November 14, 1997

Resolved: That the shareholders of Temple-Inland recommend that the board of directors immediately engage the services of a nationally recognized investment banker to explore all alternatives to enhance the value of the company, including, but not limited to, possible sale, merger, or other transaction for any or all assets of the company.

Supporting statement:

A company that goes to the public markets for capital must be competitive for that capital. This company's performance has been disappointing, trailing the S&P 500, the S&P Paper and Forest, and the S&P Savings & Loan averages over the last five years. One hundred dollars invested in Temple-Inland five years ago would be worth $127, but it would be worth $247 if invested in the S&P 500 Index, $161 if invested in the paper and forest index, and $380 if invested in the savings and loan index.

The company, which has three directors named "Temple", needs an independent review to help them determine whether the paper company should continue to be combined with either the substantial timber assets or with the financial services group.

Timber asset values have escalated enormously during the last decade, in many cases far exceeding the stated balance sheet values. The paper industry as a whole is in the midst of a restructuring trend, encompassing asset rationalizations and consolidation. And the investing public has shown an appetite for alternative investment strategies resulting in the creation of forest management partnerships. However, Temple's timber values are currently lost in the price of its stock. We believe that the company should seriously consider monetizing the timber assets.

This is also a good time to review the validity of holding the financial services subsidiaries. The savings and loan industry has been undergoing a significant consolidation, and valuation multiples have risen dramatically. It seems likely that the financial services group could be spun off to Temple-Inland shareholders tax free. We believe that this group would provide a higher value to shareholders on a stand-alone basis.

At this important transitional time for the company, it is crucial that the board have the independence, expertise, and focus required to ensure that the right questions are raised.