Document:

exv10w25

 

Exhibit 10.25

PORTIONS
OF THIS EXHIBIT MARKED BY ***
HAVE BEEN OMITTED PURSUANT TO A
REQUEST
FOR CONFIDENTIAL TREATMENT FILED SEPARATELY
WITH THE
SECURITIES AND EXCHANGE COMMISSION

PULPWOOD SUPPLY AGREEMENT

BY AND BETWEEN

TIN INC., as Purchaser 

AND 

CPT LOGCO, LLC, as Seller

 

 

Table of Contents

	 	 	 	 	 	 	 
	ARTICLE I DEFINITIONS	 	1
	 
	 	Section 1.1	 	Definitions	 	1
	ARTICLE II HARVEST VOLUMES	 	7
	 
	 	Section 2.1	 	Obligation to Purchase and Sell	 	7
	 
	 	Section 2.2	 	Annual Plan and Forecast Plan	 	7
	 
	 	Section 2.3	 	Obligated Volume	 	7
	 
	 	Section 2.4	 	Uncommitted Volume and Quarterly Meetings	 	8
	 
	 	Section 2.5	 	Biomass	 	8
	 
	 	Section 2.6	 	Post-Harvest Carbon Rights	 	8
	ARTICLE III PRODUCT SPECIFICATIONS	 	9
	 
	 	Section 3.1	 	Product Specifications	 	9
	 
	 	Section 3.2	 	Rejected Product	 	9
	ARTICLE IV PRICE SCHEDULE	 	9
	 
	 	Section 4.1	 	Base Price	 	9
	 
	 	Section 4.2	 	Quarterly Price	 	9
	ARTICLE V DELIVERY, FORCE MAJEURE AND PAYMENT	 	10
	 
	 	Section 5.1	 	Delivery, Scaling and Weighing 	 	10
	 
	 	Section 5.2	 	Force Majeure	 	12
	 
	 	Section 5.3	 	Change in Mill Operations	 	13
	 
	 	Section 5.4	 	Payment	 	13
	ARTICLE VI TERM	 	13
	 
	 	Section 6.1	 	Term 	 	13
	 
	 	Section 6.2	 	Extension of Term	 	14
	 
	 	Section 6.3	 	Termination	 	14
	 
	 	Section 6.4	 	Effect of Termination	 	14
	ARTICLE VII REPRESENTATIONS AND WARRANTIES	 	14
	 
	 	Section 7.1	 	Representations and Warranties of Purchaser	 	14
	 
	 	Section 7.2	 	Representations and Warranties of Seller	 	15
	ARTICLE VIII SELLER’S MANAGEMENT	 	16
	 
	 	Section 8.1	 	Seller’s Management	 	16
	ARTICLE IX DEFAULT AND DISPUTE RESOLUTION	 	17
	 
	 	Section 9.1	 	Default by Purchaser	 	17
	 
	 	Section 9.2	 	Default by Seller	 	17
	 
	 	Section 9.3	 	Specific Performance	 	18
	 
	 	Section 9.4	 	Liquidated Damages	 	18
	 
	 	Section 9.5	 	Assignment of Agreement	 	18
	 
	 	Section 9.6	 	Dispute Resolution	 	19
	ARTICLE X INDEMNITY AND INSURANCE	 	20
	 
	 	Section 10.1	 	Purchaser’s Indemnity	 	20
	 
	 	Section 10.2	 	Seller’s Indemnity	 	21
	 
	 	Section 10.3	 	Insurance	 	21
	 
	 	Section 10.4	 	Notice of Claim	 	22
	ARTICLE XI ASSIGNMENT AND TRANSFERS	 	22
	 
	 	Section 11.1	 	Seller’s Assignment Rights	 	22

-ii-

 

	 	 	 	 	 	 	 
	 
	 	Section 11.2	 	Purchaser’s Assignment Rights	 	22
	ARTICLE XII AUDIT RIGHTS	 	22
	 
	 	Section 12.1	 	Audit Rights	 	22
	ARTICLE XIII NOTICES	 	23
	 
	 	Section 13.1	 	Notices	 	23
	ARTICLE XIV MISCELLANEOUS	 	24
	 
	 	Section 14.1	 	Amendments	 	24
	 
	 	Section 14.2	 	Recording of Agreement	 	24
	 
	 	Section 14.3	 	Compliance with Laws	 	24
	 
	 	Section 14.4	 	Confidentiality	 	24
	 
	 	Section 14.5	 	Estoppel Certificates	 	24
	 
	 	Section 14.6	 	No Waiver; Remedies	 	25
	 
	 	Section 14.7	 	Accounting Terms	 	25
	 
	 	Section 14.8	 	Binding Effect; Governing Law	 	25
	 
	 	Section 14.9	 	Counterparts	 	25
	 
	 	Section 14.10	 	Time of the Essence	 	25
	 
	 	Section 14.11	 	Incorporation of Exhibits and Schedules	 	25
	 
	 	Section 14.12	 	Interest	 	25
	 
	 	Section 14.13	 	Further Assurances	 	25
	 
	 	Section 14.14	 	Most Favored Status	 	25
	 
	 	Section 14.15	 	Attorney’s Fees	 	26
	 
	 	Section 14.16	 	Severability	 	26
	 
	 	Section 14.17	 	Captions and Headings	 	26
	 
	 	Section 14.18	 	Construction	 	26
	 
	 	Section 14.19	 	Relationship	 	26
	 
	 	Section 14.20	 	Integration	 	27
	 
	 	Section 14.21	 	Uniform Commercial Code	 	27

INDEX

	 	 	 
	SCHEDULES	 	 
	Schedule 1

	 	Specifications
	Schedule 2

	 	2008 Annual Plan
	Schedule 3

	 	2008 Forecast Plan (for years 2009-2011)
	Schedule 4

	 	Allocation of Annual Harvest Volume
	Schedule 5

	 	Freight Adjustment
	Schedule 6

	 	Initial Price and Base Price
	Schedule 7

	 	Pricing Example
	Schedule 8

	 	Distinctive Sites
	Schedule 9

	 	Biomass Harvest Locations

	 	 	 
	EXHIBITS	 	 
	Exhibit A

	 	Description of Property
	Exhibit B

	 	Form of Support Agreement

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PULPWOOD SUPPLY AGREEMENT

     THIS PULPWOOD SUPPLY AGREEMENT (this “Agreement”) is made and entered into as of this
31st day of October, 2007 (the “Effective Date”) by and between TIN INC., a Delaware
corporation (“Purchaser”), and CPT LOGCO, LLC, a Delaware limited liability company (“Seller”).

RECITALS

	 	A.	 	Purchaser and Landowner entered into that certain Purchase Agreement dated August 3,
2007, as amended by that certain Amended and Restated Purchase Agreement dated October 31,
2007 (as amended, the “Purchase Agreement”), pursuant to which Purchaser sold and Crown
Pine Timber 1, L.P., a Delaware limited partnership, Crown Pine Timber 2, L.P., a Delaware
limited partnership, Crown Pine Timber 3, L.P., a Delaware limited partnership, and Crown
Pine Timber 4, L.P., a Delaware limited partnership (collectively, “Landowner”), acquired
approximately 1,469,507 acres of real property located in Anderson, Angelina, Cherokee,
Houston, Jefferson, Liberty, Nacogdoches, Orange, Panola, Rusk, San Jacinto, Shelby,
Trinity, Newton, Sabine, San Augustine, Hardin, Jasper, Polk and Tyler Counties, Texas; and
Allen, Beauregard, Calcasieu, Jefferson Davis, Rapides, Sabine and Vernon Parishes,
Louisiana, being more particularly described in Exhibit A attached hereto (the “Property”);
and
	 
	 	B.	 	Purchaser and Crown Pine Parent, L.P., a Delaware limited partnership, of which each
entity constituting Landowner is a wholly owned subsidiary, are simultaneously entering
into a Pulpwood Support Agreement substantially in the form attached hereto as Exhibit B
(the “Support Agreement”), pursuant to which Landowner is providing certain assurances and
agreements to Purchaser with respect to the availability of the cutting rights contemplated
and required by this Agreement; and
	 
	 	C.	 	Purchaser desires to buy and receive, and Seller desires to sell, deliver and provide
Product (as defined herein) from the Property; and
	 
	 	D.	 	Purchaser and Seller desire to purchase and sell Product pursuant to the terms of this
Agreement at the fair market price;

     IN CONSIDERATION of the mutual covenants contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser
hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Definitions. As used herein, the following terms will have the meanings ascribed
thereto:

     “AAA” means the American Arbitration Association.

 

 

     “Acts of God” means events which are caused solely by the effects of nature or natural causes,
without interference by any person, consisting of insect infestations, floods, earthquakes,
tornados, hurricanes, fires, lightening and extraordinary amounts of rain that materially and
adversely impact the ability to harvest timber.

     “Affiliate” means, with respect to any Person, another Person which, directly or indirectly,
controls, is controlled by, or is under common control with, the first Person.

     “Agreement” shall have the meaning provided in the first paragraph of this Agreement.

     “Annual Harvest Option Volume” means *** of the excess of the Annual Harvest Volume over the
Obligation Floor.

     “Annual Harvest Volume” means the volume of Product that Seller plans to harvest during a
Harvest Year as set forth in the Annual Plan for such Harvest Year.

     “Annual Juvenile Wood Percentage” means the proportion (expressed as a percentage) that the
volume of Juvenile Wood that Seller plans to harvest during a Harvest Year bears to the Annual
Harvest Volume for such Harvest Year, which proportion shall in no case exceed ***.

     “Annual Minimum Volume” means the volume of Product that Seller is obligated to make available
for harvest from the Property during a Harvest Year. The Annual Minimum Volume for each Harvest
Year is set forth on Schedule 4 attached hereto.

     “Annual Plan” means a written annual harvest plan prepared by Seller pursuant to Section 2.2
hereof detailing (i) the planned Annual Harvest Volume (by tract), (ii) tract locations for the
Product during a Harvest Year, and (iii) the volume of Juvenile Wood included within the Annual
Harvest Volume. An Annual Plan shall include stand data (including age of each stand) and a map of
each tract to be harvested during such Harvest Year; provided, however, Seller may substitute
tracts from the Property without notice to or consent of Purchaser so long as such substitution
does not result in increased cost or inconvenience to Purchaser.

     “Base Price” means the price for Product equal to the third (3rd) quarter price for
the Primary Delivery Zone set forth in *** as the average price for delivered pine pulpwood, ***.

     “Biomass” means standing trees (excluding Pulpwood and other merchantable timber) and/or
vegetation that can be commercially preharvested, or standing and down woody material and debris
existing after a harvesting operation.

     “Biomass Offer” has the meaning set forth in Section 2.5 hereof.

     “Carbon Rights” means any carbon sequestration credits or offsets, renewable energy credits or
similar method of attribution of a value, right or privilege for carbon sequestration that may be
used to satisfy limits on carbon dioxide emissions or to reduce taxes, assessments or penalties on
carbon dioxide emissions.

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     “Carryover Volume” has the meaning provided in Section 5.1(c) hereof.

     “Certificate of Insurance” means a written certification with respect to each party’s
insurance policies required hereunder by or on behalf of the insurance company or companies issuing
the insured party’s insurance policies stating, (i) the name of the insurance company or companies
issuing the insurance policy, (ii) the deductible amount, (iii) types of coverage, (iv) the premium
amount, (v) the expiration date, (vi) the policy limit or face amount, (vii) waiver of subrogation,
(viii) that the other party may rely on such certificate, and (ix) that such insurance policy shall
not be cancelled, amended or non-renewed without providing the other party with at least thirty
(30) days’ prior written notice.

     “Change Event” means (i) a closing of the Mill or an operating line within the Mill, (ii) the
sale of the Mill, or (iii) a material decrease in Purchaser’s requirements for Product as a result
of a change in a manufacturing process.

     “Conservation Block” means the conservation areas containing approximately *** acres described
on Exhibit A.

     “Delivery Plan” has the meaning set forth in Section 5.1(a) hereof.

     “Delivery Point” means the Mill or such other location at which the Product is delivered by
Seller, as shall be designated in the Delivery Plan described in Section 5.1(a), or by Purchaser in
Purchaser’s sole discretion from time to time.

     “Distinctive Site” means any site described on Schedule 8 attached hereto.

     “Effective Date” shall have the meaning provided in the first paragraph of this Agreement.

     “Environmental Laws” means any United States federal, state or local laws and the regulations
promulgated thereunder, relating to pollution or protection of the environment or to threatened or
endangered species, including laws relating to wetlands protection, laws relating to reclamation of
land and waterways and laws relating to emissions, discharges, disseminations, releases or
threatened releases of hazardous or toxic substances or petroleum (and its fractions) into the
environment (including, without limitation, ambient air, surface water, ground water, soil, land
surface or subsurface strata) or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of hazardous or toxic substances or
petroleum (and its fractions), including, without limitation, the following laws and regulations
promulgated thereunder as amended from time to time: (i) the Comprehensive Environmental Response,
Compensation and Liability Act (as amended by the Superfund Amendments and Reauthorization Act), 42
U.S.C. § 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et
seq.; (iii) the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq.; (iv) the Toxic
Substances Control Act, 15 U.S.C. § 2601 et seq.; (v) the Clean Water Act, 33 U.S.C. § 1251 et
seq.; (vi) the Clean Air Act, 42 U.S.C. § 1857 et seq.; and (vii) the Endangered Species Act, 16
U.S.C. §1531 et seq.; and (viii) all laws of the

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states in which the Property is located that are based on, or substantially similar to, the
federal statutes listed in parts (i) through (vii) of this paragraph.

     “Final Quarterly Price” means a price for Product, determined as of the end of any calendar
quarter during the term, as follows:

(i) if Purchaser purchased greater than *** of all of its product delivered to the Mill from
parties other than Seller during such calendar quarter (excluding the purchase of Substitute
Products, woodyard transactions, internal transactions, timber deeds and supply agreements
having a term in excess of ***), then the Final Quarterly Price for such calendar quarter
shall be equal to the weighted average price for all such deliveries by other parties; or

(ii) if Purchaser purchased *** or less of all of its Products from such other parties
described in subparagraph (i) of this definition during such calendar quarter, the Final
Quarterly Price for such calendar quarter shall equal the applicable *** average price for
delivered pine pulpwood for such calendar quarter, ***.

For both (i) and (ii) above, such weighted average shall exclude all deliveries to the Mill from
yard systems and all transactions: (x) with Seller pursuant to this Agreement, (y) non-market-based
or fixed price supply agreements, and (z) supply agreements in excess of one (1) year containing
price based on a mill weighted average cost, index, or other such indicators.

     “Force Majeure” means any cause, condition or event beyond the reasonable control of a party,
which the party in question, despite the use of good faith and commercially reasonable efforts, is
unable to overcome, that delays or prevents such party’s performance of its obligations hereunder,
consisting solely of war, war-like operations, invasions, rebellion, acts of terrorism, military or
usurped power, sabotage, acts of government, acts of public enemy, riots, fires, explosions, Acts
of God, labor strikes, disputes or lockouts by employees, general suspension of payments by banks
in the United States, and an involuntary ceasing of operations at the Mill for a minimum of thirty
(30) consecutive days. Force Majeure shall not include, (i) a party’s financial inability to
perform, (ii) non-violent, civil demonstrations, (iii) an act or omission arising from the willful
misconduct of the party claiming that a Force Majeure event has occurred, or (iv) any rainfall
which does not constitute an Act of God.

     “Forecast Plan” means a written harvest plan prepared by Seller pursuant to Section 2.2
detailing the forecasted Annual Harvest Volume during the two (2) Harvest Years immediately
following the Harvest Year in the Annual Plan delivered to Purchaser pursuant to Section 2.2, and,
for tracts to be harvested during the first Harvest Year set forth in any Forecast Plan,
designation of the geographic locations from which the Product will be harvested.

     “Freight Adjustment” means an increase or decrease in the applicable Quarterly Price or Final
Quarterly Price for Product delivered pursuant to this Agreement in accordance with the formula set
forth on Schedule 5; provided that the parties shall agree upon any adjustments to the Freight
Adjustment every *** year after the year of the Effective Date.

4

 

     “Harvest Year” means a calendar year beginning on January 1 and ending on December 31. The
first full “Harvest Year” of this Agreement shall begin on January 1, 2008 and end on December 31,
2008. The periods from the Effective Date to December 31, 2007 and from January 1 in the final
calendar year of the Term to the date the Term expires shall be deemed partial “Harvest Years.”

     “Initial Option Period” has the meaning set forth in Section 6.2 hereof.

     “Juvenile Wood” means Product which is less than *** years in age.

     “Liens” means any and all liens, charges, mortgages, deeds to secure debt, pledges, security
interests, options of record, adverse claims or other encumbrances of a liquidated amount or which
are otherwise statutorily enforceable, other than liens for ad valorem taxes not yet due and
payable.

     “Master Stumpage Agreement” means, collectively, those certain Master Pulpwood Stumpage
Agreements dated October 31, 2007, by and between Seller and each entity constituting Landowner,
with respect to the Property.

     “Mill” means the Orange Linerboard Mill located in Orange, Texas and any other mill that
Purchaser leases or in which Purchaser has an ownership interest exceeding forty-nine percent (49%)
in the States of Texas or Louisiana during the Term of this Agreement.

     “Obligated Volume” means the minimum volume of Product from the Property, determined by
Purchaser in accordance with Section 2.3, that Seller is required to deliver to Purchaser and
Purchaser is required to purchase during a Harvest Year in accordance with the terms of this
Agreement.

     “Obligation Floor” means, for any given Harvest Year, the smallest permissible Obligated
Volume, being *** tons of Product.

     “Option” has the meaning set forth in Section 6.2 hereof.

     “Panel” has the meaning set forth in Section 9.6(a) hereof.

     “Panel Chairman” has the meaning set forth in Section 9.6(a) hereof.

     “Person” means any individual, sole proprietorship, trust, estate, executor, legal
representative, unincorporated association, institution, corporation, company, partnership, limited
liability company, limited liability partnership, joint venture, government (whether national,
federal, state, county, city, municipal or otherwise, including, without limitation, any
instrumentality, division, agency, body or department thereof) or other entity.

     “Price Dispute” has the meaning set forth in Section 9.6(b) hereof.

5

 

     “Primary Delivery Zone” with respect to any Delivery Point means all those tracts of Property
located not more than *** road miles from such Delivery Point.

     “Product” means the Pulpwood harvested from the Property meeting the applicable
Specifications.

     “Property” shall have the meaning provided in Recital A of this Agreement.

     “Pulpwood” means pine roundwood, including topwood, customarily intended according to industry
standards to be chipped, shredded, flaked, ground or otherwise converted to make pulp, paper, or
composite panel products, now or hereafter standing and growing on the Property.

     “Purchaser” shall have the meaning provided in the first paragraph of this Agreement.

     “Purchaser Event of Default” has the meaning set forth in Section 9.1 hereof.

     “Purchaser Indemnitee” has the meaning set forth in Section 10.2 hereof.

     “Quarterly Delivery Variance” has the meaning set forth in Section 5.1(b) hereof.

     “Quarterly Price” means, for any calendar quarter after 2007, the Final Quarterly Price for
the immediately preceding calendar quarter adjusted by the average *** Adjustment Factor applicable to
the calendar quarter in question for the immediately preceding *** years.

     “Renewal Period” has the meaning set forth in Section 6.2 hereof.

     “Residual Biomass” means Biomass associated with stands harvested from the Property by Seller
in connection with the performance of its obligations under this Agreement.

     “SFI Standards” means standards for harvesting activities meeting the minimum requirements for
compliance with the standards of the Sustainable Forestry Initiative, 2005-2009, of the American
Forest and Paper Association and any successor thereto, as those standards may be modified from
time to time by the American Forest and Paper Association and any successor thereto.

     “Secondary Delivery Zone” with respect to any Delivery Point means all those tracts of
Property located more than *** road miles from such Delivery Point.

     “Seller” shall have the meaning provided in the first paragraph of this Agreement.

     “Seller Event of Default” has the meaning set forth in Section 9.2 hereof.

     “Seller Indemnitee” has the meaning set forth in Section 10.1 hereof.

     “Specifications” means the technical specifications for Product delivered to Purchaser in
accordance with this Agreement, as they exist from time to time pursuant to the terms of Section

6

 

3.1. The Specifications as of the Effective Date are more particularly set out in Schedule 1
hereto.

     “Substitute Products” shall have the meaning provided in Section 5.1(e).

     “Term” shall have the meaning provided in Section 6.1.

     “Termination Date” means the effective date of termination of this Agreement in accordance
with its terms by Purchaser or Seller at any time other than the expiration of the Term.

     ***

     “*** Adjustment Factor” means, for any calendar quarter, the percentage change in pricing for
the product type in question in the relevant geographic region between the end of the immediately
preceding calendar quarter and the end of the applicable calendar quarter, as such prices are
reported by ***.

     “Transfer” means any direct or indirect transfer, sale, assignment, pledge, hypothecation or
other disposition of ownership or control of the Property.

     “Uncommitted Volume” means any Product that Seller elects to harvest from the Property during
a Harvest Year in excess of the Annual Harvest Volume set forth in the Annual Plan for such Harvest
Year.

ARTICLE II

HARVEST VOLUMES

     Section 2.1 Obligation to Purchase and Sell. In accordance with the terms hereof, during the Term
Purchaser covenants and agrees to purchase and receive from Seller and Seller covenants and agrees
to sell, deliver and provide to Purchaser, in each Harvest Year, the Obligated Volume at the
Delivery Point(s) specified by Purchaser.

     Section 2.2 Annual Plan and Forecast Plan. On or before September 30 of each year during the Term,
Seller shall deliver to Purchaser an Annual Plan for the immediately following Harvest Year and a
Forecast Plan. The aggregate Annual Harvest Volume of Product set forth in an Annual Plan shall in
no event be less than the Annual Minimum Volume for the same Harvest Year. The annual volume set
forth in an Annual Plan (i) shall not vary by more than *** from the forecast volume for such
Harvest Year as set forth in the previous year’s Forecast Plan, and (ii) shall not vary by more
than *** from the forecast volume for such Harvest Year as set forth in the Forecast Plan delivered
to Purchaser two years earlier. The Annual Plan for Harvest Year 2008 and Forecast Plan for
Harvest Years 2009 and 2010 are attached hereto as Schedule 2 and Schedule 3, respectively.

