAS in this action the defendants asserted counterclaims relating to (i) Section 203
of the General Corporation Law (the "Section 203 Counterclaim") and (ii) the ability of the
of Shorewood to be removed without cause (the "Removal Counterclaim");
WHEREAS with the approval ofthe Court, the parties tried the Supermajority Bylaw Claims,
the Section 203 Counterclaim and the Removal Counterclaim on the grounds that resolution ofthose
claims was necessary before Chesapeake could proceed with its consent solicitation (the "Tried
Claims"), and
WHEREAS the Court issued an opinion dated February 7, 2000 (the "Opinion") resolving
the Tried Claims and making findings of fact and reaching conclusions of law relating thereto,
SNIPPETS:
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2
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MEMORANDUM OPINION
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EXTRACTED KEY WORDS
DEFENDANTS SHOREWOOD CHESAPEAKE COURT KAMSKY BYLAW STOCKHOLDERS ESQUIRE VICE CHANCELLOR DIRECTORS MEETING OPINION CONSENT SOLICITATION ARIEL DELAWARE MARC SHORE SUPERMAJORITY BYLAW SHAREHOLDERS ARIEL AGREEMENT MANAGEMENT TRANSACTION INVESTMENT ACQUISITION INADEQUATE REASONABLENESS PROXY FIGHT EFFECTIVENESS LITIGATION COMMUNICATION |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CHEASAPEAKE CORPORATION and
SHEFFIELD, INC.,
>
Plaintiffs, >
V. Civil Action No. 17626
MARC P. SHORE, HOWARD M. LIEBMAN i
ANDREW N. SHORE, LEONARD J. VERABAY, )
VIRGINIA A. KAMSKY, SHARON R. FAIRLEY, )
R. TIMOTHY O'DONNELL, KEVIN J. BANNON )
WlLLIAM P. WEIDNER, and SHOREWOOD )
PACKAGING CORPORATION,
;
Defendants. >
MEMORANDUM OPINION
Date Submitted: January 28,200O
Date Decided: February 7,200O
Jesse A. Finkelstein, Esquire, C. Malcolm Cochran, IV, Esquire, Anne C. Foster,
Esquire, Lisa A. Schmidt, Esquire, J. Travis Laster, Esquire, Srinivas M. Raju, Esq-uire,
Michael D. Allen, Esquire, of RICHARDS, LAYTON & FINGER, Wilmington,
Delaware; OF COUNSEL: James E. Far&am, Esquire, Edward J. Fuhr, Esquire, Stacy
~Colvin Taylor, Esquire, of HUNTON & WILLIAMS, Richmond, Virginia, Attorneys
for Plaintiffs.
Edward P. Welch, Esquire, Robert S. Saunders, Esquire, Martina Bernstein, Esquire,
Julie A. To&up, Esquire, of Skadden, Arps, Slate, Meagher & Flom, Wilmington,
Delaware, Attorneys for Defendants.
STRINE, Vice Chancellor
This case involves a contest for control between two corporations in
the specialty packaging industry, the plaintiff Chesapeake Corporation and
the defendant Shorewood Packaging Corporation, whose boards of directors
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3
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OPENING POST-TRIAL BRIEF OF CHESAPEAKE AND SHEFFIELD
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EXTRACTED KEY WORDS
SHOREWOOD KAMSKY CHESAPEAKE FAIRLEY LIEBMAN VEREBAY BANNON DIRECTORS DEL BYLAW MARC SHORE DEFENDANT STOCKHOLDER DELAWARE MEETING BYLAW AMENDMENTS PROCEEDING SUPERMAJORITY BYLAW CONSENT SOLICITATION SHOREWOOD PACKAGING SHAREHOLDERS ACQUISITION MANAGEMENT JCG AUTHORITIES WRITTEN MATERIALS STOCKHOLDER FRANCHISE INVESTMENT PRIMARY PURPOSE |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CHESAPEAKE CORPORATION and
SHEFFIELD, INC.,
; PUBLIC VERSION
Plaintiffs,
i Civil Action No. 17626NC
V.
