Exhibit (10)(h)

POTLATCH CORPORATION

BENEFITS PROTECTION TRUST AGREEMENT

As Amended and Restated Effective September 16, 2006

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POTLATCH CORPORATION

BENEFITS PROTECTION TRUST AGREEMENT

TABLE OF CONTENTS

 

SECTION 1.    Definitions    1 SECTION 2.    Creation of Trust; Contributions   
5 SECTION 3.    Payments from the Trust    6 SECTION 4.    Management of Trust
Assets    9 SECTION 5.    Powers of Trustee    10 SECTION 6.    Taxes, Expenses
and Compensation of Trustee    12 SECTION 7.    Records And Accounting    13
SECTION 8.    Indemnification    13 SECTION 9.    Administration of the Plans;
Communications    13 SECTION 10.    Resignation or Removal of Trustee    14
SECTION 11.    Amendment of Agreement; Termination of Trust    15 SECTION 12.   
Governing Law; Severability    16

 

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POTLATCH CORPORATION

BENEFITS PROTECTION TRUST AGREEMENT

As Amended and Restated Effective September 16, 2006

This amended and restated Trust Agreement, originally made as of the first day
of January, 1990, by and between POTLATCH CORPORATION, a Delaware corporation
(the “Corporation”) and U.S. Bank National Association (formerly First Trust
National Association) (the “Trustee”), and amended and restated to read as
follows effective September 16, 2006.

WITNESSETH:

Whereas the Corporation has adopted the nonqualified plans, programs and
policies and has entered into the contracts listed on Schedule 1 (collectively,
the “Plans”) and may adopt or enter into other such plans, programs, policies
and contracts which will be listed from time to time on Schedule 1; and

Whereas the Corporation’s obligations pursuant to the Plans are not funded or
otherwise secured and the Corporation desires to take steps to assure that,
subject to the claims of the Corporation’s general creditors, the future payment
of amounts under the Plans will not be improperly withheld in the event that a
Change of Control (as hereinafter defined) of the Corporation should occur;

Now, Therefore, the Corporation and the Trustee agree as follows:

SECTION 1. DEFINITIONS

(a) “Benefit Commitments” means:

(i) all benefits that are accrued or payable (whether on a current or deferred
basis) under the Plans as of the date of the Change of Control and

(ii) all benefits that may become payable under the Plans as in effect on the
date of the Change of Control as a result of termination of a participant’s
employment after such Change of Control, as described in Section 2(d).

 

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(b) “Change of Control” means:

(i) Upon consummation of a reorganization, merger or consolidation involving the
Corporation (a “Business Combination”), in each case, unless, following such
Business Combination,

(A) all or substantially all of the individuals and entities who were the
beneficial owners, respectively, of the then outstanding shares of common stock
of the Corporation (the “Outstanding Common Stock”) and the then outstanding
voting securities of the Corporation entitled to vote generally in the election
of directors (the “Outstanding Voting Securities”) immediately prior to such
Business Combination beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors of the corporation resulting from such
Business Combination (including, without limitation, a corporation which as a
result of such transaction owns the Corporation either directly or through one
or more subsidiaries),

(B) no Person (as defined in (iii) below) (excluding any corporation resulting
from such Business Combination or any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or such other corporation resulting
from such Business Combination) beneficially owns, directly or indirectly, 30%
or more of, respectively, the then outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined voting
power of the then outstanding voting securities of such corporation except to
the extent that such ownership is based on the beneficial ownership, directly or
indirectly, of Outstanding Common Stock or Outstanding Voting Securities
immediately prior to the Business Combination, and

(C) at least a majority of the members of the board of directors of the
corporation resulting from such Business Combination were members of the board
of directors of the Corporation (the “Board”) at the time of the execution of
the initial agreement, or of the action of the Board, providing for such
Business Combination; or

 

