TIMBERLAND PURCHASE AND SALE AGREEMENT VIRGINIA TIMBERLANDS

Exhibit 10.2

TIMBERLAND PURCHASE AND SALE AGREEMENT
VIRGINIA TIMBERLANDS

This Timberland Purchase and Sale Agreement (“Agreement”) is entered into by and between GLAWSON INVESTMENTS CORP., a Georgia corporation (“Purchaser Parent”), GIC INVESTMENTS LLC, a Delaware limited liability company owned by Purchaser Parent (“Purchaser”) and GLATFELTER PULP WOOD COMPANY, a Maryland corporation (“Seller”), dated and effective as of August 8 2007.

Now, Therefore , subject to the terms and conditions set forth in this Agreement and in consideration of the mutual covenants and agreements of the parties herein contained, the receipt and adequacy of which hereby are acknowledged, the parties agree as follows:

Article 1
Definitions

1.1 Terms . As used in this Agreement, the following terms shall have the following meanings:

	(a)		[Intentionally Omitted]
	(b)		Agreement . “Agreement” means this Timberland Purchase and Sale Agreement dated as of August ___, 2007.
	(c)		Assignment and Assumption Agreement For Land-Related Agreements and Permits . “Assignment and Assumption Agreement for Land-Related Agreements and Permits” means the instrument to assign and assume the Land-Related Agreements and the Permits. The form of such Assignment and Assumption Agreement for Land-Related Agreements and Permits is attached as Exhibit G .
	(d)		Bank . “Bank” means a U.S. or state chartered bank or other financial institution acceptable to Seller in its sole discretion.

	(e)		Business Day . “Business Day” means a day of the year other than a Saturday or Sunday or day on which banks are required or authorized to close in New York, New York.
	(f)		Cash Assets . “Cash Assets” means the assets identified on Exhibit N , if any.
	(g)		Closing & Closing Date . “Closing” and “Closing Date” mean the date on which the Purchase Price is paid, the Deed(s) are conveyed to Timber LLC for recording, and the Timber LLC Interests are conveyed to Purchaser.
	(h)		Code . “Code” means the Internal Revenue Code of 1986, as amended.
	(i)		Deed and Deed(s). “Deed and Deed(s)” mean limited warranty deed(s) to Timber LLC, each of which shall warrant title only against the lawful claims arising by, through, or under Seller. The Deed shall be substantially in the form set forth in Exhibit D .
	(j)		Dollars . “Dollars” or the symbol “$” means lawful money of the United States of America denominated in United States dollars.
	(k)		Earnest Money Deposit . “Earnest Money Deposit” has the meaning specified in Article 3.2.
	(l)		Environmental Defect Parcels . “Environmental Defect Parcels” has the meaning specified in Article 3.4.
	(m)		Environmental Law . “Environmental Law” means any applicable federal or state law, rule, or regulation pertaining to pollution or protection of the environment, human health, or actual or threatened releases, discharges, or emissions into the environment.
	(n)		Escrow Officer . “Escrow Officer” means the following, who shall serve as escrow agent for the purchase and sale of the Timber LLC Interests and transfer of the Timberland Property:

Chicago Title Insurance Company
4170 Ashford Dunwoody Road, Ste 460
Atlanta, GA 30319
Attn: Chris Valentine
Tel: 404-303-6300
Fax — 404-303-6307

	(o)		Governmental Authority . “Governmental Authority” means the government of the United States of America or any other state or other political subdivision thereof or any branch, department, agency, instrumentality, court, tribunal, or regulatory authority that constitutes a part, or exercises any sovereign power of, any of the foregoing.
	(p)		Hazardous Substances . “Hazardous Substances” means any substance or material defined or designated as a “Hazardous Substance” under any Environmental Law.
	(q)		HSR Notifications . “HSR Notifications” has the meaning specified in Article 5.1.
	(r)		Installment Note . “Installment Note(s)” has the meaning specified in Article 3. Such Installment Note(s) shall be substantially in the form set forth in Exhibit K with such modifications as may be mutually agreed by the parties.
	(s)		Installment Note Purchase Price . “Installment Note Purchase Price” means the portion of the Purchase Price payable by Purchaser to Seller in consideration for the Installment Note Timberlands.
	(t)		Installment Note Timberlands . “Installment Note Timberlands” means the Timberland Property.
	(u)		Land-Related Agreements . “Land-Related Agreements” means all leases, easements, rights-of-way, road rights, permits, licenses, contracts, agreements, and other commitments (except collective bargaining agreements) primarily incident or appurtenant to Seller’s ownership of the Timberland Property listed or described in Exhibit E .

	(v)		Letters of Credit . “Letters of Credit” has the meaning specified in Article 3. The Letters of Credit shall be in such form and substance as may be mutually agreed by the parties and otherwise consistent with the Timber Note Indicative Terms.
	(w)		Notice of Default . “Notice of Default” has the meaning specified in Article 8.3.
	(x)		Permits . “Permits” means the governmental permits, if any, listed or described in Exhibit F .
	(y)		Permitted Exceptions . “Permitted Exceptions” has the meaning specified in Article 3.4.
	(z)		Person . “Person” means an individual, partnership, limited partnership, corporation (including a business trust), limited liability company, joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.
	(aa)		Pledge Agreement . “Pledge Agreement” has the meaning specified in Article 3. The Pledge Agreement shall be in such form and substance as may be mutually agreed by the parties and otherwise consistent with the Timber Note Indicative Terms.
	(bb)		Protected Species . “Protected Species” means any species of fish or wildlife listed as either threatened or endangered under Section 4 of the Endangered Species Act of 1973, as amended, 16 U.S.C. § 1531 et seq.
	(cc)		Purchase Price . “Purchase Price” has the meaning specified in Article 3.
	(dd)		Purchaser . “Purchaser” has the meaning specified in the Preamble.
	(ee)		Purchaser Parent . “Purchaser Parent” has the meaning specified in the Preamble.

	(ff)		Purchasing Parties . “Purchasing Parties” means, prior to the Closing, Purchaser Parent and Purchaser and, immediately prior to, on and after the Closing, Purchaser Parent, Purchaser and Timber LLC.
	(gg)		Reimbursement Agreement . “Reimbursement Agreement” has the meaning specified in Article 3. The Reimbursement Agreement shall be in such form and substance as may be mutually agreed by the parties and otherwise consistent with the Timber Note Indicative Terms.
	(hh)		Seller . “Seller” means Glatfelter Pulpwood Company and/or its assigns.
	(ii)		Seller’s Certificate of Non-Foreign Status . “Seller’s Certificate of Non-Foreign Status” means Seller’s Internal Revenue Code § 1445 Certificate. The form for Seller’s Certificate of Non-Foreign Status is set forth in Exhibit H .
	(jj)		Seller’s Knowledge . “Seller’s Knowledge” means present actual knowledge, without any duty of investigation or inquiry, of any of the following employees of Seller: Thomas V. Bosley and James B. Kuykendall.
	(kk)		Seller’s Non-Financial Management Records . “Seller’s Non-financial Management Records” means Seller’s management records concerning the Timberland Property listed on Exhibit B-2 and specifically excluding any records that are proprietary and confidential to Seller.
	(ll)		Standard Timberland Title Exceptions . “Standard Timberland Title Exceptions” means the general exceptions to title set forth in Exhibit C .
	(mm)		Subsidiary . “Subsidiary” means, with respect to any Person, any other Person of which (i) a majority of the outstanding share capital, voting securities or other equity interests are owned, directly or indirectly, by such Person or (ii) such Person is entitled, directly or indirectly, to appoint a majority of the board of directors or managers or comparable supervisory body of the other Person.

