PURCHASE AGREEMENT Dated as of the 15th day of March, 2008, Between WEYERHAEUSER COMPANY and INTERNATIONAL PAPER COMPANY

The Service Provider shall provide, or cause to be provided, to the Service Recipient Services that are of substantially the same nature and quality that Seller provided for the Business during the twelve-month period prior to the Closing (and which shall be of substantially the same nature and quality that Seller provides to itself), at substantially the same priority levels that such Services have been accorded during such twelve-month period; provided that for the purposes of determining the quality and quantity of service during twelve-month period prior to Closing, service levels provided by Hewlett-Packard and Verizon shall be disregarded, and provided further appropriate modifications in manner of delivery may be made for security, confidentiality and data integrity so long as such modifications do not adversely affect the quality or quantity of the Services delivered hereunder.

During the term of this Agreement, the Service Recipient agrees to abide by the reasonable IT security safeguards and policies that the Service Provider has in place and may implement to reasonably protect the Service Provider’s systems and data. The Parties will reasonably cooperate regarding the delivery of Services in order to facilitate an efficient delivery of Services and shall consult regularly to confirm that the Parties are satisfied with the Services under this Agreement. Each Party agrees to make their respective Lead Representative or designee available for such consultation. Notwithstanding the foregoing, the Parties acknowledge that manner, means, and resources to provide the Services are in the discretion of the Service Provider.

2.4.

The Service Provider shall not be obligated to perform services other than the Services described in the Schedules hereto.

2.5.

The Service Recipient may, from time to time, request that the Service Provider provide reasonable additional services not included in the Schedules hereto related to the Business during the Transition Period, including services (other than Specialized Transition-out Services provided pursuant to Section 2.6) relating to the Service Recipient’s transition to non-Service Provider systems, including but not limited to migration of historical data, migration-specific enhancements and cooperation with and assistance to third-party consultants or outsourced service providers engaged by the Service Recipient in connection with the foregoing and other Transition-out Services, legislated change by a Governmental Entity, customer requirements, shipping/custom changes, functional enhancements interface development or changes or converting to another platform or application (“Additional Services”). The Service Provider shall consider each request for Additional Services in good faith, and if the Service Provider determines that it is prepared to provide the Service Recipient with all or a portion of the Additional Services identified in the request, it shall submit to the Service Recipient a written proposal to provide such Additional Services itself or through a third-party setting forth each Additional Service to be performed, the time period for performance of such Additional Service, the quality and nature and service level of such Additional Service and the amounts to be charged for performance of such Additional Service, which amounts shall be based on the Service Provider’s fully allocated cost including the fees of any third-party provider at the same rates as the other Services.

2.6.

The Service Recipient may, from time to time, request that the Service Provider provide reasonable additional Transition-out services not included in the Schedules hereto, including services relating to the Service Recipient’s transition to non-Service Provider systems, including but not limited to migration of historical data, migration-specific enhancements and cooperation with and assistance to third-party consultants or outsourced service providers engaged by the Service Recipient in connection with the foregoing. The Service Provider shall consider each request for such additional Transition-out services in good faith. For those additional Transition-out services (i) that the Service Provider determines it is capable of providing without negatively impacting the Seller Business or other services the Service Provider is providing for third parties or (ii) for which the Service Provider is uniquely situated to provide, the Service Provider shall submit to the Service Recipient a written proposal to provide such additional Transition-out services (the “Specialized Transition-out Services”) itself or through a third-party setting forth each Specialized Transition-out Service to be performed, the time period for performance of such Specialized Transition-out Service, the quality and nature and service level of such Specialized Transition-out Service, and the amounts to be charged for performance of such Specialized Transition-out Service, which amounts shall be the same as that charged for the other Services provided under this Agreement. If there is no competent third-party provider capable of providing a Specialized Transition-out Service to the Service Recipient at a reasonable market price, the Service Provider must, subject to the conditions and limitations set forth in Section 2.6(b) below, provide such Specialized Transition-out Service on the terms set forth in the written proposal and herein.

The Specialized Transition-out Services that must be provided under Section 2.6(a) are subject to the following conditions and limitations: (i) the Service Recipient must provide written notice at least 60 days prior to the date it desires the Specialized Transition-out Services to commence, which notice must define the scope of the Specialized Transition-out Services and identify the desired commencement date; and (ii) the Service Provider is only required to provide five (5) full-time equivalents in connection with the provision of such Specialized Transition-out Services at any time unless otherwise agreed. In addition, the enhanced rates in Section 5.3 for Services extended beyond 12 months do not apply to Specialized Transition-out Services that must be provided under Section 2.6(a) if such Specialized Transition-out Services were requested prior to the first anniversary of the Closing.

2.7.

At the request of the Service Recipient, Seller shall provide or cause to be provided additional services (the “Mandatory Services”), if necessary, to enable Seller to cure any non-compliance by Seller with Section 4.14 of the Purchase Agreement arising out of the omission from Section 4.14(a) of the Seller Disclosure Letter of a corporate level service that was being provided by Seller to the Business on the date of the Purchase Agreement. Such services shall be provided at Seller’s cost until such time as they are no longer required or, if earlier, the first anniversary of the Closing.

Purchaser and Seller shall act in good faith in a manner reasonably expected to enable the Mandatory Services to be provided as efficiently as possible.

2.8.

The Service Provider may use third-parties to provide some or all of the Services. The Service Provider agrees that to the extent such third-party Services are provided to the Service Recipient pursuant to contracts between the Service Provider and the third-party service provider, the Service Provider will enforce rights, including obligations of the third-party service provider to comply with specified service levels, against any such third-parties relating to the Services to the extent it would otherwise enforce such rights on behalf of itself under similar circumstances relating to similar matters. Unless specifically agreed in writing by the parties, the Service Recipient will not be responsible for any incremental costs associated with third-party contracts initiated during the Transition Period by the Service Provider. The Service Provider will consult with and obtain the consent of (such consent to be provided within five (5) Business Days and not to be unreasonably withheld) the Service Recipient prior to retaining any third-party to provide Services where such third-party is not also providing similar services to Service Provider for the Seller Business.

2.9.

In the event of any breach of this Article 2 by the Service Provider with respect to any Service and provided that the Service Recipient is not in breach of its obligations under Articles 3 and 4, the Service Provider shall, at the Service Recipient’s request, without the payment of any further fees by the Service Recipient, correct or cause to be corrected such error or defect or reperform or cause to be reperformed such Service, as promptly as practicable, and cause such Service to be provided thereafter in conformity with the standard set forth in Section 2.2.

3. PRICING, BILLING AND PAYMENT

3.1.

The Services will be charged to and payable by the Service Recipient in accordance with the Schedules hereto, as applicable, or as otherwise specified in this Agreement, which amounts shall be based on the Service Provider’s fully allocated cost including the fees of any third-party provider, in each case for services requiring a similar skill set used in Seller’s 2007 fiscal year. The Service Provider represents that the aggregate fully allocated costs for the Services specified on the Schedules hereto do not exceed the aggregate fully allocated costs for the same services provided to the Business in Seller’s 2007 fiscal year.

3.2.

On or prior to the twenty-first (21st) day of each calendar month (or if such day is not a Business Day, the next succeeding Business Day), the Service Provider shall provide the Service Recipient with an invoice representing the estimated total charges for Services for such calendar month (the “Monthly Estimated Charge”), which invoice shall be payable on the first day of the next-following calendar month (or if such day is not a Business Day, the next succeeding Business Day). No later than twenty-one (21) days after the last day of each Seller fiscal quarter (a “Reference Quarter”), the Service Provider shall provide to the Service Recipient an invoice for the Reference Quarter’s Services (the “Quarterly Actual Charges”), which shall include (i) the Services provided by the Service Provider to the Service Receivers for such Reference Quarter, (ii) the charges for such Services and (iii) a list of the costs and expenses incurred by the Service Provider for such Reference Quarter that are subject to reimbursement in accordance with the Schedules attached hereto. If the amount stated in such invoice less the Monthly Estimated Charges for the relevant Reference Quarter are greater than zero, such amount shall be paid by the Service Recipient in full within forty-five (45) days of the invoices being issued to an account designated by the Service Provider and if less than zero, the Monthly Estimated Charge issued in the next succeeding Seller fiscal month shall be reduced by such amount, or if the Agreement has terminated and no further payments are due, Service Recipient shall promptly pay to Service Provider such amount.

3.3.

The cost of each Service is a monthly cost, and the full monthly cost of each Service (applying the volume level, if applicable, of such Service at the beginning of a Seller fiscal month) shall apply in respect of such Service until such Service is terminated in its entirety.

3.4.

One time set up charges consistent with the principles set forth on Annex A hereto (“One Time Costs”) incurred by the Service Provider in connection with the set-up services identified on the Schedules hereto shall be shared by the Parties on a 50/50 basis. Additional One Time Costs incurred by the Service Provider or incurred by the Service Recipient, in each case which are mutually agreed to by the Parties, shall also be shared by the Parties on a 50/50 basis regardless of which Party incurred the cost. Each Party shall periodically deliver to the other notice of One Time Costs incurred to date. At the time of delivery of the first Monthly Estimated Charge invoice, as specified in Section 3.2, the end of each Reference Quarter and on termination of the Agreement, each Party will deliver an invoice to the other. To the extent one Party’s actual incurred One Time Costs exceed 50% of the aggregate One Time Costs, the other Party shall reimburse such Party so that each Party bears 50% of the aggregate.

