F O R E S T I N V E S T M E N T A S S O C I A T E S T I M B E R L A N D I N V E S T M E N T Georgia Division SAF June 26, 2006

F O R E S T I N V E S T M E N T A S S O C I A T E S Forest Investment Associates (FIA)  Founded in 1986  Main office in Atlanta  Offices in MS and PA  36 employees  1.2 million acres in 14 states  Market value = $1.7 billion

F O R E S T I N V E S T M E N T A S S O C I A T E S

Trend in Timberland Investments US TIMOS manage approximately $17.5 billion of timberland investments Over the past 10 years, assets under management have increased 16.7% annually

F O R E S T I N V E S T M E N T A S S O C I A T E S NCREIF Timberland Returns Annualized Return is 14.8% Since 1987

F O R E S T I N V E S T M E N T A S S O C I A T E S Reasons U.S. Forest Products Companies Are Selling Inefficient corporate tax structures –Double taxation of C-corporations –No capital gains treatment Timberland value is not reflected under GAAP accounting –GAAP does not allow ‘mark to market’ accounting, so assets do not reflect appreciation Stock value – the pressure to perform subsequent to recent years of acquisitions and mergers –Timberlands value is hidden and not strategic to operations –High debt on balance sheets Financial Buyers – an emerging force –Madison Dearborn Partners, Cerberus Capital, Others…