	(nn)		Timber LLC . “Timber LLC” means up to two (2) Delaware limited liability companies to be formed by Seller prior to the Closing, pursuant to organizational documents reasonably satisfactory to Seller and Purchasing Parties, for the purposes described in Article 2.4, and any successor to such entity.
	(oo)		Timber LLC Assets . “Timber LLC Assets” has the meaning specified in Article 2.4.
	(pp)		Timber LLC Interests . “Timber LLC Interests” means all of the membership interests outstanding as of the Closing Date in Timber LLC.
	(qq)		Timber Note Indicative Terms . “Timber Note Indicative Terms” means the terms of the Installment Notes as set forth in Exhibit M .
	(rr)		Timberland Property . “Timberland Property” means certain unimproved timberland listed on Exhibit A , together with timber (standing and downed), reproduction, any improvements thereon.
	(ss)		Title Defects . “Title Defects” has the meaning specified in Article 3.4.
	(tt)		Title Defect Parcels . “Title Defect Parcels” has the meaning specified in Article 3.4.
	(uu)		Title Insurer . “Title Insurer” means Chicago Title Insurance Company.
	(vv)		Title Policy . “Title Policy” has the meaning specified in Article 4.3.
	(ww)		Transaction Documents . “Transaction Documents” means this Agreement, the Installment Notes, the Letters of Credit and any exhibits or schedules thereto or other documents referred to therein.
	(xx)		Treasury Regulations . “Treasury Regulations” means the treasury regulations (including temporary regulations) promulgated by the United States Department of Treasury with respect to the Code.

(yy)

Value Table . “Value Table” means the table attached as Exhibit J .

1.2 Accounting Terms . All accounting terms not specifically defined in this Agreement shall be construed, and all accounting procedures shall be performed, in accordance with generally accepted accounting principles applicable in the United States as of the date of this Agreement, consistently applied.

Article 2
Purchased Property And Assumed Liabilities

2.1 Property To Be Purchased And Sold . Seller hereby agrees to sell to Purchaser and Purchaser hereby agrees to purchase from Seller, on the Closing Date, for the Purchase Price, and upon the terms and subject to the conditions hereinafter stated, the Timber LLC Interests. On or before Closing, Seller shall assign, transfer or convey to Timber LLC the following:

	(a)		Timberland Property . All of the Timberland Property.
	(b)		Land-Related Agreements . To the extent assignable without consent of third parties, to the extent assignable with consents where such consents are reasonably obtainable at no cost to Seller, and to the extent of Seller’s assignable interest therein where such consents are not reasonably obtainable at no cost to Seller and where such agreements without consent are acceptable to Purchasing Parties, without liability to Seller for such failure to obtain consents, all of Seller’s right, title, and interest in and to the Land-Related Agreements, all of which are listed on Exhibit E ; provided, however, that except for the Replanting Obligations (as hereinafter defined), Purchasing Parties shall have the right to review and approve during the Inspection Period all Land-Related Agreements as being the type of agreements that typically are assigned to and assumed by a purchaser in a large timberland transaction and that the Land-Related Agreements, taken as a whole, are commercially fair and reasonable and do not impose an undue burden on either the Timberland Property or Purchaser.
	(c)		Permits . To the extent assignable without liability to Seller, all of Seller’s right, title, and interest in and to the Permits listed on Exhibit F .

2.2 Assumed Liabilities . Seller shall cause Timber LLC to assume immediately prior to the Closing and pay when due, to the extent not paid or discharged prior to the Closing, only those liabilities and obligations of Seller arising from and after the Closing Date pursuant to the following:

	(a)		Timberland Property . Any obligation pertaining to the Timberland Property as specifically identified in this Agreement including the Exhibits excepting, however, any obligations under any Land Related Agreements that are not assumed by Timber LLC.
	(b)		Land-Related Agreements . All outstanding obligations under the Land-Related Agreements assigned to Timber LLC and specifically identified in the Assignment and Assumption Agreement, including, without limitation, all of Seller’s obligations under Virginia law to replant harvested acres and all of Seller’s Virginia Department of Forestry Alternative Management Plans (collectively, the “Replanting Obligations”). Timber LLC shall execute such forms as prescribed by the Virginia Department of Forestry to assume all of Seller’s Replanting Obligations, including, without limitation, Form 74B.
	(c)		Permits . All obligations under the Permits assigned to Timber LLC.

Neither Purchaser nor Purchaser Parent shall be liable for the obligations assumed by Timber LLC.

2.3 Excluded Liabilities . None of the Purchasing Parties shall assume or be liable for obligations under Land-Related Agreements and Permits not assumed by Timber LLC.

2.4 Deeds . On or before Closing, Seller shall cause to be deeded to Timber LLC all of the Timberland Property, and shall assign to Timber LLC, as provided above, the Land-Related Agreements and Permits (collectively, the “Timber LLC Assets”). The parties shall cooperate in good faith with the Title Company to mutually agree on appropriate legal descriptions for each tract at least ten (10) days in advance of Closing. No later than ten (10) days prior to the Closing Date, Purchaser Parent shall specify whether Seller is to form two Timber LLCs, and in the event it does so, it shall also designate to Seller which of the Timber LLC Assets are to be conveyed to each such Timber LLC.

Article 3
Purchase Price And Terms

3.1 Purchase Price . The total purchase price shall be $43,135,000.00 (the “Purchase Price”); provided, however, that the Purchase Price may be adjusted pursuant to Article 3.4.

3.2 Earnest Money Deposit . Upon execution of this agreement, Purchaser shall deposit into escrow with the Escrow Officer the sum of $1,000,000.00 which amount shall be held by the Escrow Officer, in escrow in an insured, interest-bearing account. The parties understand and agree that upon expiration of Purchaser’s Inspection Period (hereinafter defined in Article 5.5) Purchaser shall deposit into escrow with the Escrow Office the additional sum of $1,000,000.00, provided this Agreement is not terminated by the Purchaser upon expiration of the Purchaser’s Inspection Period. All principal and interest in such account is herein referred to as the “Earnest Money Deposit.” At the Closing, the Earnest Money Deposit shall be returned to Purchaser.

	(a)		Purchaser Fails To Close. Except as provided in clause (c) below, if Purchaser fails to close this transaction on or before the Closing Date, other than because of a default by Seller, then Escrow Officer shall have the Earnest Money Deposit paid over to Seller, the same being agreed upon as liquidated damages for the failure of Purchaser to consummate the transaction contemplated hereunder. Seller agrees to accept and take the Earnest Money Deposit as its total damages and relief and as Seller’s sole and exclusive remedy hereunder, the parties hereby agreeing and acknowledging that: (a) Seller would suffer damages by reason of a failure of this transaction to close; (b) the exact amount of such damages would be difficult to ascertain and to prove with certainty; (c) the Earnest Money Deposit constitutes a fair and reasonable estimate of the actual damages Seller would suffer; and (d) the parties (and/or their representatives) have negotiated and attempted, in good faith, to estimate the amount of such damages and to compensate Seller therefore as set forth herein.
	(b)		Seller Fails To Close. Should Closing not occur due to the default of Seller, which default remains uncured after five (5) days notice from Purchaser, Purchaser’s remedies shall be limited to, at Purchaser’s sole election, to the following: (i) liquidated damages being the return of the Earnest Money Deposit and the payment by Seller to Purchaser of a cancellation fee of $250,000.00, and termination of this Agreement; or (ii)

			specific performance. Should Purchaser elect to accept the return of the Earnest Money Deposit and payment by Seller to Purchaser of a cancellation fee of $250,000.00 the parties agree that this sum is liquidated damages for the failure of Seller to consummate the transaction contemplated hereunder. If Purchaser waives its right to seek specific performance, Purchaser shall accept liquidated damages and agrees to accept the sum as its total damages and relief and as Purchaser’s sole and exclusive remedy hereunder, the parties hereby agreeing and acknowledging that: (a) Purchaser would suffer damages by reason of a failure of this transaction to close; (b) the exact amount of such damages would be difficult to ascertain and to prove with certainty; (c) the return of the Earnest Money Deposit and the payment of the cancellation fee of $250,000.00 constitutes a fair and reasonable estimate of the actual damages Purchaser would suffer; and (d) the parties (and/or their representatives) have negotiated and attempted, in good faith, to estimate the amount of such damages and to compensate Purchaser therefore as set forth herein.
	(c)		Letter of Credit Failure . In the event that Purchaser complies with its obligations under Article 14.4 but is unable to satisfy the closing condition in Article 8.2(e) and Seller elects not to consummate the transaction contemplated herein as a result of such condition failure, then Escrow Officer shall have the Earnest Money Deposit paid over to Purchaser, and neither Purchaser, Purchaser Parent or any Purchaser Assignee shall have any further liability to Seller for such condition failure.

