Exhibit 10.2

 

Execution Version

 

Pursuant to Item 601(b)(10)(iv) of Regulation S-K, certain identified
information marked with [***] has been excluded from the exhibit because it is
both (i) not material and (ii) would be competitively harmful if publicly
disclosed

 

AMENDED AND RESTATED ASSET Management Agreement

 

This AMENDED AND RESTATED ASSET MANAGEMENT AGREEMENT (as amended or restated
from time to time, including all appendixes and exhibits thereto, this
“Agreement”), dated as of June 24, 2020 (the “Amendment Effective Date”), by and
between Creek Pine REIT, LLC, a Delaware limited liability company (the
“Company”), Crown Pine Realty 1, Inc., a Delaware corporation (“CPR1”), and
CatchMark TRS Creek Management, LLC, a Delaware limited liability company (the
“Asset Manager”). The Company, CPR1 and the Asset Manager are each referred to
herein as a “Party” and collectively as the “Parties.”

RECITALS

 

WHEREAS, the Parties hereto are parties to that certain Asset Management
Agreement dated as of July 6, 2018, as amended by the First Amendment thereto,
effective as of February 25, 2019 (the “Original AMA”), and the parties to the
Original Agreement desire to amend and restate the Original AMA on the terms and
conditions herein in connection with the amendment of the Second Amended and
Restated Sawtimber Supply Agreement by and between Georgia-Pacific WFS, LLC and
CPR1;

 

WHEREAS, the Company intends to continue to be taxed as a REIT (as hereinafter
defined) for federal income tax purposes;

 

WHEREAS, the Company shall continue to cause CPR1 to undertake certain
activities the income from which would not (or the activities of which would
cause any rents not to) be treated with respect to the Company as “qualifying
income” (within the meaning of Section 856(c) of the Code); and

 

WHEREAS, CPR1 and the Company desire that the Asset Manager provide such
services to the Company and its Subsidiaries (including CPR1) as are set forth
herein, and the Asset Manager desires to render such services in consideration
of the compensation provided for herein.

 

NOW, THEREFORE, in consideration of the mutual agreements set forth herein, and
other good and valuable consideration, the Parties agree to amend and restate
the Original AMA as of the Amendment Effective Date as follows:

 

1.             Defined Terms. Defined terms used in this Agreement shall, unless
the context otherwise requires, have the meanings specified in this Section 1
or, if not so specified, shall have the meanings given to such defined terms in
the Company LLC Agreement.

 

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(a)          “Affiliate” means, in relation to a Person, any holding company,
subsidiary or any other subsidiaries of any such holding company, in each case
of such Person and any Person that Controls, is Controlled by or is under common
Control with such Person.

 

(b)            “Agreement” shall have the meaning set forth in the Preamble.

 

(c)            “Allowable Variance” shall have the meaning set forth in Section
3(b).

 

(d)            “Alternative Voting System” shall have the meaning ascribed to
such term in the Company LLC Agreement.

 

(e)            “Amendment Effective Date” shall have the meaning set forth in
the Preamble.

 

(f)             “Annual Budget” shall have the meaning set forth in Section
3(a).

 

(g)           “Annual Harvest Schedule” shall have the meaning set forth on
Schedule B-2.

 

(h)           “Applicable Rate” shall have the meaning set forth in Section
9(a).

 

(i)            “Asset Management Fee” shall have the meaning set forth in
Section 9(a).

 

(j)            “Asset Manager” shall have the meaning set forth in the Preamble.

 

(k)          “Bad Act” means, with respect to a Person, (i) gross negligence,
(ii) bad faith, (iii) fraud, or (iv) willful misconduct; provided, that, other
than with respect to fraud, if the applicable action or circumstance is curable,
then the breaching party will not be deemed to have caused the occurrence of a
Bad Act pursuant to this definition if such party cures the applicable action or
circumstance (including, for the avoidance of doubt, paying or otherwise
remedying any adverse effects resulting from the Bad Act and otherwise
offsetting any Losses suffered by other relevant Persons) within the thirty (30)
days following the receipt of written notice thereof. For the avoidance of
doubt, for purposes of Section 11(c), any Loss in respect of or arising from an
act by the Asset Manager as a fiduciary under the Employee Retirement Income
Security Act of 1974, as amended, and the regulations thereunder shall not
constitute a “Bad Act.”

 

(l)            “Bankruptcy” shall have the meaning ascribed to such term in the
Company LLC Agreement.

 

(m)          “Base Amount” means $1,524,000,000.

 

(n)           “Beginning Preferred Partner Ratio” shall mean the number equal to
(x) the aggregate amount of all Capital Contributions (as such term is defined
in the Parent LP Agreement) made by the Preferred Partners in accordance with
the Parent LP Agreement as of the Effective Date, divided by (y) the aggregate
amount of all Capital Contributions made by all Partners in accordance with the
Parent LP Agreement as of the Effective Date.

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(o)           “Budget Development Protocols” shall have the meaning set forth in
Section 3(a).

 

(p)           “Budget Impasse” shall have the meaning set forth in Section 3(c).

 

(q)            “Business Assets” shall have the meaning ascribed to such term in
the Company LLC Agreement.

 

(r)            “Business Day” shall have the meaning ascribed to such term in
the Company LLC Agreement.

 

(s)           “Capital Contribution” shall have the meaning ascribed to such
term in the Parent LP Agreement.

 

(t)            “Cause” shall mean any of the following:

 

(i)             there has been a final determination by a court of competent
jurisdiction, or an admission by the Asset Manager or any of its Affiliates,
that the Asset Manager or any of its Affiliates has committed, in connection
with the performance of the Asset Manager’s duties under this Agreement, (1)
fraud or intentional misappropriation of funds, (2) willful misconduct, (3)
gross negligence, or (4) a breach of this Agreement resulting in material Losses
to the Parent, the Company or any of its Subsidiaries, taken as a whole;
provided, that, such an occurrence shall not constitute “Cause” to the extent
(1) the act or omission is the result of the conduct of an employee of the Asset
Manager or its Affiliates who is not otherwise a Senior Officer, (2) such
conduct occurs without the prior knowledge of a Senior Officer or (3) such
“Cause” event is cured within thirty (30) days, which cure may include: (x) the
removal of the subject employee from the Asset Manager or the applicable
Affiliate, as applicable; (y) a comprehensive review by the Asset Manager or the
applicable Affiliate of its internal policies and procedures to determine
whether additional procedures should be implemented in order to prevent such act
or event by the Asset Manager (or such Affiliate thereof); and (z) full
restitution and reimbursement is made to the Parent, the Company or the
applicable Subsidiary, or to the Preferred Partners, as applicable, by the Asset
Manager, for any Losses caused by such Cause event;

 

(ii)            a Transfer by the General Partner or any of its Affiliates in
contravention of the Parent LP Agreement that is not cured within thirty (30)
days after the earlier of (x) the General Partner (or CTT Partner (as such term
is defined in the Parent LP Agreement)) becoming aware of such Transfer or (y)
written notice from a Partner specifying the breach;

 

(iii)           the Asset Manager has failed to retain certification by or to
obtain recertification from Sustainable Forestry Initiative Inc. with respect to
all of the Property; or;

 

(iv)           the Bankruptcy of (i) the Asset Manager or (ii) CTT, CatchMark
Timber Operating Partnership, L.P., or any Affiliate thereof that directly holds
equity interests in Parent.

 

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(u)          “Change of Control” shall mean any transaction or series of related
transactions which directly or indirectly results in:

 

(i)              the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended
(“Exchange Act”)) of direct or indirect beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of fifty percent (50%) or more
of either the then-outstanding shares of common stock of CTT or the Asset
Manager or the combined voting power of any other then-outstanding securities of
CTT or the Asset Manager entitled to vote generally in the election of directors
(as applicable with respect to CTT or the Asset Manager, the “Outstanding Voting
Securities”); or

 

(ii)            any merger, consolidation, reorganization or other similar
transaction pursuant to which CTT or the Asset Manager is merged with and into
or otherwise acquired by another entity; excluding, however, any such
transaction pursuant to which the individuals and entities who are beneficial
owners of the applicable entity’s Outstanding Voting Securities immediately
prior to such transaction will in the aggregate beneficially own, directly or
indirectly, fifty percent (50%) or more of the outstanding shares of common
stock, and the combined voting power of the then-outstanding securities entitled
to vote generally in the election of directors, as the case may be, of the
corporation resulting from such transaction (including a corporation that as a
result of such transaction owns CTT or the Asset Manager, as applicable, or all
or substantially all of the assets of CTT or the Asset Manager, as applicable,
either directly or through one or more subsidiaries).

 

(v)            “Closing” shall have the meaning ascribed to such term in the
Parent LP Agreement.

 

(w)           “Code” shall mean the Internal Revenue Code of 1986, as amended.

 

(x)           “Company” shall have the meaning set forth in the Preamble.

 

(y)           “Company Account” shall have the meaning set forth in Section 7.

 

(z)           “Company Board” shall mean the board of managers of the Company,
as established and maintained pursuant to the Company LLC Agreement.

 

(aa)         “Company LLC Agreement” means the Amended and Restated Limited
Liability Company Agreement of the Company (as amended or restated from time to
time, including all appendixes and exhibits thereto).

 

(bb)         “Confidential Information” shall have the meaning set forth in
Section 8(b).

 

(cc)         “Constituent Members” means any Person that is an officer,
director, member, partner or shareholder in a Person, or any Person that,
indirectly through one or more limited liability companies, partnerships or
other entities, is an officer, director, member, partner or shareholder in a
Person.