     Section 2.3 Obligated Volume. On or before November 1 of each year during the Term, Purchaser
shall notify Seller in writing of the Obligated Volume which Purchaser elects to

7

 

purchase and
receive from Seller during the upcoming Harvest Year and Seller agrees to deliver such Obligated
Volume in accordance with the terms of this Agreement. The Obligated Volume shall equal the sum of
(i) the Obligation Floor plus (ii) such portion of the Annual Harvest Option Volume that Purchaser
elects to purchase during the upcoming Harvest Year. The Obligated Volume for Harvest Year 2007
shall be *** tons, and the Obligated Volume for Harvest Year 2008 shall be agreed upon by the
parties on or before November 15, 2007.

     Section 2.4 Uncommitted Volume and Quarterly Meetings. Purchaser and Seller shall meet quarterly
each Harvest Year, on or before March 1, June 1, September 1 and December 1, to discuss the
then-current Obligated Volume and any Uncommitted Volume. Purchaser shall have the right to
purchase at the applicable Quarterly Price any portion, not to exceed ***, of the Uncommitted
Volume. Seller shall make all of the Uncommitted Volume contained within the Primary Delivery Zone
available to fulfill any such portion purchased by Purchaser, and shall deliver such portion in
accordance with a delivery schedule that the parties shall mutually agree upon at the time of
Purchaser’s election. Seller shall not have the right to count any purchased Uncommitted Volume
towards the Obligated Volume. Purchaser and Seller shall compute the Final Quarterly Price for
such purchased Uncommitted Volume pursuant to, and shall remit any excess in accordance with,
Section 4.2.

     Section 2.5 Biomass. Purchaser shall have the right to offer, on or before November 1 of each
calendar year during the Term, to purchase, collect and retain any Residual Biomass by notifying
Seller in writing of the volume of Residual Biomass that Purchaser offers to purchase, collect and
retain, which notice shall include the price Purchaser will pay for such Biomass and, with
reasonable specificity, the location of such Biomass (a “Biomass Offer”). Seller shall have thirty
(30) days to accept or reject such Biomass Offer by written notice delivered to Purchaser. If
Seller fails to deliver such written notice within the thirty (30) day period, Seller shall be
deemed to have rejected the Biomass Offer. Seller shall have the right to sell such Residual
Biomass to any third party only upon the actual or deemed rejection of such Biomass Offer and under
no other circumstances. If Seller accepts a Biomass Offer, Purchaser and Seller shall enter into a
usual and customary agreement with respect to Purchaser’s entrance upon the Property and
Purchaser’s collection of Biomass from the Property. Notwithstanding anything in this Section 2.5
to the contrary, “Residual Biomass” shall exclude any Biomass that Seller is obligated to sell to a
third party under a contract with a term of at least one (1) year. Purchaser shall purchase,
collect and retain *** tons of Residual Biomass during Harvest Year 2007 and *** tons of Residual
Biomass in Harvest Year 2008 from the harvest locations as set forth in Schedule 9.

     Section 2.6 Post-Harvest Carbon Rights.
Prior to the severance of the Product from the Property, Seller shall have exclusive Carbon Rights
in the Property and in all standing, harvested or fallen trees or other vegetation on the Property.
To the extent Carbon Rights associated with severed wood products can be transferred under any
existing or future, mandatory or voluntary, carbon dioxide allocation, trading, taxation or other
emissions limitation regime, the sale of Product under this Agreement shall include as part of such
sale any and all Carbon Rights associated with the Product. Purchaser shall have no claim or right
to any Carbon Rights associated with the Property (whether fee or leasehold interest), or, prior to
the severance of Product from the Property, with standing, harvested or fallen trees or other
vegetation on the Property, but Seller shall not separate any transferable Carbon Rights from
Product sold to Purchaser prior to sale.

8

 

ARTICLE III

PRODUCT SPECIFICATIONS

     Section 3.1 Product Specifications. Any and all Product delivered shall meet the Specifications.
Purchaser may modify, amend, add to, alter, revise or change the Specifications at any time during
the Term by giving Seller not less than thirty (30) days advance written notice of any
modification, amendment, addition, alteration, revision or change to the Specifications, provided
that any such modification, amendment, addition, alteration, revision or change to the
Specifications does not materially and adversely impact Seller’s ability to comply with its
obligations hereunder; provided further that any such modification, amendment, addition,
alteration, revision or change to the Specifications shall be applicable to all suppliers of the
Mill, and provided further that Purchaser shall not modify the Specifications to set higher
standards for Seller than for any other suppliers of comparable product to the applicable Delivery
Points.

     Section 3.2 Rejected Product. Purchaser has the right to reject any or all Product not meeting the
Specifications applicable at the time of delivery; provided, however, at Seller’s request,
Purchaser shall (i) provide Seller with a written or photographic explanation for the basis of any
such rejection, and (ii) afford Seller the opportunity to inspect, within a reasonable period of
time, any such rejected Product. Product rejected for failure to meet Specifications shall not be
included in calculating whether Seller met its required Obligated Volume. EXCEPT FOR THE
SPECIFICATIONS SET FORTH IN THIS AGREEMENT, SELLER DISCLAIMS ALL WARRANTIES OF ANY KIND INCLUDING,
WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
In the event Purchaser rejects any or all Product not meeting the Specifications, Purchaser, at
Seller’s sole cost, risk and expense, may reload, or cause to be reloaded, the rejected Product
onto Seller’s vehicles or any other vehicles delivering Product to Purchaser. Seller shall remove
and dispose of any rejected Product at Seller’s sole cost, risk and expense. Notwithstanding the
foregoing, Purchaser shall have the option, at its sole election, to purchase any of such rejected
Product following any requested written or photographic explanation and inspection process as
described above, at a price mutually agreed to by Seller and Purchaser, in which event such Product
shall not be included in calculating whether Seller met its required Obligated Volume.

ARTICLE IV

PRICE SCHEDULE

     Section 4.1 Base Price. The Base Price as of the Effective Date of this Agreement is set forth in
Schedule 6 attached hereto. The resulting Quarterly Price in effect between the Effective Date and
December 31, 2007, shall be equal to the Base Price adjusted by the average *** Adjustment Factor
applicable to the fourth calendar quarter for the immediately preceding ***.

     Section 4.2 Quarterly Price. The price paid by Purchaser for Product delivered during any calendar
quarter during the Term shall be the Quarterly Price. Within twenty (20) days after the end of
every calendar quarter, Seller and Purchaser shall compute the Final Quarterly Price.

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If the Final
Quarterly Price is greater than the Quarterly Price paid for such calendar quarter, then Purchaser
shall remit to Seller the additional amount owed by Purchaser within fifteen (15) days after the
calculation. If the Final Quarterly Price is less than the Quarterly Price paid for such calendar
quarter, then Seller shall remit to Purchaser the amount of such overage, and if Seller fails to
remit such amount within fifteen (15) days after the calculation of such overage, Purchaser shall
have the right to offset the overage against amounts next due and owing to Seller under this
Agreement. An example of the pricing mechanism set forth herein is set forth on Schedule 7
attached hereto.

ARTICLE V

DELIVERY, FORCE MAJEURE AND PAYMENT

     Section 5.1 Delivery, Scaling and Weighing.

     (a) No later than each November 1 during the Term, Purchaser shall propose to Seller a target
quarterly delivery schedule with respect to the Obligated Volume for the upcoming Harvest Year.
The parties shall work together to jointly develop a mutually acceptable quarterly delivery
schedule for such Harvest Year (the “Delivery Plan”), which Delivery Plan shall be agreed upon no
later than December 1. The quarterly volumes set forth in the Delivery Plan will be based on
Purchaser’s targeted quarterly inventory volumes for the Mill but will fall within the percentage
ranges for Obligated Volume set forth below:

	 	 	 
	Calendar Quarter	 	Percentage of Obligated Volume
	1
	 	***
	2
	 	***
	3
	 	***
	4
	 	***

     (b) The parties recognize a mutual benefit to produce and accept Product as consistently as
possible with such Delivery Plan. Seller shall use commercially reasonable efforts to dispatch
deliveries on a relatively even flow basis within each calendar quarter of the Harvest Year. It is
understood and agreed that material deviations to the Delivery Plan may occur due to weather
conditions or other unforeseen events. In such event, quarterly deliveries may be less than the
Delivery Plan’s applicable quarterly volume by up to *** (the total percentage of such variance
being the “Quarterly Delivery Variance”).

     (c) In the event the Quarterly Delivery Variance during any quarter *** of the total volume
required to be delivered during such quarter under the applicable Delivery Plan, Purchaser may
purchase Products or substitutes therefor (in either case, “Substitute Products”)

10

 

from any third
party in sufficient volumes to equal the Quarterly Delivery Variance at current fair market prices
for the applicable Products. If Purchaser purchases such Substitute Products, Seller, in lieu of
the remedies set forth in Section 9.4, shall promptly pay Purchaser the difference between the
highest price paid by Purchaser for the corresponding volume of such Substituted Products and the
applicable Quarterly Price. If Seller fails or refuses to pay such amount to Purchaser within ten
(10) days after Purchaser’s request therefor, Purchaser shall have the right to offset such amount
against amounts next due and owing to Seller by Purchaser hereunder. The applicable Obligated
Volume shall be reduced by the volume of Substitute Products purchased by Purchaser.

     (d) In the event the quarterly deliveries exceed the Delivery Plan’s applicable quarterly
volume by more than ***, any such volume delivered by Seller in excess of such *** threshold shall
be sold at a price agreed upon by Purchaser and Seller at the time of such delivery, and, unless
agreed to by Purchaser in writing, such excess volume shall not be applied against the Obligated
Volume.

     (e) If there is a negative annual variance at the end of any Harvest Year, Purchaser shall
have the right either to deduct the amount of such negative variance from the applicable Obligated
Volume or to require Seller to deliver such variance from the Delivery Plan (the “Carryover
Volume”) in the first quarter of the following Harvest Year, at a price equal to the lower of: (i)
the lowest Final Quarterly Price for all quarters during the previous Harvest Year, or (ii) the
final Quarterly Price for the calendar quarter in which the Carryover Volume is delivered. Any
delivery in the following Harvest Year will first be counted towards meeting the Carryover Volume
requirement. Deliveries during the fourth quarter shall only be applied against the then current
Harvest Year’s delivery requirements. The parties shall work together in good faith to adjust
delivery schedules to accommodate temporary or unforeseen hardships for either party. Each party
shall notify the other party of any anticipated delays as soon as such delay is anticipated.

     (f) Unless otherwise agreed to in writing by Purchaser, any portion of the Annual Harvest
Volume harvested within the Primary Delivery Zone shall be delivered to the Mill or such other
Delivery Point designated by Purchaser in accordance herewith until the Obligated
Volume for such Harvest Year has been fully met. Prior to delivering Product to a Delivery
Point from the Secondary Delivery Zone with respect to a Delivery Point, Seller must obtain the
written consent of Purchaser, which consent may be withheld in Purchaser’s reasonable discretion,
unless such delivery was contemplated by the Delivery Plan for such Harvest Year. Any Product
delivered by Seller from within a Secondary Delivery Zone in accordance with the preceding sentence
shall be subject to a Freight Adjustment.

     (g) Purchaser may elect, in its sole discretion and upon seven (7) days’ prior written notice
to Seller, to redirect the delivery of all or a portion of the Product to be delivered by Seller
hereunder to another Delivery Point, provided that if the new Delivery Point is located more than
*** road miles from the harvested tract, such redirected portion of the Product shall be subject to
a Freight Adjustment. Subject to Purchaser’s prior written consent, exercisable in Purchaser’s
reasonable discretion, Seller may redirect the delivery of all or a portion of the Product to be
delivered by Seller hereunder to a Delivery Point other than the Delivery Point required under the
applicable Delivery Plan.

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     (h) All Product subject to this Agreement shall be delivered to Purchaser F.O.B. to the
designated Delivery Point during the regular business hours of such Delivery Point. Risk of loss
and title to the Product shall pass from Seller when the Product is unloaded and accepted by
Purchaser pursuant to the terms hereof. All Product delivered hereunder by Seller shall be scaled
or weighed by Purchaser, or its designee, upon delivery at the respective Delivery Point using
privately verified scales, which data shall be recorded by the scaler (or weigher) on scale or
weight tickets and a copy of each ticket shall be given to Seller or its designated representative.
Additional information reasonably required by the parties from time to time or by state law,
including but not limited to origin by tract location of delivered Product, shall also be included
on the scale ticket or provided in such other format as may be reasonably requested by Purchaser.
Seller shall (i) adhere to Purchaser’s requirements for delivery as are established from time to
time to conform with changes in law, forestry practices and Purchaser’s operational requirements,
provided such adjustments are comparable to industry standards and are similar to those required by
Purchaser of its other suppliers and (ii) comply with all applicable laws, rules and regulations.

     (i) If the volume of Product in the Primary Delivery Zone is sufficient to satisfy the
Obligated Volume, Purchaser may purchase a volume of Juvenile Wood such that the percentage of
Juvenile Wood contained in such Product is less than the Annual Juvenile Wood Percentage for such
Harvest Year; provided, however, Seller shall have the right to deliver, without any otherwise
applicable Freight Adjustment, such additional amount of Juvenile Wood from the Secondary Delivery
Zone as may be necessary to achieve the Annual Juvenile Wood Percentage. Under no circumstances
shall Purchaser be required to purchase Juvenile Wood during any Harvest Year in excess of the
amount equal to the product of (x) the Annual Juvenile Wood Percentage for such Harvest Year
multiplied by (y) the Obligated Volume. Any volume of Juvenile Wood in excess of the volume of
Juvenile Wood purchased by Purchaser pursuant to the first two (2) sentences of this Section 5.1(i)
may be acquired by Purchaser, at Purchaser’s sole election, at a price to be negotiated by
Purchaser and Seller, but shall not count against the Obligated Volume unless otherwise approved in
writing by Purchaser.

     Section 5.2 Force Majeure.
Subject to the provisions of this Section 5.2, neither party shall be liable hereunder, and
performance shall be excused, for a delay in or failure of performance of its obligations hereunder
caused by a Force Majeure event, provided, however, no excuse for performance due to a Force
Majeure delay under this Section 5.2 shall be effective unless the party experiencing such delay
shall have notified the other party of the delay within ten (10) days of the event giving rise to
such delay, unless the failure to provide this notice has not caused prejudice to the other party,
in which event excuse for performance shall be effective. To the extent performance has been
excused, neither party shall be required to make up performance which has been excused upon
termination or expiration of the Force Majeure event. The parties shall use commercially
reasonable efforts to mitigate the effects of the Force Majeure event, and if the cause of Force
Majeure can be minimized or remedied, the parties shall use reasonable best efforts to do so
promptly.

     (a) Notwithstanding anything herein to the contrary, if, as a result of a Force Majeure event
pursuant to which a delay in Seller’s performance is excused hereunder, or for any other reason
deliveries from Seller are reduced to the extent Purchaser cannot maintain its scheduled Products
inventory at the Mill, Purchaser shall, upon notice to Seller, have the right to

12

 

obtain Substitute
Products from sources other than Seller until such time as Seller is again able to commence the
delivery of Product to Purchaser. After Seller gives notice to Purchaser that it is again able to
commence delivery of Product pursuant to the terms of this Agreement, Purchaser shall notify Seller
of any commitments for Substitute Products that Purchaser has entered into. Purchaser shall not be
required to accept from Seller the amount by which the Products volume was reduced until such time
as Purchaser has accepted delivery of all Substitute Products contracted by Purchaser, provided
that no such contract for Substitute Products shall be for a term longer than one (1) month without
consent of Seller, which consent shall not be unreasonably withheld, conditioned or delayed.

     (b) Notwithstanding anything herein to the contrary, if, as a result of a Force Majeure event
pursuant to which Purchaser cannot accept the quantity of Products provided for herein, Purchaser
shall promptly so notify Seller, and Seller shall thereafter have the right to contract for the
sale of any such Products Purchaser is unable to accept. Upon notice from Purchaser to Seller that
Purchaser is again able to accept such Products, Seller will notify Purchaser of any commitments
for the sale of Products that Seller has entered into and Seller shall not be required to deliver,
or make available, as the case may be, such Products to Purchaser until Seller has provided all
Products contracted by Seller, provided that no such Agreement shall be entered into for a term
longer than one (1) month without the written consent of Purchaser, which consent shall not be
unreasonably withheld, conditioned or delayed. If a Force Majeure event prevents operation of the
Mill or any portion thereof, Purchaser will use its commercially reasonable efforts, within sixty
(60) days of such event or as soon thereafter as reasonably practicable, to notify Seller of
whether Purchaser intends to continue the operations of the Mill and the anticipated date such
operations will begin. In the event Purchaser has not reassigned some or all of the Products
applicable to the Mill to another Delivery Point in accordance herewith, then, within six (6)
months after the shutdown of the Mill or portion thereof, either Purchaser or Seller may terminate
this Agreement with respect to the portion of the Products that has not been reassigned upon thirty
(30) days written notice.

     Section 5.3 Change in Mill Operations.
Purchaser shall have the right to substantially curtail production at the Mill at Purchaser’s sole
discretion. In the event production at the Mill is, or Purchaser determines will be, reduced by
more than *** for more than thirty (30) days, as measured against normal and customary operations,
upon ninety (90) days’ prior notice to Seller of such curtailment of production, the Obligated
Volume and the Obligation Floor shall be appropriately reduced until such curtailment expires, and
Seller may sell to other purchasers an amount of Product equal to the reduced portion of Obligated
Volume.

     Section 5.4 Payment. Purchaser shall pay Seller within fifteen (15) days after the date of
delivery of Product to the designated Delivery Point.

ARTICLE VI

TERM

     Section 6.1 Term. Unless this Agreement is earlier terminated pursuant to Section 6.3 or Article
IX hereof, this Agreement shall commence on the Effective Date and shall expire at midnight on the
date which is twenty (20) years after the Effective Date (said period, as the same may be extended
pursuant to Section 6.2 below, the “Term”).

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     Section 6.2 Extension of Term. Provided that no Purchaser Event of Default exists at the time
Purchaser elects to extend the Term pursuant to this Section 6.2, Purchaser shall have one (1)
option (the “Option”) to extend the Term of this Agreement for a period of *** years (the “Initial
Option Period”). Purchaser may exercise the Option to extend the Term, in its sole discretion, by
giving written notice to Seller of its election to extend the Term at least *** prior to the
then-current expiration date of the Term. Upon the expiration of the Initial Option Period and
upon the expiration of each successive *** period thereafter (each such successive *** period a
“Renewal Period”), unless either party gives written notice to the other party, at least *** prior
to the expiration of the Initial Option Period or the Renewal Period, as the case may be, of its
election not to renew this Agreement, this Agreement shall renew automatically for an additional
Renewal Period.

     Section 6.3 Termination. In addition to Purchaser’s other rights to terminate this Agreement set
forth herein, Purchaser may, in its sole discretion, terminate this Agreement upon the occurrence
of a Change Event by giving not less than *** prior written notice of its election to terminate
this Agreement.

     Section 6.4 Effect of Termination. Upon the earlier of the expiration of the Term or the
termination of this Agreement pursuant to Article IX, this Agreement will become null and void and
have no further force and effect; provided, however, that the provisions of Articles IX and X
hereof shall survive the expiration or termination of this Agreement and remain in full force and
effect; provided, further that no
termination or expiration of this Agreement shall relieve either party of any obligation accrued
prior to the effective date of expiration or termination, or of any liability for any breach of
this Agreement by such party prior to the date of such termination.

ARTICLE VII

REPRESENTATIONS AND WARRANTIES

     Section 7.1 Representations and Warranties of Purchaser. Purchaser represents and warrants to
Seller that the statements contained in this Section 7.1 are correct and complete as of the
Effective Date.

     (a) Purchaser is a corporation duly incorporated, validly existing and in good standing under
the laws of the State of Delaware. Purchaser has all necessary corporate power and authority to
(i) conduct its business as it is presently being conducted, (ii) execute this Agreement and (iii)
perform its obligations and consummate the transactions contemplated hereby. Purchaser is duly
qualified to do business in the States of Texas and Louisiana and the failure to be qualified to do
business in any other jurisdiction would not, individually or in the aggregate, have a material
adverse effect on the financial condition or results of operations of Purchaser or Purchaser’s
ability to perform its obligations under this Agreement.

     (b) All corporate and other actions or proceedings to be taken by or on the part of Purchaser
to authorize and permit the execution and delivery by Purchaser of this Agreement, the performance
by Purchaser of its obligations hereunder and to consummate the transactions contemplated hereby
have been duly and properly taken. This Agreement has been duly

14

 

executed and delivered by
Purchaser. Upon execution by Purchaser of this Agreement, assuming the valid authorization,
execution and delivery by Seller of this Agreement, this Agreement shall constitute a legal, valid
and binding obligation of Purchaser that is enforceable against Purchaser in accordance with its
terms.

     (c) The execution and delivery by Purchaser of this Agreement and the consummation by
Purchaser of the transactions contemplated hereby will not result in a breach or violation of, or
default under: (i) any judgment, order, injunction, decree or ruling of any governmental authority
applicable to Purchaser or any of its assets; (ii) to Purchaser’s knowledge (as defined below), any
applicable statute, law, ordinance, rule or regulation; (iii) the terms, conditions or provisions
of Purchaser’s certificate of incorporation, bylaws or any standing resolution of its Board of
Directors; or (iv) any note or other evidence of indebtedness, mortgage, deed of trust, indenture,
or other agreement or instrument to which Purchaser is a party or by which Purchaser may be bound,
except for any such breach, violation or default that would not materially adversely affect the
ability of Purchaser to perform its obligations hereunder.

