Full opinion text
DECISION AND ORDER STADTMUELLER, District Judge. This matter is before the court on four separate motions each of which seeks preliminary injunctive relief. These motions, three of which were filed by the plaintiff and one of which was filed by the defendants, include 1. plaintiff’s motion to enjoin operation of the defendants’ shareholders rights plan (the poison pill); 2. plaintiff’s motion for injunctive relief declaring Wisconsin’s Business Combination Act, Wis.Stat. § 180.726, unconstitutional; 3. plaintiff’s motion for injunctive relief regarding defendants’ alleged Federal securities laws claims; and 4. defendant/counterclaim plaintiff's motion to enjoin plaintiff’s tender offer on account of alleged violations of Federal securities laws as well as alleged violations of the margin rules promulgated by the Federal Reserve Board. Following expedited discovery and briefing the issues, a two-day evidentiary hearing was held in conjunction with these motions on February 2 and 3 of this year. At the outset I wish to commend the parties and their counsel for the thoroughness in their presentations to the court, considering the severe time constraints under which voluminous documents were reviewed, witnesses deposed, and legal authorities presented in support of their respective positions. Following a review of the parties’ submissions, I am now ready to render my decision on each of the four motions. Plaintiff’s claims arise under the United States Constitution and §§ 14(d), 14(e) and 28 of the Exchange Act, (the Exchange Act) 15 U.S.C. §§ 78n(e) and 78bb, and the rules and regulations promulgated thereunder. Defendant’s counterclaims arise under §§ 7, 14(d), 14(e), 27 and 28 of the Exchange Act, 15 U.S.C. §§ 78(g), 78n(d), 78n(e), 78aa and 78bb, and the rules and regulations promulgated thereunder. Jurisdiction is conferred on this court under § 27 of the Exchange Act, 15 U.S.C. § 78aa and 28 U.S.C. §§ 1331 and 1337, and the doctrine of pendent jurisdiction. I. FACTS The parties have agreed to a limited number of facts in this case. The remainder of the facts are derived from the testimony at the hearing, the exhibits, affidavits, and deposition transcripts which have been filed with the court. A. The Parties Plaintiff Amanda Acquisition Corporation (Amanda) is a Delaware corporation with its principal executive offices in Burlington, Massachusetts. It was formed on November 23, 1988 for the purpose of acquiring defendant Universal Foods Corporation (Universal, Universal Foods, or the Company) and is not engaged in any other business. Amanda is a wholly owned subsidiary of counterclaim defendant High Voltage Engineering Corporation (HVE), a Massachusetts corporation with its principal executive offices also located in Burlington, Massachusetts. HVE was purchased in a hostile tender offer in early 1988 by counterclaim defendant Hyde Park Partners, L.P. (Hyde Park). Hyde Park is a Delaware limited partnership, 50 percent of which is owned by defendant Hyde Park Holdings, Inc. (Holdings), a New York corporation, and affiliates controlled by defendants Laurence S. Levy and Clifford Press. The remaining 50 percent interest is owned by additional counterclaim defendant Oxbridge Capital Corporation (Oxbridge), a Delaware corporation and a wholly owned subsidiary of another additional counterclaim defendant, Berisford Capital Corporation (Berisford Capital), a New York corporation which is itself an indirect wholly owned subsidiary of additional counterclaim defendant S. & W. Berisford PLC (Berisford PLC), an English public limited company. Holdings is controlled by Messrs. Levy and Press and is the sole general partner of Hyde Park. The business address of Levy and Press is New York, New York. Levy is chairman of the board and secretary of Amanda. He is also chairman of the board and vice president of HVE, and chairman of the board, secretary and treasurer of Holdings. Press serves as president, treasurer and a director of Amanda. He is also deputy chairman of the board and vice president of HVE and president and a director of Holdings. Defendant and counterclaim plaintiff Universal Foods is a Wisconsin corporation with its principal executive offices located in Milwaukee, Wisconsin. Universal is a diversified manufacturer and marketer of food ingredients and certain consumer food items. Products manufactured by Universal include cheese, yeast, frozen food, dehydrated products, and flavoring and coloring ingredients. Universal Foods’ common stock is registered pursuant to § 12 of the Exchange Act, 15 U.S.C. § 781, and is listed and traded on the New York Stock Exchange and the Pacific Stock Exchange. The market price for Universal’s common stock, adjusted for stock splits, was $9.67 per share on September 30, 1984, and rose to $24.00 per share by September 30, 1988. Defendant Guy A. Osborn became chief executive officer of Universal Foods on October 1, 1988 and has served as president since 1984 and as a director of the company since 1983. Defendant John L. Murray is chairman of the board of Universal Foods and was, until October 1, 1988, chief executive officer of the company. Defendant Darrell E. Wilde is a senior vice president and a director of Universal Foods. The remaining defendants, Alan R. Anderson, Michael E. Batten, Dr. Oían D. Forker, Dr. Carol I. Waslien Ghazaii, Leon T. Kendall, Paul L. Kohnstamm, Charles S. McNeer, Dr. Bernard S. Schweigert and Gerard E. Veneman are all directors of Universal Foods. Defendant Orville R. Mertz was a director of Universal until he retired on January 26, 1989, after reaching the mandatory retirement age. Each of the individual defendants, other than Osborn, Murray and Wilde, are non-management and independent directors of Universal. Each is also a business or professional person with either experience in general business matters or special expertise in the particular areas in which Universal transacts business. For instance, Veneman is the retired president of Nekoosa Papers, Inc. Kendall is chairman of the board of the Mortgage Guarantee Insurance Company. McNeer is chairman of the board and chief executive officer of Wisconsin Energy Corporation. Anderson is chairman of the board and chief executive officer of P.A. Bergner and Company. Batten is president and chief executive officer of Twin Disc, Inc. Dr. Forker is a professor in the department of agricultural economics at Cornell University. Dr. Was-lien Ghazaii is a professor and program director for the nutrition and food service program at the City University of New York, Hunter College. Kohnstamm is president of General Color Company. Mertz is chairman of Mertz, Inhorn and Associates. Dr. Schweigert is chairman of the department of food science and technology in the college of agriculture and environmental sciences at the University of California, Davis. B. The Tender Offer On December 1,1988 Amanda announced a tender offer to acquire all shares and rights of Universal Foods at a price of $30.50 per share in cash. This offer was communicated to Universal management by way of a phone call from Mr. Press to Mr. Osborn at approximately 3:12 P.M. CST on December 1, 1988. The letter from Press to Universal’s management announcing the offer was hand delivered to Osborn about 4:00 P.M. Between these two occurrences this action was filed, at approximately 3:45 P.M. Amanda officially commenced its offer with the filing of its