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(ii) On the date that individuals who, as of May 19, 2006 constitute the Board
(the “Incumbent Board”) cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a director
subsequent to May 19, 2006 whose election, or nomination for election by the
Corporation’s stockholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board should be considered as though
such individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors, an actual or threatened solicitation of proxies or
consents or any other actual or threatened action by, or on behalf of any Person
other than the Board; or

(iii) Upon the acquisition after May 19, 2006 by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 30% or more of either

(A) the then Outstanding Common Stock or

(B) the combined voting power of the Outstanding Voting Securities; provided,
however, that the following acquisitions shall not be deemed to be covered by
this subparagraph (iii):

(x) any acquisition of Outstanding Common Stock or Outstanding Voting Securities
by the Corporation,

(y) any acquisition of Outstanding Common Stock or Outstanding Voting Securities
by any employee benefit plan (or related trust) sponsored or maintained by the
Corporation, or

(z) any acquisition of Outstanding Common Stock Outstanding Voting Securities by
any corporation pursuant to a transaction which complies with clauses (A),
(B) and (C) of Subsection I(b)(i) of this Agreement, or

 

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(iv) Upon the consummation of the sale of all or substantially all of the assets
of the Corporation or approval by the stockholders of the Corporation of a
complete liquidation or dissolution of the Corporation.

(c) “Corporation” means Potlatch Corporation, a Delaware corporation, and its
successor and assigns.

(d) “Independent Administrator” means an independent professional benefits
consulting or administrative firm appointed pursuant to Section 3(b).

(e) “Insolvent” means that the company is unable to pay its debts as they mature
or is subject to a pending proceeding as a debtor under the Bankruptcy Code.

(f) “Participants” mean the active and former directors and employees of the
Corporation or its subsidiaries or affiliates who are entitled to benefits under
the Plans.

(g) “Plans” mean the nonqualified plans, programs, policies and contracts listed
on Schedule 1 adopted or maintained by the Corporation or a subsidiary or
affiliate of the Corporation. The Corporation may from time to time add to or
delete items from Schedule 1 by notifying the Trustee in writing; provided,
however, that no such change to Schedule 1 may be made after a Change of Control
has occurred. The Corporation shall provide the Trustee with a current copy of
each Plan and any amendments thereto.

(h) “Trust” means the Potlatch Corporation Benefits Protection Trust established
pursuant to this Agreement.

(i) “Trustee” means U.S. Bank National Association, or any successor trustee
appointed pursuant to Section 10.

(j) “Trust Fund” means all moneys, securities and other property held by the
Trustee under the Trust.

 

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SECTION 2. CREATION OF TRUST; CONTRIBUTIONS

(a) Concurrently with the execution of this Agreement, the Corporation deposited
with the Trustee $100 in cash. From time to time the Corporation shall also
deposit with the Trustee such contributions as may be permitted or required
pursuant to Sections 2(c) and 2(d) of this Agreement. All such contributions and
all accumulations and accruals, and the earnings and income with respect
thereto, shall be held by the Trustee in trust pursuant to this Agreement and
shall be invested, reinvested and applied as provided herein. The Trustee hereby
accepts being named as Trustee under this Agreement and agrees to hold the Trust
Fund subject to all of the terms and conditions hereof.

(b) The Trust established hereunder shall be revocable by the Corporation at any
time before a Change of Control, but shall be irrevocable upon and after a
Change of Control. The Trust is intended at all times to be a grantor trust as
described in section 671 of the Internal Revenue Code of 1986, as amended, and
all income earned on the assets of the Trust Fund shall be taxable to the
Corporation, whether before or after the Trust becomes irrevocable. All taxes
with respect to the Trust shall be payable by the Corporation from its separate
funds and shall not be charged against the Trust Fund.

(c) The Corporation, with the concurrence of the Trustee, may at any time
deposit with the Trustee cash or marketable securities to be credited to the
Trust Fund.