4. ACCESS

The Service Provider and the Service Recipient shall, and shall cause their respective affiliates to, provide to each other and their respective agents and vendors reasonable access (during normal business hours, upon reasonable notice and supervised by the appropriate personnel of the Parties or as otherwise agreed by the Parties) to the information, personnel, and systems necessary for the efficient and accurate administration of each of the Services and to avoid the duplication of any expenses or benefits thereunder; provided, that all such information shall be shared subject to the confidentiality obligations set forth in Article 10, and any Party or third-party vendor receiving such information shall agree to be bound by such obligations prior to the provision of any such information.

5. TRANSITION

5.1.

The Parties agree to use commercially reasonable efforts to cooperate with and assist each other in order to permit the Transition-out to occur as soon as reasonably practicable, but in any event prior to the end of the obligation of the Service Provider to provide such Services hereunder, taking into account the need to minimize both the cost of the Transition-out and the disruption to the ongoing business activities of the Parties.

5.2.

It is the intent of the Parties that the Service Recipient will be able to perform for itself the Services following the discontinuance of such Services by the Service Provider. In furtherance of the foregoing, the Service Provider agrees to cooperate with and assist the Service Recipient with training of its personnel, including making its personnel and facilities available to train an agreed number of the Service Recipient’s personnel in connection with the Transition-out to permit the Service Recipient to provide the Services for itself after the Transition Period.

5.3.

As an incentive for the Service Recipient to complete the Transition-out as soon as reasonably practicable, for each Service identified on Schedule A hereto that has not been terminated by the first anniversary of the Closing, the Service Recipient shall pay the Service Provider a one-time payment equal to 10% of the aggregate set-up costs relating to such Service (including the unbilled portions thereof), which amount shall be payable by the Service Recipient within five (5) Business Days of receipt of the invoice for such one-time payment to an account designated by the Service Provider. In addition, the charges for each such Service provided after the first anniversary of the Closing shall be invoiced at 150% of the costs specified on Schedule A hereto.

6. IDEMNITY

6.1.

Subject to the provisions of Section 6.2, Seller (the “Indemnifying Party”) agrees to indemnify and hold Purchaser and its affiliates and its and their respective officers, directors, shareholders, employees and agents (each, an “Indemnified Party”) harmless from any damages, loss, cost or liability (including reasonable legal fees and expenses and the cost of enforcing this indemnity) arising out of or resulting from the negligence or wilful misconduct of the Indemnifying Party or any of its affiliates in the performance of the Services, or any breach of any representation, warranty, covenant or obligation under this Agreement by the Indemnifying Party or any of its affiliates.

6.2.

The amount of any damages, losses, costs or liabilities for which indemnification is provided under this Article 6 shall be net of any amounts actually recovered by the Indemnified Party in respect of such damages, losses, costs or liabilities under its insurance policies.

6.3.

Notwithstanding anything to the contrary contained herein, the liability of the Service Provider with respect to any Service provided pursuant to this Agreement or anything done in connection therewith, whether in contract, tort or otherwise, shall not exceed the fees previously paid by the Service Recipient to the Service Provider pursuant to this Agreement in respect of such category of Service.

7. LIMITED WARRANTY

NOTWITHSTANDING ANY PROVISION TO THE CONTRARY, UNLESS EXPRESSLY SET FORTH HEREIN, THE SERVICE PROVIDER REPRESENTS AND WARRANTS ONLY THAT THE SERVICES SHALL BE IN CONFORMITY WITH THIS AGREEMENT. THE ABOVE-STATED LIMITED WARRANTY IS THE SERVICE PROVIDER’S SOLE AND EXCLUSIVE WARRANTY WITH RESPECT TO THE SERVICES. THE SERVICE PROVIDER DOES NOT MAKE ANY OTHER WARRANTIES, WHETHER EXPRESS OR IMPLIED, AND SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES, WHETHER OF MERCHANTABILITY, SUITABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR OTHERWISE FOR SAID SERVICES OR ANY WARRANTIES AT ALL WITH RESPECT TO ADDITIONAL SERVICES OR SPECIALIZED TRANSITION-OUT SERVICES. ANY REPRESENTATION OR WARRANTY IN RESPECT OF ANY ADDITIONAL SERVICE OR SPECIALIZED TRANSITION-OUT SERVICE SHALL BE INCLUDED IN THE WRITTEN AGREEMENT SETTING FORTH THE TERMS OF SUCH ADDITIONAL SERVICE OR SPECIALIZED TRANSITION-OUT SERVICE.

8. INCIDENTAL & CONSEQUENTIAL DAMAGES

NOTWITHSTANDING ANY PROVISION OR REPRESENTATION TO THE CONTRARY, EACH OF THE SERVICE PROVIDER AND THE SERVICE RECIPIENT SHALL ONLY BE LIABLE FOR DIRECT DAMAGES, WHICH FOR THE AVOIDANCE OF DOUBT SHALL EXCLUDE ANY INCIDENTAL, CONSEQUENTIAL, PUNITIVE, OR INDIRECT DAMAGES, INCLUDING, WITHOUT LIMITATION, ANY LOSS OF PROFITS, LOSS OF USE, DOWNTIME, OR LOSS OF SALES FOR ANY BREACH OF THIS AGREEMENT.

9. FORCE MAJEURE

9.1.

The Service Provider shall not be responsible for failure or delay in delivery of any Service that it has responsibility for providing hereunder, nor shall the Service Recipient be responsible for failure or delay in receiving such Service, if caused by an act of God or public enemy, war, government acts, regulations or orders, fire, flood, embargo, quarantine, epidemic, labor stoppages or other disruptions, accident, unusually severe weather, or other similar cause beyond the control of the defaulting Party, provided that such Party shall have, promptly after knowledge of the beginning of any excusable delay, notified the other Parties of such delay, the reason therefor, and the probable duration and consequence thereof. The Party so excused shall use commercially reasonable efforts to resume performance of its obligations hereunder with the least possible delay.

9.2.

In the event that the Service Provider is excused from supplying a Service pursuant to Section 9.1, the Service Recipient shall be free to acquire replacement services from a third-party at the Service Recipient’s expense, and without liability to Seller, for the period and to the extent reasonably necessitated by such non-performance, or until notice is provided by the Service Recipient that it no longer desires to purchase such Service from the Service Provider, whereupon such Service shall be terminated.

10. INSURANCE

10.1.

Each Party shall, throughout the term of this Agreement, carry appropriate insurance with a reputable insurance company covering property damage, business interruptions and general liability insurance (including contractual liability) to protect its own business and property interests. To the extent either Party insures, in whole or in part, through a plan of self-insurance, the Parties acknowledge that such self-insurance will be acceptable for purposes of this Agreement.

11. CONFIDENTIALITY OF INFORMATION

11.1.

Except as provided below, all data and information disclosed between the Service Provider and the Service Recipient pursuant to this Agreement, including information relating to or received from third-parties and any Service Recipient Data and all Personally Identifiable Information (“PII”) (e.g., employee social security numbers, dates of birth, etc.) are deemed confidential (“Confidential Information”). A Party receiving Confidential Information (the “Receiving Party”) will not use such information for any purpose other than for which it was disclosed and, except as otherwise permitted by this Agreement, shall not disclose to third-parties any Confidential Information for a period of five (5) years from the termination or expiration of this Agreement, except for PII which will remain confidential. Except for PII, the Receiving Party’s obligation hereunder shall not apply to information that:

is already in the Receiving Party’s possession at the time of disclosure thereof;

is or subsequently becomes part of the public domain through no action of the Receiving Party;

(c)

is subsequently received by the Receiving Party from a third-party which has no obligation of confidentiality to the Party disclosing the Confidential Information; or

(d)

information developed or provided by the Service Provider to be used by the Service Receiver in the ordinary course of business.

11.2.

Notwithstanding Section 11.3, Confidential Information may be disclosed by the Receiving Party:

to the Receiving Party’s affiliates, directors, officers, employees, agents (including, in the case of the Service Provider, any third-parties engaged to provide the Services), auditors, consultants and financial advisers (collectively, “Agents”), provided that the Receiving Party ensures that such Agents comply with this Section 11.2; and

as required by applicable law, provided that, if permitted by law, written notice of such requirement shall be given promptly to the other Party so that it may take reasonable actions to avoid and minimize the extent of such disclosure, and the Receiving Party shall cooperate with the other party as reasonably requested by the other Party in connection with such actions.

11.3.

If, at any time, either Party determines that the other Party has disclosed, or sought to disclose, Confidential Information in violation of this Agreement, that any unauthorized personnel of the other Party has accessed Confidential Information, or that the other Party or any of its personnel has engaged in activities that may lead to the unauthorized access to, use of, or disclosure of such Party’s Confidential Information, such Party shall immediately terminate any such personnel’s access to the Confidential Information and immediately notify the other Party. In addition, either Party shall have the right to deny personnel of the other Party access to such Party’s Confidential Information upon notice to the other Party in the event that such Party reasonably believes that such personnel pose a security concern. Each Party will cooperate with the other Party in investigating any apparent unauthorized access to or use of such Party’s Confidential Information. No interruption of the provision of Services hereunder as a result of any denial or termination of access by the Service Recipient pursuant to this Section 11.3 (other than in the case of a breach by the Service Provider of Section 11.1 (as finally determined after resolution of all disputes)) shall be deemed a breach of Service Provider’s obligations under this Agreement.

12. TERMINATION

12.1.

This is a master agreement and shall be construed as a separate and independent agreement for each and every Service provided under this Agreement. Any termination of this Agreement with respect to any Service shall not terminate this Agreement with respect to any other Service then being provided pursuant to this Agreement.

12.2.

Upon thirty (30) days’ written notice, the Service Provider may terminate this Agreement with respect to any Service that it provides hereunder or, at its option, suspend performance of its obligations with respect thereto, in either case in the event of the failure of the Service Recipient to pay any invoice within forty-five (45) days of the receipt of such invoice or upon any other material breach by the Service Recipient of this Agreement with respect to such Service, unless the Service Recipient is disputing the invoice in good faith or the Service Recipient shall have paid the invoice or cured such breach within the 30-day notice period.

