SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box: | ||||
[_] | Preliminary Proxy Statement | |||
[_] | CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY RULE 14A-6(E)(2)) |
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[X] | Definitive Proxy Statement | |||
[_] | Definitive Additional Materials | |||
[_] | Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12 | |||
Georgia Pacific Corporation | ||||
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(Name of Registrant as Specified In Its Charter) | ||||
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant) | ||||
Payment of Filing Fee (Check the appropriate box): | ||||
[X] | No fee required | |||
[_] | Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. | |||
(1) | Title of each class of securities to which transaction applies: | |||
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(2) | Aggregate number of securities to which transaction applies: | |||
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(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined): | |||
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(4) | Proposed maximum aggregate value of transaction: | |||
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[_] | Fee paid previously with preliminary materials. | |||
[_] | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | |||
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(4) | Date Filed: | |||
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Dear Fellow Shareholder:
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Please come to the
Georgia-Pacific Corporation Annual Meeting of Shareholders at 11:00 a.m. on Tuesday, May 1, 2001, to hear about the major events at your company in 2000. The Annual Meeting will be held at the Radisson Riverfront Hotel, 2 Tenth Street, in Augusta,
Georgia.
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During the last year, we made
important progress toward achieving our strategic objectives and we look forward to reporting to you on these and other important matters. In addition, we will vote on the matters set forth in the attached Notice of Annual Meeting and Proxy
Statement.
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We have again provided to you
the option of voting by mail, telephone or the Internet. Your vote is important. Even if you plan to attend the meeting, please vote as soon as possible.
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Sincerely,
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A. D. Correll
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Chairman, Chief Executive Officer and
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President of Georgia-Pacific Corporation
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TIME
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11:00 a.m. EDT on Tuesday, May 1, 2001
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BUSINESS
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(1)
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Elect 6 members of the Board of Directors.
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(2)
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Reapprove our Economic Value Incentive Plan, as amended.
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DOCUMENTS
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The Proxy Statement, proxy card, and the Georgia-Pacific Annual Report on Form 10-K are included in this mailing. They are
first being mailed to shareholders on or about March 29, 2001.
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PLACE
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Radisson Riverfront Hotel
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2 Tenth Street
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Augusta, Georgia
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RECORD DATE
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Owners of shares of common stock of either Georgia-Pacific Group or The Timber Company at the close of business on March 7,
2001 may attend and vote at the meeting. Holders of shares of The Timber Company will not be entitled to vote if the proposed merger with Plum Creek Timber Company, Inc. is consummated before the time of the meeting.
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EXECUTIVE OFFICES
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Georgia-Pacific Corporation
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133 Peachtree Street, N.E.
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Atlanta, Georgia 30303-1847
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VOTING
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Even if you plan to attend the meeting in Augusta, please provide us with your voting instructions in one of the following
ways as soon as possible:
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(1)
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Internet use the Internet address on the proxy card
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(2)
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Telephone use the toll-free number on the proxy card
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(3)
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Mail mark, sign, and date the proxy card and return in the enclosed postage-paid envelope
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By order of the Board of Directors,
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Kenneth F. Khoury
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Vice President, Deputy General Counsel and Secretary
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Q:
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What am I voting on?
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A:
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There are 2 proposals scheduled to be voted on at the meeting:
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The election of directors; and
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Reapproval of our Economic Value Incentive Plan (as amended).
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Q:
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Who is entitled to vote?
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A:
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Shareholders of record as of the close of business on March 7, 2001. However, in the event that the merger of
The Timber Company and Plum Creek Timber Company, Inc., which was announced on July 17, 2000, occurs prior to the Annual Meeting, holders of The Timber Company common stock (The Timber Company Stock) will not be entitled to vote those
shares.
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Q:
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How many votes is each share entitled to?
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A:
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Each share of common stock of Georgia-Pacific Group (Georgia-Pacific Group Stock) is entitled to
one vote. Each share of The Timber Company Stock is entitled to 1.053 votes, based on the formula in our Amended and Restated Articles of Incorporation.
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Q:
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How do I vote?
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A:
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You may vote:
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by attending the Annual Meeting;
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online via the Internet at http://eproxyvote.com/gp;
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by telephone at 1-877-779-8683 (1-877-PRX-VOTE) as directed on your proxy card; or
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by completing and mailing your proxy card.
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Q:
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How many votes are needed to elect a director, reapprove our Economic Value Incentive Plan, or take other
action?
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A:
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If a quorum is present, a majority of the votes cast is required to approve all matters other than the election
of directors. When electing a director, the nominees shall be elected by a plurality of the votes cast, which means that the nominees receiving the most votes will be elected. Votes withheld from any nominee, if a quorum is present, will have no
effect on the outcome of voting for directors. Abstentions and votes that a broker fails to vote will not be counted and will have no effect on the outcome of such matters.
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Q:
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Who will count the votes?
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A:
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First Chicago Trust Company, a division of EquiServe, will tabulate the votes and act as inspector of
election.
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A:
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Yes. You may revoke your proxy by submitting a new proxy by one of the methods described in the previous
question and answer, or by sending a written request to change your vote that must be received by our Secretary prior to the meeting. Giving your proxy does not deprive you of your right to vote in person should you attend the Annual
Meeting.
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Q:
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How will voting on any other business be conducted?
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A:
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If any matter other than the election of directors or the reapproval of our Economic Value Incentive Plan is
properly raised and lawfully presented at the Annual Meeting, your vote gives authority to the persons named on the proxy card to vote on any such matter in their discretion.
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Q:
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How many votes does Georgia-Pacific need to hold the meeting?
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A:
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As of the record date, March 7, 2001, 225,691,337 shares of common stock of Georgia-Pacific Group were outstanding and 80,577,522 shares of common stock of The Timber Company were outstanding. The total number of possible votes is 310,539,467.7. A number of votes equal to or greater than a majority of the possible votes, or 155,269,734 (including abstentions) will constitute a quorum. No business may be transacted at the Annual Meeting without a quorum. If any of your shares are held by a broker who fails to vote them, then those shares will not |
1
be counted. If you are present at the meeting in person or by proxy, or vote by proxy card, telephone or online via the
Internet, you will be considered part of the quorum.
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Q:
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Is my vote confidential?
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A:
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Proxy cards, ballots and voting tabulations that identify individual shareholders are mailed or returned
directly to First Chicago Trust Company, and handled in a manner that protects your privacy. Your vote will not be disclosed except: (1) as needed to permit First Chicago Trust Company to tabulate and certify the vote; (2) as required by law; (3) if
we determine in good faith that a bona fide dispute exists as to the accuracy or authenticity of a proxy, ballot or vote; or (4) in the event of a proxy contest unless all parties to the contest agree to follow Georgia-Pacifics confidentiality
policy.
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Q:
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What does it mean if I get more than one proxy card?
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A:
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You may receive a proxy card for each account that you have, including shares held by a trustee in the dividend
reinvestment plan or any employee benefit plan. Please vote by proxy for all accounts to ensure that all your shares are voted. The proxy card (or cards) you receive represents all shares you are entitled to vote. For the first time, a proxy card
may combine the votes you are entitled to cast for any Georgia-Pacific Group Stock and Timber Company Stock you hold. If you wish to consolidate multiple accounts, please contact our transfer agent, First Chicago Trust Company, a Division of
EquiServe, at (800) 519-3111.
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Q:
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How will shares in Georgia-Pacific employee benefit plans be voted?
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A:
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Shares held in such plans that are entitled to vote will be voted pursuant to your instructions, except they
are voted by the trustee. Shares held in the Georgia-Pacific Group Stock Fund of the Fort James 401(k) Plan, all of which are entitled to vote, but for which votes are not cast, will be voted in proportion to shares in that Plan for which votes have
been cast. Shares held in any other plan that are entitled to vote and do not vote will not be voted. You must instruct the trustee to vote your shares by utilizing the voting methods described above: online, by telephone or by completing and
mailing your proxy card.
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Q:
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When are shareholder proposals for the year 2002 Annual Meeting due?
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A:
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The deadline for receipt of shareholder proposals intended to be included in the proxy statement or otherwise
for next years meeting is the close of business on November 29, 2001. They must be submitted in writing to Kenneth F. Khoury, Vice President, Deputy General Counsel and Secretary, Georgia-Pacific Corporation, 133 Peachtree Street, N.E.,
Atlanta, Georgia 30303.
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Q:
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Who are the proxy solicitors and what are the solicitation expenses?