 

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(dd)        “Control” means, in relation to a Person, where a person (or persons
acting in concert) holds or has direct or indirect control of (i) the affairs of
that Person, (ii) more than fifty percent (50%) of the total voting rights
conferred by all the issued shares in the capital of that Person which are
ordinarily exercisable in a general meeting (or the equivalent) or (iii) a
majority of the board of directors/managers of that Person, and “Controlled by”
shall be construed accordingly. For these purposes, “persons acting in concert,”
in relation to a Person, are persons which actively cooperate pursuant to an
agreement or understanding (whether formal or informal), with a view to
exercising, obtaining or consolidating Control of that Person.

 

(ee)         “CPR1” shall have the meaning set forth in the Preamble.

 

(ff)           “CTT” shall mean CatchMark Timber Trust, Inc.

 

(gg)         “Deferred Asset Management Fees” shall have the meaning ascribed to
such term in the Company LLC Agreement.

 

(hh)         “Effective Date” means July 6, 2018.

 

(ii)           “Excluded Loss” means (a) any Losses to the extent the same are
reimbursed by insurance proceeds or indemnities from third parties and (b) any
consequential, special, punitive or exemplary damages to the extent such damages
are not owed to a third party in connection with any third-party claim.

 

(jj)           “Expenses” shall have the meaning set forth in Section 10(a)

 

(kk)        “Fiscal Quarter” shall have the meaning ascribed to such term in the
Company LLC Agreement.

 

(ll)           “Fiscal Year” shall have the meaning ascribed to such term in the
Company LLC Agreement.

 

(mm)       “General Partner” shall have the meaning ascribed to such term in the
Parent LP Agreement.

 

(nn)         “Government Authority” means (i) a federal or national government,
any state government, any political subdivision thereof, or any local
jurisdiction therein; (ii) an instrumentality, board, commission, court or
agency, whether civilian or military, of any of the above, however constituted;
(iii) a public organization, being an organization whose members are (A)
countries or territories; (B) governments of countries or territories; and/or
(C) other public international organizations and includes the World Bank, the
United Nations, the International Monetary Fund and the OECD; or (iv) any
company, association, organization, business, enterprise or other entity which
is owned, whether in whole or in part, or controlled by any person listed in (i)
to (iii) above.

 

(oo)         “Indemnified Party” shall have the meaning set forth in Section
11(c).

 

(pp)         “Indemnitor” shall have the meaning set forth in Section 11(d).

 

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(qq)        “Initial Annual Budget” shall have the meaning set forth in Section
3(a).

 

(rr)         “Key Man” shall mean any person set forth on Schedule A attached
hereto.

 

(ss)         “Key Man Employment Agreement” shall mean the Employment Agreements
listed on Schedule A attached hereto, as such may be amended, restated,
supplemented, modified or otherwise renegotiated.

 

(tt)           “Key Man Event” shall have the meaning set forth in Section 12.

 

(uu)        “Law” means any law, statute, act, legislation, bill, enactment,
policy, treaty, international agreement, ordinance, judgment, injunction, award,
decree, rule, regulation, interpretation, determination, requirement, writ or
order of any Government Authority.

 

(vv)         “Loss” or “Losses” means the dollar amounts of all actual costs,
claims, suits, actions, damages, losses, liabilities, obligations, reasonable
fees and expenses of any kind or nature, including costs and expenses of
accountants, attorneys and other professionals, judgments, fines, penalties,
settlements and all other costs and expenses and disbursements of any nature or
type actually paid or incurred or imposed on or asserted against a specified
Person, and all costs and expenses paid or incurred by the prevailing party or
any of its Affiliates in litigating against any other party or any of its
Affiliates, but specifically excluding in all such cases any Excluded Loss.

 

(ww)        “Major Decision” shall have the meaning ascribed to such term in the
Company LLC Agreement.

 

(xx)         “Manager Indemnified Parties” shall have the meaning set forth in
Section 11(a).

 

(yy)         “Non-Controllable Expenses” shall have the meaning set forth in
Section 3(c).

 

(zz)         “Original AMA” shall have the meaning set forth in the Recitals.

 

(aaa)       “Parent” shall mean TexMark Timber Treasury, L.P., a Delaware
limited partnership.

 

(bbb)       “Parent Board” shall mean the partnership board of the Parent, as
established and maintained pursuant to the Parent LP Agreement.

 

(ccc)       “Parent Indemnified Parties” shall have the meaning set forth in
Section 11(c).

 

(ddd)       “Parent LP Agreement” means the Amended and Restated Limited
Partnership Agreement of TexMark Timber Treasury, L.P., a Delaware limited
partnership (as amended or restated from time to time, including all appendixes
and exhibits thereto).

 

6

 

 

(eee)      “Parent Partners” shall mean the Partners of the Parent, as defined
in the Parent LP Agreement.

 

(fff)         “Partner” shall have the meaning set forth in the Parent LP
Agreement.

 

(ggg)      “Party” shall have the meaning set forth in the Preamble.

 

(hhh)      “Person” means an individual or a general partnership, limited
partnership, corporation, professional corporation, limited liability company,
limited liability partnership, joint venture, trust, business trust,
unincorporated organization, cooperative or association or a governmental,
administrative or regulatory agency or any other entity.

 

(iii)         “Preferred Board Members” shall have the meaning set forth in
Section 3(a).

 

(jjj)         “Preferred Partners” shall have the meaning ascribed to such term
in the Parent LP Agreement.

 

(kkk)     “Preliminary Budget” shall have the meaning set forth on Schedule B-2.

 

(lll)         “Property” shall have the meaning ascribed to such term in the
Company LLC Agreement.

 

(mmm)   “Qualified REIT Consultant” means a nationally recognized accounting
firm, which may be the Company’s audit or tax firm, or a nationally recognized
law firm selected by the Asset Manager.

 

(nnn)      “REIT” means a “real estate investment trust” under Section 856 of
the Code

 

(ooo)       “Senior Credit Documents” shall have the meaning ascribed to such
term in the Parent LP Agreement.

 

(ppp)       “Senior Lender” shall have the meaning ascribed to such term in the
Parent LP Agreement.

 

(qqq)       “Senior Officer” means a senior officer or director of the Asset
Manager or its Affiliates.

 

(rrr)        “Services” shall have the meaning set forth in the Section 2(b).

 

(sss)       “Subsidiaries” means, with respect to any Person, any corporation,
partnership, limited liability company, trust or other entity of which all or
any part of the outstanding equity interests are owned, directly or indirectly,
by such Person. For the avoidance of doubt, the Company and its Subsidiaries and
CPR1 shall each be considered a Subsidiary of Parent, and CPR1 shall be
considered a Subsidiary of the Company, for purposes of this Agreement.

 

7

 

 

(ttt)        “Termination Date” shall mean the effective date of any termination
of this Agreement in accordance with the terms hereof.

 

(uuu)      “Thirty-Year Harvest Schedule” shall have the meaning set forth on
Schedule B-2.

 

(vvv)        “Three-Year Harvest Plan” shall have the meaning set forth on
Schedule B-2.

 

(www)     “Timber Manager” shall mean any entity that has been retained by the
Company or a Subsidiary thereof to perform and carry out property management
services at the Property or any other Real Estate Assets.

 

(xxx)        “Transfer” shall have the meaning ascribed to such term in the
Company LLC Agreement.

 

(yyy)        “Wood Supply Agreements” shall have the meaning ascribed to such
term in the Company LLC Agreement.

 

2.             Appointment and Duties of the Asset Manager.

 

(a)           On the terms and subject to the conditions set forth in this
Agreement, the Company, on its own behalf and on behalf of each of its
Subsidiaries, hereby appoints the Asset Manager to serve as asset manager and to
provide the Services, and the Asset Manager hereby accepts such appointment.
Except as otherwise provided herein or in connection with the termination of
this Agreement, neither the Company nor any of its Subsidiaries shall appoint
any other Person to serve as Asset Manager or to provide the services of the
Asset Manager as set forth in this Agreement, except to the extent that the
Asset Manager otherwise agrees, in its sole and absolute discretion. Whenever in
this Agreement the approval or consent of the Company is required, such approval
shall be obtained through the affirmative action of the Company Board, in
accordance with the terms of the Company LLC Agreement.

 

(b)           The Asset Manager undertakes and agrees to use all commercially
reasonable efforts to provide the Services and to otherwise fulfill its
obligations hereunder. In rendering the Services and otherwise fulfilling its
obligations hereunder, the Asset Manager will at all times (i) be subject to the
supervision, management and direction of the Company Board and any applicable
approvals required by or restrictions imposed by this Agreement, the Company LLC
Agreement or the Parent LP Agreement, (ii) have only such functions and
authority as the Company Board may delegate to it, including the functions and
authority identified herein and delegated to the Asset Manager hereby, (iii) not
take, or cause to be taken, any action that constitutes a Major Decision without
such action having received the required prior approval of the Parent Board or
the Company Board, as applicable, in accordance with the Parent LP Agreement or
the Company LLC Agreement, as applicable, (iv) act in a manner consistent with,
and subject to, the applicable Annual Budget (subject to Section 3 hereof) and
applicable Law and (v) act in good faith as a reasonable expert in managing
forestry investments. Subject to the foregoing, during the term of this
Agreement, the Asset Manager will be responsible for the following
(collectively, the “Services”):

 

8

 

 

(i)            preparing the Annual Budget and presenting the Annual Budget for
approval in accordance with Section 3 hereof and the Company LLC Agreement;

 

(ii)            implementing each Annual Budget following the approval thereof
in accordance with the terms of such approved Annual Budget and Section 3
hereof;

 

(iii)           administering the day-to-day business and operations of the
Company and its Subsidiaries and performing and supervising the performance of
such administrative functions necessary to the management of the Company and its
Subsidiaries as may be agreed upon by the Asset Manager and the Company Board;

 

(iv)           assisting the Company in retaining at all times a Qualified REIT
Consultant and other advisors to advise the Company regarding the maintenance of
the Company’s qualification as a REIT and monitoring compliance with the various
REIT qualification tests and other rules set out in the Code and Treasury
Regulations thereunder;

 

(v)            investigating, selecting, engaging and supervising, on behalf of
the Company and its Subsidiaries, third-party service providers as contemplated
by Section 2(c) hereof;

 

(vi)           overseeing the performance by each Timber Manager of its duties
and making periodic recommendations to the Company Board regarding the
engagement, or termination of, such Timber Managers;

 

(vii)         identifying, investigating, analyzing and originating potential
investment opportunities for the Company and its Subsidiaries, to the extent
directed to do so by the Company Board;

 

(viii)        consulting with the Company Board regarding acquiring, financing,
retaining, selling, restructuring or disposing of Business Assets and
recommending strategies for the same;

 

(ix)           supervising and structuring prospective sales or exchanges of
Business Assets, and conducting negotiations with purchasers, brokers, lenders
and, if applicable, their respective agents and representatives, in each case,
as requested by the Company Board;

 

(x)             identifying, evaluating and recommending sources of financing
for the Company and its Subsidiaries, as requested by the Company Board;

 

(xi)            providing the Company Board with periodic review and evaluation
of the performance of the Business Assets and other customary functions related
to asset management;

 

(xii)          taking required actions on behalf of the Company and its
Subsidiaries to qualify to do business in all applicable jurisdictions and to
obtain and maintain all appropriate licenses;

 

9

 

 

(xiii)        taking required actions on behalf of the Company and its
Subsidiaries in complying with all applicable regulatory requirements with
respect to their business activities;

 

(xiv)         preparing and filing all tax returns and tax elections which are
required by applicable law to be filed or are otherwise advisable and taking all
other action reasonably necessary in connection with such required tax filings
and reports with respect to the Company and its Subsidiaries (subject to the
written approval of the Company and/or its Subsidiaries, as applicable);

 

(xv)           preparing, or causing to be prepared, and delivering (i) the
financial reports and other information set forth in Section 4 hereof (pursuant
to the terms thereof), and, (ii) the information related to tax matters set
forth in Section 5 hereof (pursuant to the terms thereof);

 

(xvi)         preparing and providing for submission to and approval by the
Company Board, prior to approval of the first Annual Budget, health and safety
policies and procedures for employees and contractors (including all reasonably
requested amendments thereto from the Company Board), as well as for tracking,
reporting and managing workplace health and safety;

 

(xvii)         ensuring that the Business Assets are managed in accordance with
Sustainable Forestry Initiative requirements, including all required reporting
and auditing obligations, and forecasting a timeline for audits and
recertification, as applicable, and reporting to the Company Board on the same;

 

(xviii)        complying with the requirements of the Wood Supply Agreements,
including preparing, delivering and obtaining approval of the Annual Plan,
Forecast Plan and Delivery Plan (as each such term is defined in the Wood Supply
Agreements) each year when and as required in the Wood Supply Agreements;

 

(xix)          reporting quarterly to the Company Board any variances in harvest
from the harvest plans for the previous calendar quarter exceeding Allowable
Variance as identified on Exhibit A appended hereto, and shall not exceed any
such Allowable Variance without having first obtained the approval of the
Company Board;

 

(xx)           submitting to the Company Board monthly reports detailing any
recordable incidents for employees and contractors that occurred in the previous
month and any material environmental compliance matters, including violations or
potential violations of Laws and best management practices applicable to the
Business Assets, the Company and its Subsidiaries, and the operation of the
same;

 

(xxi)          preparing, or causing to be prepared, and delivering, or causing
to be delivered, to the lenders or other creditors of the Company or any of its
Subsidiaries, such financial information, reports and other information as is
required pursuant to the terms of any loan or credit agreement between the
Company or any of its Subsidiaries and such lenders or creditors;

 

10

 

 

 

(xxii)      providing such other services (i) related to the foregoing as the
Asset Manager and the Company Board may reasonably agree upon or (ii) set forth
elsewhere herein; and

 

(xxiii)    doing all things reasonably necessary to assure its ability to render
the Services as described in this Agreement.

 

Notwithstanding anything else to the contrary in this Agreement, the Asset
Manager shall, at all times in its provision of the above Services, (A) hold
itself out to the public as a legal entity separate and distinct from the
Parent, the Company and its Subsidiaries, (B) correct any known misunderstanding
regarding its status as a separate entity from the Parent, the Company and its
Subsidiaries, (C) conduct and operate its business in its own name and (D) not
identify itself or any of its Affiliates as a division or part of the Parent,
the Company or its Subsidiaries. Further, the Asset Manager shall not assume any
liability for any obligations of the Parent, the Company and their Subsidiaries
(and shall clearly identify in any action taken on behalf of the Company or
their Subsidiaries that the Asset Manager is acting in the capacity as agent and
not in its individual capacity), and neither the Asset Manager nor the Company
nor any of their Subsidiaries shall hold the Asset Manager out to any third
parties as liable for any of the obligations of the Parent, the Company or any
of their Subsidiaries. For the avoidance of doubt, the immediately preceding
sentence is not intended to modify the liability of any Affiliate of the Asset
Manager that owns equity interests of the Parent, subject to the applicable
provisions of the Parent LP Agreement.

 

(c)               The Asset Manager may investigate, select, recommend, engage
and supervise, for and on behalf of, and at the sole cost and expense of, the
Company or its Subsidiaries, accountants, legal counsel, appraisers, insurers,
brokers, transfer agents, registrars, developers, investment banks, valuation
firms, financial advisors, due diligence firms and such other third party
professionals as the Asset Manager reasonably deems necessary or advisable in
connection with the performance of the Services and its other obligations
hereunder, and the Company or its Subsidiaries shall pay for the reasonable cost
and expenses thereof, including pursuant to Section 7 of this Agreement. Any
such engagement of third-party professionals shall not relieve the Asset Manager
from its obligations hereunder.

 

(d)              Anything in this Agreement to the contrary notwithstanding, but
subject to Section 2(g), the Asset Manager shall refrain from taking any action
which, in its sole judgment made in good faith, would (i) reasonably be expected
to adversely affect the status of the Company as a REIT, (ii) subject Parent,
the Company or any of its Subsidiaries to regulation under the Investment
Company Act of 1940, as amended, or (iii) violate any applicable Law or
otherwise not be permitted by the Company LLC Agreement or the Parent LP
Agreement. If such action shall be ordered by the General Partner, the Parent
Board or Company Board, the Asset Manager shall notify promptly the General
Partner, the Parent Board or Company Board, as applicable, of the Asset
Manager’s judgment of the potential impact of such action and shall refrain from
taking such action. In such event, the Asset Manager shall have no liability for
acting in accordance with the specific instructions of the General Partner, the
Parent Board or Company Board so given. Notwithstanding the foregoing, the
Manager Indemnified Parties shall not be liable to Parent, the Company or any of
their respective Subsidiaries, the General Partner, the Parent Board or the
Company Board, or the members, managers or partners of the General Partner,
Parent, the Company or any of their respective Subsidiaries, for any act or
omission by any Manager Indemnified Parties except as provided in Section 11 of
this Agreement.

 

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(e)               In the performance of its obligations and responsibilities
hereunder, the Asset Manager shall not (i) use any corporate funds for any
illegal contributions, gifts, entertainment or other unlawful expenses relating
to political activity, (ii) use any corporate funds for any direct or indirect
unlawful payments to any foreign or domestic governmental officials or employees
or any employees of a foreign or domestic government-owned entity, (iii) violate
any provision of the Foreign Corrupt Practices Act of 1977 or any other
anticorruption Law applicable to the Company or any of its Subsidiaries, (iv)
make, offer, authorize or promise any payment, rebate, payoff, influence
payment, contribution, gift, bribe, rebate, kickback, or any other thing of
value to any government official or employee, political party or official, or
candidate, regardless of form, to obtain favorable treatment in obtaining or
retaining business or to pay for favorable treatment already secured, (v)
establish or maintain any fund of corporate monies or other properties for the
purpose of supplying funds for any of the purposes described in the foregoing
clause (iv) or (vi) make any bribe, unlawful rebate, payoff, influence payment,
facilitation payment, kickback or other similar payment of any nature. The Asset
Manager shall develop and implement an anti-corruption compliance program that
includes internal controls, policies and procedures designed to ensure
compliance with any applicable national, regional or local anti-corruption Law.
The Asset Manager shall report violations or suspected violations of applicable
anti-corruption Law or this Section 2(e) to the Company Board as soon as
practicable after the Asset Manager becomes aware of or suspects a violation.

 

(f)                Without limiting any provision herein, all actions of the
Parent and the Company under this Agreement requiring the consent or approval of
the Company Board shall be subject to the direction of the members of the
Company Board. Asset Manager expressly acknowledges Section 4.12(b) of the
Parent LP Agreement and the Company LLC Agreement.

 

(g)               Asset Manager shall, and shall use reasonable best efforts to
take all actions required to cause the Company to, comply with Sections 4.11 and
5.2 of the Company LLC Agreement.