12.3.

Any one or more of the Services may be terminated (a) upon mutual agreement of the Parties or (b) at the Service Recipient’s option (i) at the end of a Seller fiscal month upon thirty (30) days’ written notice to the Service Provider prior to the end of such Seller fiscal month, provided that the terminated Services are not required to be performed by the Service Provider in order to perform other Services under this Agreement, and (ii) pursuant to Section 9.2. All accrued and unpaid charges for Services shall be due and payable upon termination of this Agreement with respect to such Services.

12.4.

Following and prior to the termination of any Service, each Party shall cooperate in good faith with the other to transfer to Purchaser all records and take all other actions necessary to provide Purchaser and its successors and assigns with sufficient information in the form reasonably requested by Purchaser, or its successors and assigns, as the case may be, to make alternative service arrangements (including internal arrangements) substantially consistent with those contemplated by this Agreement.

13. EMPLOYEES

Seller will use commercially reasonable efforts to ensure that qualified personnel will be assigned to perform the Services.

14. RELATIONSHIP OF PARTIES

In providing the Services, Seller is acting as and shall be considered an independent contractor. Except as expressly set forth herein, no Party has the authority to, and each Party agrees that it shall not, directly or indirectly contract any obligations of any kind in the name of or chargeable against any of the other Parties without such Party’s prior written consent.

15. PROJECT MANAGERS; ESCALATION

15.1.

The Service Provider and the Service Recipient will each assign one person to act as that Party’s project manager (the “Project Manager”) for each of Human Resources, Information Technology and Finance (and other categories, as may be agreed by the Parties). The Project Manager will (i) represent and act for their respective Party for matters related to the applicable Service, and (ii) meet and/or confer on a regular basis (at mutually agreed times and locations) to review the activities under this Agreement and to discuss the status and progress of such activities. All disputes or issues arising hereunder will be referred to the applicable Project Managers for resolution. In the event any such dispute or issue is not resolved in a timely manner, such matter will be referred to senior management representatives, with appropriate decision making authority for prompt resolution of the matter. If still not resolved, the issue will be escalated to the Service Recipient’s Lead Representative and the Service Provider’s Lead Representative for resolution. The Service Recipient’s Lead Representative will initially be Xxxxxx Xxxxxx and the Service Provider’s Lead Representative will initially be Xxxxxxx Xxxx. Either Party may designate a different individual as its Lead Representative at any time by delivering written notice to the other Party. The foregoing shall not in any way limit the rights of the Parties to pursue any other legal and equitable remedies available to them hereunder in the event of a breach of this Agreement.

15.2.

The Service Provider will promptly notify the Service Recipient of any reassignments or change in contact information of the Project Manager or other key personnel identified in the Schedules.

15.3.

The Parties agree to use good faith efforts to resolve any controversy or claim arising out of this Agreement, the interpretation of any of the provisions hereof, or the actions of the Parties hereunder. Other than in the case of a dispute relating to Section 2.6 hereto, in the event of a breach of this Agreement, or a dispute as to the meaning of this Agreement, or any of its terms which the Parties cannot resolve by themselves amicably, the Parties agree to expeditiously submit such dispute to resolution in the following manner.

(i)

The Parties shall endeavor to resolve the dispute as contemplated in Section 15.1.

(ii)

If within thirty (30) days after one Party notifies the other in writing of the existence of a dispute, either Party may, at its option, provide written notice of the intent to arbitrate. Arbitration shall be according to the rules of the American Arbitration Association, except as herein modified by the Parties or otherwise as agreed to by the Parties. Within ten (10) days of receipt of such notice of intent to arbitrate, each Party will select an arbitrator, and notify the other Party of its selection. Within fifteen (15) days after such notice, the respective arbitrators will select a third arbitrator. All such arbitrators shall have experience in the Business, as defined in the Purchase Agreement. A hearing by the arbitration panel must be held within thirty (30) days after the selection of the Chairman and a majority decision of the panel and resolution must be reached within thirty (30) days of such hearing. 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.

(iii)

The arbitration proceedings will be held in Portland, Oregon, unless the Parties agree to a different location. All negotiation and arbitration proceedings will be confidential and will be treated as compromise and settlement negotiations for purpose of all rules of evidence. Each Party shall bear its own cost of presenting its case, and one-half of the cost incurred by the arbitration panel, or any mediation or alternative dispute resolution procedure, as the case may be.

(iv)

Nothing in this Section 15 shall supersede the notice/cure and termination rights of the Parties otherwise set forth in this Agreement.

16. ASSIGNMENT AND DELEGATION

16.1.

This Agreement and all of the provisions hereof shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned or delegated, directly or indirectly, in whole or in part, including, without limitation, by operation of law, by any party hereto without the prior written consent of the other Parties hereto; provided, however, that (i) the Service Provider may assign or delegate this Agreement, in whole or in part, to any of its affiliates but in no event shall such assignment release the Service Provider from its obligations hereunder, (ii) the Service Provider may assign this Agreement to an entity which has succeeded to all or substantially all of its assets, so long as such Party assumes all of the Service Provider’s obligations in writing, (iii) the Service Recipient may collaterally assign its rights without consent to any Person providing financing related to the transactions contemplated by the Purchase Agreement, (iv) the Service Recipient may assign or delegate this Agreement, in whole or in part, to any of its affiliates but in no event shall such assignment release the Service Recipient from its obligations hereunder, and (v) the Service Recipient may assign this Agreement to an entity which has succeeded to all or substantially all of the Business, so long as such Party assumes all of the Service Recipient’s obligations in writing.

16.2.

In the event the Service Recipient transfers a portion of the Transferred Assets to a third-party, nothing in this Agreement shall prohibit the Service Recipient from passing through that portion, if any, of the Services relating to such Transferred Assets to such third-party that may be reasonably feasibly passed through without violation of law or any agreement between either Party and a third-party, including any third-party outsourcer so long as (i) no change to the then-current Services, including the volume or manner of delivery, is required of the Service Provider, (ii) the Service Provider is not required to incur any additional costs to provide the Services and (iii) the Service Recipient agrees to indemnify the Service Provider and its affiliates and its and their respective officers, directors, shareholders, employees and agents harmless from any damages, loss, cost or liability (including reasonable legal fees and expenses and the cost of enforcing such indemnity) arising out of or resulting from such pass-through of Services. In no event shall any such pass-through extend the term of this Agreement.

17. NOTICES

All notices, requests, claims, demands, waivers and other communications under this Agreement shall be in writing and shall be deemed given (a) five (5) Business Days following sending by registered or certified mail, postage prepaid, (b) when sent, if sent by facsimile or other electronic transmission, provided that the facsimile or other electronic transmission is promptly confirmed by telephone, (c) when delivered, if delivered personally to the intended recipient and (d) one Business Day following sending by overnight delivery via a courier service that is nationally recognized in the United States and, in each case, addressed to a Party at (x) in the case of invoices, requests for consents under Section 2.8 and other operating notices, to the following address for such Party:

if to Seller, to

[SELLER] Company

00000 Xxxx Xxx Xxxxx

Attention: Xxxxxxx Xxxx

Attention: General Counsel

Xxxxx Xxxxxxxxxx X/X XX 0X00

Xxxxxxxxx: [●]

if to Purchaser, to

[●]

Attention: Xxxxxx Xxxxxx

and (y) in all other cases, to the following address for such Party:

if to Seller, to

[SELLER] Company

00000 Xxxx Xxx Xxxxx

Attention: General Counsel

Xxxxx Xxxxxxxxxx X/X XX 0X00

or to such other address(es) as shall be furnished in writing by any such Party to the other Party hereto in accordance with the provisions of this Section 17.

18. INTEGRATED AGREEMENT; MODIFICATION; NO THIRD-PARTY BENEFICIARIES

This Agreement constitutes the entire agreement and understanding of the Parties with respect to the subject matter hereof and supersedes all prior discussions, negotiations, understandings and agreements. It is intended by the Parties as a complete and exclusive statement of the terms of their agreement with respect to the subject matter hereof. This is a fully integrated agreement. Each Party acknowledges that the other has made no representation or warranty, and that it has relied on no representation or warranty, other than those specifically set forth in this Agreement. This Agreement may not be modified except in a writing signed by the Parties. This Agreement is not intended to confer upon any Person other than the Parties any rights or remedies.

19. GOVERNING LAW, ETC.

This Agreement shall be governed by, and construed in accordance with, the Laws of the State of New York, regardless of the Laws that might otherwise govern under applicable principles of conflicts of laws thereof.

20. AMENDMENT

This Agreement may not be amended except by an instrument in writing signed on behalf of each of the Parties.

21. RECORDS INSPECTION

21.1.

Without limiting the obligations of the Parties under Section 6.02 of the Purchase Agreement:

during the term of this Agreement and for a period of six (6) months thereafter, the Service Provider shall maintain true and accurate books and records of account containing full, true and correct entries of the charges for, and all costs and expenses incurred by it in connection with, providing the Services for which it is responsible hereunder; and

the Service Recipient shall have the right upon request to inspect or cause to be inspected, and to make copies of, the books and records of the Service Provider relating to the Services provided by the Service Provider, including without limitation the calculation of the invoices relating thereto. The Service Provider shall keep and maintain such records relating to the Services that it keeps for itself (to the extent they relate to the Services) with respect to the Business prior to the Closing.

21.2.