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A:
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We have hired D.F. King & Co., Inc. to solicit proxies for $10,000, plus its costs to assist in the
distribution of proxy material and solicitation of votes by mail, telephone, facsimile or personal meetings. Our officers, directors and employees may also assist with solicitation efforts.
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We will reimburse brokers and other custodians, nominees and fiduciaries for forwarding proxy and solicitation materials to
owners of Georgia-Pacific Group Stock and The Timber Company Stock in accordance with the fee schedule approved by the New York Stock Exchange.
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Q:
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May I access this years proxy statement and annual report via the Internet?
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A:
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Yes. This proxy statement and our 2000 Annual Report on Form 10-K are available by accessing the Investor
Information section on our Internet site at http://www.gp.com. In addition, most shareholders can elect to receive future proxy statements, annual reports and proxy cards over the Internet instead of receiving paper copies in the mail. Links will be
provided to elect this option if you vote on the Internet in accordance with the instructions on your proxy card.
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2
WORLEY H. CLARK, JR., 68, President of W.H. Clark Associates, Ltd., (consulting firm), Chicago, Illinois since 1994, has been one of
our directors since November 27, 2000. Mr. Clark retired from Nalco Chemical in 1994, where he served as Chairman and Chief Executive Officer. Mr. Clark served as a director of Fort James Corporation from 1993 until the completion of our acquisition
of Fort James.
Mr. Clark is also a director of Merrill Lynch & Co., Inc., Bethlehem Steel Corporation, Ultramar Diamond Shamrock Corporation and Millennium Chemicals,
Inc.
CLASS II DIRECTOR NOMINEES, term ends May 4, 2004
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BARBARA L. BOWLES, 53, Chairman and Chief Executive Officer of Kenwood Group, Inc. (investment advisory firm), Chicago, Illinois since
1989, has been one of our directors since November 27, 2000. Ms. Bowles served as a director of Fort James from 1997 until the completion of our acquisition of Fort James.
Ms. Bowles is also a director of Black & Decker Corporation, Wisconsin Energy Corporation, Dollar General Corporation, The Chicago Urban League, and Childrens
Memorial Hospital of Chicago.
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DONALD V. FITES, 67, retired Chairman and Chief Executive Officer of Caterpillar Inc. (manufacturer of construction, mining and agricultural machinery
and engines), Peoria, Illinois, a position he held from 1990 until February 1, 1999. Mr. Fites has been one of our directors since 1992.
Mr. Fites is also a director of Caterpillar Inc., AT&T Corporation, ExxonMobil Corporation, AK Steel Corporation, Oshkosh Truck Corporation and Wolverine World
Wide, Inc.
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DAVID R. GOODE, 60, Chairman, President and Chief Executive Officer of Norfolk Southern Corporation (transportation holding company),
Norfolk, Virginia since September 1992, has been one of our directors since 1992.
Mr. Goode is also a director of Norfolk Southern Corporation, Caterpillar Inc., Delta Air Lines, Inc. and Texas Instruments Incorporated.
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JAMES B. WILLIAMS, 68, Chairman of the Executive Committee of SunTrust Banks, Inc. (bank holding company), Atlanta, Georgia since March 31, 1998, has
been one of our directors since 1989. Mr. Williams held the positions of Chairman and Chief Executive Officer of SunTrust Banks, Inc. from April 1991 and April 1990, respectively, until March 21, 1998.
Mr. Williams is also a director of SunTrust Banks, Inc., The Coca-Cola Company, Genuine Parts Company, Rollins, Inc., RPC Energy Services, Inc. and Marine Products
Corp.
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JOHN D. ZEGLIS, 53, Chief Executive Officer and Chairman, AT&T Wireless Group (wireless phone services company), Basking Ridge, New
Jersey since December 1999, and President since 1997. Mr. Zeglis served as Vice Chairman of AT&T (global communications company) from June to November of 1997, General Counsel and Senior Executive Vice President from 1996 to 1997 and Senior Vice
President and General Counsel from 1986 to 1996.
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4
JAMES S. BALLOUN, 62, Chairman, Chief Executive Officer and President of National Service Industries, Inc. (lighting equipment, chemicals,
textile rental and envelopes), Atlanta, Georgia since 1996, has been one of our directors since 1998. His current term as director ends in 2002. Mr. Balloun served as a director of McKinsey & Company, Inc. (management consulting) from 1976 until
assuming his present position.
Mr. Balloun is also a director of National Service Industries, Inc., Radiant Systems, Inc. and Wachovia Corporation.
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JANE EVANS, 56, President and Chief Executive Officer of GAMUT Interactive, Inc. (inter-active television/smart cards), Scottsdale,
Arizona since August 1995, has been one of our directors since 1994. Her current term as director ends in 2003. From April 1991 until March 1995, she was Vice President and General Manager of the Home and Personal Services Market Unit of US West
Communications, Inc. (telecommunications company), Denver, Colorado.
Ms. Evans is also a director of Kaufman & Broad Home Corp., Philip Morris Companies, Inc., PETsMART, Inc., Main St. & Main and Hypercom, Inc.
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ALSTON D. CORRELL, 59, our Chairman, Chief Executive Officer and President since December 1993, May 1993 and May 1996, respectively, has
been one of our directors since 1992. His current term as director ends in 2002.
Mr. Correll is also a director of Norfolk Southern Corporation, Mirant Corporation and SunTrust Banks, Inc.
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RICHARD V. GIORDANO, 66, Chairman of BG Group plc (purchaser, distributor and seller of gas and gas supported services), London, England
since January 1994, has been one of our directors since 1984. His current term as director ends in 2003. Mr. Giordano served as Chairman of The BOC Group plc (manufacturer of industrial gases and other products) from January 1994 until January
1996.
Mr. Giordano is also a director of Rio Tinto plc.
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5
M. DOUGLAS IVESTER, 53, Retired Chairman of the Board and Chief Executive Officer of The Coca-Cola Company (manufacture, marketing and
distribution of syrups and concentrates and nonalcoholic beverage products, and juice and juice drink products), Atlanta, Georgia. He served in that position from October 23, 1997 to February 17, 2000. He has been one of our directors since 1993.
His current term as director ends in 2003. Mr. Ivester served as President and Chief Operating Officer of The Coca-Cola Company from July 1994 to October 1997.
Mr. Ivester is also a director of SunTrust Banks, Inc.
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LOUIS W. SULLIVAN, M.D., 67, President of Morehouse School of Medicine, Atlanta, Georgia since January 1993, has been one of our directors
since 1993. His current term as director ends in 2003.
Dr. Sullivan served as Secretary of the United States Department of Health and Human Services from March 1989 until January 1993.
Dr. Sullivan is also a director of Bristol-Myers Squibb Company, CIGNA Corporation, Equifax Inc., Household International, Inc., and Minnesota Mining &
Manufacturing Company.
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JAMES P. KELLY, 57, Chairman and Chief Executive Officer of United Parcel Service, Inc. (UPS), (the worlds largest
package distribution company and logistics provider), Atlanta, Georgia since 1997. He has held various positions at UPS since 1965 including Vice-Chairman and Chief Operating Officer prior to assuming his current position. He has been one of our
directors since 1999. His current term as director ends in 2002.
Mr. Kelly is also a director of United Parcel Service, Inc. and BellSouth Corporation.
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6
Q:
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How are we managed?
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A:
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We are managed by a core group of officers and governed by a Board of Directors that currently is set at 15
members by the Bylaws. The Board of Directors is expected to reduce this number to 14 at its March 30, 2001 meeting and 13 at its May 1, 2001 meeting. Our Bylaws divide the Board into 3 classes of approximately equal size with each class being
elected for three years.
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Q:
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How does the Board of Directors operate?
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A:
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Our Board has adopted a set of policies and procedures that govern its composition and operation as well as
that of its committees.
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The Boards policies and procedures generally address the following:
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Qualifications and term of Directors
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Responsibilities and operations of committees
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Capital appropriations and operating plans
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Development, performance assessment and succession planning of management
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Annual Board self-assessment
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Q:
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What are the significant policies and procedures of the Board?
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A:
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A majority of our Directors and all of the members of our Directors on the Audit and Compensation Committees must come from outside of Georgia-Pacific
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A Director should offer to resign:
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in the event of prolonged ill-health, or
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after a change in principal employment
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Governance policies regarding our two classes of common stock include:
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Directors have a fiduciary duty to holders of both Georgia-Pacific Group Stock and The Timber Company Stock
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Directors will review:
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the business and operations of each of The Timber Company and Georgia-Pacific Group
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transactions and allocations between The Timber Company and Georgia-Pacific Group
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Directors should hold a substantially equal number of shares of Georgia-Pacific Group Stock and The Timber Company
Stock
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Q:
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What are non-employee directors paid each year?
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A:
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Each Directors compensation consists of:
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$40,000 in cash
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A restricted stock grant of substantially equal numbers of shares of Georgia-Pacific Group Stock and The Timber Company Stock
with an aggregate value of $40,000 on the date of grant
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Committee Chairmen receive a $5,000 annual fee
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Group term life insurance in the amount of $50,000
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The Directors have the option to defer all or part of the cash compensation payable to them provided that they defer at least
$10,000 in each calendar year. A deferral gives a Director the option of being paid as if such funds had been invested:
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in an equal number of shares of Georgia-Pacific Group Stock and The Timber Company Stock, or
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in a promissory note with a floating interest rate equal to 3
/4% over the six-month Treasury Bill
rate
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The deferred fees (adjusted for investment gains or losses) are paid upon retirement in a single payment or in annual cash
payments.
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Members are James S. Balloun, Robert Carswell (Chairman), Harvey C. Fruehauf, Jr., David R. Goode, James P. Kelly and Louis
W. Sullivan
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Met 5 times in 2000
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Reviews financial statements and periodic filings with the SEC and discusses them with management
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Reviews the scope and results of the audit of our financial statements by our independent accountants, including significant
changes in accounting principles and practices, significant proposed adjustments and disagreements with management, if any
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Reviews policies and meets with management to assess whether Georgia-Pacific is in material compliance with pertinent laws
and regulations
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Reviews controls to prevent and detect employee conflicts of interest, misconduct and fraud
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Reviews the scope and adequacy of internal controls and the results of certain examinations performed by the Internal Audit
Department
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Recommends independent accountants and reviews their services, independence and fees
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Consists of members who are independent, as defined by The New York Stock Exchange, Inc. listing standards
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Members are Worley H. Clark, Jr., Jane Evans, Donald V. Fites, Richard V. Giordano (Chairman), M. Douglas Ivester, and James
B. Williams
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Met 6 times in 2000
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Evaluates the annual performance of Georgia-Pacifics executive officers
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Determines officer salaries
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Administers compensation programs including:
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designing officer and other employee compensation plans
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making stock grants and awards to officers and other employees
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setting performance targets for officers and other employees
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Members are Alston D. Correll (Chairman), Donald V. Fites, Harvey C. Fruehauf, Jr., Richard V. Giordano, M. Douglas Ivester
and James B. Williams
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Did not meet in 2000
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Exercises the power of the full Board between meetings except for certain fundamental transactions and matters of corporate
governance
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Members are James S. Balloun, Barbara L. Bowles, Robert Carswell, David R. Goode, M. Douglas Ivester, and James B. Williams
(Chairman)
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Met 6 times in 2000
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Reviews financial plans and major financings
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Reviews management policies regarding borrowing, leasing, acquisitions, dispositions, and capital expenditures
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Recommends dividends
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Members are Jane Evans, Donald V. Fites (Chairman), Harvey C. Fruehauf, Jr., James P. Kelly, and Louis W.
Sullivan
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Met 7 times in 2000
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Reviews corporate governance issues including the composition, work, organization and compensation of the Board and its
committees
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Conducts an annual evaluation of the performance of the Board as a whole
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Considers and recommends nominees for election as directors but will accept and consider recommendations from shareholders
subject to the requirements below
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the name and address of record of the nominating shareholder;
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a representation that the shareholder is a record shareholder;
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a representation that the shareholder intends to appear in person or by proxy at the meeting to nominate the person specified
in the notice;
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the class and number of shares held of record, owned beneficially, represented by proxy, by the shareholder, and each
proposed nominee;
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the name, age, business and residential address, and principal occupation or employment of each proposed nominee;
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a description of all arrangements or understandings between the shareholder and each proposed nominee;
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any other information regarding each nominee that is required to be included in a proxy statement filed pursuant to the rules
of the Securities and Exchange Commission; and
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the written consent of each proposed nominee to serve as a director if so elected.
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9
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base salaries
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annual cash bonuses for achieving annual corporate and business unit goals
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long-term stock-based incentives consisting of stock options, performance rights and/or restricted stock
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n Threshold | 30th percentile | |
n Target | 54th percentile | |
n Maximum | 100th percentile |
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actual performance compared to targeted performance of business units, divisions or segments for the plan year
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actions taken by business units, divisions or segments to increase EVA in future years
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increase the maximum total bonus payable to a participant for a given year from $2,000,000 to $3,500,000
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eliminate The Timber Companys EVA from the EVIP calculation
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provide that the Compensation Committee annually shall select in advance our peer group companies for purposes of
calculations under EVIP from companies listed in the Standard & Poors Paper and Forest Products Industry Index and the Standard & Poors Household Products (nondurables) Index
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reflected changes related to the adoption of a broad level pay structure for certain business units
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Net Income performance targets
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Threshold $129 million
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Target $152 million
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Maximum $175 million
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Free cash flow performance targets
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Threshold $92 million
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Target $115 million
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Maximum $138 million
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12
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financial results at both Georgia-Pacific Group and The Timber Company, including
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total shareholder return of Georgia-Pacific Group for 1999-2000 that ranked at the 51st percentile of all companies in our
peer group
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EVA of Georgia-Pacific Group for 2000 that ranked at the 88th percentile of all companies in our peer group
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net income and free cash flow for 2000 that were at 196% and 200% of target level performance, respectively, at The Timber
Company
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the successful acquisition of Fort James Corporation
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efforts to redirect the focus of Georgia-Pacific away from commodity and into consumer/branded products
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aggressive leadership in areas of interest to Georgia-Pacifics diverse constituency
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building a strong management team
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maintaining a safe working environment
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environmental stewardship
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14
Annual Compensation |
Long-Term
Compensation Awards |
Payouts |
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Name and
Principal Position |
Year | Salary($) | Bonus
($)(1) |
Other Annual
Compensation ($)(2) |
Securities
Underlying G-P Group Options(#) |
Securities
Underlying TTC Options(#) |
LTIP
Payouts ($)(3) |
All Other
Compensation ($)(4) |
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Alston D. Correll | 2000 | 1,200,000 | 1,800,000 | 61,026 | 96,700 | 129,300 | -0- | 3,723 | |||||||||
Chairman, Chief Executive | 1999 | 1,050,000 | 2,100,000 | 611,437 | 155,400 | -0- | -0- | 6,723 | |||||||||
Officer and President | 1998 | 1,050,000 | 399,600 | 1,399,570 | 287,600 | -0- | -0- | 6,000 | |||||||||
Lee M. Thomas | 2000 | 510,000 | 475,000 | 26,915 | 42,100 | -0- | -0- | 10,722 | |||||||||
Executive Vice President | 1999 | 475,000 | 475,000 | 13,609 | 52,800 | -0- | -0- | 10,725 | |||||||||
Consumer Products | 1998 | 440,000 | 210,000 | 359,930 | 64,600 | -0- | -0- | 9,808 | |||||||||
Donald L. Glass | 2000 | 455,000 | 433,524 | 12,628 | -0- | 184,500 | 183,125 | 13,313 | |||||||||
Executive Vice President | 1999 | 435,000 | 406,725 | 3,026 | -0- | -0- | -0- | 10,224 | |||||||||
Timber and Chief Executive
Officer The Timber Company |
1998 | 420,000 | 420,000 | 406,759 | -0- | -0- | -0- | 9,415 | |||||||||
Ronald L. Paul | 2000 | 470,000 | 340,000 | 70,926 | 42,100 | -0- | -0- | 3,553 | |||||||||
Executive Vice President | 1999 | 435,000 | 435,000 | 21,510 | 52,800 | -0- | -0- | 6,553 | |||||||||
Wood Products and
Distribution |
1998 | 400,000 | 300,000 | 7,067 | 64,600 | -0- | -0- | 6,000 | |||||||||
James F. Kelley | 2000 | 430,000 | 350,600 | 22,325 | 22,500 | 30,100 | -0- | 3,299 | |||||||||
Executive Vice President | 1999 | 415,000 | 300,000 | 4,847 | 23,800 | -0- | -0- | 10,216 | |||||||||
and General Counsel | 1998 | 401,000 | 157,000 | 13,972 | 30,200 | -0- | -0- | 10,206 | |||||||||
(1)
|
Reflects bonuses paid under EVIP, described on page 11, except Mr. Glasss bonus, which was paid pursuant to the TTC
Bonus Plan, described on page 12.
