Exhibit 99.1

 

MANAGEMENT EQUITY AGREEMENT

 

BETWEEN

 

FOREST PRODUCTS HOLDINGS, L.L.C.

 

AND

 

EACH OF THE PERSONS

LISTED ON THE

SIGNATURE PAGES HERETO

 

Dated as of April 3, 2006

 

THE SECURITIES DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR REGISTERED OR QUALIFIED UNDER STATE SECURITIES LAWS. THE SECURITIES ARE BEING SOLD IN RELIANCE UPON EXEMPTIONS FROM SUCH REGISTRATION AND QUALIFICATION REQUIREMENTS. THE SECURITIES CANNOT BE SOLD, TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFERABILITY SET FORTH IN THIS AGREEMENT AND APPLICABLE FEDERAL AND STATE SECURITIES LAWS.

 

 

Table of Contents

 

				Page
1.		Purchase and Sale of Series B Common Units		1
2.		Grant of 2006 Series C Common Units		3
3.		Representations and Warranties; Acknowledgments		8
4.		Repurchase Option		9
5.		Restrictions on Transfer		12
6.		Additional Restrictions on Transfer		13
7.		Sale of the Company		13
8.		Voting Agreement		15
9.		Definitions.		15
10.		Dispute Resolution		20
11.		Notices		21
12.		General Provisions		22
13.		Code Section 280G		24
14.		Public Offering		24
15.		Joinder to LLC Agreement		25
CONSENT
SECTION 83(B) ELECTION

 

 

MANAGEMENT EQUITY AGREEMENT

 

THIS MANAGEMENT EQUITY AGREEMENT (this “Agreement”) is made as of April 3, 2006, between Forest Products Holdings, L.L.C., a Delaware limited liability company (the “Company”), each of the persons identified as an 2006 Employee Investor on the signature pages attached hereto (each a “2006 Employee Investor”) and Madison Dearborn Capital Partners IV, L.P. (each an “Investor”). Certain capitalized terms used herein are defined in Section 9 hereof.

 

WHEREAS, the Company has majority equity investments in Boise Cascade Holdings, L.L.C., a Delaware limited liability company (“Boise Holdings”), and in Boise Land & Timber Holdings Corp., a Delaware corporation (“Timber Holdings”); and OfficeMax Incorporated, a Delaware corporation (“OfficeMax”) has minority equity investments in Boise Holdings and Timber Holdings.

 

WHEREAS, the Company has established an incentive program under which it has issued its Series B Common Units and its Series C Common Units to Employee Investors.

 

WHEREAS, the Company has been authorized to offer additional Series B Common Units and/or its 2006 Series C Common Units to the 2006 Employee Investors (the “2006 Offering”);

 

WHEREAS, the 2006 Offering is being implemented through an offering of Units to each 2006 Employee Investor conducted in compliance with Rule 701 under the 1933 Act and described in the Company’s Private Placement Memorandum dated April 3, 2006 (the “2006 Management PPM”).

 

WHEREAS, the Company, each 2006 Employee Investor and the Investor desire to enter into this Agreement to set forth the terms and conditions relating to the issuance and sale by the Company of Series B Common Units and the grant by the Company of 2006 Series C Common Units. All Units issued hereunder or acquired hereafter by any 2006 Employee Investor are referred to herein as such 2006 Employee Investor’s “Employee Units.”

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement, intending to be legally bound, hereby agree as follows:

 

1.                                       Purchase and Sale of Series B Common Units.

 

(a)                                  Purchase and Sale. Upon execution of this Agreement, each 2006 Employee Investor shall purchase, and the Company shall sell, the number of Series B Common Units set forth on such 2006 Employee Investor’s signature page attached hereto, at a price of $2.00 per Series B Common Unit (the “Series B Common Unit Purchase Price”). The 2006 Employee Investor shall pay such purchase price to the Company by wire transfer of immediately available funds in the aggregate amount set forth on such 2006 Employee Investor’s

 

 

signature page attached hereto. The Series B Common Units acquired pursuant to this Section 1(a) shall be subject to the vesting provisions set forth in Section 1(c) below.

 

(b)                                 Section 83(b) Election. Within 30 days after each 2006 Employee Investor purchases any Series B Common Units from the Company, such 2006 Employee Investor may make an effective election with the Internal Revenue Service under Section 83(b) of the Code in the form of Annex A attached hereto, if such election is available to him or her under the Code. The parties to this Agreement agree that the Series B Common Unit Purchase Price constitutes the fair market value of the Series B Common Units as of the date hereof and will be treated as such by the Company for tax reporting purposes.

 

(c)                                  Vesting of Series B Common Units.

 

(i)                                     Except as otherwise provided in this Section 1(c), each 2006 Employee Investor’s Series B Common Units will vest in accordance with the following schedule, if as of each such date, such 2006 Employee Investor is and has continued to be employed by the Company or any of its Subsidiaries: