POTLATCH CORPORATION
                       1995 STOCK INCENTIVE PLAN


     1. PURPOSE.

     This Potlatch Corporation 1995 Stock Incentive Plan is 
intended to provide incentive to employees and directors of 
Potlatch Corporation (the "Corporation") and its eligible
subsidiaries, to encourage proprietary interest in the
Corporation and to encourage employees and directors to remain 
in the service of the Corporation or its subsidiaries.

     2. DEFINITIONS.

     (a) "Award" means any award of an Option, Restricted Stock 
or an Other Share-Based Award under the Plan.
     (b) "Board" means the Board of Directors of the
Corporation.
     (c) "Code" means the Internal Revenue Code of l986, as 
amended.
     (d) "Committee" means the Committee appointed by the Board 
in accordance with Section 4. 
     (e) "Common Stock" means the $1 par value common stock of 
the Corporation.
     (f) "Corporation" means Potlatch Corporation, a Delaware 
corporation.
     (g) "Director" means a director of the Corporation.
     (h) "Disability" means the condition of an Employee who is 
unable to engage in any substantial gainful activity by reason 

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                                                            Exhibit (10)(n)

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of any medically determinable physical or mental impairment 
which can be expected to result in death or which has lasted or 
can be expected to last for a continuous period of at least 12
months.
     (i) "Employee" means an individual (who may be an officer 
or a Director) employed by the Corporation or a Subsidiary 
(within the meaning of Code section 3401 and the regulations 
thereunder).
     (j) "Exercise Price" means the price per Share of Common 
Stock at which an Option may be exercised.
     (k) "Fair Market Value" of a Share as of a specified date 
means the closing price at which Shares are traded at the close 
of business on such date as reported in the New York Stock 
Exchange composite transactions published in the Western Edition 
of the Wall Street Journal, or if no trading of Shares is 
reported for that day, on the next preceding day on which 
trading was reported.
     (l) "Incentive Stock Option" means an Option described in 
Code section 422(b).
     (m) "Misconduct" means that a Participant has engaged in 
unfair competition with the Corporation or a Subsidiary, induced 
any customer of the Corporation or a Subsidiary to breach any 
contract with the Corporation or a Subsidiary, made any 
unauthorized disclosure of any of the secrets or confidential 
information of the Corporation or a Subsidiary, committed an act 
of embezzlement, fraud or theft with respect to the property of
the Corporation or a Subsidiary, or engaged in conduct which is

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not in good faith and which directly results in material loss,
damage or injury to the business, reputation or employees of the 
Corporation or a Subsidiary.
     (n) "Nonqualified Stock Optiona" means an Option not 
described in Code section 422(b) or 423(b).
     (o) "Option" means a stock option granted pursuant to
Section 7 or Section 10. "Option Agreement" means the agreement
between the Corporation and the Participant which contains the 
terms and conditions pertaining to such Option.
     (p) "Other Share-Based Award" means an Award granted
pursuant to Section 9. "Other Share-Based Award Agreement" 
means the agreement between the Corporation and the recipient of 
an Other Share-Based Award which contains the terms and 
conditions pertaining to the Other Share-Based Award.
     (q) "Outside Director" means a Director who is not an 
Employee.
     (r) "Participant" means an Employee who has received an 
Award or an Outside Director who has received an Option.
     (s) "Plan" means this Potlatch Corporation 1995 Stock 
Incentive Plan.
     (t) "Purchase Price" means the Exercise Price times the
number of whole Shares with respect to which an Option is 
exercised.
     (u) "Restricted Stock" means Shares granted pursuant to 
Section 8. "Restricted Stock Agreement" means the agreement
between the Corporation and the recipient of Restricted Stock

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which contains the terms, conditions and restrictions pertaining 
to the Restricted Stock.
     (v) "Share" means one share of Common Stock, adjusted in 
accordance with Section 13 (if applicable).
     (w) "Stock Right" means a bookkeeping entry representing a 
right to the equivalent of one Share.
     (x) "Subsidiary" means any corporation in an unbroken 
chain of corporations beginning with the Corporation if each of 
the corporations other than the last corporation in the unbroken 
chain owns stock possessing 50% or more of the total combined 
voting power of all classes of stock in one of the other 
corporations in such chain.

     3. EFFECTIVE DATE.

     This Plan was adopted by the Board on December 7, 1995, to 
be effective immediately, subject to approval by the 
Corporation's stockholders.

