EXHIBIT (a)(6)
[LETTERHEAD OF FORT JAMES CORPORATION APPEARS HERE]
October 16, 2000
TO HOLDERS OF FORT JAMES CORPORATION STOCK OPTIONS:
Fort James Corporation has agreed to be acquired by Georgia-Pacific
Corporation. Georgia-Pacific is making an exchange offer for the Fort James
shares, which will be followed by a merger to complete the acquisition. In the
offer and the merger, each share of Fort James common stock will be converted
into $29.60 in cash and a fraction of a share of Georgia-Pacific Group common
stock equal to .2644, subject to adjustment in certain circumstances.
Under the terms of our agreement with Georgia-Pacific, you have the
right to elect whether some or all of your options to acquire Fort James common
stock will be converted into options to acquire Georgia-Pacific Group common
stock or cash. This letter describes these two alternatives with respect to your
Fort James options. IF YOU FAIL TO MAKE AN ELECTION PRIOR TO 5:00 P.M., CENTRAL
TIME, ON NOVEMBER 2, 2000 (THE "ELECTION DEADLINE"), YOUR OPTIONS WILL
AUTOMATICALLY BE CASHED OUT WHEN GEORGIA-PACIFIC COMPLETES ITS OFFER FOR FORT
JAMES SHARES.
With respect to each of your option grants, you have the right to
elect between the following two alternatives:
- If you elect to receive Georgia-Pacific Group options, at the
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effective time of the merger, your Fort James options will be
converted into options to acquire Georgia-Pacific Group common
stock. We call these Georgia-Pacific Group options "Rollover
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Options" and describe them below under the heading "If You Elect to
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Rollover Your Fort James Options Into Options to Acquire
Georgia-Pacific Group Stock." Forms making this election must be
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received no later than November 2, 2000.
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- If you elect to receive cash or do not make an election by the
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election deadline, your options will be cashed out in connection
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with the offer. The amount of cash will be equal to the difference
between the "Per Share Amount" - which we describe in Appendix A to
this letter and depends on the price of the Georgia-Pacific Group
common stock - and the exercise price of your option. We describe
this alternative under "If You Elect to Cash Out Your Options or
Fail to Make an Election by the Election Deadline."
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October 16, 2000
Page 2 of 4
If you elect to receive Rollover Options, you will have a continuing
interest in the combined businesses of Georgia-Pacific and Fort James. The value
of your Rollover Options will increase or decrease depending on the stock price
of Georgia-Pacific Group common stock following the completion of the offer.
If you elect to cash out your options or fail to make an election by
the election deadline, once the offer is completed:
- you will no longer have the right to exercise your existing Fort
James options;
- the value of the cash you will receive in respect of your Fort James
options will be fixed and, upon receipt of such cash, your Fort
James options will automatically be cancelled and cease to exist;
and
- if the exercise price of your option exceeds the Per Share Amount,
you will receive no cash for that option and that option will
automatically be cancelled and cease to exist.
If you hold options which are currently exercisable you can, of
course, exercise those options and participate in the offer and the
merger. In no event, however, will you be able to exercise your options
after the completion of the merger and receive Fort James common stock.
THE DECISION AS TO WHETHER TO ELECT TO CONVERT YOUR FORT JAMES
OPTIONS INTO OPTIONS TO ACQUIRE GEORGIA-PACIFIC GROUP COMMON STOCK OR ELECT TO
CASH OUT YOUR OPTIONS IS A PERSONAL ONE AND WE URGE YOU TO DISCUSS YOUR
SITUATION WITH YOUR OWN TAX OR FINANCIAL ADVISERS.
IF YOU ELECT TO ROLLOVER YOUR FORT JAMES OPTIONS INTO OPTIONS TO ACQUIRE
GEORGIA-PACIFIC GROUP STOCK
If you elect to convert your Fort James options into options to
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acquire Georgia-Pacific Group common stock, you must return the attached
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election form by the election deadline. If you do so, at the time the merger is
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completed, each option will cease to represent a right to acquire shares of Fort
James common stock and will be converted automatically into a fully vested and
exercisable option to purchase shares of Georgia-Pacific Group common stock (a
"Rollover Option") in an amount and at an exercise price determined in the
following manner (and otherwise subject to the terms of the plan and the stock
option agreement under which it was granted):
- Number of Georgia-Pacific Group Common Shares: the number of shares
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of Georgia-Pacific Group common stock for which a Rollover Option
may be exercised will be equal to the product of (1) the number of
shares of Fort James common stock subject to the option immediately
prior to the effective time of the merger and (2) the quotient of
the Per Share Amount divided by the Georgia-Pacific Average Price,
rounded up to the nearest whole share; and
- Option Exercise Price: the exercise price per share of
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Georgia-Pacific Group common stock under a Rollover Option will be
equal to the quotient of (1) the exercise price per share of Fort
James common stock under the original option immediately prior to
the effective time of the merger divided by (2) the Per Share Amount
divided by the Georgia-Pacific Average Price, rounded down to the
nearest whole cent.