Upon the termination of a Service with respect to which the Service Provider holds books, records, files, databases or computer software or hardware (including, but not limited to, current and archived copies of computer files) owned by the Service Recipient, and used in connection with the provision of a Service (the “Materials”), the Service Provider will return all such Materials promptly upon termination, but not later than thirty (30) days after such termination.

21.3.

The Service Recipient Data shall be and shall remain the property of the Service Recipient and, to the extent reasonably practicable shall be promptly provided by the Service Provider upon the Service Recipient’s request. The Service Provider shall only use the Service Recipient Data to provide the Services to the Service Recipient as set forth herein and for no other purpose whatsoever.

21.4.

Notwithstanding anything herein to the contrary, the Service Provider may retain copies of the Materials and the Service Recipient Data in accordance with policies and procedures implemented by the Service Provider in order to comply with applicable law, regulation, professional standards or reasonable business practice, including document retention policies.

22. SOFTWARE AND APPLICATIONS USED IN CONNECTION WITH SERVICES

22.1.

With respect to software or applications that may be required, if at all, to provide Services under this Agreement, Service Provider shall use commercially reasonable efforts to expediently seek any consent from third-party licensors if and to the extent required for Service Provider to provide, or for Service Recipient to receive and use, the Services provided under this Agreement. In the event Service Provider is unable to obtain any such consent, Service Provider and Service Recipient shall work together in good faith as they deem appropriate to make reasonable alternative arrangements. To the extent prohibited by its agreements with third-party licensors, Service Provider will not be required hereunder to act as a “software service bureau” or provide “software as a service” for the Service Recipient. The internally-allocated costs incurred by each Party under this Section 22.1 shall be for the account of such Party. Except as contemplated by the Purchase Agreement, any out-of-pocket expenses (including attorneys’ fees) and fees paid to third parties by either Party in connection with obtaining the required consents pursuant to this Section 22.1 shall be deemed to be One Time Costs to be shared by the Parties on a 50/50 basis; provided, however, that such fees shall be for the account of Service Recipient to the extent they relate to consents permitting Service Recipient to use such software or application on a going-forward basis after the Services to which such software or application relates are terminated under this Agreement. Costs described in the proviso to the preceding sentence that are incurred by Seller shall be included in (i) the first Monthly Estimated Charge invoice, if incurred prior to the date of such invoice, or (ii) the Actual Quarterly Charges invoice relating to the Reference Quarter in which such costs are incurred.

22.2.

Any modifications or configurations made to software (including, but not limited to, scripts, applications and source code) by the Service Provider in connection with the Services during the Transition Period shall be owned by Service Provider and licensed to Service Recipient on a perpetual, fully paid-up, royalty free, worldwide, non-exclusive basis. Any modifications or configurations made to software (including, but not limited to, scripts, applications and source code) by the Service Recipient in connection with the Services during the Transition Period shall be owned by Service Recipient and, to the extent such modifications or configurations are incorporated into the systems of Service Provider during the Transition Period, licensed to Service Provider on a perpetual, fully paid-up, royalty-free, worldwide, non-exclusive basis.

23. INTERPRETATION

Each Party acknowledges that it and its legal counsel have reviewed this Agreement. The Parties agree that the terms and conditions of this Agreement shall not be construed against any Party on the basis of such Party’s drafting of such terms and conditions. The words “herein”, “hereto” and other similar words shall mean this Agreement as a whole, including the exhibits hereto, as the same may be amended, modified or supplemented from time to time.

24. NO AGENCY

The Parties agree that no agency, partnership or joint venture of any kind shall be or is intended to be created by or under this Agreement.

25. HEADINGS

The headings in this Agreement are for convenience only and are not intended and will not be construed to affect the scope or meaning of any provisions hereof.

26. COUNTERPARTS

This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the Parties hereto and delivered to the other Parties.

27. SURVIVAL

The Parties’ rights and obligations under Articles 6, 7, 8, 11, Section 12.4, Articles 15 through 21, Section 22.2 and this Article 27 shall survive expiration or termination of this Agreement.

[Signatures on the following page.]

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

SELLER

By:
	Name:
	Title:

PURCHASER

By:
	Name:
	Title:

Annex A

Principles for One Time Costs under the Transition Services Agreement

Annex B

[to come]

Schedule A to the Transition Services Agreement - Information Technology

Schedule B to the Transition Services Agreement - HR / Payroll

Schedule C to the Transition Services Agreement

Finance and Administration

Exhibit G-1

FORM OF PULPWOOD SUPPLY AGREEMENT

BY AND BETWEEN

[BUYER] (“BUYER”)

AND

[SELLER] COMPANY (“SELLER”)

INDEX

PARAGRAPH	PAGE
1. Definitions	1
2. Term	3
3. Volumes	3
4. Specifications	4
5. Price	4
6. Delivery, Scaling and Weighing	5
7. Default; Limitation of Damages	7
8. Payment	8
9. Termination/Partial Termination	8
10. Assignment	8
11. Independent Contractor Status	10
12. Indemnity	10
13. Attorneys’ Fees and Costs	10
14. Management Obligation	10
15. Insurance	11
16. Warranty and Taxes	11
17. Compliance with Laws, Rules and Regulations	11
18. Force Majeure	11
19. Succession	13
20. Notices	13
21. Dispute Resolution	14
22. Confidentiality	15
23. Sale of Timberlands	15
24. Complete Contract	15
25. Governing Law	16
26. Recordation	16
27. Right to Access and Audit	16
28. Further Assurances	16
29. Electronic Transaction	16
30. Severability	16
31. Counterparts	16
32. Captions	16

SCHEDULES

Schedule 1 Committed Volume

Schedule 2 Specifications

Schedule 3 F2M Data

Schedule 4 Freight Adjustment Table

EXHIBITS

Exhibit A The Arkansas/Oklahoma Timberlands Block

Exhibit B The North Louisiana Timberlands Block

Exhibit C The Pine Hill Timberlands Block

(v) In the event of a Buyer Change Event resulting from the sale of a Transferred Mill, BUYER may transfer all or substantially all of its rights and obligations under this Contract relative to the related Wood Reduction, together with the ownership of a Transferred Mill, provided such transferee (“New Buyer”) (x) has the financial and operational resources and capacity to operate the Transferred Mill and to meet the obligations of BUYER hereunder and (y) assumes in writing all of BUYER’S duties and obligations hereunder arising after such Transfer. Upon such assumption in writing by such New Buyer of BUYER’S duties and obligations hereunder relative to the Wood Reduction applicable to the Transferred Mill being sold, BUYER shall be released from all such future obligations hereunder, and SELLER shall thereafter look only to such New Buyer for such future performance under this Contract. BUYER shall provide SELLER with written notice of any such proposed transfer not less than sixty (60) days prior to the transfer, which notice shall include reasonably detailed information concerning the financial capacity and experience of the New Buyer, and shall provide such other information as SELLER may reasonably request. SELLER shall make any objection that such transfer does not comply herewith not later than twenty (20) days after SELLER’S receipt request of such notice.

INTERNATIONAL PAPER COMPANY, a New York corporation (“BUYER”) with an address at 0000 Xxxxxx Xxx., Xxxxxxx, Xxxxxxxxx 00000, and [SELLER] Company, a Washington company (“SELLER”) with an address at 33663 [SELLER] Way South, Federal Way, WA 98003, do enter into and execute this Pulpwood Supply Agreement (this “Contract”) as of this ____ day of _______________, 2008.

RECITALS

WHEREAS: Pursuant to a Purchase Agreement dated as of [·], 2008 (the “Purchase Agreement”) between SELLER and BUYER, Seller will sell to Buyer certain assets and equity interests and assume certain liabilities in exchange for the purchase price;

WHEREAS: SELLER owns or leases certain timberlands more particularly described in Exhibits A, B and C (“the Timberlands”);

WHEREAS: BUYER is desirous of acquiring, and SELLER is desirous of providing, Pulpwood (as defined herein) from the Timberlands, for use for a period of years in the Transferred Xxxxx (as defined herein), the Alternative Buyer Xxxxx (as defined herein) and such other alternative facilities, locations or end-users in accordance with this Contract;

NOW, THEREFORE, in consideration of the foregoing and the terms and conditions set forth herein and other good and valuable consideration, the parties hereto agree as follows:

1. Definitions:

When used in this Contract, the words and phrases set forth below shall have the following meanings:

“Affiliate” of any Person means another Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first Person. As used herein, “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such entity, whether through ownership of voting securities or other interests, by contract or otherwise.

b.	“Alternative Buyer Xxxxx” means the following of BUYER’s Xxxxx: Mansfield, LA; Texarkana, TX; Selma, AL; Cantonement, FL; Bastrop, LA; Prattville, AL; and Pineville, LA.

c.	“Alternative Other Xxxxx” means any Delivery Point other than Transferred Xxxxx and Alternative Buyer Xxxxx.

d.	“Annual Harvest Volume” means the volume of each Product Seller harvests during a Harvest Year with respect to each Timberlands Block.

e.	“Annual Pulpwood Harvest Plan” means the annual harvest plan for Pulpwood established from year to year for each Timberlands Block, as described in paragraph 3(b).

f.	“Business Day” means any day on which commercial banks are generally open for business in the states in which the Transferred Xxxxx are located, other than a Saturday, a Sunday or a day observed as a holiday in such states.

“Committed Volume” means the volume of Pulpwood from the Timberlands that SELLER is required to deliver to BUYER and BUYER is required to purchase pursuant to paragraph 3(a), which volume is equal to the lesser of the Maximum Committed Volume and the Annual Harvest Volume, as set forth in Schedule 1.

h.	“Delivery Plan” means the annual and quarterly delivery schedules as described in paragraph 6.

i.	“Delivery Point” means the location at which the Wood is delivered by SELLER, as shall be designated by BUYER in accordance with paragraph 6.

j.	“Effective Date” means ___, 2008.

k.	“Ending Date” means March ___, 2023.

l.	“Excess Volume” means, with respect to a given Timberlands Block, the Annual Harvest Volume in excess of the Maximum Committed Volume to be delivered to the corresponding Transferred Mill.

