GEORGIA-PACIFIC CORPORATION
(the "Corporation")
TERMS AGREEMENT
November 5, 1999
Georgia-Pacific Corporation
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxx
Chief Financial Officer
Ladies and Gentlemen:
On behalf of the several Underwriters named in Schedule
A hereto and for their respective accounts, we offer to purchase,
on and subject to the terms and conditions of the form of
Underwriting Agreement filed as an exhibit to the Corporation's
registration statements on Form S-3 (File Nos. 33-43453 and 333-
80757) (the "Underwriting Agreement"), the following securities
(the "Securities") on the following terms:
Title: 7-3/4% Debentures Due 2029.
Principal Amount: $500,000,000.
Interest: 7-3/4% per annum, from November 10, 1999,
payable semiannually in arrears on May 15 and November 15,
commencing May 15, 2000, to holders of record on the immediately
preceding May 1 or November 1, as the case may be.
Maturity: November 15, 2029.
Make Whole Redemption: The Debentures will be
redeemable, in whole or from time to time in part, at the option
of the Corporation on any date (a "Redemption Date"), at a
redemption price equal to the greater of:
(i) 100% of the principal amount of the
Debentures to be redeemed; and
(ii) the sum of the present values of the
remaining scheduled payments of principal and interest
thereon (exclusive of interest accrued to such Redemption
Date) discounted to such Redemption Date on a semiannual
basis (assuming a 360-day year consisting of twelve 30-day
months) at the Treasury Rate (as defined below) plus 25
basis points,
plus, in either case, accrued and unpaid interest on the
principal amount being redeemed to such Redemption Date;
provided that installments of interest on the Debentures
which are due and payable on an interest payment date
falling on or prior to the relevant Redemption Date shall be
payable to the holders of the Debentures, registered as such
at the close of business on the relevant record date
according to their terms and the provisions of the
Indenture.
"Treasury Rate" means, with respect to any Redemption
Date for the Debentures:
(i) the yield, under the heading which represents the
average for the immediately preceding week, appearing in the
most recently published statistical release designated
"H.15(519)" or any successor publication which is published
weekly by the Board of Governors of the Federal Reserve
System and which establishes yields on actively traded
United States Treasury Securities adjusted to constant
maturity under the caption "Treasury Constant Maturities,"
for the maturity corresponding to the Comparable Treasury
Issue (if no maturity is within three months before or after
the Maturity Date, yields for the two published maturities
most closely corresponding to the Comparable Treasury Issue
shall be determined and the Treasury Rate shall be
interpolated or extrapolated from such yields on a straight
line basis, rounding to the nearest month); or
(ii) if such release (or any successor release) is not
published during the week preceding the calculation date or
does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue (expressed as a percentage of its
principal amount) equal to the Comparable Treasury Price for
such Redemption Date.
The Treasury Rate shall be calculated on the third Business Day
preceding the Redemption Date.
"Comparable Treasury Issue" means the United States
Treasury security selected by the Independent Investment Banker
as having a maturity comparable to the remaining term of the
Debentures to be redeemed that would be utilized, at the time of
selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Debentures.
"Independent Investment Banker" means either (a) Xxxxxx
Xxxxxxx & Co. Incorporated or (b) Warburg Dillon Read LLC or, if
each such firm is unwilling or unable to select the Comparable
Treasury Issue, an independent investment banking institution of
national standing appointed by the Trustee after consultation
with, and upon the direction of, the Corporation.
2
"Comparable Treasury Price" means with respect to any
Redemption Date for the Debentures:
(i) the average of four Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the
highest and lowest such Reference Treasury Dealer
Quotations; or
(ii) if the Trustee obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all
such quotations.
"Reference Treasury Dealer" means (a) each of Xxxxxx
Xxxxxxx & Co. Incorporated and Warburg Dillon Read LLC and their
respective successors; provided, however, that if any of the
foregoing shall cease to be a primary U.S. Government securities
dealer in New York City (a "Primary Treasury Dealer"), the
Corporation will substitute therefor another Primary Treasury
Dealer and (b) any two other Primary Treasury Dealers selected by
the Corporation.
