Weyerhaeuser Company (the company) was incorporated in the state of Washington in January 1900 as Weyerhaeuser Timber Company. It is principally engaged in the growing and harvesting of timber and the manufacture, distribution and sale of forest products, real estate development and construction, and other real estate related activities.

The company has 35,000 employees, of whom 34,000 are employed in its timber-based businesses, and of this number, approximately 18,000 are covered by collective bargaining agreements, which generally are negotiated on a multi-year basis.

Approximately 1,000 of the company's employees are involved in the activities of its real estate and related assets segment.

The major markets, both domestic and foreign, in which the company sells its products are highly competitive, with numerous strong sellers competing in each. Many of the company's products also compete with substitutes for wood and wood fiber products. The company's subsidiaries in the real estate and related assets segment operate in highly competitive markets, competing with numerous regional and national firms in real estate development and construction and other real estate related activities.

In 1998, the company's sales to customers outside the United States totaled $1.8 billion (including exports of $1.1 billion from the United States and $700 million of Canadian export and domestic sales), or 17 percent of total consolidated sales and revenues, compared with 20 percent in 1997. The company believes these sales contributed a higher proportion of aggregate operating profits. All sales to customers outside the United States are subject to risks related to international trade and to political, economic and other factors that vary from country to country.

The company is engaged in the management of 5.1 million acres of company-owned and .2 million acres of leased commercial forestland in the United States (3.3 million acres in the South and 2 million acres in the Pacific Northwest), most of it highly productive and located extremely well to serve both domestic and international markets.

The standing timber inventory on these lands is approximately 94 million cunits (a cunit is 100 cubic feet of solid wood). The relationship between cubic measurement and the quantity of end products that may be produced from timber varies according to the species, size and quality of timber, and will change through time as the mix of these variables changes. To sustain the timber supply from its fee timberlands, the company is engaged in extensive planting, suppression of nonmerchantable species, precommercial and commercial thinning, fertilization and operational pruning, all of which increase the yield from its fee timberland acreage.

The company, through its wholly owned subsidiary, Weyerhaeuser New Zealand Inc., is responsible for the management and marketing activities of a New Zealand joint venture located on the northern end of the South Island consisting of 151,000 acres of Crown Forest License cutting rights and approximately 42,000 acres of freehold land.

The company, through its wholly owned subsidiary, Weyerhaeuser Forestlands International, is a 50 percent owner in RII Weyerhaeuser World Timberfund, L.L.P., a joint-venture partnership, which makes investments outside the United States. This joint venture owns 97 percent of a Uruguayan venture, Colonvade, S.A., which has acquired over 234,000 acres of private grazing land that is currently being converted into plantation forests. >