;
MARC P. SHORE, HOWARD M. >
LIEBMAN, ANDREW N. SHORE, 1
LEONARD J. VEREBAY, VIRGINIA A.
KAMSKY, SHARON R. FAIRLEY, R.
TIMOTHY O'DONNELL, KEVIN J.
BANNON, WILLIAM P. WEIDNER, and
SHOREWOOD PACKAGING
CORPORATION,
Defendants.
OPENING POST-TRIAL BRIEF OF
CHESAPEAKE CORPORATION AND SHEFFIELD, INC.
Jesse A. Finkelstein
C. Malcolm Co&ran, IV
Anne C. Foster
Lisa A. Schmidt
OF COUNSEL: J. Travis Laster
Michael D. Allen
James E. Farnham Michael 3. Merchant
Edward J. Fuhr Richards, Layton & Finger
Stacy Calvin Taylor One Rodney Square
Hunton & Williams P. 0. Box 551
Riverfront Plaza Wilmington, DE 19899
95 1 East Byrd Street (302) 658-6541
Richmond, VA 23219-4074 Attorneys for Plaintiffs
Dated: January 21,200O
RLI'I-2109107-1
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4
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DEFENDANTS OPENING POST-TRIAL BRIEF
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EXTRACTED KEY WORDS
CHESAPEAKE STOCK UNDERSTANDING ARIEL AGREEMENT FAIRLEY KAMSKY JOHNSON SHOREWOOD BOARD STOCKHOLDERS SUPPORT OUTSTANDING STOCK INCENTIVES SHARES OWNER ACQUISITION ARRANGEMENT SHEFFIELD COUNTERCLAIMS CHESAPEAKE BID SHOREWOOD PACKAGING RENDERS CHESAPEAKE SUPER-MAJORITY BYLAW PROPOSED ACQUISITION PLAINTIFFS REMOVAL PROPOSALS MORTON DEP CHESAPEAKE ADMITS DIRECTORS |
PUBLIC VF.RS:LON - JANUARY 26, 2000
IS+
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CHESAPEAKE CORPORATION and :
SHEFFIELD, INC.,
Plaintiffs/
Counterclaim-Defendants, :
V. Civil Action No. 17626NC
MARC P. SHORE, HOWARD M. :
LIEBMAN, ANDREW N. SHORE, :
LEONARD J. VEREBAY, VIRGINIA A. :
KAMSKY, SHARON R. FAIRLEY,
R. TlMOTHY O'DONNELL, KEVIN J. :
BANNON, WILLIAM P. WEIDNER,
and SHOREWOOD PACKAGING :
CORPORATION,
Defendants/
Counterclaimants.
i ! /*-
DEFENDANTS' OPENING POST-TRIAL BRIEF L: .::
-`. ci
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
One Rodney Square
Post Office Box 636
Wilmington, Delaware 19899-0636
(302) 6.5 l-3000
Attorneys for DefendantslCounterclaimants
DATED: January 2 1,200O
TABLE OF COh'TENTS
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5
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PRE-TRIAL BRIEF OF CHESAPEAKE CORP. AND SHEFFIELD INC. WITH RESPECT TO BYLAW CLAIMS
|
EXTRACTED KEY WORDS
BYLAW STOCKHOLDERS MARC SHORE CHESAPEAKE SUPER-MAJORITY BYLAW DEP LIEBMAN DEL DELAWARE COURT MEETING BOARD MEMBERS DIRECTORS KAMSKY BANNON BYLAW AMENDMENTS CONSENT SOLICITATION ORIGINAL SUPER-MAJORITY BYLAW INDIVIDUAL DEFENDANTS PLAINTIFFS SHAREHOLDERS STOCKHOLDER FRANCHISE EFFECTIVENESS REASONABLENESS COMPENSATION PROXY CONTEST JUSTIFICATION ENTRENCHING DELAWARE LAW |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CHESAPEAKE CORPORATION and
SHEFFIELD, INC.,
PUBLIC VERSION
Plaintiffs,
Civil Action No. 17626NC
V.