     (d) There are no approvals, consents, permits or registration requirements with respect to any
applicable governmental authority or any other Person that are or will be necessary for the valid
execution and delivery by the Purchaser of this Agreement or the performance of its obligations
hereunder.

     As used in this Section 7.1, the term “Purchaser’s knowledge” means the actual knowledge,
without inquiry, of Morris Davis or George Vorpahl.

     Section 7.2 Representations and Warranties of Seller. Seller represents and warrants to Purchaser
that the statements contained in this Section 7.2 are correct and complete as of the Effective
Date.

     (a) Seller is a limited liability company duly formed, validly existing and in good standing
under the laws of the State of Delaware. Seller has all necessary power and authority to (i)
conduct its business as it is presently being conducted, (ii) execute this Agreement and (iii)
perform its obligations and consummate the transactions contemplated hereby. Seller is duly
qualified to do business in the States of Texas and Louisiana, and the failure to be qualified to
do business in any other jurisdiction would not, individually or in the aggregate, have a material
adverse effect on the financial condition or results of operations of Seller.

     (b) All actions or proceedings to be taken by or on the part of Seller to authorize and permit
the execution and delivery by Seller of this Agreement, the performance by Seller of its
obligations hereunder and to consummate the transactions contemplated hereby have been duly and
properly taken. This Agreement has been duly executed and delivered by Seller. Upon execution by
Seller of this Agreement, assuming the valid authorization, execution and delivery by Purchaser of
this Agreement, this Agreement shall constitute a legal, valid and binding obligation of Seller
that is enforceable against Seller in accordance with its terms.

     (c) The execution and delivery by Seller of this Agreement and the consummation by Seller of
the transactions contemplated hereby will not result in a breach or violation of, or default under:
(i) any judgment, order, injunction, decree, or ruling of any court

15

 

or governmental authority
applicable to Seller or any of its assets; (ii) to Seller’s knowledge (as defined below), any
statute, law, ordinance, rule or regulation; (iii) the terms, conditions, or provisions of Seller’s
bylaws, charter, or other documents of governance; or (iv) any note or other evidence of
indebtedness, any mortgage, deed of trust or indenture, or any lease or other agreement or
instrument to which Seller is a party or by which Seller may be bound, except for any such breach,
violation or default that would not materially adversely affect the validity or enforceability of
this Agreement or the ability of Seller to perform its obligation hereunder.

     (d) There are no approvals, consents, permits or registration requirements with respect to any
applicable governmental authority or any other Person that are or will be necessary for the valid
execution and delivery by the Seller of this Agreement or the performance of its obligations
hereunder.

     (e) Seller has good and marketable title to the Products free and clear of all Liens, except
for such Liens that would not otherwise materially adversely affect Purchaser’s rights in and to
the Products delivered, or made available, to Purchaser pursuant to this Agreement. Seller shall
pay, or cause to be paid, all severance taxes or other levies upon or incident to the production
and delivery of Products hereunder which will or may constitute a Lien thereon or on any products
manufactured therefrom.

     As used in this Section 7.2, the term “Seller’s knowledge” means the actual knowledge, without
inquiry, of Jerry Brodie.

ARTICLE VIII

SELLER’S MANAGEMENT

     Section 8.1 Seller’s Management. Except as expressly provided otherwise in Section 2.5, Seller
will be responsible for the designation, layout and timing of harvest areas, logging and
transportation to the designated Delivery Point, and all other activities associated with ownership
of the Property. Seller agrees to manage the Property in accordance in all material respects with
applicable state best management practices for forestry and in a manner that meets the minimum
requirements for compliance with SFI Standards, including providing third party certification of
same, or such other third party certification program as is approved in writing from time to time
by Purchaser. Seller’s contracts with logging professionals that produce and deliver Product under
this Agreement shall require that they (i) maintain logger training and continuing education
requirements in accordance with Sustainable Forestry Initiative State Implementation Committee
standards, or such other third party certification organization standards approved in writing by
Purchaser, and (ii) comply with applicable state best management practices for forestry and all
applicable laws, including, without limitation, any weight restriction laws, ordinances or
regulations, and Seller shall use diligent, good faith efforts to ensure compliance with such
requirements. Following written request by Purchaser, Seller shall collect and provide Purchaser
with tract identification information for all Product delivered in accordance herewith. Seller
shall keep evidence of compliance with the terms of this Section 8.1 during the Term, which should
include copies of education certificates and any other appropriate evidence of compliance. Seller
will act in good faith and use its commercially reasonable efforts to cause all Products to meet
the applicable Specifications.

16

 

ARTICLE IX

DEFAULT AND DISPUTE RESOLUTION

     Section 9.1 Default by Purchaser. The following events shall constitute events of default by the
Purchaser (each a “Purchaser Event of Default”):

     (a) Purchaser fails to pay as and when due any amount payable by it under this Agreement, and
any such failure remains uncured fifteen (15) days after written notice thereof has been delivered
to Purchaser;

     (b) Purchaser fails to perform or observe any other term, covenant or agreement contained in
this Agreement on its part to be performed or observed, and any such failure
remains uncured for thirty (30) days after written notice thereof has been delivered to
Purchaser; or

     (c) Any representation or warranty of Purchaser under this Agreement is incorrect in any
material respect.

If any Purchaser Event of Default occurs and continues fifteen (15) days after such initial written
notice thereof has been given to Purchaser, then Seller may, by written notice to Purchaser, in
addition to Seller’s other remedies available herein in equity, at law, or otherwise, suspend
delivery of Product otherwise deliverable to Purchaser pursuant to the terms of this Agreement, and
deliver such Product to an alternate third-party purchaser at a price reasonably consistent with
then-existing market conditions (such Product counting toward the applicable Obligated Volume);
provided that Purchaser shall be liable in the event of such delivery to an alternate purchaser for
the difference between the applicable Quarterly Price for such Product and the price actually paid
to Seller by such alternate third-party purchaser for such Product. If any Purchaser Event of
Default occurs and continues fifteen (15) days after a second written notice thereof has been given
to Purchaser upon or after expiration of the initial 15-day cure period, then Seller may, by
written notice to Purchaser, in addition to Seller’s other remedies available herein, in equity, at
law, or otherwise, (i) terminate this Agreement, or (ii) pursue specific performance of this
Agreement.

     Section 9.2 Default by Seller. The following events shall constitute events of default by the
Seller (each a “Seller Event of Default”):

     (a) Seller fails to pay as and when due any amount payable by it under this Agreement, and any
such failure remains uncured fifteen (15) days after written notice thereof has been delivered to
Seller;

     (b) Seller fails to perform or observe any other term, covenant or agreement contained in this
Agreement on its part to be performed or observed, and any such failure remains uncured thirty (30)
days after written notice thereof has been delivered to Seller;

     (c) Any representation or warranty of Seller under this Agreement is incorrect in any material
respect;

17

 

     (d) Seller fails to deliver in any calendar quarter, at least ninety percent (90%) of the
applicable quarterly volume in the Delivery Plan; or

     (e) Seller fails to deliver at least ninety percent (90%) of the Obligated Volume in any
Harvest Year.

If any Seller Event of Default occurs and continues fifteen (15) days after such initial written
notice thereof has been given to Seller, then Purchaser may, by written notice to Seller, in
addition to Purchaser’s other remedies available herein in equity, at law, or otherwise, suspend
acceptance of Product otherwise deliverable to Purchaser pursuant to the terms of this Agreement,
and accept such Product from an alternate third-party supplier at a price reasonably
consistent with then-existing market conditions (such Product counting toward the applicable
Obligated Volume); provided that Seller shall be liable in the event of such acceptance from an
alternate supplier for the difference between the applicable Quarterly Price for such Product and
the price actually paid by Purchaser to such alternate third-party supplier for such Product. If
any Seller Event of Default occurs and continues fifteen (15) days after a second written notice
thereof has been given to Seller upon or after expiration of the initial 15-day cure period, then
Purchaser may, by written notice to Seller, in addition to Purchaser’s other remedies available
herein, in equity, at law, or otherwise, (i) terminate this Agreement, or (ii) pursue specific
performance of this Agreement.

     Section 9.3 Specific Performance. With respect to Purchaser’s and Seller’s rights to seek specific
performance pursuant to Sections 9.1 and 9.2, each party acknowledges and agrees that the other
party would be damaged irreparably in the event any of the provisions of this Agreement are not
performed in accordance with their specific terms or otherwise are breached. Accordingly, each of
the parties agrees that the other party shall be entitled to an injunction or injunctions to
prevent breaches of the terms of this Agreement and to enforce specifically this Agreement and the
terms and provisions hereof in any action instituted in any court of the United States or any state
thereof having jurisdiction over the parties and the matter, in addition to any other remedy to
which they may be entitled hereunder.

     Section 9.4 Liquidated Damages. Without limiting the rights and remedies set forth in Section 9.2
and Section 9.3, in the event of a Seller Event of Default due to Seller’s failure or inability,
for any reason other than Force Majeure, to timely deliver the volumes of Product as required under
this Agreement, then Purchaser may elect, in addition to any other rights Purchaser may have under
Section 9.2 and Section 9.3, to require Seller to pay to Purchaser, as liquidated damages and not
as a penalty, an amount equal to the difference between any cover price paid by Purchaser and the
unpaid price under this Agreement plus *** of such amount. If Seller fails or refuses to pay such
amount to Purchaser within ten (10) days after Purchaser’s request therefor, Purchaser shall have
the right to offset such amount against amounts next due and owing to Seller by Purchaser
hereunder. In the event of a Seller Event of Default, each party hereby waives the right to
recover incidental, consequential or punitive damages from the other party hereto.

     Section 9.5 Assignment of Agreement. In the event of a Seller Event of Default that remains
uncured fifteen (15) days after the second written notice given pursuant to Section 9.2, Seller
shall, not later than five (5) days after receiving a written request from Purchaser, assign to

18

 

Purchaser all of Seller’s rights, interests and obligations in and under the Master Stumpage
Agreement and Purchaser shall assume the obligations of Seller thereunder from and after the date
of such assignment, provided, however, that Seller shall remain responsible (and Purchaser shall
not be responsible) for any obligations of Seller thereunder arising prior to such assignment.
Notwithstanding the foregoing, Purchaser may, at Purchaser’s option, elect to pay any outstanding
invoices payable by Seller under the Master Stumpage Agreement, in which event Purchaser shall have
recourse against Seller for any amounts so paid, including, without
limitation, the right to offset any such amounts against amounts payable by Purchaser to
Seller hereunder.

     Section 9.6 Dispute Resolution.

     (a) In the event of any dispute, claim, question or disagreement arising from or relating to
this Agreement or the breach thereof, each party shall use its commercially reasonable efforts to
settle the dispute, claim, question or disagreement. To this effect, upon written notice from
either party to the other party requesting that discussions be initiated (a “Dispute Notice”),
Purchaser and Seller shall consult and negotiate with each other in good faith and, recognizing
their mutual interests, attempt to reach a just and equitable solution satisfactory to the parties.
If Purchaser and Seller do not reach such a solution within a period of fifteen (15) days after
delivery of such Dispute Notice, the parties shall have all rights and remedies set forth in this
Agreement or otherwise available under applicable law. If the parties mutually agree to arbitrate
a dispute, then the applicable dispute, claim or controversy shall be submitted to resolution in
the following manner:

     (i) Arbitration shall be according to the rules of the AAA (but not administered by
AAA), except as herein modified by the parties or otherwise as agreed to by the parties.

     (ii) Within ten (10) days of the agreement of the parties to arbitrate, each party will
select an arbitrator, notify the other party of its selection and submit to the other party
and its selected arbitrator its position regarding such claim, dispute or controversy.
Within ten (10) days after such notice, the respective arbitrators will select a third
arbitrator as the chairman of the panel (the “Panel Chairman”). The arbitrators selected by
Purchaser and Seller, together with the Panel Chairman, shall be, collectively, referred to
herein as the “Panel.”

     (iii) All arbitrators on the Panel shall have experience in the business of producing,
procuring and selling forest products in the Southern region of the United States.
Furthermore, the Panel Chairman shall be a forestry professional with at least ten (10)
years of experience in Southern timber harvesting practices who has not performed any work
as an employee or consultant for either party during the previous five (5) years, unless
otherwise agreed upon by Purchaser and Seller.

     (iv) A majority decision of the Panel and resolution must be reached within fifteen
(15) days after the selection of the Panel Chairman. Decisions of the panel must be in
writing and will be final and binding upon the parties, and judgment may be entered thereon
by any court having jurisdiction.

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     (b) Notwithstanding anything to the contrary contained in Section 9.6(a), above, Seller and
Purchaser agree to submit any dispute as to Base Price, Quarterly Price, Final Quarterly Price,
Freight Adjustment or any other dispute with respect to price (a “Price Dispute”) to binding
arbitration to be resolved by a Panel selected in accordance with the provisions of Section
9.6(a)(ii) above, which Panel shall act in accordance with the following procedure:

	 	(i)	 	Within fifteen (15) days after the selection of the Panel, each
party will submit in writing to the Panel its position with respect to the
price or cost in dispute and any materials such party wishes to submit
supporting the use of the proposed purchase and sale price.
	 
	 	(ii)	 	Within fifteen (15) days following the submission of the
position of each party, the Panel will choose one of the two submitted
positions (and no other) based upon the Panel’s determination of the position
that better reflects the actual market price or cost at issue. If only one
position is submitted, the Panel will choose such position.
	 
	 	(iii)	 	The Panel shall assess the costs of such arbitration and
reasonable attorney fees against the party whose position was not chosen or who
did not submit a position.

During the arbitration proceedings of any Price Dispute, the Price for the purchase and sale of
such Product for the calendar quarter in question shall be the average of the two submitted prices
and Seller shall continue to deliver Product and Purchaser shall continue to accept Product as
otherwise required by this Agreement. Upon the resolution of such Price Dispute, Purchaser and
Seller agree to adjust the Price for any Product sold by Seller and purchased by Purchaser during
such arbitration proceeding to reflect the Price as determined by the Panel and promptly reimburse
each other accordingly to effect such adjustment.

     (c) Except as provided in Section 9.6(b), above, each party shall bear its own cost of
presenting its case, and one-half of the cost incurred by the Panel.

     (d) The parties and the Panel shall treat the proceedings, any resolution thereof and any
related discovery as confidential, except in connection with a judicial challenge to, or
enforcement of, an award and unless otherwise required by law.

ARTICLE X

INDEMNITY AND INSURANCE

     Section 10.1 Purchaser’s Indemnity. Purchaser shall defend, indemnify and hold harmless the
Seller, its Affiliates and their assignees, subcontractors, members, shareholders, directors,
officers, managers, partners, employees, agents and consultants (each, a “Seller Indemnitee”), from
and against all claims and causes of action, pending or threatened, of any kind or nature, by third
parties, related to or arising out of any bodily injury to, or death of, any Person, or any
physical damage to tangible property, resulting from, or attributable to,

20

 

Purchaser’s breach of
this Agreement or the negligent or intentional wrongful acts or omissions of Purchaser, its
Affiliates or any of their employees, agents or contractors; except to the extent such injury or
damage also results in part from the negligent or intentionally wrongful act or omission of any
Seller Indemnitee. Notwithstanding anything herein to the contrary, Purchaser shall indemnify any
Seller Indemnitee for any incidental, consequential or punitive damages that such Seller Indemnitee
is required to pay to any third
party as a result of such breach, act or omission of Purchaser, its Affiliates or any of their
employees, agents or contractors.

     Section 10.2 Seller’s Indemnity. Seller shall defend, indemnify and hold harmless the Purchaser,
its Affiliates and their assignees, subcontractors, members, shareholders, directors, officers,
managers, partners, employees, agents and consultants (each, a “Purchaser Indemnitee”), from and
against all claims and causes of action, pending or threatened, of any kind or nature, by third
parties, related to or arising out of any bodily injury to, or death of, any Person, or any
physical damage to tangible property, resulting from, or attributable to, Seller’s breach of this
Agreement or the negligent or intentional wrongful acts or omissions of Seller, its Affiliates or
any of their employees, agents or contractors; except to the extent such injury or damage also
results in part from the negligent or intentionally wrongful act or omission of any Purchaser
Indemnitee. Notwithstanding anything herein to the contrary, Seller shall indemnify any Purchaser
Indemnitee for any incidental, consequential or punitive damages that such Purchaser Indemnitee is
required to pay to any third party as a result of such breach, act or omission of Seller, its
Affiliates or any of their employees, agents or contractors.

     Section 10.3 Insurance. Each party, and any contractors engaged by or on behalf of such party,
will keep in effect during the Term, at its sole expense, the following insurance coverages:

     (a) Comprehensive general liability insurance with limits not less than $2,000,000 for bodily
injury to one person, $2,000,000 for bodily injury to any group of persons as a result of one
occurrence, and $2,000,000 for property damage; provided, however each party’s contractors’
policies shall provide coverage for general liability with limits not less than $1,000,000 per
occurrence bodily injury liability and property damage liability combined and $1,000,000 in the
aggregate;

     (b) Commercial Auto Liability insurance with limits not less than $1,000,000 combined single
limits insuring “Any Auto” or “All Owned Autos,” “Hired Autos” and “Non-owned Autos;”

     (c) Employer’s Liability Insurance with limits not less than the following:

	 	(i)	 	Each accident — $100,000,
	 
	 	(ii)	 	Disease (policy) — $500,000, and
	 
	 	(iii)	 	Disease (each employee) — $100,000; and

     (d) Worker’s compensation insurance, covering all employees, including owners, partners and
executive officers, with limits no less than the statutory limits of the state where the work is
being performed. Each party’s worker’s compensation policy shall be endorsed to waive

21

 

all rights
of subrogation against the other party and all subsidiaries thereof where permitted by
law, and policies shall include excess and stop-gap worker’s compensation coverage for all
contractors and subcontractors of the insured party.

     Such policies will name the other party as an additional insured by endorsements to the
policies, as if the additional insureds were the named insured, without restrictions. Each party
shall provide the other party with Certificates of Insurance throughout the term of this Agreement,
as requested.

     Notwithstanding the provisions of Article IX, Purchaser shall have the right to withhold any
and all payments for Products or services provided hereunder if Seller does not procure insurance
coverage, allows coverage required hereunder to lapse or be cancelled, or does not provide evidence
of required insurance in accordance herewith.

     Either party may, at such party’s option and upon no less than ninety (90) days advance
written notice to the other party, amend the coverages and policy limits set forth in this Section
10.3 without the consent of the other party, provided that such new coverages and policy limits
shall be substantially similar to the coverage requirements imposed generally in the commercial
forestry industry in the Southern region of the United States.

     Section 10.4 Notice of Claim. Purchaser and Seller shall immediately give the other party written
notice of any alleged claim by a third party arising out of this Agreement or the actions or
activities contemplated by this Agreement.

ARTICLE XI

ASSIGNMENT AND TRANSFERS

     Section 11.1 Seller’s Assignment Rights. Any proposed assignment by Seller of its rights and
obligations under this Agreement that is subject to Sections 3.3(b) and 3.3(c) of the Support
Agreement shall be governed by such provisions. Otherwise, Seller may assign its rights and
obligations under this Agreement only to an assignee with the financial and operational capability
to fulfill the obligations of Seller hereunder and otherwise satisfactory to Purchaser as
determined in its reasonable discretion.

     Section 11.2 Purchaser’s Assignment Rights. Purchaser shall have the right to assign its
rights and obligations under this Agreement, in whole or in part, without the prior consent of
Seller.

ARTICLE XII

AUDIT RIGHTS

     Section 12.1 Audit Rights. Either party shall have the right to audit the other party’s compliance
with the terms of this Agreement, including the terms of Articles 2, 3, 4 and 5 by notifying the
party to be audited of
the requesting party’s exercise of such right within six (6) months after the end of the Harvest
Year for which the requesting party intends to exercise such right. The audited party shall
provide the requesting party or its representative with access

22

 

during normal business hours to all
records and other information necessary to complete such audit as are commercially reasonable.
Furthermore, the requesting party shall have the right to access the Property or the Mill, as the
case may be, and to inspect any and all deliveries of Product for purposes of monitoring the
performance of the audited party’s obligations pursuant to the terms herein, including the right to
audit. All nonpublic information acquired in the course of either party’s exercise of the audit
rights provided for by this Section 12.1 shall be subject to the provisions of Section 14.4.

ARTICLE XIII

NOTICES

     Section 13.1 Notices. All notices required or permitted to be given hereunder shall be in writing,
signed by the party giving such notice or its legal counsel, and shall be deemed to be delivered,
whether or not actually received, (i) when personally delivered by commercial courier service or
other messenger; (ii) three (3) days after being deposited with the United States Postal Service
with postage paid for certified delivery with return receipt requested; (iii) when sent by next day
business commercial service delivery, or (iv) when transmitted by e-mail evidenced by a
confirmatory response e-mail or by facsimile evidenced by a confirmed receipt, with a copy sent by
any of the means permitted by clauses (i), (ii) or (iii) above on the same day the e-mail or
facsimile transmission is sent by the party giving such notice. For purposes of notice, the
addresses of the parties are as follows:

	 	 	 	 	 
	 

	 	Purchaser:
	 	TIN Inc.
	 

	 	 	 	303 South Temple Drive
	 

	 	 	 	Diboll, Texas 75941
	 

	 	 	 	Attention: Group Vice President

                  Building Products
	 

	 	 	 	Facsimile: (936) 829-1248
	 

	 	 	 	E-mail: JackSweeny@templeinland.com
	 
	 	 	 	 
	 

	 	Copy to:
	 	Temple-Inland Inc.
	 