"Reference Treasury Dealer Quotations" means, with
respect to each Reference Treasury Dealer and any Redemption
Date, the average, as determined by the Trustee, of the bid and
asked prices for the Comparable Treasury Issue (expressed in each
case as a percentage of its principal amount) quoted in writing
to the Trustee by such Reference Treasury Dealer at 5:00 p.m.
(New York City time) on the third Business Day preceding such
Redemption Date.
Notice of any redemption by the Corporation will be
mailed at least 30 days but not more than 60 days before any
Redemption Date to each holder of the Debentures to be redeemed.
If less than all the Debentures are to be redeemed at the option
of the Corporation, the Trustee shall select, in such manner as
it shall deem fair and appropriate, the Debentures to be redeemed
in whole or in part.
Unless the Corporation defaults in payment of the
redemption price, on and after any Redemption Date interest will
cease to accrue on the Debentures or portions thereof called for
redemption.
Sinking Fund: None.
Delayed Delivery Contracts: None.
Purchase Price: 98.283% of principal amount, plus
accrued interest from November 10, 1999, if any.
Expected Reoffering Price: 99.158% of principal
amount, plus accrued interest from November 10, 1999, if any.
3
Closing: 9:00 a.m. (New York City time) on November
10, 1999, at the offices of Xxxxxxx Xxxxxxx & Xxxxxxxx, 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx with payment to be made in
immediately available funds.
Names and Addresses of Representatives of the
Underwriters:
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Warburg Dillon Read LLC
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
The respective principal amounts of the Securities to
be purchased by each of the Underwriters are set forth opposite
their names in Schedule A hereto.
The provisions of the Underwriting Agreement are
incorporated herein by reference.
The specified percentage of the principal amount of the
Securities for the purposes of Section 10 of the Underwriting
Agreement shall be 10%.
The Securities will be made available for checking and
packaging at the office of The Bank of New York at least 24 hours
prior to the Closing Date.
This Terms Agreement, including your acceptance hereof,
may be executed by any one or more of the parties hereto and
thereto in any number of counterparts, each of which shall be
deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
(Signatures on following page)
(Signature page to Terms Agreement)
Please signify your acceptance of our offer by signing
the enclosed response to us in the space provided and returning
it to us.
Very truly yours,
XXXXXX XXXXXXX & CO. INCORPORATED
WARBURG DILLON READ LLC,
for themselves and as
Representatives of the several
Underwriters named in Schedule A
hereto
By: WARBURG DILLON READ LLC
/S/ Xxxxx Xxxxx
Name: Xxxxx Xxxxx
Title: Executive Director
/S/ Xxxx Xxx
Name: Xxxx Xxx
Title: Associate
SCHEDULE A
Underwriter Principal
Amount
Xxxxxx Xxxxxxx & Co. Incorporated $150,000,000
Warburg Dillon Read LLC 150,000,000
Banc of America Securities LLC 50,000,000
Xxxxxxx, Xxxxx & Co. 50,000,000
Xxxxxxx Xxxxx Barney Inc. 50,000,000
Chase Securities Inc. 25,000,000
Commerzbanc Capital Markets 25,000,000
Corporation
Total:...................... $500,000,000
To: Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Warburg Dillon Read LLC
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000,
for themselves and as Representatives
of the several Underwriters
We accept the offer contained in your letter, dated
November 5, 1999, relating to $500,000,000 principal amount of
our 7-3/4% Debentures Due 2029. We also confirm that, to the
best of our knowledge after reasonable investigation, the
representations and warranties of the undersigned in the
Underwriting Agreement filed as an exhibit to the undersigned's
registration statements on Form S-3 (Nos. 33-43453 and 333-80757)
(the "Underwriting Agreement") are true and correct and no stop
order suspending the effectiveness of the Registration Statement
(as defined in the Underwriting Agreement) or any part thereof
has been issued and no proceedings for that purpose have been
instituted or, to the knowledge of the undersigned, are
contemplated by the Securities and Exchange Commission.
(Signature on following page)
(Signature to Terms Agreement Letter)
Dated: November 5, 1999 Very truly yours,
GEORGIA-PACIFIC CORPORATION
By: /S/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President and Treasurer