schedule 14D-1 with the Securities and Exchange Commission (SEC) on December 2, 1988. Amanda’s offer was conditioned upon the following: (a) Seventy five percent of the outstanding shares being tendered by the shareholders; (b) A final judgment finding the Wisconsin Business Combination Act to be either unconstitutional or inapplicable to the offer; (c) Redemption of the shareholders rights plan (Rights Plan or Poison Pill) (d) A declaration of ineffectiveness against Amanda of Article 10 of Universal’s restated Articles of Incorporation, the “put” provision; and (e) Amanda being able to obtain sufficient financing to enable it to purchase all outstanding shares and pay all related fees and expenses. For purposes of the pending motions only the first three conditions are relevant. On December 8, 1988 the Universal board of directors voted to recommend that its shareholders reject the offer at the $30.50 price. On December 15,1988 Amanda announced that it was increasing its offer to $35.00 per share. After a meeting on December 20, 1988 the Universal board voted to recommend that its shareholders reject this revised offer. Amanda had filed its first motion for a preliminary injunction (regarding the statute) on December 14, 1988. A status conference was held with the parties on December 19, 1988, at which the hearing dates of February 2-3, 1989 were established. Shortly thereafter, it was reported in the national press that Amanda was not strenuously pursuing its offer until resolution of the issues before the court. At the time of the February hearing, approximately 17 percent of the outstanding shares of the Universal stock had been tendered or “put into the box” as a result of Amanda’s offer. This number includes approximately 3.6 percent of Universal Foods’ common stock presently owned by Amanda or its affiliates. As of February 17, 1989, as reported in the New York Times, Amanda and HVE had announced that approximately 27 percent of the shares of Universal have been tendered. Additional facts, as they relate to and have an impact on resolution of the individual motions, shall be stated below. II. LEGAL STANDARDS It must be remembered that each of the motions before the court is a motion for preliminary injunction. When seeking a preliminary injunction, the movant bears the burden of establishing the five requirements necessary for the issuance of the injunction: (1) That it has no adequate remedy at law; (2) that it will suffer irreparable harm if the preliminary injunction is not issued; (3) that the irreparable harm it will suffer if the preliminary injunction is not granted outweighs the irreparable harm the defendant will suffer if the injunction is granted; (4) that it has a reasonable likelihood of prevailing on the merits; and (5) that the injunction will not harm the public interest. Curtis v. Thompson, 840 F.2d 1291, 1296 (7th Cir.1988); Baja Contractors, Inc. v. City of Chicago, 830 F.2d 667, 675 (7th Cir.1987), cert. denied, — U.S. -, 108 S.Ct. 1301, 99 L.Ed.2d 511 (1988), citing Manbourne, Inc. v. Conrad, 796 F.2d 884, 887 (7th Cir.1986). There is persuasive authority that the movant’s demonstration of irreparable injury implies that the remedies at law are inadequate. See Fleet Wholesale Supply Co., Inc. v. Remington Arms Co., Inc., 846 F.2d 1095 (7th Cir.1988). There can be little question that if either of Amanda’s two principal motions relating to the Wisconsin statute and shareholders rights plan were denied, it would suffer irreparable injury. Failure on either of those two motions may well preclude a successful hostile takeover by Amanda since the hurdles posed by the Wisconsin Business Combination Act (the Act, or Wisconsin act) and the shareholders rights plan may well prove insurmountable. However, it is my conclusion that granting the injunction on either of those issues would be equally harmful to Universal. If Amanda succeeds on those issues Universal’s defensive measures become nonexistent. If the takeover offer is allowed to proceed on present terms and is successful, it is impossible for Universal to turn the clock back because the company will be sold. Under these circumstances, the balance of the injuries to the respective parties is approximately equal. See, e.g., Dynamics Corp. of America v. C.T.S. Corp., 794 F.2d 250, 252 (7th Cir.1986), reversed on other grounds, C.T.S. Corp. v. Dynamics Corp. of America, 481 U.S. 69, 107 S.Ct. 1637, 95 L.Ed.2d 67 (1987). In deciding these two motions, I find that the determining factor in granting or denying the injunction turns on the likelihood of plaintiff’s ultimate success on the merits. As concerns the other two motions, plaintiff’s motion regarding the Williams Act violations and defendants’ motion regarding Williams Act and margin rules violations, as will be seen below, the balance of harms to the respective parties is not as equal and will play a more determining role in resolution of those two motions. III. UNIVERSAL’S MOTION In its two-part motion, Universal seeks to enjoin the tender offer pending complete compliance with both the margin rules and the Williams Act disclosure requirements. Plaintiff and counterclaim defendants oppose the motion, arguing (1) that Universal has no standing to litigate margin rule violations; (2) that Universal’s Williams Act claims are without merit; and (3) in any event, any margin rule or Williams Act violations have been mooted by the January 30, 1989 filing of amendment 13 to Amanda’s schedule 14d-l. Plaintiff and counterclaim defendants contend that this latest amendment does everything which the law requires of them, even if Universal’s claims had merit. I will address this motion first because if this motion is successful, the need to resolve the other motions may be moot. However, my review of the materials and legal authorities brought to the court’s attention convince me that Universal’s motion should be denied. Defendants’ motion raises questions about the financing and control structure of the Amanda offer. Through discovery in this case, it has been determined that the relationships among the Acquisition Group parties are extremely complex. The corporate structure as presented by Universal at the hearing and modified in the testimony of Mr. Press is attached as Appendix B. The financing is almost as complex. Amanda is contributing $10 million in equity to the total cost of the offer. Press’s testimony established that this $10 million contribution could realistically be traced back to Berisford. Berisford Capital is purchasing $110 million in preferred stock in Amanda. The preferred stock has no right of redemption and at present has no stated dividend rate. Amendment 13 to Amanda’s Schedule 14D-1 states that the stock will pay such dividends as are declared from time to time by the board of the purchaser (i.e. Amanda). The parties anticipate that following the offer, the board of the purchaser will determine a fair and appropriate dividend rate in light of the circumstances of the time. Additional funds will be provided by Chase Manhattan Bank. Chase will provide up to 50% of the purchase price, which is to be secured by the stock of Universal. All parties agree that this is a margin loan. (The offer does have an alternative financing structure in the event of a friendly merger. I do not find this relevant, notwithstanding Amanda’s experts’ contentions to the contrary, because at this juncture this is a hostile