 

(h)              Asset Manager expressly acknowledges the restrictions on
Parent’s activities pursuant to Sections 4.17 and 4.19 of the Parent LP
Agreement, and understands that the restrictions in Section 4.17 include the
actions of an agent acting on its behalf. Asset Manager acknowledges and agrees
that for U.S. federal income tax purposes it is providing Services to and on
behalf of distinct principals pursuant to this Agreement and agrees that it
shall use reasonable best efforts to take all actions (including avoiding taking
actions) required to cause Parent to comply with such provisions of the Parent
LP Agreement, without prejudice to actions required to be undertaken on behalf
of the Company or its Subsidiaries.

 

12

 

 

3.             Annual Budget.

 

(a)               The Company and its Subsidiaries shall be operated in
accordance with an annual budget, as it may be annually updated from time to
time pursuant to this Section 3 (the “Annual Budget”). The initial Annual Budget
for the period beginning on the Effective Date and ending on December 31, 2018,
including the related variances, is attached hereto as Schedule B-1 (the
“Initial Annual Budget”). For each Fiscal Year thereafter, the Asset Manager
shall be responsible for preparing and submitting to the Company Board for
approval as a Major Decision in accordance with the terms of the Company LLC
Agreement a proposed updated Annual Budget, including the related variances. The
Annual Budget shall be prepared by the Asset Manager in accordance with the
protocols (including the preparation of the back-up materials on the timetable
set forth therein) set forth on Schedule B-2 hereto (the “Budget Development
Protocols”). The Annual Budget for each Fiscal Year shall be prepared with the
same detail and line items as set forth in the Initial Annual Budget and such
other detail as the members of the Company Board appointed by the Preferred
Partners in accordance with Section 4.3(c) of the Parent LP Agreement (the
“Preferred Board Members”) may reasonably request. In connection with the review
of a proposed Annual Budget, the Preferred Board Members may reasonably request
additional information regarding the materials supporting the proposed Annual
Budget or such other information as is necessary or desirable to enable review
of such proposed Annual Budget, and the Asset Manager shall provide such
requested information. The Preferred Board Members shall consent to or reject
the proposed Annual Budget, or request additional information (as provided for
above), within ten (10) Business Days following (i) receipt of such proposed
Annual Budget or (ii) receipt of all additional information that is, in the
determination of the Preferred Board Members, necessary or desirable to enable
review of such proposed Annual Budget. The Asset Manager shall comply with the
Budget Development Protocols regarding the Preliminary Budget for each Fiscal
Year. The Annual Budget shall be prepared and submitted annually by the Asset
Manager no later than December 10 of each year with respect to the following
Fiscal Year. The Annual Budget for each Fiscal Year shall include use of the
pre-funded reserve amounts as shown on Schedule B-3 hereto for the four Fiscal
Quarters comprising such Fiscal Year. In connection with the submission of the
Annual Budget, the Asset Manager shall also prepare and submit to the Company
Board an annual business plan for Parent and its Subsidiaries, including a
responsible five-year operations forecast, including the operating metrics set
forth on Schedule B-4 hereto (the “Annual Plan”). The Preferred Board Members,
or their designated representatives, shall be provided reasonable access to all
information, data, reports, models and analyses relied on in developing the
Annual Plan (including, for the avoidance of doubt, all financial and
silvicultural assumptions, constraints, supporting stand level data,
merchantable timber volumes, pre-merchantable acres by species and age class and
acres by land classification).

 

(b)              Pursuant to this Agreement, the Asset Manager is charged with
implementing each Annual Budget following the approval thereof, in accordance
with the terms of such approved Annual Budget and the terms of this Agreement.
In doing so, the Asset Manager shall at all times act in a manner consistent
with the Annual Budget; provided, however, that the Asset Manager may in its
discretion expend funds for Non-Controllable Expenses (as defined below) not
otherwise reflected in the Annual Budget. In implementing the Annual Budget, the
Asset Manager may in its discretion vary material line items in the applicable
Annual Budget within the variances set forth in Exhibit A appended hereto (such
variances being referred to herein as “Allowable Variances”). Asset Manager
shall not exceed any Allowable Variance without having first obtained the
approval of the Company Board.

 

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(c)               In the event the Asset Manager is unable to obtain the
approval of the Company Board of any Annual Budget prior to the intended period
for such Annual Budget, then a “Budget Impasse” shall be deemed to exist, until
such time as such Annual Budget is approved in accordance with this Agreement,
the Parent LP Agreement and Company LLC Agreement. During any Budget Impasse,
the Asset Manager shall perform the Services and otherwise fulfill its
obligations under this Agreement in accordance with the most recently approved
Annual Budget, except that (i) the Asset Manager may make or cause to be made
any expenditure not contemplated by such Annual Budget which is (1) an emergency
expenditure to protect the health, safety and welfare of people or property (in
which event the Asset Manager shall notify the Company Board immediately) or (2)
an expenditure to satisfy (A) any outstanding taxes and related fees, costs and
expenses, (B) any obligations for interest, principal (except at maturity),
escrows, fees and expenses due under the Senior Credit Documents and any other
indebtedness approved as a Major Decision or (C) premiums for insurance required
under this Agreement, the Parent LP Agreement or the Company LLC Agreement, and
Senior Credit Documents, any loan document relating to indebtedness approved as
a Major Decision or any other contract to which the Parent or any of its
Subsidiaries is a party that are entered into in accordance with the Parent LP
Agreement (such expenses, “Non-Controllable Expenses”) and (ii) the Asset
Manager acting alone shall otherwise have no authority to make any other
expenditure without the approval of the Company Board as a Major Decision.

 

4.             Reporting.

 

(a)               The Asset Manager shall prepare, or cause to be prepared, at
the expense of the Company and its Subsidiaries, all reports, financial or
otherwise, with respect to the Company and its Subsidiaries reasonably requested
in order to comply with their respective organizational documents or any other
materials required to be filed with any governmental body or agency, and shall
prepare, or cause to be prepared, all materials and data necessary to complete
such reports and other materials.

 

(b)              Without limiting the generality of Section 4(a), the Asset
Manager shall prepare, or cause to be prepared, and shall deliver to the Company
and the Company Board, at the expense of Company, the following:

 

(i)                 within forty-five (45) days after the end of each Fiscal
Year, a report as of the end of such Fiscal Year prepared in conformity with
accounting principles generally accepted in the United States and consistently
applied, setting forth (A) a balance sheet of Company (that will include
appropriate footnote disclosure) as of the end of such Fiscal Year, and (B) an
income statement of Company for such Fiscal Year; provided, that the annual
financial statements referred to in this Section 4(b)(i) shall be audited by a
nationally recognized accounting firm in accordance with generally accepted
auditing standards in the United States and consistently applied, and such
accounting firm’s report thereon shall accompany the annual financial
statements; provided, further, that while the Asset Manager shall endeavor to
provide such audited financial statements within the forty-five (45)-day period
stated above, it will not be considered to have breached this Section 4(b)(i) if
it fails to do so if the Asset Manager (x) is using commercially reasonable
efforts to produce audited financial statements within such timeframe, (y)
provides unaudited financial statements within such forty-five (45)-day period
and (z) provides such audited financial statements as soon as practicable
following such date but in any event no later than ninety (90) days after the
end of such Fiscal Year;

 

14

 

 

(ii)              not later than forty-five (45) days after the end of each of
the first three Fiscal Quarters of each Fiscal Year, final versions of each of
the following:

 

(A)             An unaudited report setting forth as of the end of such fiscal
quarter (x) a balance sheet of Company as of the end of such Fiscal Quarter and
(y) an income statement of Company for such Fiscal Quarter

 

(B)              A calculation of the reserves of the Company and the amount of
“Base Available Cash,” “Net Available Cash,” “Distributable Cash Flow” and
“Remaining Distributable Cash Flow” as of the end of the relevant Fiscal
Quarter, in each case, as defined in the Company LLC Agreement;

 

(C)              A narrative describing the condition of the Property and other
Business Assets and operations of Company and its Subsidiaries during such
Fiscal Quarter;

 

(D)             A report of any changes in the status of any major service
contracts, any material line item variances of more than ten percent (10%) from
the Annual Budget and any litigation or other legal issues involving the Parent,
the Company or its Subsidiaries during such Fiscal Quarter; and

 

(E)              A report providing a detailed description of each Permitted HBU
Sale (as defined in the Company LLC Agreement) consummated during such Fiscal
Quarter.

 

(c)               In addition to the reporting requirements set forth above, the
Asset Manager shall give notice to the Company Board of:

 

(i)               Any items that will otherwise be reportable under
Section 4(b)(ii)(D) above promptly after the Asset Manager becomes aware of such
item;

 

(ii)              Any known or reported non-conformance with applicable state
and local regulations and Sustainable Forestry Initiative standards or
principles as in effect on the date hereof and as modified from time to time by
Sustainable Forestry Initiative Inc.; and

 

(iii)             Any proposed transaction between the Company or any of its
Subsidiaries, on the one hand, and any other Person, on the other hand, if such
transaction would create a potential conflict of interest on the part of the
Asset Manager in causing the Company or its Subsidiaries to enter into such
transaction, or any other occurrence of a potential conflict of interest on the
part of the Asset Manager or its Affiliates in connection with causing Company
(or its Subsidiaries) to enter into such transaction.

 

(d)               The Asset Manager shall meet with the Partners on a quarterly
basis to discuss the quarterly reporting and such other topics relating to the
business of the Company and its Subsidiaries as the other Partners may
reasonably request.