     4. ADMINISTRATION.

     The Plan shall be administered by a committee (the
"Committee") appointed by the Board, consisting of not less than 
two disinterested members.  The term "disinterested members" as 
applied to Directors shall include only Directors who are not 
active Employees of the Corporation or of any of its 
Subsidiaries, who are not eligible to receive discretionary 
Awards under Sections 7, 8 and 9 of this Plan or under any other 
stock incentive plan of the Corporation and who have not

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received such discretionary Awards for at least one year 
preceding appointment as a member of the Committee. The Board 
may from time to time remove members from, or add members to, 
the Committee.  Vacancies on the Committee shall be filled by 
the Board. The Board shall appoint one of the members of the
Committee as Chairman.

     If any member of the Committee does not qualify as an
"outside director" for purposes of section 162(m) of the Code, 
Awards under the Plan for the chief executive officer and the 
four most highly compensated officers of the Corporation (other 
than the chief executive officer) shall be administered by a 
subcommittee consisting of each Committee member who qualifies 
as an "outside director." If fewer than two Committee members 
qualify as "outside directors," the Board shall appoint one or
more other members to such subcommittee who do qualify as
"outside directors" so that it will at all times consist of at 
least two members who qualify as "outside directors" for 
purposes of section 162(m) of the Code.

     The Committee shall hold meetings at such times and places 
as it may determine. Acts of a majority of the Committee at 
which a quorum is present, or acts reduced to or approved in 
writing by a majority of the Committee, shall be the valid acts 
of the Committee. The Committee shall from time to time at its 
discretion make determinations with respect to Employees who 
shall be granted Awards, the number of Shares or Share
equivalents to be subject to each Award, the vesting of Awards, 
the designation of Options as Incentive Stock Options or

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Nonqualified Stock Options and other conditions of Awards to 
Employees.

     The interpretation and construction by the Committee of any 
provisions of the Plan or of any Award shall be final. No 
member of the Committee shall be liable for any action or 
determination made in good faith with respect to the Plan or any 
Award.

     5. ELIGIBILITY.

     Participants shall be such key Employees (who may be
officers, whether or not they are Directors) of the Corporation 
or of its Subsidiaries as the Committee shall select, but 
subject to the terms and conditions set forth below. In 
addition, all Outside Directors shall be Participants solely for 
purposes of the nondiscretionary Awards described in Section 10.

     (a) Ten Percent Stockholders.

     An Employee who owns more than 10% of the total combined 
voting power of all classes of outstanding stock of the 
Corporation, its parent or any of its Subsidiaries is not 
eligible to receive an Incentive Stock Option pursuant to this 
Plan. For purposes of this Section 5(a) the stock ownership of 
an Employee shall be determined pursuant to section 424(d) of 
the Code.

     (b) Number of Awards.

     A Participant may receive more than one Award, including 
Awards of the same type, but only on the terms and subject to 
the restrictions set forth in the Plan. The maximum aggregate

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number of Shares or Share equivalents that may be subject to 
Awards to a Participant in any calendar year is 60,000 Shares.

     6. STOCK.

     The stock subject to Options, Restricted Stock, or Other 
Share-Based Awards granted under the Plan shall be Shares of the 
Corporation's authorized but unissued or reacquired Common 
Stock. The aggregate number of Options, Restricted Stock or 
Other Share-Based Awards issued under this Plan shall not exceed 
1,700,000 Shares. In the event that any outstanding Option 
under the Plan for any reason expires or is terminated or any 
Restricted Stock or Other Share-Based Award is forfeited, the 
Shares allocable to the unexercised portion of such Option or
the forfeited Restricted Stock or Other Share-Based Award may 
again be subjected to Options, Restricted Stock or Other 
Share-Based Awards under the Plan, provided that under the terms
of the Award the Participant received no benefits of ownership 
during the period the Award was outstanding.  However, if one 
Award is granted in tandem with another, so that the exercise of
one causes the other to expire, then the number of Shares   
subject to the expired Award shall not be restored to the pool
available for Awards.

     The limitations established by this Section 6 shall be 
subject to adjustment as provided in Section 13.

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     7. TERMS AND CONDITIONS OF EMPLOYEE OPTIONS.

     Options granted to Employees pursuant to the Plan shall be 
evidenced by written Option Agreements in such form as the 
Committee shall determine, subject to the following terms and 
conditions:

     (a) Number of Shares.

     Each Option shall state the number of Shares to which it 
pertains and shall provide for the adjustment of such number in 
accordance with Section 13.