|
(2)
|
Other annual compensation consists of annual compensation not properly categorized as salary or bonus. Other annual
compensation in 2000 for Mr. Correll includes accounting and tax preparation fees of $25,000. Other annual compensation for Mr. Paul includes personal use of aircraft of $67,033.
|
(3)
|
Payouts pursuant to The Timber Company LTIP are described on page 13.
|
(4)
|
Includes G-P contributions in 2000 to G-Ps Salaried 401(k) Plan and premiums for term life insurance
(TLI):
|
401(k) | TLI | ||||
---|---|---|---|---|---|
Mr. Correll | $ 0 | $3,390 | |||
Mr. Thomas | 7,000 | 3,390 | |||
Mr. Glass | 9,845 | 3,136 | |||
Mr. Paul | 0 | 3,220 | |||
Mr. Kelley | 0 | 2,966 | |||
15
Individual Grants |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of
Securities Underlying Options/ Granted(#)(1) |
Percent of
Total Options Granted to Employees in 2000(%)(2) |
Exercise
or Base Price ($/Sh) |
Expiration
Date |
Grant Date
Present Value($)(3)(4) |
||||||
Alston D. Correll | 96,700 | 4.01 | 41.59 | 1/20/10 | 2,085,819 | ||||||
Lee M. Thomas | 42,100 | 1.74 | 41.59 | 1/20/10 | 908,097 | ||||||
Donald L. Glass | -0- | -0- | -0- | -0- | -0- | ||||||
Ronald L. Paul | 42,100 | 1.74 | 41.59 | 1/20/10 | 908,097 | ||||||
James F. Kelley | 22,500 | .93 | 41.59 | 1/20/10 | 485,325 | ||||||
(1)
|
Grants were made on January 21, 2000 and vest annually over 3 years at rates of 34%, 33% and 33% on the anniversary date of
the grant. In the event of a change of control, these options become fully vested and are immediately exercisable for the remainder of their term.
|
(2)
|
A total of 2,412,955 stock options was granted in 2000.
|
(3)
|
Value was established by using the Black-Scholes Valuation Model. The actual value, if any, depends on the market value of
the underlying stock at a future date. Significant assumptions used for this calculation are shown below:
|
Volatility | Risk Free
Rate of Return |
Dividend
Yield |
Term | Discount for
Forfeiture Risk Before Vesting |
Discount for
Forfeiture Risk After Vesting and Prior to Option Expiration Date |
||||||
---|---|---|---|---|---|---|---|---|---|---|---|
42.39% | 6.66% | 1.20% | 10 Years | 7.75% | 12.86% | ||||||
(4)
|
These values are for illustrative purposes only.
|
Number of Securities
Underlying Unexercised Options at Fiscal Year- End(#) |
Value of Unexercised
In-The-Money Options($)(1) |
||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Shares
Acquired on Exercise(#) |
Value
Realized ($) |
Exercisable | Unexercisable | Exercisable | Unexercisable | |||||||
Alston D. Correll | | | 907,728 | 294,172 | 3,440,622 | 277,131 | |||||||
Lee M. Thomas | | | 175,034 | 98,266 | 631,380 | 62,249 | |||||||
Donald L. Glass | | | 50,200 | 0 | 236,191 | 0 | |||||||
Ronald L. Paul | | | 58,470 | 98,266 | 152,585 | 62,249 | |||||||
James F. Kelley | | | 75,058 | 48,174 | 243,886 | 29,101 | |||||||
(1)
|
Represents the amount by which the closing price on December 31, 2000 ($31.125) exceeded the exercise prices of unexercised
options.
|
16
Individual Grants |
||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of
Securities Underlying Options/ Granted(#)(1) |
Percent of
Total Options Granted to Employees in 2000(%)(2) |
Exercise
or Base Price ($/Sh) |
Expiration
Date |
Grant Date
Present Value($)(3)(4) |
|||||||
Alston D. Correll | 129,300 | 20.71 | % | 22.50 | 1/20/10 | 733,131 | ||||||
Lee M. Thomas | -0- | -0- | -0- | -0- | -0- | |||||||
Donald L. Glass | 184,500 | 29.56 | % | 22.50 | 1/20/10 | 1,046,115 | ||||||
Ronald L. Paul | -0- | | | | | |||||||
James F. Kelley | 30,100 | 4.82 | % | 22.50 | 1/20/10 | 170,667 | ||||||
(1)
|
Grants were made on January 21, 2000, and vest annually over 3 years at rates of 34%, 33% and 33% on the anniversary date of
the grant. In the event of a change of control, these options become fully vested and are immediately exercisable for the remainder of their term.
|
(2)
|
A total of 624,250 stock options was granted in 2000.
|
(3)
|
Value was established by using the Black-Scholes Valuation Model. The actual value, if any, depends on the market value of
the underlying stock at a future date. Significant assumptions used for this calculation are shown below:
|
Volatility | Risk Free
Rate of Return |
Dividend
Yield |
Term | Discount for
Forfeiture Risk Before Vesting |
Discount for
Forfeiture Risk After Vesting and Prior to Option Expiration Date |
||||||
---|---|---|---|---|---|---|---|---|---|---|---|
27.875% | 6.66% | 4.44% | 10 Years | 7.75% | 8.96% | ||||||
(4)
|
These values are for illustrative purposes only.
|
Name | Shares
Acquired on Exercise(#) |
Value
Realized ($) |
Number of Securities
Underlying Unexercised Options at Fiscal Year- End(#) |
Value of Unexercised
In-The-Money Options($)(1) |
|||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Exercisable | Unexercisable | Exercisable | Unexercisable | ||||||||||
Alston D. Correll | | | 590,150 | 215,650 | 3,971,648 | 1,376,796 | |||||||
Lee M. Thomas | | | 56,900 | -0- | 472,723 | -0- | |||||||
Donald L. Glass | | | 247,550 | 246,850 | 1,404,321 | 1,671,966 | |||||||
Ronald L. Paul | 18,900 | $154,227 | -0- | -0- | -0- | -0- | |||||||
James F. Kelley | | | 83,025 | 41,675 | 566,327 | 279,516 | |||||||
(1)
|
Represents the amount by which the closing price on December 31, 2000 ($29.9375) exceeded the exercise prices of unexercised
options.
|
17
Estimated Future Payouts Under
Non-Stock Price Based Plans (3) |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number of G-P
Group Shares (#)(1) |
Performance or Other
Period Until Maturation or Payout (2) |
Threshold
(#) |
Target
(#) |
Maximum
(#) |
||||||
Alston D. Correll | 19,650 | December 31, 2002 | 9,825 | 19,650 | 39,300 | ||||||
Lee M. Thomas | 8,550 | December 31, 2002 | 4,275 | 8,550 | 17,100 | ||||||
Donald L. Glass | -0- | ||||||||||
Ronald L. Paul | 8,550 | December 31, 2002 | 4,275 | 8,550 | 17,100 | ||||||
James F. Kelley | 4,500 | December 31, 2002 | 2,250 | 4,500 | 9,000 | ||||||
(1)
|
Performance rights grants pursuant to the Georgia-Pacific Group LTIP in January 2000.
|
(2)
|
The period for each grant began on January 1, 2000 and ends on the date indicated in the above chart.
|
(3)
|
If the performance goals are met, awards are made in restricted stock and vest on the fifth anniversary of the award date.