takeover and there seems to be little chance of it converting to a friendly merger.) In addition to the Chase loan, Kidder Peabody & Co. will supply financing in the amount of $159 million, which will be senior subordinated debt. Kidder will raise the money by issuing high yield bonds, or “junk bonds.” The final amount of money will be provided by Berisford Capital which will supply $75 million in junior subordinated debt. Both the Kidder and Berisford Capital investments are subordinate to the Chase loan. HVE has guaranteed the loans to both Kidder and Berisford Capital. This, Amanda argues, brings them within one of the safe harbors of the Federal Reserve’s margin rules to escape the presumption that these type of loans would be indirectly secured by the stock of the target and so also be a margin loan. In turn, HVE’s guarantees are backed by Berisford PLC. Universal also raises the issue of who is really controlling this offer. Universal contends that Berisford PLC is controlling this offer and Messrs. Levy and Press are just agents or fronts for Berisford PLC. Universal asks that the court enjoin the tender offer and force the Acquisition Group to sit down and prepare a concise, clear and complete tender offer which reflects the relationship of the parties and complies in full with the margin rules, and communicate such offer to the shareholders. A. Margin Rules Both parties rely on Bassler v. Central National Bank in Chicago, 715 F.2d 308 (7th Cir.1983), in disputing whether Universal has a right to assert Amanda’s violation of the margin requirements as set forth in § 7(d) of the Exchange Act, 15 U.S.C. § 78g(d) and the regulations promulgated thereunder. Amanda finds support for the simple proposition that there is no right of action under the margin rules. Universal claims the holding in Bossier is limited to its own facts, and that the court did not consider the possibility of a right of action existing in a target corporation. The discussion in Bossier does support Universal’s position, as the court only clearly considered application of the rules to individual investors and stated its conclusion in narrow terms: “[Tjhere is no indication of legislative intent, explicit or implicit, to create a private right of action in individuals in Bassler’s position as against lenders in Central’s position.” Id. at 313. Similarly, while other circuits probing the question have denied a private right of action, often in broad terms, they do not appear to have considered the issue of standing vis-a-vis the target corporation. Bossier, 715 F.2d at 312 (and sources cited therein). The guidelines set out in Cort v. Ash, 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975), rev’g 496 F.2d 416 (3d Cir.1974) for determining the existence of a private right of action govern this case. Cort outlined four requirements for an implied right of action: (1) Whether plaintiff belongs to the class for whose “especial benefit” the statute was enacted; (2) whether there is any indication of legislative intent, explicit or implicit, either to create such a remedy or to deny one; (3) whether implying such a remedy is consistent with the underlying purpose of the legislative scheme; and (4) whether the cause of action is “traditionally relegated to state law, in an area basically the concern of the States, so that it would be inappropriate to infer a cause of action based solely on federal law.” Id. 422 U.S. at 78, 95 S.Ct. at 2087. In Bassler, the seventh circuit explicitly recognized that the second of the above four factors — legislative intent — is the key and that the Cort mode is but one of several permissible approaches to ascertainment of that intent. Bassler, 715 F.2d at 310. Despite the narrow wording of the Bossier court’s conclusion, its analysis has broader implications, indicating that no congressional intent to create a private right of action exists in pertinent legislative history. Id. at 311-13. In fact, “[t]he main purpose [of the 1934 act was] to give a Government credit agency an effective method of reducing the aggregate amount of the nation’s credit resources which can be directed by speculation into the stock market and out of other more desirable uses of commerce and industry____” House Comm. on Interstate and Foreign Commerce, Report on H.R. 9323, H.R.Rep. No. 1383, 73d Cong., 2d Sess. 8 (1934) (quoted in Bassler, 715 F.2d 308 (1983)). The margin regulations provide the government with tools for use in credit regulation. That a target company might incidentally benefit from these regulations does not necessarily create a right in favor of such companies. Cf. Santa Fe Industries, Inc. v. Green, 430 U.S. 462, 478, 97 S.Ct. 1292, 1303, 51 L.Ed.2d 480 (1976) (“As in Cort v. Ash, 422 U.S. 66, 80, 95 S.Ct. 2080, 2089, 45 L.Ed.2d 26 (1975), we are reluctant to recognize a cause of action here to serve what is ‘at best a subsidiary purpose’ of the federal legislation.”); Bassler, 715 F.2d at 313. A few courts have found that target companies had a private right of action under § 7. Perhaps the best reasoning toward this end is found in Pabst Brewing Co. v. Jacobs, [1982-83 Transfer Binder] Fed.Sec.L.Rep. (CCH) ¶ 99,042, 1982 WL 1370 (D.Minn. March 8, 1982). Noting the Exchange Commission’s concern for instability in the prices of individual securities, the Pabst court reasoned: The issuer is clearly a member of the class whom Congress intended to benefit by enactment of the statute. Cort, 422 U.S. at 78 [95 S.Ct. at 2087]. The language of § 7, itself, suggests the availability of a private cause of action. In Touche Ross [v. Redington ], 442 U.S. [560] at 569 [99 S.Ct. 2479, 2485, 61 L.Ed.2d 82], the Supreme Court refused to find a private right of action because the language of the statute at issue ‘neither confers rights on private parties nor proscribes any conduct as unlawful.’ In contrast, § 7 expressly proscribes as unlawful the extension or receipt of credit in contravention of the margin rules____ Congressional intent to create a private right of action can also be inferred from the “contemporary legal context” in which amendments to the statute were enacted. Cannon [v. University of Chicago ], 441 U.S. [677] at 698-99 [99 S.Ct. 1946 at 1958, 60 L.Ed.2d 560]. At the time Congress enacted the 1968 and 1970 amendments to § 7, a number of courts had held that there was an implied right of action under § 7. See, e.g., Livingston v. Weis, Voisin, Cannon, Inc., 294 F.Supp. 676, 681 (D.N.J.1968); Sezysko [Serzysko] v. Chase Manhattan Bank, 290 F.Supp. 74 (S.D.N.Y.1958 [1968]), aff'd per curiam on opinion below, 409 F.2d 1360 (2d Cir.), cert. denied, 396 U.S. 904, 90 S.Ct. 218, 24 L.Ed.2d 180 (1969); Remar v. Clayton Securities, 81 F.Supp. 1014 (D.Mass.1949). The third Cort factor also supports implication of a private right under Section 7. The SEC and the Federal Reserve Board have both encouraged courts to imply such a private action as a necessary supplement to the SEC’s enforcement efforts. See, e.g., Palmer v. Thomson & McKinnon, Auchincloss, Inc., 427 F.Supp. 915, 917 n. 1 (D.Conn. 1977); Pargas, Inc. v. Empire Gas Corp., 423 F.Supp. [199] at 251-256 (D.Md.1976). Id. at 94,953. The Pabst court’s reasoning is persuasive in several respects. I realize that allowing a target company a private right of action under § 7 may well serve as a useful supplement to government enforcement efforts. And Congress, in enacting the