	 	 	 	1300 S. Mopac Expressway
	 

	 	 	 	Austin, Texas 78746
	 

	 	 	 	Attention: General Counsel
	 

	 	 	 	Facsimile: (512) 434-8051
	 

	 	 	 	E-mail: GeorgeVorpahl@templeinland.com
	 
	 	 	 	 
	 

	 	Seller:
	 	CPT LogCo, LLC
	 

	 	 	 	c/o The Campbell Group
	 

	 	 	 	1 SW Columbia, Suite 1700
	 

	 	 	 	Portland, Oregon 97258
	 

	 	 	 	Attention: Jerry Brodie
	 

	 	 	 	Facsimile: (503) 275-9667
	 

	 	 	 	E-mail: JBrodie@campbellgroup.com

23

 

	 	 	 	 	 
	 

	 	Copy to:
	 	Schwabe, Williamson & Wyatt
	 

	 	 	 	1211 SW Fifth Avenue, Suite 1800
	 

	 	 	 	Portland, Oregon 97204
	 

	 	 	 	Attention: Kirk Johansen
	 

	 	 	 	Facsimile: (503) 796-2900
	 

	 	 	 	E-mail: kjohansen@schwabe.com

or to such other address or addresses as any party may from time to time, upon five (5) business
days’ advance written notice to the other party, designate as to itself.

ARTICLE XIV

MISCELLANEOUS

     Section 14.1 Amendments. No amendment or waiver of any provision of this Agreement will in any
event be effective unless the same shall be in writing and signed by both parties. This Agreement
constitutes the full and complete understanding of the parties with respect to the subject matter
hereof and supersedes all prior and contemporaneous agreements and understandings, both oral and
written, between the parties with respect thereto.

     Section 14.2 Recording of Agreement. Seller and Purchaser shall cause to be recorded a Memorandum
of Agreement against the Property at the appropriate public records office(s) in the
jurisdiction(s) in which the Property is located giving notice of the rights of Purchaser under
this Agreement. Purchaser agrees to execute and deliver, within thirty (30) days following
Seller’s request therefor, appropriate recordable documents reasonably necessary to evidence the
release of any portion of the Property that is conveyed or otherwise transferred by Seller pursuant
to the terms of this Agreement, and Purchaser consents to the recording of such documents in the
appropriate public records office.

     Section 14.3 Compliance with Laws. Each party agrees that its performance of this Agreement shall
comply with all applicable federal, state and local laws, rules and regulations, including, without
limitation, all
Environmental Laws, and that each party shall obtain and maintain in effect all necessary licenses
and permits incident to its operations in the performance of this Agreement.

     Section 14.4 Confidentiality. To the fullest extent permitted under applicable law, the parties
hereto shall keep the nonpublic terms, conditions and provisions of this Agreement confidential;
provided, however, the parties may release information as required by applicable law, and to their
respective lenders, partners, employees, consultants and contractors so long as any such party is
made aware of the provisions of this Section 14.4.

     Section 14.5 Estoppel Certificates. Both parties agree that within twenty (20) days of the other
party’s request for the same, the providing party shall deliver to the requesting party an estoppel
certificate in form reasonably satisfactory to the requesting party setting forth (to the extent
the providing party may truthfully certify to the same), among other things, that this Agreement is
in full force and effect, that, to its knowledge, no breach exists on behalf of the

24

 

requesting
party hereunder, and the portion of the Obligated Volume harvested by Purchaser as of such date.

     Section 14.6 No Waiver; Remedies. No failure on the part of either party to exercise, and no delay
in exercising, any right under this Agreement will operate as a waiver thereof; nor will any single
or partial exercise of any right under this Agreement preclude any other or further exercise
thereof or the exercise of any other right.

     Section 14.7 Accounting Terms. All accounting terms not specifically defined herein will be
construed in accordance with United States generally accepted accounting principles consistently
applied, except as otherwise stated herein.

     Section 14.8 Binding Effect; Governing Law. This Agreement will be binding upon and inure to the
benefit of Purchaser and Seller and their respective successors and permitted assigns. This
Agreement will be governed by, and construed in accordance with, the laws of the State of Texas,
without giving effect to the conflicts of law principles thereof.

     Section 14.9 Counterparts. This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any of the parties may
execute this Agreement by signing any such counterpart.

     Section 14.10 Time of the Essence.
Time is of the essence of this Agreement.

     Section 14.11 Incorporation of Exhibits and Schedules. All exhibits and schedules referred to in
this Agreement are hereby incorporated herein by this reference.

     Section 14.12 Interest. At the election of the payee, any amount not paid when due hereunder, and
which remains unpaid for a period of fifteen (15) days or more after written notice of such
non-payment to the Person obligated to make such payment, will bear interest at the rate of five
percent (5%) above the prime rate, as published in the “Money Rates” table of the Wall Street
Journal from time to time, whichever is greater, from the date due until paid; provided, that in no
event shall the interest rate exceed the maximum lawful rate allowed under applicable law.

     Section 14.13 Further Assurances. Seller and Purchaser further covenant to cooperate with one
another in all reasonable respects necessary to consummate and give effect to the transactions
contemplated by this Agreement (including executing and delivering such instruments or other
writings as the other party may reasonably request), and each will take all reasonable actions
within its authority to secure cooperation of any necessary third parties.

     Section 14.14 Most Favored Status. During the Term, each party to this Agreement shall treat the
other on the most favorable basis compared to its other suppliers or purchasers with respect to its
sales, purchases and deliveries hereunder or any other matters in the customary operation of its
business. Without limiting the generality of the foregoing sentence, during the occurrence of
adverse weather conditions or an adverse change in the market that do not amount to a Force Majeure
event, (a) Purchaser shall not, to the extent commercially practicable, reduce the volume of
Product required to be purchased under this Agreement until such time as Purchaser has ceased
acceptance of delivery of similar wood products purchased from other

25

 

suppliers that are not
Affiliates of Seller and (b) Seller shall, to the extent commercially practicable, deliver all
Product harvested from the Property to Purchaser, and to no other Person, until such time as the
volume requirements for the applicable Delivery Plan have been met.

     Section 14.15 Attorney’s Fees. Except as expressly provided otherwise in Section 9.6, if
arbitration, mediation, litigation or any other proceeding of any nature whatsoever (including any
proceeding under the U.S. Bankruptcy Code) is instituted or appealed in connection with any
controversy arising out of this Agreement or to interpret or enforce any rights, the prevailing
party shall be entitled to recover its attorneys’, paralegals’, accountants’, and other experts’
fees and all other fees, costs, and expenses actually incurred, as determined to be reasonable by
the arbitrator(s) or court(s), in addition to all other amounts provided by law. The prevailing
party will be deemed to be the party to have won on the issues with the greatest value as
determined by the court(s) or arbitrator(s).

     Section 14.16 Severability. Whenever possible, each provision in this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provisions or the remaining provisions of this Agreement.

     Section 14.17 Captions and Headings. The captions and headings used in this Agreement are for
convenience and reference only and do not constitute a part of this Agreement and shall not be
deemed to limit, characterize or in any way affect any provision of this Agreement, and all
provisions of this Agreement shall be enforced and construed as if no caption or heading had been
used in this Agreement.

     Section 14.18 Construction. The parties agree that “including” and other words or phrases of
inclusion, if any, shall not be construed as terms of limitation, so that references to “included”
matters shall be regarded as nonexclusive, non-characterizing illustrations and equivalent to the
terms “including, but not limited to,” and “including, without limitation.” Each party
acknowledges that it has had the opportunity to be advised and represented by counsel in the
negotiation, execution and delivery of this Agreement and accordingly agrees that if any ambiguity
exists with respect to any provision of this Agreement, such provision shall not be construed
against any party solely because such party or its representatives were the drafters of any such
provision.

     Section 14.19 Relationship. The only relationship between Seller and Purchaser shall be that of
vendor and purchaser of the Product to be cut and removed from the Property, and neither party
shall in any respect be deemed to be or represent itself to be an agent of the other party.
Furthermore, no relationship of employer-employee or master and servant is intended, nor shall it
be construed, to exist between the parties, or between any party and any servant, agent, employee
and/or supplier of any other party, by reason of this Agreement. Each party shall select and pay
its own servants, agents, employees and/or suppliers and neither party nor its servants, agents,
employees, or suppliers shall be subject to any orders, supervision or control of the other party.

26

 

     Section 14.20 Integration. This Agreement constitutes the entire agreement of the parties
hereto with respect to the subject matter contained herein.

     Section 14.21 Uniform Commercial Code. This Agreement is subject to Section 1.304 of the
Business and Commerce Code of Texas.

[Signature Pages Follow]

27

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed, sealed and
delivered by their respective officers thereunto duly authorized, as of the date first above
written.

	 	 	 	 	 	 	 
	 	 	PURCHASER	 	 
	 
	 	 	 	 	 	 
	 	 	TIN INC., a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 

[Seller Signature Page Follows]

28

 

	 	 	 	 	 	 	 
	 	 	SELLER:	 	 
	 
	 	 	 	 	 	 
	 	 	CPT LOGCO, LLC, a Delaware limited 

liability
company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

Stanley G. Renecker
	 	 
	 

	 	Title:
	 	Authorized Signatory	 	 

29

 

SCHEDULE 1

SPECIFICATIONS

TIN Inc.

Orange

Purchased Delivered Pine Pulpwood Specifications

June 2007

1) Length: Tree Length (PP): Minimum — ***

Maximum — ***

Interlaced Loads (PP): Minimum — ***

Maximum — ***

Overlapped Loads (PP): Minimum — ***

Maximum —***

***

2) Maximum Diameter ***

3) Top Size: Minimum — ***

4) Fork: ***

5) Crook: ***

6) Burn/Char: ***

7) Rotten Wood: ***

8) Foreign Material: ***

9) Clear Hollows: ***

10) General Quality ***

11) Receiving: ***

***

Schedule 1

 

SCHEDULE 2

2008 ANNUAL PLAN

	 	 	 	 	 	 	 	 	 	 	 
	Compstand
	 	Est. Year
	 	County
	 	Technique
	 	Harvest Acres
	 	Total PP
	 	 	 	 	 	 	 	 	 	 	 
	***
	 	***
	 	***
	 	***
	 	***
	 	***

Schedule 2

 

SCHEDULE 3

2008 FORECAST PLAN

2009 Pine Pulpwood Forecast

	 	 	 	 	 	 	 
	 	 	Product	 	 	 	Tons
	 
	BUNA AREA

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	 	 	 	 	 
	 

	 	 	 	Total
	 	***
	 
	 	 	 	 	 	 
	DIBOLL AREA

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	 	 	 	 	 
	 

	 	 	 	Total
	 	***
	 
	 	 	 	 	 	 
	PINELAND AREA

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	 	 	 	 	 
	 

	 	 	 	Total
	 	***
	 
	 	 	 	 	 	 
	DEQUNICY AREA

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	Sum of Pine Pulpwood ***
	 	 	 	***
	 

	 	 	 	 	 	 
	 

	 	 	 	Total
	 	***
	 
	 	 	 	 	 	 
	 	 	
Total Pine Pulpwood ***	 	***
	 	 	
Total Pine Pulpwood ***	 	***
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Grand Total
	 	***
	2010 Pine Pulpwood Forecast

	 

	 	 	 	 	 	 
	 	 	
Total Pine Pulpwood	 	***

***

Schedule 3

 

SCHEDULE 4

ANNUAL MINIMUM VOLUME

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Annual Minimum Volumes	 	 	 	 
	 	 	Minimum Annual PPW Harvest Plan (000 Tons)	 	 
	 
	YEAR

	 	NTX
	 	STX
	 	LA
	 	CONS
	 	TOTAL
	2008

	 	***
	 	***
	 	***
	 	***
	 	***
	2009

	 	***
	 	***
	 	***
	 	***
	 	***
	2010

	 	***
	 	***
	 	***
	 	***
	 	***
	2011

	 	***
	 	***
	 	***
	 	***
	 	***
	2012

	 	***
	 	***
	 	***
	 	***
	 	***
	2013

	 	***
	 	***
	 	***
	 	***
	 	***
	2014

	 	***
	 	***
	 	***
	 	***
	 	***
	2015

	 	***
	 	***
	 	***
	 	***
	 	***
	2016

	 	***
	 	***
	 	***
	 	***
	 	***
	2017

	 	***
	 	***
	 	***
	 	***
	 	***
	2018

	 	***
	 	***
	 	***
	 	***
	 	***
	2019

	 	***
	 	***
	 	***
	 	***
	 	***
	2020

	 	***
	 	***
	 	***
	 	***
	 	***
	2021

	 	***
	 	***
	 	***
	 	***
	 	***
	2022

	 	***
	 	***
	 	***
	 	***
	 	***
	2023

	 	***
	 	***
	 	***
	 	***
	 	***
	2024

	 	***
	 	***
	 	***
	 	***
	 	***
	2025

	 	***
	 	***
	 	***
	 	***
	 	***
	2026

	 	***
	 	***
	 	***
	 	***
	 	***
	2027

	 	***
	 	***
	 	***
	 	***
	 	***
	2028

	 	***
	 	***
	 	***
	 	***
	 	***
	2029

	 	***
	 	***
	 	***
	 	***
	 	***
	2030

	 	***
	 	***
	 	***
	 	***
	 	***
	2031

	 	***
	 	***
	 	***
	 	***
	 	***
	2032

	 	***
	 	***
	 	***
	 	***
	 	***

Schedule 4

 

SCHEDULE 5

FREIGHT ADJUSTMENT

DEFINITIONS

	 	 	 
	A

	 	Base Haul Rate

$*** per loaded ton-mi as the base $  per loaded ton-mile trucking Cost
	B

	 	Benchmark Fuel Price

$*** per gallon as the base $  per gallon retail on-highway diesel price
	C

	 	Current Fuel Price

Based on ***
	D

	 	***
	E

	 	***

***
	F

	 	Rate Adjustment Factor

***
	G

	 	Current Haul Rate

***

HAUL RATE FUEL ADJUSTMENT

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Calculation
	A

	 	Base Haul Rate
	 	$***	 	 
	B

	 	Benchmark Fuel Price
	 	$***	 	 
	C

	 	Current Fuel Price
	 	$***	 	 
	D

	 	***
	 	***
	 	***
	E

	 	***
	 	***	 	 
	F

	 	Rate Adjustment Factor
	 	***
	 	***
	G

	 	Current Haul Rate
	 	$***
	 	***

Schedule 5

 

SCHEDULE 6

BASE PRICE

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	3Q 04	 	4Q 04	 	3Q 05	 	4Q 05	 	3Q 06	 	4Q 06	 	3Q 07
	 
	 	Louisiana	 	Zone 1	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Texas	 	Zone 2	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Texas	 	Zone 1	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Average Delivered using *** Adjustment Factor	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**	 	$	*	**
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Base Price	 	$	*	**
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	*** Adjustment Factor	 	 	 	 	 	 	 	 	 	Average prior three years *** Adjustment Factor	 	 	*	**%
	***%
	 	 	LA1	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	***%	 	 	TX2	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Quarterly Price	 	$	*	**
	***%
	 	 	TX1	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Schedule 6

 

SCHEDULE 7

PRICING EXAMPLE

PINE PULPWOOD DELIVERED PRICING TIMETABLE AND PRICE CALCULATION

Pricing process timetable is outlined below:

***

Example pricing calculation:

***

Schedule 7

 

SCHEDULE 8

DISTINCTIVE SITES

	 	 	 	 	 	 	 
	SITE	 	ACRES	 	DESCRIPTION	 	LOCATION
	 
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***

Schedule 8

 

SCHEDULE 9

BIOMASS HARVEST LOCATIONS

***

Schedule 9

 

Exhibit A

Description of Property

***

CONSERVATION BLOCK

***

 

 

Exhibit B

Form of Support Agreement

[see attached]

 

 

PULPWOOD SUPPORT AGREEMENT

***exv10w26

 

Exhibit 10.26

PORTIONS
OF THIS EXHIBIT MARKED BY ***
HAVE BEEN OMITTED PURSUANT TO A
REQUEST
FOR CONFIDENTIAL TREATMENT FILED SEPARATELY
WITH THE
SECURITIES AND EXCHANGE COMMISSION

SAWTIMBER SUPPLY AGREEMENT

BY AND BETWEEN

TIN INC., as Purchaser 

AND 

CPT LOGCO, LLC, as Seller

 

 

Table of Contents

	 	 	 	 	 
	ARTICLE I DEFINITIONS 
	 	 	1	 
	Section 1.1 Definitions
	 	 	1	 
	ARTICLE II HARVEST VOLUMES 
	 	 	7	 
	Section 2.1 Obligation to Purchase and Sell
	 	 	7	 
	Section 2.2 Annual Plan and Forecast Plan
	 	 	8	 
	Section 2.3 Obligated Volume
	 	 	8	 
	Section 2.4 Uncommitted Volume and Quarterly Meetings
	 	 	8	 
	Section 2.5 Biomass
	 	 	8	 
	Section 2.6 Post-Harvest Carbon Rights
	 	 	9	 
	ARTICLE III PRODUCT SPECIFICATIONS 
	 	 	9	 
	Section 3.1 Product Specifications
	 	 	9	 
	Section 3.2 Rejected Product
	 	 	9	 
	ARTICLE IV PRICE SCHEDULE 
	 	 	10	 
	Section 4.1 Initial Price
	 	 	10	 
	Section 4.2 Quarterly Price
	 	 	10	 
	ARTICLE V DELIVERY, FORCE MAJEURE AND PAYMENT 
	 	 	10	 
	Section 5.1 Delivery, Scaling and Weighing
	 	 	10	 
	Section 5.2 Force Majeure
	 	 	13	 
	Section 5.3 Change Event
	 	 	14	 
	Section 5.4 Payment
	 	 	14	 
	ARTICLE VI TERM 
	 	 	14	 
	Section 6.1 Term
	 	 	14	 
	Section 6.2 Extension of Term
	 	 	14	 
	Section 6.3 Effect of Termination
	 	 	14	 
	ARTICLE VII REPRESENTATIONS AND WARRANTIES 
	 	 	14	 
	Section 7.1 Representations and Warranties of Purchaser
	 	 	14	 
	Section 7.2 Representations and Warranties of Seller
	 	 	15	 
	ARTICLE VIII SELLER’S MANAGEMENT 
	 	 	16	 
	Section 8.1 Seller’s Management
	 	 	16	 
	ARTICLE IX DEFAULT AND DISPUTE RESOLUTION 
	 	 	17	 
	Section 9.1 Default by Purchaser
	 	 	17	 
	Section 9.2 Default by Seller
	 	 	18	 
	Section 9.3 Specific Performance
	 	 	18	 
	Section 9.4 Liquidated Damages
	 	 	19	 
	Section 9.5 Assignment of Agreement
	 	 	19	 
	Section 9.6 Dispute Resolution
	 	 	19	 
	ARTICLE X INDEMNITY AND INSURANCE 
	 	 	21	 
	Section 10.1 Purchaser’s Indemnity
	 	 	21	 
	Section 10.2 Seller’s Indemnity
	 	 	21	 
	Section 10.3 Insurance
	 	 	21	 
	Section 10.4 Notice of Claim
	 	 	22	 
	ARTICLE XI ASSIGNMENT AND TRANSFERS 
	 	 	22	 
	Section 11.1 Seller’s Assignment Rights
	 	 	22	 
	Section 11.2 Purchaser’s Assignment Rights
	 	 	23	 

-ii-

 

	 	 	 	 	 
	ARTICLE XII AUDIT RIGHTS 
	 	 	23	 
	Section 12.1 Audit Rights
	 	 	23	 
	ARTICLE XIII NOTICES 
	 	 	23	 
	Section 13.1 Notices
	 	 	23	 
	ARTICLE XIV MISCELLANEOUS 
	 	 	24	 
	Section 14.1 Amendments
	 	 	24	 
	Section 14.2 Recording of Agreement
	 	 	24	 
	Section 14.3 Compliance with Laws
	 	 	25	 
	Section 14.4 Confidentiality
	 	 	25	 
	Section 14.5 Estoppel Certificates
	 	 	25	 
	Section 14.6 No Waiver; Remedies
	 	 	25	 
	Section 14.7 Accounting Terms
	 	 	25	 
	Section 14.8 Binding Effect; Governing Law
	 	 	25	 
	Section 14.9 Counterparts
	 	 	25	 
	Section 14.10 Time of the Essence
	 	 	25	 
	Section 14.11 Incorporation of Exhibits and Schedules
	 	 	25	 
	Section 14.12 Interest
	 	 	25	 
	Section 14.13 Further Assurances
	 	 	26	 
	Section 14.14 Most Favored Status
	 	 	26	 
	Section 14.15 Attorney’s Fees
	 	 	26	 
	Section 14.16 Severability
	 	 	26	 
	Section 14.17 Captions and Headings
	 	 	26	 
	Section 14.18 Construction
	 	 	26	 
	Section 14.19 Relationship
	 	 	27	 
	Section 14.20 Integration
	 	 	27	 
	Section 14.21 Uniform Commercial Code
	 	 	27	 

INDEX

	 	 	 
	SCHEDULES	 	 
	Schedule 1

	 	Specifications
	Schedule 2

	 	2008 Annual Plan
	Schedule 3

	 	2008 Forecast Plan (for years 2009-2011)
	Schedule 4

	 	Annual Minimum Volumes and Annual Obligation Floors
	Schedule 5

	 	Freight Adjustment
	Schedule 6

	 	Initial Price
	Schedule 7

	 	Product Volume Range
	Schedule 8

	 	Distinctive Sites
	Schedule 9

	 	Biomass Harvest Locations
	Schedule 10

	 	Obligated Volume Products and Delivery Points for 2007 and 2008
	Schedule 11

	 	Pricing Example

	 	 	 
	EXHIBITS	 	 
	Exhibit A

	 	Description of Property
	Exhibit B

	 	Form of Support Agreement

-iii-

 

SAWTIMBER SUPPLY AGREEMENT

     THIS SAWTIMBER SUPPLY AGREEMENT (this “Agreement”) is made and entered into as of this
31st day of October, 2007 (the “Effective Date”) by and between TIN INC., a Delaware
corporation (“Purchaser”), and CPT LOGCO, LLC, a Delaware limited liability company (“Seller”).