 

15

 

 

5.                  Certain Tax Matters. The Asset Manager shall, at Company’s
expense, use reasonable best efforts to (i) not later than twenty-five (25) days
from the end of each Fiscal Quarter (including the end of each Fiscal Year),
provide to the Company a report regarding the Company’s compliance with the REIT
asset tests in Section 856(c)(4) of the Code for such Fiscal Quarter reviewed by
the Qualified REIT Consultant, (ii) not later than forty-five (45) days from the
end of each Fiscal Quarter, provide to the Company the quarterly REIT testing
reports regarding the Company reviewed by the Qualified REIT Consultant and
(iii) not later than forty-five (45) days after the end of each Fiscal Year,
provide to the Company the final REIT testing report regarding the Company
reviewed by the Qualified REIT Consultant. The Asset Manager shall provide to
the Company Board and Partners, as soon as is reasonably practicable following
request thereof, any other information reasonably required to determine
compliance by the Company with the requirements under Section 856 et seq. of the
Code and the related Treasury Regulations for the Company to (x) qualify for,
and maintain, status as a REIT and (y) avoid the imposition of any U.S. federal
income tax or penalty on the Company.

 

6.                  Additional Activities. Nothing in this Agreement is intended
to prevent the Asset Manager or any of its Affiliates, officers, directors,
employees or personnel from engaging in other activities, investments or
businesses, including from rendering advice or services of any kind to any other
Person so long as Asset Manager complies at all times with Section 8 and
promptly notifies the Company Board of any such activities that conflict with
its obligations hereunder.

 

7.                  Bank Accounts. At the direction of the Company Board, the
Asset Manager may establish and maintain one or more bank accounts in the name
of the Company or any of its Subsidiaries (any such account, a “Company
Account”), and may collect and deposit funds into any such Company Account or
Company Accounts, and disburse funds from any such Company Account or Company
Accounts for the payment of Expenses, under such terms and conditions as the
Company Board may approve. The Asset Manager shall from time to time render
appropriate accountings of such collections and disbursements to the Company
and, upon the request of the Company Board, to the Company’s auditors. The Asset
Manager shall disburse funds to pay Expenses from the Company Account in the
name of the entity with respect to which such Expenses relate. For the avoidance
of doubt, the Asset Manager’s disbursement of funds from the Company Accounts
for the payment of Expenses or any other amounts shall be subject to the terms
of the applicable Annual Budget and any limitations on specific Expenses set
forth in Section 10(a).

 

8.                  Records; Confidentiality.

 

(a)               The Asset Manager shall maintain and preserve the books and
records of the Company and its Subsidiaries (including accounting and reporting
systems), and such records shall be accessible for inspection by the General
Partner or representatives of Parent, the Company or any of its Subsidiaries at
any time during normal business hours upon reasonable advance written notice.

 

16

 

 

(b)              The Asset Manager shall keep confidential any and all
information regarding Parent, the Company or its Subsidiaries obtained in
connection with the Services rendered under this Agreement (“Confidential
Information”) and shall not disclose any such Confidential Information (or use
the same except in furtherance of its duties under this Agreement) to
unaffiliated third parties except (i) with the prior written consent of Company
Board; (ii) to legal counsel, accountants and other professional advisors; (iii)
to appraisers, financing sources and others in the ordinary course of business
of Parent, the Company and its Subsidiaries; (iv) to governmental officials
having jurisdiction over Parent, the Company or any of its Subsidiaries; (v) in
connection with any governmental or regulatory filings of Parent, the Company or
any of its Subsidiaries or disclosure or presentations to Parent’s equity
holders or prospective equity holders; (vi) as required by applicable Law; or
(vii) to the extent such information is otherwise publicly available.
Notwithstanding anything herein to the contrary, each of the following shall be
deemed to be excluded from the provisions hereof any Confidential Information
that (A) has become publicly available through the actions of a Person other
than the Asset Manager, (B) is released in writing by CTT, Parent, the Company
or any of its Subsidiaries to the public or (C) is obtained by the Asset Manager
from a third party without breach by such third party of an obligation of
confidence with respect to the Confidential Information disclosed.

 

9.                  Asset Management Fee.

 

(a)               For the period prior to the Amendment Effective Date, the
Asset Manager is entitled to receive the Asset Management Fee earned under the
Original AMA, subject to its terms. Subject to Section 9(b), for the period of
time on and after the Amendment Effective Date, the Asset Manager shall receive
from the Company an asset management fee (the “Asset Management Fee”),
calculated and payable quarterly in arrears, in an annual amount equal to (x)
the Applicable Rate (as defined below) for the applicable period of time,
multiplied by (y) the Base Amount, multiplied by (z) the Beginning Preferred
Partner Ratio. The “Applicable Rate” shall mean 1.00%; provided, however, that
if the entire Initial Preferred Distribution Balance has not been reduced to
zero ($0) in accordance with Section 3.3(d) of the Company LLC Agreement, the
Applicable Rate shall (i) be reduced to 0.75% for the three (3) consecutive
Fiscal Quarters beginning with the first full Fiscal Quarter following the third
(3rd) anniversary of the Effective Date, and (ii) be further reduced to 0.25%
for all Fiscal Quarters thereafter; provided, further, that to the extent that
the Applicable Rate has been so reduced, and subsequent to such reduction the
entire Initial Preferred Distribution Balance is reduced to zero ($0) in
accordance with Section 3.3(d) of the Company LLC Agreement, then the Applicable
Rate shall automatically increase back to 1.0% commencing with the day upon
which such return threshold is achieved. The Asset Management Fee, to the extent
due and owing in accordance with this Agreement, the Parent LP Agreement and the
Company LLC Agreement, shall be paid quarterly within forty-five (45) days
following the end of the preceding Fiscal Quarter.

 

(b)              The payment of the Asset Management Fee shall be subject to
deferral as set forth in the Parent LP Agreement and the Company LLC Agreement.
In addition, the Asset Management Fee shall be subject to reduction pursuant to
the terms of Schedule 5.7 of the Parent LP Agreement.

 

(c)               Asset Manager acknowledges and agrees that the Company and its
Subsidiaries will agree upon an allocation between each of them of the Asset
Management Fee based on the relative Services provided to each of them.

 

17

 

 

10.              Expenses

.

(a)               The Company or its Subsidiaries shall bear and pay (including
pursuant to the terms of Section 7), the following third-party fees, costs and
expenses, whether incurred prior to or following the Effective Date
(collectively, “Expenses”):

 

(i)                 all costs and expenses incurred in connection with the
formation of the Company and its Subsidiaries, and all expenses associated with
the issuance of the Subsidiary REIT Preferred Units, including any placement
agent fees associated with such issuance;

 

(ii)              all fees, costs and expenses incurred in evaluating,
negotiating, structuring, acquiring, holding, managing, leasing, financing,
refinancing, disposing of or otherwise dealing with the Property and other
Business Assets, including any reasonable legal and accounting expenses and
other fees and out-of-pocket costs related thereto, and the costs of rendering
financial assistance to or arranging for financing for any assets or businesses
constituting the Business Assets (including the Property);

 

(iii)            fees, costs and expenses of auditors, appraisers, legal counsel
and other advisors of the Company and its Subsidiaries, insurance costs of the
Company and its Subsidiaries and litigation costs and indemnity expenses of the
Company and its Subsidiaries;

 

(iv)             administrative expenses related to the operation of the Company
and its Subsidiaries, including fees, costs and expenses of accountants, lawyers
and other professionals incurred in connection with the Company’s and its
Subsidiaries’ annual audit, financial reporting, legal opinions and tax return
preparation (including, without limitation, any costs and expenses incurred in
connection with the satisfaction of the requirements of Section 5 hereof), as
well as expenses associated with valuations of the Property and other Business
Assets, including the fees, costs and expenses of any independent appraiser;

 

(v)               interest expenses, brokerage commissions and other investment
costs incurred by or on behalf of the Company and its Subsidiaries;

 

(vi)             the Asset Management Fee, subject to the restrictions and
limitations provided in the Parent LP Agreement and the Company LLC Agreement;

 

(vii)          costs of travel and travel-related expenses with respect to the
business of the Company and its Subsidiaries; provided, that the cost of airfare
shall not exceed commercial fares and, for the avoidance of doubt, shall not
include costs associated with first-class, private or chartered air travel;

 

(viii)        subject to Section 10(c), all taxes and license fees levied
against the Company and its Subsidiaries or their assets or operations;

 

(ix)             the costs of annual REIT compliance testing for the Company,
including fees and expenses of the Qualified REIT Consultant;

 

18

 

 

(x)               insurance costs incurred in connection with the operation of
the business of the Company and its Subsidiaries;

 

(xi)             the compensation of the employee identified on, and subject to
the limitations set forth on, Schedule C; and

 

(xii)          amounts to be contributed or advanced to any Subsidiary for the
purpose of such entity paying any cost of the type described in the foregoing
clauses (i) through (xi).

 

(b)              Notwithstanding anything herein to the contrary, the Asset
Manager and its Affiliates shall bear the costs and expenses incurred by such
Persons in providing for their normal operating overhead, salaries (except as
specifically provided in Section 10(a)(xi)), wages or benefits of their
employees, rent, utilities, expenses of office furniture, computers and other
office equipment, taxes (including taxes imposed on the income or gross receipts
of the Asset Manager on account of fees received pursuant to the terms of this
Agreement), other expenses incurred in maintaining their place of business, and
other similar administrative expenses (including all premiums and expense
required in connection with “errors and omissions” insurance policies covering
the officers and employees of the Asset Manager or its Affiliates). Neither
Parent nor the Company nor any of its Subsidiaries shall pay such expenses, and
Asset Manager shall not be entitled to reimbursement from Parent, the Company or
its Subsidiaries for any such expenses.

 

(c)               For the avoidance of doubt, Asset Manager shall not be
reimbursed for any expenses under this Agreement.

