Deferred Compensation Plan for Directors – Willamette Industries Inc.

                           WILLAMETTE INDUSTRIES, INC.
                    DEFERRED COMPENSATION PLAN FOR DIRECTORS

                              TERMS AND PROVISIONS


1.    PURPOSE OF PLAN

            The   purpose  of  the   Willamette   Industries,   Inc.,   Deferred
Compensation  Plan for Directors  (the 'Plan') is to provide those  directors of
Willamette Industries, Inc. ('Company'), entitled to compensation by Company for
their  services as directors  ('Eligible  Directors')  with a plan in compliance
with  applicable  federal tax rules whereby one or more  Eligible  Directors may
elect to defer  receipt  of such  compensation  for such  period of  years,  not
exceeding  ten years,  commencing  after the  Eligible  Director  ceases being a
director  of Company or retires  from his or her  principal  occupation,  as the
Eligible Director may elect.

2.    ELECTION TO PARTICIPATE IN THE PLAN

            Any Eligible  Director may at any time elect to  participate  in the
Plan with  respect  to  compensation  to be  earned  thereafter  as an  Eligible
Director by  executing  and  delivering  to Company a written  election to defer
receipt  of all or a  specified  portion  of either or both of his or her annual
fees  and  meeting  fees to be  earned  for the  balance  of the  calendar  year
thereafter and for succeeding years.

3.    TERMINATION OF PARTICIPATION IN THE PLAN

            Any Eligible  Director having  previously  elected to participate in
the Plan may at any later date elect to terminate  his or her  participation  in
the Plan with respect to compensation  as a director to be earned  thereafter by
executing and delivering to Company a notice to that effect,  in which event the
amount  accumulated  pursuant to the Plan prior to notice of his or her election
to terminate will continue to be subject to the provisions of the Plan.

4.    DIRECTORS ELECTED TO FILL VACANCIES

            Any Eligible Director who was elected to fill a vacancy on the Board
of  Directors,  and who  was not an  Eligible  Director  at the end of the  last
calendar year, may elect, prior to actual receipt of any fees to which he or she
may be entitled, to participate in the Plan for the balance of the calendar year
after his or her election as well as for succeeding years.




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5.    INTEREST ON AMOUNTS DEFERRED UNDER THE PLAN

            Interest will be accrued on all amounts deferred under the Plan at a
rate equal to the three months Certificate of Deposit rate for the first working
day of each calendar quarter as quoted by the Wall Street Journal.

            A Deferred Fee Account  shall be maintained  for each  participating
Eligible  Director,  and shall consist of (1) the cumulative  amount of deferred
director's fees, less (2) payments made out of such account, plus (3) an amount,
which shall be added to the account as of the last day of each  calendar  month,
equal to (a) the balance in the account on the first day of that calendar  month
after  deducting  any  payment  made  that  day out of the  account,  times  (b)
one-twelfth  of the  interest  rate  applicable  to the calendar  quarter  which
includes the calendar month.

6.    PAYMENT OF AMOUNTS DEFERRED UNDER THE PLAN

            Amounts  deferred  under the  Plan,  together  with the  accumulated
interest as computed  above,  shall be paid in annual or quarterly  installments
over  such  period of years,  not  exceeding  ten  years,  as the  participating
Eligible   Director  may  elect.  The  Eligible  Director  may  elect  that  the
installments commence with the first day of the first calendar month immediately
following  the month in which he or she  ceases  being a  director  of  Company.
Alternatively,  the Eligible  Director may elect that the installments  commence
with the  later of (1) the first day of the  first  calendar  month  immediately
following  the month in which he or she ceases  being a director of Company,  or
(2) the first day of the calendar year  immediately  following the year in which
he or she retires from his or her  principal  occupation.  Company may rely upon
the  certification  of an Eligible  Director  that such  Eligible  Director  has
retired from his or her principal  occupation,  but reserves the right,  without
obligation  to do so, to  postpone  the  commencement  of  payments  of deferred
amounts in such cases upon advice of its tax counsel  that such  retirement  has
not effectively occurred.

7.    Election of an Eligible Director to Change Amount of
      Compensation and Terms of Payment of Amounts Deferred
      UNDER THE PLAN

            An  Eligible  Director  may at any  time  and  from  time to time by
executing and delivering a new written  election to Company elect to increase or
decrease the amount of the compensation to be deferred under the Plan, including
an increase or decrease in either or both of the  deferral of the annual fees or
meeting fees, and the terms of payments of such compensation  deferred under the
Plan, but only with respect to such  compensation to be earned  thereafter.  All
amounts  accumulated  pursuant to the Plan prior to such election shall continue
to be



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subject to the terms of any prior  election by the  Eligible  Director in effect
when such amounts were earned.  Any election,  including an Eligible  Director's
initial  election to participate in the Plan,  continues from year to year until
amended pursuant to this Seciotn 7 or until the Eligible Director terminates his
or her participation in the Plan pursuant to Section 3.

8.    DEATH OF AN ELIGIBLE DIRECTOR

            Upon the death of an Eligible Director or former Eligible  Director,
the  balance  in full of any  amounts  deferred  under the Plan,  together  with
accumulated interest,  shall be payable to his or her estate on the first day of
the first  calendar  month  immediately  following  the month in which he or she
dies.

9.    AMENDMENT OF THE PLAN

            The Plan may be amended  from time to time by  Company,  but no such
amendment  shall permit  amounts  accumulated  pursuant to the Plan prior to the
amendment to be paid to an Eligible  Director  prior to the time he or she would
otherwise be entitled thereto.

10.   TERMINATION OF THE PLAN

            The Plan will continue in effect until terminated by Company, but in
the event of such  termination,  the  amounts  accumulated  pursuant to the Plan
prior to  termination  will continue to be subject to the provisions of the Plan
as if the Plan had not been terminated.

11.   NO ASSET SEGREGATION

            The Deferred Fee Account is maintained for accounting purposes only.
The Plan does not  create an escrow  account  or trust fund or any other form of
asset  segregation  by Company  for the  benefit of any  participating  Eligible
Director.  Any assets  purchased with deferred amounts shall at all times remain
solely the property of Company,  subject to the claims of its general  creditors
and available for Company's use for whatever purpose  desired.  Amounts deferred
may not be  anticipated,  alienated,  sold,  transferred,  assigned,  pledged or
encumbered and are not liable for the debts, contracts, liabilities, engagements
or torts of the Eligible Director or his or her estate.




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