Exhibit 10.22


 


EXECUTION
COPY


 


STUMPAGE
AGREEMENT


 


 


Between


 


 


SCIOTO
LAND COMPANY, LLC


 


 


and


 


 


CHILLICOTHE
PAPER INC.


 

















 


STUMPAGE
AGREEMENT


 


This
Agreement is made as of December 16, 2005, by and between Scioto Land
Company, LLC, a Delaware limited liability company (“Seller”), and Chillicothe
Paper Inc., a Delaware corporation (“Buyer”).


 


Recitals


 


Seller
desires to sell and Buyer desires to purchase, on the terms and conditions
hereinafter set forth, certain quantities and types of wood fiber located on
certain timberlands owned by Seller.


 


Therefore,
in consideration of the mutual covenants and agreements set forth herein, the
parties hereto agree as follows:


 


Agreement


 


1.             Definitions.  For the purposes of this Agreement the capitalized
terms set forth below shall have the meanings set forth after them.


 


1.1           “Affiliate”
shall mean with respect to any Person, any Person controlling, controlled by,
or under common Control with, such Person.


 


1.2           “Annual
Buyer Harvesting Notice” shall mean a written notice from Buyer to Seller to be
given not later than October 1 of each Harvesting Year during the Term of
this Agreement (beginning with Harvesting Year 2007) specifying which of the
Actual Designated Tracts Buyer will harvest during the upcoming calendar year.


 


1.3           “Annual
Purchase Amount” shall mean (a) for each Harvesting Year from January 1,
2006 through the Harvesting Year beginning January 1, 2010, a minimum of
Two


 

















 


Hundred
Ninety-Four Thousand (294,000) tons of Qualifying Timber; (b) for each
Harvesting Year from January 1, 2011 through the Harvesting Year beginning
January 1, 2016, a minimum of Two Hundred Thirty-Five Thousand (235,000)
tons of Qualifying Timber; and (c) to the extent Buyer exercises its
option to extend the Term pursuant to Section 9.2 below, for each
Harvesting Year from January 1, 2017 through the Harvesting Year beginning
January 1, 2019, a minimum of Two Hundred Five Thousand (205,000) tons of
Qualifying Timber.


 


1.4           “Annual
Seller Notice” shall mean the annual notice provided by Seller to Buyer in
accordance with the provisions of Section 3.1.2.1 of this Agreement.


 


1.5           “Applicable
Laws” shall mean, with respect to any Person, all laws, ordinances, judgments,
decrees, injunctions, writs, orders, rules, regulations, determinations,
licenses and permits of any Governmental Authority applicable to or binding
upon such Person or any of its property.


 


1.6           “Base
Price Adjustment Date” shall mean January 1, 2006 and each subsequent
second anniversary following January 1, 2006 (ie - January 1, 2008, January 1,
2010, etc...) during the Term of this Agreement.


 


1.7           “Business
Day” shall mean any day other than a Saturday, Sunday, or other day on which banks are authorized to be closed in Ohio.


 


1.8           “Control”
shall mean, with respect to any Person, the power to direct or cause the
direction of the management of such Person, directly or indirectly, whether
through the ownership of voting securities or otherwise.


 


1.9           “Event
of Default” shall have the meaning set forth in Section 9.3 hereof.


 


1.10         “Fair
Market Timber Value” shall mean the then current fair market value of a Product
as mutually determined by Buyer and Seller. 
If Buyer and Seller are unable to reach


 

















 


mutual
determination, then the applicable Fair Market Timber Value shall be determined
in accordance with the Fair Market Timber Value Mechanism.


 


1.11         “Fair
Market Timber Value Mechanism” shall mean the following procedure used to
determine the Fair Market Timber Value of each type of Qualifying Timber hereunder.  Either Seller or Buyer may initiate
commencement of the Fair Market Timber Value Mechanism by notice to the other
(a “Mechanism Notice”).  Not later than
ten (10) days following receipt of a Mechanism Notice, Seller and Buyer
shall agree on the Valuation Consultant. 
Not later than thirty (30) days following selection of the Valuation
Consultant, each of Seller, Buyer and the Valuation Consultant shall submit to
the others not less than six (6) Qualifying Sales relating to the then
applicable Fair Market Timber Value determination.  The Fair Market Timber Value of the
Qualifying Timber at issue shall be (a) the sum of (i) the average
price per ton of all Qualifying Sales submitted by Seller, plus (ii) the
average price per ton of all Qualifying Sales submitted by Buyer, plus (iii) the
average price per ton of all Qualifying Sales submitted by the Valuation
Consultant, (b) divided by three.


 


1.12         “Force
Majeure Event” shall mean any act, omission or circumstance occasioned by or
resulting from any acts of God, acts of the public enemy, wars, blockades,
insurrections, riots, epidemics, infestation, disease, landslides, lightning,
earthquakes, tornadoes, windstorms, volcanoes, fires, storms, floods,
disasters, civil disturbances, explosions, sabotage, governmental actions, the
failure to act of any Governmental Authority, strikes or other labor disputes,
failures or partial failures of any equipment, failure of transportation,
adverse financial or market conditions, or an involuntary ceasing of operations
at the Mill for a minimum of thirty (30) consecutive days, or any other events
or circumstances not within the control of a party hereto which prevents such
party from


 

















 


performing
its obligations hereunder; provided, however, that “Force Majeure Event” shall
not include (i) a party’s financial inability to perform, or (ii) an
act, omission or circumstance arising from the negligence or willful misconduct
of the party claiming that a Force Majeure Event has occurred.


 


1.13         “Governmental
Authority” shall mean any federal, state, local or foreign government,
political subdivision, agency, board, court, regulatory body or commission, any
arbitrator with authority to bind a party at law, or any Person acting lawfully
on behalf of any of the foregoing.


 


1.14         “Hardwood
Pulpwood” shall mean pulpwood from hardwood species of timber.


 


1.15         “Hardwood
Stringer Product Price” shall mean the per ton price for Hardwood Stringers as
set forth on Schedule 1.15 attached hereto (the “Base Price”) adjusted up
or down beginning January 1, 2006 on a quarterly basis pursuant to the
price adjustment mechanism set forth in said Schedule 1.15.  On each Base Price Adjustment Date during the
Term of this Agreement, the Base Price for Hardwood Stringers shall be adjusted
to equal the Fair Market Timber Value for such Product on the applicable Base
Price Adjustment Date.