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October 16, 2000
Page 3 of 4
We define Per Share Amount and Georgia-Pacific Average Price on
Appendix A attached to this letter and include an example calculation in
Appendix B attached to this letter.
IF YOU ELECT TO CASH OUT YOUR OPTIONS OR FAIL TO MAKE AN ELECTION BY THE
ELECTION DEADLINE
If you elect to cash out your Fort James options or fail to make an
election by the election deadline, when the Georgia-Pacific exchange offer
expires, each such Fort James option will be cancelled automatically and you
will receive an amount in cash equal to the excess, if any, of the Per Share
Amount over the per share exercise price of such option, multiplied by the
number of shares of Fort James common stock subject to such option. Any cash
payment will be subject to any applicable tax withholding requirements.
ILLUSTRATIVE EXAMPLES
By way of example, if at a Georgia-Pacific Average Price of $30, you
have an option to purchase 1,000 shares of Fort James common stock at $25 per
share and you elect to roll over that option, you would receive an option to
purchase 1,250 shares of Georgia-Pacific Group common stock at $20.00 per share.
If, instead, you elect to cash out your option, you would receive $12,530 in
cash less applicable taxes. The detailed calculations for this are shown on
Appendix B attached to this letter.
If, at a Georgia-Pacific Average Price of $30, you have an option
for 1,000 shares of Fort James common stock, but your exercise price is $39 per
share, and you elect to roll over that option, you would receive an option to
purchase 1,250 shares of Georgia-Pacific Group common stock at $31.20 per share.
If, instead, you elect to cash out that option, you would receive $0 in cash and
the option will be automatically cancelled.
As shown in the last example, if you elect to cash out an option or
fail to make an election by the election deadline and the exercise price
applicable to that option exceeds the Per Share Amount, you will receive no
value for that option. AS A RESULT, HOLDERS OF OPTIONS WITH RESPECT TO WHICH THE
EXERCISE PRICE OF THE OPTION EXCEEDS THE PER SHARE AMOUNT (I.E., THE OPTIONS ARE
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OUT-OF-THE-MONEY) SHOULD ELECT TO CONVERT THOSE OPTIONS INTO OPTIONS TO RECEIVE
GEORGIA-PACIFIC GROUP COMMON STOCK.
You should also be aware that, in connection with the transaction,
the terms of your Fort James options were amended to provide for a minimum
period of time during which you may exercise your options if your employment is
terminated after the offer is completed. The amendment generally provides that
if your employment is terminated by your employer other than for "Cause" (as
defined in your stock option agreement) or by you for "Good Reason" under an
employment agreement (to the extent you have an agreement), in either case
during the three years following a Change of Control of Fort James, each of your
options may be exercised until the earlier of (1) three years following the
Change of Control and (2) the expiration of the original term of the option.
Former employees who have retired or terminated prior to a Change of Control of
Fort James will continue to be able to exercise options per the original terms
of the grant agreements.
<PAGE>
October 16, 2000
Page 4 of 4
PLEASE INDICATE ON THE ATTACHED SCHEDULE THE NUMBER OF OPTIONS WITH
RESPECT TO WHICH YOU ELECT TO RECEIVE OPTIONS TO RECEIVE GEORGIA-PACIFIC GROUP
COMMON STOCK AND THE NUMBER OF OPTIONS WITH RESPECT TO WHICH YOU ELECT TO
RECEIVE CASH AND RETURN OR FAX ONE SIGNED COPY OF THIS LETTER BY NOVEMBER 2,
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2000 TO BECKY RODGERS AT FORT JAMES CORPORATION, 1650 LAKE COOK ROAD, DEERFIELD,
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ILLINOIS 60015 (OR IF BY FAX TO (847) 317-5191). IF YOU DO NOT SEND IN AN
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ELECTION FORM BY THE ELECTION DEADLINE, ALL OF YOUR OPTIONS WILL BE CASHED OUT
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AND AUTOMATICALLY CANCELLED IN THE MANNER DESCRIBED UNDER "IF YOU ELECT TO CASH
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OUT YOUR OPTIONS OR FAIL TO MAKE AN ELECTION BY THE ELECTION DEADLINE." IF YOU
BELIEVE THAT ANY INFORMATION ON THE ELECTION FORM RELATING TO YOUR FORT JAMES
OPTIONS IS INCORRECT OR HAVE ANY QUESTIONS, PLEASE DO NOT HESITATE TO CALL BECKY
RODGERS AT (847) 317-5371 OR MICHAEL KATZFEY AT (847) 317-5215.