RECITALS

	 	A.	 	Purchaser and Landowner entered into that certain Purchase Agreement dated August 3,
2007, as amended by that certain Amended and Restated Purchase Agreement dated October 31,
2007 (as amended, the “Purchase Agreement”), pursuant to which Purchaser sold and Crown
Pine Timber 1, L.P., a Delaware limited partnership, Crown Pine Timber 2, L.P., a Delaware
limited partnership, Crown Pine Timber 3, L.P., a Delaware limited partnership, and Crown
Pine Timber 4, L.P., a Delaware limited partnership (collectively, “Landowner”), acquired
approximately 1,469,507 acres of real property located in Anderson, Angelina, Cherokee,
Houston, Jefferson, Liberty, Nacogdoches, Orange, Panola, Rusk, San Jacinto, Shelby,
Trinity, Newton, Sabine, San Augustine, Hardin, Jasper, Polk and Tyler Counties, Texas; and
Allen, Beauregard, Calcasieu, Jefferson Davis, Rapides, Sabine and Vernon Parishes,
Louisiana, being more particularly described in Exhibit A attached hereto (the “Property”);
and
	 
	 	B.	 	Purchaser and Crown Pine Parent, L.P., a Delaware limited partnership, of which each
entity constituting Landowner is a wholly owned subsidiary, are simultaneously entering
into a Sawtimber Support Agreement substantially in the form attached hereto as Exhibit B
(the “Support Agreement”), pursuant to which Landowner is providing certain assurances and
agreements to Purchaser with respect to the availability of the cutting rights contemplated
and required by this Agreement; and
	 
	 	C.	 	Purchaser desires to buy and receive, and Seller desires to sell, deliver and provide
Product (as defined herein) from the Property; and
	 
	 	D.	 	Purchaser and Seller desire to purchase and sell Product pursuant to the terms of this
Agreement at the fair market price;

     IN CONSIDERATION of the mutual covenants contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser
hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Definitions. As used herein, the following terms will have the meanings ascribed
thereto:

     “AAA” means the American Arbitration Association.

 

 

     “Acts of God” means events which are caused solely by the effects of nature or natural causes,
without interference by any person, consisting of insect infestations, floods, earthquakes,
tornados, hurricanes, fires, lightening and extraordinary amounts of rain that materially and
adversely impact the ability to harvest timber.

     “Affiliate” means, with respect to any Person, another Person which, directly or indirectly,
controls, is controlled by, or is under common control with, the first Person.

     “Agreement” shall have the meaning provided in the first paragraph of this Agreement.

     “Annual Harvest Option Volume” means *** of the excess of the Annual Harvest Volume over the
Obligation Floor.

     “Annual Harvest Volume” means the volume of Product that Seller plans to harvest during a
Harvest Year as set forth in the Annual Plan for such Harvest Year.

     “Annual Minimum Volume” means the volume of Product that Seller is obligated to make available
for harvest from the Property during a Harvest Year. The Annual Minimum Volume for each Harvest
Year is set forth on Schedule 4 attached hereto.

     “Annual Plan” means a written annual harvest plan prepared by Seller pursuant to Section 2.2
hereof detailing (i) the planned Annual Harvest Volume of each Product (by tract) and (ii) tract
locations for the Product during a Harvest Year. An Annual Plan shall include stand data
(including age of each stand) and a map of each tract to be harvested during such Harvest Year;
provided, however, Seller may substitute tracts from the Property without notice to or consent of
Purchaser so long as such substitution does not result in increased cost or inconvenience to
Purchaser.

     “Biomass” means standing trees (excluding Pulpwood and other merchantable timber) and/or
vegetation that can be commercially preharvested, or standing and down woody material and debris
existing after a harvesting operation.

     “Biomass Offer” has the meaning set forth in Section 2.5 hereof.

     “Carbon Rights” means any carbon sequestration credits or offsets, renewable energy credits or
similar method of attribution of a value, right or privilege for carbon sequestration that may be
used to satisfy limits on carbon dioxide emissions or to reduce taxes, assessments or penalties on
carbon dioxide emissions.

     “Carryover Volume” has the meaning provided in Section 5.1(c) hereof.

     “Certificate of Insurance” means a written certification with respect to each party’s
insurance policies required hereunder by or on behalf of the insurance company or companies issuing
the insured party’s insurance policies stating, (i) the name of the insurance company or companies
issuing the insurance policy, (ii) the deductible amount, (iii) types of coverage, (iv)
the premium amount, (v) the expiration date, (vi) the policy limit or face amount, (vii)
waiver of

2

 

subrogation, (viii) that the other party may rely on such certificate, and (ix) that such
insurance policy shall not be cancelled, amended or non-renewed without providing the other party
with at least thirty (30) days’ prior written notice.

     “Change Event” means (i) a closing of a Mill or an operating line within a Mill, (ii) the sale
of a Mill, or (iii) a material decrease in Purchaser’s requirements for Product as a result of a
change in a manufacturing process at a Mill.

     “Chip-n-Saw” means pine sawtimber having a minimum top (diameter inside bark) equal to or
greater than ***.

     “Conservation Block” means the conservation areas containing approximately *** acres described
on Exhibit A.

     “Delivery Plan” has the meaning set forth in Section 5.1(a) hereof.

     “Delivery Point” means each Mill, Purchaser’s woodyard in Silsbee, Texas, Purchaser’s woodyard
in Lufkin, Texas and/or such other location at which the Product is delivered by Seller, as shall
be designated in the Delivery Plan or by Purchaser in Purchaser’s sole discretion from time to
time.

     “Distinctive Site” means any site described on Schedule 8 attached hereto.

     “Effective Date” shall have the meaning provided in the first paragraph of this Agreement.

     “Environmental Laws” means any United States federal, state or local laws and the regulations
promulgated thereunder, relating to pollution or protection of the environment or to threatened or
endangered species, including laws relating to wetlands protection, laws relating to reclamation of
land and waterways and laws relating to emissions, discharges, disseminations, releases or
threatened releases of hazardous or toxic substances or petroleum (and its fractions) into the
environment (including, without limitation, ambient air, surface water, ground water, soil, land
surface or subsurface strata) or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of hazardous or toxic substances or
petroleum (and its fractions), including, without limitation, the following laws and regulations
promulgated thereunder as amended from time to time: (i) the Comprehensive Environmental Response,
Compensation and Liability Act (as amended by the Superfund Amendments and Reauthorization Act), 42
U.S.C. § 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et
seq.; (iii) the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq.; (iv) the Toxic
Substances Control Act, 15 U.S.C. § 2601 et seq.; (v) the Clean Water Act, 33 U.S.C. § 1251 et
seq.; (vi) the Clean Air Act, 42 U.S.C. § 1857 et seq.; and (vii) the Endangered Species Act, 16
U.S.C. §1531 et seq.; and (viii) all laws of the states in which the Property is located that are
based on, or substantially similar to, the federal statutes listed in parts (i) through (vii) of
this paragraph.

3

 

     “Final Quarterly Price” means a price computed for each Product at each applicable Delivery
Point equal to the weighted average delivered cost for such Product at such Delivery Point,
excluding the purchase of Substitute Products, woodyard transactions, transactions with Seller
(pursuant to this Agreement or otherwise), internal transactions, timber deeds and supply
agreements having a term in excess of ***. If a minimum of *** tons of quarterly comparable
purchases for such Product at such Delivery Point, representing not less than *** different
suppliers, does not exist then the pricing information for the closest Delivery Point which meets
the tonnage and supplier threshold set forth above shall be used. If no Delivery Point meets such
threshold, then Seller and Purchaser shall negotiate the Final Quarterly Price in good faith and
any dispute with respect to such price shall be resolved in accordance with Section 9.6(b) hereof.

     “Force Majeure” means any cause, condition or event beyond the reasonable control of a party,
which the party in question, despite the use of good faith and commercially reasonable efforts, is
unable to overcome, that delays or prevents such party’s performance of its obligations hereunder,
consisting solely of war, war-like operations, invasions, rebellion, acts of terrorism, military or
usurped power, sabotage, acts of government, acts of public enemy, riots, fires, explosions, Acts
of God, labor strikes, disputes or lockouts by employees, general suspension of payments by banks
in the United States, and an involuntary ceasing of operations at the Mill for a minimum of thirty
(30) consecutive days. Force Majeure shall not include, (i) a party’s financial inability to
perform, (ii) non-violent, civil demonstrations, (iii) an act or omission arising from the willful
misconduct of the party claiming that a Force Majeure event has occurred, or (iv) any rainfall
which does not constitute an Act of God.

     “Forecast Plan” means a written harvest plan prepared by Seller pursuant to Section 2.2
detailing the forecasted Annual Harvest Volume during the two (2) Harvest Years immediately
following the Harvest Year in the Annual Plan delivered to Purchaser pursuant to Section 2.2, and,
for tracts to be harvested during the first Harvest Year set forth in any Forecast Plan,
designation of the geographic locations from which the Product will be harvested.

     “Freight Adjustment” means an increase or decrease in the applicable Quarterly Price or Final
Quarterly Price for Product delivered pursuant to this Agreement in accordance with the formula set
forth on Schedule 5 provided that the parties shall agree upon any adjustments to the Freight
Adjustment every *** year after the year of the Effective Date.

     “Harvest Year” means a calendar year beginning on January 1 and ending on December 31. The
first full “Harvest Year” of this Agreement shall begin on January 1, 2008 and end on December 31,
2008. The periods from the Effective Date to December 31, 2007 and from January 1 in the final
calendar year of the Term to the date the Term expires shall be deemed partial “Harvest Years.”

     “Initial Price” has the meaning set forth in Section 4.1 hereof.

     “Large Sawtimber” means pine sawtimber having a top (diameter inside bark) equal to or greater
than 11 inches.

4

 

     “Liens” means any and all liens, charges, mortgages, deeds to secure debt, pledges, security
interests, options of record, adverse claims or other encumbrances of a liquidated amount or which
are otherwise statutorily enforceable, other than liens for ad valorem taxes not yet due and
payable.

     “Master Stumpage Agreement” means, collectively, those certain Master Sawtimber Stumpage
Agreements dated October 31, 2007, by and between Seller and each entity constituting Landowner,
with respect to the Property.

     “Medium Sawtimber” means pine sawtimber having a top (diameter inside bark) equal to or
greater than 9 inches.

     “Mill” means any of the sawmills owned by Purchaser and located in Buna, Texas, Diboll, Texas,
Pineland, Texas and DeQuincy, Louisiana, the stud mill owned by Purchaser in Pineland, Texas and
any other mill that Purchaser leases or in which Purchaser has an ownership interest exceeding
forty-nine percent (49%) in the States of Texas or Louisiana during the Term of this Agreement.

     “Obligated Volume” means the minimum volume of Product from the Property, determined by
Purchaser in accordance with Section 2.3, that Seller is required to deliver to Purchaser and
Purchaser is required to purchase during a Harvest Year in accordance with the terms of this
Agreement.

     “Obligation Floor” means, for any given Harvest Year, the smallest permissible Obligated
Volume, as set forth on Schedule 4 attached hereto.

     “Option” has the meaning set forth in Section 6.2 hereof.

     “Option Period” has the meaning set forth in Section 6.2 hereof.

     “Panel” has the meaning set forth in Section 9.6(a) hereof.

     “Panel Chairman” has the meaning set forth in Section 9.6(a) hereof.

     “Person” means any individual, sole proprietorship, trust, estate, executor, legal
representative, unincorporated association, institution, corporation, company, partnership, limited
liability company, limited liability partnership, joint venture, government (whether national,
federal, state, county, city, municipal or otherwise, including, without limitation, any
instrumentality, division, agency, body or department thereof) or other entity.

     “Pole” means sawtimber with characteristics making it suitable for use as a utility or
structural pole.

     “Price Dispute” has the meaning set forth in Section 9.6(b) hereof.

5

 

     “Primary Delivery Zone” with respect to any Delivery Point means all those tracts of Property
located not more than *** road miles from such Delivery Point.

     “Product” means the harvested Chip-n-Saw, Small Sawtimber, Medium Sawtimber and Large
Sawtimber meeting the applicable Specifications, excluding Poles as determined by Seller in
Seller’s sole discretion.

     “Product Reduction” means the amount of Product volume no longer required by a Mill due to a
Change Event.

     “Product Volume Range” means the range of Obligated Volume (expressed as a percentage) for
each Product which shall be delivered to each Mill during any Harvest Year. The initial schedule
of Product Volume Ranges is set forth on Schedule 7 hereto. Purchaser shall have the right to
amend the Product Volume Ranges at any time and from time to time during the Term provided that no
such change shall materially impair the ability of Seller to comply with its obligations under this
Agreement.

     “Property” shall have the meaning provided in Recital A of this Agreement.

     “Purchaser” shall have the meaning provided in the first paragraph of this Agreement.

     “Purchaser Event of Default” has the meaning set forth in Section 9.1 hereof.

     “Purchaser Indemnitee” has the meaning set forth in Section 10.2 hereof.

     “Quarterly Delivery Variance” has the meaning set forth in Section 5.1(b) hereof.

     “Quarterly Price” means, for any calendar quarter, the Final Quarterly Price for each Product
at the applicable Delivery Point for the immediately preceding calendar quarter adjusted by the
average *** Adjustment Factor applicable to the calendar quarter in question for the immediately
preceding ***.

     “Renewal Period” has the meaning set forth in Section 6.2 hereof.

     “Residual Biomass” means Biomass associated with stands harvested from the Property by Seller
in connection with the performance of its obligations under this Agreement.

     “SFI Standards” means standards for harvesting activities meeting the minimum requirements for
compliance with the standards of the Sustainable Forestry Initiative, 2005-2009, of the American
Forest and Paper Association and any successor thereto, as those standards may be modified from
time to time by the American Forest and Paper Association and any successor thereto.

     “Secondary Delivery Zone” with respect to any Delivery Point means all those tracts of
Property located more than *** road miles from such Delivery Point.

6

 

     “Seller” shall have the meaning provided in the first paragraph of this Agreement.

     “Seller Event of Default” has the meaning set forth in Section 9.2 hereof.

     “Seller Indemnitee” has the meaning set forth in Section 10.1 hereof.

     “Small Sawtimber” means pine sawtimber having a top (diameter inside bark) equal to or greater
than ***.

     “Specifications” means the technical specifications for Product delivered to Purchaser in
accordance with this Agreement, as they exist from time to time pursuant to the terms of Section
3.1. The Specifications as of the Effective Date are more particularly set out in Schedule 1
hereto.

     “Substitute Products” shall have the meaning provided in Section 5.1(c).

     “Term” shall have the meaning provided in Section 6.1.

     “Termination Date” means the effective date of termination of this Agreement in accordance
with its terms by Purchaser or Seller at any time other than the expiration of the Term.

     ***

     “*** Adjustment Factor” means, for any calendar quarter, the percentage change in the
applicable average price for the applicable product type in the relevant geographic zone between
the end of the immediately preceding calendar quarter and the end of the applicable calendar
quarter, as such average prices are reported by *** and ***. For Chip-n-Saw the applicable average
price will be for delivered pine chip-n-saw. For Small Sawtimber the applicable average price will
be *** delivered pine chip-n-saw and *** delivered pine sawtimber. For Medium and Large Sawtimber
the applicable average price will be for delivered pine sawtimber.

     “Transfer” means any direct or indirect transfer, sale, assignment, pledge, hypothecation or
other disposition of ownership or control of the Property.

     “Uncommitted Volume” means any Product that Seller elects to harvest from the Property during
a Harvest Year in excess of the Annual Harvest Volume for such Product set forth in the Annual Plan
for such Harvest Year.

ARTICLE II

HARVEST VOLUMES

     Section 2.1 Obligation to Purchase and Sell. In accordance with the terms hereof, during the Term
Purchaser covenants and agrees to purchase and receive from Seller and Seller covenants and agrees
to sell, deliver and provide to
Purchaser, in each Harvest Year, the Obligated Volume at the Delivery Point(s) specified by
Purchaser.

7

 

     Section 2.2 Annual Plan and Forecast Plan. On or before September 30 of each year during the Term,
Seller shall deliver to Purchaser an Annual Plan for the immediately following Harvest Year and a
Forecast Plan. The aggregate Annual Harvest Volume of Product set forth in an Annual Plan shall in
no event be less than the Annual Minimum Volume for the same Harvest Year. The annual volume set
forth in an Annual Plan (i) shall not vary by more than *** from the forecast volume for such
Harvest Year as set forth in the previous year’s Forecast Plan, and (ii) shall not vary by more
than *** from the forecast volume for such Harvest Year as set forth in the Forecast Plan delivered
to Purchaser two years earlier. The Annual Plan for Harvest Year 2008 and Forecast Plan for
Harvest Years 2009 and 2010 are attached hereto as Schedule 2 and Schedule 3, respectively.

     Section 2.3 Obligated Volume. On or before November 1 of each year during the Term, Purchaser
shall notify Seller in writing of the Obligated Volume which Purchaser elects to purchase and
receive from Seller during the upcoming Harvest Year which will be broken down by Product and
Delivery Point and Seller agrees to deliver such volume of each Product to each such Delivery Point
in accordance with the terms of this Agreement. The Obligated Volume shall equal the sum of (i)
the Obligation Floor plus (ii) such portion of the Annual Harvest Option Volume that Purchaser
elects to purchase during the upcoming Harvest Year. The Obligated Volume for Harvest Year 2007
shall be *** tons and the Obligated Volume for Harvest Year 2008 shall be *** tons, broken down by
Product and Delivery Point as set forth in Schedule 10 hereto.

     Section 2.4 Uncommitted Volume and Quarterly Meetings. Purchaser and Seller shall meet quarterly
each Harvest Year, on or before March 1, June 1, September 1 and December 1, to discuss the
then-current Obligated Volume and any Uncommitted Volume. Purchaser shall have the right to
purchase at the applicable Quarterly Price any portion, not to exceed ***, of the Uncommitted
Volume. Seller shall make all of the Uncommitted Volume contained within each Primary Delivery Zone
available to fulfill any such portion purchased by Purchaser, and shall deliver such portion in
accordance with a delivery schedule that the parties shall mutually agree upon at the time of
Purchaser’s election. Seller shall not have the right to count any purchased Uncommitted Volume
towards the Obligated Volume. Purchaser and Seller shall compute the Final Quarterly Price for
such purchased Uncommitted Volume pursuant to, and shall remit any excess in accordance with,
Section 4.2.

     Section 2.5 Biomass. Purchaser shall have the right to offer, on or before November 1 of each
calendar year during the Term, to purchase, collect and retain any Residual Biomass by notifying
Seller in writing of the volume of Residual Biomass that Purchaser offers to purchase, collect and
retain, which notice shall include the price Purchaser will pay for such Biomass and, with
reasonable specificity, the location of such Biomass (a “Biomass Offer”). Seller shall have thirty
(30) days to accept or
reject such Biomass Offer by written notice delivered to Purchaser. If Seller fails to deliver
such written notice within the thirty (30) day period, Seller shall be deemed to have rejected the
Biomass Offer. Seller shall have the right to sell such Residual Biomass to any third party only
upon the actual or deemed rejection of such Biomass Offer and under no other circumstances. If
Seller accepts a Biomass Offer, Purchaser and Seller shall enter into a usual and customary
agreement with respect to Purchaser’s entrance upon the Property and Purchaser’s collection of
Biomass from the Property. Notwithstanding anything in this Section 2.5 to the contrary, “Residual
Biomass” shall exclude any Biomass that Seller is obligated to sell

8

 

to a third party under a
contract with a term of at least one (1) year. Purchaser shall purchase, collect and retain ***
tons of Residual Biomass during Harvest Year 2007 and *** tons of Residual Biomass in Harvest Year
2008 from the harvest locations as set forth in Schedule 9.

     Section 2.6 Post-Harvest Carbon Rights. Prior to the severance of the Product from the Property,
Seller shall have exclusive Carbon Rights in the Property and in all standing, harvested or fallen
trees or other vegetation on the Property. To the extent Carbon Rights associated with severed
wood products can be transferred under any existing or future, mandatory or voluntary, carbon
dioxide allocation, trading, taxation or other emissions limitation regime, the sale of Product
under this Agreement shall include as part of such sale any and all Carbon Rights associated with
the Product. Purchaser shall have no claim or right to any Carbon Rights associated with the
Property (whether fee or leasehold interest), or, prior to the severance of Product from the
Property, with standing, harvested or fallen trees or other vegetation on the Property, but Seller
shall not separate any transferable Carbon Rights from Product sold to Purchaser prior to sale.

ARTICLE III

PRODUCT SPECIFICATIONS

     Section 3.1 Product Specifications. Any and all Product delivered shall meet the Specifications.
Purchaser may modify, amend, add to, alter, revise or change the Specifications at any time during
the Term by giving Seller not less than thirty (30) days advance written notice of any
modification, amendment, addition, alteration, revision or change to the Specifications, provided
that any such modification, amendment, addition, alteration, revision or change to the
Specifications does not materially and adversely impact Seller’s ability to comply with its
obligations hereunder; provided further that any such modification, amendment, addition,
alteration, revision or change to the Specifications shall be applicable to all suppliers of the
applicable Mill, and provided further that Purchaser shall not modify the Specifications to set
higher standards for Seller than for any other suppliers of comparable product to the applicable
Delivery Points.

     Section 3.2 Rejected Product. Purchaser has the right to reject any or all Product not meeting the
Specifications applicable at the time of delivery; provided, however, at Seller’s request,
Purchaser shall (i) provide Seller with a written or photographic explanation for the basis of any
such rejection, and (ii) afford
Seller the opportunity to inspect, within a reasonable period of time, any such rejected Product.
Product rejected for failure to meet Specifications shall not be included in calculating whether
Seller met its required Obligated Volume. EXCEPT FOR THE SPECIFICATIONS SET FORTH IN THIS
AGREEMENT, SELLER DISCLAIMS ALL WARRANTIES OF ANY KIND INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. In the event Purchaser rejects
any or all Product not meeting the Specifications, Purchaser, at Seller’s sole cost, risk and
expense, may reload, or cause to be reloaded, the rejected Product onto Seller’s vehicles or any
other vehicles delivering Product to Purchaser. Seller shall remove and dispose of any rejected
Product at Seller’s sole cost, risk and expense. Notwithstanding the foregoing, Purchaser shall
have the option, at its sole election, to purchase any of such rejected Product following any
requested written or photographic explanation and

9

 

inspection process as described above, at a price
mutually agreed to by Seller and Purchaser, in which event such Product shall not be included in
calculating whether Seller met its required Obligated Volume.

