RICHMOND, Va., March 11 /PRNewswire/ -- Fort James Corporation
(NYSE: FJ) today announced that it has called for redemption all of the
outstanding shares of its Series K $3.375 Cumulative Convertible Exchangeable
Preferred Stock (the "Series K"), its Series L $14.00 Cumulative Convertible
Exchangeable Preferred Stock (the "Series L") and its Series N $14.00
Cumulative Convertible Exchangeable Preferred Stock (the "Series N")
(collectively, the "Preferred Stock"). All of the outstanding shares of the
Preferred Stock will be redeemed on April 10, 1998.
Series K Preferred Stock
Fort James will pay the sum of $50.00, plus $.64688, representing accrued
and unpaid dividends from February 1, 1998, to the redemption date, on each
share of Series K stock, for a total payment of $50.64688 per share. As an
alternative to redemption and at the option of the holder, the Series K shares
are convertible until 5:00 p.m. (Eastern Time) on April 10, 1998, into Fort
James' common shares at a conversion rate equal to 1.3376 Fort James common
shares for each Series K share. As long as the price of Fort James common
shares remains above $37.86 per share, holders of the Series K shares will
receive more value upon conversion of the Series K shares into common shares
than they would otherwise receive upon redemption (without giving effect to
commissions and other costs of sale).
Series L and Series N Preferred Stock
The Series L and Series N preferred stock is held in the form of
depositary shares, with each depositary share representing a one-quarter
interest in a preferred share. Fort James will pay the sum of $50.00, plus
$.09722, representing accrued and unpaid dividends from April 1, 1998, to the
redemption date, on each depositary share of Series L and Series N stock, for
a total payment of $50.09722 per depositary share. As an alternative to
redemption and at the option of the holder, the Series L and Series N shares
are convertible until 5:00 p.m. (Eastern Time) on April 10, 1998, into Fort
James' common shares at a conversion rate equal to 1.3626 Fort James common
shares for each Series L or Series N depositary share. As long as the price
of Fort James common shares remains above $36.77 per share, holders of the
Series L and Series N depositary shares will receive more value upon
conversion of the Series L and Series N depositary shares into common shares
than they would otherwise receive upon redemption (without giving effect to
commissions and other costs of sale).
Dividends
No dividends for the period commencing February 1, 1998, for the Series K
stock and April 1, 1998, for the Series L and Series N stock, will be paid on
the Preferred Stock converted into common stock. Holders of Preferred Stock
converting their shares into common stock before 5:00 p.m. (Eastern Time) on
March 17, 1998, will be eligible for the quarterly dividend on common stock of
$.15 per share, payable on March 31, 1998, to shareholders of record on March
17, 1998. Holders of record of Series L and Series N stock as of March 18,
1998, converting their shares into common stock prior to April 1, 1998, will
forfeit the quarterly preferred dividend of $.875 per depositary share payable
on that date. All shares of the Preferred Stock not surrendered for
conversion prior to 5:00 p.m. (Eastern Time) on April 10, 1998, will be
redeemed at the applicable redemption price.
Standby Agreement, Redemption and Conversion Agent and Recent Stock Prices
Fort James has entered into a standby agreement with Salomon Smith Barney
pursuant to which, subject to certain conditions, Salomon Smith Barney will
purchase from Fort James that number of shares of common stock that would have
been issuable upon conversion of shares of the Preferred Stock that are not
converted.
Norwest Bank Minnesota, N.A., the redemption and conversion agent, will
today mail a Notice of Redemption and related materials to all registered
holders of the Preferred Stock. Shareholders with questions should contact
Norwest Bank at 800-380-1372 or the company at 888-649-4362.
As reported on the New York Stock Exchange Composite Tape on March 10,
1998, the per share closing price of the Fort James common stock was $46.1875,
the Series K stock was $62.00 and the Series L depositary stock was $63.50.
The Series N stock is not listed on the New York Stock Exchange. On March 10,
1998, Fort James had outstanding an aggregate of 219.9 million common shares,
including 9.6 million common shares issuable on the assumed conversion of all
the Preferred Stock.
Fort James anticipates that the conversion or redemption of the Preferred
Stock will result in cash flow savings and will simplify the company's capital
structure.
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. With annual sales of $7.3
billion, the company has approximately 29,000 employees and more than 65
manufacturing facilities in the U.S., Canada and 10 European countries.
You may also access the company's Web site at Internet address
http://www.fortjames.com.
SOURCE Fort James Corporation
 back to top
Related links:
http://www.fortjames.com
CONTACT:
Financial, Celeste Gunter, 804-649-4307 or
Media, Richard B. Elder, 804-343-4785, both of Fort James
|