 


1.16         “Hardwood
Stringers” shall mean timber meeting the specifications for the same set forth
on Schedule 1.29.


 


1.17         “Harvesting
Plan” shall mean a description of the type of harvest (such as clear cuts or
thins), together with diameter limits and residual basal area, as applicable.


 


1.18         “Harvesting
Year” shall mean the period from December 17, 2005 through December 31,
2005 for calendar year 2005 and January 1 through December 31 of each
year thereafter during the Term of this Agreement.


 

















 


1.19         “Market
Region” shall mean all areas which are located within one hundred twenty (120)
miles of the Mill.


 


1.20         “Mechanism
Notice” shall have the meaning set forth in Section 1.11 hereof.


 


1.21         “Mill”
shall mean Buyer’s pulp and paper mill located in Chillicothe, Ohio.


 


1.22         “Person”
means any individual, corporation, partnership, limited liability company,
joint venture, association, joint-stock company, trust, unincorporated organization
or Governmental Authority.


 


1.23         “Preliminary
Designated Tract” shall have the meaning set forth in Section 3.1.2.1
hereof.


 


1.24         “Product”
shall mean the individual types of Timber listed in Section 1.33 below.


 


1.25         “Product
Price” shall mean the Pulpwood Product Price or the Hardwood Stringer Product
Price, as applicable.


 


1.26         “Pulpwood”
shall mean Hardwood Pulpwood and Softwood Pulpwood.


 


1.27         “Pulpwood
Product Price” shall mean the per ton price for each Product as set forth on Schedule 1.27(a) (the
“Base Price”) adjusted up or down first on January 1, 2008 and again on
each Base Price Adjustment Date thereafter so that the applicable Pulpwood
Purchase Price shall be adjusted to equal the Fair Market Timber Value for such
Product on the applicable Base Price Adjustment Date.


 


1.28         “Qualifying
Sales” shall mean per unit (as opposed to lump sum) sales of the type of
Qualifying Timber at issue made during the three calendar quarters immediately
prior to the calendar quarter month period in which the applicable Base Price
Adjustment Date occurs (including sales that are subject to bona fide
agreements with unaffiliated third parties, whether or not they have been
harvested during such three calendar quarter period), provided such sales


 

















 


(i) are made within the Market Region, and (ii) involve not
less than 1,000 tons of the type of Qualifying Timber at issue as to each such
sale.  Qualifying Sales shall exclude
sales of Qualifying Timber between Buyer and Seller under this Agreement.


 


1.29         “Qualifying
Timber” shall mean Timber which meets or exceeds the specifications set forth
in Schedule 1.29 to this Agreement.


 


1.30         “SMZ’s”
shall mean Streamside
Management Zones, designated as such by Seller, and any similar environmentally
protected zones so designated during the Term of this Agreement.


 


1.31         “Softwood
Pulpwood” shall mean the following types of Timber set forth in Schedule 1.29
to this Agreement.


 


1.32         “Sustainable
Forest Practice Standards” shall mean practices substantially in compliance with
standards substantially similar to the Sustainable Forestry Initiative of the
American Forest and Paper Association (the “AF&PA”) and as that standard
may be modified by AF&PA from time to time.


 


1.33         “Timber”
shall mean the following types of timber now or hereafter located on the
Timberlands set forth in Schedule 1.29 to this Agreement.


 


1.34         “Timberlands”
shall mean all timberland properties purchased by Seller from Escanaba Timber
LLC on the date hereof and located in the State of Ohio and the Ohio Woodlands
located in Greenup and Lewis Counties, Kentucky.


 


1.35         “TMS”
shall mean the publication known as Timber Mart-South, or in the event TMS is
no longer published, a comparable publication mutually acceptable to Seller and
Buyer.


 


1.36         “Valuation
Consultant” shall mean either Fountain Forestry of Portsmouth, Ohio or
BalkenTier Consulting of Morgantown, West Virginia, or if such firms are no
longer in


 

















 


existence,
another reputable, professionally qualified Person meeting all of the following
criteria.  Such person (i) is not an
Affiliate of either Seller or Buyer, (ii) during the past two (2) years
has not transacted substantial business with either Seller or Buyer, and (iii) does
not have less than five (5) years experience relating to sales of Timber
within the Market Region.  If Seller and
Buyer are unable to agree within thirty (30) days, then an arbitrator selected
pursuant to Subsection 10(b) below shall select such reputable,
professionally qualified Person meeting the foregoing criteria.  Seller and Buyer shall provide to the
Valuation Consultant such information as the Valuation Consultant shall
reasonably request to facilitate the determinations to be made by the Valuation
Consultant hereunder.


 


2.             Agreement to Sell and Purchase.


 


2.1           Quantities
to be Sold and Purchased.  Subject to
the terms and conditions of this Agreement, Seller agrees to sell and Buyer
agrees to purchase for each Harvesting Year during the Term of this Agreement
all Qualifying Timber harvested from the Actual Designated Tracts (as
hereinafter defined).


 


2.2           Required
Product Mix.  With respect to the
Timber to be purchased by Buyer hereunder, Seller shall make available to Buyer
the following product mix for each Harvesting Year during the Term of this
Agreement:


 


2.2.1        2006
– 2010.  For the Harvesting Years
beginning January 1, 2006 and ending December 31, 2010, the mix of
Timber Seller shall make available to Buyer shall be as follows:


 

















 


	
  (a)

  	
  Hardwood Pulpwood:

  	
   

  	
  not less than 157,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
  Softwood Pulpwood:

  	
   

  	
  not less than 86,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (c)

  	
  Hardwood Stringers:

  	
   

  	
  not less than 51,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (d)

  	
  All Other Products:

  	
   

  	
  no minimum requirement

  



 


2.2.2        2011
– 2016.  For the Harvesting Years
beginning January 1, 2011 and ending December 31, 2016, the mix of
Timber Seller shall make available to Buyer shall be as follows:


 


	
  (a)

  	
  Hardwood Pulpwood:

  	
   

  	
  not less than 82,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
  Softwood Pulpwood:

  	
   

  	
  not less than 125,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (c)

  	
  Hardwood Stringers:

  	
   

  	
  not less than 28,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (d)

  	
  All Other Products:

  	
   

  	
  no minimum requirement

  



 


2.2.3        2017
– 2019.  To the extent Buyer
exercises its option to extend the Term pursuant to Section 9.2 below, for
Harvesting Years beginning January 1, 2017 and ending December 31,
2019, the mix of Timber Seller shall make available to Buyer shall be as
follows:


 


	
  (a)

  	
  Hardwood Pulpwood:

  	
   

  	
  not less than 60,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
  Softwood Pulpwood:

  	
   

  	
  not less than 125,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (c)

  	
  Hardwood Stringers:

  	
   

  	
  not less than 20,000 tons

  
	
   

  	
   

  	
   

  	
   

  
	
  (d)

  	
  All Other Products:

  	
   

  	
  no minimum requirement

  



 


2.3           Adjustments
to Product Mix.  Seller and Buyer
acknowledge and agree that either party may from time to time request
modifications to the Product mix set forth above during any Calendar Year as a
result of its temporary inability to satisfy such Product mix due to adverse


 

















 


weather
or other unanticipated conditions.  So
long as the aggregate total volume of all Products required to be delivered for
the Calendar Year is not reduced, and so long as the other party’s operations
would not be adversely affected in any material respect as a result thereof,
each party agrees to grant such requests.


 


3.             Designation of Tracts and Determination of Volumes.


 


3.1           Designation
of Tracts to Be Harvested.  During
the Term of this Agreement, Seller shall designate the portions of the
Timberlands which Seller shall make available to Buyer for harvesting during
each of the next two Harvesting Years.  A
sufficient number of tracts shall be made available so as to satisfy the
obligations of Seller herein to sell to Buyer and Buyer to purchase from Seller
the applicable Annual Purchase Amount. 
Seller shall follow the procedure for designating such tracts
hereinafter set forth in this Section 3.


 


3.1.1        Initial
Designation of Tracts to be Harvested.  Schedule 3.1.1 attached hereto
and made a part hereof sets forth the portions of the Timberlands which Seller
shall make available to Buyer for the Harvesting Year commencing January 1,
2006 and the Harvesting Year commencing January 1, 2007.


 


3.1.2        Subsequent
Designation of Tracts to be Harvested.  For the Harvesting Year commencing January 1,
2008, and for all subsequent Harvesting Years during the Term of this
Agreement, the portions of the Timberlands which Seller shall make available
for harvesting shall be determined in accordance with the following procedure.


 


3.1.2.1     Designation
of Potential Harvesting Areas.  On or
before the October 1 prior to the applicable Harvesting Year (e.g. October 1,
2007 for the Harvesting Year commencing January 1, 2008), Seller shall
designate in a notice to Buyer those portions of the Timberlands which it
proposes to make available to Buyer for harvesting during the subsequent


 

















 


two Harvesting Years (the “Preliminary
Designated Tracts”).  To the extent
practicable and not inconsistent with the silvicultural and long-term
management objectives of Seller, the land which Seller designates as the
Preliminary Designated Tracts shall be distributed relatively uniformly over
the four geographical quadrants (north, south, east and west) of the
Timberlands, and Preliminary Designated Tracts will not contain Stringer stumpage from
previously high-graded tracts harvested during the Term of this Agreement, and
Preliminary Designated Tracts shall be offered to a buyer on a proportionate
basis with other purchasers of timber from the Timberlands (based on the
relative volume of purchases by Buyer and such other purchasers) to allow Buyer
the opportunity for wet-weather harvesting.


 


3.1.2.2     Selection
of Actual Harvesting Areas.  During
the thirty (30) day period following receipt by Buyer of the applicable Annual
Seller Notice, Seller and Buyer shall meet to discuss any proposed modification
to the Preliminary Designated Tracts which may be reasonably requested by
Buyer.  During such thirty (30) day
period, Buyer and Seller agree to review the applicable Harvesting Plan to
determine whether Seller has not made available, in Buyer’s reasonable
judgment, a sufficient number of Preliminary Designated Tracts with pine trees
and, if Buyer so determines, the parties shall negotiate in good faith to reach
agreement with respect to the number of such pine trees to be included in the
Preliminary Designated Tracts.  To the
extent the parties are unable to read agreement on the availability of pine
trees, any such dispute shall be settled in accordance with Section 10 of
this Agreement. At the end of said thirty (30) day period, Seller shall notify
Buyer of the actual tracts which Buyer will harvest to satisfy the volume
requirements of this Agreement for the applicable Harvesting Year, taking into
account said proposed modifications reasonably requested by Buyer, to the
extent


 

















 


practicable (the “Actual
Designated Tracts”), and Seller shall simultaneously therewith deliver to Buyer
a Harvesting Plan for each of the Actual Designated Tracts.


 


3.2           Boundary
and Timber Markings.  Within fifteen
(15) Business Days prior to the scheduled commencement of harvesting activities
on the applicable Actual Designated Tract, Seller and Buyer will proceed with
the designation of boundary lines consistent with past practices of
MeadWestvaco Corporation, but Seller reserves the right to designate on the
ground (using bright timber-marking paint) the boundary lines of all such
Actual Designated Tracts.  The boundary
lines shall clearly delineate the boundaries of the Actual Designated Tracts
from the boundaries of adjacent land not owned or leased by Seller, and from
the boundaries of other Timberlands not constituting Actual Designated Tracts
for such Harvesting Year.  Seller shall
also designate on the ground (using bright timber-marking paint) all SMZ’s
within the Actual Designated Tracts and any Timber to be removed from such
designated SMZ’s.


 


4.             Harvesting Procedures.


 


4.1           Harvesting
Schedule.  Following determination of
the Actual Designated Tracts, Buyer shall provide a harvesting schedule to
Seller setting forth approximate start and completion dates relating to
harvesting Timber within each of the Actual Designated Tracts.  Buyer shall modify said harvesting schedule based
upon any reasonable objections raised by Seller with respect to any of said
harvesting dates, said reasonable objections may be for reasons which include,
but are not limited to, (a) a violation of Sustainable Forestry
Certification Requirements, (b) potential logging damage to the site, such
as rutting, or (c) failure to comply with Sustainable Forestry Initiative
regeneration requirements applicable to harvesting on adjacent lands.  Notwithstanding the foregoing, Buyer shall
harvest the Actual Designated Tracts on the basis of the Annual Buyer
Harvesting Notices provided by Buyer to Seller each calendar


 

















 


year during the
Term of this Agreement, subject to a Force Majeure Event, and subject to the
provisions of Section 4.3 below.


 


4.2           Timber
Roads.  Seller shall construct, or cause to be
constructed, at Seller’s sole cost and expense, haul roads (including
temporary, winter haul roads (“Winter Roads”) when appropriate) to the Actual
Designated Tracts necessary to provide Buyer in a timely manner with proper
access to such Actual Designated Tracts for its harvesting operations.  Construction of such roads shall be
accomplished in a good and workmanlike manner in compliance with all Applicable
Laws so that Buyer is provided with effective and functional access to all
Actual Designated Tracts for its logging practices.  Following the construction of said roads,
Buyer shall at its sole cost and expense maintain and repair said roads for so
long as it is harvesting on the relevant Actual Designated Tracts.  Upon Seller’s delivery of the Harvesting Plan
to Buyer, one or more representatives of Buyer shall review the construction of
the Winter Roads and negotiate in good faith with one or more representatives
of Seller to determine whether said Winter Roads are sufficient for the Buyer’s
intended use and, only upon such agreement being reached, Buyer shall retain
responsibility for the cost of maintaining and repairing said Winter
Roads.  If the parties are unable to
reach agreement with respect to the sufficiency of said Winter Roads, the
dispute shall be settled in accordance with Section 10 of this
Agreement.  Upon completion of harvesting
on the relevant Actual Designated Tracts, Buyer shall leave such roads in a
condition equal to or better than their condition prior to the start of the
operation.  All such road maintenance and
repair shall be performed in a manner so as not to violate any Applicable Laws,
or with respect to SMZ’s, so as to comply with best management practices
sanctioned by the State of Ohio.


 

















 


4.3           Timber
Harvesting.  Buyer shall harvest
(i.e. cut and remove) in each Harvesting Year, all merchantable Timber as
identified in the Harvesting Plan for the Actual Designated Tracts for such
Harvesting Year, subject to a Force Majeure Event.  Such harvesting operations shall be conducted
in accordance with all Applicable Laws, in a manner consistent with established
industry logging practices, and in compliance with any reasonable additional
guidelines which may be established from time to time by Seller.  Buyer shall repair all fences or structures
damaged by its harvesting operations and shall leave all roads, fire breaks,
property lines, lakes, and perennial and intermittent streams clear of logs,
timber, limbs or other debris.  All oil
drums, cans, bottles, cartons, delimbing bars, loading decks, abandoned
equipment and other debris resulting from Buyer’s operations shall be removed
from the applicable portions of the Timberlands upon completion of the
harvesting operations at Buyer’s expense. 
If repairs are not made or if the debris is not removed and cleared
within thirty (30) days after notice from Seller to Buyer, then Seller may
undertake such repair or removal for Buyer’s account, and Buyer shall be liable
to Seller for any expense incurred in repairing or removing same.  Buyer shall not, under any circumstance, bury
any material underground nor discharge, release or
otherwise cause the Timberlands or any portion thereof to be affected by
hazardous wastes or hazardous substances. 
Buyer shall use normal and customary care while conducting its
harvesting operations so as not to materially damage the Timberlands.  Buyer acknowledges that a higher degree of
care is required when the site is abnormally wet and that such circumstances may
require Buyer to halt all harvesting activities.  Seller reserves the right to suspend Buyer’s
harvesting operations when Seller deems site damage will result from continued
operations; provided, however, that in the event of such suspension, Buyer
shall be entitled to an extension of the time allotted for its harvesting
operations equal to the number of days that the suspension


 

















 


continues.  Seller also reserves the right to suspend
Buyer’s harvesting operations on an Actual Designated Tract when Seller
determines, in the exercise of its reasonable discretion, that Buyer is not
conducting harvesting operations on the Actual Designated Tract in accordance
with the relevant Harvesting Plan.  In
the event Buyer conducts harvesting operations in violation of the relevant
Harvesting Plan or outside the scope of the relevant Harvesting Plan, then
Seller shall be entitled to pursue all remedies available at law for timber
trespass.


 


5.             Prices and Payment.


 


5.1           Prices.  Buyer shall pay Seller for all Timber
purchased by Buyer in an amount equal to the then current applicable Product
Price.


 


5.2           Payment.  Promptly after harvest all Qualifying Timber
shall be weighed (or, with respect to sawtimber, ) at
the Mill, Piketon Merchandising Yard, or other outside location as determined
by Buyer.  Buyer shall provide Seller on
a weekly basis (with photocopies of weigh tickets if requested by Seller) and a
settlement statement, and shall pay Seller each week for all Timber weighed-in
during the previous week.  The equipment
used for the weighing of Timber shall be maintained by Buyer in good and
accurate working order in accordance with all applicable laws and regulations
and prudent practice.  Seller shall have
the right to check and audit said equipment at any time upon reasonable notice
to Buyer.  Payments made after twenty
(20) days from the date of delivery shall be considered past due (“Past Due”).  For payments that are Past Due, Buyer shall
pay interest at a rate per annum equal to the daily prime rate as reported in
the Wall Street Journal plus four percent (4%) for each day that the payments
are Past Due.  Such interest shall be
calculated daily on the basis of a year of 365 days and the actual number of
days for which interest is due.  If at
any time during the Term there are any payments outstanding to Seller that are
Past Due, then, in addition to any other remedies it may have


 

















 


hereunder,
Seller may suspend harvesting by Buyer (or deliveries by Seller to the Mill, if
applicable) until such time as all Past Due payments have been paid in full.


 


5.3           Pay
or Take.


 


5.3.1        If
for any Calendar Year, Seller fails for any reason other than Force Majeure to
make available to Buyer Actual Designated Tracts for any Harvesting Year that
would allow Buyer to harvest at least ninety percent (90%) of each of the Products
comprising the designated Annual Purchase Amount for such Calendar Year, Seller
will pay Buyer at a rate of $10.00 per ton for Hardwood Pulpwood, $15.00 per
ton for Softwood Pulpwood and $30 per ton for Hardwood Stringers, respectively,
multiplied by the difference between (x) ninety percent (90%) of the number of
tons of the applicable Product comprising the Annual Purchase Amount for the
applicable Calendar Year minus (y) the actual number of tons of the applicable
Product made available by Seller for harvesting by Buyer during such Calendar
Year, as liquidated damages and not as a penalty, and Buyer shall have no
further claim for damages on account of such shortfall in the delivery of such
Product comprising the Annual Purchase Amount. 
Payment shall be made by Seller to Buyer on demand no later than fifteen
(15) days from Buyer’s written request for such payment.