(d) Within 30 days after a Change of Control has occurred, the Corporation shall
deposit with the Trustee cash or marketable securities (other than stock or debt
obligations of the Corporation) to be credited to the Trust Fund in an amount
which, when added to any funds already credited to the Trust Fund, the
Corporation reasonably determines will be at least sufficient to pay:

(i) the Benefit Commitments, and

(ii) all anticipated future expenses of the Trust Fund, including the fees and
expenses of the Trustee described in Section 6(b).

 

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(e) At least annually after a Change of Control, the Independent Administrator
shall retain an actuary to re-determine the amount determined pursuant to
(d) above. Such re-determination shall be performed using the factors and
assumptions set forth in Schedule 2. If the current fair market value of the
assets of the Trust Fund does not equal or exceed 110% of the amount so
re-determined, the Independent Administrator shall so advise the Corporation and
the Corporation shall, within 30 days after receiving such notice, make an
irrevocable contribution to the Trust equal to the excess of the re-determined
amount over the current fair market value of the assets of the Trust Fund.

(f) The Trustee shall not be responsible for the computation or collection of
any contribution to the Trust Fund.

SECTION 3. PAYMENTS FROM THE TRUST

(a) Upon the effective date of this Agreement, the Corporation shall furnish the
Trustee with written information regarding the Participants and their
beneficiaries under the Plans and the dates of distribution and amounts of
benefits under the Plans and shall update such information on a regular basis.

(b) The Corporation shall have the duty to notify the Trustee if a Change of
Control occurs. If the Corporation fails to provide such notice and the Trustee
has a reasonable basis for believing that a Change of Control has occurred, then
the Trustee shall be authorized to act under this section as if the Corporation
had provided such notice. After a Change of Control, the Corporation shall:
(i) within 30 days furnish to the Trustee the information described in (a) above
with respect to the Benefit Commitments which are then payable under the Plans;
(ii) update such information with respect to all Plans not less frequently than
annually; (iii) furnish the Trustee with any other information the Trustee may
reasonably request within 30 days after such request; and (iv) within 30 days
following the Change of Control, appoint an Independent Administrator which
shall assume responsibility for the administration of the Plans and provide such
information and assistance as may be necessary or appropriate to assist the
Independent Administrator to carry out its duties in connection with the Plans.

 

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(c) Before a Change of Control, the Trustee shall make payments from the Trust
Fund to Participants and their beneficiaries under the Plans if so directed by
the Corporation. The Corporation may withdraw funds from the Trust Fund for any
purpose at any time before a Change of Control.

(d) After a Change of Control the Trustee shall pay the Benefit Commitments to
the Participants and their beneficiaries in the amounts and at the time directed
by the Independent Administrator.

(e) Except as provided in Section 2(d) or Section 11(d), no funds shall be paid
to the Corporation after a Change of Control unless the Trustee determines in
its sole discretion that the funds will never be required to pay Benefit
Commitments under the Plans and expenses of the Trust Fund and the Independent
Administrator.

(f) After a Change of Control the Trustee shall pay benefits (including, without
limitation, benefits accruing on account of services rendered after the date of
the applicable event or on account of a period of employment after the
applicable event) under the Plans in excess of the Benefit Commitments only if
the Corporation deposits additional cash or marketable securities sufficient to
pay such excess benefits or the Trustee determines in its sole discretion that
the Trust Fund is sufficient to pay all Benefit Commitments, expenses of the
Trust Fund and such excess benefits, and the Corporation agrees in writing that
it will not make a request pursuant to Section 3(e) prior to the termination of
the Trust that the Trustee make a distribution of funds in excess of the amount
necessary to pay the Benefit Commitments and Trust Fund expenses.

