Document:

Exhibit 10.1

  
	
   

  	
   

  
	
  Boise Cascade, L.L.C.

  1111 West
  Jefferson Street   PO Box 50   Boise, ID 83728

  T 208 384
  6161   F 208 384 6566

  www.bc.com

  	
  

  

 

May 22,
2008

 

Boise
Inc.

Boise
Paper Holdings, L.L.C.

1111
W. Jefferson St. Suite 200

Boise,
Idaho 83702-5388

Attention:
General Counsel

 

 

Ladies
and Gentlemen:

 

Reference
is made to (i) that certain Purchase and Sale Agreement, dated as of September 7,
2007, by and among Boise Cascade, L.L.C. (“Seller”), Boise Paper
Holdings, L.L.C. (the “Company”), Boise Packaging & Newsprint,
L.L.C., Boise White Paper, L.L.C., Boise Cascade Transportation Holdings Corp.,
Boise Inc. (formerly known as Aldabra 2 Acquisition Corp., “Buyer”) and
Aldabra Sub LLC (“Buyer Sub”) (as amended by that certain Amendment No. 1
to Purchase and Sale Agreement, dated as of October 18, 2007, and that
certain Amendment No. 2 to Purchase and Sale Agreement, dated as of February 22,
2008, and as may further be amended, modified and/or supplemented from time to
time, the “Purchase and Sale Agreement”), (ii) that certain
promissory note (as amended, modified and/or supplemented from time to time,
the “Note”), dated as of February 22, 2008, originally made by
Buyer to the order of Seller in an original aggregate principal amount of
$41,000,000, and bearing interest and maturing as provided therein, and (iii) that
certain Note Assignment, dated February 22, 2008, between Seller and Boise
Cascade Holdings, L.L.C. (“BCH”), pursuant to which Seller transferred
to BCH all of Seller’s right, right, title and interest in and to the
Note.  Capitalized terms used, but not
otherwise defined, in this letter shall have the meanings given to them in the
Purchase and Sale Agreement.  Seller, Buyer,
Buyer Sub and the Company are referred to herein collectively as the “Parties”.

 

The
Parties and BCH acknowledge and agree for all purposes of the Purchase
Agreement (i) the Company Closing Cash Amount is $38,000,000.00, (ii) Company
Closing Net Working Capital is $345,806,783.44, (iii) Buyer Closing Net
Working Capital is $388,803,733.00 and (iv) the Closing Purchase Price is
$1,695,353,850.44.

 

As
a result of the Parties’ agreements discussed in the immediately preceding
sentence, the final Adjustment Amount due to Seller from Buyer pursuant to Section 1E(iv) and
Section 1F(i) of the Purchase and Sale Agreement is
$17,333,850.44 (the “Final Adjustment Amount”).  Pursuant to Section 1F(i) of
the Purchase and Sale Agreement and Section 2(c) of the Note,
the BCH and the Parties acknowledge and agree that, in

 

 

lieu
of delivering to Seller another Acceptable Note in respect of the Final
Adjustment Amount, the aggregate unpaid principal amount of the Note shall be
increased, effective as of the Effective Date (as such term is defined in the
Note), by an aggregate amount equal to the Final Adjustment Amount and interest
shall be deemed to have accrued and compounded on such additional principal
amount in accordance with the Note from and after the Effective Date (as such
term is defined in the Note).  In
furtherance of the foregoing, Buyer, Seller and BCH acknowledge and agree that
the date and amount of such increase to the Note shall be noted on Schedule
I to the Note, effective as of the date of this letter agreement, as set
forth on Schedule A attached to this letter agreement and upon the
adjustment to the Note in accordance with this paragraph, there shall be no
further adjustment to the Note pursuant to Section 1E of the
Purchase Agreement.

 