 


5.3.2        If
for any Calendar Year, Buyer fails for any reason other than Force Majeure to
harvest at least ninety percent (90%) of each Product comprising the Annual
Purchase Amount (other than by virtue of a failure of Seller to make available
the full amount of Tracts for harvesting such Product in the applicable
Calendar Year), then Buyer shall pay Seller for the shortage at a rate of $10.00
per ton for Hardwood Pulpwood, $15.00 per ton for Softwood Pulpwood and $30 per
ton for Hardwood Stringers, respectively, multiplied by the difference between
(x) ninety percent (90%) of the number of tons of the applicable Product
comprising the


 

















 


Annual Product Amount for the applicable Calendar Year minus (y) the
volume of the applicable Product comprising the Annual Product Amount actually
harvested by Buyer hereunder during such Calendar Year, as liquidated damages
and not as a penalty, and Seller shall have no further claim for damages on
account of Buyer’s failure to harvest the Annual Product Amount.  Payment shall be made by Buyer to Seller on
demand no later than fifteen (15) days from Seller’s written request for such
payment.


 


5.3.3.       Subject
to the terms of Section 2.3 above, any payments made pursuant to this Section 5.3
shall be calculated separately for Softwood Pulpwood, Hardwood Pulpwood and
Hardwood Stringers.  If this Agreement is
in termination at a time other than the beginning or end of a calendar year,
the Annual Product Amount for purposes of calculating such shortage payment for
either party will be prorated equitably.


 


5.3.4        Notwithstanding
anything herein to the contrary, Seller shall not be obligated to pay
liquidated damages under Section 5.3.1 solely with respect to a failure to
make available a sufficient amount of Tracts for harvesting Softwood Pulpwood
to the extent Seller establishes to the reasonable satisfaction of Buyer that
from the date of this Agreement through the relevant date of determining the
applicability of liquidated damages there did not exist Tracts with sufficient
harvestable timber to enable Seller to satisfy its obligations to make
available the required volumes of Softwood Pulpwood under this Agreement.  Such determination shall be made such that
Seller shall not be entitled to the benefit of this provision to the extent the
failure to have Tracts available for harvesting is caused by any sale of the
Timberlands, whether permitted under the terms of this Agreement or not.


 

















 


6.             Indemnity.


 


6.1           Indemnification
by Seller.  Seller shall defend,
indemnify and hold Buyer harmless from and against any and all claims,
liabilities, costs or damages (including without limitation reasonable
attorneys fees and court costs through all appeals) arising out of personal
injury, death or property damage arising from (i) Seller’s ownership,
operation and/or maintenance of the Timberlands, and (ii) the performance
or non-performance by Seller of its obligations hereunder.


 


6.2           Indemnification
by Buyer.  Buyer shall defend,
indemnify and hold Seller harmless from and against any and all claims,
liabilities, costs or damages (including without limitation reasonable
attorneys fees and court costs through all appeals) arising out of personal
injury, death or property damage arising from (i) Buyer’s harvesting
operations on the Timberlands, and (ii) the performance or non-performance
by Buyer of its obligations hereunder.


 


(a)           Survival.  The provisions of this Section 6 shall
survive the expiration or earlier termination of this Agreement.


 


7.             Force Majeure.


 


7.1           Effect
of Force Majeure.  Except for the
obligation of a party to make payments required hereunder, the parties shall be
excused from performing any of their respective obligations under this
Agreement and shall not be liable in damages or otherwise on account of the
non-performance of any such obligation, for so long as and to the extent that
such party is unable to perform such obligation as a result of any Force Majeure
Event.


 


7.2           Mitigation
and Notice.  The occurrence of a
Force Majeure Event shall not relieve a party of its obligations and liability
hereunder to the extent such party fails to use commercially reasonable efforts
to remove the cause and remedy or mitigate the effects of the Force Majeure
Event if, with commercially reasonable efforts, such party could have removed
such cause or


 

















 


remedied
or mitigated such effects.  In addition,
no Force Majeure Event shall relieve a party of its obligations or liability
hereunder unless such party shall give notice (including a reasonable
description of such Force Majeure Event) to the other party as soon as
reasonably possible and in any event within twenty (20) days of the occurrence
of such Force Majeure Event. Upon request, the party whose obligations were
suspended shall provide the other party with a plan for remedying the effects
of such Force Majeure Event.


 


7.3           Failure
to Give Notice.  A failure to give
notice under Section 7.2 above “as soon as reasonably possible” will not
affect the rights and obligations of the party whose obligations are suspended
except if, and only to the extent that, the party which was entitled to receive
such notice was actually and materially prejudiced as a result of such failure.


 


7.4           Force
Majeure Event Affecting Actual Designated Tracts.  If either party becomes aware of a Force
Majeure Event that makes a portion of any Actual Designated Tract unavailable
for harvesting by Buyer in accordance with the schedule contemplated by
the parties, then it shall promptly notify the other party and Seller shall
promptly designate and make available for harvesting such other portions of the
Timberlands as shall be necessary to satisfy its obligations under this
Agreement.  If the Seller is unable to
designate sufficient portions of the Timberlands to satisfy its obligations
under this Agreement, then the provisions of Section 7.5 shall apply to
the unsatisfied obligations occasioned by such Force Majeure Event.


 


7.5           Volume
Reduction Based on Force Majeure Event. 
If the party that becomes subject to a Force Majeure Event (the “Affected
Party”) reduces the volume of Timber to be purchased or sold due to a Force
Majeure Event (the amount of such reduction, the “Reduction Amount”), the
Affected Party shall give written notice to the other party (the “Non-Affected
Party”) of such reduction and the effective date thereof.  If such reduction continues in effect for


 

















 


a period of sixty
(60) days or more, the Non-Affected Party shall then have the right, in the
case of Seller, to sell all or part of the Reduction Amount of such Timber not
purchased by Buyer to another buyer or buyers, and in the case of Buyer, to
purchase all or part of the Reduction Amount of Timber not sold by Seller from
another seller or sellers, subject to the following:


 


(i)            The
Non-Affected Party shall not enter into any contract for any such sale or
purchase for a term longer than one (1) year’s duration.