statute, undoubtedly had some concern for the instability of individual securities issues. But the statute and regulations are distinctly regulatory, proscribing certain conduct without suggesting a corresponding extension of rights. Of course, the central issue is specific congressional intent. While Pabst correctly cites cases for the proposition that an implied right of action existed prior to the 1968 and 1970 amendments, none of these cases consider, or offer an analogue to, target company or issuer standing. The Pabst court implicitly relied on the fact that the 1970 amendments specifically eliminated investor standing, see Stern v. Merrill Lynch, Pierce, Fenner & Smith, 603 F.2d 1073 (4th Cir.1979) (citing cases), without eliminating issuer standing. But I find no authority suggesting that any court ever considered that issuer standing might even be possible under the statute prior to the amendments. Rather, it appears that issuers’ rights are simply not within the contemplation of the statute. Given the “strict approach” to implying private rights of action required by Cort, and the seventh circuit’s impliedly “uninhibited” but vain search for intent in Bassler, I must conclude there is no private right of action under § 7. Cf. Pargas, Inc. v. Empire Gas. Corp., 423 F.Supp. 199 (1976) (finding standing because issuer has personal stake, is subject to injury from violation, and is arguably within the statute’s regulatory zone of interests, or because protection of such parties is supplemental aim of regulations, rather than applying Cort standards), aff'd mem., 546 F.2d 25 (4th Cir.). This absence of intent is affirmed by the clear indication that the margin regulations were not created for the “especial benefit” of target companies. Notwithstanding the unavailability of a private right of action under § 7 of the Exchange Act or the regulations promulgated thereunder, a number of courts have found that a target company does have standing to allege failure to disclose margin violations. See, e.g., Koppers Co., Inc. v. American Express Co., 689 F.Supp. 1371, 1397 (W.D.Pa.1988); Revlon, Inc. v. Pantry Pride, Inc., 621 F.Supp. 804, 814 (D.Del.1985) (and sources cited therein). Each of these courts considered the allegations of margin violations as a violation of Williams Act disclosure requirements. The Acquisition Group contends that amendment 13 to Amanda’s 14D-1, filed January 30, 1989, discloses the allegations which Universal raises and this is sufficient to meet its legal obligations. Avnet, Inc. v. Scope Industries, 499 F.Supp. 1121, 1125 (S.D.N.Y.1980). See also USG Corp. v. Wagner & Brown, 689 F.Supp. 1483, 1492-93 (N.D.Ill.1988) (disclosure of a dispute regarding alleged Hart-Scott-Rodino violations, ás opposed to violations themselves, sufficient to defeat a motion for a preliminary injunction). I believe that, because I do not reach the issue of whether the margin rules were actually violated, a disclosure of alleged violations, without actually admitting that violations exist, does satisfy Amanda’s and the Acquisition Group’s legal obligations. However, while the alleged violations will not support enjoining the tender offer (because without standing or a right to challenge the margin financing Universal has no chance of success on the merits), they will play a role in the outcome of this suit. B. Williams Act Universal has also raised what has been termed by the counterclaim defendants as the “bidder” issue. Universal contends that Berisford PLC is the real party controlling this tender offer and that the Acquisition Group has failed to disclose this material information to the company and the shareholders. Again, the counterclaim defendants contend that amendment 13 moots any of Universal’s claims because Berisford has done everything which would be required of a bidder. Universal responded, at the hearing, that court acceptance of the Acquisition Group’s argument will foster unlawful activity. Universal contends that merely requiring disclosure, without additional sanctions, will lead others to violate the law. The argument continues that parties will violate because at worst all that they will face is the prospect of having to file amendments. Therefore, if they get away with it, well and good; if not, simply correct the matter later. It is settled that the appropriate remedy for a violation of the Williams Act disclosure requirements is disclosure. Rondeau v. Mosinee Paper Corp., 422 U.S. 49, 95 S.Ct. 2069, 45 L.Ed.2d 12 (1975). Universal asks this court to impose an obligation on the parties to turn back the clock, write a new offer to purchase, and communicate that to the shareholders. (Amendment 13 was filed with the SEC but not mailed to the shareholders.) Amanda’s counsel stated to the court that it would communicate whatever information to the shareholders the court required, but requiring a new offer to purchase was not warranted. Berisford counsel argue that all material information has been disclosed and that information which is not disclosed is immaterial. The issue of whether Berisford is really the party on behalf of whom the offer is made is a fact specific question. Messrs. Levy and Press testified that they were the persons actually controlling this offer and the Berisford parties were only kept informed of their decisions. Numerous documents have been brought to the court’s attention which imply that Berisford has the right to control the terms and conditions (including price) of the offer and would control Universal after the acquisition. Levy and Press both testified that those documents did not control the present offer, but admitted that the documents were used in planning the offer. The documents included such control for Berisford as approving the timing and amount of the offer, appointing a majority of the Universal board, providing management expertise in running Universal (Berisford is in the food industry), and providing the majority of the equity for the investment. Berisford officers have testified that they are involved in this offer solely for investment purposes. All Acquisition Group parties have stated they have a good working relationship and as a matter of courtesy inform the others of what events occur and what future steps are planned, which explains the trip to London by Levy and Press to meet with Berisford people prior to increasing the amount of the offer. At present, no complete written agreement between Amanda and Berisford exists with respect to the tender offer for Universal. Certain matters are defined. These include Berisford’s obligation to indemnify the parties for costs incurred through the back end merger, to pay Levy and Press a specified fee for their services both through the merger and (as a management fee) after the merger, and agreed to guarantee the financing guarantees made by HVE to Kidder, Chase, and Berisford Capital. The lack of a written agreement contrasts sharply with the HVE takeover by Hyde Park in early 1988. Levy, Press and Berisford were also involved in that transaction. In that, the parties operated under a comprehensive document which was termed the Hyde Park I Partnership Agreement. The agreement defined the parties respective roles during the acquisition and after the takeover. Universal’s contentions regarding the alleged violations on this issue relate to the failure on the part of the Acquisition Group to completely reveal the relationship and