This
letter agreement may be executed in counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which taken
together shall constitute one and the same instrument.  Delivery of an executed counterpart of a
signature page of this letter agreement by facsimile transmission or
electronic pdf shall be effective as delivery of a manually executed
counterpart of this Amendment.  This
letter agreement is governed by the laws of the State of Delaware.  The provisions of this letter agreement may
not be amended without the prior written consent of each of BCH, Seller and
Buyer.  The rights of BCH and Seller
under this letter agreement may be assigned in whole or in part to one or more
transferees of the Note.  From time to
time, as and when requested by any party hereto, each party hereto shall
execute and deliver, or cause to be executed and delivered, all such documents
and instruments and shall take, or cause to be taken, all such other actions,
as any such other party hereto (or any of their permitted transferees or
assignees (including any transferees of the Note)) may reasonably deem
necessary or desirable to consummate or evidence the transactions contemplated
by this letter agreement on the terms herein described (including, without
limitation, in the case of Buyer, if and when requested by the holder(s) of
the Note, the execution and delivery of a new Note or Notes (in exchange for
surrender of the Note), as the case may be, as requested by the holder(s) and/or
transferee(s) thereof, which aggregate the unpaid principal amount of the
Note (after giving effect to the adjustments to the Note described in the
preceding paragraph) as such holder(s) and/or transferee(s) thereof
may request, in any such case, dated so that there will be no loss of interest
or principal (after giving effect to the adjustments to the Note described in
the preceding paragraph) on such surrendered Note and otherwise of like tenor
to the Note).  This letter agreement is
binding on and shall inure to the benefit of the parties hereto and their
successors and permitted assigns (including any subsequent holder(s) of
the Note or Notes (as such term is defined in the Note).

 

2

 

	
  Sincerely,

  
	
   

  
	
  BOISE CASCADE, L.L.C.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Tom Carlile

  	
   

  
	
  Name: Tom Carlile

  
	
  Title:  Executive Vice President and Chief Financial
  Officer

  
	
   

  	
   

  	
   

  
	
  BOISE CASCADE HOLDINGS, L.L.C.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Tom Carlile

  	
   

  
	
  Name: Tom Carlile

  	
   

  
	
  Title:  Executive Vice President and Chief Financial
  Officer

  
	
   

  	
   

  
	
  Acknowledged and agreed to as of the date first set forth above:

  
	
   

  	
   

  
	
  BOISE INC.

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Rob McNutt

  	
   

  
	
  Name:

  	
  Robert M. McNutt

  	
   

  
	
  Title:

  	
  Sr. Vice President & Chief Financial
  Officer

  	
   

  
	
   

  	
   

  	
   

  
	
  BOISE PAPER HOLDINGS, L.L.C.

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Rob McNutt

  	
   

  
	
  Name:

  	
  Robert M. McNutt

  	
   

  
	
  Title:

  	
  Sr. Vice President & Chief Financial
  Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  cc:

  	
  Sam Cotterell

  	
   

  
	
   

  	
  Rob McNutt

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Kirkland & Ellis LLP

  	
   

  
	
   

  	
  200 East Randolph Drive

  	
   

  
	
   

  	
  Chicago, IL 60601

  	
   

  
	
   

  	
  Attention: Richard J. Campbell, P.C.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Kramer Levin Naftalis & Frankel LLP

  	
   

  
	
   

  	
  1177 Avenue of the Americas

  	
   

  
	
   

  	
  New York, New York 10036

  	
   

  
	
   

  	
  Attention:
  Philip Weingold

  	
   

  

 

3

 

Schedule A

 

SCHEDULE
I TO THE NOTE

 

	
  Date

  	
   

  	
  Aggregate

  Principal

  Amount

  Outstanding

  Pre-Adjustment

  	
   

  	
  Accrued and
  Unpaid

  Interest Pre-

  Adjustment (including

  Accumulated Interest

  per Section 1(c))

  	
   

  	
  Aggregate
  Principal

  Amount Outstanding

  Post-Adjustment

  	
   

  	
  Accrued and
  Unpaid

  Interest Post-

  Adjustment (including

  Accumulated Interest

  per Section 1(c))

  	
   

  
	
  2/22/2008

  	
   

  	
  $

  	
  41,000,000

  	
   

  	
  N/A

  	
   

  	
  $

  	
  58,333,850.44

  	
   

  	
  N/A

  	
   

  
	
  3/31/2008

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  969,800.26

  	
   

  
	
  4/1/2008

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  59,303,650.70

  	
   

  	
  $

  	
  0.00

  	
   

  
	
  5/22/2008

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  1,349,158.05

  	
   

  
													

 

4Exhibit 10.2

 

REPURCHASE AGREEMENT

AND

AMENDMENT NO. 1 TO MANAGEMENT
EQUITY AGREEMENT

 

THIS REPURCHASE AGREEMENT AND AMENDMENT NO. 1 TO MANAGEMENT EQUITY
AGREEMENT (this “Agreement”) is made and entered into as of May 23,
2008, by and among Forest Products Holdings, L.L.C., a Delaware limited
liability company (the “Company”) and each of the persons listed on the
signature pages hereto as “Employee Investors” (each, an “Employee
Investor” and collectively, the “Employee Investors”).

