----

| 4. | (a) |   | For      purposes of making the computations described herein, MGHI and all lower      (with respect to MGHI) tier entities, including newly-formed Restricted      Subsidiaries but excluding Salmon Creek Corporation, (individually and      collectively referred to as "MGHI Subgroup Subsidiary" or "MGHI Subgroup      Subsidiaries") in which MGHI has direct or indirect ownership shall be      treated as an affiliated group of corporations (the "MGHI Subgroup"), the      common parent of which is MGHI, provided, however, that the MGHI Subgroup      shall only include any MGHI Subgroup Subsidiary to the extent that such      MGHI Subgroup Subsidiary meets the test of affiliation under Section 1504      of the Code as it would apply to the MGHI Subgroup. MGHI and each MGHI      Subgroup Subsidiary shall sometimes be referred to as "MGHI Subgroup      Members". |
|----|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | The      tax liability required of MGHI shall be equal to MGHI's Tentative Tax      Liability (as hereinafter defined) minus MGI's Tentative Tax Liability (as      determined under the Revised MGIAgreement). |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | The      computation of the Federal income tax liability of MGHI shall take into      account the taxable income, loss, credits and other tax attributes of each      MGHI Subgroup Subsidiary as if MGHI filed a consolidated return with each      MGHI Subgroup Subsidiary (taking into account all applicable limitations      under the Code) ("MGHI's Tentative Tax Liability").  In      calculating such liability, all intercompany transactions between MGHI      Subgroup Members shall be treated consistent with the consolidated return      Treasury Regulations. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | To      the extent that MGHI's Tentative Tax Liability is less than MGI's      Tentative Tax Liability, Parent shall pay the amount of such difference to      MGHI. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (e) | For      purposes of Section 4(c) of this Agreement, any net operating loss      carryforwards available to the MGI Subgroup on the date hereof under the      Revised MGI Agreement shall be available to offset income of the MGHI      Subgroup in the same manner as under the Revised MGI      Agreement. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (f) | If      the calculation of MGHI's Tentative Tax Liability in Section 4(c) results      in a net operating loss that can be carried back to a prior taxable period      or periods with respect to which MGHI made payments to Parent under this      Agreement, then, in that event, Parent shall pay MGHI an amount equal to      the tax refund to which MGHI would have been entitled consistent with this      Section 4. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (g) | If      the calculation of MGHI's Tentative Tax Liability in Section 4(c) results      in a net operating loss that cannot be carried back pursuant to the      preceding subsection (f), then, in that event, such net operating loss      shall be a net operating loss carryover to be used by the MGHI Subgroup in      computing its Federal income tax liability pursuant to the preceding      subsection (c) for future taxable periods, under the law applicable to net      operating loss carryovers ingeneral. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| MAXXAM Inc.                     |                        |   |
|---------------------------------|-----------------------------|--------|
|                            |                        |   |
| By:                             | /s/      RONALD L. REMAN    |   |   |
| Name:                           | Ronald      L. Reman        |   |   |
| Title:                          | Vice      President - Taxes |   |   |
|                            |                        |   |   |
| MAXXAM Group Holdings      Inc. |                        |   |
|                            |                        |   |
| By:                             | /s/      TERRY FREEMAN      |   |   |
| Name:                           | Terry      Freeman          |   |   |
| Title:                          | Assistant      Controller   |   |   |

----