3.3 Payment Terms . The Purchase Price shall be payable as provided in this Article 3.3 on the Closing Date.

	(a)		Cash Assets . The portion of the Purchase Price allocable to the Cash Assets, if any, shall be payable in cash in immediately available funds, and Purchaser Parent shall wire transfer the funds consistent with Seller’s wire transfer instructions.
	(b)		Installment Note Timberlands . The Installment Note Purchase Price shall be paid by issuance of one or more installment notes in an aggregate principal amount equal to the Installment Note Purchase Price and in substantially the form set out in Exhibit K with such modifications as may be mutually agreed by the parties (each an “Installment Note”). Each Installment Note shall be issued in the denomination(s) requested by Seller

			at least five (5) Business Days prior to the Closing Date. At Closing, Purchaser shall deliver to Seller, for the purpose of supporting Purchaser’s obligations under the Installment Notes, separate irrevocable standby letters of credit in amounts sufficient to support the aggregate principal amount of all Installment Notes (and related interest component) in such form and substance as may be mutually agreed by the parties and otherwise consistent with the Timber Note Indicative Terms (the “Letters of Credit”), issued by the Bank for the account of Purchaser pursuant to a reimbursement agreement in such form and substance as may be mutually agreed by the parties and otherwise consistent with the Timber Note Indicative Terms (the “Reimbursement Agreement”). Purchaser’s obligations under the Reimbursement Agreement will be secured pursuant to a pledge agreement in such form and substance as may be mutually agreed by the parties and otherwise consistent with the Timber Note Indicative Terms (the “Pledge Agreement”). The Letters of Credit, Reimbursement Agreement, and Pledge Agreement are collectively referred to as the “LC Documents.” Each Letter of Credit will have an initial stated amount equal to the principal amount of the corresponding Installment Note plus a corresponding interest component as described in the Letter of Credit. Each Installment Note shall be dated as of the Closing Date and shall mature on the twentieth anniversary of the Closing Date. The expiration date of each Letter of Credit shall be the date that is 15 days after the maturity date of the corresponding Installment Note.
	(c)		Cooperation Regarding Transaction Structure . Purchaser Parent and Purchaser shall cooperate with Seller to structure the transaction in a tax efficient and cost-effective manner, so long as the same does not cause Purchaser or Purchaser Parent to incur any additional liability whatsoever or incur material expense, other than as contemplated in the Timber Note Indicative Terms. Seller agrees to reasonably cooperate with Purchaser to structure the transaction to be reasonably acceptable to Purchaser, so long as such structure is consistent with the Timber Note Indicative Terms. Purchaser will be solely responsible for all costs associated with the Installment Note transaction reflected in the Timber Note Indicative Terms (including, without limitation, the costs associated with the Letters of Credit).

3.4 Adjustments To Purchase Price . The Purchase Price may be adjusted under the following circumstances:

(a)

Title . Seller shall provide to Purchaser Parent copies of all vesting deeds and surveys of the Property in its possession and prior year’s tax receipts from all taxing authorities for each tract identified therein. Purchaser Parent shall have until expiration of the Inspection Period to obtain a title insurance commitment and to notify Seller, in writing, of Purchaser Parent’s disapproval of any exceptions shown in the Title Commitment other than the Standard Timberland Title Exceptions, or other objections known to and discovered by Purchaser Parent at that time. The Standard Timberland Title Exceptions and those exceptions that are not objected to and the Title Defects that are accepted by Purchaser Parent shall be deemed to be the “Permitted Exceptions.” If Purchaser Parent notifies Seller within ten (10) days after the expiration of the Inspection Period that it disapproves of any exceptions listed on the Title Commitment or otherwise discovered by Purchaser Parent, Seller shall have ten (10) days after receiving the disapproval notice to remove the exceptions, provide Purchaser Parent with reasonable assurances of the manner in which the exceptions will be removed before the Closing or deliver notice it does not intend to cure some or any of them. If Seller does not remove the material exceptions or provide Purchaser Parent with such assurances that are acceptable to Purchaser Parent, such disapproved title exceptions shall be deemed title defects (“Title Defects”), in which case, Purchaser Parent shall have the option, in its sole discretion, within 10 days of Seller’s response to: (i) take the Timberland Property subject to the Title Defects; or (ii) reject the portions of the Timberland Property affected by such Title Defects (the “Title Defect Parcels”); provided, however, that the creation, configuration, and size of any Title Defect Parcel shall be in economically and commercially viable size and location and shall be in compliance with all applicable land use and development standards and shall be determined by Seller in its reasonable business judgment after consulting with Purchaser Parent but in no event to exceed eighty (80) additional acres beyond the acreage affected by the Title Defect. In the event any subdivision or record plan or other mechanism to legally subdivide and retain title to the Title Defect Parcel is required (the “Subdivision Approval”) the same shall be undertaken at Purchaser Parent’s sole cost and expense on or before the Closing Date, with Seller agreeing to reasonably cooperate in processing the same. If the Subdivision Approval is not obtained by the Closing Date, the entire Tract(s) containing the Title Defect Parcel shall be excluded from the Timberland Property. Purchaser Parent may exclude only four (4) Title Defect Parcels in the aggregate. Seller shall provide Purchaser an adjustment to the Purchase Price at Closing for the average price per acre shown on the Value Table for the number of acres deleted by Seller as a result of the Title Defect. In such circumstance, the Purchase Price shall be decreased by the aggregate value

of all Title Defect Parcels determined according to the Value Table. For purposes of this Article, a parcel acquired by Seller by quitclaim deed shall not be deemed a Title Defect Parcel based solely on the fact that title was acquired by quitclaim deed; provided, however, that the Title Commitment does not indicate an exception to the title or Purchaser Parent does not otherwise identify an objection to title other than the fact that the tract was transferred by quitclaim deed.

	(b)		Access . For the purposes of this Agreement, any parcel of the Timberland Property that lacks insurable access to and from a public road shall be viewed as lacking access. As of Closing, the parcels lacking insurable access may be treated as Title Defect Parcels at Purchaser Parent’s election, in which event said parcels lacking insurable access may be deleted from the Property and an adjustment to the Purchase Price shall be made for the average price per acre shown on the Value Table for the number of acres within said tract or tracts lacking insurable access.
	(c)		Environmental Assessment & Protected Species Review . To the extent in Seller’s possession, Seller shall provide Purchaser Parent with information collected as a result of its internal informal environmental site assessment, if any, within ten (10) days of the execution of this Agreement. No later than thirty (30) days after the expiration of the Inspection Period, Purchaser Parent may obtain a Phase I environmental assessment of the Timberland Property based on industry standards, as well as an assessment of any Protected Species currently inhabiting or affecting the Timberland Property (collectively, the “Assessments”). Seller shall reasonably cooperate with Purchaser Parent and Purchaser Parent’s environmental consultant in Purchaser Parent’s Phase I environmental assessment of the Timberland Property. In the event such reviews reveal: (i) the existence of any waste disposal site, landfill, dump site, hazardous waste or hazardous substance or spillage of any petroleum, crude oil or any fraction thereof, or any other facts or circumstances that are reasonably believed by Purchaser Parent’s environmental consultant to create or have the potential to create a material environmental risk or are or may be in material violation of Environmental Law, or (ii) material Protected Species issues or facts or circumstances that Purchaser Parent’s environmental consultant reasonably believes are or may be in violation of the Endangered Species Act or other federal, state or local law, rule or regulation protecting Protected Species, Purchaser Parent shall have the option, in its sole discretion, within thirty (30) days after expiration of the Inspection Period to take or reject the affected portions of the Timberland Property (the “Environmental Defect Parcels”); provided, however, that the creation,

configuration and size of any Environmental Defect Parcel shall be in economically and commercially viable size and location, and shall be in compliance with all applicable land use and development standards and shall be determined by Seller in its reasonable business judgment after consulting with Purchaser Parent but in no event to exceed eighty (80) additional acres beyond the acreage affected by the Environmental Defect. Any Subdivision Approval shall be undertaken at Purchaser Parent’s sole cost and expense on or before the Closing Date, with Seller agreeing to reasonably cooperate in processing the same. If the Subdivision Approval is not obtained by the Closing Date, the entire Tract(s) containing the Environmental Defect Parcel shall be excluded from the Timberland Property. Purchaser Parent may exclude only four (4) Environmental Defect Parcels in the aggregate. Seller shall provide Purchaser an adjustment to the Purchase Price at Closing for the average price per acre shown on the Value Table for the number of acres affected by the Environmental Defect and the additional acres added by Seller. In such circumstance, the Purchase Price shall be decreased by the aggregate value of the Environmental Defect Parcels including the acres added determined according to the Value Table.