 

Pursuant to that certain Management Equity Agreement, dated as of November 29,
2004, by and among the Company, the Employee Investors and the Investor (the “Original
Management Equity Agreement” and, as amended, modified, supplemented or
waived from time to time (including by this Agreement), the “Management
Equity Agreement”), each Employee Investor (i) purchased the number of
Series B Common Units of the Company set forth under such Employee
Investor’s name on the signature pages attached hereto as “Original Series B
Common Units Purchased” for the amount set forth under such Employee
Investor’s name on the signature pages attached hereto as “Original
Purchase Price” and (ii) received the number of Series C Common
Units of the Company set forth under such Employee Investor’s name on the
signature pages attached hereto “Original Series C Common Units
Received”.  Capitalized terms used,
but not otherwise defined, herein shall have the meanings given to such terms
in the Original Management Equity Agreement.

 

The Company, the Employee Investors and the Investor are executing and
delivering this Agreement in order to provide for (a) the repurchase by
the Company from each Employee Investor, for an aggregate purchase equal to the
Original Purchase Price for such Employee Investor, of a number of Series B
Common Units of the Company (rounded to the nearest whole Series B Common
Unit, the “Repurchased Units”) determined by dividing the Original
Purchase Price for such Employee Investor by $2.06 and (b) certain
amendments, modifications, supplements and waivers to the Original Management
Equity Agreement, as set forth in further detail herein.  For each Employee Investor, the number of
Repurchased Units and the Original Purchase Price for such Employee Investor is
set forth under such Employee Investor’s name on the signature pages attached
hereto as the “Repurchased Units”.

 

NOW, THEREFORE. the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally
bound hereby, covenant and agree as follows:

 

1.             Purchase and
Sale of Series B Common Units. 
At the Closing (as defined below) and upon the terms and conditions set
forth in this Agreement, each Employee Investor shall sell, transfer and assign
to the Company, and the Company shall purchase from each Employee 

 

 

Investor, all right,
title and interest in and to the Repurchased Units.  The aggregate purchase price payable by the
Company for the Repurchased Units shall be the Original Purchase Price and the
purchase price per Series B Common Unit payable by the Company for the
Repurchased Units shall be $2.06 per Series B Common Unit.  Each of the Company and the Employee Investor
acknowledge and agree that all of the Repurchased Units are Vested Series B
Common Units as of the date of this Agreement and were Vested Series B
Common Units as of February 22, 2008.

 

2.             Closing.  Subject to the terms and conditions contained
in this Agreement, the purchase and sale of the Repurchased Units (the “Closing”)
will take place at the headquarters of Boise Cascade, L.L.C. at 10:00 a.m.
on May 23, 2008.  At the Closing,
the Company shall deliver to each Employee Investor, by wire transfer of
immediately available funds to an account designated by such Employee Investor
in writing, or at the election of the Company with respect to any particular
Employee Investor, by check, an aggregate amount equal to the Original Purchase
Price and the Company shall cancel all of such Employee Investor’s Repurchased
Units and may, at any time after the Closing, amend the Schedule of Unitholders
to that certain Operating Agreement, dated as of October 29, 2004, by and
among the Company and its unitholders (as amended, modified, supplemented,
restated, or waived from time to time, the “Operating Agreement”) to provide
that the number of Series B Common Units owned by such Employee Investor
is reduced by the Repurchased Units.

 

3.             Closing
Conditions.  The obligation of the
Company to purchase the Repurchased Units from an Employee Investors is subject
to the representations and warranties of such Employee Investor contained in Section 4
being true and correct on the date hereof and at and as of the Closing as
though then made and such Employee Investor not having repudiated his or her
obligations hereunder.

 

4.             Representations
and Warranties.  Each Employee
Investor represents and warrants, effective as of the date hereof and at
Closing, as follows:

 

(a)          Ownership.  All of the Repurchased Units of such Employee
Investor are owned of record and beneficially by such Employee Investor, and
such Employee Investor has good title to the Repurchased Units, free and clear
of all security interests, claims, liens, pledges, options, encumbrances,
charges, agreements, voting trusts, proxies and other arrangements or
restrictions whatsoever (“Encumbrances”), other than those expressly set
forth in the Original Management Equity Agreement and the Operating Agreement
(the “Permitted Encumbrances”).  
At the Closing, such Employee Investor shall transfer to the Company
good title to the Repurchased Units, free and clear of all Encumbrances, other
than the Permitted Encumbrances.

 

(b)         Authorization.  Such Employee Investor has full power,
authority and legal capacity to enter into this Agreement and to perform its
obligations hereunder.  This Agreement
has been duly executed and delivered by such Employee Investor, and constitutes
a valid and legally binding obligation of such Employee Investor, enforceable
in accordance with its terms.