MARC P. SHORE, HOWARD M.
LIEBMAN, ANDREW N. SHORE,
LEONARD J. VEREBAY, VIRGINIA A.
KAMSKY, SHARON R. FAIRLEY, R.
TIMOTHY O'DONNELL, KEVIN J.
BANNON, WILLIAM P. WEIDNER, and
SHOREWOOD PACKAGING
CORPORATION,
_..
..,
Defendants. I "_
:
r`
.h _'
:
-i
.
:' 1,. ;
PRE-TRIAL B R I E F O F C H E S A P E A K E CORPORATION AND * `.
SHEFFIELD, INC. WITH RESPECT TO THE BYLAW CLAIMS c; 1
R. Franklin Balotti
OF COUNSEL: Jesse A. Finkelstein
Anne C. Foster
James E. Farnham Richards, Layton & Finger
Edward J. Fuhr One Rodney Square
Stacy Colvin Taylor P. 0. Box 551
Hunton & Williams Wilmington, DE 19899
Riverfront Plaza (302) 658-6541
95 1 East Byrd Street Attorneys for
Richmond, VA 232 19-4074 Chesapeake Corporation
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6
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DEFENDANTS PRE-TRIAL BRIEF
|
EXTRACTED KEY WORDS
AMENDED SUPER-MAJORITY BYLAW CHESAPEAKE DIRECTORS COURT STOCKHOLDERS ARIEL PROVISIONS DELAWARE STOCK VOTE SHARES DGCL DEL ARIEL AGREEMENT TENDER SHAREHOLDERS ACQUISITION SHOREWOOD PACKAGING CONSISTENT OUTSTANDING STOCK REASONABLENESS COUNTERCLAIMS PLAINTIFFS BYLAW AMENDMENTS TRANSACTION CONSENT SOLICITATION VOTE REQUIREMENT USACAFES INADEQUATE |
PUBLIC VERSION
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CHESAPEAKE CORPORATION and
SHEFFIELD, INC.,
Plaintiffs/
Counterclaim-Defendants,
V.
MARC P. SHORE, HOWARD M.
LIEBMAN, ANDREW N. SHORE,
LEONARD J. VEREBAY, VIRGINIA A.
KAMSKY, SHARON R. FAIRLEY,
R. TIMOTHY O'DONNELL, KEVIN J.
BANNON, WILLIAM P. WEIDNER,
and SHOREWOOD PACKAGING
CORPORATION,
Defendants/
Counterclaimants.
DEFENDANTS' PRE-TRIAL BRIEF
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
One Rodney Square
Post Office Box 636
Wilmington, Delaware 19899-0636
(302) 65 I-3000
Attorneys for Defendants/Counterclaimants
DATED: January 6,200O
TABLE OF CONTENTS
T A B L E O F C A S E S A N D A U T H O R I T I E S
P R E L I M I N A R Y S T A T E M E N T
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7
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REPLY TO COUNTERCLAIMS
|
EXTRACTED KEY WORDS
ALLEGATIONS PARAGRAPH CHESAPEAKE RESPONSE REFERENCE SHEFFIELD THEREOF SHOREWOOD PACKAGING LAW ARIEL FIRST SENTENCE SECOND SENTENCE RESPONSIVE PLEADING CERTIFICATE SHEFFIELD LACK KNOWLEDGE STOCK PURCHASE INFORMATION SUFFICIENT TRUTH PRELIMINARY CONSENT STATEMENT AGREEMENT DELAWARE INCORPORATION AMENDMENT GENERAL CORPORATION LAW LANGUAGE THEREOF THIRD SENTENCE SENTENCES OFPARAGRAPH SCHEDULE PARTY |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
F
IN AND FOR NEW CASTLE COUNTY
CHESAPEAKE CORPORATION and
SHEFFIELD, INC.,
Plaintiffs,
C.A. No. 17626
V.
MARC P. SHORE, HOWARD M.
