Exhibit 99.2

 

DIRECTOR 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.	[Intentionally Omitted]	1
2.	Grant of 2006 Series C Common Units	1
3.	Representations and Warranties; Acknowledgments	5
4.	Repurchase Option	7
5.	Restrictions on Transfer	9
6.	Additional Restrictions on Transfer	11
7.	Sale of the Company	11
8.	Voting Agreement	12
9.	Definitions	12
10.	Dispute Resolution	17
11.	Notices	18
12.	General Provisions	19
13.	Code Section 280G	21
14.	Public Offering	21
15.	Joinder to LLC Agreement	22
CONSENT
SECTION 83(B) ELECTION

 

 

DIRECTOR EQUITY AGREEMENT

 

THIS DIRECTOR 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 Director Investor on the signature pages attached hereto (each a “2006 Director 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 certain service providers.

 

WHEREAS, the Company has been authorized to offer 2006 Series C Common Units to the 2006 Director Investors (the “2006 Offering”);

 

WHEREAS, such the 2006 Offering is being implemented through an offering of Units to each 2006 Director Investor conducted in compliance with Rule 701 under the 1933 Act.

 

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

 

2.                                       Grant of 2006 Series C Common Units.

 

(a)           Grant.  Upon execution of this Agreement, the Company shall grant each 2006 Director Investor the number of 2006 Series C Common Units set forth on such 2006 Director Investor’s signature page attached hereto.  The 2006 Series C Common Units acquired pursuant to this Section 2(a) shall be subject to the vesting provisions set forth in Sections 2(c) and (d) below.  The 2006 Series C Common Units being issued hereunder are being issued with a Threshold Equity Value of $908,944,420.

 

 

(b)           Section 83(b) Election.  Within 30 days after an 2006 Director Investor receives a grant of 2006 Series C Common Units from the Company, such 2006 Director 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 2006 Series C Common Units have a fair market value of $0 as of the date hereof and will be treated as such by the Company for tax reporting purposes.

 

(c)           Time Vesting 2006 Series C Common Units.

 

(i)            Except as otherwise provided in this Section 2(c), fifty percent (50%) of each 2006 Director Investor’s 2006 Series C Common Units (the “Time Vesting 2006 Series C Common Units”) will vest in accordance with the following schedule, if as of each such date, such 2006 Director Investor is and has continued to serve as a director of the Company or any of its Subsidiaries:

 

 

Notwithstanding the foregoing schedule, if a 2006 Director Investor is at least 60 years old as of December 31, 2006, the vesting schedule for such 2006 Director Investor shall be accelerated on a proportionate basis so that under such schedule 100% of the 2006 Series C Common Units are to vest on the Vesting Date that
 

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