     (b) Exercise Price.

     Each Option shall state the Exercise Price, determined by 
the Committee, which shall not be less than the Fair Market 
Value of a Share on the date of grant.

     (c) Medium and Time of Payment.

     The Purchase Price shall be payable in full in United 
States dollars upon the exercise of the Option; provided that
with the consent of the Committee and in accordance with its 
rules and regulations, the Purchase Price may be paid by the 
surrender of Shares in good form for transfer, owned by the 
person exercising the Option and having a Fair Market Value on 
the date of exercise equal to the Purchase Price, or in any 
combination of cash and Shares, so long as the total of the cash 
and the Fair Market Value of the Shares surrendered equals the
Purchase Price. No Share shall be issued until full payment has 
been made.

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     (d) Term and Exercise of Options; Nontransferability of
         Options. 

     Each Option shall state the time or times when it becomes 
exercisable. No Option shall be exercisable after the 
expiration of 10 years from the date it is granted. During the 
lifetime of the Participant, the Option shall be exercisable 
only by the Participant and shall not be assignable or 
transferable.  In the event of the Participant's death, no 
Option shall be transferable by the Participant other than by 
will or the laws of descent and distribution. 

     Subject to the foregoing, beginning six months after the 
date of grant the Participant shall have the right to exercise 
the Option (or to call the related stock appreciation right as 
described in Section 7(i)) in whole or in part:

          (i) Within 30 days following the consummation of 
     any transaction approved by the stockholders of the 
     Corporation in which the Corporation will cease to be 
     an independent publicly owned corporation (including, 
     without limitation, a reverse merger transaction in
     which the Corporation becomes the subsidiary of
     another corporation) or the sale or other disposition 
     of all or substantially all of the assets of the 
     Corporation;

          (ii) Within 365 days following the date on which
     more than one-third (determined by rounding down to 
     the next whole number) of the Directors neither 
     (A) were Directors on a date three years earlier nor

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     (B) are individuals whose election or nomination for
     election as Directors was affirmatively voted on by at 
     least a majority of those Directors described in (A) 
     above who were still in office as of the date the 
     Board approved such election or nomination;

          (iii) Within 365 days following the date on
     which any "person" (as such term is used in
     sections 13(d) and 14(d) of the Securities Exchange 
     Act of 1934, as amended (the "1934 Act")) that has 
     acquired Shares pursuant to a tender offer subject to 
     section 14(d) of the 1934 Act becomes entitled to vote 
     20% or more of the aggregate voting power of the 
     capital stock of the Corporation issued and 
     outstanding; and 
     
          (iv) within 30 days prior to any dissolution or
     liquidation of the Corporation or any merger or
     consolidation in which the Corporation is not the
     surviving corporation, but not earlier than the date 
     on which any required stockholder approval is 
     obtained. 

If an Option is not exercised during any 30-day period described 
in (i) or (iv) above, the Option shall terminate at the close of 
business on the last day of the 30-day period; provided that if 
periods described in (i) and (iv) above are contiguous or 
overlap, unexercised Options shall terminate at the close of 
business on the last day of the second 30-day period. In the 
case of a stock appreciation right called during either of the

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30-day periods described in (i) or (iv) above, "Fair Market 
Valuer" shall be the greater of (A) the value of the
consideration per share that the Participant would have received 
in connection with such transaction as a stockholder of the 
Corporation if he or she had exercised the Option prior to the 
consummation of the transaction described in (i) or (iv) above, 
or (B) the value determined in good faith by the Committee (as 
composed on the day preceding the date of consummation of the
transaction described in (i) or (iv) above), taking into consid-
eration all relevant facts and circumstances.

     (e) Termination of Employment Except Death.

     In the event that a Participant who is an Employee ceases 
to be employed by the Corporation or its Subsidiaries for any 
reason other than death, such Participant shall have the right 
(subject to the limitations of Section 7(d) above) to exercise 
the Option within three months after such termination of 
employment (36 months in the case of Early, Normal or Late
Retirement under the Salaried Employees Retirement Plan or
Disability), to the extent that, at the date of termination of 
employment, the Option had vested pursuant to the terms of the 
Option Agreement with respect to which such Option was granted 
and had not previously been exercised. However, if the 
employment of a Participant is terminated by the Corporation or 
a Subsidiary by reason of Misconduct, such Option shall cease to 
be exercisable at the time of the Participant's termination of
employment. The Committee shall determine whether a
Participant's employment is terminated by reason of Misconduct.