ARTICLE IV

PRICE SCHEDULE

     Section 4.1 Initial Price. The initial price for each Product delivered by Seller to Purchaser at
each Delivery Point during the period commencing on the Effective Date and ending on December 31,
2007 shall be as set forth in Schedule 6 attached hereto (the “Initial Price”).

     Section 4.2 Quarterly Price. The price paid by Purchaser for Product delivered during any calendar
quarter during the Term shall be the Quarterly Price. Within twenty (20) days after the end of
every calendar quarter, Seller and Purchaser shall compute the Final Quarterly Price. If the Final
Quarterly Price is greater than the Quarterly Price paid for such calendar quarter, then Purchaser
shall remit to Seller the additional amount owed by Purchaser within fifteen (15) days after the
calculation. If the Final Quarterly Price is less than the Quarterly Price paid for such calendar
quarter, then Seller shall remit to Purchaser the amount of such overage, and if Seller fails to
remit such amount within fifteen (15) days after the calculation of such overage, Purchaser shall
have the right to offset the overage against amounts next due and owing to Seller under this
Agreement. An example of the pricing mechanism set forth herein is set forth on Schedule 11
attached hereto.

ARTICLE V

DELIVERY, FORCE MAJEURE AND PAYMENT

     Section 5.1 Delivery, Scaling and Weighing.

     (a) No later than each November 1 during the Term, Purchaser shall propose to Seller a target
quarterly delivery schedule with respect to the Obligated Volume for the upcoming Harvest Year.
The parties shall work together to jointly develop a mutually
acceptable quarterly delivery schedule for such Harvest Year (the “Delivery Plan”), which
Delivery Plan shall be agreed upon no later than December 1. The quarterly volumes set forth in
the Delivery Plan will be based on Purchaser’s targeted quarterly inventory volumes for each Mill
but will fall within the percentage ranges for Obligated Volume set forth below:

	 	 	 
	Calendar Quarter	 	Percentage of Obligated Volume
	1

	 	***
	2

	 	***
	3

	 	***
	4

	 	***

10

 

The Delivery Plan shall set forth the allocation of the Obligated Volume among the Delivery Points
by Product, which allocation must fall within the then applicable Product Volume Range. During any
Harvest Year Purchaser may, upon five (5) days’ prior written notice to Seller, re-allocate the
Obligated Volume among the Delivery Points, provided that if, as a result of such re-allocation,
the haul distance from the harvested tract to the new Delivery Point exceeds ***road miles, an
appropriate Freight Adjustment shall be made.

     (b) The parties recognize a mutual benefit to produce and accept Product as consistently as
possible with such Delivery Plan. Seller shall use commercially reasonable efforts to dispatch
deliveries on a relatively even flow basis within each calendar quarter of the Harvest Year. It is
understood and agreed that material deviations to the Delivery Plan may occur due to weather
conditions or other unforeseen events. In such event, quarterly deliveries may be less than the
Delivery Plan’s total applicable quarterly volume by up to *** (the total percentage of such
variance being the “Quarterly Delivery Variance”).

     (c) In the event the Quarterly Delivery Variance during any quarter exceeds *** of the total
volume required to be delivered during such quarter pursuant to the applicable Delivery Plan,
Purchaser may purchase Products or substitutes therefor (in either case, “Substitute Products")
from any third party in sufficient volumes to equal the Quarterly Delivery Variance at current fair
market prices for the applicable Products. If Purchaser purchases such Substitute Products,
Seller, in lieu of the remedies set forth in Section 9.4, shall promptly pay Purchaser the
difference between the highest price paid by Purchaser for the corresponding volume of Product at
each relevant Delivery Point for such Substituted Products and the applicable Final Quarterly
Price. If Seller fails or refuses to pay such amount to Purchaser within ten (10) days after
Purchaser’s request therefor, Purchaser shall have the right to offset such amount against amounts
next due and owing to Seller by Purchaser hereunder. The applicable Obligated Volume shall be
reduced by the volume of any Substitute Products purchased by Purchaser.

     (d) In the event the quarterly deliveries exceed the Delivery Plan’s applicable quarterly
volume by more than ***, any such volume delivered by Seller in excess of such ***
threshold shall be sold at a price agreed upon by Purchaser and Seller at the time of such
delivery, and, unless agreed to by Purchaser in writing, such excess volume shall not be applied
against the Obligated Volume.

     (e) At the end of any Harvest Year, if there is (i) a negative annual variance with respect to
the Obligated Volume required to be delivered to any Delivery Point pursuant to the Annual Plan for
such Harvest Year, or (ii) a negative annual variance between (A) the percentage of any particular
Product delivered to a specified Delivery Point and (B) the lower bound of the applicable Product
Volume Range with respect to such Delivery Point, Purchaser shall have the right either to deduct
the amount of such negative annual variance from the Obligated Volume for the Product or Products
causing the negative annual variance, as the case may be, or to require Seller to deliver such
volume of Product or Products causing the negative annual

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variance, as the case may be, (the
"Carryover Volume”), in the first quarter of the following Harvest Year to such Delivery Point, at
a price equal to the lower of: (x) the lowest Final Quarterly Price for the applicable Product for
all quarters during the previous Harvest Year, or (y) the Final Quarterly Price for the applicable
Product for the calendar quarter in which the Carryover Volume is delivered. If Seller is required
to deliver Carryover Volume as a result of clause (i) of this Section 5.1(e), Seller may deliver as
Carryover Volume any mix of Products accepted at such Delivery Point provided that the volume of
each Product, when added to the volume of such Product delivered to such Delivery Point during the
year of the negative annual variance, falls within the Product Volume Range for such Product at
such Delivery Point. Any delivery in the following Harvest Year will first be counted towards
meeting the Carryover Volume requirement. Deliveries during the fourth quarter shall only be
applied against the then current Harvest Year’s delivery requirements. The parties shall work
together in good faith to adjust delivery schedules to accommodate temporary or unforeseen
hardships for either party. Each party shall notify the other party of any anticipated delays as
soon as such delay is anticipated.

     (f) Unless otherwise agreed to in writing by Purchaser, any portion of the Annual Harvest
Volume harvested within the Primary Delivery Zone shall be delivered to a Mill or such other
Delivery Point designated by Purchaser in accordance herewith, until the Obligated Volume for such
Harvest Year has been fully met. Prior to delivering any Product to a Delivery Point from the
Secondary Delivery Zone with respect to such Delivery Point, Seller must obtain the written consent
of Purchaser, which consent may be withheld in Purchaser’s sole discretion, unless such delivery
was contemplated by the Delivery Plan for such Harvest Year. Any Product delivered by Seller from
within a Secondary Delivery Zone in accordance with the preceding sentence shall be subject to a
Freight Adjustment.

     (g) Under no circumstances shall Purchaser be required to purchase during any Harvest Year any
Product at any Delivery Point in excess of the upper bound of the Product Volume Range for such
Product at such Delivery Point.

     (h) Subject to Purchaser’s prior written consent, exercisable in Purchaser’s reasonable
discretion, Seller may redirect the delivery of all or a portion of the Product to be delivered by
Seller hereunder to a Delivery Point other than the Delivery Point required under the applicable
Delivery Plan.

     (i) All Product subject to this Agreement shall be delivered to Purchaser F.O.B. to the
designated Delivery Point during the regular business hours of such Delivery Point. Risk of loss
and title to the Product shall pass from Seller when the Product is unloaded and accepted by
Purchaser pursuant to the terms hereof. All Product delivered hereunder by Seller shall be scaled
or weighed by Purchaser, or its designee, upon delivery at the respective Delivery Point using
privately verified scales, which data shall be recorded by the scaler (or weigher) on scale or
weight tickets and a copy of each ticket shall be given to Seller or its designated representative.
Additional information reasonably required by the parties from time to time or by state law,
including but not limited to origin by tract location of delivered Product, shall also be included
on the scale ticket or provided in such other format as may be reasonably requested by Purchaser.
Seller shall (i) adhere to Purchaser’s requirements for delivery as are established from time to
time to conform with changes in law, forestry practices and Purchaser’s operational

12

 

requirements,
provided such adjustments are comparable to industry standards and are similar to those required by
Purchaser of its other suppliers and (ii) comply with all applicable laws, rules and regulations.

     Section 5.2 Force Majeure. Subject to the provisions of this Section 5.2, neither party shall be
liable hereunder, and performance shall be excused, for a delay in or failure of performance of its
obligations hereunder caused by a Force Majeure event, provided, however, no excuse for performance
due to a Force Majeure delay under this Section 5.2 shall be effective unless the party
experiencing such delay shall have notified the other party of the delay within ten (10) days of
the event giving rise to such delay, unless the failure to provide this notice has not caused
prejudice to the other party, in which event excuse for performance shall be effective. To the
extent performance has been excused, neither party shall be required to make up performance which
has been excused upon termination or expiration of the Force Majeure event. The parties shall use
commercially reasonable efforts to mitigate the effects of the Force Majeure event, and if the
cause of Force Majeure can be minimized or remedied, the parties shall use reasonable best efforts
to do so promptly.

     (a) Notwithstanding anything herein to the contrary, if, as a result of a Force Majeure event
pursuant to which a delay in Seller’s performance is excused hereunder, or for any other reason
deliveries from Seller are reduced to the extent Purchaser cannot maintain its scheduled Products
inventory at the Mill, Purchaser shall, upon notice to Seller, have the right to obtain Substitute
Products from sources other than Seller until such time as Seller is again able to commence the
delivery of Product to Purchaser. After Seller gives notice to Purchaser that it is again able to
commence delivery of Product pursuant to the terms of this Agreement, Purchaser shall notify Seller
of any commitments for Substitute Products that Purchaser has entered into. Purchaser shall not be
required to accept from Seller the amount by which the Products volume was reduced until such time
as Purchaser has accepted delivery of all Substitute Products contracted by Purchaser, provided
that no such contract for Substitute Products shall be for a term longer than one (1) month without
consent of Seller, which consent shall not be unreasonably withheld, conditioned or delayed.

     (b) Notwithstanding anything herein to the contrary, if, as a result of a Force Majeure event
pursuant to which Purchaser cannot accept the quantity of Products provided for
herein, Purchaser shall promptly so notify Seller, and Seller shall thereafter have the right
to contract for the sale of any such Products Purchaser is unable to accept. Upon notice from
Purchaser to Seller that Purchaser is again able to accept such Products, Seller will notify
Purchaser of any commitments for the sale of Products that Seller has entered into and Seller shall
not be required to deliver, or make available, as the case may be, such Products to Purchaser until
Seller has provided all Products contracted by Seller, provided that no such Agreement shall be
entered into for a term longer than one (1) month without the written consent of Purchaser, which
consent shall not be unreasonably withheld, conditioned or delayed. If a Force Majeure event
prevents operation of the Mill or any portion thereof, Purchaser will use its commercially
reasonable efforts, within sixty (60) days of such event or as soon thereafter as reasonably
practicable, to notify Seller of whether Purchaser intends to continue the operations of the Mill
and the anticipated date such operations will begin. In the event Purchaser has not reassigned
some or all of the Products applicable to the Mill to another Delivery Point in accordance
herewith, then, within six (6) months after the shutdown of the Mill or portion

13

 

thereof, either
Purchaser or Seller may terminate this Agreement with respect to the portion of the Products that
has not been reassigned upon thirty (30) days written notice.

     Section 5.3 Change Event. If during the Term a Change Event occurs with respect to any Mill,
Purchaser, at its sole election may either (i) redirect the corresponding Product Reduction to
another Delivery Point subject to a Freight Adjustment as contemplated by Section 5.1(a) hereof, or
(ii) upon ninety (90) days’ prior notice to Seller, terminate its rights under this Agreement
(which termination shall be effective on the later of (x) the occurrence of such Change Event, or
(y) the date ninety (90) days after the delivery of such notice) with respect to all or a portion
of such Product Reduction and Seller and Purchaser shall be released from all liability under this
Agreement with respect to such Product Reduction and the Obligation Floor shall be proportionately
reduced.

     Section 5.4 Payment. Purchaser shall pay Seller within fifteen (15) days after the date of
delivery of Product to the designated Delivery Point.

ARTICLE VI

TERM

     Section 6.1 Term. Unless this Agreement is earlier terminated pursuant to Section 6.3 or Article
IX hereof, this Agreement shall commence on the Effective Date and shall expire at midnight on the
date which is twelve (12) years after the Effective Date (said period, as the same may be extended
pursuant to Section 6.2 below, the “Term”).

     Section 6.2 Extension of Term. Upon the expiration of the initial twelve (12) year Term and upon
the expiration of each successive *** period thereafter (each such successive *** period a “Renewal
Period”), unless either party delivers written notice to the other party, at least *** prior to the
expiration of the
initial twelve (12) year Term or the Renewal Period, as the case may be, of its election not to
renew this Agreement, this Agreement shall renew automatically for an additional Renewal Period.

     Section 6.3 Effect of Termination. Upon the earlier of the expiration of the Term or the
termination of this Agreement pursuant to Article IX, this Agreement will become null and void and
have no further force and effect; provided, however, that the provisions of Articles IX and X
hereof shall survive the expiration or termination of this Agreement and remain in full force and
effect; provided, further that no termination or expiration of this Agreement shall relieve either
party of any obligation accrued prior to the effective date of expiration or termination, or of
any liability for any breach of this Agreement by such party prior to the date of such termination.

ARTICLE VII

REPRESENTATIONS AND WARRANTIES

     Section 7.1 Representations and Warranties of Purchaser. Purchaser represents and warrants to
Seller that the statements contained in this Section 7.1 are correct and complete as of the
Effective Date.

14

 

     (a) Purchaser is a corporation duly incorporated, validly existing and in good standing under
the laws of the State of Delaware. Purchaser has all necessary corporate power and authority to
(i) conduct its business as it is presently being conducted, (ii) execute this Agreement and (iii)
perform its obligations and consummate the transactions contemplated hereby. Purchaser is duly
qualified to do business in the States of Texas and Louisiana and the failure to be qualified to do
business in any other jurisdiction would not, individually or in the aggregate, have a material
adverse effect on the financial condition or results of operations of Purchaser or Purchaser’s
ability to perform its obligations under this Agreement.

     (b) All corporate and other actions or proceedings to be taken by or on the part of Purchaser
to authorize and permit the execution and delivery by Purchaser of this Agreement, the performance
by Purchaser of its obligations hereunder and to consummate the transactions contemplated hereby
have been duly and properly taken. This Agreement has been duly executed and delivered by
Purchaser. Upon execution by Purchaser of this Agreement, assuming the valid authorization,
execution and delivery by Seller of this Agreement, this Agreement shall constitute a legal, valid
and binding obligation of Purchaser that is enforceable against Purchaser in accordance with its
terms.

     (c) The execution and delivery by Purchaser of this Agreement and the consummation by
Purchaser of the transactions contemplated hereby will not result in a breach or violation of, or
default under: (i) any judgment, order, injunction, decree or ruling of any governmental authority
applicable to Purchaser or any of its assets; (ii) to Purchaser’s knowledge (as defined below), any
applicable statute, law, ordinance, rule or regulation; (iii) the terms, conditions or provisions
of Purchaser’s certificate of incorporation, bylaws or any standing resolution of its Board of
Directors; or (iv) any note or other evidence of indebtedness, mortgage,
deed of trust, indenture, or other agreement or instrument to which Purchaser is a party or by
which Purchaser may be bound, except for any such breach, violation or default that would not
materially adversely affect the ability of Purchaser to perform its obligations hereunder.

     (d) There are no approvals, consents, permits or registration requirements with respect to any
applicable governmental authority or any other Person that are or will be necessary for the valid
execution and delivery by the Purchaser of this Agreement or the performance of its obligations
hereunder.

     As used in this Section 7.1, the term “Purchaser’s knowledge” means the actual knowledge,
without inquiry, of Morris Davis or George Vorpahl.

     Section 7.2 Representations and Warranties of Seller. Seller represents and warrants to Purchaser
that the statements contained in this Section 7.2 are correct and complete as of the Effective
Date.

     (a) Seller is a limited liability company duly formed, validly existing and in good standing
under the laws of the State of Delaware. Seller has all necessary power and authority to (i)
conduct its business as it is presently being conducted, (ii) execute this Agreement and (iii)
perform its obligations and consummate the transactions contemplated hereby. Seller is duly
qualified to do business in the States of Texas and Louisiana, and the failure to be qualified to
do

15

 

business in any other jurisdiction would not, individually or in the aggregate, have a material
adverse effect on the financial condition or results of operations of Seller.

     (b) All actions or proceedings to be taken by or on the part of Seller to authorize and permit
the execution and delivery by Seller of this Agreement, the performance by Seller of its
obligations hereunder and to consummate the transactions contemplated hereby have been duly and
properly taken. This Agreement has been duly executed and delivered by Seller. Upon execution by
Seller of this Agreement, assuming the valid authorization, execution and delivery by Purchaser of
this Agreement, this Agreement shall constitute a legal, valid and binding obligation of Seller
that is enforceable against Seller in accordance with its terms.

     (c) The execution and delivery by Seller of this Agreement and the consummation by Seller of
the transactions contemplated hereby will not result in a breach or violation of, or default under:
(i) any judgment, order, injunction, decree, or ruling of any court or governmental authority
applicable to Seller or any of its assets; (ii) to Seller’s knowledge (as defined below), any
statute, law, ordinance, rule or regulation; (iii) the terms, conditions, or provisions of Seller’s
bylaws, charter, or other documents of governance; or (iv) any note or other evidence of
indebtedness, any mortgage, deed of trust or indenture, or any lease or other agreement or
instrument to which Seller is a party or by which Seller may be bound, except for any such breach,
violation or default that would not materially adversely affect the validity or enforceability of
this Agreement or the ability of Seller to perform its obligation hereunder.

     (d) There are no approvals, consents, permits or registration requirements with respect to any
applicable governmental authority or any other Person that are or will be necessary for the valid
execution and delivery by the Seller of this Agreement or the performance of its obligations
hereunder.

     (e) Seller has good and marketable title to the Products free and clear of all Liens, except
for such Liens that would not otherwise materially adversely affect Purchaser’s rights in and to
the Products delivered, or made available, to Purchaser pursuant to this Agreement. Seller shall
pay, or cause to be paid, all severance taxes or other levies upon or incident to the production
and delivery of Products hereunder which will or may constitute a Lien thereon or on any products
manufactured therefrom.

     As used in this Section 7.2, the term “Seller’s knowledge” means the actual knowledge, without
inquiry, of Jerry Brodie.

ARTICLE VIII

SELLER’S MANAGEMENT

     Section 8.1 Seller’s Management. Except as expressly provided otherwise in Section 2.5, Seller
will be responsible for the designation, layout and timing of harvest areas, logging and
transportation to the designated Delivery Point, and all other activities associated with ownership
of the Property. Seller agrees to manage the Property in accordance in all material respects with
applicable state best management practices for forestry and in a manner that meets the minimum
requirements for compliance with SFI Standards, including providing third party certification of

16

 

same, or such other third party certification program as is approved in writing from time to time
by Purchaser. Seller’s contracts with logging professionals that produce and deliver Product under
this Agreement shall require that they (i) maintain logger training and continuing education
requirements in accordance with Sustainable Forestry Initiative State Implementation Committee
standards, or such other third party certification organization standards approved in writing by
Purchaser, and (ii) comply with applicable state best management practices for forestry and all
applicable laws, including, without limitation, any weight restriction laws, ordinances or
regulations, and Seller shall use diligent, good faith efforts to ensure compliance with such
requirements. Following written request by Purchaser, Seller shall collect and provide Purchaser
with tract identification information for all Product delivered in accordance herewith. Seller
shall keep evidence of compliance with the terms of this Section 8.1 during the Term, which should
include copies of education certificates and any other appropriate evidence of compliance. Seller
will act in good faith and use its commercially reasonable efforts to cause all Products to meet
the applicable Specifications.

ARTICLE IX

DEFAULT AND DISPUTE RESOLUTION

     Section 9.1 Default by Purchaser. The following events shall constitute events of default by the
Purchaser (each a “Purchaser Event of Default”):

     (a) Purchaser fails to pay as and when due any amount payable by it under this Agreement, and
any such failure remains uncured fifteen (15) days after written notice thereof has been delivered
to Purchaser;

     (b) Purchaser fails to perform or observe any other term, covenant or agreement contained in
this Agreement on its part to be performed or observed, and any such failure remains uncured for
thirty (30) days after written notice thereof has been delivered to Purchaser; or

     (c) Any representation or warranty of Purchaser under this Agreement is incorrect in any
material respect.

If any Purchaser Event of Default occurs and continues fifteen (15) days after such initial written
notice thereof has been given to Purchaser, then Seller may, by written notice to Purchaser, in
addition to Seller’s other remedies available herein in equity, at law, or otherwise, suspend
delivery of Product otherwise deliverable to Purchaser pursuant to the terms of this Agreement, and
deliver such Product to an alternate third-party purchaser at a price reasonably consistent with
then-existing market conditions (such Product counting toward the applicable Obligated Volume);
provided that Purchaser shall be liable in the event of such delivery to an alternate purchaser for
the difference between the applicable Quarterly Price for such Product and the price actually paid
to Seller by such alternate third-party purchaser for such Product. If any Purchaser Event of
Default occurs and continues fifteen (15) days after a second written notice thereof has been given
to Purchaser upon or after expiration of the initial 15-day cure period, then Seller may, by
written notice to Purchaser, in addition to Seller’s other remedies available

17

 

herein, in equity, at
law, or otherwise, (i) terminate this Agreement, or (ii) pursue specific performance of this
Agreement.