Sincerely,
/s/ Daniel J. Girvan
Daniel J. Girvan
Attachments
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FORT JAMES STOCK OPTION
ELECTION FORM *
NAME:
SSN:
ADDRESS:
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ELECT TO CONVERT ELECT TO
GRANT # OF OPTION TO GEORGIA-PACIFIC CASH OUT
DATE OPTION PRICE OPTIONS (SPECIFY NUMBER)
SHARES (SPECIFY NUMBER)
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* The information shown is as of October 5, 2000. To the extent an option is
exercised, expires or is otherwise cancelled after this date, any election
made with respect to such option will not apply.
Signature:_______________________________ Date:________________________________
NOTE: IF YOU FAIL TO MAKE AN ELECTION PRIOR TO 5:00 P.M., CENTRAL TIME, ON
NOVEMBER 2, 2000 (THE "ELECTION DEADLINE"), YOUR OPTIONS WILL AUTOMATICALLY BE
CASHED OUT WHEN GEORGIA-PACIFIC COMPLETES ITS OFFER FOR FORT JAMES SHARES.
RETURN OR FAX TO BECKY RODGERS AT FORT JAMES CORPORATION, 1650 LAKE COOK ROAD,
DEERFIELD, ILLINOIS 60015 (OR IF BY FAX TO (847) 317-5191).
<PAGE>
APPENDIX A
DEFINITIONS
Per Share Amount: The Per Share Amount is equal to the sum of (1)
$29.60 and (2) the product of the Exchange Ratio
and the Georgia-Pacific Average Price. For
example:
- if the Georgia-Pacific Average Price were
$30.00, the Per Share Amount would be $37.53
($29.60 plus the product of the Exchange
Ratio (.2644) and the Georgia-Pacific Average
Price ($30.00)); and
- if the Georgia-Pacific Average Price were
$40.00, the Per Share Amount would be $40.00
($29.60 plus the product of the Exchange
Ratio (.2600) and the Georgia-Pacific Average
Price ($40.00)).
Exchange Ratio: The Exchange Ratio is .2644. If, however, the
value of the Georgia-Pacific Group stock to be
received by Fort James stockholders in the offer
would exceed $10.40, which would occur when the
Georgia-Pacific Average Price is greater than
$39.33, the Exchange Ratio will be adjusted to
equal $10.40 divided by the Georgia-Pacific
Average Price. For example, if the
Georgia-Pacific Average Price was $40.00, the
Exchange Ratio would be .2600.
Georgia-Pacific Average The average (rounded to the nearest 1/10,000) of
Price: the volume weighted averages (rounded to the
nearest 1/10,000) of the trading prices of
Georgia-Pacific Group common stock on the New York
Stock Exchange for the ten consecutive trading days
ending on the third trading day before the date
that Georgia-Pacific accepts shares that have been
tendered in the offer. If the offer expires as
scheduled on November 9, 2000, the ten trading day
period would begin on October 24, 2000 and end on
November 6, 2000.
The following table shows the Exchange Ratio and the Per Share Amount at various
Georgia-Pacific Average Prices:
GEORGIA-PACIFIC EXCHANGE PER SHARE
AVERAGE PRICE RATIO AMOUNT
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$20.00........................ .2644 $34.89
25.00........................ .2644 36.21
30.00........................ .2644 37.53
35.00........................ .2644 38.85
40.00........................ .2600 40.00
45.00........................ .2311 40.00
<PAGE>
APPENDIX B
The following example illustrates how to calculate the number of Rollover
Options or amount of cash you would receive in respect of your Fort James
options.
Assume the following:
Georgia-Pacific Average Price: $30.00
Per Share Amount: $37.53
# of Option Shares: 1,000
Per Share Exercise Price: $25.00
IF YOU ELECT TO ROLL OVER THE OPTIONS, YOU WOULD RECEIVE:
# of Rollover Options: 1,250
New Exercise Price: $20.00
The calculations are as follows:
# of Rollover Options = # of Option Shares x Per Share Amount
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Georgia-Pacific
Average Price
1,000 x $37.53 = 1,250
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$30.00
New Exercise Price = Per Share Exercise Price
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Per Share Amount / Georgia-Pacific Average Price
$25.00 = $20.00
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$37.53 / $30.00
IF YOU ELECT TO CASH OUT THE OPTION OR FAIL TO MAKE AN ELECTION BY THE
ELECTION DEADLINE, YOU WOULD RECEIVE:
Amount of Cash: $12,530 less applicable taxes
The calculation is as follows:
Amount of Cash = (Per Share Amount - Per Share Exercise Price) x # of
Option
Shares
($37.53 - $25.00) x 1,000 = $12,530