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In making such determination the Committee shall act fairly and 
shall give the Participant an opportunity to be heard and 
present evidence on his or her behalf.

     For this purpose, the employment relationship will be 
treated as continuing while the Participant is on military 
leave, sick leave or other bona fide leave of absence (to be 
determined in the sole discretion of the Committee, in 
accordance with rules and regulations construing Code section 
422(a)(2)). Notwithstanding the foregoing, in the case of an 
Incentive Stock Option, employment shall not be deemed to 
continue beyond the 90th day after the Participant ceased active 
employment, unless the Participant's reemployment rights are
guaranteed by statute or by contract.

     (f) Death of Participant.

     If a Participant who is an Employee dies while in the 
employ of the Corporation or a Subsidiary, the Option may be
exercised (subject to the limitations of Section 7(d) above) 
within 36 months after the Participant's death by the executors 
or administrators of the Participant's estate or by any person 
or persons who acquired the Option directly from the Participant 
by bequest or inheritance, to the extent that, at the date of 
the Participant's death, the Option had vested pursuant to the
terms of the Option Agreement and had not previously been 
exercised.

     (g) Rights as a Stockholder.

     A Participant or a transferee of a Participant shall have 
no rights as a stockholder with respect to any Shares covered by

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his or her Option until the date of the issuance of a stock
certificate for such Shares. No adjustment shall be made for 
dividends, distributions or other rights for which the record 
date is prior to the date such stock certificate is issued, 
except as provided in Section 13.

     (h) Modification, Extension and Renewal of Options.

     Subject to the terms and conditions and within the
limitations of the Plan, the Committee may modify, extend or 
renew outstanding Options granted to Employees under the Plan, 
or accept the exchange of outstanding Options (to the extent not 
previously exercised) for the granting of new Options (at the 
same or a different price).  Notwithstanding the foregoing, 
however, no modification of an Option shall, without the consent 
of the Participant, alter or impair any rights or obligations
under any Option previously granted under the Plan.

     (i) Stock Appreciation Rights.

     Each Option granted under the Plan shall include a stock 
appreciation right which may be exercised only during the 
periods described in Section 7(d)(i) through (iv) and subject to 
the provisions of Section 7(d).  During any such period, the 
Participant shall have the right to surrender all or part of the
Option and to exercise the stock appreciation right (the "call") 
to obtain payment of an amount equal to the difference obtained 
by subtracting the aggregate Exercise Price of the Shares 
subject to the Option (or the portion of such Option) 
surrendered from the Fair Market Value of such Shares on the 
date of such surrender. The call of such stock appreciation

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right shall be subject to such limitations (including, but not 
limited to, limitations as to time and amount) as the Committee 
shall deem appropriate. The payment may be made in shares of 
Common Stock (determined with reference to its Fair Market Value 
on the date of call), or in cash, or partly in cash and in 
shares of Common Stock, at the discretion of the Committee, pro-
vided that the Committee determines that such settlement is 
consistent with the purpose set forth in Section 1. For all 
purposes under the Plan, the terms "exercise" or "exercisable"
shall be deemed to include the terms "call" or "callable" as
such terms may apply to a stock appreciation right, and in the 
event of the call of a stock appreciation right, the underlying 
Option will be deemed to have been exercised for all purposes 
under the Plan.

     (j) Limitation of Incentive Stock Option Awards.

     The aggregate Fair Market Value (determined as of the date 
the Option is granted) of the stock with respect to which any 
Incentive Stock Options are exercisable for the first time by a
Participant during any calendar year under this Plan and all 
other plans maintained by the Corporation, its parent or its
Subsidiaries shall not exceed $100,000.

     (k) Other Provisions.

     The Option Agreements shall contain such other provisions 
that are consistent with the terms of the Plan, including, 
without limitation, restrictions upon the exercise of the 
Option, as the Committee shall deem advisable.

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     8. RESTRICTED STOCK.

     (a) Grants.

     Subject to the provisions of the Plan, the Committee shall
have sole and complete authority to determine the Employees to 
whom, and the time or times at which, grants of Restricted Stock 
will be made, the number of shares of Restricted Stock to be 
awarded, the price (if any) to be paid by the recipient of 
Restricted Stock, the time or times within which such Awards may 
be subject to forfeiture, and all other terms and conditions of 
the Awards. The Committee may condition the grant of Restricted 
Stock upon the attainment of specified performance goals or such 
other factors as the Committee may determine, in its sole 
discretion.

