Uniforêt completes restructuring

New York, Aug. 8 - Uniforêt Inc. said it completed its reorganization under the Canadian Companies' Creditors Arrangement Act.

The Montreal softwood lumber company said it will make the various payments required under the plan, including the issuance of new notes and shares, by the end of September.

The plan covers Uniforêt and its subsidiaries, Uniforêt Scierie-Pâte Inc. and Foresterie Port-Cartier Inc.

Uniforêt's plan of arrangement was approved by the Quebec Superior Court on May 16.

Under the restructuring, holders of Uniforêt's old U.S. 11 1/8% senior notes due 2006 with claims of approximately C$190 million will have up to $25,000 of the principal amount owing repaid in full in cash. Above that, for each of the old notes holders will receive two new notes, one issued as part of C$60 million of new 9% series A senior notes due March 15, 2009 and one issued as part of C$40 million of new series B senior convertible notes due Sept. 15, 2008.

Principal on the series A notes will be repaid with 50% of available cash flow in fiscal 2002 and 2003 and 75% of available cash flow after that.

The series B notes will pay no interest until Sept. 15, 2004 and 7.5% annually after that. They will be convertible into Uniforêt's class A subordinate voting shares at a price of $0.50 per share.

Holders of Uniforêt's old 8% convertible unsecured subordinated debentures will receive either payment of 8% of the outstanding principal amount or have the securities converted into Uniforêt's class A subordinate voting shares at a conversion price of $6.00 per share.

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