“Harvest Year” means a calendar year beginning on January 1 and ending on December 31. The first full “Harvest Year” of this Contract shall begin on January 1, 2009 and end on December 31, 2009. The periods from the Effective Date to December 31, 2008 and from January 1, 2023 to the Ending Date shall be deemed partial “Harvest Years.”

n.	“Long Term Leases” means those long term leases pursuant to which SELLER has interest in certain timberlands as described on Exhibits A, B and C.

o.	“Maximum Committed Volume” means the maximum volume SELLER is required to deliver to BUYER and BUYER is required to purchase from SELLER, as set forth in Schedule 1.

p.	“Person” means an individual, a general or limited partnership, a corporation, a trust, a joint venture, an unincorporated organization, a limited liability entity, any other entity and any governmental entity.

q.	“Product” means the products set out in Schedule 1.

r.	“Pulpwood” means logs or segments of logs (other than saw logs, veneer logs or similar or higher grade log products) that can be chipped, shredded, flaked, ground, or otherwise converted to make pulp, paper, or composite panel products.

s.	“Term” means the period of time from and including the Effective Date through and including the Ending Date as described in paragraph 2.

t.	“Termination Date” means the date of termination of this Contract in accordance with its terms by BUYER or SELLER at any time other than the Ending Date.

“Timberlands” means those lands that SELLER owns in fee or has leasehold interest in Long Term Leases, as more particularly described on Exhibits A, B and C. It is understood and agreed that Exhibits A, B and C represent SELLER’S current ownership of the Timberlands, and such Exhibits may be modified by mutual agreement of the parties or as otherwise provided in this Contract.

“Timberlands Block” means the portion of the Timberlands set forth in Exhibit A (the “Arkansas/Oklahoma Timberlands Block”), Exhibit B (the “North Louisiana Timberlands Block”) and Exhibit C (the “Pine Hill Timberlands Block”). Each Timberlands Block is associated with a corresponding Transferred Mill. The Arkansas/Oklahoma Timberlands Block is associated with the Valliant Transferred Mill. The North Louisiana Timberlands Block is associated with the Red River Transferred Mill and the Pine Hill Timberlands Block is associated with the Pine Hill Transferred Mill.

w.	“Transfer” means with respect to the Timberlands, any direct or indirect transfer, sale, assignment, pledge, hypothecation or other disposition of ownership or control thereof.

x.	“Transferred Xxxxx” means the xxxxx located in Oklahoma (the “Valliant Transferred Mill”), North Louisiana (the “Red River Transferred Mill”) and Alabama (the “Pine Hill Transferred Mill”).

y.	“Wood” means Committed Volume and Contracted Option Volume.

z.	“Yard Transactions” means mill deliveries from a xxxxxxxx system.

2. Term:

Unless sooner terminated as hereinafter provided, the Term of this Contract shall commence on the Effective Date and extend for fifteen (15) years, ending on the Ending Date.

3. Volumes:

(a) During the Term, BUYER covenants and agrees to purchase and accept from SELLER and SELLER covenants and agrees to sell and deliver to BUYER, as specified in the Delivery Plan for the prices set out herein and at the times hereinafter provided, the Committed Volume of Product for each Harvest Year as set out in Schedule 1.

(b) SELLER shall provide to BUYER no later than October 1 of the year preceding the Harvest Year a written Annual Pulpwood Harvest Plan for such Harvest Year detailing, for each Product, the planned harvest volume and such other information as may be reasonably required by BUYER for the purpose of creating the Delivery Plan, including general locations of Pulpwood to be harvested for the planned harvest volume. BUYER and SELLER shall mutually agree upon the Delivery Plan for each Harvest Year in accordance with the provisions of paragraph 6, provided that the parties shall use their best efforts to reach agreement within forty-five (45) days. In the event the Annual Harvest Volume for any Product for any Timberlands Block during any Harvest Year is less than the Maximum Committed Volume, as set forth in Schedule 1, for the corresponding Transferred Mill, SELLER shall provide BUYER with (i) documentation that is reasonably acceptable to BUYER for the basis of such shortfall and (ii) such reasonable assurances as BUYER shall request that SELLER is not selling such Products to third parties from the applicable Timberlands Block during such Harvest Year.

(c) BUYER shall have a right of first offer to purchase all or part of the Excess Volume for any Product for the upcoming Harvest Year during the Term by notifying SELLER in writing of such offer no later than November 15 of the year preceding such Harvest Year. Such notice shall specify the desired volume of each Product and the price offered by BUYER for such volume. Upon receipt of such notice, SELLER shall have fifteen (15) days to inform BUYER in writing of its acceptance or rejection of BUYER’S offer for such volume (the “Contracted Excess Volume”).

(d) SELLER agrees to deliver the Annual Harvest Volume for 2008, pro rated for the period of time remaining in the calendar year following the Effective Time.

(e) The parties will work together to effectuate a smooth and orderly transition and continual and even wood flow to BUYER.

4. Specifications:

All Wood must conform to the current specifications that apply for the Transferred Xxxxx (the “Wood Specifications”) as described in Schedule 2, which current specifications shall not materially differ from the specifications in place for the Transferred Xxxxx during the 2007 calendar year. BUYER may propose to modify the Wood Specifications upon sixty (60) days’ advance written notice to SELLER. SELLER will make a good faith effort to implement any proposed change to the Wood Specifications that does not require a capital expenditure. In the event the parties are unable to agree on such a change, BUYER may continue to accept Wood in accordance with the then current Wood Specifications or the parties may mutually agree to terminate this Contract. BUYER has the right in its reasonable discretion to reject any or all Wood not meeting the Wood Specifications at the time of delivery, provided that BUYER shall not reject a load of Wood after it has been unloaded. Wood rejected for failure to meet the Wood Specifications shall not be included in calculating whether SELLER has met its Committed Volume requirement.

5. Price:

Pricing for all Products shall be on a delivered basis as set forth herein.

(a) From the Effective Date until the first anniversary of the Effective Date, pricing for Pulpwood from the Committed Volume delivered to any of the Transferred Xxxxx shall be calculated as follows:

(i) Pricing for Products delivered to each Transferred Mill shall be equal to the previous calendar quarter’s weighted average delivered cost from Forest2Market (“F2M”) for Products purchased from the counties comprising the F2M market area identified for such Transferred Mill as set forth on Schedule 3.

(ii) Secondary freight from Yard Transactions and administrative costs such as procurement expenses shall be excluded from F2M’s weighted average delivered cost for the Products. This calculation, which shall establish the price to be paid to SELLER for Products for the upcoming quarter, shall be effective on the Tuesday of the week following publication of the quarterly F2M data.

(b) From the first anniversary of the Effective Date until the Ending Date, pricing for Pulpwood from the Committed Volume delivered to any of the Transferred Xxxxx shall be calculated as follows:

(i) The parties shall meet no later than thirty (30) days prior to the start of each calendar quarter to negotiate delivered prices for each Product to be delivered during the quarter to meet the Delivery Plan. The parties shall negotiate in good faith to mutually agree upon fair market pricing. In the event an agreement on pricing has not been reached within fifteen (15) days, pricing shall be determined in accordance with the dispute resolution process set out in paragraph 21(c) below. SELLER shall be obligated to continue to deliver, and BUYER shall be obligated to accept, Products pending the resolution of quarterly pricing. During such period as pricing is undetermined, BUYER shall pay SELLER for such delivered Products at the previous quarterly price. Upon completion of the arbitration process set out in paragraph 21(c), BUYER shall add or deduct from the next scheduled payment to SELLER such amounts of over or under payment that may be applicable.

(ii) For the purposes of the initial fair market pricing negotiation between the parties, the parties shall meet no later than thirty (30) days prior to the first anniversary of the Effective Date, and shall negotiate to reach a fair market price for the remainder of the calendar quarter in which the first anniversary falls in accordance with the principles and procedures set forth in subparagraph (i) above. If mutually agreed upon by the parties, such negotiated price may be extended to apply to the subsequent calendar quarter.

(d) BUYER and SELLER shall agree on standardized information and documentation to support the calculations described in this paragraph 5, and BUYER shall provide such information and documentation to SELLER on a quarterly basis.

(e) In accordance with paragraph 6, BUYER may designate an Alternative Buyer Mill or an Alternative Other Mill for Products from a given Timberlands Block, provided that pricing for any Product delivered to any alternative Delivery Point shall be equal to the price that would have applied to such Product if it had been delivered to the corresponding Transferred Mill, plus or minus any freight differential associated with delivery of the Product to such Alternative Buyer Mill or Alternative Other Mill as shown on the Freight Adjustment Table set forth on Schedule 4 (such table to be reviewed and adjusted annually by the parties).

6. Delivery, Weighing and Unloading:

(a) The parties recognize a mutual benefit to produce and accept Wood, other than hardwood, on an even flow basis, with appropriate consideration given to weather limitations on harvesting and trucking, and mill inventory constraints. BUYER and SELLER shall work together to develop annual quarterly delivery schedules for each upcoming Harvest Year (the “Delivery Plan”) based on the parameters set out herein, which Delivery Plan shall be mutually agreed upon no later than forty-five (45) days prior to the beginning of such Harvest Year. The Delivery Plan shall set forth the Delivery Points and the Committed Volume to be delivered to each Transferred Mill, Alternative Buyer Mill and Alternative Other Mill. BUYER shall have the right to modify the Delivery Plan by redirecting any Committed Volume from the Delivery Points set forth in the Delivery Plan to any other Delivery Point, including any Transferred Mill, Alternative Buyer Mill or Alternative Other Mill, provided that prior to such modification, BUYER must obtain SELLER’s consent, such consent not to be unreasonably withheld. BUYER shall have reasonable rights of ingress and egress to the Timberlands as necessary during the annual planning process between BUYER and SELLER with respect to the Delivery Plan.