LlEBMAN, ANDREW N. SHORE,
LEONARD J. VEREBAY, VIRGINIA A.
KAMSKY, SHARON R. FAIRLEY,
R TIMOTHY O'DONNELL, KEVIN J.
BANNON, WILLIAM P. WEIDNER, and
SHOREWOOD PACKAGING
CORPORATION,
Defendants,
REPLY TO COUNTERCLAIMS
Chesapeake Corporation ("Chesapeake") and Sheffield, Inc. ("Sheffield"), bytheir
reply to the Counterclaims of Shorewood Packaging Corp. (the "Counterclaims"), as follows:
97. In response to Paragraph 97, Chesapeake and Sheffield incorporate by reference the
allegations of the Complaint.
98. Chesapeake and Sheffield lack knowledge or information sufficient to form a belief
as to the truth of the allegations of the first sentence of Paragraph 98 of the Counterclaims,
that it is admitted that Ariel Capital Management, Inc. ("Ariel") is not a party to this action
a registered investment advisor. The allegations of the second sentence of Paragraph 98 of the
Counterclaims are denied, except that it is admitted that Chesapeake and Sheftield filed a
Preliminary Consent Statement with the Securities and Exchange Commission (the "SEC") on
December 3, 1999, reference to which is made for the terms and contents thereof.
RLFI-2099894-l
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8
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ANSWER AFFIRMATIVE DEFENSES AND COUNTERCLAIMS OF DEFENDANTS
|
EXTRACTED KEY WORDS
PLAINTIFFS SHOREWOOD STOCK DEFENDANTS TENDER COMPLAINT PARAGRAPHS COMMON STOCK RESPONSE SHARES SHORE ARIEL STOCK PURCHASE AGREEMENT THEREOF DELAWARE PROPOSALS SHOREWOOD BOARD STOCKHOLDER INCOMPLETE MISLEADING CHARACTERIZATION OUTSTANDING SHARES DIRECTORS AFFILIATES CHESAPEAKE COUNTERCLAIMS ACCORDANCE ACQUISITION PROPOSED ACQUISITION FULLY SET |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
____--_--_-__---_---------------- X
CHESAPEAKE CORPORATION and >
SHEFFIELD, INC., >>
Plaintiffs, >>
V.
> .I
> No. 17626 NC :, 1
MARC P. SHORE, HOWARD M. >
LIEBMAN, ANDREW N. SHORE, > _`.
LEONARD J. VEREBAY, VIRGINIA A. )
KAMSKY, SHARON R. FAIRLEY, > -5.
R. TIMOTHY O'DONNELL, KEVIN J. >
BANNON, WILLIAM P. WEIDNER >
and SHOREWOOD PACKAGING >
CORPORATION, >>
Defendants. >
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - X
ANSWER, AFFIRMATIVE DEFENSES
AND COUNTERCLAIMS OF DEFENDANTS
Defendants Marc P. Shore, Howard M. Liebman, Andrew N. Shore,
Leonard J. Verebay, Virginia A. Kamsky, Sharon R. Fairley, R. Timothy 0' Donnell,
Kevin J. Bannon, William P. Weidner (collectively, the "Director Defendants") and
Shorewood Packaging Corporation ("Shorewood" or the "Company," together with the
Director Defendants, the "Defendants"), by their undersigned counsel, answer Plaintiffs'
Complaint ("Complaint") in accordance with the numbered paragraphs thereof as follows:
NATURE OF THE ACTION
1. Admitted in part and denied in part. Admitted that on December 3,
1999, Plaintiffs commenced a tender offer for Shorewood's common stock at 9; 17.25 per
share (the "Tender Offer"). The remaining allegations are denied.