 


(ii)           The
Non-Affected Party shall give the Affected Party written notice of each such
contract, including the volume sold or purchased thereunder and the term
thereof.


 


(iii)          The
annual volume commitment of the Non-Affected Party for Timber as specified
herein shall be reduced by such volume sold or purchased under such contract for
the duration thereof.


 


8.             [Intentionally Left Blank]


 


9.             Term and Termination.


 


9.1           Term.  This Agreement shall expire on December 31,
2016, unless this Agreement is sooner terminated for cause pursuant to Section 9.3
hereof, or unless this Agreement is extended as provided in Section 9.2
(the “Term”).


 


9.2           Extension
of Term.               Provided that Buyer shall not then be in
default under this Agreement, the Term of this Agreement may be extended at the
option of Buyer for one (1) additional three (3) year term, which
extension term shall commence concurrently with the expiration of the initial
term, upon the same terms and conditions as contained in this Agreement.  In the event that Buyer desires to extend
this Agreement pursuant to the above


 

















 


extension
option, it shall give written notice of such desire to extend the Term to
Seller no later than January 1, 2016.


 


9.3           Termination
for Cause.  This Agreement shall
immediately terminate if any one of the following events (each, a “default”)
has occurred and is continuing on the tenth (10th) day after receipt of notice
of an intent to cancel by reason of such default
(each, an “Event of Default”):


 


(a)           Breach
of any other term of this Agreement, which breach is not cured within twenty
(20) days after receipt of written notice thereof; or


 


(b)           Insolvency
or the filing by or against Seller or Buyer of a petition in bankruptcy (which,
in the event of an involuntary bankruptcy, is not dismissed within sixty (60)
days from the date of its commencement), or appointment by a court of a
temporary or permanent receiver, trustee or custodian.


 


9.4           Effect
of Termination.  Termination shall
not relieve a defaulting party of any liability to the nondefaulting party for
breach of its obligations hereunder.


 


10.           Dispute Resolution.  Disputes under this Agreement shall be
resolved as follows, it being understood that each party shall work in good
faith at each step of the process to try to resolve the dispute as
expeditiously and fairly as possible:


 


(a)           The
appropriate responsible persons from Seller and Buyer shall meet and seek
amicably to resolve all differences.


 


(b)           If
any material difference remains unresolved ten (10) Business Days after
the start of the process referenced in Subsection 10(a), or such longer
period as the persons referenced in Subsection 10(a) shall have
agreed, then the parties shall submit such matter to


 

















 


arbitration,
pursuant to the Rules of Commercial Arbitration of the American
Arbitration Association.  Any such
arbitration shall be conducted by a single arbitrator, whose decision shall be
final.  The parties shall first attempt
to agree on the selection of the arbitrator, and, if they cannot agree within
fourteen (14) days after it becomes necessary to submit the dispute to
arbitration, either party may request the American Arbitration Association to
appoint the arbitrator.  In all cases,
the arbitrator shall be a person knowledgeable about sales of timber in the
Market Region.  The arbitrator shall be
instructed to schedule all proceedings so that, if possible, a decision
may be reached and communicated to the parties within forty-five (45) days
after the appointment of the arbitrator. 
All expenses of the arbitration shall be divided equally between the
parties, except that each party shall bear the expense of its own counsel and
the expense of the preparation of its presentation.  Seller and Buyer shall provide to the
arbitrator such information as the arbitrator shall reasonably request to
facilitate the determinations to be made by the arbitrator hereunder.


 


(c)           Notwithstanding
the existence of a dispute or the progress of the arbitration proceeding, but
subject to the terms of Section 5.2 above, the parties shall continue to
perform their respective obligations under this Agreement during such period.  To the extent that this Agreement provides
for specific performance or other equitable remedies for a particular
violation, and with respect to the ability of Seller to suspend Buyer’s
harvesting operations pursuant to Section 4.3 and the ability of Seller to
suspend Buyer’s harvesting operations (or deliveries by Seller to the Mill, if
applicable) pursuant to Section 5.2, this Section 10 shall not apply,
it being the intent that the aggrieved party be able to bring the matter to
court to seek enforcement as soon as possible. 
Further, this Section 10 shall not preclude any party from


 

















 


seeking
injunctive relief or such other interim equitable remedies as may be required
to preserve any claims hereunder.


 


11.           Assignment.


 


11.1         Assignment
by Seller.


 


(a)           Except as provided in this Section 11.1,
this Agreement may not be assigned by Seller in whole or in part.  Notwithstanding the foregoing, at any time
during the Term, Seller may assign this Agreement (i) to any lender or
lenders as security for obligations to such lender or lenders in respect to
financing arrangements of Seller or any Affiliate thereof with such lender or
lenders, or (ii) upon prior written notice to Buyer, to any Person that is
and at all times remains an Affiliate of Seller or that merges or consolidates
with or into Seller or that acquires all or substantially all of the
Timberlands.


 


(b)           Notwithstanding
any other provision of this Agreement to the contrary, Buyer and Seller
acknowledge and agree that Seller shall not be prohibited from selling all or
any portion of the Timberlands, provided that any such sale of the Timberlands
shall be made subject to the terms of this Agreement and the obligation to
supply the applicable portion of Timber volumes required hereunder.  Upon any sale of a portion of the
Timberlands, the purchaser of said portion of the Timberlands (“New Owner”)
shall assume the obligation to supply a portion of the Timber volumes to be
supplied hereunder, said portion of the Timber volumes (“Assumed Volume”) to be
agreed to by Seller and said New Owner, subject to Buyer’s consent to such
volume allocation, which consent shall not be unreasonably withheld or
delayed.  Upon such assumption by said
New Owner, Seller’s obligations to supply Timber hereunder shall be reduced by
the volumes assumed by said New Owner, and Seller shall thereafter have no
obligation or liability with respect to said assumed volumes or with respect to
the portion of the


 

















 