The actual amount of any award of restricted stock is determined by Georgia-Pacifics percentile total shareholder return as compared to the companies in the Standard & Poors Paper and Forest Products Industry Index (except
Georgia-Pacific). For the above grant, those percentile performance targets are:
|
n Threshold | 30th percentile | |
n Target | 54th percentile | |
n Maximum | 100th percentile |
See Compensation Committee Report Long-Term Equity Incentive Compensation beginning on page 13
for a description of the grants. Upon vesting an LTIP Payout will be reported in the Summary Compensation Table.
|
18
n
|
involuntarily for other than cause, death or disability,
|
n
|
voluntarily following an adverse change in such officers position, authority, duties or responsibilities,
|
n
|
voluntarily following specified changes in place of employment
|
n
|
a multiple (not to exceed 3) times the sum of annual salary and the average of up to 3 of most recent annual bonus
awards,
|
n
|
any federal excise and related income tax payments payable by the officer as a result of the agreement, and
|
n
|
employer contributions, and interest thereon, that would have been made under Georgia-Pacifics Salaried Pension Plan
and Salaried 401(k) Plan
|
n
|
annually for life, 50% of average of last 4 years salary, including bonuses, and
|
n
|
annually for surviving spouses life, 50% of amount payable to officer
|
n
|
actuarially equivalent (to Alternative 1) amounts made in equal monthly payments:
|
n
|
for officers and surviving spouses life, or
|
n
|
for 120 months
|
Retirement
Age |
Minimum
Years of Service |
Payments
Begin at |
Proportionately
Reduced for Retirement Below |
||||
---|---|---|---|---|---|---|---|
55 to 64 | 15 | retirement | age 62 | ||||
55 to 64 | 3-14 | age 62 | * | ||||
65+ | | retirement | |
*
|
Benefits reduced proportionally for service under 15 years
|
19
Retirement on January 1, 2001 |
Retirement at Age 65 |
|||||
---|---|---|---|---|---|---|
Annual Benefits |
Years of Credited Service |
Annual Benefit(2) |
||||
Mr. Correll | $899,182 | 12 | $1,123,977 | |||
Mr. Thomas | 185,744 | 7 | 398,022 | |||
Mr. Glass | 400,494 | 28 | 400,494 | |||
Mr. Paul | 119,731 | 5 | 359,192 | |||
Mr. Kelley | 150,364 | 7 | 322,208 |
(1)
|
Compensation for these purposes means only base salary (including salary deferred as before-tax contributions to
the 401(k) Plan) and annual incentive bonuses, if any, and excludes any other cash or non-cash compensation items.
|
(2)
|
Represents the formula benefit at the normal retirement age of 65 under the Retirement Agreement, based on average annual
compensation during the period 1997-2000.
|
20
Number of Shares Beneficially Owned |
Percent of Class
Beneficially Owned |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Name |
Georgia-Pacific Group |
The Timber Company |
G-P Group |
Timber |
||||||||
Greater Than 5% Beneficial Owners: | ||||||||||||
Southeastern Asset
Management, Inc. Longleaf Partners Fund Mr. O. Mason Hawkins 6410 Poplar Ave., Suite 900 Memphis, TN 38119 |
20,467,400 | (1) | 25.6 | % | ||||||||
Capital Research and Management
Company The Income Fund of America, Inc. 333 South Hope Street Los Angeles, CA 90071 |
19,411,440 | (1) | 7,225,000 | (1) | 8.6 | % | 9.0 | % | ||||
AXA Financial, Inc.
Alliance Capital Management L.P. The Equitable Life Assurance Society of the United States and certain of their affiliates 1290 Avenue of the Americas New York, New York 10104 |
14,897,065 | (1) | 6.6 | % | ||||||||
The Prudential Insurance Company
of America |
||||||||||||
751 Broad Street
Newark, NJ 07102-3777 |
11,741,831 | (1) | 5.23 | % | ||||||||
FMR Corp. and certain affiliates | ||||||||||||
82 Devonshire Street | ||||||||||||
Boston, MA 02109 | 14,621,489 | (1) | 6.5 | % | ||||||||
Directors and Executive Officers: | ||||||||||||
James S. Balloun | 4,149 | (2)(3) | 1,398 | (2)(3) | * | * | ||||||
Barbara L. Bowles | 9,331 | (2)(3)(4) | 324 | (2)(3) | * | * | ||||||
Robert Carswell | 11,353 | (2)(3) | 6,000 | (2)(3) | * | * | ||||||
Worley H. Clark, Jr. . | 19,251 | (3)(4) | 324 | (3) | * | * | ||||||
Alston D. Correll | 1,323,016 | (5) | 731,112 | (5) | * | * | ||||||
Jane Evans | 4,511 | (3) | 2,579 | (3) | * | * | ||||||
Donald V. Fites | 9,475 | (2)(3) | 5,145 | (6)(3) | * | * | ||||||
Harvey C. Fruehauf, Jr. | 834,829 | (3)(6) | 430,754 | (3)(6) | * | * | ||||||
Richard V. Giordano | 9,905 | (3) | 5,276 | (3) | * | * | ||||||
David R. Goode | 5,911 | (2)(3) | 3,279 | (2)(3) | * | * | ||||||
M. Douglas Ivester | 6,403 | (2)(3) | 3,525 | (2)(3) | * | * | ||||||
James P. Kelly | 1,064 | (2)(3) | 1,086 | (2)(3) | * | * | ||||||
Louis W. Sullivan | 5,847 | (3) | 3,400 | (3) | * | * | ||||||
James B. Williams | 27,369 | (2)(3) | 14,008 | (2)(3) | * | * | ||||||
Donald L. Glass | 51,892 | (5) | 436,694 | (5) | * | * | ||||||
Lee M. Thomas | 246,358 | (5) | 61,900 | (5) | * | * | ||||||
James F. Kelley | 105,785 | (5) | 94,046 | (5) | * | * | ||||||
Ronald L. Paul | 127,688 | (5) | * | * | ||||||||
All Directors and Executive Officers
as a Group (26 persons) |
3,371,087 | (3)(4)(7) | 2,063,304 | (3)(4)(7) | 1.49 | % | 2.56 | % |
21
(1)
|
According to a Schedule 13G filed with the SEC, and subject to the qualifications therein.
|
(2)
|
In addition to the shares beneficially owned, the following directors have elected to defer payment of a portion of the
directors fees paid or payable to them, with such amounts to earn a return to be determined as if they had been invested in our common stock. The deferred compensation account of the directors listed below included amounts equivalent to the
number and class of shares of common stock listed opposite their names:
|
Georgia-Pacific Group Stock |
The Timber Company Stock |
|||
---|---|---|---|---|
Mr. Balloun | 2,106 | 1,678 | ||
Ms. Bowles | 59 | 59 | ||
Mr. Carswell | 18,845 | 10,247 | ||
Mr. Fites | 2,808 | 2,128 | ||
Mr. Goode | 10,359 | 6,166 | ||
Mr. Ivester | 8,981 | 5,417 | ||
Mr. Kelly | 1,128 | 1,149 | ||
Mr. Williams | 13,348 | 7,852 | ||
(3) Includes the following number of restricted shares received under the Outside Directors Stock Plan: | ||||
Georgia-Pacific Group Stock |
The Timber Company Stock |
|||
Mr. Balloun | 2,149 | 1,398 | ||
Ms. Bowles | 324 | 324 | ||
Mr. Carswell | 9,353 | 5,000 | ||
Mr. Clark | 324 | 324 | ||
Ms. Evans | 4,511 | 2,579 | ||
Mr. Fites | 5,645 | 3,146 | ||
Mr. Fruehauf | 9,701 | 5,174 | ||
Mr. Giordano | 7,905 | 4,276 | ||
Mr. Goode | 4,911 | 2,779 | ||
Mr. Ivester | 4,403 | 2,525 | ||
Mr. Kelly | 1,046 | 1,046 | ||
Dr. Sullivan | 5,319 | 2,983 | ||
Mr. Williams | 7,369 | 4,008 | ||
(4) Includes the following number of shares as to which the following directors have the right to acquire beneficial ownership through the exercise of stock options under the Fort James Corporation Stock Option Plan for Outside Directors: | ||||
Georgia-Pacific Group Stock |
||||
Ms. Bowles | 8,393 | |||
Mr. Clark. | 18,296 | |||
(5) Includes the following number of shares as to which the following executive officers have the right to acquire beneficial ownership through the exercise of stock options: | ||||
Georgia-Pacific Group Stock |
The Timber Company Stock |
|||
Mr. Correll | 1,086,796 | 634,112 | ||
Mr. Thomas | 228,090 | 56,900 | ||
Mr. Glass | 50,200 | 310,280 | ||
Mr. Paul | 111,526 | |||
Mr. Kelley | 100,528 | 93,259 |
(6)
|
Mr. Fruehauf has: (i) sole voting and investment power as to 224,089 shares of Georgia-Pacific Group Stock and 112,368 shares
of The Timber Company Stock; (ii) sole voting power and shared investment power as to 309,834 shares of Georgia-Pacific Group Stock and 154,917 shares of The Timber Company Stock; (iii) shared voting and investment power as to 238,196 shares of
Georgia-Pacific Group Stock and 132,114 shares of The Timber Company Stock; and (iv) shared investment power, but no voting power, as to 62,710 shares of Georgia-Pacific Group Stock and 31,355 shares of The Timber Company Stock.
|
(7)
|
Includes, as of March 1, 2001, an aggregate of 566,950 shares of Georgia-Pacific Group Stock and 262,455 shares of The Timber
Company Stock, including restricted stock and stock which may be acquired through the exercise of stock options, of which our executive officers (other than Messrs. Correll, Glass, Kelley, Paul and Thomas) have beneficial ownership.