 

2

 

(c)           Conflicts.  The execution, delivery and performance of
this Agreement by such Employee Investor does not conflict with, violate or
result in the breach of, or create any Encumbrance on the Repurchased Units
pursuant to, any agreement, instrument, order, judgment, decree, law or
governmental regulation to which such Employee Investor is a party or is
subject or by which the Repurchased Units are bound.  Other than such rights in favor of the
Company and/or one or more of the unitholders of the Company, including the
Investor, pursuant to the Original Management Equity Agreement, the sale,
transfer or disposition of the Repurchased Units by such Employee Investor to
the Company is not subject to any statutory or contractual preemptive right,
right of first refusal, right of first offer or similar right, and no person
other than the Company and/or the Investor has any right to acquire any of the
Repurchased Units or any right, title or interest therein from such Employee
Investor.

 

(d)           Stock Agreements.
 Other than the Operating Agreement and
the Original Management Equity Agreement, there are no shareholder agreements,
voting agreements or other documents which relate to the rights and obligations
of such Employee Investor with respect to the Repurchased Units.

 

(e)           No Reliance.  Such Employee Investor has conducted its own
independent evaluation and made its own analysis as such Employee Investor has
deemed necessary, prudent and advisable in order for such Employee Investor to
make his or her own determination and decision to enter into this Agreement and
consummate the transactions contemplated hereby.  Without limiting the generality of the
foregoing, such Employee Investor has had an opportunity to review the Agreement
and has conducted all due diligence and received all materials and information
that it deems relevant, including with respect to the Company’s future business
prospects, in connection with such Employee Investor’s decision to sell the
Repurchased Units to the Company under this Agreement.  Each Employee Investor is entering into this
Agreement without reliance upon any oral or written representations and
warranties of any kind or nature by the Company or any of their affiliates
(including the Investor) or any of their respective officers, directors,
stockholders, partners or employees. 
Such Employee Investor understands and agrees that he or she has not
relied upon any statement of the Company or any of their affiliates  (including the Investor) or any of their
respective officers, directors, stockholders, partners or employees regarding
the value of the Repurchased Units and that no representation or warranty has
been or is being made by the Company or any of their affiliates (including the
Investor) or any of their respective officers, directors, stockholders,
partners or employees regarding the value of the Repurchased Units.  Such Employee Investor further understands
that the value of the Company’s units (including the Repurchased Units) is
uncertain and could be substantially more or less than the purchase price paid
by the Company to such Employee Investor hereunder.  Such Employee Investor understands that the
Company’s plans for the future may result in the Company’s units (including the
Repurchased Units) becoming significantly more valuable and that the future
value of the Company’s units (including the Repurchased Units) could exceed the
amounts that such Employee Investor will receive from the Company under this
Agreement.  Such Employee Investor has
determined to forego the possibility of such future value to obtain the
consideration being paid pursuant hereto at the present time.  Such Employee Investor has been provided with
an opportunity to consult with independent legal counsel, 

 

3

 

business advisors and tax
advisors regarding its rights and obligations under this Agreement and such
other business and tax matters as are relevant to such Employee Investor prior
to entering into this Agreement and selling the Repurchased Units, fully
understands the terms and conditions contained herein and intends for such
terms to be binding and enforceable upon such Employee Investor.

 

5.             Certain
Amendments.  By its execution and
delivery hereof, each of the Company, the Investor and each Employee Investor
acknowledges and agrees that (i) all references in the Management Equity
Agreement to (a) the “Investors” shall be references to Madison Dearborn
Capital Partners IV, L.P., (b) “Class B Units”, “Class B Units
of the Company” and “Vested Class B Units” shall instead be references to,
respectively, “Series B Common Units”, “Series B Common Units of the
Company” and “Vested Series B Common Units” and (c) “Class C
Units”, “Class C Units of the Company”, “Time Vesting Class C Units”,
“Performance Vesting Class C Units” and “Vested Class C Units” shall
instead be references to, respectively, “Series C Common Units”, “Series C
Common Units of the Company”, “Time Vesting Series C Common Units”, “Performance
Vesting Series C Common Units” and “Vested Series C Common Units” and
that the Original Management Equity Agreement is hereby amended accordingly and
(ii) Section 2(d)(iii) of the Original Management Equity
Agreement is hereby amended by replacing the word “quarterly” in the second
sentence thereof with “annually”.