agreements between the parties making the offer, the failure of Berisford to admit it is the party for whom the offer is made, the failure of the Acquisition Group to reveal the margin rule violations, the failure to reveal that Berisford will have to consolidate the debt from this deal on its own balance sheet, and the failure to reveal that Berisford will have to get shareholder approval for its participation in this offer. All of these contentions have been disclosed by the Acquisition Group in its amendments which have been filed with the SEC. Universal, as noted, wants more disclosure. Based on the present record, it is not possible to conclusively state that Berisford is a bidder and controlling this offer. Certainly in the broad sense the tender offer for Universal makes more economic and practical sense if Berisford is viewed as the real party in interest. Berisford is a British food company with growth aspirations in the American market. Berisford is allegedly providing massive sums of capital for this investment, with a relatively small return. And Philip Aaronberg, a director of Berisford PLC, stated that at some point in the next few years they may look to Universal with their “own covetous eyes.” (After reviewing the transcript, it is difficult to ascertain whether the “they” meant Berisford PLC or Hyde Park, of which Berisford indirectly owns 50%.) Levy and Press are young men with no experience in the industries in which Universal operates. HVE has no product lines in common with those of Universal. HVE is also a small company which just recently was purchased by Hyde Park and has little extra cash flow to invest in an offer of this size. However, the only factual testimony presented demonstrates that Levy and Press are the controlling parties to this transaction and Berisford PLC and its subsidiaries are participants for investment purposes. The matters raised by Universal are based on its own inferences and conclusions gleaned from documents which involved the prior discussions between Hyde Park, Berisford and Resource Planning, Inc., a nonparty in this suit. No testimony was presented to rebut that of the Acquisition Group witnesses. For the purpose of this motion, I find that Universal has not met its burden of demonstrating a reasonable likelihood of success on the merits to diminish the need to weigh the respective harms to the parties. If the motion is denied, Amanda’s offer remains on the table, and Universal is forced to use other means which are in the best interests of the shareholders and the corporation to deal with the offer. If the motion is granted, Amanda must in essence start from scratch and may miss a unique business opportunity, namely the acquisition of Universal. Clearly, the harms weigh in favor of Amanda. In addition, the public could be harmed by granting the injunction. If the offer is enjoined pending a full trial on the merits, the shareholders may face the prospect of Amanda withdrawing the offer without a substantial likelihood that Universal will succeed in challenging Berisford’s role. Therefore, Universal’s motion to enjoin the offer pending trial or the Acquisition Group creating a new offer will be denied. As with the alleged margin violations, however, the ambiguities raised by the lack of an agreement, and the prior agreements which the Acquisition Group contends are no longer operable, are relevant to other issues raised by this suit. IV. WILLIAMS ACT MOTION Amanda contends that Universal has violated both sections 14(d)(4) and 14(e) of the Exchange Act, 15 U.S.C. §§ 78n(d)(4) and 78n(e), by making recommendations without complying with the rules and by making untrue statements of material fact. The statutes state in relevant part: (d)(4) Any solicitation or recommendation to the holders of such a security to accept or reject a tender offer or request or invitation for tenders shall be made in accordance with such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors. (e) It shall be unlawful for any person to make any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading, or to engage in any fraudulent, deceptive, or manipulative acts or practices, in connection with any tender offer or request or invitation for tenders, or any solicitation of security holders in opposition to or in favor of any such offer, request or invitation. The Commission shall, for the purposes of this subsection, by rules and regulations define, and prescribe means reasonably designed to prevent such acts and practices as are fraudulent, deceptive, or manipulative. The first allegations concern rules 14e-2(a) and 14d-9(a) promulgated by the SEC pursuant to § 14(d), 17 C.F.R. §§ 240.14e-2(a) and 240.14d-9(a). Rule 14e-2(a) provides that the target company shall provide within ten days of the tender offer a statement to shareholders which either (a) recommends acceptance or rejection of the tender offer, or (b) expresses no opinion and is remaining neutral to the offer, or (c) is unable to take a position with respect to the offer and the reasons why the target management cannot take a position. Rule 14d-9(a) provides that any recommendation must include information and the reasons for the recommendation. The statements which Amanda claims are in violation of the rules include • John Murray’s statement on December 1, 1988 in which he told the press that a meeting of the board would be held in due course and he would recommend the board reaffirm its “not for sale” position. (A schedule 14D-9 was filed by Universal with regard to this statement on December 2, 1988.) • Guy Osborn’s statement in the December 2 14D-9 which said that the statement of Murray was not a recommendation of the board. (The SEC sent a letter to Universal which said the press release violated the rules and to file the proper forms. Universal’s response to the SEC explaining its position on the matter was not answered.) • Lack of reasons for the recommendation in the 14D-9 of December 2. • Statement of Ken Manning, Universal vice president, to the Milwaukee Business Journal for the week of December 5 that Murray planned to recommend rejection of the offer. Amanda claims no 14D-9 was ever filed. • December 7, 1988 filing of a petition by Universal with the Wisc.Comm.Sec. under Wis.Stat. § 552.05(4) which Amanda contends is another recommendation for which no 14D-9 was filed. At the hearing, Amanda withdrew all the issues from consideration except the alleged disclosure violation relating to the December 1, 1988 press release. Amanda contends that when Murray recommended rejection of the offer, he was required to provide reasons for that recommendation. Amanda feels it is important that this failure be disclosed to the shareholders because they have a right to know that Murray had, in its opinion, no reason for his opposition to the offer. The other issues were withdrawn due to the complexity of the record before the court. First of all, it is debatable whether the press release was a recommendation or a “stop, look and listen” communication to the shareholders. The latter is perfectly within a target’s prerogatives without filing a 14D-9. 