DEERFIELD, Ill., Feb. 19 /PRNewswire/ -- Fort James Corporation today
announced it has adopted a new share purchase rights plan to replace the
current plan expiring March 1, 1999. The replacement plan involves the
distribution of one purchase right for a series preferred stock for each
outstanding share of the company's common stock as of a March 1, 1999 record
date.
Similar to the existing rights plan, the new plan is designed to protect
shareholders from unsolicited takeover attempts that may unfairly pressure
shareholders and deprive them of the full value of their shares and to help
maximize the value of shareholders' long-term investment in Fort James. The
rights plan guards against partial tender offers, squeeze-outs, open market
accumulations and other abusive tactics to gain control of the company without
paying all shareholders a full and fair premium value for their shares.
The rights are not being distributed in response to any effort to acquire
the company and the board is not aware of any such effort. While the rights
plan will not prevent a takeover, if at any point in the future another party
became interested in such an effort, the plan would encourage it to negotiate
with Fort James' board of directors prior to attempting a takeover.
The rights plan allows holders of rights to purchase shares in either Fort
James or an acquiring party at discounts from market value, in certain
circumstances. The plan has three basic provisions.
First, if an acquiror buys 15 percent or more of Fort James' stock, the
plan allows other shareholders to buy, with each right, additional Fort James
shares at a 50 percent discount. Second, if Fort James is acquired in a
merger or other business combination transaction, rights holders other than
the acquiror will be entitled to buy shares of the acquiring company at a 50
percent discount. Third, before an acquiror buys 15 percent or more of Fort
James' common stock, the board of directors has the option to redeem the
rights for one cent per right. The board of directors may also reduce these
15 percent thresholds to not less than 10 percent.
The new rights plan will become effective on March 1, 1999, and will
expire on March 1, 2009. The rights distribution is not taxable to
shareholders.
Fort James is a leading international consumer products company, serving
consumers both at home and away-from-home with bathroom and facial tissue,
paper towels, napkins, and cups and plates. The company's popular brands
include Quilted Northern, Brawny, Dixie, Vanity Fair, Mardi Gras, Green
Forest, Soft 'N Gentle and So-Dri in North America and Lotus, Tenderly,
Colhogar and Kittensoft in Europe. Fort James also produces folding cartons
for packaging food and pharmaceuticals and communications papers such as
printing, publishing and office copy paper. The company has annual sales of
$7.3 billion, approximately 27,500 employees and more than 60 manufacturing
facilities in the U.S., Canada and 15 countries around the world.
SOURCE Fort James Corporation
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Related links:
http://www.fortjames.com
CONTACT:
Financial, Celeste Gunter, 804-662-8307, or
Media, Mark Lindley, 847-317-5280, both of Fort James Corporation
NOTE TO EDITORS: Copies of today's news release, along with
additional information on Fort James, are available, at no
charge, by calling 888-526-3711. You may also access the
company's web site at Internet address http://www.fortjames.com
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