(g) Payments to Participants and their beneficiaries pursuant to Sections 3(c)
and 3(d) shall be made by the Trustee to the extent that funds in the Trust Fund
are sufficient for such purpose. In any month in which the Trustee determines
that the Trust Fund does not have sufficient funds to provide for the payment of
all benefits due in such month under the Plans, the amount otherwise payable to
each such Participant or beneficiary during such month shall be reduced
proportionately; provided, however, that after a Change of Control any payments
in excess of the Benefit Commitments shall be reduced as necessary or completely
terminated before payment of any Benefit Commitments shall be reduced.

 

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(h) Notwithstanding any other provisions of this Agreement, if before or after a
Change of Control the Trustee is notified by the Corporation or the Trustee has
a reasonable basis for believing that the Corporation is Insolvent, the Trustee
shall discontinue benefit payments from the Trust Fund and shall hold the assets
of the Trust Fund to satisfy the claims of the Corporation’s general and
judgment creditors. For this purpose, the knowledge of any of its affiliates
shall not be imputed to the Trustee. The Trustee shall resume benefit payments
only after determining that the Corporation is not Insolvent or as directed by a
court of competent jurisdiction.

(i) The Corporation shall have the duty to notify the Trustee if the Corporation
becomes Insolvent. Except as provided in the next sentence, the Trustee shall
have no duty to inquire whether the Corporation is Insolvent. If a person
claiming to be a creditor of the Corporation alleges in writing to the Trustee
that the Corporation is Insolvent, the Trustee shall independently determine or,
within 30 days after receipt of such notice, shall petition a court to determine
whether the Corporation is Insolvent and shall suspend benefit payments pending
such determination. The Corporation shall promptly provide all information
reasonably requested by the Trustee to enable the Trustee or the court to make
such determination.

(j) If the Trustee discontinues or suspends benefit payments under Section 3(h)
or 3(i) and subsequently resumes such payments, the first payment following such
discontinuance or suspension shall include the aggregate amount of all payments
that would have been made during the period of discontinuance or suspension,
less any payments made by the Corporation to the Participant or beneficiary
pursuant to the Plans during such period, together with interest equal to 70% of
the prime rate at large U.S. money center commercial banks as reported in the
Wall Street Journal from time to time throughout such period.

(k) No Participant or beneficiary shall have any claim on or beneficial
ownership interest in any assets of the Trust Fund before such assets are paid
to the Participant or beneficiary, and all rights created under the Plans shall
be unsecured contractual rights against the Corporation.

 

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SECTION 4. MANAGEMENT OF TRUST ASSETS

(a) Prior to a Change of Control, the Trust Fund shall be held, invested and
reinvested by the Trustee as directed in writing by the Corporation from time to
time.

(b) After a Change of Control, the Trustee shall have exclusive authority and
discretion to manage and control the Trust Fund and may employ investment
managers (including affiliates of the Trustee) to manage the investment of the
Trust Fund. In exercising such authority and discretion, the Trustee shall be
guided by the investment policy guidelines established by the Corporation for
this purpose.

The Trustee shall discharge its investment duties with the care, skill, prudence
and diligence under the circumstances then prevailing that a prudent person
acting in a like capacity and familiar with such matters would use in the
conduct of an enterprise of a like character and with like aims.

(c) In no event shall assets of the Trust Fund be invested in debt obligations
of the Corporation.

(d) To the fullest extent permitted by law, the Trustee is expressly authorized
to:

(i) retain the services of a registered broker-dealer organization hereafter
affiliated with U.S. Bank National Association, and any future successors in
interest thereto (collectively for the purposes of this paragraph referred to as
the “Affiliated Entities”), to provide services to assist in or facilitate the
purchase or sale of investment securities in the Trust,

(ii) acquire as assets of the Trust shares of mutual funds to which Affiliated
Entities provides, for a fee, services in any capacity and

(iii) acquire in the Trust any other services or products of any kind or nature
from the Affiliated Entities regardless of whether the same or similar services
or products are available from other institutions.