	(d)		Scheduled Timber Harvest . Prior to Closing, Seller shall harvest timber in accordance with the cutting schedules to be provided by the Seller to the Purchaser Parent upon execution of this Agreement. All harvesting shall be completed by the Closing Date, and on or before said date, Seller shall provide to Purchaser Parent a notice of timber harvest with the supporting data, by tract number confirming the volume of timber harvested after May 31, 2007. At Seller’s election, the Purchase Price shall be adjusted downward based on the volume of timber harvested since May 31, 2007, and based upon the Value Table, or Seller shall pay Purchaser Parent at Closing for such timber based on the value of timber harvested and based upon the Value Table.
	(e)		Casualty Loss; Condemnation; Unauthorized Harvest . The parties acknowledge that losses of timber may occur prior to the Closing as a result of, but not limited to: (i) theft, fire, flood, storm, war, insurrection, natural disaster, disease, insects, or any other casualty or (ii) condemnation. In the event of any such loss prior to Closing as determined by the Value Table in excess of $100,000, there shall be an adjustment to the Purchase Price based upon the Value Table. Further, in the event of any such loss prior to Closing is in excess of ten percent (10%) of the Purchase Price, Purchaser Parent, or Seller at its election, may terminate this Agreement in which event the Earnest Money Deposit

shall be refunded to Purchaser and no party shall have any further liability hereunder except such as by its terms expressly survives termination (the “Surviving Obligations”).

(f)

Acreage Verification . Purchaser Parent may verify the information provided by Seller or other information furnished to or discovered by Purchaser Parent with regard to the acreage of the Timberland Property. In the event Purchaser Parent decides to perform such verification studies, such verification studies shall be completed no later than the expiration of the Inspection Period. Following such verification, subject to dispute by Seller, Purchaser Parent shall make available to Seller a copy of all verification study reports, data, and related materials that show an acreage variation that is more than 50 acres below the acreage contained in the Property, as represented by Seller, of 25,916.18 acres (as the same may have been reduced). If Seller retains a Title Defect Parcel or an Environmental Defect Parcel, the Purchase Price shall be adjusted for said acreage discrepancy based on the Value Table.

3.5 Process Applicable To Adjustments . In the event of adjustments pursuant to Article 3.4, the following provisions also shall apply.

	(a)		Surveys . If a survey is required to identify the legal description of any Title Defect Parcel or Environmental Defect Parcel, it shall be paid for one-half by Seller and one-half by Purchaser Parent and performed by a mutually acceptable registered land surveyor.
	(b)		Reservation Of Access Easements . If any of the portions of the Timberland Property retained by Seller pursuant to this Article do not have practical and legal access and require access across a portion of the Timberland Property, then at Closing Seller shall be entitled to reserve unto itself a non-exclusive road easement or easements for ingress and egress and utilities for the development and use of any retained parcels not more than sixty (60) feet in width (or any such width required for a public road up to eighty (80) feet, if reasonably necessary in Seller’s opinion) over the Timberland Property, such easement to be in the standard form used by Seller for such easements at a location approved by Purchaser Parent identifying all roads by appropriate legal description and attaching a map or plat with the location of the road cross-hatched. The easement shall in all events provide (i) that all merchantable timber that requires harvesting in order to construct, repair, or improve any road to make use

			of such easement shall be cut and decked by the roadside for Purchaser Parent’s disposition after written notice to Purchaser Parent at least sixty (60) days in advance, (ii) that Purchaser Parent has the absolute right to relocate the easement to another location selected by Purchaser Parent that does not have a material adverse effect on Seller; provided, however, that Purchaser Parent shall construct a road at least in the same condition as the existing road, if any, on the easement reserved by Seller and that the parties shall execute and file of record a Relocation of Easement in a form requested by Purchaser Parent and approved by Seller identifying the existing easement to be terminated and the new easement to be created shall be identified in the same manner as in the original easement.
	(c)		Dispute Resolution Regarding Adjustments . Disagreements regarding the adjustments, if any, to the Purchase Price and acreage as provided for herein shall be resolved prior to Closing by arbitration by a consultant agreed upon by the parties; provided, however, that such consultant shall use the Value Table for purposes of monetary calculation, in resolving any dispute and determining the appropriate adjustment to the Purchase Price. If the parties cannot agree upon a consultant, then each party shall appoint a consultant within five (5) days of receipt of written demand by the other and the two consultants shall appoint a third consultant within five (5) days of their appointment who shall act as the “consultant” for the purposes of this Article. If a party fails to appoint a consultant or the two parties fail to agree upon a consultant, then one may be appointed by a judge of a court having jurisdiction over the parties and the subject matter.

Article 4
Title

4.1 Conveyance Of Title To Timberland Property . On or before Closing, Seller shall convey marketable fee simple title to the Timberland Property by one or more Deed(s) to Timber LLC, each of which shall warrant title against the lawful claims arising by through or under Seller (collectively, the “Timberland LLC Deeds”). The Deed(s) and the conveyance of the Timberland Property to Timber LLC shall be subject to the Permitted Exceptions. Seller and Purchaser Parent shall agree on the allocation of the value of any tracts conveyed by county and shall complete any affidavits necessary for determining taxes or fees for filing the Deeds to Timber LLC or any mortgages desired by Purchaser Parent.

4.2 Conveyance of Timber LLC Interests . At Closing, Seller shall convey good and marketable title to the Timber LLC Interests to Purchaser by way of the Assignment and Assumption Agreement in the form of Exhibit O attached hereto (the “Assignment of LLC Interests”).

4.3 Title Insurance . Purchaser Parent, at its option, may elect to obtain an ALTA standard coverage owner’s and/or lender’s title insurance policy (the “Title Policy”) issued by the Title Insurer dated as of the Closing Date in the amount of the Purchase Price and showing title to the Timberland Property vested in the name of Timber LLC. As a condition to Purchasing Parties’ obligation to close the transactions contemplated hereunder, at Closing, the Title Policy shall be subject to no special exceptions other than the Permitted Exceptions. The premium for the Title Policy shall be paid by Purchaser Parent with no obligation to cure. Seller shall reasonably cooperate with Purchaser Parent and the Title Insurer in investigating any Title Defect and Environmental Defect parcels. Seller shall execute and deliver any reasonable affidavits typically requested by title companies from sellers of timberland and deliver the same to the Title Insurer on or before Closing, provided the same do not expose Seller to any material increased liability.

4.4 Restrictions On Conveyancing . Except as set forth in Article 5.3, Seller shall not convey, contract, or otherwise agree to convey any right, title, or interest in and to the Timberland Property to any person or entity from and after the execution of this Agreement, except for hunting and/or recreational licenses that will be cancelled on or before Closing, without the prior written consent of Purchaser Parent, which may be withheld by Purchaser Parent in its sole discretion.

Article 5
Action Prior to Closing

5.1 Hart-Scott-Rodino Filings . If required, Seller and Purchaser Parent shall each as soon as possible, but in no event later than 45 days prior to the Closing Date, file the notifications required to be filed by them with respect to the transaction contemplated by this Agreement under the provisions of the Hart-Scott-Rodino Anti-trust Improvements Act of 1976, Public Law No. 94-435, and any rules and regulations thereunder (“HSR Notifications”). Seller and Purchaser Parent shall cooperate with each other in responding to any governmental inquiry or request for further information with respect to such notifications, but neither party shall be required to defend any action that asserts the transactions contemplated by this Agreement constitute a violation of law. Seller and Purchaser Parent shall each pay one-half (1/2) of the Hart-Scott-Rodino filing fee and shall each bear their own expenses (including attorneys’ fees) in making the

required filings. Seller agrees to cooperate with Purchaser Parent in order to determine the applicability of any exemptions to filing the HSR Notifications, including but not limited to exemptions for non-productive property.