 

11.              Exculpation and Indemnification.

 

(a)               The Asset Manager, its Affiliates and their respective
Constituent Members, employees, managers, consultants and agents (collectively,
the “Manager Indemnified Parties”) will not be liable to Parent, the Company or
any of their respective Subsidiaries, the Parent Board, the General Partner, the
Company Board or the members, managers or partners of Parent, the Company or any
of their respective Subsidiaries for any acts or omissions by any Manager
Indemnified Party, pursuant to or in accordance with this Agreement, except for
any acts or omissions by any Manager Indemnified Party constituting a Bad Act.

 

(b)              To the fullest extent permitted by applicable Law, Company
shall and does hereby agree to indemnify and hold harmless and pay all judgments
and claims against any Manager Indemnified Party, each of which shall be a
third-party beneficiary of this Agreement solely for purposes of this Section
11, from and against any Loss incurred by them for any act or omission taken or
suffered by each Manager Indemnified Party (including any act or omission
performed or omitted by any of them in good faith reliance upon and in
accordance with the opinion or advice of experts, including of legal counsel as
to matters of law, of accountants as to matters of accounting, or of investment
bankers or appraisers as to matters of valuation; provided, that such Persons
were selected and monitored with reasonable care) in connection with, in respect
of or arising from any acts or omissions of such Manager Indemnified Party made
in the performance of this Agreement, except that there shall be no
indemnification for (i) any act or omission of a Manager Indemnified Party that
constitutes a Bad Act or (ii) any indemnification obligation of the Manager
Indemnified Parties pursuant to Section 5.3(b)(iv) of the Parent LP Agreement or
the Losses related thereto.

 

19

 

 

(c)               To the fullest extent permitted by applicable Law, Asset
Manager shall and does hereby agree to indemnify and hold harmless and pay all
judgments and claims against Parent, the Company and its Subsidiaries and each
of their respective Constituent Members, employees, managers, consultants and
agents (collectively, the “Parent Indemnified Parties” and together with the
Manager Indemnified Parties, the “Indemnified Parties”), from and against any
Loss incurred by them in respect of or arising from any acts or omissions by any
Manager Indemnified Party pursuant to or in accordance with this Agreement
constituting a Bad Act. Each of the Parent Indemnified Parties (excluding the
Company) shall be a third-party beneficiary of this Agreement solely for
purposes of this Section 11. For the avoidance of doubt, for purposes of this
Section 11(c), any Loss in respect of or arising from an act by the Asset
Manager in its capacity as a fiduciary under the Employee Retirement Income
Security Act of 1974, as amended, and the regulations thereunder shall not
constitute a Bad Act.

 

(d)              The Indemnified Party will promptly notify the party against
whom indemnity is claimed (the “Indemnitor”) of any claim for which it seeks
indemnification; provided, however, that the failure to so notify the Indemnitor
will not relieve the Indemnitor from any liability which it may have hereunder,
except to the extent such failure actually prejudices the Indemnitor. The
Indemnitor shall have the right to assume the defense and settlement of such
claim; provided, that the Indemnitor notifies the Indemnified Party of its
election to assume such defense and settlement within thirty (30) days after the
Indemnified Party gives the Indemnitor notice of the claim. In such case, the
Indemnified Party will not settle or compromise such claim, and the Indemnitor
will not be liable for any such settlement made, without its prior written
consent. If the Indemnitor is entitled to, and does, assume such defense by
delivering the aforementioned notice to the Indemnified Party, the Indemnified
Party will (i) have the right to approve the Indemnitor’s counsel (which
approval will not be unreasonably withheld, delayed or conditioned), (ii) be
obligated to cooperate in furnishing evidence and testimony and in any other
manner in which the Indemnitor may reasonably request, and (iii) be entitled to
participate in (but not control) the defense of any such action, with its own
counsel and at its own expense. In addition, if the Indemnitor assumes such
defense, the Indemnitor may settle any such claim without the prior consent of
the Indemnified Party if such settlement involves the full release of the
Indemnified Party and does not impose any non-monetary remedies and conditions
on the Indemnified Party without the Indemnified Party’s prior written consent,
which shall not be unreasonably withheld, delayed or conditioned.

 

(e)               Expenses reasonably incurred by an Indemnified Party in
defense or settlement of any claim that may be subject to a right of
indemnification pursuant to Section 11(b) or Section 11(c) shall be advanced by
the Indemnitor prior to the final disposition thereof upon receipt of an
undertaking by or on behalf of such Indemnified Party to repay such amount to
the extent that it shall be determined upon final decision, judgment or order
(whether or not subject to appeal) that such Indemnified Party is not entitled
to be indemnified hereunder.

 

(f)                If a claim for indemnification or payment of reasonable
expenses hereunder is not paid in full within twenty (20) days after a written
notice of claim therefor has been received by the Indemnitor, the claimant may
file suit to recover the unpaid amount of such claim and, if successful in whole
or in part, shall be entitled to be paid the expenses of prosecuting such claim.

 

20

 

 

 

(g)           The indemnification provided by this Section 11 shall be in
addition to any other rights to which an Indemnified Party may be entitled under
any agreement, pursuant to any action of the Company, as a matter of Law or
otherwise, and shall continue as to an Indemnified Party who has ceased to serve
in such capacity.

 

12.          KEY MAN EVENT.

 

(a)            If the employment of any Key Man terminates other than due to
death, Disability (as defined in the Key Man Employment Agreement) or Cause (as
defined in the Key Man Employment Agreement), a “Key Man Event” shall have
occurred. For a period of one (1) year after the occurrence of any Key Man
Event, Company Board and Asset Manager shall discuss, and Company shall
reasonably consider, potential replacements for the relevant Key Man. If, after
such one (1)-year period, no suitable replacement for such Key Man, as
determined by the Company in its reasonable discretion (acting at the direction
of a majority of the Preferred Board Members), is agreed upon by the Asset
Manager and Company (acting at the direction of a majority of the Preferred
Board Members), then the Company (acting at the direction of a majority of the
Preferred Board Members) may, upon written notice to the Asset Manager,
immediately terminate this Agreement.

 

(b)            If the employment of any Key Man terminates due to death,
Disability (as defined in the Key Man Employment Agreement) or Cause (as defined
in the Key Man Employment Agreement), then Asset Manager shall use commercially
reasonable efforts to identify a suitable replacement for such Key Man within a
reasonable period of time thereafter.

 

13.          Term; Termination.

 

(a)           The term of this Agreement shall commence on the Amendment
Effective Date and shall continue until terminated pursuant to Section 12 or
this Section 13.

 

(b)           Notwithstanding anything herein to the contrary, this Agreement
shall automatically and immediately terminate, without the requirement for any
further action by any Party, upon the earliest to occur of (i) the initiation of
the dissolution and liquidation of the Parent pursuant to Article 10 of the
Parent LP Agreement or the Company pursuant to the Company LLC Agreement, (ii)
the removal of the General Partner as the general partner of the Parent pursuant
to Section 4.13 of the Parent LP Agreement or the voluntary resignation of the
General Partner (when such General Partner is an Affiliate of CTT Partner) in
such capacity, (iii) the initiation of any sale process or the initiation of any
other disposition of all or substantially all of the Property and the other Real
Estate Assets pursuant to Section 4.16 of the Parent LP Agreement solely if both
(a) the Alternative Voting System is then in effect pursuant to Section
4.3(b)(ii), (iii) or (iv) of the Parent LP Agreement and (b) a Person other than
the General Partner was appointed to sell the Property and manage all aspects of
the sale process, or (iv) the date that is seven (7) years after the Effective
Date.

 

(c)           The Company, acting at the direction of the Preferred Board
Members and acting without consent or approval of any other members of the
Company Board or any other Person, may terminate this Agreement immediately upon
delivery of written notice of such termination to the Asset Manager (i) in the
event that any Change of Control occurs without the prior written consent of the
Company Board and (ii) for Cause.

 

21

 

 

(d)            Subject to the terms of the “Budget Variance Cure Protocols” set
forth on Exhibit B hereto, the Company, acting at the direction of the Preferred
Board Members, may terminate this Agreement immediately upon delivery of written
notice to the Asset Manager in the event that a Fiscal Year’s actual results (as
determined following the applicable year-end) with respect to a particular Line
Item (as defined in Exhibit B) are outside the applicable Allowable Variance
Limits (as defined in Exhibit B).

 

14.          Payments Due Upon and Following Termination.

 

(a)            Upon the termination of this Agreement pursuant to Section 13(b)
or Section 13(c), the Asset Manager shall not be entitled to any further
compensation hereunder following the Termination Date; provided, however, that
the Asset Manager shall be entitled to receive all accrued but unpaid Asset
Management Fees as of the Termination Date (including Deferred Asset Management
Fees) to the extent that the Company has funds available for such repayment,
unless such termination was consummated pursuant to clause (ii) of Section
13(b).

 

(b)            In the event the Termination Date falls on a day other than the
last calendar day of a Fiscal Quarter, the Asset Management Fee payable with
respect to the Fiscal Quarter in which the Termination Date occurs shall be an
amount equal to the product of (x) the total Asset Management Fee otherwise
payable for such Fiscal Quarter, multiplied by (y) a fraction, the numerator of
which is the number of calendar days between the start of such Fiscal Quarter
and the Termination Date and the denominator of which is the total number of
calendar days in such Fiscal Quarter.

 

15.         SURVIVAL. Notwithstanding anything herein to the contrary, the terms
of Section 8, Section 10, Section 11, Section 14 and Section 16 shall survive
the termination of this Agreement.

 

16.          Miscellaneous.

 

(a)            Nothing in this Agreement shall be construed to make the Company
or any of its Subsidiaries or any other Person, on the one hand, and the Asset
Manager, on the other hand, partners or joint venturers or impose any liability
as such on either of them.