 

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The Trust may directly or indirectly (through mutual funds fees and charges, for
example) pay management fees, transaction fees and other commissions to the
Affiliated Entities for the services or products provided to the Trust and such
mutual funds at such Affiliated Entities’ standard or published rates without
offset (unless required by law) from any fees charged by the Trustee for its
services as Trustee.

The Trustee may also deal directly with the Affiliated Entities regardless of
the capacity in which it is then acting, to purchase, sell, exchange or transfer
assets of the Trust even though the Affiliated Entities are receiving
compensation or otherwise profiting from such transaction or are acting as a
principal in such transaction.

(e) Each of the Affiliated Entities is authorized to

(i) effect transactions on national securities exchanges for the Trust as
directed by the Trustee, and

(ii) retain any transactional fees related thereto, consistent with
Section 11(a)(1) of the Exchange Act, as amended, and related Rule 11a2-2(T).

(iii) Included specifically, but not by way of limitation, in the transactions
authorized by this provision are transactions in which any of the Affiliated
Entities are serving as an underwriter or member of an underwriting syndicate
for a security being purchased or are purchasing or selling a security for its
own account. In the event the Trustee is directed by the Corporation or any
designated investment manager, as applicable hereunder (collectively referred to
for purposes of this paragraph as the “Directing Party”), the Directing Party
shall be authorized, and expressly retains the right hereunder, to direct the
Trustee to retain the services of, and conduct transactions with, Affiliated
Entities fully in the manner described above.

SECTION 5. POWERS OF TRUSTEE

Subject to Sections 3 and 4, the Trustee shall have full power and authority
with respect to any and all moneys, securities and other property at any time
received or held in the Trust Fund to do all such acts, take all such
proceedings and exercise all such rights and privileges,

 

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whether herein specifically referred to or not, as could be done, taken or
exercised by the absolute owner thereof, including, without in any way limiting
the generality of the foregoing, the following:

(a) To collect and receive the income of the Trust Fund and to invest and
reinvest the Trust Fund in investments of any kind;

(b) To pay the expenses of the Trust (excluding any taxes payable by the
Corporation under Section 2(b)) out of the Trust Fund, including the fees and
reasonable expenses of the Independent Administrator and including reasonable
compensation for its services as Trustee (if and to the extent that the
Corporation does not pay such expenses and compensation);

(c) To employ suitable agents and counsel, and pay their reasonable expenses and
compensation out of the Trust Fund (if and to the extent that the Corporation
does not pay such expenses and compensation);

(d) To sell, convey, exchange or otherwise dispose of any property at any time
held in trust hereunder;

(e) To hold uninvested any cash contributions to the Trust Fund and to create
reserves of cash or other assets of the Trust Fund in the banking department of
any affiliate of the Trustee, without liability for interest thereon, for the
payment of expenses, or for distributions pursuant to the Plans, or for any
other purpose in connection with the Plans, notwithstanding the affiliate’s
receipt of “float” from such uninvested cash;

(f) To deposit any moneys at any time held in the Trust Fund in any savings
bank, in the savings department of any bank or in a banking affiliate of the
Trustee;

(g) To invest assets of the Trust Fund in any mutual funds advised by the
Trustee or any of its affiliates or for which an affiliate of the Trustee acts
as a custodian or other service provider and to receive management fees from
such mutual funds for services performed for such funds;

(h) To have, respecting bonds, shares of corporate stock and other securities,
all the rights, powers and privileges of an owner, including holding securities
in the name of the Trustee

 

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or in the name of a nominee securities depository with or without disclosure of
the Trust, voting any corporate stock either in person or by proxy, with or
without power of substitution, making payment of calls, assessments or other
sums deemed by the Trustee expedient for the protection of the Trust Fund,
exchanging securities, selling or exercising stock subscriptions or conversion
rights, participating in foreclosures, reorganizations, consolidations, mergers,
liquidations, pooling agreements, voting trusts, and assenting to corporate
sales, leases and encumbrances. The Trustee may provide to the Corporation (or,
after a Change of Control, to the Independent Administrator) the proxy of any
security when in the Trustee’s judgment the Trustee or one of its affiliates may
have a conflict of interest;