5.2 Management Of Timberland Property Lease Prior To Closing . Prior to Closing, Seller shall operate the Timberland Property consistent with past practices except that Seller shall not knowingly take any action or inaction that would violate any term, condition, or provision of this Agreement. The parties acknowledge that Seller shall continue to harvest timber on the Property and shall keep accurate records indicating the volumes of timber harvested prior to Closing. The parties further acknowledge that the Purchaser shall receive a credit against the Purchase Price at Closing based on the volume of the timber harvested and the value of the timber harvested using the values shown on the Value Table.

5.3 Agreements And Commitments . After the date of this Agreement, Seller shall not, without Purchaser Parent’s written consent, which may be withheld in Purchaser Parent’s sole discretion, enter into any new agreements, leases, contracts, or commitments relating to the Timberland Property, nor make any changes in any of the existing Land-Related Agreements, other than: (a) commitments relating to repairs, maintenance, and/or security necessary to preserve the Timberland Property; (b) hunting and/or recreational licenses that are cancelled on before Closing, (c) renewals or extensions of any of the Land-Related Agreements in the ordinary course of business; provided, however, that such renewals or extensions or new agreements, leases, contracts, or commitments shall be made in the ordinary course of business and have terms of one (1) year or less and otherwise contain the same terms. Seller shall not create, assume, or permit the creation of any lien or encumbrance, other than the lien for current taxes, upon any of the Timberland Property. Prior to Closing, Seller shall fulfill its obligations under Land-Related Agreements and Permits and shall enforce all of its material rights under Land-Related Agreements and Permits.

5.4 Inspection . Purchaser Parent will have until the Closing to inspect the Property on reasonable advance notice to Seller, among other things, to verify timber volumes located thereon and verify compliance with applicable laws, ordinances and regulations. Prior to providing access to the Timberland Property, Purchaser Parent shall deliver to Seller proof of comprehensive general liability insurance satisfactory in form and content to Seller in its reasonable discretion, and Purchaser Parent shall maintain such insurance through Closing. Purchaser Parent and its agents, representatives, employees, engineers, contractors and assigns will have the right to enter upon the Timberland Property to inspect, examine, survey and make test borings, soil bearing tests, timber cruises, and other engineering tests or surveys which it may deem necessary or advisable. Purchaser Parent hereby agrees to indemnify and hold Seller harmless from

any and all cost and expense resulting from any claims or damages caused by or relating to such inspections, examinations and tests.

5.5 Inspection Period . Purchaser Parent shall have the right, subject to the terms herein, for a period of sixty (60) days after the date of this Agreement, to enter upon, inspect, and investigate the Timberland Property, cruise the timber and to verify timber volumes, and to evaluate and verify the accuracy all data and information provided by Seller to Purchaser Parent in connection with the Timberland Property. Purchaser Parent shall have the right at any time during the Inspection Period to notify Seller and Escrow Officer that it has elected to terminate this Agreement and receive a return of the Earnest Money, plus any interest earned thereon. Upon receipt of such notice the Escrow Officer shall return the Earnest Money, plus any interest earned thereon, to Purchaser and neither party shall have any further rights or obligations hereunder, except for those obligations which by their terms shall survive such termination. If Purchaser Parent does not elect to terminate this Agreement prior to expiration of the Inspection Period as provided herein, this Agreement shall remain in full force and effect.

Article 6
Closing

6.1 Closing Date . The transfer of the Timberland Property and the purchase and sale of the Timber LLC Interests shall close on or before sixty (60) days following the expiration of the Inspection Period, but in no event later than December 14, 2007, at a time selected by Purchaser Parent upon reasonable notice to the Seller at the offices of Purchaser Parent’s Counsel, Martin Snow, LLP, 240 Third Street, Macon, Georgia, or at such other location as may be mutually agreeable to Seller and Purchaser Parent. Seller may participate in Closing by way of delivering documents in escrow.

6.2 Closing Documents . On or before the Business Day immediately prior to the Closing, the parties shall do the following:

(a)

Seller Deposits . Seller shall deposit into Escrow the following documents (each fully executed and, as to the Deeds, acknowledged): (i) the Deeds to Timber LLC, (ii) the Assignment of LLC Interests; and (iii) such other documents as Seller is required to deliver to Purchaser hereunder.

(b)

Purchaser Deposits . Purchaser shall deposit into Escrow any such fully executed documents as Purchaser is required to deliver to Seller hereunder. In addition, Purchaser shall furnish written confirmation of intention to deposit [the cash portion of the Purchase Price, less the Earnest Money Deposit,] 1 into Escrow, with the actual deposit to be made by wire funds before 12:00 noon (eastern time) on the Closing Date.

6.3 Seller’s Obligations . Seller shall deliver to Purchaser or Timber LLC, as applicable, the following:

	(a)		Board Resolution(s) . Certified copies of resolutions duly adopted by the Seller’s Board of Directors, authorizing the transactions contemplated by this Agreement (including, if applicable, the Installment Note transaction), and the execution and delivery of this Agreement.
	(b)		Executed Assignment Of LLC Interests . An executed assignment of LLC Interests.
	(c)		Seller’s Certificate Of Non-Foreign Status . An executed Seller’s Certificate of non-Foreign Status.
	(d)		Assignment And Assumption Agreement For Land-Related Agreements And Permits . An executed Assignment and Assumption Agreement for Land Related Agreements and Permits together with consents, if any, covering Seller’s rights under the Land-Related Agreements and Permits being assigned to Timber LLC on the Closing Date; provided, however, that, if a specific form is required for transfer or assignment, such form shall be used.
	(e)		Security Deposits . All security deposits held by Seller under the Land-Related Agreements, if any, shall be delivered to Timber LLC.
	(f)		Prorations . All prorated amounts due and owing to Purchaser pursuant to this Agreement.

	(g)		Affidavits . All reasonable or customary affidavits requested by the Title Insurer as provided in Article 4.2.
	(h)		Certificates Of Good Standing . Certificates of good standing of Seller in the States of Maryland and Virginia, and Timber LLC in the State of Delaware.
	(i)		Incumbency Certificate . An incumbency certificate from Seller.
	(j)		Timber Supply . The executed Stumpage Supply Agreement, in form and content substantially as provided in Exhibit P .
	(k)		Deeds . The Timber LLC Deeds.

6.4 Purchaser’s Obligations . Purchaser shall deliver or make available to Seller the following:

	(a)		Unanimous Consent Of Members(s). Certified copies of a unanimous consent duly adopted by Purchaser’s Members authorizing the purchase of the assets covered by this Agreement, and the execution and delivery of this Agreement.
	(b)		Purchase Price, Closing Costs, and Prorations . Purchaser shall pay and deliver to Seller and/or to such party or parties as Seller shall direct the Purchase Price, including the Installment Notes and closing costs and prorated amounts due and owing Seller pursuant to this Agreement.
	(c)		Certificates Of Good Standing . Certificates of good standing of Purchaser in the states of its organization and Georgia (as applicable).
	(d)		Incumbency Certificate . An incumbency certificate from Purchaser.
	(e)		Affidavits . All reasonable or customary affidavits requested by the Title Insurer.

(f)

Timber Supply. The executed Stumpage Supply Agreement, in form and content substantially as provided in Exhibit P .

6.5 Closing Statement . No less than forty-eight (48) hours prior to the scheduled Closing, the parties shall have agreed on a Closing Statement pertaining to the transaction that addresses prorations, closing costs, and similar matters.

6.6 Escrow Officer . The Escrow Officer shall do the following: (a) record the Deed(s) and any mortgages or other instruments pertaining to Purchaser’s financing of the transaction, all appropriate affidavits concerning filing the same and all fees, taxes, and costs associated with the filings; (b) deliver to Purchaser any documents that Seller is to deliver and Purchaser is to receive hereunder through Escrow; (c) deliver to Seller any documents that Purchaser is to deliver and Seller is to receive hereunder through Escrow; and (d) disburse to Seller, by wire transfer to an account designated by Seller in writing, the portion of the Purchase Price to be paid in cash less the amount of any net credit to Purchaser resulting from the prorations required hereunder and any costs that Seller is required to pay hereunder. The Escrow Officer’s performance of the foregoing actions shall be deemed to occur simultaneously.

Article 7
Closing Costs and Prorations

7.1 Closing Costs And Expenses . The costs and expenses shall be paid as specified herein. Purchaser shall have the benefits and burdens of ownership as of the Closing Date.

