Welcome to the Support Communities!
I would first suggest reading this document:Managing Media with Final Cut Pro X Libraries
Page 10 explains the new paradigm where Libraries are used to organize your media.
Libraries contain events, and the events now contain both projects and clips.
These important articles provide an overview and best practices for making this shift:Final Cut Pro X 10.1: How to back up important Final Cut Pro X 10.0.x files before updating
Here is the updated version of the online manual:
Final Cut Pro X Online User Guide:
Once you’ve reviewed all of this, you may determine that moving your existing files to an external drive and starting fresh on your internal drive with your most current project may be a good idea.Cheers,