     The terms of each Restricted Stock Award shall be set forth 
in a Restricted Stock Agreement between the Corporation and the 
Employee, which Agreement shall contain such provisions as the 
Committee determines to be necessary or appropriate to carry out 
the intent of the Plan. Each Participant receiving a Restricted 
Stock Award shall be issued a stock certificate in respect of 
such shares of Restricted Stock. Such certificate shall be
registered in the name of such Participant, and shall bear an 
appropriate legend referring to the terms, conditions, and 
restrictions applicable to such Award. The Committee shall 
require that stock certificates evidencing such shares be held 
by the Corporation until the restrictions lapse and that, as a 
condition of any Restricted Stock Award, the Participant shall

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deliver to the Corporation a stock power relating to the stock 
covered by such Award.

     (b) Restrictions and Conditions.

     The shares of Restricted Stock awarded pursuant to this 
Section 8 shall be subject to the following restrictions and 
conditions:

          (i) During a period set by the Committee
     commencing with the date of such Award (the
     "Restriction Period"), the Participant shall not be
     permitted to sell, transfer, pledge, assign or
     encumber shares of Restricted Stock awarded under the 
     Plan. Within these limits, the Committee, in its sole 
     discretion, may provide for the lapse of such 
     restrictions in installments and may accelerate or 
     waive suchrestrictions in whole or in part, based on
     service, performance, a change of control of the
     Corporation or such other factors or criteria as the
     Committee may determine in its sole discretion.

          (ii) Except as provided in this paragraph (ii) 
     and paragraph (i) above, the Participant shall have, 
     with respect to the shares of Restricted-Stock, all of 
     the rights of a stockholder of the Corporation, 
     including the right to vote the shares and the right 
     to receive any cash dividends. The Committee, in its
     sole discretion, as determined at the time of Award, 
     may provide that the payment of cash dividends shall 
     or may be deferred and, if the Committee so

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     determines, reinvested in additional Shares of
     Restricted Stock to the extent available under
     Section 6, or otherwise reinvested. Stock dividends 
     issued with respect to Restricted Stock shall be 
     treated as additional shares of Restricted Stock that 
     are subject to the same restrictions and other terms 
     and conditions that apply to the shares with respect 
     to which such dividends are issued.

          (iii) The Committee shall specify the conditions 
     under which shares of Restricted Stock shall vest or 
     be forfeited and such conditions shall be set forth in 
     the Restricted Stock Agreement.

          (iv) If and when the Restriction Period
     applicable to shares of Restricted Stock expires
     without a prior forfeiture of the Restricted Stock, 
     certificates for an appropriate number of unrestricted 
     Shares shall be delivered promptly to the Participant, 
     and the certificates for the shares of Restricted 
     Stock shall be canceled.

     9. OTHER SHARE-BASED AWARDS.

     (a) Grants. 

     Other Awards of Shares and other Awards that are valued in 
whole or in part by reference to, or are otherwise based on, 
Shares ("Other Share-Based Awards"), may be granted either alone 
or in addition to or in conjunction with other Awards under this 
Plan. Awards under this Section 9 may include (without

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limitation) Stock Rights, the grant of Shares conditioned upon 
some specified event, the payment of cash based upon the
performance of the Shares or the grant of securities convertible 
into Shares.

     Subject to the provisions of the Plan, the Committee shall 
have sole and complete authority to determine the Employees to 
whom and the time or times at which Other Share-Based Awards 
shall be made, the number of Shares or other securities, if any, 
to be granted pursuant to Other Share-Based Awards, and all 
other conditions of the Other Share-Based Awards. The Committee 
may condition the grant of an Other Share-Based Award upon the 
attainment of specified performance goals or such other factors 
as the Committee shall determine, in its sole discretion. In
making an Other Share-Based Award, the Committee may determine 
that the recipient of an Other Share-Based Award shall be 
entitled to receive, currently or on a deferred basis, interest 
or dividends or dividend equivalents with respect to the Shares 
or other securities covered by the Award, and the Committee may
provide that such amounts (if any) shall be deemed to have been 
reinvested in additional Shares or otherwise reinvested. The 
terms of any Other Share-Based Award shall be set forth in an 
Other Share-Based Award Agreement between the Corporation and 
the Employee, which Agreement shall contain such provisions as 
the Committee determines to be necessary or appropriate to carry 
out the intent of the Plan.