|
22
1993 | 1994 | 1995 | 1996 | 12/16/97 | |||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Georgia-Pacific Corporation | $100 | $106.39 | $104.56 | $112,85 | $136.56 | ||||||
S&P 500 P&FP Stock Index** | $100 | $104.20 | $114.72 | $126.90 | $137.85 | ||||||
S&P 500 Stock Index** | $100 | $101.32 | $139.40 | $171.40 | $227.41 |
*
|
Assumes that the value of the investment in Georgia-Pacific Corporation common stock and each index was $100 on December 31,
1994 and that all dividends were reinvested.
|
**
|
Provided by Standard & Poors Compustat, a division of The McGraw-Hill Companies.
|
23
December 17, 1997 | 1998 | 1999 | 2000 | ||||||
---|---|---|---|---|---|---|---|---|---|
Georgia-Pacific Group | $100 | $94.55 | $165.91 | $103.23 | |||||
S&P 500 P&FP Stock Index** | $100 | $100.67 | $142.78 | $116.81 | |||||
S&P 500 Stock Index** | $100 | $129.23 | $156.58 | $129.74 | |||||
*
|
Assumes that the value of the investment in Georgia-Pacific Group Stock and each index was $100 on December 17, 1997 and that
all dividends were reinvested.
|
**
|
Provided by Standard & Poors Compustat, a division of The McGraw-Hill Companies.
|
December 17, 1997 | 1998 | 1999 | 2000 | ||||||
---|---|---|---|---|---|---|---|---|---|
The Timber Company | $100 | $99.58 | $107.49 | $136.01 | |||||
S&P Midcap 400 Index** | $100 | $122.33 | $140.36 | $165.01 | |||||
Industry Peer Group*** | $100 | $91.29 | $89.88 | $81.79 | |||||
*
|
Assumes that the value of the investment in The Timber Company Stock and each index was $100 on December 17, 1997 and that
all dividends were reinvested.
|
**
|
Provided by Standard & Poors Compustat, a division of The McGraw-Hill Companies.
|
***
|
Consisting of Deltic Timber Corp., Plum Creek Timber Co. LP, Crown Pacific Partners LP and U.S. Timberlands Co.
LP.
|
24
Relative EVA
Percentile |
Objective Bonus
Opportunity |
|||
---|---|---|---|---|
n Threshold | 30th | 50% | ||
n Target | 54th | 100% | ||
n Maximum | 100th | 200% |
25
Name and Position |
2000 Awards
Paid Dollar Value ($) |
||
---|---|---|---|
Mr. Correll
Chairman, Chief Executive Officer and President |
1,800,000 | ||
Mr. Thomas
Executive Vice President Consumer Products |
475,000 | ||
Mr. Glass
Executive Vice President Timber and Chief Executive Officer The Timber Company |
-0- | * | |
Mr. Paul
Executive Vice President Wood Products and Distribution |
340,000 | ||
Mr. Kelley
Executive Vice President and General Counsel |
350,000 | ||
Executive Group | 5,125,500 | ||
Non-Executive Director Group | -0- | ** | |
Non-Executive Officer Employee Group | 29,612,740 | *** |
*
|
Mr. Glass does not participate in EVIP.
|
**
|
Non-employee directors are not eligible to participate in the EVIP.
|
***
|
Based on 989 participants in 2000. We expect (although it is not determinable at this time) to double this category as a
result of our acquisition of Fort James.
|
26
27
28
1.
|
Oversee the activities of Georgia-Pacifics management in its preparation of Georgia-Pacifics financial statements
and related financial disclosures, and review and discuss the audited financial statements with management. To carry out this responsibility, the Audit Committee may, to the extent it considers appropriate:
|
(a)
|
review with management the existence and substance of any significant accounting accruals, reserves or other financial
reporting judgments that had or may have a material impact on Georgia-Pacifics financial statements;
|
A-1
(b)
|
discuss with management and the independent public accountant any significant changes in the accounting principles used to
prepare such financial statements, including significant changes in accounting and financial reporting standards proposed by the SEC or the FASB;
|
(c)
|
discuss with management and the independent public accountant any significant issues or disagreements between them affecting
the preparation of Georgia-Pacifics financial statements and how they were resolved; and
|
(d)
|
review and discuss with management the scope and content of the Management Discussion and Analysis section of
Georgia-Pacifics quarterly and annual financial statements.
|
2.
|
Oversee the activities of Georgia-Pacifics independent public accountant. To carry out this responsibility, the Audit
Committee will, to the extent it determines appropriate:
|
(a)
|
propose to the Board annually the appointment of the independent public accountant, which shall be accountable to the Board
of Directors and the Committee;
|
(b)
|
approve the annual audit plan of the independent public accountant and its fees;
|
(c)
|
meet privately with the independent public accountant to discuss the audited financial statements of Georgia-Pacific,
including major issues regarding the applicability of accounting and auditing principles and practices, the scope of the audit, the adequacy of Georgia-Pacifics internal financial controls, and other matters that could significantly affect the
quality of Georgia-Pacifics audited financial statements;
|
(d)
|
discuss with the independent public accountant the matters required by Statement on Auditing Standards No. 61, review and
discuss with the independent public accountant the written disclosures required by Independence Standards Board Standard No. 1 regarding their independence, and recommend to the Board any appropriate action to ensure such independence;
|
(e)
|
review with management and the independent public accountant key issues involved in Georgia-Pacifics quarterly
financial statements prior to the filing of such financial statements with the SEC; and
|
(f)
|
review annually the nature and extent of management consulting and other non-audit services provided by the independent
public accountant, and its fees for such services.
|
3.
|
Periodically review with management the areas of greatest risk to the operations and financial results of Georgia-Pacific,
such as environmental regulations, major pending litigation, tax issues or significant financial exposure, and the steps management has or intends to take to monitor and control such risks. To carry out this responsibility, the Audit Committee will,
to the extent it considers appropriate:
|
(a)
|
periodically meet with management to review such areas of risk, and discuss the steps management has taken or proposes to
take to monitor and control such risks;
|
(b)
|
oversee the functioning of the Internal Audit Department, including its staffing, budget and workplans, review the periodic
reports prepared by it, and review its charter, responsibility, authority and reporting relationships;
|
A-2
(c)
|
review with the General Counsel all legal and regulatory matters that may have a material impact on Georgia-Pacifics
financial statements and the scope and effectiveness of its compliance policies; and
|
(d)
|
review periodically with the Director of Corporate Security significant cases of alleged employee conflict of interest,
ethical violations, misconduct or fraud, the volume and nature of calls to the Companys hot line and other matters and issues affecting the security of Georgia-Pacifics assets and employees.
|
4.
|
Regularly report to the Board of Directors the Audit Committees activities and its conclusions with respect to the
matters it has considered, including (i) an annual recommendation that Georgia-Pacifics audited financial statements be included in its annual 10-K filing with the SEC; (ii) the report that the Committee has approved for inclusion in the
annual Georgia-Pacific proxy statement; and (iii) any recommendation based on its annual review and assessment of the adequacy of this Charter.
|
A-3
(a)
|
in the traditional salary grade pay structure, such Participants base annual salary in effect as of January 1 of the
applicable calendar year;
|
(b)
|
in the broad level salary grade pay structure, such Participants base annual salary in effect as of such
Participants common review date for the applicable calendar year; or
|
(c)
|
who becomes a Participant after January 1 or after his or her common review date, as applicable, such Participants base
annual salary in effect as of the date his or her participation commences.
|
(a)
|
in the traditional salary grade pay structure, midpoint of the Participants salary grade as of January 1 of the
calendar year; or
|
(b)
|
in the broad level salary grade pay structure, such Participants annual base salary determined as of the common review
date for such Participant for that calendar year.
|
B-1
(a)
|
is an officer of Georgia-Pacific Corporation during that year;
|
(b)
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is employed on January 1 and is designated by the CEO or the Committee as a Participant at the beginning of that year;
or
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(c)
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is added as a Participant before the fourth quarter of that year by act of the CEO; and
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(d)
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does not participate in any other incentive compensation program maintained by the Corporation, other than a stock option
plan.
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(a)
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The identity of each Affected Officer for the calendar year;
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(b)
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The threshold, target and maximum Relative EVA Ranking for that calendar year;
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(c)
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The Peer Group Companies for the calendar year;
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(d)
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Each Participants Bonus Percentage, which is the percentage of his or her Compensation that could be paid as the total
(Quantitative and Discretionary) bonus under this Plan if the target Relative EVA Ranking is achieved for such calendar year; and
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(e)
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The Quantitative Bonus Weighting, which is the percentage of the total bonus opportunity for the calendar year which will
comprise the Quantitative Bonus.