17 C.F.R. § 240.14d-9(e); Anaconda Co. v. Crane, 411 F.Supp. 1210, 1215 (S.D.N.Y.1975). If it was a “stop, look and listen” communication, no reasons need be given. Secondly, I find that if it was a recommendation, it came from management, not the board of directors. Perhaps more importantly, even if it was a recommendation which did not contain reasons, the issue is moot because of the increased offer. Thus, there is no irreparable injury justifying injunctive relief. See Gulf Corp. v. Mesa Petroleum Co., 582 F.Supp. 1110 (D.Del.1984). Amanda’s other allegations concern violations of § 14(e) which involve the matters of misrepresentations. I construe counsel’s comments as withdrawing these from the court’s consideration as well. Therefore, I need not reach the issue of whether any material misrepresentations were made and whether they would support injunctive relief. V. THE WISCONSIN BUSINESS COMBINATION ACT Amanda’s tender offer is conditioned on, among other things, invalidation of Wisconsin’s Business Combination Act, Wis.Stat. § 180.726, or Amanda’s otherwise being satisfied that the Act is inapplicable to the offer. Amanda contends that the Act is preempted by the Williams Act, 15 U.S.C. §§ 78m(d) and 78n(d)-(e), and therefore violative of the supremacy clause, art. VI, cl. 2 of the United States Constitution. In addition, Amanda contends the Act violates the commerce clause, art. I, § 8, cl. 3 of the United States Constitution because it places an excessive burden on interstate commerce. In taking up the question of whether the Act is violative of the Constitution, I note the well-established principle that every duly enacted state law is entitled to the presumption of constitutionality. See, e.g., Lockport v. Citizens for Community Action, 430 U.S. 259, 272, 97 S.Ct. 1047, 1056, 51 L.Ed.2d 313 (1977), motion denied, 431 U.S. 902, 97 S.Ct. 1692, 52 L.Ed.2d 385. Because a second-step merger is the purpose of the offer, defendants’ reply memorandum at 32, the chief provision in dispute is Wis.Stat. § 180.726(2), which provides: Except as provided in sub. (5), a resident domestic corporation may not engage in a business combination with an interested stockholder of the resident domestic corporation for 3 years after the interested stockholder’s stock acquisition date unless the board of directors of the resident domestic corporation has approved, before the interested stockholder’s stock acquisition date, that business combination or the purchase of stock made by the interested stockholder on that stock acquisition date. “Business Combination” is defined in § 180.726(l)(e) and includes various forms of self-dealing between an interested stockholder and the corporation. An “interested stockholder” of a resident domestic corporation is a person other than the resident domestic corporation or a subsidiary of the resident domestic corporation who is a) “the beneficial owner of at least 10% of the voting power of the outstanding voting stock of the resident domestic corporation,” or b) “an affiliate or associate of that resident domestic corporation and at any time within 3 years immediately before the date in question was the beneficial owner of at least 10% of the then outstanding voting stock of that resident domestic corporation.” Wis.Stat. § 180.726(l)(j)l. “‘Stock acquisition date’, with respect to any person, means the date that that person first becomes an interested stockholder of that resident domestic corporation.” Wis.Stat. § 180.726(l)(n). The Act is set forth, in full, in Appendix A to this opinion. Particular provisions will be referenced where helpful. A. The Williams Act Challenge Amanda contends that the Williams Act preempts the Wisconsin act, making the latter violate the supremacy clause. The Supreme Court’s decisions on preemption leave no doubt that “absent an explicit indication by Congress of an intent to preempt state law, a state statute is preempted only” where complying with both federal and state regulations is physically impossible, or where the state law is an obstacle to accomplishing and executing Congress’ full purposes and objectives. C.T.S. Corp. v. Dynamics Corp. of America, 481 U.S. 69, 107 S.Ct. 1637, 1644, 95 L.Ed.2d 67 (1987) (citations omitted) rev’g Dynamics Corp. of America v. C.T.S. Corp., 637 F.Supp. 389 (N.D.Ill.1986), aff'd, 794 F.2d 250 (7th Cir.). Entities can comply with both the Williams Act and the Wisconsin act. Therefore, the Wisconsin act can be preempted only if it frustrates the Williams Act’s purposes. In making both their Williams Act and commerce clause arguments, the parties in this case chiefly rely on CTS, 107 S.Ct. 1637, 95 L.Ed.2d 67 (1987), and Edgar v. MITE Corp., 457 U.S. 624, 102 S.Ct. 2629, 73 L.Ed.2d 269 (1982), aff'g MITE Corp. v. Dixon, 633 F.2d 486 (7th Cir.1980). In MITE, a divided Court struck down on commerce clause grounds an Illinois statute that provided for a twenty-day precommencement period, during which time management could disseminate its views on an upcoming tender offer but offerors could not publish their offer. The statute also provided that the fairness of tender offers would be reviewed by the Illinois secretary of state. A three member plurality found the statute preempted by the Williams Act. In CTS, the Court upheld an Indiana statute requiring a majority vote of disinterested shareholders before an entity acquiring controlling shares is entitled to voting rights. The acquiror can require management to hold a shareholder vote within fifty days if the acquiror files the appropriate statement, requests a special meeting and agrees to pay the expenses of the meeting. The Seventh Circuit Court of Appeals found the statute preempted under the Williams Act based on the view that the law’s practical effect was to delay consummation of tender offers until fifty days after their commencement. CTS, 107 S.Ct. at 1647. Though both the Illinois and the Indiana statute are distinct from Wisconsin’s act, the Court’s reasoning is instructional to the present case. The Williams Act governs disclosure and procedure with respect to tender offers. See generally CTS, 107 S.Ct. at 1644 (summarizing structure and purposes of Williams Act). In MITE, 457 U.S. 624, 102 S.Ct. 2629, 73 L.Ed.2d 269 (1982), as interpreted by the CTS Court, the three-member plurality “concluded that the Williams Act struck a careful balance between the interests of offerors and target companies, and that any state statute that ‘upset’ this balance was preempted.” CTS, 107 S.Ct. at 1645 (citing Edgar v. MITE Corp., 457 U.S. at 632-634,102 S.Ct. at 2635-36). The CTS Court found its holding to fall within the scope of the MITE plurality’s analysis, but effectively cast doubt on that analysis in not expressly adopting the plurality’s reasoning: As the plurality opinion in MITE did not represent the views of a majority of the Court, we are not bound by its reasoning. We need not question that reasoning, however, because we believe the Indiana act passes muster even under the broad interpretation of the Williams Act articulated by Justice WHITE in MITE. CTS, 107 S.Ct. at 1645. This court need not question the correctness of Justice White in MITE, if the present case is governed by the reasoning applied in CTS. But a discussion of the Williams Act’s purposes is illuminating, particularly given the limited precedential value of the MITE plurality’s reasoning. Carefully considering the Williams Act’s legislative history in Piper v. Chris-Craft Industries, 430 U.S. 1, 97 S.Ct. 926, 51 L.Ed.2d 124 (1977), reh’g denied, Bangor Punta Corp. v. Chris-Craft Industries, Inc., 430 U.S. 976, 97 S.Ct. 1668, 52 L.Ed.2d 371, the Supreme Court concluded “that the sole purpose of the Williams Act was the protection of investors who are confronted with a tender offer.” Id. at 35, 97 S.Ct. at 946. The Court recognized that Congress was indeed committed to a policy of neutrality in contests for control, but its policy of even-handedness does not go either to the purpose of the legislation or to whether a private cause of action is implicit in the statute. Neutrality is, rather, but one characteristic of legislation directed toward a different purpose — the protection of investors. Indeed, the statements concerning the need for Congress to maintain a neutral posture in takeover attempts are contained in the section of the Senate Report entitled “Protection of Investors.” Taken in their totality, these statements confirm that what Congress had in mind was the protection of shareholders, the “pawn[s] in a form of industrial warfare.” The Senate Report expressed the purpose as “placpng] investors on an equal footing with the takeover bidder,” Senate Report 4, without favoring either the tender offeror or existing management. >}: # # s¡¡ * sfc The sponsors of this legislation were plainly sensitive to the suggestion that the measure would favor one side or the other in control contests; however, they made it clear that the legislation was designed solely to get needed information to the investor, the constant focal point of the committee hearings. Id. at 29-31, 97 S.Ct. at 943-44. As this passage reflects, any balance of power between bidder and management afforded by the Williams Act is incidental to the legislation’s “sole purpose”: providing information to shareholders. The Williams Act’s policy-neutrality as to bidder and management is properly described as a characteristic rather than a purpose of the statute. The Williams Act responded to takeover bidders who operated covertly to the detriment of shareholders, see S.Rep. No. 550, 90th Cong., 1st Sess., 2 (1967); Piper, 430 U.S. at 28, 97 S.Ct. at 942, and is concerned with neutrality between bidder and management insofar as this neutrality protects shareholders’ access to necessary information. Any other balance of power between bidder and management must arise from outside this federal law. The MITE plurality’s preemption analysis, as ostensibly applied by the CTS Court, was summarized in BNS Inc. v. Koppers Co., Inc., 683 F.Supp. 458, 469 (D.Del.1988): First, does the statute protect independent shareholders from coercion? Second, does the statute give either management or the offeror an advantage in communicating with stockholders? This question may be reformulated to fit the circumstances of the present case by phrasing as whether the statute gives either management or the offeror an advantage in consummating or defeating an offer. Third, does the statute impose an indefinite or unreasonable delay on offers? And fourth, does the statute allow the state government to interpose its views of fairness between willing buyers and sellers? The latter two questions are of little assistance in the present case. The state does not interpose its views of fairness by virtue of having passed the Act, which itself expresses no view of transactions or invokes the state’s power to intercede in a transaction. Any questions of fairness are appropriately considered in terms of management’s relative power under the Act. Further, the Act by its terms does not directly impede a tender offer in any respect. It does not address disclosure requirements or prevent a tender offer from going forward. Rather, the statute affects business combinations following a successful tender offer. The fundamental question implicated by the Williams Act analysis in CTS and MITE is whether the Wisconsin act impairs shareholder autonomy, providing management with an undue advantage that could hinder the shareholders’ exercise of an informed choice concerning the tender offer. It appears undisputed that the Act was intended to deter hostile tender offers for Wisconsin corporations; and it is reasonably likely that the statute will have this effect. But the extent of this effect is speculative, and nothing about the Act prohibits any entity from purchasing or offering to purchase shares in Wisconsin corporations, or from attempting thereby to gain control. Cf. CTS, 107 S.Ct. at 1652. Considering Indiana’s anti-takeover law, the Court stated: Of course, by regulating tender offers, the act makes them more expensive and thus deters them somewhat, but this type of reasonable regulation does not alter the balance between management and offeror in any significant way. The principle result of, the act is____fully in accord with the purposes of the Williams Act. Id. at 1646 n. 7. The “balance” properly required here is that of the power to communicate concerning tender offers. Though the CTS Court found no need to step beyond the MITE plurality’s reasoning, the clear light of Piper leaves MITE very much in the shadows on this point. To the extent the MITE plurality requires a balance of strategic power between bidder and management, the nature of the deterrence is relevant. The Act bans second-step mergers for three years following the interested stockholder’s stock acquisition date, absent prior approval by the board of directors. After three years, a business combination may take place if: a) the prior board approval existed; b) the business combination is approved by the affirmative vote of the holders of a majority of the voting stock not beneficially owned by the interested stockholder at a meeting called for that purpose; or c) if certain stock price conditions are met. Wis.Stat. § 180.726(3). The Act does not ban takeovers per se, but merely delays for three years the successful bidder’s ability to attain complete control over the corporation. A delay of the free exercise of power is not unconstitutional, for “the Williams Act would preempt a variety of state corporate laws of hitherto unquestioned validity if it were construed to preempt any state statute that may limit or delay the free exercise of power after a successful tender offer.” CTS, 107 S.Ct. at 1647. For example, staggered terms for directors and cumulative voting provisions, allowed in most states, may delay the time when a successful bidder gains control over corporate affairs. Id. at 1647-48. “The long-standing prevalence of state regulation in this area suggests that, if Congress had intended to preempt all state laws that delay the acquisition of voting control following a tender offer, it would have said so explicitly.” Id. at 1648. The delay protects shareholders by discouraging unapproved freezeouts, or second-step mergers whereby remaining shareholders are forced to sell their stock for cash or securities. Tender offers contemplating freezeouts may be particularly coercive. The Supreme Court has recognized that protecting shareholders against the possibility of coercion in tender offers is a legitimate state concern. Id. at 1651. Further, to find the three year delay unconstitutional would be to implicitly adopt an economic policy favoring tender offers as inherently good. The fundamental reason for the Williams Act’s neutrality concerning management and bidder reflects a comprehensive view of tender offers: It was strongly urged during the hearings that takeover bids should not be discouraged because they serve a useful purpose in providing a check on entrenched but inefficient management. It was also recognized that these bids are made for many other reasons, and do not always reflect a desire to improve the management of the company. S.Rep. No. 550, 90th Cong., 1st Sess. at 3. The Wisconsin act effectively eliminates hostile leveraged buyouts, in which the assets of the target company provide resources for servicing the debt incurred by the bidder in taking control. To the extent hostile offers of this nature might be deterred, shareholders may not be offered the opportunity to take advantage of the escalating stock prices likely to accompany the speculation often attending tender offers. But the state, through its legislation, may favor long-term growth and capital investment over short-term speculation. Reflecting to some extent the 1967 Senate Report quoted above, the Supreme Court has recently given voice to the flux of economic theory enmeshing theoretical discussion of tender offers: No one doubts that some successful tender offers will provide more effective management or other benefits such as needed diversification. But there is no reason to assume that the type of conglomerate corporation that may result from repetitive takeovers necessarily will result in more effective management or otherwise be beneficial to shareholders. The divergent views in the literature— and even now being debated in the Congress — reflect the reality that the type and utility of tender offers vary widely. Of course, in many situations the offer to shareholders is simply a cash price substantially higher than the market price prior to the offer. CTS 107 S.Ct. at 1651 n. 13. Absent clear legislative directive, it is inappropriate for this court to posit all the world as Wall Street, where all the shareholders would be arbitrageurs. “The Constitution does not require the States to subscribe to any particular economic theory. [The courts] are not inclined ‘to second-guess the empirical judgments of lawmakers concerning the utility of legislation,’ Kassel v. Consolidated Freightways Corp., 450 U.S. at 679, 101 S.Ct. at 1321 (Brennan, J., concurring in judgment).” CTS, 107 S.Ct. at 1651. Individual shareholders remain free to invest their money in corporations domiciled in legislative environments more conducive to speculation. If they feel hindered in this regard because they believe their shares are undervalued, they should perhaps be mindful that any stock investment bears a number of inherent risks, including the possibility that a tender offeror may never appear and bully market prices momentarily skyward. The Act can not reasonably be said to impair shareholder decision-making in the tender offer process. The Act neither affects disclosure or timing, nor forbids tender offers themselves. The Act does provide shareholder protection in an area of legitimate state concern. Assuming the Act prevents potential bidders from ever making some tender offers, the impact of this deterrence presently appears incalculable and irrelevant. What might be of consequence is the extent to which bidders fail to receive board approval. However, a target attractive to one suitor will generally be attractive to others. Shareholders who feel the board is responding inappropriately to bidders maintain their power to effect changes in corporate control, thereby enhancing receptivity to offers. If management, for its part, were to take actions designed to diminish the value of the corporation’s shares [to fend off suitors], it may incur liability under state law. But this problem does not control our preemption analysis. Neither the [Williams] act nor any other federal statute can assure that shareholders do not suffer from the mismanagement of corporate officers and directors. Id. at 1647. In view of the shareholders’ presumed influence over management, the three year delay is not logically distinguishable from other delays or inhibitions of takeovers, such as staggered terms for directors and supermajority merger vote requirements, currently permitted in many states, notwithstanding that the latter limitations often may be more directly controlled by shareholders. The Act prevents business combinations for three years, but does not hinder the successful offeror’s exercise of any other attributes of control. Nothing in the Act prevents a potential bidder from seeking board approval in the first place. Nor does anything prevent an offeror from making a tender offer conditioned on board approval, whereby the suitor can effectively communicate its message to shareholders and enhance shareholder awareness. “A person is not the direct or indirect beneficial owner of stock tendered pursuant to a tender or exchange offer ... until the tendered stock is accepted for purchases or exchange.” Wis.Stat. § 180.726(l)(d)(2). Based on its reading of Supreme Court case law, the court in BNS v. Koppers Co., Inc., 683 F.Supp. at 469 (D.Del.1988), indicated that, notwithstanding a statute’s “substantial alteration of the balance between management and the offeror____ even statutes with substantial deterrent effects on tender offers do not circumvent Williams Act goals, so long as hostile offers which are beneficial to target shareholders have a meaningful opportunity for success.” But the Supreme Court does not appear to have formulated a “meaningful opportunity” test. Indeed, such a test would raise perplexing problems of determining which hostile offers are “beneficial to shareholders,” measuring “substantial deterrence,” and defining “meaningful opportunity for success.” And, of course, not all initially “hostile” offers remain hostile: many will inevitably result in negotiated transactions between the offeror and the target. The BNS court itself evidently found “meaningful opportunity” to exist, despite its conclusion that opportunities left open by the statute were heavily weighted against the offeror. Id. at 470-72. The same court subsequently found meaningful opportunity to exist based on statistical analysis in RP Acquisition Corp. v. Staley Continental, Inc., 686 F.Supp. 476 (D.Del.1988), but similar arguments made to this court were less than convincing on either side, particularly given the controversy surrounding these matters in the academic community and legislatures. Cf. West Point-Pepperell, Inc. v. Farley Inc. and Trust Co. Bank, 711 F.Supp. 1096 (N.D.Ga.1989) (noting difficulty of accurately applying “hostile/hostile” and other labels, as well as inadequacy of available data to show lack of meaningful opportunity). Ultimately, meaningful opportunity for success under the Wisconsin act can be controlled by shareholder vote in the light of board response to potential suitors. The board of directors itself, it should be remembered, remains subject to scrutiny under fiduciary standards for decisions made on behalf of the corporation. Universal contends that even if a meaningful opportunity for tender offer success is required, the Act offers it. A hostile offeror may wage a proxy contest, purchase a controlling interest, elect sympathetic board members, dictate corporate policies, or otherwise assume voting control. Amanda contends that the Act makes a proxy contest impracticable if not legally impossible. Without finding a clear legal or practical foundation for a “meaningful opportunity” requirement, I note that foreclosing a proxy contest opportunity could frustrate or even preclude shareholder autonomy and the exercise of informed choice. Under Wis.Stat. § 180.726(l)(j)(l)(a), an “interested stockholder” includes one who is