Sino-Forest announces bond exchange offer



    
    /NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN
    THE U.S.

    NOT FOR DISTRIBUTION TO ANY PERSON LOCATED OR RESIDENT IN THE REPUBLIC OF
    ITALY/

    This news release is not an offer for sale of securities in the United
    States. The securities have not been registered under the U.S. Securities
    Act of 1933, as amended (the "Securities Act"), and may not be sold in
    the United States absent registration or an exemption from registration
    under the Securities Act. The Company does not intend to register any
    part of the offering in the United States or to conduct a public offering
    of securities in the United States.

    Nothing in this announcement constitutes an offer of securities for sale
    in any jurisdiction where it is unlawful to do so.
    

    TORONTO, June 24 /CNW/ - Sino-Forest Corporation (TSX: TRE) today
announced that it has commenced an exchange offer whereby Sino-Forest has
offered to exchange, subject to certain conditions, any and all of its
outstanding US$300,000,000 9.125% guaranteed senior notes due 2011 (the "2004
Senior Notes") currently held by holders (i) in the United States, that are
"qualified institutional buyers" as defined in Rule 144A under the U.S.
Securities Act of 1933 (the "US Securities Act") and (ii) outside the United
States, that are persons other than "U.S. persons" as defined in Rule 902 and
in compliance with Regulation S under the US Securities Act for up to
US$300,000,000 10.25% new guaranteed senior notes due 2014 (the "Exchange
Notes"). The purpose of the exchange offer is to extend the maturity profile
of Sino-Forest's long-term debt, as well as to relax certain restrictive
covenants.
    The exchange will involve $1,000 worth of Exchange Notes being issued by
Sino-Forest for $1,000 worth of 2004 Senior Notes in accordance with the
procedures outlined in an exchange offer memorandum dated June 24, 2009. The
Exchange Notes shall bear interest at a rate of 10.25% per annum, payable
semi-annually and shall mature five years from the date of issuance. The
Exchange Notes will rank pari passu with any 2004 Senior Notes that are not
tendered pursuant to the exchange offer. Certain of Sino-Forest's subsidiaries
will guarantee the obligations under the Exchange Notes and the capital stock
of certain of Sino-Forest's subsidiaries will be pledged as collateral for
Sino-Forest's obligations under the Exchange Notes.
    The exchange offer expires at 11:59 p.m., New York City time, on July 22,
2009. 2004 Senior Notes tendered by 5:00 p.m., New York City time, on July 8,
2009 will receive an early tender payment of US$20 per US$1,000 principal
amount of validly tendered and accepted 2004 Senior Notes.
    Concurrently under a separate consent solicitation statement, Sino-Forest
is also seeking for consents from all holders of 2004 Senior Notes to amend
certain of the provisions of the indenture governing the 2004 Senior Notes.
These amendments, if approved and effected, would result in the 2004 Senior
Notes having substantially the same terms as the Exchange Notes, in particular
with respect to restrictive covenants related to incurrence of indebtedness
and the making of restricted payments. The amended 2004 Senior Notes, however,
would continue to have the same maturity date, principal amount, interest
rate, security and redemption rights. The consummation of the exchange offer
and the consent solicitation are not conditioned upon each other. However, if
both transactions are consummated and effected, 2004 Senior Notes that are not
tendered and accepted pursuant to the Exchange Offer will be subject to such
amendments pursuant to the consent solicitation. Each eligible holder of 2004
Senior Notes that consents to the proposed amendments will receive, if
accepted by Sino-Forest, a consent payment of US$10 per US$1,000 principal
amount of 2004 Senior Notes.
    Sino-Forest has engaged Credit Suisse Securities (USA) LLC as dealer
manager and solicitation agent. For more information about the exchange offer
and the consent solicitation, please contact:
    Dealer Manager and Solicitation Agent: Credit Suisse Securities (USA) LLC

    
    Credit Suisse contacts

    Hong Kong              London                      New York
    Debt Syndicate         Liability Management        Liability Management
    Group                  Group                       Group
    Tel: +852 2101 7233    Tel: +44 20 7883 6748       Tel: 800-820-1653 /
                           E: liability.management@ 212-538-1862
                           credit-suisse.com
    

    The Exchange Offering Memorandum being delivered to eligible holders of
the 2004 Senior Notes and the Consent Solicitation Statement being delivered
to all holders of 2004 Senior Notes will be available on SEDAR at
www.sedar.com.

    About Sino-Forest Corporation

    Sino-Forest Corporation (the "Company") is a leading commercial forest
plantation operator in China. Its principal businesses include the ownership
and management of forest plantation trees, the sale of standing timber and
wood logs, and the complementary manufacturing of downstream engineered-wood
products. The Company's common shares have traded on the Toronto Stock
Exchange under the symbol TRE since 1995.

    Please note: This press release contains projections and forward-looking
statements regarding future events. Such forward-looking statements are not
guarantees of future performance of the Company and are subject to risks and
uncertainties that could cause actual results and company plans and objectives
to differ materially from those expressed in the forward-looking statements.
Such risks and uncertainties include, but not limited to, changes in China and
international economies; changes in currency exchange rates; changes in
worldwide demand for the Company's products; changes in worldwide production
and production capacity in the forest products industry; competitive pricing
pressures for the Company's products and changes in wood and timber costs.
    The Exchange Offer is subject to offer and distribution restrictions in,
among other countries, the United States, the Republic of Italy, Belgium,
Canada, the European Economic Area, France, Germany, Hong Kong, Switzerland,
the United Kingdom and Singapore.
    This announcement does not constitute an offer or an invitation to
participate in the Exchange Offer in any jurisdiction in or from which, or to
any person to whom, it is unlawful to make such offer or invitation under
applicable laws. The distribution of this announcement in certain
jurisdictions may be restricted by law. Persons into whose possession this
announcement comes are required by each of the Company and the Dealer Manager
and Solicitation Agent to inform themselves about, and to observe, any such
restrictions.





For further information:

For further information: SINO-FOREST CORPORATION: Toronto: Dave Horsley
- Senior Vice President & Chief Financial Officer, Tel: (905) 281-8889, Email:
davehorsley@sinoforest.com; Hong Kong: Louisa Wong - Senior Manager, Investor
Communications & Relations, Tel: +852 2514 2109, Email:
louisa-wong@sinoforest.com

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Sino-Forest Corporation

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