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     (b) Terms and Conditions. 

     In addition to the terms and conditions specified in the 
Other Share-Based Award Agreement, Other Share-Based Awards 
shall be subject to the following:

          (i) Any Other Share-Based Award may not be sold, 
     assigned, transferred, pledged or otherwise encumbered 
     prior to the date on which the Shares are issued or 
     the Award becomes payable, or, if later, the date on 
     which any applicable restriction, performance or 
     deferral period lapses.

          (ii) The Other Share-sased Award Agreement shall 
     contain provisions dealing with the disposition of 
     such Award in the event of termination of the 
     Employee's employment prior to the exercise, 
     realization or payment of such Award, and the 
     Committee in its sole discretion may provide for 
     payment of the Award in the event of the Employee's 
     retirement, Disability or death or the change of 
     control of the Corporation, with such provisions to 
     take account of the specific nature and purpose of the
     Award.

     10. OPTION AWARDS TO OUTSIDE DIRECTORS. 

     (a) Initial Award Conditioned Upon Plan Approval. 
     
     Subject to the approval of the Plan by the stockholders of 
the Corporation, each individual who is an Outside Director on

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December 7, 1995, shall receive a Nonqualified Stock Option for 
1000 Shares as of such date. 

     (b) Award Upon Election. 

     Each Outside Director who is elected by the Board to fill a 
vacancy on the Board after December 7, l995, shall receive a 
Nonqualified Stock Option for 1000 Shares on the date of the 
Board's regular meeting in December following his or her
election. 

     (c) Annual Awards. 

     Each Outside Director shall receive a Nonqualified Stock 
Option for 500 Shares on the date of the Board's regular meeting 
in December of each year he or she serves as Outside Director, 
other than a year in which the Outside Director receives an 
award under Section 10(a) or 10(b) above. 

     (d) Terms and Conditions of Options. 

     Each Nonqualified Stock Option granted pursuant to this 
Section 10 shall be subject to the following terms and
conditions:

          (i) The Exercise Price shall be the Fair Market 
     Value of a Share on the date of grant.

          (ii) The Option shall become exercisable in 50% 
     increments on the first and second anniversaries of 
     the date of grant, provided the Outside Director has 
     continuously been an Outside Director from the date of 
     grant until such time.

          (iii) In the event the Outside Director terminates 
     services as a Director for any reason other than

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     death, the former Director shall have the right to
     exercise the Option within three months after such
     termination (within 36 months after such termination 
     in the case of retirement after five years of service 
     as an Outside Director) to the extent that, at the 
     date of termination the Option had vested pursuant to 
     (ii) above and had not previously been exercised. 
     However, if the services of the Outside Director are 
     terminated by the Board for cause in accordance with 
     the Corporation's Restated Certificate of Incorpora-
     tion, such Option shall cease to be exercisable at the 
     time of the Outside Director's termination of
     services.


          (iv) In the event the Outside Director's services
     terminate by reason of death, the Option may be 
     exercised within 36 months after the Director's death 
     by the executors or administrators of the Director's 
     estate or by any person or persons who shall have 
     acquired the Option directly from the Director by 
     bequest or inheritance, to the extent that, at the 
     date of the Director's death, the Option had vested 
     pursuant to (ii) above and had not previously been 
     exercised. 

Except as specifically set forth in (i) through (iv) above, each
Nonqualified Stock Option granted pursuant to this Section 10 
also shall be subject to all of the terms and conditions set 
forth in Section 7, other than Section 7(h).

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     11. OTHER PAYMENTS IN SHARES.

     Shares may be issued under this Plan to satisfy the payment 
of all or part of an award pursuant to the Potlatch Corporation 
Management Performance Award Plan.  In addition, all or part of 
any Directors fees may be paid in Shares issued under this 
Plan. Any Shares issued pursuant to this Section 11 shall 
reduce the number of Shares authorized for Options, Restricted 
Stock or Other Share-Based Awards under Section 6 but shall not 
be considered an Award for purposes of the maximum grant
limitation in Section 5(b).

     12. TERM OF PLAN.

     Awards may be granted and Shares may be issued pursuant to 
the Plan until the termination of the Plan on December 6, 2005.