(a)

Seller . Seller shall pay:

	(i)		any state or local transfer taxes, documentary stamp taxes, or similar taxes charged on the consideration paid for each deed to Timber LLC and the transfer of the Timber LLC Interests to Purchaser.
	(ii)		any harvest excise taxes, timber ad valorem taxes or liens resulting from its operations prior to Closing;

	(iii)		any income taxes relating to Seller’s operations on the Timberland Property prior to the Closing;
	(iv)		any compensating taxes and penalties that may be payable due to the removal of the Timberland Property or any portion thereof from “forest land” or “timberland” or similar non-ad valorem tax classification or designation and arising solely from Seller’s actions or any change of use prior to Closing;
	(v)		any amount due to Purchaser for prorations or other sums due under this Agreement.

(b)

Purchaser Parent . Purchaser Parent shall pay at the Closing:

	(i)		the costs for title examination, title insurance commitment and the title insurance premium;
	(ii)		any costs for environmental review, Protected Species review, and any other due diligence costs of Purchasing Parties;
	(iii)		income taxes relating to the Timberland Property on or after the Closing;
	(iv)		the costs to record any instruments pertaining to Purchasing Parties’ financing of the transaction;
	(v)		any amount due to Seller for prorations or otherwise under this Agreement, and
	(vi)		any costs associated with Purchasing Parties’ financing of this transaction.

(c)

Shared Costs . Seller and Purchaser Parent shall share, split equally, and pay:

	(i)		any escrow fee;
	(ii)		the Hart-Scott-Rodino filing fee, if applicable; and
	(iii)		the cost of any survey associated with any carve-out acreage.

7.2 Prorations . Property taxes, land use income from Land-Related Agreements, and similar matters customarily prorated in similar transactions shall be prorated between the parties as of the Closing Date.

7.3 Real Property Taxes And Assessments . Current year real property taxes and assessments with respect to the Timberland Property, both general and special, shall be prorated between Seller and Purchaser Parent as of the Closing Date. The last officially certified rate and valuation shall be used for such prorations. Seller shall be solely responsible for all real property taxes and assessments applicable to the Timberland Property payable in prior years. Seller shall be solely responsible for any assessments, taxes, expenses, or contract obligations pertaining to the Timberland Property and Timber LLC arising, accruing, or incurred prior to Closing. Purchaser Parent shall be responsible for all taxes and assessments due and payable in respect of the Timberland Property and Timber LLC after Closing.

7.4 Land-Related Agreements. Seller shall be solely responsible for any contract obligations pertaining to the Timberland Property arising, accruing, or incurred prior to Closing and shall be entitled to all payments accruing under the Land-Related Agreements for the period prior to and including the Closing Date. Purchaser Parent shall be solely responsible for any obligations under the Land-Related Agreements assigned to Timber LLC by the Assignment and Assumption Agreement arising, accruing, or incurred subsequent to Closing and shall be entitled to all payments accruing under the Land-Related Agreements for the period commencing on the Closing Date as well as any security deposits, other deposits, or unearned pre-payments pertaining to the Land-Related Agreements.

7.5 Change In Tax Classification . Purchaser Parent shall be solely responsible for the payment of any taxes which may accrue any time after Closing by reason of any change in the use, zoning, land use classification or other tax classification of the Timberland Property; provided, however, that if any change in the tax classification or designation applicable to the Timberland Property, or any portion thereof changes prior to, at or after Closing solely and directly due to any deliberate act of Seller prior to Closing or due to the failure of Seller to reasonably cooperate with Purchaser

Parent in Purchaser Parent’s preparation and submittal prior to Closing of a timber management plan containing a notice of continuance acceptable to the applicable governmental authority, (which preparation and submittal Purchaser Parent agrees to diligently pursue) then Seller shall be solely responsible for payment of any compensating tax and related interest and penalties resulting therefrom, and Seller shall indemnify Purchaser Parent for such costs. Seller, at no cost or liability to Seller, agrees to reasonably cooperate with Purchaser Parent in executing and filing forms, affidavits, certificates or other documents necessary to preserve the tax status of the Timberland Property, which obligation shall survive Closing.

Article 8
Contingencies

8.1 Conditions Precedent To Purchasing Parties’ Obligation To Close . The Purchasing Parties’ obligations to consummate the transactions contemplated herein are subject to the satisfaction of each of the following conditions, and all other conditions contained herein, any or all of which may be waived by Purchaser Parent, in whole or in part, but only expressly and in writing. Satisfaction of each condition shall be determined by Purchaser Parent, in its sole discretion.

	(a)		Representations and Warranties . Seller’s representations and warranties contained in this Agreement shall be true and correct in all material respects as of the Closing Date as though made at the time of Closing and there shall have been no breach in any material respect by Seller in the performance of its agreements and covenants contained herein and each of the agreements and covenants of Seller contained in this Agreement to be performed at or prior to the Closing shall have been duly performed.
	(b)		Performance By Seller . Seller shall have materially performed all obligations required to be performed by it under this Agreement, and materially complied with all covenants for which compliance by it is required under this Agreement, prior to the Closing, including without limitation executing and delivering the agreements and documents described in this Agreement.
	(c)		Hart-Scott-Rodino . All waiting periods pursuant to the Hart-Scott-Rodino Act applicable to the transactions contemplated by this Agreement shall have expired or been terminated or Seller and Purchaser Parent shall have determined that applicable exemptions exist that exempt HSR Filings for this transaction.

	(d)		Litigation . No statute, rule, regulation, executive order, decree, ruling of any court or Governmental Authority, permanent injunction or other order shall have become effective restraining, enjoining or otherwise prohibiting or making illegal the consummation of the transactions contemplated hereby.
	(e)		Title To Timberland Property . Seller shall have delivered the Deeds to Timber LLC or to the Escrow Officer without title defects except as approved by Purchaser Parent pursuant to Article 3.4 and containing only Permitted Exceptions.
	(f)		Termination For Material Adverse Change . In the event cumulative adjustments to the Purchase Price pursuant to Article 3.4 equal ten percent (10%) or more of the Purchase Price, Purchaser Parent may terminate this Agreement prior to the Closing by written notice to Seller.

8.2 Conditions Precedent To Seller’s Obligation To Close . Seller’s obligation to consummate the transaction contemplated herein is subject to the satisfaction of each of the following conditions, and all other conditions contained herein, any or all of which may be waived by Seller, in whole or in part, but only expressly and in writing. Satisfaction of each condition shall be determined by Seller, in its sole discretion.

	(a)		Representations . Purchasing Parties’ representations and warranties contained in this Agreement shall be true and correct in all material respects as of the Closing Date as though made at the time of Closing; and there shall have been no breach in any material respect by Purchasing Parties in the performance of their agreements or covenants contained herein, and each of the agreements or covenants of Purchasing Parties contained in this Agreement to be performed at or prior to the Closing shall have been duly performed.
	(b)		Hart-Scott-Rodino . All waiting periods pursuant to the Hart-Scott-Rodino Act applicable to the transactions contemplated by this Agreement shall have expired or been terminated or Seller and Purchaser Parent shall

			have determined that applicable exemptions exist that exempt HSR Filings for this transaction.
	(c)		Litigation . No statute, rule, regulation, executive order, decree, ruling of any court or Governmental Authority, permanent injunction or other order shall have become effective restraining, enjoining or otherwise prohibiting or making illegal the consummation of the transactions contemplated hereby.
	(d)		Bankruptcy . Seller shall not be obligated or under any duty to Close this transaction in the event of the filing of any bankruptcy or insolvency petition or action by or against Purchasing Parties.
	(e)		Letters Of Credit To Seller . The Letters of Credit shall have been delivered to Seller by the Banks in such maximum aggregate amounts per Bank as are satisfactory to Seller and on terms and conditions that are consistent with the Timber Note Indicative Terms and otherwise satisfactory to Seller.
	(f)		Purchaser and Purchaser Parent shall have entered into an amended and restated limited liability company operating agreement in respect of Purchaser in form and content satisfactory to Seller.
	(g)		Purchaser shall have entered into a paying agency agreement in form and substance reasonably satisfactory to Purchaser Parent and Seller, with a third party paying agent reasonably satisfactory to Seller and Purchaser Parent pursuant to which the paying agent will make payments of amounts due and payable under the Installment Notes, hold and invest Purchaser’s excess cash and provide other customary services.
	(h)		Termination For Material Adverse Change . In the event cumulative adjustments to the Purchase Price pursuant to Article 3.4 equal ten percent (10%) or more of the Purchase Price, Seller may terminate this Agreement prior to the Closing by written notice to Purchaser.