     Section 9.2 Default by Seller. The following events shall constitute events of default by the
Seller (each a “Seller Event of Default”):

     (a) Seller fails to pay as and when due any amount payable by it under this Agreement, and any
such failure remains uncured fifteen (15) days after written notice thereof has been delivered to
Seller;

     (b) Seller fails to perform or observe any other term, covenant or agreement contained in this
Agreement on its part to be performed or observed, and any such failure remains uncured thirty (30)
days after written notice thereof has been delivered to Seller;

     (c) Any representation or warranty of Seller under this Agreement is incorrect in any material
respect;

     (d) Seller fails to deliver in any calendar quarter at least ninety percent (90%) of the
applicable quarterly volume in the Delivery Plan; or

     (e) Seller fails to deliver at least ninety percent (90%) of the Obligated Volume in any
Harvest Year.

If any Seller Event of Default occurs and continues fifteen (15) days after such initial written
notice thereof has been given to Seller, then Purchaser may, by written notice to Seller, in
addition to Purchaser’s other remedies available herein in equity, at law, or otherwise, suspend
acceptance of Product otherwise deliverable to Purchaser pursuant to the terms of this Agreement,
and accept such Product from an alternate third-party supplier at a price reasonably consistent
with then-existing market conditions (such Product counting toward the applicable Obligated
Volume); provided that Seller shall be liable in the event of such acceptance from an alternate
supplier for the difference between the applicable Quarterly Price for such Product and the price
actually paid by Purchaser to such alternate third-party supplier for such Product. If any Seller
Event of Default occurs and continues fifteen (15) days after a second written notice thereof has
been given to Seller upon or after expiration of the initial 15-day cure period, then Purchaser
may, by written notice to Seller, in addition to Purchaser’s other remedies available herein, in
equity, at law, or otherwise, (i) terminate this Agreement, or (ii) pursue specific performance of
this Agreement.

     Section 9.3 Specific Performance. With respect to Purchaser’s and Seller’s rights to seek specific
performance pursuant to Sections 9.1 and 9.2, each party acknowledges and agrees that the other
party would be damaged irreparably in the event any of the provisions of this Agreement are not
performed in accordance with their specific terms or otherwise are breached. Accordingly, each of
the parties agrees that the other party shall be entitled to an injunction or injunctions to
prevent breaches of the terms of this Agreement and to enforce specifically this Agreement and the
terms and provisions hereof in any action instituted in any court of the United States or any state
thereof having jurisdiction over the parties and the matter, in addition to any other remedy to
which they may be entitled hereunder.

18

 

     Section 9.4 Liquidated Damages. Without limiting the rights and remedies set forth in Section 9.2
and Section 9.3, in the event of a Seller Event of Default due to Seller’s failure or inability,
for any reason other than Force Majeure, to timely deliver the specified mix of volumes of Products
as required under this Agreement, then Purchaser may elect, in addition to any other rights
Purchaser may have under Section 9.2 and Section 9.3, to require Seller to pay to Purchaser, as
liquidated damages and not as a penalty, an amount equal to the difference between any cover price
paid by Purchaser and the unpaid price under this Agreement plus *** of such
amount. If Seller fails or refuses to pay such amount to Purchaser within ten (10) days after
Purchaser’s request therefor, Purchaser shall have the right to offset such amount against amounts
next due and owing to Seller by Purchaser hereunder. In the event of a Seller Event of Default,
each party hereby waives the right to recover incidental, consequential or punitive damages from
the other party hereto.

     Section 9.5 Assignment of Agreement. In the event of a Seller Event of Default that remains
uncured fifteen (15) days after the second written notice given pursuant to Section 9.2, Seller
shall, not later than five (5) days after receiving a written request from Purchaser, assign to
Purchaser all of Seller’s rights, interests and obligations in and under the Master Stumpage
Agreement and Purchaser shall assume all obligations thereunder from and after the date of such
assignment, provided, however, that Seller shall remain responsible (and Purchaser shall not
be responsible) for any obligations of Seller thereunder arising prior to such assignment.
Notwithstanding the foregoing, Purchaser may, at Purchaser’s option, elect to pay any outstanding
invoices payable by Seller under the Master Stumpage Agreement, in which event Purchaser shall have
recourse against Seller for any amounts so paid, including, without limitation, the right to offset
any such amounts against amounts payable by Purchaser to Seller hereunder.

     Section 9.6 Dispute Resolution. In the event of any dispute, claim, question or
disagreement arising from or relating to this Agreement or the breach thereof, each party shall use
its commercially reasonable efforts to settle the dispute, claim, question or disagreement. To
this effect, upon written notice from either party to the other party requesting that discussions
be initiated (a “Dispute Notice”), Purchaser and Seller shall consult and negotiate with each other
in good faith and, recognizing their mutual interests, attempt to reach a just and equitable
solution satisfactory to the parties. If Purchaser and Seller do not reach such a solution within
a period of fifteen (15) days after delivery of such Dispute Notice, the parties shall have all
rights and remedies set forth in this Agreement or otherwise available under applicable law. If
the parties mutually agree to arbitrate a dispute, then the applicable dispute, claim or
controversy shall be submitted to resolution in the following manner:

     (i) Arbitration shall be according to the rules of the AAA (but not administered by
AAA), except as herein modified by the parties or otherwise as agreed to by the parties.

     (ii) Within ten (10) days of the agreement of the parties to arbitrate, each party will
select an arbitrator, notify the other party of its selection and submit to the other party
and its selected arbitrator its position regarding such claim, dispute or controversy.
Within ten (10) days after such notice, the respective arbitrators will select a third
arbitrator as the chairman of the panel (the “Panel Chairman”). The arbitrators

19

 

     selected by Purchaser and Seller, together with the Panel Chairman, shall be, collectively, referred to
herein as the “Panel.”

     (iii) All arbitrators on the Panel shall have experience in the business of producing,
procuring and selling forest products in the Southern region of the United States.
Furthermore, the Panel Chairman shall be a forestry professional with at least ten (10)
years of experience in Southern timber harvesting practices who has not performed any work
as an employee or consultant for either party during the previous five (5) years, unless
otherwise agreed upon by Purchaser and Seller.

     (iv) A majority decision of the Panel and resolution must be reached within fifteen
(15) days after the selection of the Panel Chairman. Decisions of the panel must be in
writing and will be final and binding upon the parties, and judgment may be entered thereon
by any court having jurisdiction.

     (b) Notwithstanding anything to the contrary contained in Section 9.6(a), above, Seller and
Purchaser agree to submit any dispute as to Base Price, Quarterly Price, Final Quarterly Price,
Freight Adjustment or any other dispute with respect to price (a “Price Dispute”) to binding
arbitration to be resolved by a Panel selected in accordance with the provisions of Section
9.6(a)(ii) above, which Panel shall act in accordance with the following procedure:

	 	(i)	 	Within fifteen (15) days after the selection of the Panel, each
party will submit in writing to the Panel its position with respect to the
price or cost in dispute and any materials such party wishes to submit
supporting the use of the proposed purchase and sale price.
	 
	 	(ii)	 	Within fifteen (15) days following the submission of the
position of each party, the Panel will choose one of the two submitted
positions (and no other) based upon the Panel’s determination of the position
that better reflects the actual market price or cost at issue. If only one
position is submitted, the Panel will choose such position.
	 
	 	(iii)	 	The Panel shall assess the costs of such arbitration and
reasonable attorney fees against the party whose position was not chosen or who
did not submit a position.

During the arbitration proceedings of any Price Dispute, the Price for the purchase and sale of
such Product for the calendar quarter in question shall be the average of the two submitted prices
and Seller shall continue to deliver Product and Purchaser shall continue to accept Product as
otherwise required by this Agreement. Upon the resolution of such Price Dispute, Purchaser and
Seller agree to adjust the Price for any Product sold by Seller and purchased by Purchaser during
such arbitration proceeding to reflect the Price as determined by the Panel and promptly reimburse
each other accordingly to effect such adjustment.

     (c) Except as provided in Section 9.6(b), above, each party shall bear its own cost of
presenting its case, and one-half of the cost incurred by the Panel.

20

 

     (d) The parties and the Panel shall treat the proceedings, any resolution thereof and any
related discovery as confidential, except in connection with a judicial challenge to, or
enforcement of, an award and unless otherwise required by law.

ARTICLE X

INDEMNITY AND INSURANCE

     Section 10.1 Purchaser’s Indemnity. Purchaser shall defend, indemnify and hold harmless the
Seller, its Affiliates and their assignees, subcontractors, members, shareholders, directors,
officers, managers, partners, employees, agents and consultants (each, a “Seller Indemnitee”), from
and against all claims and causes of action, pending or threatened, of any kind or nature, by third
parties, related to or arising out of any bodily injury to, or death of, any Person, or any
physical damage to tangible property, resulting
from, or attributable to, Purchaser’s breach of this Agreement or the negligent or intentional
wrongful acts or omissions of Purchaser, its Affiliates or any of their employees, agents or
contractors; except to the extent such injury or damage also results in part from the negligent or
intentionally wrongful act or omission of any Seller Indemnitee. Notwithstanding anything herein
to the contrary, Purchaser shall indemnify any Seller Indemnitee for any incidental, consequential
or punitive damages that such Seller Indemnitee is required to pay to any third party as a result
of such breach, act or omission of Purchaser, its Affiliates or any of their employees, agents or
contractors.

     Section 10.2 Seller’s Indemnity. Seller shall defend, indemnify and hold harmless the Purchaser,
its Affiliates and their assignees, subcontractors, members, shareholders, directors, officers,
managers, partners, employees, agents and consultants (each, a “Purchaser Indemnitee”), from and
against all claims and causes of action, pending or threatened, of any kind or nature, by third
parties, related to or arising out of any bodily injury to, or death of, any Person, or any
physical damage to tangible property, resulting from, or attributable to, Seller’s breach of this
Agreement or the negligent or intentional wrongful acts or omissions of Seller, its Affiliates or
any of their employees, agents or contractors; except to the extent such injury or damage also
results in part from the negligent or intentionally wrongful act or omission of any Purchaser
Indemnitee. Notwithstanding anything herein to the contrary, Seller shall indemnify any Purchaser
Indemnitee for any incidental, consequential or punitive damages that such Purchaser Indemnitee is
required to pay to any third party as a result of such breach, act or omission of Seller, its
Affiliates or any of their employees, agents or contractors.

     Section 10.3 Insurance. Each party, and any contractors engaged by or on behalf of such party,
will keep in effect during the Term, at its sole expense, the following insurance coverages:

     (a) Comprehensive general liability insurance with limits not less than $2,000,000 for bodily
injury to one person, $2,000,000 for bodily injury to any group of persons as a result of one
occurrence, and $2,000,000 for property damage; provided, however each party’s contractors’
policies shall provide coverage for general liability with limits not less than $1,000,000 per
occurrence bodily injury liability and property damage liability combined and $1,000,000 in the
aggregate;

21

 

     (b) Commercial Auto Liability insurance with limits not less than $1,000,000 combined single
limits insuring “Any Auto” or “All Owned Autos,” “Hired Autos” and “Non-owned Autos;”

     (c) Employer’s Liability Insurance with limits not less than the following:

	 	(i)	 	Each accident — $100,000,
	 
	 	(ii)	 	Disease (policy) — $500,000, and
	 
	 	(iii)	 	Disease (each employee) — $100,000; and

     (d) Worker’s compensation insurance, covering all employees, including owners, partners and
executive officers, with limits no less than the statutory limits of the state where the work is
being performed. Each party’s worker’s compensation policy shall be endorsed to waive all rights
of subrogation against the other party and all subsidiaries thereof where permitted by law, and
policies shall include excess and stop-gap worker’s compensation coverage for all contractors and
subcontractors of the insured party.

     Such policies will name the other party as an additional insured by endorsements to the
policies, as if the additional insureds were the named insured, without restrictions. Each party
shall provide the other party with Certificates of Insurance throughout the term of this Agreement,
as requested.

     Notwithstanding the provisions of Article IX, Purchaser shall have the right to withhold any
and all payments for Products or services provided hereunder if Seller does not procure insurance
coverage, allows coverage required hereunder to lapse or be cancelled, or does not provide evidence
of required insurance in accordance herewith.

     Either party may, at such party’s option and upon no less than ninety (90) days advance
written notice to the other party, amend the coverages and policy limits set forth in this Section
10.3 without the consent of the other party, provided that such new coverages and policy limits
shall be substantially similar to the coverage requirements imposed generally in the commercial
forestry industry in the Southern region of the United States.

     Section 10.4 Notice of Claim. Purchaser and Seller shall immediately give the other party written
notice of any alleged claim by a third party arising out of this Agreement or the actions or
activities contemplated by this Agreement.

ARTICLE XI

ASSIGNMENT AND TRANSFERS

     Section 11.1 Seller’s Assignment Rights. Any proposed assignment by Seller of its rights and
obligations under this Agreement that is subject to Sections 3.3(b) and 3.3(c) of the Support
Agreement shall be governed by such provisions. Otherwise, Seller may assign its rights and
obligations under this Agreement only to an assignee with the financial and

22

 

operational capability
to fulfill the obligations of Seller hereunder and otherwise satisfactory to Purchaser as
determined in its reasonable discretion.

     Section 11.2 Purchaser’s Assignment Rights. Purchaser shall have the right to assign its
rights and obligations under this Agreement, in whole or in part, without the prior consent of
Seller.

ARTICLE XII

AUDIT RIGHTS

     Section 12.1 Audit Rights. Either party shall have the right to audit the other party’s compliance
with the terms of this Agreement, including the terms of Articles 2, 3, 4 and 5 by notifying the
party to be audited of the requesting party’s exercise of such right within six (6) months after
the end of the Harvest Year for which the requesting party intends to exercise such right. The
audited party shall provide the requesting party or its representative with access during normal
business hours to all records and other information necessary to complete such audit as are
commercially reasonable. Furthermore, the requesting party shall have the right to access the
Property or the Mill, as the case may be, and to inspect any and all deliveries of Product for
purposes of monitoring the performance of the audited party’s obligations pursuant to the terms
herein, including the right to audit. All nonpublic information acquired in the course of either
party’s exercise of the audit rights provided for by this Section 12.1 shall be subject to the
provisions of Section 14.4.

ARTICLE XIII

NOTICES

     Section 13.1 Notices. All notices required or permitted to be given hereunder shall be in writing,
signed by the party giving such notice or its legal counsel, and shall be deemed to be delivered,
whether or not actually received, (i) when personally delivered by commercial courier service or
other messenger; (ii) three (3) days after being deposited with the United States Postal Service
with postage paid for certified delivery with return receipt requested; (iii) when sent by next day
business commercial service delivery, or (iv) when transmitted by e-mail evidenced by a
confirmatory response e-mail or by facsimile evidenced by a confirmed receipt, with a copy sent by
any of the means permitted by clauses (i), (ii) or (iii) above on the same day the e-mail or
facsimile transmission is sent by the party giving such notice. For purposes of notice, the
addresses of the parties are as follows:

	 	 	 	 	 
	 

	 	Purchaser:
	 	TIN Inc.
	 

	 	 	 	303 South Temple Drive
	 

	 	 	 	Diboll, Texas 75941
	 

	 	 	 	Attention: Group Vice President
	 

	 	 	 	                 Building Products
	 

	 	 	 	Facsimile: (936) 829-1248

23

 

	 	 	 	 	 
	 

	 	
	 	E-mail: JackSweeny@templeinland.com
	 
	 	 	 	 
	 

	 	Copy to:
	 	Temple-Inland Inc.
	 

	 	 	 	1300 S. Mopac Expressway
	 

	 	 	 	Austin, Texas 78746
	 

	 	 	 	Attention: General Counsel
	 

	 	 	 	Facsimile: (512) 434-8051
	 

	 	 	 	E-mail: GeorgeVorpahl@templeinland.com
	 
	 	 	 	 
	 

	 	Seller:
	 	CPT LogCo, LLC
	 

	 	 	 	c/o The Campbell Group
	 

	 	 	 	1 SW Columbia, Suite 1700
	 

	 	 	 	Portland, Oregon 97258
	 

	 	 	 	Attention: Jerry Brodie
	 

	 	 	 	Facsimile: (503) 275-9667
	 

	 	 	 	E-mail: JBrodie@campbellgroup.com
	 
	 	 	 	 
	 

	 	Copy to:
	 	Schwabe, Williamson & Wyatt
	 

	 	 	 	1211 SW Fifth Avenue, Suite 1800
	 

	 	 	 	Portland, Oregon 97204
	 

	 	 	 	Attention: Kirk Johansen
	 

	 	 	 	Facsimile: (503) 796-2900
	 

	 	 	 	E-mail: kjohansen@schwabe.com

or to such other address or addresses as any party may from time to time, upon five (5) business
days’ advance written notice to the other party, designate as to itself.

ARTICLE XIV

MISCELLANEOUS

     Section 14.1 Amendments. No amendment or waiver of any provision of this Agreement will in any
event be effective unless the same shall be in writing and signed by both parties. This Agreement
constitutes the full and complete understanding of the parties with respect to the subject matter
hereof and supersedes all prior and contemporaneous agreements and understandings, both oral and
written, between the parties with respect thereto.

     Section 14.2 Recording of Agreement. Seller and Purchaser shall cause to be recorded a Memorandum
of Agreement against the Property at the appropriate public records office(s) in the
jurisdiction(s) in which the Property is located giving notice of the rights of Purchaser under
this Agreement. Purchaser agrees to execute and deliver, within thirty (30) days following
Seller’s request therefor, appropriate recordable documents reasonably necessary to evidence the
release of any portion of the Property that is conveyed or otherwise transferred by Seller pursuant
to the terms of this
Agreement, and Purchaser consents to the recording of such documents in the appropriate public
records office.

24

 

     Section 14.3 Compliance with Laws. Each party agrees that its performance of this Agreement shall
comply with all applicable federal, state and local laws, rules and regulations, including, without
limitation, all Environmental Laws, and that each party shall obtain and maintain in effect all
necessary licenses and permits incident to its operations in the performance of this Agreement.

     Section 14.4 Confidentiality. To the fullest extent permitted under applicable law, the parties
hereto shall keep the nonpublic terms, conditions and provisions of this Agreement confidential;
provided, however, the parties may release information as required by applicable law, and to their
respective lenders, partners, employees, consultants and contractors so long as any such party is
made aware of the provisions of this Section 14.4.

     Section 14.5 Estoppel Certificates. Both parties agree that within twenty (20) days of the other
party’s request for the same, the providing party shall deliver to the requesting party an estoppel
certificate in form reasonably satisfactory to the requesting party setting forth (to the extent
the providing party may truthfully certify to the same), among other things, that this Agreement is
in full force and effect, that, to its knowledge, no breach exists on behalf of the requesting
party hereunder, and the portion of the Obligated Volume harvested by Purchaser as of such date.

     Section 14.6 No Waiver; Remedies.No failure on the part of either party to exercise, and no delay
in exercising, any right under this Agreement will operate as a waiver thereof; nor will any single
or partial exercise of any right under this Agreement preclude any other or further exercise
thereof or the exercise of any other right.

     Section 14.7 Accounting Terms. All accounting terms not specifically defined herein will be
construed in accordance with United States generally accepted accounting principles consistently
applied, except as otherwise stated herein.

     Section 14.8 Binding Effect; Governing Law. This Agreement will be binding upon and inure to the
benefit of Purchaser and Seller and their respective successors and permitted assigns. This
Agreement will be governed by, and construed in accordance with, the laws of the State of Texas,
without giving effect to the conflicts of law principles thereof.

     Section 14.9 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall
constitute one and the same instrument, and any of the parties may execute this Agreement by
signing any such counterpart.

     Section 14.10 Time of the Essence. Time is of the essence of this Agreement.

     Section 14.11 Incorporation of Exhibits and Schedules. All exhibits and schedules referred to in
this Agreement are hereby incorporated herein by this reference.

     Section 14.12 Interest. At the election of the payee, any amount not paid when due hereunder, and
which remains unpaid for a period of fifteen (15) days or more after written notice of such
non-payment to the Person obligated to make such payment, will bear interest at the rate of five
percent (5%) above the prime rate, as published in the “Money Rates” table of the Wall Street
Journal from time to time, whichever is greater, from the date due until paid;

25

 

provided, that in no
event shall the interest rate exceed the maximum lawful rate allowed under applicable law.

     Section 14.13 Further Assurances. Seller and Purchaser further covenant to cooperate with one
another in all reasonable respects necessary to consummate and give effect to the transactions
contemplated by this Agreement (including executing and delivering such instruments or other
writings as the other party may reasonably request), and each will take all reasonable actions
within its authority to secure cooperation of any necessary third parties.

     Section 14.14 Most Favored Status. During the Term, each party to this Agreement shall treat the
other on the most favorable basis compared to its other suppliers or purchasers with respect to its
sales, purchases and deliveries hereunder or any other matters in the customary operation of its
business. Without limiting the generality of the foregoing sentence, during the occurrence of
adverse weather conditions or an adverse change in the market that do not amount to a Force Majeure
event, (a) Purchaser shall not, to the extent commercially practicable, reduce the volume of
Product required to be purchased under this Agreement until such time as Purchaser has ceased
acceptance of delivery of similar wood products purchased from other suppliers that are not
Affiliates of Seller and (b) Seller shall, to the extent commercially practicable, deliver all
Product harvested from the Property to Purchaser, and to no other Person, until such time as the
volume requirements for the applicable Delivery Plan have been met.

     Section 14.15 Attorney’s Fees. Except as expressly provided otherwise in Section 9.6, if
arbitration, mediation, litigation or any other proceeding of any nature whatsoever (including any
proceeding under the U.S. Bankruptcy
Code) is instituted or appealed in connection with any controversy arising out of this Agreement or
to interpret or enforce any rights, the prevailing party shall be entitled to recover its
attorneys’, paralegals’, accountants’, and other experts’ fees and all other fees, costs, and
expenses actually incurred, as determined to be reasonable by the arbitrator(s) or court(s), in
addition to all other amounts provided by law. The prevailing party will be deemed to be the party
to have won on the issues with the greatest value as determined by the court(s) or arbitrator(s).

