SHAREHOLDERS' INTEREST

12 Months Ended

Dec. 31, 2011

SHAREHOLDERS' INTEREST

SHAREHOLDERS’ INTEREST

This note provides details about:

• preferred and preference shares,

• common shares,

• Special Dividend,

• share-repurchase programs, and

• cumulative other comprehensive loss.

PREFERRED AND PREFERENCE SHARES

We had no preferred or preference shares outstanding at the end of 2011 or 2010.

However, we have authorization to issue:

• 7 million preferred shares with a par value of $1 per share and

• 40 million preference shares with a par value of $1 per share.

We may issue preferred or preference shares at one time or through a series of offerings. The shares may have varying rights and preferences that can include:

• dividend rates,

• redemption rights,

• conversion terms,

• sinking-fund provisions,

• values in liquidation and

• voting rights.

When issued, outstanding preferred and preference shares rank senior to outstanding common shares. That means preferred and preference shares would receive dividends and assets available on liquidation before any payments are made to common shares.

COMMON SHARES

We had 536 million shares of common stock outstanding at year-end 2011.

The number of common shares we have outstanding changes when:

• new shares are issued,

• stock options are exercised,

• restricted stock units vest,

• shares are tendered,

• shares are repurchased or

• shares are canceled.

Reconciliation of Our Common Share Activity

IN THOUSANDS
	2011		2010	2009
Outstanding at beginning of year	535,976		211,359	211,289
Stock options exercised	2,199		133	1
Issued for restricted stock units	540		165	135
Issued as part of Special Dividend	—		324,319	—
Repurchased	(2,290	)	—	(66	)
Outstanding at end of year	536,425		535,976	211,359

SPECIAL DIVIDEND

To implement our decision to be taxed as a REIT, we distributed to our shareholders our accumulated earnings and profits, determined under federal income tax provisions, as a “Special Dividend.” On September 1, 2010, we paid a dividend of $5.6 billion which included the Special Dividend and the regular quarterly dividend of approximately $11 million. At the election of each shareholder, the Special Dividend was paid in cash or Weyerhaeuser common shares. The aggregate amount of cash distributed was $560 million and the number of common shares issued was approximately 324 million. Due to differences between book and tax earnings, the amount of the Special Dividend exceeded our book retained earnings. For book accounting purposes, the reduction in our retained earnings was limited to the outstanding balance of our retained earnings at the time of distribution. More information about the REIT conversion can be found in Note 1: Summary of Significant Accounting Policies.

OUR SHARE REPURCHASE PROGRAMS

During 2011, we repurchased 1,199,800 shares of common stock for $20 million under the 2008 stock repurchase program. On August 11, 2011, our board of directors terminated the 2008 stock repurchase program and approved the 2011 stock repurchase program under which we are authorized to repurchase up to $250 million of outstanding shares. During 2011, we repurchased 1,089,824 shares of common stock for $17 million under the 2011 program. As of December 31, 2011, we had remaining authorization of $233 million for future share repurchases.

During 2009, we repurchased 66,691 shares of common stock for $2 million under the 2008 stock repurchase program. All common stock purchases under both programs were made in open-market transactions.

CUMULATIVE OTHER COMPREHENSIVE LOSS

The components of our cumulative other comprehensive loss are:

DOLLAR AMOUNTS IN MILLIONS
	DECEMBER 31, 2011			DECEMBER 31, 2010
Foreign currency translation adjustments	$	411		$	419
Net pension and other postretirement benefit loss not yet recognized in earnings	(1,821		)	(1,358		)
Prior service credit not yet recognized in earnings	227			145
Unrealized gains on available-for-sale securities	4			3
Total	$	(1,179	)	$	(791	)

More information about the changes in net pension and other postretirement benefit loss not yet recognized in earnings and prior service credit not yet recognized in earnings can be found in Note 8: Pension and Other Postretirement Benefit Plans.