     13. RECAPITALIZATION.

     Subject to any required action by the stockholders, the 
number of Shares covered by this Plan as provided in Section 6, 
the maximum grant limitation in Section 5(b), the number of 
Shares covered by or referenced in each outstanding Award, the 
number of Options to be granted to Outside Directors under 
Sections 10(a) through 10(c) and the Exercise Price of each 
outstanding Option and any price required to be paid for 
Restricted Stock or Other Share-Based Award shall be proportion-
ately adjusted for any increase or decrease in the number of 
issued Shares resulting from a subdivision or consolidation of 
Shares, the payment of a stock dividend (but only of Common

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<PAGE>
Stock) or any other increase or decrease in the number of such 
Shares effected without receipt of consideration by the 
Corporation or the declaration of a dividend payable in cash 
that has a material effect on the price of issued Shares.

     Subject to any required action by the stockholders, if the 
Corporation shall be the surviving corporation in any merger, 
consolidation or other reorganization, each outstanding Award 
shall pertain and apply to the securities to which a holder of 
the number of Shares subject to the Award would have been 
entitled. Subject to the provisions of Section 7(d), a 
dissolution or liquidation of the Corporation or a merger, 
consolidation or other reorganization in which the Corporation 
is not the surviving corporation shall cause each outstanding
Option and each nonvested Restricted Stock Award or Other
Share-Based Award to terminate, unless the agreement of merger, 
consolidation or reorganization shall otherwise provide. In the 
event that the Corporation undergoes a reverse merger 
transaction, the Participant shall be entitled to receive the 
same consideration in such transaction with respect to his or 
her Award (including, without limitation, cash) as other 
stockholders are entitled to receive.

     In the event of a change in the Common Stock as presently 
constituted, which is limited to a change of all of its 
authorized shares with par value into the same number of shares 
with a different par value or without par value, the shares 
resulting from any such change shall be deemed to be the Common 
Stock within the meaning of the Plan.

                                     -23-

<PAGE>
     To the extent that the foregoing adjustments relate to
stock or securities of the Corporation, such adjustments shall 
be made by the Committee, whose determination in that respect 
shall be final, binding and conclusive, provided that each 
Incentive Stock Option granted pursuant to this Plan shall not 
be adjusted in a manner that causes the Option to fail to
continue to qualify as an incentive stock option within the
meaning of section 422 of the Code.

     Except as expressly provided in this Section 13, a
Participant shall have no rights by reason of any subdivision or 
consolidation of shares of stock of any class or the payment of 
any stock dividend or any other increase or decrease in the 
number of shares of stock of any class or by reason of any 
dissolution, liquidation, merger or consolidation or spin-off of 
assets or stock of another corporation, and any issue by the 
Corporation of shares of stock of any class or securities 
convertible into shares of stock of any class, shall not affect 
the number or price of Shares subject to the Option.

     The grant of an Option pursuant to the Plan shall not
affect in any way the right or power of the Corporation to make 
adjustments, reclassifications, reorganizations or changes of 
its capital or business structure or to merge or consolidate or 
to dissolve, liquidate, sell or transfer all or any part of its
business or assets.

                                     -24-

<PAGE>
14. SECURITIES LAW REQUIREMENTS AND LIMITATION OF RIGHTS.

     (a) Securities Law.

     No Shares shall be issued pursuant to the Plan unless and 
until the Corporation has determined that: (i) it and the Par-
ticipant have taken all actions required to register the Shares 
under the Securities Act of 1933 or perfect an exemption from 
registration; (ii) any applicable listing requirement of any 
stock exchange on which the Common Stock is listed has been
satisfied; and (iii) any other applicable provision of state or 
federal law has been satisfied.

     (b) Employment Rights.

     Neither the Plan nor any Award granted under the Plan shall 
be deemed to give any individual a right to remain employed by the 
Corporation or a Subsidiary or to remain a Director. The 
Corporation and its Subsidiaries reserve the right to terminate 
the employment of any employee at any time, with or without 
cause, subject only to a written employment contract (if any), 
and the Board reserves the right to terminate a Director's 
membership on the Board for cause in accordance with the
Corporation's Restated Certificate of Incorporation.

     (c) Stockholders' Rights.

     A Participant shall have no dividend rights, voting rights 
or other rights as a stockholder with respect to any Shares 
covered by his or her Award prior to the issuance of a stock 
certificate for such Shares. No adjustment shall be made for 
cash dividends or other rights for which the record date is 
prior to the date when such certificate is issued.

                                     -25-

<PAGE>
     (d) Creditors' Rights.

