1. We see the forest. And we see the trees. SACRS Spring Conference 2009 May 14, 2009 S UCCESSFUL S TRATEGIES = RMK T IMBERLAND G ROUP A R E G I O N S M O R G A N K E E G A N C O M P A N Y

2. RMK T IMBERLAND G ROUP 2 AGENDA  History of Timberland Investments  Why the Asset Class?  International Timber  Global Portfolio Strategy  Summary

3. RMK T IMBERLAND G ROUP 3 History of Timberland Investments We see the forest. And we see the trees. T IMBERLAND I NVESTMENT M ANAGEMENT

4. RMK T IMBERLAND G ROUP 4 HISTORY OF TIMBERLAND INVESTMENTS  Institutional Investment in Timberland Dates Back to the 1980’s  Early Investors: – Insurance Companies (Travelers) – Pension Funds (CALPERS)  Institutional Assets in Timberland

5. RMK T IMBERLAND G ROUP 5 COMMERCIAL TIMBERLAND ACRES & OWNERSHIP CANADA: 602 MM ACRES 91% PUBLIC 9% PRIVATE WEST: 203 MM ACRES $365 BILLION 63% PUBLIC 37% PRIVATE N. CENTRAL: 80 MM ACRES $40 BILLION 28% PUBLIC 72% PRIVATE SOUTH: 210 MM ACRES $210 BILLION 10% PUBLIC 90% PRIVATE NORTHEAST: 79 MM ACRES $47 BILLION 12% PUBLIC 88% PRIVATE 5

6. RMK T IMBERLAND G ROUP 6 TODAY’S INVESTORS  Pension Funds  Foundation/Endowments  Private Investors

7. Why the Asset Class? We see the forest. And we see the trees. T IMBERLAND I NVESTMENT M ANAGEMENT

8. RMK T IMBERLAND G ROUP 8 WHY THE ASSET CLASS?  Competitive Historic Returns  Low Volatility of Returns  Portfolio Diversification

9. RMK T IMBERLAND G ROUP 9 ANNUALIZED RETURNS 1.1.87 THROUGH 12.31.07

10. RMK T IMBERLAND G ROUP 10 STANDARD DEVIATION OF RETURNS 1.1.87 THROUGH 12.31.07

11. RMK T IMBERLAND G ROUP 11 CORRELATIONS TO TIMBERLAND 1.1.87 THROUGH 12.31.07

12. RMK T IMBERLAND G ROUP 12 RETURN/RISK (Sharpe Ratio) 1.1.87 THROUGH 12.31.07

13. RMK T IMBERLAND G ROUP 13 PORTFOLIO ENHANCEMENT WITH TIMBERLAND Without Timberland With Timberland Risk Return EFFICIENT PORTFOLIOS 13

14. RMK T IMBERLAND G ROUP 14 WHY THE ASSET CLASS?  Trees Grow  Growth Adds Value  “Store on the Stump”

15. RMK T IMBERLAND G ROUP 15 SOURCES OF TIMBERLAND RETURN Land (6%) Timber Price Change (33%) Biological Growth (61%) Representative loblolly pine plantation in S. Georgia (Caulfield 1998)

16. Portfolio Strategy We see the forest. And we see the trees. T IMBERLAND I NVESTMENT M ANAGEMENT

17. RMK T IMBERLAND G ROUP 17 STAGES IN THE LIFE OF A FOREST EMERGING GROWTH ESTABLISHED GROWTH PULPWOOD CHIP-N-SAW SAWTIMBER MATURE GROWTH AGE

18. International Timber We see the forest. And we see the trees. T IMBERLAND I NVESTMENT M ANAGEMENT

19. RMK T IMBERLAND G ROUP 19 “FAST GROWING PLANTATION REGION” BECOMING A REAL PRESENCE “Fast Growing Plantation” Region –Now includes Australia, Argentina, Brazil, Chile, New Zealand, Uruguay, South Africa, Swaziland Potentially Vietnam, Moçambique & others Characterized by fast tree growth, low raw material costs, low growing costs, low production costs Major new investments by global manufacturers in production and processing

20. RMK T IMBERLAND G ROUP 20 CURRENT FAST GROWING PLANTATION REGION COUNTRIES

21. RMK T IMBERLAND G ROUP 21 PLANTATION GROWTH RATES FGP REGION COUNTRIES VS. U.S. SOUTH Source: Caulfield 1998

22. RMK T IMBERLAND G ROUP 22 TWO-YEAR OLD EUCALYPTUS, SOUTH AFRICA

23. RMK T IMBERLAND G ROUP 23 MAJOR MANUFACTURING & PORT FACILITIES MANUFACTURING FACILITIES PORT FACILITIES Sao Paulo Porto Alegre 1 2 3 7 5 4 5 6 6 8 9 3 1 2 4 10

24. RMK T IMBERLAND G ROUP 24 PATULA PINE

25. RMK T IMBERLAND G ROUP 25 SABIE SAWMILL LOGYARD

26. RMK T IMBERLAND G ROUP 26 EUCALYPTUS

27. RMK T IMBERLAND G ROUP 27 PAPER MILL

28. Global Portfolio Strategy We see the forest. And we see the trees. T IMBERLAND I NVESTMENT M ANAGEMENT

29. RMK T IMBERLAND G ROUP 29 GLOBAL PORTFOLIO STRATEGY Expected Markets Real Returns Mature 6-7% Developing 10-12% Emerging 15%+

30. RMK T IMBERLAND G ROUP 30 TIMBER INVESTMENT REGIONS

31. RMK T IMBERLAND G ROUP 31 SUMMARY  Long, Successful History by Institutional Investors  Strong Portfolio Characteristics  Ability to Build Portfolios to Meet a Variety of Risk/Return Characteristics