(b) SELLER shall use commercially reasonable efforts to proportion deliveries by season for the various products as mutually agreed to by the parties. Deliveries shall be dispatched on a relatively even flow basis within each quarter. 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 by SELLER, or quarterly acceptances of delivery by BUYER, may vary from the Delivery Plan by up to twenty percent (20%) of the quarterly plan, provided, however, that the annual variance does not exceed five percent (5%) of the annual Delivery Plan. If BUYER fails to accept five percent (5%) of the annual Delivery Plan or less at the end of any Harvest Year (“Buyer Variance”), BUYER shall not be in default hereunder, but SELLER shall be released from all future obligations hereunder with respect to the Buyer Variance for that Harvest Year. If SELLER fails to deliver five percent (5%) of the annual Delivery Plan or less at the end of any Harvest Year (“Seller Variance”) for any reason other than BUYER’S failure to accept such delivered volume, SELLER shall not be in default hereunder but shall be required, if requested by BUYER, to deliver such Seller Variance (the “Carryover Volume”) in the first quarter of the following Harvest Year, at a price equal to the average of the quarterly price for all quarters during the previous Harvest Year. Any deliveries in the following Harvest Year will first be counted towards meeting the Carryover Volume requirement. The parties shall work together 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.

(c) All Wood delivered hereunder by SELLER shall be weighed by BUYER, or its designee, upon delivery at the respective Delivery Points, which data shall be recorded by the weigher on weight tickets and such copies as may be required by SELLER. 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 Wood, shall also be included on the weight ticket or provided in such other format as may be reasonably requested by BUYER or SELLER.

(d) Notwithstanding anything herein to the contrary, it is understood and agreed that SELLER’s ability to supply Pulpwood under this Contract would be materially impaired in the event of an abnormal market curtailment causing a material reduction in the demand for grade logs (a “Seller Change Event”, and the amount of reduction in Pulpwood supply resulting from a Seller Change Event, a “Supply Reduction”). If a Seller Change Event occurs, SELLER shall not be in default and shall be released from all future obligations hereunder for such portion of the Supply Reduction.

(e) It is mutually understood and agreed that in the event of a Seller Change Event, SELLER shall treat BUYER as a preferred customer, such that SELLER shall not reduce its supply of Products to BUYER by more, on a percentage basis, than it reduces its supply of Products to other sources, and SELLER will use its best efforts to reduce its supply of Products to BUYER by less, on a percentage basis, than it reduces its supply of Products to other sources.

(f) If a federal or state entity provides written notice to BUYER of a deficiency with respect to BUYER’S weighing process, BUYER shall provide SELLER with written notice of such deficiency within seven (7) days of receipt of the notice from such federal or state entity.

(g) BUYER shall use commercially reasonable efforts to unload the Products from such trucks within a time period mutually agreed upon with SELLER for each Delivery Point, taking into account SELLER’s past practices.

(h) BUYER shall use commercially reasonable efforts to provide a safe weighing and unloading environment, and SELLER and its designees agree to adhere to BUYER’s yard safety requirements while on BUYER’s property.

7. Default; Limitation of Damages:

(a) A party shall be in default under this Contract if such party fails to comply with its obligations under this Contract in any material respect after written notice thereof (i) within a period of fifteen (15) days after such notice if compliance is commercially practicable within fifteen (15) days, or (ii) within a reasonable period after such written notice if compliance is not commercially practicable within fifteen (15) days and such party begins to comply within fifteen (15) days.

(b) In the event of a default in payment for delivered Pulpwood, SELLER’s remedy shall be limited to the unpaid contract price, together with such incidental damages, if any, as allowed by section 2-710 of the Uniform Commercial Code; provided, however, that (i) in the event BUYER fails to make any weekly payment when due hereunder and shall not have cured such failure within one (1) week of notice of such failure, SELLER may, during the continuation of any such failure, suspend deliveries of Pulpwood hereunder and (ii) if BUYER continues not to cure such failure within two (2) weeks of SELLER’s suspension of deliveries pursuant to subsection (i) herein, SELLER may terminate this Contract by written notice to BUYER. SELLER shall have no obligation to deliver at any later time any volume of Pulpwood related to suspended deliveries.

(c) Except as otherwise set forth herein, in the event of any default other than as set out in paragraph 7(b) above, the non-defaulting party’s damages shall be limited to the difference between the market or cover price and the unpaid contract price for the Wood as to which the other party is in default.

(d) SELLER acknowledges and agrees that BUYER would be damaged irreparably in the event SELLER failed to perform in particular under paragraphs 3 (Volumes), paragraph 14 (Management Obligations) and paragraph 23 (Sale of SELLER’S Rights in Timberlands) of this Contract and such nonperformance remained uncured after the time period set forth in paragraph 7(a). Accordingly, SELLER agrees that BUYER shall be entitled to enforce specifically such provisions of this Contract that provide for continued delivery of Products under the terms of the Contract 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 BUYER may be entitled at law or in equity, including incidental and consequential damages.

8. Payment:

Payments by BUYER to SELLER for Products shall be made in U.S. funds weekly no later than ten (10) days after delivery by SELLER and receipt and acceptance by BUYER (“Due Date”). Each calendar week shall begin on Tuesday at the opening for business at the Delivery Point (or whenever thereafter first opened for business) and shall end at the close of business of the Delivery Point on Monday of each week (or whenever previously closed for business for that week). All payments shall be made on or before the Due Date by initiating a wire or electronic transfer to an account designated by SELLER in time for the payment to be received by SELLER’S bank on or before the close of business of SELLER’S bank on the Due Date. Should the Due Date fall on a day in which SELLER’S bank is closed, the Due Date shall be extended until the next business day SELLER’S bank is open for business. SELLER shall have access to detailed delivery and payment information similar to such information provided to other suppliers of BUYER. SELLER shall have the right to change its payment account by giving ten (10) days notice to BUYER.

9. Termination/Partial Termination:

(a) The parties may terminate this Contract by mutual consent.

(b) Notwithstanding anything herein to the contrary, it is understood and agreed that BUYER’S Pulpwood usage requirements would be greatly diminished in the event of (i) a closing of a Transferred Mill or an operating line within a Transferred Mill, (ii) a change in the species of Pulpwood used by BUYER at a Transferred Mill, (iii) the sale of a Transferred Mill, or (iv) a material decrease in BUYER’S requirements for Pulpwood as a result of a material change of manufacturing process (each of the foregoing, a “Buyer Change Event”, and the amount of reduction in Pulpwood usage resulting from a Buyer Change Event, a “Wood Reduction”). If a Buyer Change Event occurs and BUYER has not redirected the Wood Reduction amount to another Delivery Point within thirty (30) days of such Buyer Change Event, BUYER or SELLER may, at its option and upon at least sixty (60) days prior written notice to the other party, terminate its rights and obligations under this Contract as it relates to all or a portion of the Wood Reduction, and BUYER and SELLER shall be released from all future obligations hereunder for such portion of the Wood Reduction, provided, however, that SELLER shall have no termination right with respect to a Wood Reduction that SELLER refused to allow to be redirected under this paragraph. In the event of a Buyer Change Event, BUYER may redirect the Wood Reduction amount to another Delivery Point with the prior written consent of SELLER, which consent shall not be unreasonably withheld.

(c) It is mutually understood and agreed that in the event of a Buyer Change Event, BUYER shall treat SELLER as a preferred supplier, such that BUYER shall not reduce its demand for Products from SELLER by more, on a percentage basis, than it reduces its demand for Products from other sources, and BUYER will use its best efforts to reduce its demand for Products from SELLER by less, on a percentage basis, than it reduces its demand for Products from other sources.

10. Assignment:

(a) Except as otherwise provided herein, neither party may assign this Contract without the prior written consent of the other party. Upon any assignment permitted hereunder (i) all of the terms and provisions of this Contract binding upon, or inuring to the benefit of, the assigning party shall be binding upon, and inure to the benefit of, its successor or assign, provided, however, the assignee shall assume in writing the obligations of the assigning party, and (ii) the assigning party shall be released from all further obligations hereunder, and the other party shall thereafter look only to such assignee for performance under this Contract.

(b) Notwithstanding the foregoing, the following assignments are permitted:

(i) SELLER may assign this Contract in the event SELLER Transfers all or substantially all of the Timberlands then owned by SELLER in a single transaction to a single transferee who shall as part of such transaction (1) assume all of SELLER’S obligations under this Contract and (2) have the financial and operational resources and capacity to meet the obligations of SELLER under this Contract.

(ii) SELLER may assign this Contract in the event SELLER designates an Affiliate of SELLER to serve as Manager/Operator of the Timberlands provided (1) such Affiliate assumes and agrees to become jointly and severally liable, with SELLER, for all of SELLER’s obligations under this Contract or (2) such Affiliate and SELLER enter into such separate agreements reasonably satisfactory to BUYER as shall be necessary to provide that (x) such Affiliate serving as Manager/Operator agrees to supply Pulpwood to BUYER and (y) SELLER agrees to provide such Affiliate with stumpage sufficient to permit such Affiliate to meet its obligations to supply Pulpwood with the result that BUYER shall be able to continue to purchase Product in the volumes, from the Timberlands and at the prices contemplated by this Contract.

(iii) For so long as the aggregate cumulative Transfers from the Timberlands measured from the date hereof does not exceed 50,000 acres (the “Transfer Threshold”), SELLER may Transfer a portion of the Timberlands below such amount in accordance with the provisions of this Contract. If the aggregate cumulative amount of Transfers from the Timberlands measured from the date hereof exceeds the Transfer Threshold or SELLER proposes to transfer in excess of 50,000 acres in a single transaction to a single purchaser, SELLER may Transfer such additional portions of the Timberlands only if SELLER either (1) certifies to BUYER in a manner reasonably acceptable to BUYER that such Transfer does not impair its ability to perform its obligations under this Contract, or (2) SELLER assigns a portion of this Contract in connection with such Transfer to a transferee with the financial and operational resources and capacity to meet the obligations of SELLER under this Contract and assumes in writing all of SELLER’s duties and obligations hereunder arising after such Transfer.

(iv) SELLER may Transfer (1) any portion of the Timberlands clear-cut of harvestable Pulpwood and unable to regenerate harvestable Pulpwood for the remaining term of the Contract and (2) any Long Term Lease that expires by its terms before the date it is included in the Annual Harvest Plan.

11. Independent Contractor Status:

No relationship of employer-employee or master and servant is intended, nor shall it be construed, to exist between BUYER and any other party, or between BUYER and any servant, agent, employee or supplier of any other party, by reason of this Contract. SELLER shall select and pay its own servants, agents, employees, and suppliers and neither SELLER, its servants, agents, employees nor its suppliers, shall be subject to any orders, supervision or control of BUYER.

12. Indemnity:

(a) BUYER shall indemnify, defend and hold harmless SELLER and its assignees, subcontractors, members, shareholders, directors, officers, managers, partners, employees, agents and consultants (collectively, “Seller Indemnitee”), from and against all claims and causes of action, pending or threatened, of any kind, 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, to the extent that such injury or damage results, directly or indirectly, from BUYER’S or its agents or subcontractors’ operations, performance or nonperformance under this Contract.

(b) SELLER shall indemnify, defend and hold harmless BUYER and its assignees, subcontractors, members, shareholders, directors, officers, managers, partners, employees, agents and consultants (collectively, “Buyer Indemnitee”), from and against all claims and causes of action, pending or threatened, of any kind, 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, to the extent that such injury or damage results, directly or indirectly, from SELLER’S or its agents or subcontractors’ operations, performance or nonperformance under this Contract

(c) In the event either party is entitled to be indemnified by the other, at the indemnitee’s request, the indemnitor shall afford a complete defense of any such claim, demand, cause of action or suit and shall bear all attorneys’ fees, costs of preparation and maintenance of the defense, all court costs and expert, discovery and investigative fees, and any associated appeal costs, to the end that the indemnitee shall incur no cost whatsoever as a result of such claim, demand, cause of action or suit, or ensuring compliance with this indemnity provision. The indemnitee expressly reserves the right to be represented by counsel of its own selection, at indemnitor’s expense. The exercise of indemnitee’s right to select its own attorneys will in no way detract from or release indemnitor from its obligation to indemnify and hold seller harmless hereunder.

13. Attorneys’ Fees and Costs:

In the event that any suit, action or other proceeding is instituted, pursuant to paragraph 21, by any of the parties hereto to enforce or interpret any of the terms or provisions of this Contract, the prevailing party, as determined by a court of competent jurisdiction, shall be entitled to reimbursement from the other party for its reasonable attorneys’ fees, court costs and litigation expenses therein.

14. Management Obligation:

SELLER shall conduct harvesting activities for the Timberlands in accordance with applicable state best management practices for water quality protection in forestry (“BMP’s”) in a manner that meets the minimum requirements of the Sustainable Forestry Initiative Standard (“SFI”), or such other third-party certification program as is mutually approved in writing from time to time by BUYER and SELLER. SELLER shall use logging professionals trained in accordance with the applicable SFI SIC standards. Compliance with this paragraph shall be evidenced in all respects by a certificate verifying compliance with the agreed-upon certification system, including its wood sourcing provisions.

15. Insurance:

(a) Each party shall, throughout the term of this Contract, carry appropriate insurance with a reputable insurance company covering property damage, business interruptions, worker’s compensation, employer’s liability and general liability insurance (including contractual liability) to protect its own business and property interests, provided that each party may self-insure in accordance with applicable industry standards.

(b) SELLER shall provide to BUYER acceptable evidence of all insurance required hereunder, and evidence of all renewals or replacements shall be provided at least fifteen (15) days prior to the expiration. SELLER shall require its insurance agent or broker to provide written notice to BUYER immediately upon receipt of any notice of cancellation or non-renewal of any required coverages by the insurers.

(c) If SELLER assigns this Contract, in whole or in part, in accordance with paragraph 10, BUYER may, at its option, amend the terms of this paragraph 15, only to the extent such amendment applies solely to such assignee and not to SELLER, provided, however that such amended terms are substantially similar to the coverage requirements imposed generally in BUYER’S then current pulpwood supply agreements. For purposes of this sub-paragraph 15(c) only, the term “SELLER” shall refer solely to [SELLER] Company and not its successors or assigns.

16. Warranty and Taxes:

SELLER warrants to BUYER, as of each delivery of Wood hereunder, that (a) it owns and is delivering good and marketable title to the Wood; and (b) it is legally entitled to sell the Wood delivered and that all Wood is free from all liens and encumbrances. Unless otherwise required by applicable state law, BUYER shall pay, or cause to be paid, all severance taxes upon or incident to the production and delivery of Wood hereunder which will or may constitute a lien thereon or on any products manufactured therefrom. SELLER will indemnify and save harmless BUYER from any and all claims and actions covering loss costs, expenses (including attorney and legal fees), and damages of every kind and description which may be brought or made against BUYER on account of or in any manner arising out of any title to the Timberlands.

17. Compliance with Laws, Rules and Regulations:

Each party covenants and agrees that it will secure and keep in effect all necessary licenses and permits incident to its operations in the performance of this Contract, and that all Wood sold and delivered hereunder will be purchased, produced, delivered and unloaded in compliance with all applicable state and federal laws, rules and regulations. Either party will, upon the reasonable request of the other party and solely to the extent practicable, provide the other party with evidence, reasonably satisfactory to the requesting party, of such compliance with such state or federal laws, rules and regulations.

18. Force Majeure:

(a) In the event that either BUYER or SELLER shall be prevented from performing its respective obligations hereunder by reason of fire, flood, riots, civil commotion, war, labor strikes or work stoppages, contingencies of transportation, embargoes or any cause or causes (whether or not of a similar nature) beyond the reasonable control of such party, or an act of God (each of the foregoing a “Force Majeure Event”), such party shall not be held in breach hereof, but shall be excused for such nonperformance to the extent and during such time that such Force Majeure Event exists. Each party shall use its commercially reasonable efforts to minimize the duration and consequences of any failure or delay in delivery or acceptance of delivery resulting from a Force Majeure Event and shall give notice of the occurrence of a Force Majeure Event as soon as commercially practicable after the occurrence thereof, which notice shall include the time when the party affected by such Force Majeure Event is no longer anticipated to be affected thereby.

(b) 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 the BUYER cannot maintain its scheduled Wood inventory at any of the Transferred Xxxxx, BUYER shall, upon notice to SELLER, have the right to obtain Wood, or substitutes therefor (in either case “Substitute Products”), from sources other than SELLER until such time as SELLER is again able to commence the delivery of Wood to BUYER. After SELLER gives notice to BUYER that it is again able to commence delivery of Wood to BUYER pursuant to the terms of this Contract, BUYER shall notify SELLER of any commitments for Substitute Products that BUYER has entered into. BUYER shall not be required to accept delivery from SELLER of the amount by which the delivery was reduced until such time as BUYER has accepted delivery of all Substitute Products contracted by BUYER, provided that no such contract for Substitute Products shall be for a term longer than two (2) months without consent of SELLER, which consent shall not be unreasonably withheld, conditioned or delayed. BUYER’S obligation to accept Wood hereunder (and SELLER’S obligation to deliver such Wood) shall be reduced, at BUYER’S election, by the quantity of all such Substitute Products.

(c) Notwithstanding anything herein to the contrary, if, as a result of a Force Majeure Event pursuant to which BUYER cannot accept the quantity of Wood provided for herein, BUYER shall promptly so notify SELLER, and SELLER shall thereafter have the right to contract for the sale of any such Wood BUYER is unable to accept. Upon notice from BUYER to SELLER that BUYER is again able to accept delivery of such Wood, SELLER will notify BUYER of any commitments for the sale of Wood that SELLER has entered into and SELLER shall not be required to again deliver such Wood to BUYER until SELLER has delivered all Wood contracted by SELLER, provided that no such Contract shall be entered into for a term longer than two (2) months without the written consent of BUYER, which consent shall not be unreasonably withheld, conditioned or delayed. SELLER’S obligation to deliver Wood hereunder (and BUYER’S obligation to accept such Wood) shall be reduced, at SELLER’S election, by the quantity of all such Wood contracted by SELLER to alternate buyers.

(d) If a Force Majeure Event prevents operation of a Transferred Mill or any portion thereof, BUYER will use its best efforts, within sixty (60) days of such event or as soon thereafter as reasonably practicable, to notify SELLER of whether BUYER intends to continue operations of the Tranferred Mill and the anticipated date such operations will begin. In the event BUYER has not reassigned some or all of the Wood Reduction, as defined in paragraph 9(b), applicable to a Transferred Mill to another location, then, within six (6) months after the shutdown of such Transferred Mill or portion thereof, either BUYER or SELLER may terminate this Contract with respect to the portion of the Wood Reduction that has not been reassigned upon thirty (30) days written notice.