     A holder of an Other Share-Based Award shall have no rights 
other than those of a general creditor of the Corporation. An 
Other Share-Based Award shall represent an unfunded and 
unsecured obligation of the Corporation, subject to the terms 
and conditions of the applicable Other Share-Based Award
Agreement.


     15. AMENDMENT OF THE PLAN.

     The Board may suspend or discontinue the Plan or revise or 
amend it with respect to any Shares at the time not subject to 
Awards except that, without approval of the stockholders of the 
Corporation, no such revision or amendment shall:

          (a) Increase the number of Shares subject to the
     Plan;

          (b) Change the designation in Section 5 of the class
     of Employees eligible to receive Awards;

          (c) Decrease the price at which Incentive Stock 
     Options may be granted;

          (d) Remove the administration of the Plan from the
     Committee;

          (e) Render any disinterested member of the Committee 
     eligible to receive a discretionary Award under Sections 7, 
     8 and 9 while serving on the Committee;

          (f) Change the provisions of Section 10 more than 
     once in any six-month period, other than to comply with 
     changes in the Code or the rules thereunder; or

                                     -26-

<PAGE>
          (g) Amend this Section 15 to defeat its purpose.

     16. APPLICATION OF FUNDS.

     The proceeds received by the Corporation from the sale of 
Common Stock pursuant to the exercise of an Option or the grant 
of Restricted Stock will be used for general corporate purposes.

     17. NO OBLIGATION TO EXERCISE OPTION.

     The granting of an Option shall impose no obligation upon 
the Participant to exercise such Option.

     18. APPROVAL OF STOCKHOLDERS.

     This Plan and any amendments requiring stockholder approval 
pursuant to Section 15 shall be subject to approval by 
affirmative vote of the stockholders in accordance with 
applicable law. Such vote shall be taken at the first annual 
meeting of stockholders of the Corporation following the 
adoption of the Plan or of any such amendments, or any 
adjournment of such meeting.

     19. LIMITATION ON PLAN PAYMENTS.

     Any provision of the Plan to the contrary notwithstanding, 
payments or transfers to a Participant under the Plan shall be 
limited to the amount (the "Capped Amount") necessary to avoid 
characterization of any amount payable to the Participant 
(including, but not limited to, amounts payable under the Plan) 
as an "excess parachute payment" as defined in Code section

                                     -27-


<PAGE>
280G, except in the event that the total amount that the
Participant would receive from all "parachute payments" as
defined in Code section 280G, net of all applicable taxes, 
including the excise tax that would be imposed pursuant to Code 
section 4999, would exceed the Capped Amount, net of all 
applicable taxes.

     The determination of whether any amount would constitute an 
"excess parachute payment" shall be made by the firm of 
independent certified public accountants serving as the outside 
auditor of the Corporation as of the date of the event specified 
in Section 7(d)(i) through (iv). In making such determination, 
such firm may disregard any payments or benefits available to 
the Participant under any contract, plan or program if the
Participant irrevocably elects to relinquish or not exercise 
such payments or benefits before receipt of such payments or 
benefits. It is intended that payments shall be made under the 
Plan whether or not the status of a particular payment as an
"excess parachute payment" has been finally determined by the 
Internal Revenue Service or a court of competent jurisdiction.

     20. WITHHOLDING TAXES.

     (a) General.

     To the extent required by applicable law, the recipient of 
any payment or distribution under the Plan shall make arrange-
ments satisfactory to the Corporation for the satisfaction of 
any withholding tax obligations that arise by reason of such 
payment or distribution.  The Corporation shall not be required

                                     -28-

<PAGE>
to make such payment or distribution until such obligations are 
satisfied.

     (b) Nonqualified Options.

     The Committee may permit a Participant who exercises
Nonqualified Stock Options to satisfy all or part of his or her 
withholding tax obligations by having the Corporation withhold a 
portion of the Shares that otherwise would be issued to him or 
her under such Nonqualified Stock Options. Such Shares shall be 
valued at their Fair Market Value on the date when taxes
otherwise would be withheld in cash. The payment of withholding 
taxes by surrendering Shares to the Corporation, if permitted by 
the Committee, shall be subject to such restrictions as the 
Committee may impose, including any restrictions required by 
rules of the Securities and Exchange Commission.

     21. EXECUTION.

     To record the adoption of the Plan effective as of 
December 7, 1995, the Corporation has caused its authorized 
officer to execute the same this_________ day of_____________,
1995.

                              POTLATCH CORPORATION

                              BY____________________________



                                     -29-