(i) To enter into any contracts with, or purchase any annuities from, any
insurance company or insurance companies for the purpose of providing for
distributions under the Plans; and

(j) To settle, compromise or submit to arbitration any claims, debts or damages
due or owing to or from the Trust or the Trust Fund; to commence or defend legal
proceedings for or against the Trust; and to represent the Trust in all
proceedings in any court of law or equity or before any other body or tribunal.

SECTION 6. TAXES, EXPENSES AND COMPENSATION OF TRUSTEE

(a) The Corporation shall pay any federal, state, local or other taxes imposed
with respect to the assets or income of the Trust Fund. At the direction of the
Corporation (or, following a Change of Control, at the direction of the
Independent Administrator), the Trustee shall deduct any payroll or income taxes
required to be withheld from any payments made to Participants or their
beneficiaries from the Trust Fund.

(b) The fees and expenses of the Trustee may be revised from time to time as
agreed to by the parties. The Trustee’s reasonable expenses, including but not
limited to the retention of legal counsel, accountants and actuaries and such
other professionals as the Trustee determines are necessary or appropriate to
enable it to perform its services as Trustee, shall be charged to and payable
from the Trust Fund on a monthly basis, or on such other basis as the Trustee
deems reasonable, except to the extent that such fees and expenses are paid by
the Corporation.

 

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SECTION 7. RECORDS AND ACCOUNTING

(a) The Trustee shall keep accurate and detailed records and accounts with
respect to all assets included in the Trust Fund and all investments, receipts
and disbursements and other transactions involving the Trust, except that the
Corporation shall maintain all accounts for Participants and their beneficiaries
as provided in the Plans. All accounts, books and records maintained by the
Trustee shall be open to inspection by any person designated by the Corporation
at all reasonable times.

(b) Within 60 days following the close of each calendar year or the date of
removal or resignation of the Trustee or termination of the Trust, the Trustee
shall file with the Corporation a written report setting forth all investments,
receipts, disbursements and other transactions effected by it during the
calendar year or part thereof for which the report is filed, in such form as the
Corporation and the Trustee shall agree. The Trustee also shall render such
additional statements or reports to the Corporation as the Corporation may
reasonably request from time to time.

SECTION 8. INDEMNIFICATION

The Corporation shall indemnify and hold the Trustee harmless from and against
any liability that the Trustee may incur in the administration of the Trust
(including reasonable attorneys’ fees), unless arising from the Trustee’s own
gross negligence, willful misconduct, or willful breach of the provisions of or
its obligations under this Agreement. The Trustee shall not be required to give
any bond or any other security for the faithful performance of its duties under
this trust agreement, except as required by law.

SECTION 9. ADMINISTRATION OF THE PLANS; COMMUNICATIONS

(a) The Corporation shall administer the Plans as provided therein and subject
to Section 3(d), the Trustee shall not be responsible in any respect for
administering the Plans. The Trustee shall not be responsible for the adequacy
of the Trust Fund to meet and discharge all payments and liabilities under the
Plans.

 

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(b) Any action of the Corporation, or if applicable, the Independent
Administrator under any provision of this Agreement shall be evidenced by a
written instrument signed by an authorized agent of the Corporation or if
applicable, the Independent Administrator. The Corporation, or if applicable,
the Independent Administrator shall furnish the Trustee from time to time with
evidence satisfactory to the Trustee as to the agents authorized to sign such
instruments.