 

(b)           This Agreement, including all schedules and exhibits attached
hereto, constitutes the entire agreement among the Parties pertaining to the
subject matter hereof. This Agreement supersedes any prior agreement or
understanding among the Parties with respect to the subject matter hereof
(including the Original AMA), but shall not amend, modify, supersede or in any
way affect any other agreement or understanding among the Parties or their
Affiliates that does not relate to the subject matter hereof.

 

(c)            This Agreement may be amended, supplemented or waived at any time
and from time to time only by an instrument in writing signed by each Party.

 

22

 

 

(d)           This Agreement and all disputes or controversies arising out of or
relating to this Agreement or the transactions contemplated hereby shall be
governed by, and construed in accordance with, the internal laws of the State of
Delaware, without regard to the laws of any other jurisdiction that might be
applied because of the conflicts of laws principles of the State of Delaware.
Each Party hereby irrevocably consents and agrees that any action, suit or
proceeding with respect to this Agreement shall be brought and determined only
in the exclusive jurisdiction of the Court of Chancery of the State of Delaware,
the courts of the United States of America for the District of Delaware, and
appellate courts thereof, and each Party hereby consents to the jurisdiction of
the aforesaid courts for itself and with respect to its property, generally and
unconditionally, with regard to any such action or proceeding arising out of or
relating to this Agreement and the transactions contemplated hereby. Each Party
further agrees that notice as provided herein shall constitute sufficient
service of process and the Parties further waive any argument that such service
is insufficient. Each Party hereby irrevocably and unconditionally waives, and
agrees not to assert, by way of motion or as a defense, counterclaim or
otherwise, in any action or proceeding arising out of or relating to this
Agreement or the transactions contemplated hereby, (a) any claim that it is not
personally subject to the jurisdiction of the courts in Delaware as described
herein for any reason, (b) that it or its property is exempt or immune from
jurisdiction of any such court or from any legal process commenced in such
courts (whether through service of notice, attachment prior to judgment,
attachment in aid of execution of judgment, execution of judgment or otherwise)
and (c) that (i) the suit, action or proceeding in any such court is brought in
an inconvenient forum, (ii) the venue of such suit, action or proceeding is
improper or (iii) this Agreement, or the subject matter hereof, may not be
enforced in or by such courts. EACH PARTY, FOR ITSELF AND ON BEHALF OF ITS
AFFILIATES, HEREBY WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY ACTION, LAWSUIT OR
PROCEEDING, WHETHER IN CONTRACT OR IN TORT, RELATING TO ANY DISPUTE ARISING
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION DESCRIBED IN THIS
AGREEMENT OR TO ANY DISPUTE BETWEEN THE PARTIES (INCLUDING DISPUTES WHICH ALSO
INVOLVE OTHER PERSONS).

 

(e)           This Agreement shall be binding upon and inure to the benefit of
the Parties and their permitted successors and assigns.

 

(f)            The rights and obligations under this Agreement may not be
assigned or delegated (whether by operation of law, merger, consolidation or
otherwise) by any Party without the prior written consent of the other Parties,
and any attempted assignment without such prior written consent shall be null
and void and of no force or effect; provided, however, that the Asset Manager
shall be entitled, without the consent of the other Parties hereto, to assign
its right, title and interest in and to this Agreement to any lender or other
creditor as collateral security for indebtedness of the Asset Manager or its
Affiliates to such lender or other creditor. The Parties hereto hereby consent
and agree that such lender or other creditor has the right to assert and enforce
any or all of the rights of the Asset Manager collaterally assigned to such
lender or creditor in accordance with the terms and provisions of the related
indebtedness. The Parties hereto agree and acknowledge that none of such lender
or other creditor shall be deemed to have assumed any of the obligations or
liabilities of the Asset Manager under this Agreement by reason of such
collateral assignment.

 

23

 

 

(g)           Subject to Section 11, the provisions of this Agreement are for
the sole and exclusive benefit of the Parties and their permitted successors and
assigns and shall not be deemed to create any rights for the benefit of any
other Person except as specifically provided herein.

 

(h)           If any provision of this Agreement or the application of such
provision to any Party or circumstance shall be held invalid or unenforceable,
the remainder of this Agreement or the application of that provision to another
Party or circumstance shall not be affected thereby.

 

(i)             No waiver by a Party of any default, breach or violation of this
Agreement shall be deemed to be a waiver of any other default, breach or
violation of any kind or nature, whether or not similar to the default, breach
or violation that has been waived, and no failure to enforce a particular
provision in one instance shall be deemed a waiver or modification of rights or
preclude the enforcement thereafter. No acceptance of payment or performance by
a Party after any such default, breach or violation shall be deemed to be a
waiver of any default, breach or violation of this Agreement, whether or not
such Party knows of such default, breach or violation at the time it accepts
such payment or performance. Subject to any applicable statutes of limitation,
no failure or delay on the part of a Party to exercise any right it may have
under this Agreement shall prevent its exercise by such Party, and no such
failure or delay shall operate as a waiver of any default, breach or violation
of this Agreement.

 

(j)             The captions and headings used in this Agreement are for
convenience only and do not in any way affect, limit, amplify or modify the
terms and provisions hereof.

 

(k)          This Agreement may be executed in several counterparts. If so
executed, each of such counterparts shall be deemed an original for all purposes
and all counterparts shall, collectively, constitute one agreement. In making
proof of this Agreement, it shall not be necessary to produce or account for
more than one such counterpart and photocopies may be used.

 

(l)            Notwithstanding anything herein to the contrary, this may not be
amended or modified in a manner that is material and adverse to the interests of
the Senior Lender (or the other secured parties under the Senior Credit
Documents) without the prior written approval of the Senior Lender.

 

Remainder of page left intentionally blank; signature pages follow.

 

24

 

 

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their representatives thereunto duly authorized effective as of the day and year
first above written.

 

  CREEK PINE REIT, LLC       By: TEXMARK TIMBER TREASURY, L.P., its sole member
      By: /s/ John Rasor   Name:   John Rasor   Title:   President

 

[Signature Page to A&R Asset Management Agreement]

 

 

 

 

  CROWN PINE REALTY 1, INC.,   a Delaware corporation       By: /s/ John F.
Rasor     Name: John F. Rasor     Title: President

 

[Signature Page to A&R Asset Management Agreement]

 

 

 

 

  CATCHMARK TRS CREEK MANAGEMENT, LLC       By: CatchMark Timber TRS, Inc., its
sole member       By: /s/ Brian M. Davis   Name:   Brian M. Davis   Title:  
Chief Executive Officer and President

 

[Signature Page to A&R Asset Management Agreement]

 

 

 

 

Schedule A

 

Key Man

 

1.Key Man: Brian M. Davis

 

2.Key Man Employment Agreement: Employment Agreement, dated as of October 30,
2013, by and between CatchMark Timber Trust, Inc. and Brian M. Davis, as amended
by the First Amendment to Employment Agreement, dated December 31, 2018, as
amended by the Second Amendment to Employment Agreement, dated December 19,
2019.

 

 

 

 

Schedule B-1

 

Initial Annual Budget

 

(See attached.)

 

 

 

 

Project Caddo

 

REVISED Schedule B-1 & B-3: Initial 5-Year Quarterly Cash Flow Projections

($'s, except per acre data)

 

NOTE: BASIS OF PRESENTATION IS ON A CASH BASIS

 

[***]

 

 

 

 

 

Schedule B-2

 

Budget Development Protocol

 

·              The Asset Manager will produce an annual harvest schedule
(“Annual Harvest Schedule”), taking into consideration (i) the Company’s
obligations under the Wood Supply Agreements, (ii) Unlevered Cash Flow
requirements, (iii) the long-term value of the Property and (iv) Sustainable
Forestry Initiative (SFI) obligations.

 

·              The Preferred Partners, by a majority vote of the Board Members
designated by the Preferred Partners, may designate a Person to provide
reasonable review and input regarding the following items during the preparation
of the Annual Harvest Schedule: Linear Program (LP) constraints, financial
assumptions, silvicultural assumptions and harvest volume in excess of or
outside of Wood Supply Agreement obligations. The initial such designee shall be
TTG Forestry Services, LLC.

 

·              Each Annual Harvest Schedule will include a thirty (30)-year
harvest schedule (“Thirty-Year Harvest Schedule”) and a rolling three (3)-year
harvest plan (“Three-Year Harvest Plan”). A written summary of each Annual
Harvest Schedule will be made available to the Company Board, including all
assumptions, constraints utilized and supporting stand level information as may
be necessary for a reasonable evaluation of the Thirty-Year Harvest Schedule and
the Three-Year Harvest Plan. In addition, annual property profiles including
merchantable timber volumes, pre-merchantable acres by species and age class and
acres by land class shall be provided.

 

·             To the extent necessary to facilitate the Company Board’s review
of the proposed Annual Budget, the Asset Manager will also (i) provide the
Company Board information regarding tract and stand-level activity for the
Property and applicable other Real Estate Assets (including, for example, site
preparation and treatment, planting method, stock type, planting density,
thinning plan, volume removals by product class and detailed inventory
information) and (ii) furnish the Company Board a copy of the then-current
Geographic Information Systems (GIS) data for the Property and applicable other
Real Estate Assets.

 

·              The Asset Manager will seek, based on the Three-Year Harvest
Plan, to develop a preliminary version of the Annual Budget (“Preliminary
Budget”) and present such Preliminary Budget to the Company Board no later than
September 10th of each calendar year for review and consideration.