2. Admitted in part and denied in part. Admitted that Plaintiffs
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9
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LETTER TO V.C. STRINE
|
EXTRACTED KEY WORDS
PLAINTIFFS CONSENT DIRECTORS STOCKHOLDERS COURT SHOREWOOD PRELIMINARY INJUNCTION CONSENT SOLICITATION SLIP DEL REVIEW DEFENDANTS POWER MERITS STRINE AUTHORITY USACAFES HONORABLE LEO CHANCELLOR REASONS BYLAW AMENDMENTS COMPLAINT WRITTEN CONSENT TENDER IMPROPER DGCL EDELMAN SLIP VALIDITY INJUNCTIVE RELIEF |
S K A D D E N , A R P S , S L A T E , M E A G H E R &
O N E R O D N E Y SQUARE
P.O. B O X 6 3 6
W I L M I N G T O N , D E L A W A R E
T E L : (302) 6.51-3000
F A X : (302) 651-3 0 0
DlREc-r DlAL
I3021 6 5 I - 3 0 6 0
DlREcr FAX
(302) 6 5 I - 3 0 0 I
EMAL AODRESS
LWELCH@SKADDEN.COM
December 8, 1999
VIA HAND DELIVERY
The Honorable Leo E. Strine, Jr.
Vice Chancellor
Court of Chancery
Daniel L. Herrmann Courthouse
1020 North King Street
Wilmington, Delaware 1980 1
Re: Chesapeake Corporation, et al. v. Shore, et al.,
Civil Action No. 17626
Dear Vice Chancellor Strine:
We represent Shorewood Packaging Corporation ("Shorewood")
Directors (collectively, the "Defendants") in the above-captioned case. On December 6,
we received courtesy copies of a Motion for Expedited Proceedings in anticipation of
as-yet-unfiled motion for preliminary injunction. For the reasons set forth below, we
believe that under the circumstances presented in this case it would appropriate for
set a date for a preliminary injunction hearing, or grant expedited discovery. The
SNIPPETS:
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10
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COMPLAINT
|
EXTRACTED KEY WORDS
CHESAPEAKE DEFENDANTS TENDER COMMON STOCK SHORE BYLAW STOCKHOLDERS DELAWARE PLAINTIFFS CONSENT SOLICITATION SUPER-MAJORITY BYLAW ACT LAW DIRECTORS BYLAW AMENDMENTS ACQUISITION PREMIUM TENDER SHOREWOOD PACKAGING PROPOSED ACQUISITION FIDUCIARY DUTIES RIGHTS PLAN WRITTEN CONSENT OUTSTANDING STOCKHOLDER FRANCHISE DEFENDANTS OWE GENERAL CORPORATION LAW PROPOSED MERGER INCORPORATION POTENTIAL ACQUISITION |
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
CHESAPEAKE CORPORATION and
SHEFFIELD, INC.,
Plaintiffs,
V.
MARC P. SHORE, HOWARD M.
LIEBMAN, ANDREW N. SHORE,
LEONARD J. VEREBAY, VIRGINIA A. /b
KAMSKY, SHARON R. FAIRLEY, R. *
TIMOTHY O'DONNELL, KEVIN J. <
i
BANNON, WILLIAM P. WEIDNER, and
SHOREWOOD PACKAGING
CORPORATION,
Defendants.
COMPLAINT
Plaintiffs Chesapeake Corporation ("Chesapeake") and Sheflield, Inc. ("Purchaser," jointly
with Chesapeake, "Plaintiffs"), by and through its undersigned att'orneys, upon knowledge as to
themselves and their own acts and upon information and belief as to all other matters, allege for
complaint against Marc P. Shore, Howard M. Liebman, Andrew N. Shore, Leonard J. Verebay,
Virginia A. Kamsky, Sharon R. Fairley, R. Timothy O'Donnell, Kevin J. Bannon, William P. Weidner
(collectively, the "Director Defendants") and Shorewood Packaging Corporation ("Shorewood" or
the "Company," together with the Director Defendants, the "Defendants"), as follows:
NATURE OF THE ACTION
1. Plaintiffs commenced today a fully-financed, non-coercive, non-discriminatory,
cash, all-shares premium tender offer for Shorewood's common stock at $17.25 per share (the
"Tender Offer"). The $17.25 in cash offered in the Tender Offer represents approximately a 45%
RLFl-2078660-5
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