Timberlands so conveyed.  At the request of Seller, upon any such sale
to a New Owner Buyer shall execute an amendment to this Agreement acknowledging
the foregoing.  Furthermore, upon request
of Seller or Buyer, upon such sale to a New Owner, Buyer and such New Owner
shall enter into a separate Stumpage Agreement on the same terms and
conditions as contained in this Agreement (or such other terms as Buyer and
such New Owner shall mutually agree) except for the portion of the Timberlands
covered thereby and the volume of Timber to be supplied thereunder.  In the event Buyer objects to any proposed
Assumed Volume, Buyer shall provide written notice of the same to Seller within
fifteen (15) days of notice to Buyer of said proposed Assumed Volume (“Objection
Notice”), said Objection Notice to include a detailed explanation of the basis for
said objection.  Failure by Buyer to
timely provide said Objection Notice shall be deemed to constitute the consent
of Buyer to said proposed Assumed Volume.  In the event Buyer timely provides an
Objection Notice, Seller shall have the option of (i) revising said
proposed Assumed Volume, in which case Buyer shall have the further right to
object by providing a new Objection Notice as provided above or (ii) retaining
the Valuation Consultant to determine whether the proposed Assumed Volume is
reasonable.  In the event the Valuation
Consultant is so retained and determines that said proposed Assumed Volume is
reasonable, Buyer shall be deemed to have consented to said
Assumed Volume and shall pay all costs and expenses of said Valuation
Consultant.  Otherwise, said costs and
expenses shall be paid by Seller. 
Notwithstanding the foregoing, Seller may convey during the Term hereof
up to 15,000 acres of the Timberlands, except for Pine Plantations that have or
will have volume that continues to be available for harvesting during the Term
of this Agreement (in which case such Plantations maybe sold only if the
requirements concerning an allocation of volume to such purchaser and the New
Owner entering into a stumpage agreement with Buyer as otherwise


 

















 


provided in this Section 11.1(b
have been satisfied),  free and clear of
the obligations of this Agreement (the “Exempt Acres”), provided that Seller is
able to supply the volume of Timber required to be supplied hereunder from the
remaining portion of the Timberlands. 
Buyer agrees to execute any and all documentation requested by Seller in
order to evidence the release of the Exempt Acres from this Agreement.


 


11.2         Assignment
by Buyer.  Except as provided in this
Section 11.2, this Agreement may not be assigned by Buyer in whole or in
part.  Notwithstanding the foregoing, at
any time during the Term, Buyer may assign this Agreement (a) to any
lender or lenders as security for obligations to such lender or lenders in
respect of financing arrangements of Buyer or any affiliate thereof with such
lender or lenders, or (b) upon prior written notice to Seller, to any
Person that is and at all times remains an affiliate of Buyer or that merges or
consolidates with or into Buyer or that acquires all or substantially all of
the assets or stock of Buyer.


 


12.           Publicity.  This
Agreement is confidential and no party shall issue press releases or engage in
other types of publicity of any nature dealing with the commercial and legal
details of this Agreement without the other party’s prior written
approval.  However, approval of such
disclosure shall be deemed to be given to the extent such disclosure is
required to comply with Applicable Laws, governmental rules, regulations or
other governmental requirements, or in connection with any financing
arrangements of such party.  In such
event, the publishing party shall, to the extent reasonably practicable,
furnish, in advance, a copy of such proposed disclosure, to the other party.


 


13.           Headings.  The
headings contained in this Agreement are for convenience only and should not be
construed to limit or expand any terms otherwise provided.


 

















 


14.           Notices.  All
notices, requests, demands and other communications provided for hereunder
shall be in writing and personally delivered or sent by regular U.S. certified
mail, telecopy or Federal Express (or similar type of overnight delivery) to
the applicable party at the address indicated below:


 


	
  If to Buyer:

  	
   

  	
  Chillicothe Paper Inc.

  401 S. Paint Street

  Chillicothe, Ohio 45601

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Stephen A. Brown

  327 South Paint Street

  P. O. Box 2500

  Chillicothe, Ohio 45601

  Telecopier No. 740-772-3670

  Telephone No. 740-772-3480

  
	
   

  	
   

  	
   

  
	
  and

  	
   

  	
  Lee Bendtsen

  401 South Paint Street

  Chillicothe, Ohio 45601

  Telecopier No. 740-772-0000

  Telephone No. 740-772-3960

  



 


	
  If to Seller:

  	
   

  	
  Scioto Land Company, LLC

  
	
   

  	
   

  	
  c/o Tolleson
  Land & Timber, Inc.

  
	
   

  	
   

  	
  P.O. Box
  970

  
	
   

  	
   

  	
  Perry,
  Georgia 31069

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attn.:
  Robert G. Chambers

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Mazursky &
  Dunaway LLP

  
	
   

  	
   

  	
  Monarch
  Tower, Suite 2400

  
	
   

  	
   

  	
  3424 Peachtree
  Road

  
	
   

  	
   

  	
  Atlanta,
  Georgia 30326-1118

  



 

















 


	
   

  	
   

  	
  Attn: C. Glenn Dunaway,Esq.

  



 


or, as to each
party, at such other address as shall be designated by such party in a written
notice to the other party complying as to delivery with the terms of this
Section.  Notice shall be deemed received
when (i) hand delivered; (ii) sent, after receipt of confirmation or
answer back if sent by telecopy; (iii) five Business Days after deposit in
the U.S. mails, postage prepaid, for certified mail; and (iv) one Business
Day after delivery to Federal Express (or similar type of overnight delivery),
properly addressed to the applicable party.


 


15.           Partial Illegality.  If any provision, or part of a provision, of
this Agreement is held to be invalid or unenforceable under any Applicable Law,
then the parties shall use all commercially reasonable efforts to replace the
invalid or unenforceable provision by a provision that, to the extent permitted
by Applicable Law, achieves the purposes intended under the original provision
and to allow the parties to have the intended benefit of their bargain.  If it cannot be so reformed, it shall be
omitted.  The balance of this Agreement
shall remain valid and unchanged and in full force and effect.


 


16.           Waiver of Compliance.  Any delay or omission on the part of either
party to this Agreement in requiring performance by the other party hereunder
or in exercising any right hereunder shall not operate as a waiver of any
provision of this Agreement or of any right or rights hereunder.  Further, any failure by either party to
enforce at any time any term or condition under this Agreement shall not be
considered a waiver of that party’s right thereafter to enforce each and every
term and condition of this Agreement.


 


17.           Amendments and
Waivers.  This Agreement may not be
terminated, amended, supplemented, waived or modified orally, but only by a
document in writing signed by the party


 

















 


against which the
enforcement of such termination, amendment, supplement, waiver or modification
is sought.


 


18.           Counterparts.  This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same document.  All signatures
need not be on the same counterpart.