(e) Notwithstanding anything herein to the contrary, a “Force Majeure Event” shall not include (i) adverse financial or market conditions, (ii) a party’s financial inability to perform, or (iii) an act, omission or circumstance arising from the negligence or willful misconduct of the party claiming that a Force Majeure Event has occurred.

19. Succession:

Wherever the word SELLER or BUYER occurs in this Contract, it shall be deemed to refer to its successors and, when assignable, to the permitted assigns of such party, as the case may be.

20. Notices:

All notices, requests, claims, demands, waivers and other communications under this Contract shall be in writing and shall be deemed given (a) five (5) Business Days following sending by registered or certified mail, postage prepaid, (b) when sent, if sent by facsimile, provided that the facsimile transmission is promptly confirmed by telephone, (c) when delivered, if delivered personally to the intended recipient and (d) one (1) Business Day following sending by overnight delivery via a courier service that is nationally recognized in the United States and, in each case, addressed to a party at the following address for such party:

if to SELLER, to

[SELLER] Company

00000 Xxxx Xxx Xxxxx

Xxxxxxx Xxx, XX 00000

Attention: [·]

Facsimile: [·]

with a copy to:

[SELLER] Company

00000 Xxxx Xxx Xxxxx

Xxxxxxx Xxx, XX 00000

Attention: General Counsel

Legal Department M/S CH 2J28

Facsimile: [·]

if to BUYER, to

International Paper Company

International Place Towers, 0000 Xxxxxx

Xxxxxxx, XX 00000

Attention: Vice President

Facsimile: [·]

with a copy to:

International Paper

International Place Towers

0000 Xxxxxx

Xxxxxxx, XX 00000

Attention: Legal Department

Facsimile: [·]

or to such other address(es) as shall be furnished in writing by any such party to the other party hereto in accordance with the provisions of this paragraph 20.

21. Dispute Resolution:

(a) Any issue, dispute or controversy arising pursuant to this Contract (a “Dispute”) shall be settled in the following manner. Upon written request of either party, the representatives of BUYER and of SELLER shall promptly confer and exert their commercially reasonable efforts without the necessity of any formal proceeding related thereto to reach a reasonable and equitable resolution of such Dispute. If such representatives are unable to resolve such Dispute within ten (10) Business Days, the Dispute shall be referred to the responsible senior management of each party for resolution. Neither party shall seek any other means of resolving any Dispute arising in connection with this Contract until both parties’ responsible senior management have had at least five (5) Business Days to resolve the Dispute following its referral to them.

(b) If the Dispute cannot be resolved by senior management, either party may, at its option, provide written notice of its intent to arbitrate. Arbitration shall be according to the rules of the American Arbitration Association (the “AAA”), except as herein modified by the parties or otherwise as agreed to by the parties. Within ten (10) days of receipt of such notice of intent to arbitrate, each party will select an arbitrator, and notify the other party of its selection. Within fifteen (15) days after such notice, the respective arbitrators shall select a third arbitrator as the Chairman of the panel. All such arbitrators shall have experience in the business of producing, procuring and selling forest products, preferably in the state in which the Wood was or is to be delivered. A hearing by the arbitration panel must be held within thirty (30) days after the selection of the Chairman and a majority decision of the panel and resolution must be reached within thirty (30) days of such hearing. 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.

(c) Notwithstanding the above, in the event arbitration is a result of the parties’ inability to agree upon quarterly pricing pursuant to paragraph 5, the following process will be followed:

(i) Within fifteen (15) days following the appointment of the panel, each party will submit to the panel the price that such party desires to apply to the Products involved and any materials such party wishes to submit supporting the use of the proposed fair market price. This documentation shall be kept confidential by the panel with respect to any third party.

(ii) Within fifteen (15) days following the submission of the prices by each party, the panel will choose between the two submitted prices based upon the panel’s determination of the price that better reflects the fair market price for the subject Products. If only one proposed price is submitted, the panel will choose such price.

(iii) The panel will deliver the decision in writing to each of the parties within three (3) days following the date of its determination and shall assess the costs of the arbitration and reasonable attorney fees against the party whose prices was not chosen or who did not submit a price.

(d) Other than as set forth in paragraph 21(c), each party shall bear its own cost of presenting its case, and each party shall bear one-half of the cost incurred by the panel, the mediation, or an alternative dispute resolution procedure, as the case may be.

(e) Except as otherwise described in paragraph 7 or actions brought to enforce an arbitral award or the provisions of this paragraph 21, the dispute resolution process set out herein shall be the sole mechanism for dispute resolution.

22. Confidentiality:

(a) It is recognized that neither party may disclose to any other party the terms of this Contract or any other confidential or proprietary information with which the parties come into contact by virtue of entering into this Contract, provided, however, that the (i) the existence of this Contract and such other agreements as are disclosed herein, (ii) identification of the parties to this Contract, (iii) identification of the real property subject to this Contract, and (iv) identification of the time period of this Contract, shall not be considered confidential information for purposes of this paragraph 22. The parties agree to maintain the confidentiality of such confidential and proprietary information and to use such information solely for the use, sale and pricing of Wood under this Contract, and to use their diligent efforts to prevent the disclosure of such information (other than information which is a matter of public knowledge or which has been filed as public information with any government authority) to third parties without prior written consent of the affected party, unless disclosure is required by law.

(b) Notwithstanding anything to the contrary herein, any party may make any such disclosure necessary in connection with a legal action to enforce its rights hereunder, to the extent permitted by this Contract. Any party may make any such disclosure necessary to a prospective purchaser of the Transferred Xxxxx or all or any portion of the Timberlands provided such prospective purchaser enters into a confidentiality agreement requiring it to use its diligent efforts to prevent the disclosure of such information (other than information which is a matter of public knowledge or which has been filed as public information with any government authority) to third parties without prior written consent of BUYER unless disclosure is required by law.

(c) No party shall, without prior notice to and consultation with the other party, issue any press release or otherwise make any public announcements pertaining to this Contract and the transactions contemplated hereby, subject to any applicable disclosure requirements mandated by law or by any regulatory agency under which any party is subject.

23. Sale of SELLER’S Rights in Timberlands:

It is mutually understood and agreed that the Wood contemplated to be delivered by SELLER to BUYER will be supplied from the Timberlands. In the event of any Transfer of the Timberlands beyond an aggregate cumulative amount of 50,000 acres from the date hereof, the parties shall cooperate and work in good faith to facilitate the partial assignment and assumption of this Contract or the entry into a new pulpwood supply agreement substantially identical hereto or such other assurances by SELLER acceptable to BUYER that SELLER shall be able to continue to meet its obligations under this Contract, including such arrangements contemplated by paragraph 10. In the event SELLER wishes to supply wood hereunder from a source other than the Timberlands, SELLER must obtain the prior consent of BUYER.

24. Complete Contract:

This Contract, including any exhibits, schedules, attachments, purchase orders or addendums hereto constitute the entire contractual relationship between the parties relating to the purchase of Wood by BUYER from SELLER, all previous negotiations, contracts and representations having been merged herein. This Contract may be amended only by a written instrument signed by both parties hereto.

25. Governing Law:

This Contract shall be construed and enforced in accordance with the laws of New York without regard to the principles of conflict of laws thereof.

26. Recordation

Neither party shall file or record a copy of this Contract, or a memorandum or notice thereof, in the land records of any county or parish in which any portion of the Timberlands is situated, or in any other county or parish in which SELLER owns or will own property. SELLER shall have the right to sell, convey or encumber any of SELLER’s property, including the Timberlands, in accordance with the terms of this Contract.

27. Right to Access and Audit

Each party shall have the right to audit the other party’s compliance with the terms of this Contract, including but not limited to the terms of paragraphs 3, 4, 5, 6 and 15, by notifying the other party of its 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. Each party will provide the other reasonable access during normal business hours to all records and other information necessary to complete such audit as are commercially reasonable.

28. Further Assurances

SELLER and BUYER covenant to cooperate with one another in all reasonable respects necessary to consummate and give effect to the transactions contemplated by this Contract (including executing and delivering such instruments or other writings, and sharing of payment, delivery and other information, in each case as may reasonably requested by the other party), and each will take all reasonable actions within its authority to secure cooperation of any necessary third parties.

29. Electronic Transaction

BUYER and SELLER agree that, at their option, they may facilitate the transactions contemplated by this Contract by electronically transmitting and receiving data. For the mutual benefit of the parties, it is agreed that all such electronically transmitted data shall be legally valid and enforceable.

30. Severability

If any term or provision of this Contract shall be held to be invalid or unenforceable, the remainder of this Contract shall not be affected thereby and each term of this Contract shall be valid and enforceable to the fullest extent permitted by law and said invalid or unenforceable term or provision shall be substituted by a term or provision as near in substance as may be valid and enforceable.

31. Counterparts

This Contract may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. This Contract may be executed by facsimile transmission, with the intention that such facsimile signature and delivery shall have the same effect as an original signature and actual delivery.

32. Captions

The captions and headings in this Contract are for convenience only and shall not be construed as a part of this Contract.

(The remainder of this page is left blank intentionally)

IN WITNESS WHEREOF, the parties have executed or caused this Contract to be executed by persons authorized to sign on their respective behalf, all as of the day and date first above set out.

“BUYER”

INTERNATIONAL PAPER COMPANY, a New York corporation

By:

Name:

Title:

“SELLER”

[SELLER] COMPANY,

a Washington company

By:

Name:

Title:

Schedule 1

Pulpwood Volume

Schedule 2

Pulpwood Specifications

Schedule 3

F2M Data

2Market FOB Pulpwood & Chip Benchmark Market Areas