SECTION 10. RESIGNATION OR REMOVAL OF TRUSTEE

(a) The Trustee may resign at any time and for any reason before a Change of
Control upon written notice to the Corporation. After receipt of such written
notice, the Corporation shall appoint a successor trustee that will become
Trustee upon its acceptance of the Trust. The Trustee’s resignation shall become
effective upon the earlier of the date six months after such written notice is
provided or the date the successor trustee is appointed by the Corporation and
accepts the Trust. The Trustee shall have no duty to find or secure the
appointment of a successor upon its resignation pursuant to this Section 10(a).

(b) After a Change of Control, the Trustee may resign at any time and for any
reason upon written notice to the Corporation, and, if applicable, the
Independent Administrator. Such resignation shall become effective only if:

(i) The Trustee has obtained the agreement of a bank to act as successor trustee
which bank (A) is among the 100 largest banks in the United States, as measured
by deposits, (B) has a rating of “B/C” or greater based upon the most current
rating from Keefe, Bruyett & Woods (“KB&W’) or its successor, or if KB&W or its
successor should cease to publish ratings, then a short-term debt rating from
Moody’s of “P-1” or greater, or from Standard and Poor’s of “A-1” and (C) has no
present commercial banking relationship with the Corporation or any of its
subsidiaries, affiliates or successors; or

(ii) A court of competent jurisdiction has appointed a successor trustee, but
only after the Trustee has used its best efforts to find a successor pursuant to
(i) above.

The Trustee shall continue to be trustee of the Trust Fund until the new trustee
is in place, and the Trustee shall be entitled to expenses and fees (including
expenses incurred in finding a

 

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successor trustee or petitioning a court to name a successor trustee) through
the later of the effective date of its resignation as Trustee or the end of its
custodianship of the Trust Fund.

(c) Prior to a Change of Control, the Corporation may remove the Trustee upon 30
days written notice to the Trustee, or upon such shorter period as is acceptable
to the Trustee. Such removal shall become effective, however, only upon the
occurrence of all of the following events:

(i) The appointment by the Corporation of a successor trustee;

(ii) The acceptance of the Trust by the successor trustee; and

(iii) The delivery of the Trust Fund to the successor trustee.

(d) Following a Change of Control, the Independent Administrator, if it agrees
to assume such power and responsibility, may remove the Trustee by following the
steps prescribed for the Corporation in (c) above.

(e) Upon designation or appointment of a successor trustee, the Trustee shall
transfer the Trust Fund to the successor trustee reserving such reasonable sums
as the Trustee shall deem necessary to defray its expenses in settling its
accounts and to pay any of its compensation due and unpaid. If the sums so
reserved are not sufficient for these purposes, the Trustee shall be entitled to
recover the amount of any deficiency from either the Corporation or the Trust
Fund held by the successor trustee, or both.

SECTION 11. AMENDMENT OF AGREEMENT; TERMINATION OF TRUST

(a) The Corporation shall have the right at any time prior to a Change of
Control to amend this Agreement by an instrument in writing duly executed and
delivered to the Trustee, or to terminate the Trust; provided, however, that the
duties, powers and liabilities of the Trustee hereunder shall not be
substantially changed without its written consent.

(b) The provisions of this Agreement and the Trust created hereby may not be
amended or terminated by the Corporation after a Change of Control. The Trustee,
after a

 

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Change of Control, may amend the provisions of this Agreement to the extent
required by applicable law.

(c) In the event the Corporation terminates the Trust prior to the occurrence of
a Change of Control, the Trustee shall reserve such sums as it deems necessary
to pay its fees and expenses, and shall distribute all remaining assets of the
Trust Fund in accordance with the written directions of the Corporation.

(d) The Trust shall be terminated upon the earlier of the exhaustion of the
Trust Fund or the final payment of all amounts payable to all of the
Participants and their beneficiaries pursuant to the Plans, and the payment of
all amounts due to the Trustee and all costs and expenses chargeable to the
Trust. Promptly upon termination of this Trust, and after payment of all fees,
expenses and indemnities due to or incurred by the Trustee hereunder, any
remaining portion of the Trust Fund shall be paid to the Corporation.