 


19.           Estoppel
Certificates.  Either party shall, at
no cost to the requesting party, from time to time, upon twenty (20) days prior
request by the other party, execute, acknowledge and deliver to the requesting
party a certificate signed by an officer of the certifying party stating that
this Agreement is unmodified and in full force and effect (or, if there have
been modifications, that this Agreement is in full force and effect as
modified, and setting forth such modifications) and the dates through which
payments have been made, and either stating that to the knowledge of the signer
of such certificate no default exists under this Agreement or specifying each
such default to which the signer has knowledge.


 


20.           Prevailing Party.  If either party brings any proceeding for the
judicial or other interpretation, enforcement, termination, cancellation or
rescission of this Agreement, or for damages for the breach thereof, the
prevailing party in any such proceeding or appeal thereon shall be entitled to
its reasonable attorneys’ fees and court and other reasonable costs incurred,
to be paid by the losing party as fixed by the court in the same or a separate
proceeding, and whether or not such proceeding is pursued to decision or
judgment.  The terms and provisions of
this Section 20 shall survive the expiration or earlier termination of
this Agreement.


 

















 


21.           Entire Agreement.  This Agreement constitutes the entire
agreement and understanding between the parties with respect to the subject
matter hereof and merges all prior discussions and negotiations between the
parties.  None of the parties shall be
bound by any conditions, definitions, representations, or warranties with
respect to the subject matter of this Agreement other than as expressly set
forth above.


 


22.           Third Party
Beneficiaries.  Except as hereinafter
provided, this Agreement is intended to be solely for the benefit of the
parties thereto and their permitted assigns and is not intended to and shall
not confer any rights or benefits on any third party not a signatory
hereto.  


 


23.           Memorandum of
Contract.  At the request of any
party hereto, a Memorandum of this Agreement shall be recorded in the recording
offices of each and every County in which the Timberlands are located.


 


24.           Insurance.  In the
event that Buyer retains any third party contractor to conduct harvesting
operations on the Timberlands, said third party contractor shall, before
conducting any operations, obtain and maintain the following types of
insurance, consistent with the limits required by all of Buyer’s independent
Wood Producers, in addition to any other insurance required by law:  (a) Worker’s Compensation and, to the
extent the same is reasonably commercially obtainable, Employer’s Liability
Insurance, fully covering all operations; (b) Comprehensive Vehicle
Liability Insurance, including owned, hired and non-owned vehicles; and (c) Comprehensive
General Liability Insurance.  Prior to
the beginning of any harvesting operations hereunder, evidence of all such
insurance shall be furnished to Seller, and such insurance shall provide for at
least thirty (30) days notice to Seller of cancellation of such insurance
policies.  All such insurance policies shall
name Seller as an additional insured.


 

















 


25.           Sustainable Forestry Initiative.  Seller shall continue to manage the
Timberlands in accordance with the Sustainable Forestry Initiative during the
Term of this Agreement.  From time to
time it may be necessary to agree upon a recognized successor or alternative
standard to the Sustainable Forestry Initiative, which shall be negotiated in
good faith to reflect changes or developments in the evolution of widely
accepted industry standards.  In the
future, Seller agrees to provide from time to time at Buyer’s request
third-party verification of its compliance with such a standard on the portion
of the Actual Designated Tracts from which Timber is then being harvested.


 


26.           Raccoon Ecological Management Area.


 


26.1         The
portion of the Timberlands identified on Schedule 26.1 attached hereto is
commonly referred to as the Raccoon Ecological Management Area (the “REMA Tract”).  Seller agrees that promptly after the date of
this Agreement it shall negotiate in good faith the sale of the REMA Tract to
the Ohio Department of Natural Resources (the “ODNR”) on a price reasonably
acceptable to Buyer and ODNR.  Until such
time, if any, that a sale of the REMA Tract is made, Seller agrees to manage
the REMA Tract in substantially the same manner as the REMA Tract had been
managed by Escanaba Timber LLC and under its prior ownership by MeadWestvaco
Corporation (or one of its Affiliates) and shall continue to make available
Timber for harvesting under this Agreement as necessary to fulfill Seller’s
volume requirements under this Agreement.


 


26.2         If
after good faith negotiations with the ODNR fail to result in a sale of the
REMA Tract to the ODNR, Seller may not sell, transfer or convey, either
directly or indirectly, by operation of law or otherwise, any interest to all
or any portion of the REMA Tract (the “Timberlands Interest”), unless the
acquiring party that will own the Timberland Interest agrees


 

















 


in
a written instrument satisfactory to Buyer to be bound by the provisions of
Sections 26.3 and 26.4 hereof (but not Section 26.1).


 


26.3         Use
of CORE REMA Tract.  Notwithstanding
anything herein to the contrary, unless and until the REMA Tract is sold to the
ODNR as contemplated hereby, Seller agrees that it shall permit Seller to
continue to use and have access to the facilities on the portion of the REMA
Tract described on Schedule 26.3 (the “CORE REMA Tract”) for the same
purposes as such facilities have been used prior to the date hereof and Seller
shall use reasonable best efforts to ensure that any subsequent owner of the
REMA Tract (other than the ODNR) permits such continued use by Seller.


 


26.4         Ownership
of Tangible Assets.  Seller
acknowledges and agrees that the tangible assets described in Schedule 26.4
are owned by Buyer (or one of its Affiliates) and the US Forest Service and
that nothing herein or in any other agreement shall convey any right, title or
interest in such assets (or any right to remove or make use of such assets) to
Seller and that Buyer and the US Forest Service shall maintain ownership thereof,
notwithstanding any sale of the REMA Tract, whether permitted under the terms
of this Agreement or otherwise.


 


26.5         Applicability
of Right of First Offer.  The
provisions of Section 26 shall not apply to:  (a) any condemnation of any portion of
the REMA Tract, or any sale in lieu thereof; or (b) any easement, cutting
contract, or hunting license on any portion of the REMA Tract.


 

















 


Executed under
seal as of the date first set forth above.


 


	
   

  	
   

  	
  CHILLICOTHE PAPER INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Peter H. Vogel

  
	
   

  	
   

  	
  Name:

  	
  Peter H. Vogel

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  SCIOTO LAND COMPANY, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Tolleson-Knox Land Management Company, LLC,

  
	
   

  	
   

  	
   

  	
  Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert G. Chambers

  
	
   

  	
   

  	
  Name:

  	
  Robert G. Chambers

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice President