As stated in a follow up post on August 7th, 2008. Thank you NewEgg.com
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After consulting Newegg, I opened up the Intel E8400 box. As you can see in the pictures one side of the plastic was dented and one of the hold downs for the heat sink was a few millimeters from being bent. Other then a little smudge, the Intel chip was fine. Next I opened and installed the Intel BOXDG35EC motherboard. I found the cables box had shifted and smashed a few of the documents, nothing major, just annoying. 20 minutes later I had the remaining hardware installed and approximately 2 hours later the hard drive was reformatted (Western Digital 640GB, also purchased at Newegg.com) and windows was installed. From there on it was piece of cake.
Once again, thank you newegg.com
In the last photo (I believe) you can see the shipping labels and it is obvious that tape was added to at least the bottom of the package after the shipping label was attached. Not sure what to think of this. Any ways as far as I am concerned the issue is now resolved. The processor works great, my friend is happy and newegg is awesome. In the future I will do my best to bypass UPS (it is hard to pass up free 3 day shipping).
Thanks again for the comments and help.