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B-2
(a)
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After the close of such calendar year, the Committee will certify in writing the Relative EVA Ranking achieved by the G-P
Group for that calendar year.
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(b)
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Subject to § 4.5, the Participants Quantitative Bonus will equal (i) the Participants Bonus Percentage
multiplied by (ii) the Quantitative Bonus Weighting multiplied by (iii) the percentage of the target Quantitative Bonus that was earned based on the achieved Relative EVA Ranking, and then multiplied by (iv) the Participants
Compensation.
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(c)
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The amount of Quantitative Bonus for any Relative EVA Ranking between a given level and the next preceding or following level
shall be determined by interpolation between those two levels.
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(d)
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If the achieved Relative EVA Ranking for a calendar year is less than the threshold Relative EVA Ranking set for that year,
no Quantitative Bonus will be paid.
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(a)
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EVA. For each calendar year, EVA will equal the net operating profit after tax for
that year minus a capital charge determined by multiplying the weighted average cost of debt and equity capital for that calendar year by the average invested capital for that year.
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(b)
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Relative EVA Ranking. For purposes of determining the Relative EVA Ranking of the G-P Group,
EVA for each Peer Group Company will be the Indexed EVA for such company, which is determined by subtracting that Peer Group Companys weighted average cost of debt and equity capital from its return on average invested
capital and multiplying the difference by the G-P Groups average invested capital.
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(c)
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Defined Terms. For purposes of this § 4:
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(i)
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net operating profit after tax for each calendar year is reported net earnings for that year adjusted by (A)
adding net interest expense for that calendar year, (B) adding goodwill amortization for that calendar year, (C) eliminating the effect of changes in LIFO inventory reserve for that calendar year, (D) eliminating the effects of Special Items during
that calendar year (such as non-recurring gains or losses, disposals of assets, restructuring charges and similar items), and (E) adjusting taxes for that calendar year to reflect actual cash taxes paid and eliminating the tax benefit of interest
expense;
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(ii)
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average invested capital for a calendar year is the average of the sum of short-term debt, long-term debt and
adjusted book value of equity at the beginning of that year and at the end of that year; and
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(iii)
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return on average invested capital for a calendar year is the net operating profit after tax divided
by the average invested capital for that year.
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(d)
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Determinations. All determinations made under this § 4 shall be based (i) with respect to
the Corporation, on its unaudited financial results for the calendar year, and (ii) with respect to each Peer Group Company, on its unaudited financial results as reported on its Forms 10-Q for the first three quarters of the calendar year plus its
unaudited financial results for the fourth quarter of the calendar year determined from financial data provided in its earnings release in January of the immediately following calendar year using the Corporations pre-established assumptions,
policies and procedures.
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B-3
(a)
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200% of (i) the maximum total Quantitative Bonus and Discretionary Bonus that the Participant could receive if the target
Relative EVA Ranking was achieved in that calendar year multiplied by (ii) the Quantitative Bonus Weighting for that calendar year, or
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(b)
|
125% (or, with respect to the CEO, 220%) of the Participants Base Salary for that calendar year.
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(a)
|
Participants Other Than the CEO and Affected Officers. The CEO, in his discretion, shall determine the amount of the
Discretionary Bonus for each calendar year for each Participant after reviewing, (i) the performance of the business unit to which such Participant belongs during that calendar year with respect to EVA drivers specified by the CEO, and (ii) the
actions taken by the business unit during that calendar year to increase the long-term EVA of that business unit and/or the Corporation as a whole. In conducting this review, the CEO may consider any actions by business units he deems appropriate,
including but not limited to actions to (i) increase efficiency (by increasing revenue or reducing costs using the same or less capital), (ii) develop new investment opportunities, and/or (iii) reduce or divest under-performing assets.
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(b)
|
Affected Officers. For each Affected Officer, the Discretionary Bonus for a each calendar year will equal the
Discretionary Bonus limit (as described in § 5.4 below) for such Affected Officer, subject to reduction by the Committee, in its discretion, based on its review and evaluation of such performance criteria as the Committee may deem
appropriate.
|
(c)
|
CEO. For the CEO, the Discretionary Bonus for a each calendar year shall equal 200% of his Quantitative Bonus for that
year, subject to reduction by the Committee in its discretion based on its review and evaluation of such performance criteria as the Committee may deem appropriate.
|
(a)
|
the amount of the maximum total Quantitative Bonus and Discretionary Bonus the Participant could receive if the target
Relative EVA Ranking was achieved in that calendar year;
|
(b)
|
125% of the Participants Base Salary for that calendar year, reduced by the Quantitative Bonus for that calendar year;
or
|
B-4
(c)
|
the amount of the maximum total Quantitative Bonus and Discretionary Bonus the Participant could receive if the G-P
Groups maximum Relative EVA Ranking was achieved in that calendar year, reduced by the Quantitative Bonus paid for that calendar year.
|
(a)
|
200% of his Quantitative Bonus for that calendar year, or
|
(b)
|
220% of the CEOs Base Salary for that calendar year, reduced by the Quantitative Bonus paid for that calendar
year.
|
(a)
|
terminates employment during the calendar year after he or she has attained at least age 65 or has attained age 55 and
accumulated at least ten (10) years of vesting service under the Georgia-Pacific Corporation Salaried 401(k) Plan,
|
(b)
|
dies during the calendar year;
|
(c)
|
becomes totally and permanently disabled (as determined by the Committee or its delegate pursuant to the standards of the
Georgia-Pacific Corporation Salaried Long-Term Disability Plan); or
|
(d)
|
is added as a Participant mid-year by act of the CEO.
|
B-5
B-6
B-7
P R O X Y
GEORGIA-PACIFIC CORPORATION
Proxy Solicited by the Board of Directors
For Annual Meeting May 1, 2001
The undersigned, having received the Notice of Annual Meeting and Proxy Statement, hereby appoints (i) A.D. Correll, James F. Kelley and/or Kenneth F. Khoury, jointly and severally, proxies with full power of substitution, to vote all shares of both Georgia-Pacific Group common stock and Timber Group common stock of GEORGIA-PACIFIC CORPORATION owned of record by the undersigned, and which the undersigned is entitled to vote, (ii) Vanguard Fiduciary Trust Company, as Trustee under the Georgia-Pacific Corporation Salaried 401(k) Plan, the Georgia-Pacific Corporation Hourly 401(k) Plan, and the Unisource Worldwide, Inc. Retirement Savings Plan (the Vanguard Plans), to vote in person or by proxy all shares of both Georgia-Pacific Group common stock and Timber Group common stock of GEORGIA-PACIFIC CORPORATION allocated to any accounts of the undersigned under the Vanguard Plans, and (iii) Northern Trust Company, as Trustee under the Fort James 401(k) Plan (the Northern Trust Plan), to vote in person or by proxy all shares of Georgia-Pacific Group common stock of GEORGIA-PACIFIC CORPORATION allocated to any accounts of the undersigned under the Northern Trust Plan on all matters that may come before the 2001 Annual Meeting of Shareholders to be held at the Radisson Riverfront Hotel, 2 Tenth Street, Augusta, Georgia on May 1, 2001 at 11:00 a.m., local time, and any adjournments thereof, unless otherwise specified herein.
Election of Directors | ||||
1. Nominee in Class I: | 01) Worley H. Clark, Jr. | Change of Address: | ||
Nominees in Class II: | 02) Barbara L. Bowles
03) Donald V. Fites 04) David R. Goode 05) James B. Williams |
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||
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||||
Nominees in Class III: | 06) John D. Zeglis | (If you have written in the above space, please mark the corresponding box on the reverse side of this card.) |
Whether or not you plan to attend the Annual Meeting, you are urged to
complete, date, sign and return this proxy in the accompanying envelope if you are voting by mail. |
SEE REVERSE
SIDE |
||
FOLD AND DETACH HERE IF YOU ARE VOTING BY MAIL
ADMISSION TICKET
ANNUAL MEETING OF SHAREHOLDERS
If you plan to attend the 2001 Annual Meeting of Shareholders, please mark the appropriate box on the reverse side of the attached Proxy Card. The meeting will be held on Tuesday, May 1, 2001, at the Radisson Riverfront Hotel, 2 Tenth Street, Augusta, Georgia. The meeting will begin promptly at 11:00 a.m. local time.