SECTION 12. GOVERNING LAW; SEVERABILITY

(a) This Agreement shall be construed and enforced in accordance with the laws
of the State of Washington.

(b) Any provision of this Agreement that is determined to be invalid or
unenforceable shall be ineffective without invalidating the remaining provisions
hereof.

(c) This Agreement shall have binding effect on the successors and assigns of
the Corporation and on all parent and subsidiary companies related to any such
successor or assign.

 

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IN WITNESS WHEREOF, the parties hereto have caused this amended and restated
Agreement to be executed by their duly authorized officers as of the day and
year first above written.

 

POTLATCH CORPORATION By:   /s/ Gerald L. Zuehlke  

G. L. Zuehlke

Vice President and Chief Financial Officer

POTLATCH CORPORATION

 

By:   /s/ Jenni Hogaboom   US BANK NATIONAL ASSOCIATION

 

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Schedule 1

The Plans

Potlatch Forest Products Corporation Salaried Employees’ Supplemental Benefit
Plan

Potlatch Forest Products Corporation Salaried Employees’ Supplemental Benefit
Plan II

Potlatch Corporation Management Performance Award Plan

Potlatch Corporation Management Performance Award Plan II

Potlatch Forest Products Corporation Severance Program for Executive Employees

Potlatch Corporation Directors Deferred Compensation Plan

Potlatch Corporation Directors Deferred Compensation Plan II

Potlatch Corporation Directors Retirement Plan (frozen)

Potlatch Forest Products Corporation Employee Severance Plan*

Supplemental Retirement Benefit and Life Insurance Agreement Between Potlatch
Corporation and Richard B. Madden dated as of February 19, 1988

Deferred Compensation Agreement Between Potlatch Corporation and Richard N.
Congreve dated as of December 2, 1982, as amended

Severance and/or Employment Agreements:

Akerman, Jr., Emory S.

Bacon, John W.

Beech, John M.

Biazzo, Thomas A.

Black, Douglas L.

Brenner, Richard J.

Bullard, Richard W.

Cheek, George C.

Clark, Kenneth L.

Collier, James L.

Congreve, Richard N.

Covey, Michael J.

Davis, Brian W.

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* The contributions made to the Trust Fund by the Corporation with respect to
the Employee Severance Plan shall be held in a separate sub-account and the
provisions of Section 3 shall apply separately to such sub-account.

 

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Davisson, Ralph M.

DeBorde, Robert M.

Deward, Carl

Durand, Daniel J

Fleshman, Nancy (survivor of James Fleshman)

Grove, Gail (survivor of Harry Grove)

Hanby, Jr, John E.

Hedden, Helen

Hawley Jr, Robert J.

Kosloski, Ervin D.

Krantz, Irwin W.

Madden, Richard B.

Martin, F. Lynn

McAdoo, James C.

Morrison, John D.

Morton, G. William

Mull, Pamela A.

Norha, Patrick R.

Page, Gordon R.

Palkie, Thomas G.

Powell, Sandra T.

Robison, John G.

Rosenbaum, Lester G.

Ryerse, Malcolm A.

Smrekar, Thomas J.

Stinnett, Brent L.

Tate, Terry H.

Warner, Richard V.

Wolhaupter, John

 

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Schedule 2

Summary of Funding Methods and Assumptions for

Severance Contracts, Employment Agreements and

Supplement Defined Benefit Plan

Discount Rate

Discount rate will be determined using the discount rate to determine Potlatch
Forest Products Corporation Salaried Employees Retirement Plan benefits for the
fiscal year in which a Change of Control occurs.

Termination and Retirement

All active participants terminate two years after the valuation date, or
immediately, if that produces a higher liability. Benefit payments begin at the
earliest retirement date following termination.

Mortality

No mortality before retirement. Post-retirement mortality using RP-2000
mortality table.

Trust Expenses

5% of liabilities.

 

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