8.3 General Provisions Regarding Contingencies And Default . If any of the foregoing conditions are not satisfied or waived in writing by Purchaser Parent or Seller, as applicable, on or before the time of Closing, then this Agreement shall

terminate and the parties shall be entitled to the remedies provided in this Agreement. Upon the failure of either party to perform a duty or obligation imposed upon it by this Agreement, the non-defaulting party shall furnish written notice to the defaulting party specifying the basis of the default (“Notice of Default”). The defaulting party shall have five (5) days after receiving the Notice of Default to cure the default before the non-defaulting party may terminate the Agreement or seek any other rights or remedies provided by this Agreement.

Article 9
Possession and Condition

9.1 Possession Of The Timberland Property . Timber LLC shall obtain possession of the Timberland Property on or before Closing, subject to any possessory rights of third parties referenced in this Agreement.

9.2 Copies Of Management Records . Seller shall deliver to Purchaser, at Closing, the documents identified in Exhibit B-2 to the extent the Seller has possession of any such documents.

9.3 Condition . Purchaser Parent and Purchaser agree that they have inspected and are thoroughly familiar with the Timberland Property and are acquiring the Timberland Property in its “as is, where is” condition subject to their due diligence rights and remedies as set forth in this Agreement.

Article 10
Representations and Warranties

10.1 Seller’s Representations and Warranties . Seller covenants, represents, and warrants as follows, which covenants, representations, and warranties are and shall be on Closing true and correct in all material respects:

	(a)		Incorporation . Seller is duly incorporated, validly existing, and in good standing under the laws of the State of Maryland and authorized to do business in Virginia.
	(b)		Authorization . Seller has all the power and authority to execute, deliver, and perform all of Seller’s obligations under this Agreement. This

			Agreement is a valid obligation binding upon the Seller in accordance with its terms.
	(c)		No Adverse Results From Sale . Neither execution nor delivery of this Agreement and the consummation of the transaction contemplated hereby will constitute: (i) an event of default under any agreement to which Seller is a party, or by which Seller is bound other than such default as would not materially affect Seller’s ability to consummate the transaction contemplated hereby; (ii) an event which would result in the creation or imposition of any valid lien, charge, or encumbrance on the Timberland Property; or (iii) a breach or violation of any permit, license, order, judgment, or decree by which Seller may be bound.
	(d)		Non-Foreign Person Certification . Seller is not a foreign person or entity, as described in the Foreign Investments in Real Property Tax Act, Internal Revenue Code § 1445.
	(e)		No Restriction . To Seller’s Knowledge, there is neither pending nor threatened, any legal action, arbitration, or administrative hearing before any Governmental Authority to which Seller is a party and that could enjoin or restrict Seller’s right or ability to perform its obligations under this Agreement.
	(f)		No Uncorrected Notices or Violation of Law . To Seller’s Knowledge, there are no outstanding or uncorrected written notices from any Governmental Authority having jurisdiction over the Timberland Property of violations of federal, state or local laws, rules or regulations applicable to Seller’s operations on the Timberland Property.
	(g)		Hazardous Substances & Underground Storage Tanks . Except as disclosed on Exhibit I , to Seller’s Knowledge, Seller has: (i) not received any written notice from any governmental agency suggesting that the Timberland Property is or may be targeted for remediation of Hazardous Substances; (ii) no knowledge of any such pending or threatened clean-up activity or of any above-ground or under-ground storage tanks on the Timberland Property; (iii) not released, discharged, or emitted and has not knowingly permitted the release, discharge or emission of any Hazardous Substances on, in, or under the Timberland Property in violation of applicable Environmental Law.

	(h)		Pesticides and Herbicides . During Seller’s ownership of the Timberland Property, Seller may have applied pesticides or herbicides to some or all of the Timberland Property. To Seller’s knowledge all such applications were done in accordance with applicable Environmental Laws and in conformance with the accepted industry standards relevant to the area in question.
	(i)		Protected Species . Except as disclosed on Exhibit I , to Seller’s Knowledge: (i) there are no Protected Species on the Timberland Property; (ii) Seller has not received any written notice of any threatened or contemplated actions against Seller or the Timberland Property based upon the presence of any Protected Species on the Timberland Property; or (iii) to Seller’s knowledge, Seller is not in violation of applicable laws concerning Protected Species. Seller makes no representation or warranty regarding the effect of the presence of any Protected Species on the use of the Timberland Property for forestry or other uses. Purchaser shall be solely responsible for determining how and under what conditions the Timberland Property can be used.
	(j)		Timber Harvest . Except as disclosed on Exhibit I , to Seller’s Knowledge, there are no outstanding contracts or agreements pursuant to which any party has the right to cut or remove timber from the Timberland Property. Seller has no knowledge of a breach of any outstanding or completed timber harvesting contract or agreement that has resulted in material unrepaired damage to the roads, soils or improvements on the Timberland Property.
	(k)		Unrecorded Documents . Except as disclosed on Exhibit I or Exhibit C , to Seller’s Knowledge, there are no unrecorded documents affecting the Timberland Property.
	(l)		Contracts Pertaining To The Timberland Property . Except as disclosed on Exhibit C , to Seller’s Knowledge, there are no current contracts, liens, agreements, easements, licenses, encumbrances, leases, or tenancies affecting or pertaining to the Timberland Property or any portion thereof. To Seller’s Knowledge, there is no material breach or claim of material breach of any current contract, agreement, license, lease, tenancy or other instrument disclosed on Exhibit C has occurred.

	(m)		Boundary Disputes & Adverse Possession . Except as disclosed on Exhibit I , to Seller’s Knowledge, there are no boundary disputes and no encroachments affecting any of the Timberland Property or portion thereof; nor to Seller’s knowledge is any person adversely possessing or using any of the Timberland Property or any portion thereof.
	(n)		Harvest Excise Tax; Etc . To Seller’s Knowledge, all timber harvest excise tax and all amounts owed to timber fellers, loggers and truckers pertaining to Seller’s harvest and removal of timber from the Timberland Property have been or will be fully paid as of the Closing; and Seller will pay when due the timber ad valorem tax for all timber harvested prior to Closing.
	(o)		Management Or Service Brokerage Agreements . To Seller’s Knowledge, there are no management, service or brokerage agreements affecting the Timberland Property to which Seller is a party or that will or may create a liability for Purchaser, or a lien or charge upon the Timberland Property.
	(p)		No Untrue Statement . None of the foregoing representations and warranties contains any untrue statements of material fact or fails to state any material fact necessary to make such representations and warranties not misleading.
	(q)		Condemnation . Except as disclosed on Exhibit I , to Seller’s Knowledge, there is no pending or threatened condemnation action affecting any portion of the Timberland Property.

10.2 Representations and Warranties of Purchaser And Purchaser Parent . Each of Purchaser Parent and Purchaser hereby make the following representations and warranties (with respect to itself), each of which is material and is being relied upon by Seller and is true as of the date hereof and will be true as of Closing:

(a)

Formation . Purchaser Parent, Glawson Investment Corp., is duly organized, validly existing, and in good standing under the laws of the State of Georgia will be in good standing in Virginia by closing. Purchaser is duly organized, validly existing and in good standing under the laws of the State of Delaware.

