GreenFirst Announces Agreement with Mahogany Investors for Sale of Duties

Press Release

TORONTO, ON – December 17, 2024 – GreenFirst Forest Products Inc. (TSX: GFP) (“GreenFirst” or the “Company”) GreenFirst, is pleased to announce a strategic agreement with Mahogany Investors, LLC regarding the sale of its entitlements to refunds, including accrued interest, related to duties imposed on softwood lumber exported from Canada to the United States during the specified period 2021 and 2022.

The agreed sale price for these entitlements is approximately $17,500,000 USD, with the potential for additional proceeds based on the timing and resolution of the ongoing trade dispute.

“This agreement underscores our commitment to strengthening our financial foundation while maintaining focus on our core business operations,” said Joel Fournier, GreenFirst’s CEO. “By monetizing these refund rights, we are unlocking value and enhancing our ability to pursue strategic initiatives. The recent rights offering, combined with today’s transaction, will provide enough liquidity to execute Phase I of our strategic expenditures plan to become the largest sawyer in Ontario and get the company closer to becoming a top quartile lumber producer.”

The duties in question pertain to deposits totaling approximately $60,000,000 USD, made during the Company’s ownership of six softwood lumber mills in Ontario and Quebec. Although the Quebec assets were divested in 2023, the Company retained the rights and obligations associated with the duties deposits, ensuring its entitlement to any potential refunds or benefits arising from the trade dispute resolution.

This transaction represents another step forward in GreenFirst’s strategy to optimize its asset portfolio and reinforce its financial position.

About GreenFirst

GreenFirst Forest Products is a forest-first business focused on sustainable forest management and lumber production. The Company owns four sawmills located in rich wood baskets, proudly operating over 6.1 million hectares of FSC®-certified public Ontario forestlands (FSC®-C167905).  GreenFirst believes that responsible forest practices, coupled with the long-term green advantages of lumber, provide the Company with significant cyclical and secular advantages in building products.

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