TO AVOID DELAY AT THE ENTRANCE, PLEASE PRESENT THIS TICKET
AGENDA: ELECTION OF SIX DIRECTORS VOTE ON THE REAPPROVAL OF THE ECONOMIC VALUE INCENTIVE PLAN TRANSACTIONS OF SUCH OTHER BUSINESS AS MAY PROPERLY COME
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It is important that your shares are represented at this meeting, whether or not you attend the meeting in person.
To make sure your shares are represented, we urge you to complete and mail the attached Proxy Card
or vote by phone or internet.
[X] Please mark your votes as in this example.
This Proxy, when properly executed, will be voted as directed. If no instructions are specifed, this proxy will be voted FOR ALL nominees named in Proposal 1 and FOR Proposal 2.
|
||||||||
The Board of Directors recommends a vote FOR each of Proposals 1 and 2. | ||||||||
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||||||||
FOR
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WITHHELD
|
FOR
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AGAINST
|
ABSTAIN
|
||||
1. Election of Directors
(see reverse) |
[_]
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[_]
|
2. Reapproval of the
Economic Value Incentive Plan. |
[_]
|
[_]
|
[_]
|
||
For, except vote withheld from the following nominee(s): | ||||||||
|
Change of address on reverse side. [_] I plan to attend the Annual Meeting. [_]
|
||
At the present time, the Board of Directors knows of no other business to be presented to a vote of the shareholders at the Annual Meeting. However, the proxies hereby are authorized to vote in their discretion on (i) the election of any person as director if a director nominee named in Proposal 1 is unable to serve or for good cause will not serve, and (ii) on matters incident to the conduct of the Annual Meeting. | ||
Receipt of the Notice of Meeting, Proxy Statement and Annual Report is hereby acknowledged. | ||
Please sign EXACTLY as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. | ||
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||
|
||
SIGNATURE (S) DATE |
FOLD AND DETACH HERE IF YOU ARE VOTING BY MAIL
GEORGIA-PACIFIC CORPORATION
133 PEACHTREE STREET, N.E.
ATLANTA, GEORGIA 30303
Georgia-Pacific Corporation
Proxy Solicited by the Board of Directors for Annual Meeting of Shareholders May 1, 2001
IF YOU WISH TO VOTE BY TELEPHONE OR INTERNET PLEASE READ THE INSTRUCTIONS BELOW |
Georgia-Pacific Corporation encourages you to take advantage of convenient ways to vote your shares for matters to be covered at the 2001 Annual Meeting of Shareholders. Please take the opportunity to use one of the three voting methods described below to cast your ballot.
VOTE BY PHONE 1-877-779-8683 (1-877-PRX-VOTE)
Use any touch-tone telephone to vote your proxy 24 hours a day, 7 days a week. Have your proxy card in hand when you call. You will be prompted to enter your Control Number, which is located above and then follow the simple instructions the Vote Voice provides you.
VOTE BY INTERNET www.eproxyvote.com/gp
Use the Internet to vote your proxy 24 hours a day, 7 days a week. Have your proxy card in hand when you access the web site. You will be prompted to enter your Control Number, which is located above to obtain your records and create an electronic ballot.
VOTE BY MAIL
Mark and sign above as your name appears at left. When signing as attorney, executor, administrator, trustee or guardian, please give your full title as such. Each joint owner or trustee should sign the proxy. If the shareholder is a corporation, the office of the person signing should be indicated.
ELECTRONIC DELIVERY OF PROXY MATERIALS
Sign up to receive next years Annual Report and proxy materials via the Internet rather than by mail. Next year when the materials are available, we will send you an e-mail with instructions which will enable you to review these materials online. To sign up for this optional service, visit http://www.econsent.com/gp
IF YOU VOTE BY PHONE OR USE THE INTERNET, PLEASE DO NOT MAIL YOUR PROXY. THANK YOU FOR VOTING.
133 Peachtree Street NE (30303-1847)
P.O. Box 105605 Atlanta, Georgia 30348-5605 (404) 652-4000 www.gp.com |
To: | Participants in the Georgia-Pacific Group Stock Fund or Georgia-Pacific Timber Stock Fund of the Georgia-Pacific Corporation Salaried 401(k) Plan, the Georgia-Pacific Hourly 401(k) Plan, and the Unisource Worldwide, Inc. Retirement Savings Plan (the "Plans"): |
In connection with the Georgia-Pacific Corporation 2001 Annual Meeting of Shareholders (the "Annual Meeting") to be held on May 1, 2001, enclosed are proxy materials with respect to shares allocated to you in either the Georgia-Pacific Group Stock Fund or Georgia-Pacific Timber Stock Fund.
We wish to call your attention to the fact that pursuant to the provisions of the Plans, Vanguard Fiduciary Trust Company, the Trustee under the Plans, cannot vote your allocable shares of either Georgia-Pacific Group Common Stock or Timber Group Common Stock on the matters to be acted on at the Annual Meeting without your specific voting instructions. Accordingly, in order for your allocable shares to be voted at the Annual Meeting, please provide voting instructions by one of the three voting methods outlined below to cast your ballot:
VOTE BY PHONE - Use any touch-tone phone to vote your proxy 24 hours a day, 7 days a week. Have your proxy card in hand when you call. You will be prompted to enter your Control Number, which is located on the enclosed card and follow the simple instructions the Vote Voice provides you.
VOTE BY INTERNET - Use the Internet to vote your proxy 24 hours a day, 7 days a week. Have your proxy card in hand when you access the web site (www.eproxyvote.com/gp). You will be prompted to enter your Control Number, which is located on the enclosed card to obtain your records and create an electronic ballot.
VOTE BY MAIL - Mark and sign your name, as it appears on the enclosed card and return it promptly in the enclosed, self-addressed, postage-paid envelope. It is understood that if you sign without otherwise marking the card, you wish the Trustee to vote your shares "FOR ALL" on the election of directors and "FOR" proposal 2, as recommended by the Board of Directors of Georgia-Pacific Corporation.
We urge you to send in the enclosed card promptly so that the Trustee may vote the shares allocable to you under the Plans in accordance with your wishes.
Very truly yours, | ||||
Date: | March 29, 2001 | Kenneth F. Khoury
Vice President, Deputy General Counsel and Secretary |
133 Peachtree Street NE (30303-1847)
P.O. Box 105605 Atlanta, Georgia 30348-5605 (404) 652-4000 www.gp.com |
To: | Participants in the Georgia-Pacific Group Stock Fund of the Fort James 401(k) Plan (the "Plan"): |
In connection with the Georgia-Pacific Corporation 2001 Annual Meeting of Shareholders (the "Annual Meeting") to be held on May 1, 2001, enclosed are proxy materials with respect to shares allocated to you in the Georgia-Pacific Group Stock Fund.
We wish to call your attention to the fact that pursuant to the provisions of the Plan, Northern Trust Company, the Trustee under the Plan, will vote your allocable shares of Georgia-Pacific Group Common Stock on the matters to be acted on at the Annual Meeting in accordance with your specific voting instructions. If you do not give any instruction to the Trustee, the Trustee will vote your allocable shares proportionately in the same manner as it votes shares in the Group Stock Fund for which it does receive voting instructions. Accordingly, in order for your allocable shares to be voted in accordance with your directions, please provide voting instructions by one of the three voting methods outlined below to cast your ballot:
VOTE BY PHONE - Use any touch-tone phone to vote your proxy 24 hours a day, 7 days a week. Have your proxy card in hand when you call. You will be prompted to enter your Control Number, which is located on the enclosed card and follow the simple instructions the Vote Voice provides you.
VOTE BY INTERNET - Use the Internet to vote your proxy 24 hours a day, 7 days a week. Have your proxy card in hand when you access the web site (www.eproxyvote.com/gp). You will be prompted to enter your Control Number, which is located on the enclosed card to obtain your records and create an electronic ballot.
VOTE BY MAIL - Mark and sign your name, as it appears on the enclosed card and return it promptly in the enclosed, self-addressed, postage-paid envelope. It is understood that if you sign without otherwise marking the card, you wish the Trustee to vote your shares "FOR ALL" on the election of directors and "FOR" proposal 2, as recommended by the Board of Directors of Georgia-Pacific Corporation.
We urge you to send in the enclosed card promptly so that the Trustee may vote the shares allocable to you under the Plans in accordance with your wishes.
Very truly yours, | ||||
Date: | March 29, 2001 | Kenneth F. Khoury
Vice President, Deputy General Counsel and Secretary |