 

6.             Certain
Provisions Relating to Employee Investors That Were Not At Least 62 Years Old
as of December 31, 2004 and, in the case of Section 6(d), All
Employee Investors.

 

(a)           Each of the Company
and each Employee Investor that was not at least 62 years old as of December 31,
2004 acknowledges and agrees that, as of February 22, 2008, (x) a
number of such Employee Investor’s Original Series C Common Units Received
equal to (i) 0.3145 multiplied  by (ii) such Employee
Investor’s Original Series C Common Units Received (such product, for each
such Employee Investor, such Employee Investor’s “2/22/08 Vested Series C
Common Units”) have vested and are “Vested Series C Common Units” and “Vested
Units” for all purposes of the Management Equity Agreement, (y) a number
of such Employee Investor’s Original Series C Common Units  Received equal to (i) 0.6855 multiplied
by (ii) such Employee Investor’s Original Series C Common
Units Received (such product, for each such Employee Investor, such Employee Investor’s
“2/22/08 Unvested Series C Common Units”) have not vested and are “Unvested
Series C Common Units” and “Unvested Units” for all purposes of the
Management Equity Agreement, and (z) the number of 2/22/08 Vested Series C
Common Units and 2/22/08 Unvested Series C Common Units for each such
Employee Investor are set forth underneath such Employee Investor’s name on the
signature page hereto.  Each of the
Company and each Employee Investor that was not at least 62 years old as
of December 31, 2004 agree that, notwithstanding anything to the contrary
in Section 2(c)(i), Section 2(c)(ii) and Section 2(d) of
the Management Equity Agreement, but without otherwise limiting the provisions
of Section 2(c)(iii), Section 2(c)(iv) and Section 2(c)(v) of
the Management Equity Agreement with respect to such Remaining Time Vesting Series C
Common Units (as hereinafter defined) and without otherwise limiting the
provisions of Section 2(d) of the Management Equity Agreement
with respect to the Remaining 

 

4

 

Performance Vesting Series C
Common Units, a number of 2/22/08 Unvested Series C Common Units
determined by multiplying (A) 0.7294 by (B) the 2/22/08 Unvested Series C
Common Units (such product, the “Remaining Time Vesting Series C Common
Units” (being 50% of such Employee Investor’s Original Series C Common
Units Received)) shall be “Time Vesting Class C Units” and shall vest
ratably on a daily basis during the period from February 22, 2008 through
and including December 31, 2010; provided that, without limiting
the provisions of Section 2(c)(iv) of the Management Equity
Agreement, if such Employee Investor ceases to be employed by the Company or
any of its Subsidiaries on a full-time basis prior to December 31, 2010, the
total number of Remaining Time Vesting Series C Common Units that shall
have vested in accordance with this sentence shall be determined as the total
number of Remaining Time Vesting Series C Common Units multiplied  by
a fraction, the numerator of which is the number of days from February 22,
2008 through and including the date of termination and the denominator of which
is the total number of days from February 22, 2008 through and including December 31,
2010.  Each Employee Investor’s Remaining
Time Vesting Series C Common Units are set forth underneath such Employee
Investor’s name on the signature page hereto.

 

(b)           Each of the Company
and each Employee Investor that was not at least 62 years old as of December 31,
2004 acknowledges and agrees that, as of February 22, 2008, a number of
2/22/08 Unvested Series C Common Units determined as the excess of (i) the
2/22/08 Unvested Series C Common Units minus (ii) the
Remaining Time Vesting Series C Common Units (such excess, the “Remaining
Performance Vesting Series C Common Units” (being 18.55% of such
Employee Investor’s Original Series C Common Units  Received)) shall be “Performance Vesting Series C
Common Units” for all purposes of the Management Equity Agreement and shall
vest, if at all, in accordance with Section 2(d) of the Management
Equity Agreement.  Each Employee Investor’s
Remaining Performance Vesting Series C Common Units are set forth
underneath such Employee Investor’s name on the signature page hereto.

 

(c)           Each of the Company
and each Employee Investor that was not at least 62 years old as of December 31,
2004 acknowledges and agrees that, as of February 22, 2008, that clause (b) of
Section 2(d)(i) of the Original Management Equity Agreement
is, with respect to such Employee Investor, amended by deleting “December 31,
2009” and replacing the same with “December 31, 2010”.

 

(d)           Each of the Company
and each Employee Investor acknowledges and agrees that Section 2(d)(iv) and
Section 2(d)(v) of the Original Management Equity Agreement are, with
respect to such Employee Investor, amended and restated as follows:

 

“(iv)        The Board shall provide to any Employee
Investor, within 30 days of such Employee Investor’s written request, a
reasonably detailed description of the calculations and values employed in
determining the IRR Fair Value, IRR, Cash Inflows, Cash Outflows and
Indebtedness, in each case to the extent relevant to the calculation of IRR
Fair Value and IRR for such Employee Investor. 
The Board shall also provide to such Employee Investor copies of or
access to all related underlying financial statements, third-party valuation
reports and 

 

5

 

accounting and business
records subject to such Employee Investor agreeing to appropriate confidentiality
restrictions.

 

(v)          If the Series B Common Units are
publicly traded, the “IRR Fair Value” will be equal to the Fair Market
Value of the Series B Common Units. 
If the Series B Common Units are not publicly traded but the
Company’s sole asset is an interest in a publicly traded security (or an
indirect interest in such a security through the ownership of other equity
securities), then the “IRR Fair Value” will be equal to the aggregate Fair
Market Value of such publicly traded security to the holders of Series B
Common Units, divided by the number of Series B Common Units.  If the Series B Common Units are not
publicly traded and the Company has assets other than a direct or indirect
interest in a publicly traded security, then the IRR Fair Value of the Series B
Common Units will be determined as follows: (1) first, the enterprise
value of Boise Holdings will be determined utilizing the most recent (relative
to the Determination Date) third-party valuation for Boise Holdings received by
the Company or Boise Holdings and shall be determined without regard to any
valuation of the debt or equity securities of Boise Inc. then owned or held by
Boise Holdings or any of its Subsidiaries; (2) second, the equity value of
Boise Holdings will be determined by (x) without any duplication to any
amount used in computing enterprise value, increasing such enterprise value by (a) the
Fair Market Value of the Boise Inc. common stock owned or held by Boise
Holdings or any of its Subsidiaries, (b) the aggregate principal amount
plus accrued and unpaid interest of any promissory note of Boise Inc. owned or
held by Boise Holdings (provided that if any portion of such promissory note
has been sold or transferred to a third party, ascribing the value to the
remainder of such promissory note implied by such sale or transfer), and (c) the
aggregate cash of Boise Holdings and its Subsidiaries and (y) without any
duplication to any amount used in computing enterprise value, reducing such
enterprise value by (a) the total amount of Indebtedness of Boise Holdings
and its Subsidiaries and (b) any equity securities of any Subsidiaries of
Boise Holdings as of the Determination Date owned by any Person other than
Boise Holdings or any of its wholly-owned Subsidiaries; (3) third, by
assuming the equity value of Boise Holdings is distributed in accordance with
the distribution provisions of the Boise Holdings Operating Agreement, and (4) the
value of a Series B Common Unit will be determined by assuming an amount
(the “Company Equity Value Amount”) equal to (I) the distributions
to the Company from Boise Holdings as determined in accordance with clause (3) foregoing,
plus (II) the fair market value of any assets of the Company (as
determined by the Board), other than the equity securities of Boise Holdings,
and minus (III) any Indebtedness and other liabilities of the Company (as
determined by the Board) and assuming the Company Equity Value Amount was
distributed to the holders of Units in accordance with the LLC Agreement and
determining the amount distributed to each Series B Common Unit as a
result of such distribution (which will be determined on a fully diluted basis,
assuming full vesting of all of all Units that are or would become vested at
the time of such IRR calculation).”

 

7.             Certain Provisions
Relating to Employee Investors That Were At Least 62 Years Old as of December 31,
2004.  Each of the Company and each
Employee Investor that was at 

 

6

 

least 62 years old as of December 31,
2004 acknowledges and agrees that, as of February 22, 2008, 100% of such
Employee Investor’s Original Series C Common Units Received have vested
and are “Vested Series C Common Units” and “Vested Units” for all purposes
of the Management Equity Agreement.

 

8.             Certain
Provisions Relating to Employee Investors That Were At Least 60 Years Old, But
Were Not At Least 62 Years Old, as of December 31, 2004.  Each of the Company and each Employee
Investor that was at least 60 years old, but not at least 62 years old, as of December 31,
2004 (each such Employee Investor, an “Applicable Employee Investor”)
acknowledges and agrees that (a) notwithstanding Section 6(a) of
this Agreement, the vesting schedule for each Applicable Employee Investor
shall be accelerated such that 100% of such Applicable Employee Investor’s
Remaining Time Vesting Series C Common Units shall vest ratably on a daily
basis during the period from February 22, 2008 through and including December 31
of the year in which such Applicable Employee Investor turns 65 (for each such
Employee Investor, such Employee Investor’s “Time Vesting Termination Date”);
provided that, without limiting the provisions of Section 2(c)(iv) of
the Management Equity Agreement, if such Employee Investor ceases to be
employed by the Company or any of its Subsidiaries on a full-time basis prior
to such Employee Investor’s Time Vesting Termination Date, the total number of
Remaining Time Vesting Series C Common Units that shall have vested in
accordance with this sentence shall be determined as the total number of
Remaining Time Vesting Series C Common Units multiplied  by a
fraction, the numerator of which is the number of days from February 22,
2008 through and including the date of termination and the denominator of which
is the total number of days from February 22, 2008 through and including
such Employee Investor’s Time Vesting Termination Date and (b) notwithstanding
Section 6(b) of this Agreement and Section 2(d)(i) of the
Original Management Equity Agreement, for each Applicable Employee Investor,
such Applicable Investor’s “Determination Date” shall be the earlier of (i) a
Sale of the Company and (ii) such Applicable Employee Investor’s Time
Vesting Termination Date.

 

9.             No Transfer or
Assignment.  No interest or right any
Employee Investor or any of its beneficiaries has to receive payment under this
Agreement shall be subject in any manner to sale, transfer, assignment, pledge,
attachment, garnishment, or other alienation or encumbrance of any kind, except
as required by law; nor may such interest or right to receive payment be taken,
voluntarily or involuntarily, for the satisfaction of the obligations or debts
of, or other claims against such Employee Investor or any of its beneficiaries,
except to the extent required by law.

 

10.           Survival of
Representations and Warranties.  All
representations and warranties contained herein or made by any Employee
Investor in connection herewith shall survive the execution and delivery of
this Agreement and the Closing hereunder.

 

11.           Continued
Existence of Operating Agreement and Management Equity Agreement.  Each of the Company and each Employee
Investor acknowledges and agrees that the Operating Agreement and the
Management Equity Agreement remains in full force and effect and 

 

7

 

that such Employee
Investor remains bound by the Operating Agreement and the Management Equity
Agreement with respect to all units of the Company, other than the Repurchased
Units.

 

12.           Release.  Each Employee Investor (for himself or
herself and his or her heirs, beneficiaries and assigns) hereby fully releases
and forever discharges the Company and its affiliates (including the Investor)
and their respective officers, directors, stockholders, partners and employees
(collectively, the “Released Parties”) from any and all claims, suits,
arbitrations, proceedings, actions, causes of action, demands, covenants,
obligations, damages (of any kind), costs, expenses and attorneys’ fees, or
liabilities of any nature whatsoever in law and in equity, by statute, contract
or otherwise, both past and present and whether known or unknown, suspected or
unsuspected, vested or contingent, disclosed or undisclosed, concealed or
hidden, which have existed or may have existed, or which do exist, through the
Closing which arise out of, are connected with or relate in any way to such
Employee Investor’s acquisition of the Repurchased Units and ownership of the
Repurchased Units (including in its capacity as a unitholder of the Company) or
the sale, transfer or assignment of Repurchased Units to the Company pursuant
to this Agreement or the other transactions contemplated hereby (other than in
respect of the payment of the purchase price for the Repurchased Units by the
Company in breach of this Agreement) (all of the foregoing collectively
referred to herein as the “Claims”). Each Employee Investor hereby
irrevocably covenants to refrain from, directly or indirectly, asserting any
claim or demand, or filing, commencing, instituting or causing to be filed,
commenced or instituted any suit, complaint, charge or other proceeding of any
kind against any of the Released Parties, based upon any of the Claims.  Each Employee Investor further acknowledges
and agrees that this release and discharge is an essential and material term of
this Agreement in which the Company is relying and that without such release
and discharge the Company would not have entered into this Agreement.  Each Employee Investor hereby represents and
warrants that such Employee Investor does not have any claim with respect to
the Repurchased Units, other than any Claims that are released by this
Agreement.  Each Employee Investor
expressly waives any and all rights and benefits conferred upon such Employee
Investor by the provisions of California Civil Code Section 1542, which
provides as follows: “A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.”

 

13.           Complete Agreement.  This Agreement, together with the Management
Equity Agreement and the Operating Agreement, constitute the entire agreement
between the parties hereto regarding the subject matter of this Agreement and
supersede and preempt any prior understandings, agreements or representations,
written or oral, which may have related to the subject matter hereof.  When used herein, “including” means “including,
without limitation” regardless of whether such or similar terminology is
actually used.

 

14.           Counterparts.  This Agreement may be executed in separate
counterparts (including by means of facsimile transmission or other electronic
transmission), each of which shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.

 

8

 

15.           Further
Assurances.  After the Closing, as
and when requested by the Company and each Employee Investor shall, without
further consideration, execute and deliver all such instruments of purchase,
conveyance and transfer and shall take such further actions as the Company may
reasonably deem necessary or desirable in order to sell, transfer and assign
the Repurchased Units as contemplated hereby and to otherwise carry out fully
the provisions and purposes of this Agreement.

 

16.           Successors and
Assigns.  This Agreement is intended
to bind, inure to the benefit of and be enforceable by the Company and each
Employee Investor and their respective successors and permitted assigns; provided,
however, that no Employee Investor may 
assign this Agreement or any rights or obligations hereunder without the
Company’s prior written consent.

 

17.           Governing Law.  All issues and questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by, and construed in accordance with the law of the State of Idaho,
without giving effect to any choice of law or conflict of law rules or
provisions (whether of the State of Idaho or any other jurisdiction) that would
cause the applications of the law of any jurisdiction other than the State of
Idaho.

 

18.           Severability.  Whenever possible, each provision of this
Agreement shall be interpreted in a manner to be effective and valid under
applicable law, but if any provision shall be 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 or affecting the remainder
of such provision or any of the remaining provisions of this Agreement.

 

19.           Notices.  Any notice provided for in this Agreement
must be in writing and must be either personally delivered, mailed by first
class mail (postage prepaid and return receipt requested), telecopied or sent
by reputable overnight courier service (charges prepaid) to an Employee
Investor at the address set forth under such Employee Investor’s name on the
signature page attached hereto and to any other recipient at the address
or telecopy number below indicated:

 

	
   

  	
  If to the
  Company:

  

 

	
   

  	
  Forest Products
  Holdings, L.L.C.

  
	
   

  	
  c/o
  Boise Cascade, L.L.C.

  
	
   

  	
  1111
  W. Jefferson St.

  
	
   

  	
  Attention: General Counsel

  
	
   

  	
  Telecopy: (208) 384-6566

  

 

	
   

  	
  with a copy to:

  
	
   

  
	
   

  	
  Kirkland &
  Ellis LLP

  
	
   

  	
  200 East Randolph Drive

  
	
   

  	
  Chicago, IL 60601

  
	
   

  	
  Attention: Richard J. Campbell P.C.

  
	
   

  	
  Telecopy:  (312) 861-2200

  
			

 

 

9

 

	
   

  	
  If to the
  Investor:

  
	
   

  	
   

  
	
   

  	
  Madison Dearborn Capital Partners IV, L.P.

  
	
   

  	
  Three First National Plaza, 38th Floor

  
	
   

  	
  70 W. Madison Street

  
	
   

  	
  Chicago, IL 60602

  
	
   

  	
  Telecopy: (312) 895-1001

  

 

or to such other
address or to the attention of such other person as the recipient party shall
have specified by prior written notice to the sending party.  Any notice under this Agreement will be
deemed to have been given, if personally delivered, when so delivered, if
mailed by first class mail as provided above, five days after deposit in the
U.S. mail, if telecopied, upon confirmation of successful transmission, on the
date of transmission if such transmission is completed at or prior to 5:00 p.m.
local time of the recipient party on a business day (or otherwise on the next
business day), or if sent by reputable overnight courier service as provided
above, one business day after delivery to such courier service.

 

*     *     *    
*     *

 

10

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

 

 

	
  COMPANY

  	
   

  
	
   

  	
   

  
	
  FOREST PRODUCTS HOLDINGS, L.L.C.

  	
   

  

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  

 

 

 

	
  EMPLOYEE INVESTOR:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Name:

  	
   

  
	
   

  	
   

  
	
  Address:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Repurchased Units:

  	
   

  
	
   

  	
   

  
	
  Original Purchase Price:

  	
   

  
	
   

  	
   

  
	
  Original Series B Common Units Purchased:

  	
   

  
	
   

  	
   

  
	
  Original Series C Common Units Received:

  	
   

  
	
   

  	
   

  
	
  2/22/08 Vested Series C Common Units:

  	
   

  
	
   

  	
   

  
	
  2/22/08 Unvested Series C Common Units:

  	
   

  
	
   

  	
   

  
	
  Remaining Time Vesting Series C Common Units:

  	
   

  
	
   

  	
   

  
	
  Remaining Performance Vesting Series C Common
  Units:

  	
   

  

 

11

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