Filed by Graphic Packaging International Corporation
pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12 under
the Securities and Exchange Act of 1934
Subject Company: Graphic Packaging International
Corporation
Commission File No. 333-104928
(GPC Logo)
Memorandum
To: Graphic Packaging Employees
From: Jeff Coors
Date: May 6, 2003
Subject: First Quarter Results
The first few months of this year have been very active.
Although our first quarter financial results, announced April 29,
2003, reflect the weakness in the economy and our industry, we
accomplished much to build our business.
Of particular significance is our progress in Six Sigma.
Overall, project cycle times for Black Belts is at 90 days with 6
replications completed at an average cycle time of 53 days. We
also trained over 100 Yellow Belts during the quarter and
finished training 14 Green Belt candidates. In addition, I am
also very pleased with the progress on accounts receivable. We
ended the quarter at a record 89.3% current. This is just shy of
our 90% goal, and it is a significant accomplishment.
With the signing of a new four-year agreement with Coors Brewing,
we have no major long-term customer contracts due for re-
negotiation until 2004. This reinforces the stability of our
customer base for the near term. Unfortunately, our food,
beverage and tobacco customers are experiencing soft demand for
their products, which accounts for the reduction in sales
compared to prior quarters. I am encouraged that our net new
business (new business gained less business lost) was positive
for the quarter. So as the economy rebounds, so should our
sales.
Another positive development was the acquisition in March of J.D.
Cahill Co., Inc. This adds two excellent laminating and coating
facilities to our operations and will greatly enhance our value-
added lamination business and strengthen our leadership in
barrier and strength packaging.
We also can be very proud that the Company has received
significant recognition by several major customers. This quarter
we received the "Spirit of Excellence" award from Hormel Foods.
For the first time in history a paperboard packaging company
received the gold level "Crown of Excellence" award from Philip
Morris. And we also received the "Outstanding Supplier of the
Year" award from Lorillard. Congratulations to all of you who
made these awards possible.
I am pleased that the labor dispute has settled in Kalamazoo,
with a large majority of the represented employees ratifying a
new 5-year contract on January 26. The mill and carton plant are
running well and we produced and sold considerably more
Pacesetter board in the first quarter this year than we did last
year. While PACE International continues to boycott our products
and those of our customers and thereby threaten your jobs, we
have seen no measurable market impact from their efforts.
Of course, the biggest news of the quarter was the announcement
of our intent to merge with Riverwood to form a premier global
paperboard packaging company. This new company will more than
double GPC's current size with leadership positions in beverage
and consumer product paperboard packaging. Opportunities to
offer our customers a broader range of products and capabilities
will help us serve them better going forward. We also believe
there are significant synergies in combining the two companies.
I would encourage anyone who would like to know more about the
details of the merger to read the merger agreement and the
registration statement that were filed with the Securities and
Exchange Commission. The documents are available on our website
in the investor relations section.
Graphic Packaging has been through major changes as we've grown
to be the largest and most successful folding carton producer.
Now comes more change, which is very exciting, yet can bring
stress and uncertainty. We must change to survive in the
competitive marketplace in which we do business. And, I believe
we will be much stronger for having gone through it. I
appreciate your continued efforts toward building an even
stronger company.
We are required to provide you the following information.
Additional Information
In connection with the proposed transaction, Riverwood filed a
Registration Statement on Form S-4 with the SEC containing a
preliminary proxy statement/prospectus of Graphic Packaging and
Riverwood and other relevant documents. INVESTORS ARE URGED TO
READ THE PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT
DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ON THE PROPOSED
TRANSACTION. Investors may obtain the preliminary proxy
statement/prospectus and other relevant documents filed with the
SEC free of charge at the SEC's website at www.sec.gov. In
addition, copies of the preliminary proxy statement/prospectus
and other documents filed by Graphic Packaging or Riverwood with
the SEC with respect to the proposed transaction may be obtained
free of charge by directing a request to either: Graphic
Packaging International Corporation, 4455 Table Mountain Drive,
Golden, Colorado 80403, Attention: Gard Edgarton, telephone:
1-877-608-2635, fax: 1-303-273-1571; or Riverwood International
Corporation, 3350 Riverwood Parkway, Suite 1400, Atlanta, Georgia
30339, Attention: Dan Blount, telephone: 1-770-644-3000, fax:
1-770-644-2935.
Participants in Solicitation
Graphic Packaging and Riverwood and their respective
directors and executive officers may be deemed to be participants
in the solicitation of proxies from Graphic Packaging's
shareholders in connection with the proposed transaction.
Information concerning Graphic Packaging's directors and
executive officers is set forth in Graphic Packaging's proxy
statement dated March 31, 2003, for the 2003 Annual Meeting of
Shareholders, filed by Graphic Packaging with the SEC.
Information concerning Riverwood's directors and executive
officers is set forth in the annual report on Form 10-K for the
year ended December 31, 2002 filed by Riverwood with the SEC.
Shareholders may obtain additional information regarding the
interests of such persons who may, under the rules of the SEC, be
considered to be participants in the solicitation of Graphic
Packaging's stockholders in connection with the proposed
transaction by reading the proxy statement/prospectus. INVESTORS
SHOULD READ THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT
DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE BEFORE MAKING ANY
VOTING OR INVESTMENT DECISION.