 

·              The Company Board will provide any comments and feedback
regarding the Preliminary Budget no later than September 25th of each calendar
year.

 

·              Based on the Preliminary Budget timber volumes (as the same
reflects the comments and feedback of the Board) the Asset Manager will provide
the “Annual Plan” and “Forecast Plan” volumes to the respective counterparties
to the Wood Supply Agreements, as required, on or before September 30th of each
calendar year.

 

·              The proposed Annual Budget submitted to the Company Board for
final approval pursuant to Section 3 of this Agreement will reflect any changes
required by the counterparties to the Wood Supply Agreements after review of the
Annual Plan volumes.

 

·              The Annual Budget will include the terms pertaining to any
Permitted HBU Sale to be conducted during the applicable Fiscal Year, including
(i) a general description of the Property and other Real Estate Assets to be
sold, (ii) the minimum price and (iii) any permissible non-standard commercial
terms.

 

Schedule B-2—Page 1

 

  

Schedule B-3

 

Pre-Funded Reserves

 

(See attached.)

 

 

 

Project Caddo

REVISED Schedule B-1 & B-3: Initial 5-Year Quarterly Cash Flow Projections

($'s, except per acre data)

 

NOTE: BASIS OF PRESENTATION IS ON A CASH BASIS

 

[***]

 

 

 

Schedule B-4

 

Operating Metrics

 

1.Recordable incident rate

 

2.Conformity with certification requirements provided by Sustainable Forestry
Initiative Inc.

 

3.Development of managerial talent

 

4.Litigation risk

 

5.Compliance with applicable environmental statutes and regulations

 

6.Technology and information systems infrastructure

 

 

 

Schedule C

 

Employees

 

1.John Rasor, in the amount of up to $500,000 annually, but only to the extent
he is performing the Services. The Parties acknowledge and agree that this
amount shall be considered by the Company as an expense within the “Forestry
Management” line item of the applicable Annual Budget.

 

 

 

Exhibit A

 

Allowable Variances

 

Item Minimum Maximum Plantation Clearcut Acres [***] [***] Total GP/IP WSA
Volume [***] [***] Weighted Age of Plantation Clearcuts [***] [***] Hardwood
Release [***] [***] Mid Rotation Fertilization [***] [***] Road Maintenance
[***] [***] Site Prep + Plant + Seedlings + Herbaceous Weed Control [***] [***]
Fertilization at Establishment [***] [***] Capital Infrastructure Expenses,
including bridges, culverts and road construction [***] [***]

 

 

 

Exhibit B

 

Budget Variance Cure Protocols

 

1.If the actual results for a Fiscal Year (as determined following the
applicable year-end) reflect a variance (measured against the applicable Annual
Budget) (a “Budget Variance”) above or below the “Minimum” or “Maximum” values
set forth on Exhibit C hereto (the “Allowable Variance Limits”) with respect to
any of the line items set forth on Exhibit C (each, a “Line Item”), then the
Asset Manager will, simultaneously with the delivery of the results of such
Fiscal Year, provide the Company Board with a written notice (a “Budget Variance
Notice”) setting forth in reasonable detail:

 

(i)a description of such Line Item and the amount of the Budget Variance;

 

(ii)the underlying causes of the Budget Variance, including (A) a Force Majeure
Event (as defined below), (B) market issues, (C) regulatory or environmental
compliance, (D) SFI compliance, or (E) such other causes as the Asset Manager
identifies (each, a “Notice Event”); and

 

(iii)if the Budget Variance is due to a Force Majeure Event, recommendations for
reducing or eliminating the amount of the anticipated Budget Variance and the
appropriate cure period (not to exceed the applicable cure period set forth
opposite such Line Item on Exhibit C hereto) (each, a “Proposed Variance Cure”),
including (A) a description of the actions required to implement each Proposed
Variance Cure, (B) the financial implications of each Proposed Variance Cure,
(C) an estimated timeline to implement each Proposed Variance Cure, and (D) the
Asset Manager’s preferred Proposed Variance Cure.

 

As used above, “Force Majeure Event” means any (i) any Change Event (as defined
in the applicable Wood Supply Agreement) under a Wood Supply Agreement or (ii)
the occurrence of a Force Majeure (as defined in the applicable Wood Supply
Agreement) under a Wood Supply Agreement.

 

2.If the Notice Event identified in the Budget Variance Notice is a Force
Majeure Event (in which case such Budget Variance Notice is referred to herein
as a “Force Majeure Budget Variance Notice”), then, subject to the remaining
provisions of this Exhibit B, the Company Board may not immediately terminate
this Agreement pursuant to Section 13(d) with respect to the Line Item
identified in such Force Majeure Budget Variance Notice. If, however, the Notice
Event identified in the Budget Variance Notice is not a Force Majeure Event,
then the Company Board shall have the right to immediately terminate this
Agreement pursuant to Section 13(d).

 

3.Upon delivery of a Force Majeure Budget Variance Notice, the Company Board and
the Asset Manager will work together in good faith for a period of 45 days to
approve a Proposed Variance Cure, either as originally presented in the Force
Majeure Budget Variance Notice or subject to such modifications as the Company
Board and the Asset Manager mutually agree upon.

 

Exhibit B—Page 1

 

 

4.If a Proposed Variance Cure is agreed within the 45-day period set forth in
paragraph 3 above (an “Agreed Variance Cure”), then the Asset Manager shall
implement such Agreed Variance Cure within the applicable cure period. If the
Asset Manager fails to implement the Agreed Variance Cure within the applicable
cure period, then the Company Board shall have the right to immediately
terminate this Agreement in accordance with Section 13(d).

 

5.If a Proposed Variance Cure is not agreed within the 45-day period set forth
in paragraph 3 above, then the Asset Manager will in good faith implement the
Proposed Variance Cure that the Company Board determines is in the best
interests of the Company, taking into account long-term asset value (the
“Company-Determined Variance Cure”). The Company Board shall have the right to
immediately terminate this Agreement if the Asset Manager fails to implement a
Company-Determined Variance Cure within the applicable cure period.

 

6.Notwithstanding anything to the contrary contained herein, (i) all actions of
the Company Board hereunder shall be taken as a Major Decision, and (ii) with
respect to any of the Line Items under the heading “Seasonal Events” on Exhibit
C hereto, if the Asset Manager fails to implement the Annual Budget within the
parameters set forth in the applicable Annual Variance Limits for a period of
two (2) consecutive Fiscal Years (a “Two Year Seasonal Line Item Implementation
Failure”), then the Company Board shall have the right to immediately terminate
this Agreement pursuant to Section 13(d) (notwithstanding any Budget Variance
Notices); provided, however, that if in each of such two (2) consecutive Fiscal
Years, (x) a named hurricane or tropical storm (in each case, affecting at least
10% of the total acres of the Parent and its Subsidiaries by acreage) or (y)
disease, insect infestation, wind, ice or fire (in each case, affecting at least
5,000 acres of harvest units in the current 3-year harvest plan of the Company)
has occurred, and the Asset Manager has delivered Budget Variance Notices that
identify such events as the Notice Events, then the Company Board shall not have
the right to terminate this Agreement with respect to such Two Year Seasonal
Line Item Implementation Failure.

 

7.Notwithstanding anything to the contrary contained herein, if, during a Fiscal
Year, the Asset Manager in good faith determines that it is reasonably likely
that a Budget Variance will exist with respect to a Line Item, then the Asset
Manager may provide the Company Board with a written notice setting forth, in
reasonable detail (1) a description of such Line Item, (2) an estimate of the
amount of the anticipated Budget Variance, and (3) a description of the
underlying Notice Event (an “Expected Variance”), and the Company Board may, as
a Major Decision, approve or disapprove such Expected Variance. If the Company
Board approves an Expected Variance, then, notwithstanding anything to the
contrary contained herein, the Company Board’s right to terminate this Agreement
pursuant to Section 13(d) shall be waived to the extent of such Expected
Variance with respect to such Fiscal Year.

 

All capitalized terms used and not otherwise defined herein shall have the
meanings given to them in the Agreement.

 

Exhibit B—Page 2

 

 

Exhibit C

 

Variance Termination Triggers

 

Non-Seasonal Events Minimum Maximum Cure Period for Force Majeure Event Hardwood
Release + mid rotation fertilization [***] [***] 365 days from end of Fiscal
Year Road Maintenance [***] [***] 180 days from end of Fiscal Year Capital
Infrastructure (incl. bridges, culverts, road construction) [***] [***] 180 days
from end of Fiscal Year   [***] [***]   Seasonal events [***] [***]   Total
GP/IP WSA [***] [***] No cure if outside variance for 2 successive years
Plantation Clearcut Acres [***] [***] No cure if outside variance for 2
successive years Weighted Age of plantation Clearcuts [***] [***] No cure if
outside variance for 2 successive years Site Prep + Plant + Seedlings +
Herbaceous Weed Control [***] [***] No cure if outside variance for 2 successive
years  Fertilization at Establishment [***] [***] No cure if outside variance
for 2 successive years

 

(1)Notwithstanding anything herein to the contrary, variances attributable to
Non-Controllable Expenses (as defined in the Parent LP Agreement) shall not be
counted towards determining whether there is a variance above or below the
Annual Budget.

 

(2)Measured on an annual basis based upon the applicable annual financial and
operational information presented by the Asset Manager to the Company Board
within forty-five (45) days of the end of each Fiscal Year.

 

(3)Cure period for the Line Items under the heading “Seasonal Events” to be
agreed upon by the Company Board and the Asset Manager in accordance with clause
(c) of Exhibit B; provided, that if the cure period cannot be timely agreed
upon, then the cure period shall be as set forth above.