	(b)		Authorization . Each of Purchase Parent and Purchaser has all the power and authority to execute, deliver, and perform all of their respective obligations under this Agreement. This Agreement is a valid obligation binding upon the Purchaser Parent and Purchaser in accordance with its terms.
	(c)		No Adverse Results From Purchase. Neither execution nor delivery of this Agreement and the consummation of the transaction contemplated hereby will constitute an event of default under any agreement to which Purchaser Parent or Purchaser is a party, or by which Purchaser Parent or Purchaser is bound other than such default as would not materially affect Purchaser Parent’s or Purchaser’s ability to consummate the transaction contemplated hereby.
	(d)		No Restriction . To Purchaser Parent’s knowledge, there is neither pending nor threatened, any legal action, arbitration, or administrative hearing before any Governmental Authority to which Purchaser Parent or Purchaser is a party and that could enjoin or restrict Purchaser Parent or Purchaser’s right or ability to perform its obligations under this Agreement.
	(e)		Insolvency . To the best of Purchaser Parent’s knowledge, there are no attachments, executions, assignments for the benefit of creditors, or proceedings in bankruptcy or under any other debtor relief laws contemplated by, pending, or threatened by or against Purchaser or Purchaser Parent.
	(f)		Installment Notes . The Reimbursement Agreement, the Pledge Agreement and the Installment Note will have been duly authorized by all necessary corporate action on the part of Purchaser, and upon execution and delivery this Agreement, the Reimbursement Agreement, the Pledge Agreement and the Installment Note will constitute valid and binding obligations of Purchaser enforceable against Purchaser in accordance with their terms except as enforceability may be limited by bankruptcy, insolvency, and other similar laws affecting claims and rights generally or by general equitable principles.
	(g)		Investment Purpose . Purchaser represents and warrants that Purchaser is acquiring the Timberland Property and the Timber LLC Interests for its own account and not as nominee, agent or intermediary for any other

Person. As of the date of this Agreement, none of the Purchasing Parties has entered into any agreement to transfer or otherwise dispose of any interest in the Timberland Property or any agreement to transfer or otherwise dispose of any interest in Timber LLC, to any other Person (including another Purchasing Party) and Purchaser Parent has not entered into any agreement to transfer or otherwise dispose of any interest in Purchaser to any other Person (including another Purchasing Party), and none of the Purchasing Parties shall enter into any such agreement prior to the Closing.

	(h)		Tax Matters . Purchaser is treated as a “disregarded entity” of Purchaser Parent for U.S. federal income tax purposes and all applicable state and local income tax purposes in state and local jurisdictions following the U.S. federal income tax treatment of entities.
	(i)		No Untrue Statement . None of the foregoing representations and warranties contains any untrue statements of material fact or fails to state any material fact necessary to make such representations and warranties not misleading.
	(j)		ERISA. Purchaser represents and warrants it is not purchasing any of the Timber LLC Interests with “plan assets” of an Employee Benefit Plan subject to Title I of the Employee Retirement Income Security Act of 1974 (as amended from time to time, the “Act,” and together with any regulation, rule or judicial or administrative case, order, or pronouncement arising under or connected with the Act, “ERISA”) or of a plan subject to Section 4975 of the Code. Purchaser Parent shall take all actions reasonably requested by Seller for the purpose of ensuring, to Seller’s satisfaction, that the transactions contemplated herein will comply with ERISA and not result in an imposition of an excise tax under Section 4975 of the Code; such actions shall include, without limitation, the making of such further representations and warranties as Seller’s counsel reasonably deems necessary to ensure that neither this Agreement nor any of the transactions contemplated herein will violate ERISA or result in an imposition of an excise tax under Section 4975 of the Code. In the event that this Agreement, or any transaction or other action by Seller in connection herewith, shall be deemed to violate ERISA or result in an imposition of an excise tax under Section 4975 of the Code, Seller may immediately terminate this Agreement, the Earnest Money shall be returned to Purchaser, and no party shall have any further liability

			hereunder except for such obligations as expressly survive termination of this Agreement.
	(k)		Patriot Act/OFAC .

(i)

Compliance with International Trade Control Laws and OFAC Regulations. Purchaser and Purchaser Parent represent and warrant to Seller:

	(a)		Neither Purchaser nor Purchaser Parent is now, and neither Purchaser nor Purchaser Parent shall be at any time until Closing, a Person with whom a United States citizen, entity organized under the laws of the United States or its territories or entity having its principal place of business within the United States or any of its territories is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under United States law, regulation, executive orders and lists published by the Office of Foreign Assets Control, Department of the Treasury (“OFAC”) (including those executive orders and lists published by OFAC with respect to Persons that have been designated by executive order or by the sanction regulations of OFAC as Persons with whom U.S. Persons may not transact business or must limit their interactions to types approved by OFAC [“Specially Designated Nationals and Blocked Persons"]) or otherwise.
	(b)		Neither Purchaser nor any Person who owns a direct interest in Purchaser is now nor shall be at any time until Closing a Person with whom a U.S. Person, including a United States Financial Institution as defined in 31 U.S.C. 5312, as periodically amended (“Financial Institution”), is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under United States law, regulation, executive orders and lists published by the OFAC (including those executive orders and lists published by OFAC with respect to Specially Designated Nationals and Blocked Persons) or otherwise.

10.3 Mutual Representations & Warranties

	(a)		Commissions . Each of the Seller, Purchaser and Purchaser Parent hereby represents and warrants that it has not discussed or had any communications concerning the Timberland Property with any real estate agent or broker pertaining to this transaction, and that to the Seller’s, Purchaser’s and Purchaser Parent’s knowledge, no commissions or broker’s fees are owed on this transaction. Should any claim for a commission or finder’s fee be asserted by any third party as a result of the act or omission of either party, then the party alleged to have agreed to pay such commission or fee shall be solely responsible therefore, and shall indemnify, defend, and hold the other party harmless from any and all loss, damage, liability, cost, or expense, including, without limitation, attorneys’ fees, suffered or incurred by it arising out of or relating to any claim for real estate commission or fee made by any such real estate agent or broker.
	(b)		Instruments Of Further Assurances . Seller, Purchaser and Purchaser Parent covenant that, from time to time, whether before, at, or after the Closing Date, each of them will execute and deliver such further instruments of conveyance and transfer and take such other action as may be reasonably necessary to carry out the purposes and intents of this Agreement. By way of example, but not limitation, in the event Seller elects to cure any title defect, Seller shall execute any corrective Deed(s) reasonably necessary to cure title defects regardless of when the title defects may be discovered without charging Purchaser or Purchaser Parent any fees or expenses arising out of the corrective instruments.

10.4 Disclaimer Of Warranties; Limitation Of Liability .

(a)

No Other Representations And Warranties . Except for the representations and warranties contained in this Agreement or as are contained in the Deeds, Assignment of LLC Interests, Assignment and Assumption Agreement for Land-Related Agreements and Permits, neither Seller nor any of its agents, affiliates, officers, directors, employees, agents, representatives, nor any other person, makes or shall be deemed to make any representation or warranty to Purchasing Parties, express or implied, at law or in equity, on behalf of Seller, and Seller hereby disclaims any such representation or warranty whether by Seller or any of its agents, affiliates, officers, directors, employees, agents or

representatives or any other person, notwithstanding the delivery or disclosure to Purchasing Parties or any of their respective officers, directors, employees, agents or representatives or any other person of any documentation or other information (including, without limitation, documentation and information delivered to Purchasing Parties at Closing) by Seller or any of its agents, affiliates, officers, directors, employees, agents or representatives or any other person with respect to any one or more of the foregoing.

(b)

“As Is, Where Is” Purchase . Subject to Seller’s representations and warranties set forth herein and the Deeds, Assignment of LLC Interests, Assignment and Assumption Agreement for Land-Related Agreements and Permits and Purchasing Parties’ rights set forth in this Agreement, if any, Purchasing Parties accept the Timberland Property “as is” and “where is,” subject to the risks of all defects and conditions. Purchaser Parent acknowledges that it has had an opportunity to inspect the Timberland Property and will be relying in part on such inspections. Purchaser and Purchaser Parent, on behalf of itself, and Purchaser Parent, on behalf of Timber LLC, understand and agree that, except as expressly set forth herein, Seller has not made and makes no representations or warranties of any kind with respect to the acreage, soil stability or conditions, grades, or any other physical condition of the Timberland Property or their fitness, suitability or acceptability for any particular use or purpose whatsoever or with respect to any permits or any environmental, building, land use, zoning or fire laws or regulations or compliance therewith or with respect to the existence of any Protected Species (or Protected Species habitat) on or near the Timberland Property or compliance with any regulations pertaining thereto or the availability or existence of any access, water, sewer or utility rights; and that Seller shall not be liable for any latent or patent defects therein. Seller shall have no obligation to repair or make any improvements to the condition of the Timberland Property prior to Closing. Without limiting the generality of the foregoing, SELLER EXPRESSLY DISCLAIMS ANY IMPLIED WARRANTY OF MERCHANTABILITY, AS WELL AS ANY WARRANTY WHATSOEVER W