     Section 14.16 Severability. Whenever possible, each provision in this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provisions or the remaining provisions of this Agreement.

     Section 14.17 Captions and Headings. The captions and headings used in this Agreement are for
convenience and reference only and do not constitute a part of this Agreement and shall not be
deemed to limit, characterize or in any way affect any provision of this Agreement, and all
provisions of this Agreement shall be enforced and construed as if no caption or heading had been
used in this Agreement.

     Section 14.18 Construction. The parties agree that “including” and other words or phrases of
inclusion, if any, shall not be construed as terms of limitation, so that references to “included”
matters shall be regarded as nonexclusive, non-characterizing illustrations and equivalent to the
terms “including, but not limited to,” and “including, without limitation.” Each

26

 

party
acknowledges that it has had the opportunity to be advised and represented by counsel in the
negotiation, execution and delivery of this Agreement and accordingly agrees that if any ambiguity
exists with respect to any provision of this Agreement, such provision shall not be construed
against any party solely because such party or its representatives were the drafters of any such
provision.

     Section 14.19 Relationship. The only relationship between Seller and Purchaser shall be that of
vendor and purchaser of the Product to be cut and removed from the Property, and neither party
shall in any respect be deemed to be or represent itself to be an agent of the other party.
Furthermore, no relationship of employer-employee or master and servant is intended, nor shall it
be construed, to exist between the parties, or between any party and any servant, agent, employee
and/or supplier of any other party, by reason of this Agreement. Each party shall select and pay
its own servants, agents, employees and/or suppliers and neither party nor its servants, agents,
employees, or suppliers shall be subject to any orders, supervision or control of the other party.

     Section 14.20 Integration. This Agreement constitutes the entire agreement of the parties
hereto with respect to the subject matter contained herein.

     Section 14.21 Uniform Commercial Code. This Agreement is subject to Section 1.304 of the
Business and Commerce Code of Texas.

[Signature Pages Follow]

27

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed, sealed and
delivered by their respective officers thereunto duly authorized, as of the date first above
written.

	 	 	 	 	 
	 	 	PURCHASER
	 
	 	 	 	 
	 	 	TIN INC., a Delaware corporation
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 

[Seller Signature Page Follows]

28

 

	 	 	 	 	 	 	 
	 	 	SELLER:	 	 
	 
	 	 	 	 	 	 
	 	 	CPT LOGCO, LLC, a Delaware limited liability
company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:
	 	Stanley G. Renecker	 	 
	 

	 	Title:
	 	Authorized Signatory	 	 

29

 

SCHEDULE 1

SPECIFICATIONS

TEMPLE-INLAND

BUNA LUMBER OPERATION

PURCHASED DELIVERED MEDIUM TREE LENGTH LOG SPECIFICATIONS (PSTM)

June 22, 2007

			
	1)	 	Length: ***
	 
	2)	 	Butt Size: ***
	 
	3)	 	Top Size: ***
	 
	4)	 	Minimum Age: All stems must be ***
	 
	5)	 	Knots: ***
	 
	6)	 	Redheart: ***
	 
	7)	 	Catface/ cronartium: ***
	 
	8)	 	Crook/fork: ***
	 
	9)	 	Sweep: ***
	 
	10)	 	Butt spur/slant: ***
	 
	11)	 	Foreign material: ***
	 
	12)	 	Dead log/ bug log: ***
	 
	13)	 	Charred/ Burned logs: ***
	 
	14)	 	General Quality: ***
	 
	15)	 	Culling: ***
	 
	16)	 	Receiving: ***

Schedule 1

 

TEMPLE-INLAND

BUNA LUMBER OPERATION

PURCHASED DELIVERED SMALL TREE LENGTH LOG SPECIFICATIONS (PSTS)

June 22, 2007

			
	1)	 	Composition: ***
	 
	2)	 	Length: ***
	 
	3)	 	Butt Size: ***
	 
	4)	 	Top Size: ***.
	 
	5)	 	Minimum Age: All stems must be ***
	 
	6)	 	Knots: ***
	 
	7)	 	Redheart: ***
	 
	8)	 	Catface/cronartium: ***
	 
	9)	 	Crook/fork: ***
	 
	10)	 	Sweep: ***
	 
	11)	 	Butt spur/Slant: ***
	 
	12)	 	Foreign Material: ***
	 
	13)	 	Dead log/ bug log: ***
	 
	14)	 	Charred/Burned logs: ***
	 
	15)	 	General Quality: ***
	 
	16)	 	Culling: ***
	 
	17)	 	Receiving: ***

 

 

TEMPLE-INLAND

BUNA LUMBER OPERATION

PURCHASED DELIVERED LARGE TREE LENGTH LOG SPECIFICATIONS (PSTL)

June 22, 2007

			
	1)	 	Length: ***
	 
	2)	 	Butt Size: ***
	 
	3)	 	Top Size: ***
	 
	4)	 	Minimum Age: All stems must be ***
	 
	5)	 	Knots: ***
	 
	6)	 	Redheart: ***
	 
	7)	 	Catface/cronartium: ***
	 
	8)	 	Crook/fork: ***
	 
	9)	 	Sweep: ***
	 
	10)	 	Butt spur/slant: ***
	 
	11)	 	Foreign material: ***
	 
	12)	 	Dead log/bug log: ***
	 
	13)	 	Charred/Burned logs: ***
	 
	14)	 	General Quality: ***
	 
	15)	 	Culling: ***
	 
	16)	 	Receiving: ***

 

 

TEMPLE-INLAND

DIBOLL LUMBER OPERATION

PURCHASED DELIVERED MEDIUM TREE LENGTH LOG SPECIFICATIONS (PSTM)

June 22, 2007

			
	1)	 	Length: ***
	 
	2)	 	Butt Size: ***
	 
	3)	 	Top Size: ***
	 
	4)	 	Minimum Age: All stems must be ***
	 
	5)	 	Knots: ***
	 
	6)	 	Redheart: ***
	 
	7)	 	Catface/cronartium: ***
	 
	8)	 	Crook/fork: ***
	 
	9)	 	Sweep: ***
	 
	10)	 	Butt spur/slant: ***
	 
	11)	 	Foreign material: ***
	 
	12)	 	Dead log/ bug log: ***
	 
	13)	 	Charred/ Burned logs: ***
	 
	14)	 	General Quality: ***
	 
	15)	 	Culling: ***
	 
	16)	 	Receiving: ***

 

 

TEMPLE-INLAND

DIBOLL LUMBER OPERATION

PURCHASED DELIVERED SMALL TREE LENGTH LOG SPECIFICATIONS (PSTS)

June 22, 2007

			
	1)	 	Composition: ***
	 
	2)	 	Length: ***
	 
	3)	 	Butt Size: ***
	 
	4)	 	Top Size: ***
	 
	5)	 	Minimum Age: All stems must be ***
	 
	6)	 	Knots: ***
	 
	7)	 	Redheart: ***
	 
	8)	 	Catface/cronartium: ***
	 
	9)	 	Crook/fork: ***
	 
	10)	 	Sweep: ***
	 
	11)	 	Butt spur/slant: ***
	 
	12)	 	Foreign material: ***
	 
	13)	 	Dead log/ bug log: ***
	 
	14)	 	Charred/Burned logs: ***
	 
	15)	 	General Quality: ***
	 
	16)	 	Culling: ***
	 
	17)	 	Receiving: ***

 

 

TEMPLE — INLAND

PINELAND SAWMILL AND STUDMILL

PURCHASE DELIVERED CHIP-N-SAW SPECIFICATIONS (PSCS)

June 22, 2007

			
	1)	 	Length: ***
	 
	2)	 	Butt size: ***
	 
	3)	 	Top size: ***
	 
	4)	 	Minimum Age: All stems must be ***
	 
	5)	 	Knots: ***.
	 
	6)	 	Redheart: ***
	 
	7)	 	Catface/ cronartium: ***
	 
	8)	 	Crook/fork: ***
	 
	9)	 	Sweep: ***
	 
	10)	 	Butt spur/ slant: ***
	 
	11)	 	Foreign material: ***
	 
	12)	 	Dead log/ bug log: ***
	 
	13)	 	Charred/ Burned Logs: ***
	 
	14)	 	General Quality: ***
	 
	15)	 	Culling: ***
	 
	16)	 	Receiving: ***

 

 

TEMPLE-INLAND

PINELAND LUMBER OPERATION

PURCHASED DELIVERED MEDIUM TREE LENGTH LOG SPECIFICATIONS (PSTM)

June 22, 2007

			
	1)	 	Length: ***
	 
	2)	 	Butt Size: ***
	 
	3)	 	Top Size: ***
	 
	4)	 	Minimum Age: All stems must be ***
	 
	5)	 	Knots: ***
	 
	6)	 	Redheart: ***
	 
	7)	 	Catface/ cronartium: ***
	 
	8)	 	Crook/fork: ***
	 
	9)	 	Sweep: ***
	 
	10)	 	Butt spur/slant: ***
	 
	11)	 	Foreign material: ***
	 
	12)	 	Dead log/ bug log: ***
	 
	13)	 	Charred/ Burned logs: ***
	 
	14)	 	General Quality: ***
	 
	15)	 	Culling: ***
	 
	16)	 	Receiving: ***

 

 

TEMPLE-INLAND

PINELAND SAWMILL

PURCHASED DELIVERED SMALL TREE LENGTH LOG SPECIFICATIONS (PSTS)

June 22, 2007

			
	1)	 	Composition: ***
	 
	2)	 	Length: ***
	 
	3)	 	Butt Size: ***
	 
	4)	 	Top Size: ***
	 
	5)	 	Minimum Age: All stems must be ***
	 
	6)	 	Knots: ***
	 
	7)	 	Redheart: ***
	 
	8)	 	Catface/cronartium: ***
	 
	9)	 	Crook/fork: ***
	 
	10)	 	Sweep: ***
	 
	11)	 	Butt spur/slant: ***
	 
	12)	 	Foreign Material: ***
	 
	13)	 	Dead log/ bug log: ***
	 
	14)	 	Charred/Burned logs: ***
	 
	15)	 	General Quality: ***
	 
	16)	 	Culling: ***
	 
	17)	 	Receiving: ***

 

 

TEMPLE-INLAND

SWLA LUMBER OPERATION

PURCHASED DELIVERED LARGE TREE LENGTH LOG SPECIFICATIONS (PSTL)

June 22, 2007

			
	1)	 	Length: ***
	 
	2)	 	Butt Size: ***
	 
	3)	 	Top Size: ***
	 
	4)	 	Minimum Age: All stems must be ***
	 
	5)	 	Knots: ***
	 
	6)	 	Redheart: ***
	 
	7)	 	Catface/cronartium: ***
	 
	8)	 	Crook/fork: ***
	 
	9)	 	Sweep: ***
	 
	10)	 	Butt spur/slant: ***
	 
	11)	 	Foreign material: ***
	 
	12)	 	Dead log/bug log: ***
	 
	13)	 	Charred/Burned logs: ***
	 
	14)	 	General Quality: ***
	 
	15)	 	Culling: ***
	 
	16)	 	Receiving: ***

 

 

TEMPLE-INLAND

SWLA LUMBER OPERATION

PURCHASED DELIVERED MEDIUM TREE LENGTH LOG SPECIFICATIONS (PSTM)

June 22, 2007

			
	1)	 	Length: ***
	 
	2)	 	Butt Size: ***
	 
	3)	 	Top Size: ***
	 
	4)	 	Minimum Age: All stems must be ***
	 
	5)	 	Knots: ***
	 
	6)	 	Redheart: ***
	 
	7)	 	Catface/ cronartium: ***
	 
	8)	 	Crook/fork: ***
	 
	9)	 	Sweep: ***
	 
	10)	 	Butt spur/slant: ***
	 
	11)	 	Foreign material: ***
	 
	12)	 	Dead log/ bug log: ***
	 
	13)	 	Charred/ Burned logs: ***
	 
	14)	 	General Quality: ***
	 
	15)	 	Culling: ***
	 
	16)	 	Receiving: ***

 

 

TEMPLE-INLAND

SWLA LUMBER OPERATION

PURCHASED DELIVERED SMALL TREE LENGTH LOG SPECIFICATIONS (PSTS)

June 22, 2007

			
	1)	 	Composition: ***
	 
	2)	 	Length: ***
	 
	3)	 	Butt Size: ***
	 
	4)	 	Top Size: ***
	 
	5)	 	Minimum Age: All stems must be ***
	 
	6)	 	Knots: ***
	 
	7)	 	Redheart: ***
	 
	8)	 	Catface/cronartium: ***
	 
	9)	 	Crook/fork: ***
	 
	10)	 	Sweep: ***
	 
	11)	 	Butt spur/slant: ***
	 
	12)	 	Foreign material: ***
	 
	13)	 	Dead log/ bug log: ***
	 
	14)	 	Charred/Burned logs: ***
	 
	15)	 	General Quality: ***
	 
	16)	 	Culling: ***
	 
	17)	 	Receiving: ***

 

 

SCHEDULE 2

2008 ANNUAL PLAN

	 	 	 	 	 	 	 	 	 	 	 
	Compstand
	 	Est. Year
	 	County
	 	Technique
	 	Harvest Acres
	 	Total PP
	***
	 	***
	 	***
	 	***
	 	***
	 	***

Schedule 2

 

SCHEDULE 3

2008 FORECAST PLAN

2009 Pine Sawtimber Forecast

	 	 	 	 	 	 	 
	 	 	Product	 	Tons	 
	 
	BUNA AREA
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSMP	 	 	*	**
	 	 	 	 	 
	 
	 	 	 	 	*	**
	 
	 	 	 	 	 	 
	DIBOLL AREA
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSMP	 	 	*	**
	 	 	 	 	 
	 
	 	 	 	 	*	**
	 
	 	 	 	 	 	 
	PINELAND AREA
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSMP	 	 	*	**
	 	 	 	 	 
	 
	 	 	 	 	*	**
	 
	 	 	 	 	 	 
	DEQUINCY AREA
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSMP	 	 	*	**
	 	 	 	 	 
	 
	 	 	 	 	*	**

Schedule 3

 

	 	 	 	 	 	 	 
	 	 	Product	 	Tons	 
	 
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSCS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTS ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTM ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSTL ***	 	 	*	**
	 
	 	Sum of PSMP	 	 	*	**
	 	 	 	 	 
	 
	 	Total	 	 	*	**
	 
	 	 	 	 	 	 
	2010 Pine Sawtimber Forecast

	 
	 	 	 	 	 	 
	 
	 	Sum of PSCS	 	 	*	**
	 
	 	Sum of PSTS	 	 	*	**
	 
	 	Sum of PSTM	 	 	*	**
	 
	 	Sum of PSTL	 	 	*	**
	 
	 	Sum of PSMP	 	 	*	**
	 	 	 	 	 
	 
	 	Total	 	 	*	**
	 
	 	***	 	 	 	 

 

 

SCHEDULE 4

ANNUAL MINIMUM VOLUMES AND ANNUAL OBLIGATION FLOORS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Annual Minimum Volumes	 	 	 	Annual Obligation Floors	 
	 	 	Minimum Annual PST	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Harvest Plan (000 Tons)	 	 	 	 	 	 	 	(000 Tons)	 	 	 	 
	Year	 	NTX	 	 	STX	 	 	LA	 	 	CONS	 	 	TOTAL	 	 	 	NTX	 	 	STX	 	 	LA	 	 	CONS	 	 	TOTAL	 
	2008
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2009
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2010
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2011
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2012
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2013
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2014
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2015
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2016
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2017
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2018
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 
	2019
	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 	 	 	*** 	 

Schedule 4

 

SCHEDULE 5

FREIGHT ADJUSTMENT

DEFINITIONS

 

	 	 	 
	A

	 	Base Haul Rate
	 

	 	$*** per loaded ton-mi as the base $  per loaded ton-mile trucking Cost
	B

	 	Benchmark Fuel Price
	 

	 	$*** per gallon as the base $  per gallon retail on-highway diesel price
	C

	 	Current Fuel Price
	 

	 	Based on ***
	D

	 	***
	E

	 	***
	F

	 	Rate Adjustment Factor
	 

	 	***
	G

	 	Current Haul Rate
	 

	 	***

HAUL RATE FUEL ADJUSTMENT

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Calculation
	A
	 	Base Haul Rate

	 	$***	 	 
	B
	 	Benchmark Fuel Price

	 	$***	 	 
	C
	 	Current Fuel Price

	 	$***	 	 
	D
	 	***

	 	***
	 	***
	E
	 	***

	 	***	 	 
	F
	 	Rate Adjustment Factor

	 	***
	 	***
	G
	 	Current Haul Rate

	 	$***
	 	***

Schedule 5

 

SCHEDULE 6

INITIAL PRICE

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	PSCS	 	PSTS	 	PSTM	 	PSTL
	Northern Chipmill & Wdyd
	 	 	 	 	 	$	*	**	 	$	*	**	 	 	 	 
	Buna
	 	 	 	 	 	$	*	**	 	$	*	**	 	$	*	**
	Diboll
	 	 	 	 	 	$	*	**	 	$	*	**	 	 	 	 
	DeQuincy
	 	 	 	 	 	$	*	**	 	$	*	**	 	$	*	**
	Pineland Lumber
	 	 	 	 	 	$	*	**	 	$	*	**	 	 	 	 
	Pineland Studmill
	 	$	*	**	 	 	 	 	 	 	 	 	 	 	 	 
	Silsbee Wdyd
	 	 	 	 	 	$	*	**	 	$	*	**	 	$	*	**

Note: ***

PSTL Pricing Calculation

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	3rd	 	 	 	 	 	 	 	 
	 	 	Quarter	 	 	 	 	 	 	3rd	 
	 	 	PD	 	 	 	 	 	 	Quarter	 
	Mill	 	Volume	 	 	Volume %	 	 	PD Price	 
	 
	DeQuincy
	 	 	*	**	 	 	*	**%	 	$	*	**
	Buna
	 	 	*	**	 	 	*	**%	 	$	*	**
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	3-Year *** Adjustment Factor
	 	 	*	**
	 	 	Quarterly Price
	 	$	*	**

Schedule 6

 

SCHEDULE 7

PRODUCT VOLUME RANGE

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Minimum/Maximum Percentage of Delivery Volume	 
	 	 	By Product and Location	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Medium	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Sawtimber/Large	 
	 	 	Chip-n-Saw	 	 	Small Sawtimber	 	 	Sawtimber	 
	Location	 	Minimum	 	Maximum	 	Minimum	 	Maximum	 	Minimum	 	Maximum
	Buna Lumber &
	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%
	Silsbee Woodyard
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	DeQuincy Lumber
	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Medium Sawtimber

	Diboll Lumber &
	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%
	Northern Woodyard
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Pineland Lumber
	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Pineland Studmill
	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%	 	 	*	**%

Schedule 7

 

SCHEDULE 8

DISTINCTIVE SITES

	 	 	 	 	 	 	 
	SITE	 	ACRES	 	DESCRIPTION	 	LOCATION
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***
	***

	 	***
	 	***
	 	***

Schedule 8

 

SCHEDULE 9

BIOMASS HARVEST LOCATIONS

***

Schedule 9

 

SCHEDULE 10

OBLIGATED VOLUME PRODUCTS AND DELIVERY POINTS FOR 2007 AND 2008

PST

Obligated Volume 2007

	 	 	 	 	 	 	 	 	 
	Sawtimber	 	PSCS	 	PSTS	 	PSTM/PSTL	 	Total
	Buna
	 	***	 	***	 	***	 	***
	Dequincy
	 	***	 	***	 	***	 	***
	Diboll
	 	***	 	***	 	***	 	***
	Pineland Lumber
	 	***	 	***	 	***	 	***
	Pineland Studmill
	 	***	 	***	 	***	 	***
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Total	 	***
	 
	 	 	 	 	 	See Note (1)	 	 

Obligated Volume 2008

	 	 	 	 	 	 	 	 	 
	Sawtimber	 	PSCS	 	PSTS	 	PSTM/PSTL	 	Total
	Buna
	 	***	 	***	 	***	 	***
	Silsbee Woodyard
	 	***	 	***	 	***	 	***
	Dequincy
	 	***	 	***	 	***	 	***
	Diboll
	 	***	 	***	 	***	 	***
	Northern Woodyard
	 	***	 	***	 	***	 	***
	Pineland Lumber
	 	***	 	***	 	***	 	***
	Pineland Studmill
	 	***	 	***	 	***	 	***
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Total	 	***
	 
	 	 	 	 	 	See Note (2&3)	 	 

Note (1): ***

Note (2): ***

Note (3): ***

Schedule 10

 

Additional Volume 2007

	 	 	 	 	 	 	 	 	 
	Sawtimber	 	PSCS	 	PSTS	 	PSTM/PSTL	 	Total
	Buna
	 	***	 	***	 	***	 	***
	Dequincy
	 	***	 	***	 	***	 	***
	Diboll
	 	***	 	***	 	***	 	***
	Pineland Lumber
	 	***	 	***	 	***	 	***
	Pineland Studmill
	 	***	 	***	 	***	 	***
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	Total	 	***
	 
	 	 	 	 	 	See Note (4)	 	 

Note (4): ***

Schedule 10

 

SCHEDULE 11

PRICING EXAMPLE

     PINE SAWTIMBER DELIVERED PRICING TIMETABLE AND PRICE CALCULATION

	•	 	Pricing process timetable is outlined below:
	 
	 	 	— ***
	 
	•	 	Example pricing calculation:
	 
	 	 	— ***

Schedule
11

 

Exhibit A

Description of Property

***

CONSERVATION BLOCK

***

 

Exhibit B

Form of Support Agreement

[see attached]

 

SAWTIMBER SUPPORT AGREEMENT

***

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00137-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00137-of-00352.parquet"}]]