Vancouver, BC, Canada — Canfor has announced that, based on the recommendation of an independent committee of Canfor’s board of directors (the “Special Committee”), it has entered into an arrangement agreement (the “Arrangement Agreement”) with Great Pacific Capital Corp. (and an affiliate of Great Pacific) (“Great Pacific”).

Under the terms of the Arrangement Agreement, Great Pacific, which along with its affiliates owns approximately 51% of the issued and outstanding common shares of Canfor (a “Canfor Share”), will acquire all of the Canfor Shares it does not already own for cash consideration of $16.00 per Canfor Share (the “Consideration”) by way of a statutory plan of arrangement under the Business Corporations Act (British Columbia) (the “Transaction”).

Benefits to Canfor Shareholders In evaluating the Transaction, the Special Committee and Canfor’s board of the directors considered a number of factors, including: Ø Significant premium to unaffected market price: The Consideration represents a premium of approximately 81.8% to the closing price of the Canfor Shares on August 9, 2019 (the last trading day prior to the announcement by Great Pacific of its indicative offer for Canfor), and a premium of approximately 55.9% based on the 30-day VWAP prior to such announcement. Ø Transaction certainty: All cash offer that is not subject to financing or due diligence conditions. Ø Compelling value proposition for minority shareholders: Ongoing industry headwinds in the forestry sector, including high log costs due to supply constraints and significant declines in benchmark price for both lumber and pulp, have had negative impacts on Canfor’s current financial results. It is unknown how long the challenging industry conditions may persist and uncertain when financial results may improve as a result of capacity rationalization in British Columbia.

These challenging conditions have also led to volatility in the trading price of Canfor Shares. The Transaction provides holders of Canfor Shares, other than Great Pacific and its affiliates (the “Shareholders”), with immediate and certain value. Ø Independent valuation: The Consideration is within the fair market value range of $14.24 to $19.38 per Canfor Share determined by Greenhill & Co. Canada Ltd. (“Greenhill”), an independent financial advisor and valuator. Ø Limited strategic alternatives: Great Pacific and its affiliates currently own approximately 51% of the Canfor Shares and, as Great Pacific has indicated that it does not intend to sell any Canfor Shares, there are limited strategic alternatives available to Canfor.

Conrad Pinette, Chair of the Special Committee, said, “Over the last few months, with the assistance of the Special Committee’s independent financial and legal advisors, we have conducted a thorough evaluation of the best interests of Canfor and the fairness of Great Pacific’s proposal to Shareholders. Following the conclusion of this evaluation, we are pleased to have reached an agreement with Great Pacific. The Special Committee believes that the transaction represents fair value for Shareholders and is the correct path forward for Canfor, Canfor employees, communities and Shareholders.”

Independent Special Committee and Board of Directors Recommendations The independent Special Committee, comprised of Conrad Pinette (Chair), Hon. John Baird, Barbara Hislop and J. McNeill (Mack) Singleton, was constituted to consider the Transaction, as well as to consider alternatives to the Transaction. The Special Committee, on behalf of the Board, obtained a formal valuation (the “Valuation”) from Greenhill, as independent financial advisor and valuator, as required by Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Valuation was prepared under the supervision of the Special Committee and provides that in Greenhill’s opinion, as at October 28, 2019, and based upon and subject to the assumptions, limitations and qualifications set forth therein, the fair market value of the Canfor Shares is in the range of $14.24 to $19.38 per Canfor Share.

In addition, Greenhill has provided a fairness opinion to the Special Committee (the “Fairness Opinion”), stating that, in Greenhill’s opinion, and based upon and subject to the assumptions, limitations and qualifications set forth therein, the Consideration to be received by the Shareholders pursuant to the Arrangement Agreement is fair, from a financial point of view, to such Shareholders.

The Board, after receiving financial and legal advice, and following receipt of the Valuation and the Fairness Opinion, and the recommendation of the Special Committee, approved the Transaction, determined that the Transaction is in the best interests of Canfor and fair to Shareholders (other than Great Pacific and its affiliates) and resolved to recommend in the management information circular (the “Circular”) to be sent to Shareholders that Shareholders vote in favour of the Transaction. Glen Clark and Ryan Barrington-Foote abstained from voting on the resolution of the Board as both are executives with the Jim Pattison Group.

Barbara Hislop, a member of the Special Committee and a long-term shareholder, abstained from voting on both the resolution of the Special Committee and the resolution of the Board in respect of the Transaction. Ms. Hislop is supportive of the process followed by the Committee and the Board and believes that Shareholders should have an opportunity to consider and vote on the Transaction. However, Ms. Hislop is not prepared to commit to vote her shares in favour of the Transaction at this time. In addition, all of the directors, other than Barbara Hislop, and certain senior officers of Canfor have entered into agreements to support the Transaction and vote their Canfor Shares in favour of the Transaction.

Transaction Conditions and Timing The Transaction will be implemented by way of a Court-approved plan of arrangement under the Business Corporations Act (British Columbia) and will require the approval of: (i) 66 2/3% of the votes cast by the holders of the Canfor Shares; and (ii) a simple majority of the votes cast by the Shareholders after excluding any votes of Great Pacific and certain other persons required to be excluded under MI 61-101, all at a special meeting of Canfor’s shareholders to consider the Transaction (the “Special Meeting”). 3 The completion of the Transaction will also be subject to obtaining required court and other approvals and satisfaction of closing conditions customary for a transaction of this nature.

The Arrangement Agreement provides for customary deal protection provisions, including a non-solicitation covenant on the part of Canfor subject to customary “fiduciary out” provisions that entitle Canfor to consider and accept a Superior Proposal (as defined in the Arrangement Agreement) if Great Pacific does not match the Superior Proposal. It is anticipated that the Special Meeting to consider the Transaction will be held in December 2019. The effect of Shareholders voting for the resolution to approve the Transaction and it becoming effective will be the cancellation of the Canfor Shares from trading on the TSX following closing of the Transaction.

The Transaction is expected to close before year end. Advisors and Counsel In connection with the Transaction, Greenhill served as financial advisor to the Special Committee, DLA Piper (Canada) LLP served as legal counsel to Canfor and Osler, Hoskin & Harcourt LLP served as legal counsel to the Special Committee. Additional Information about the Proposed Transaction Copies of the Valuation and Fairness Opinion, and a description of the various factors considered by the Special Committee and the Board in their determination to approve the Transaction, as well as other relevant background information, will be included in the Circular to be sent to Canfor’s shareholders at least 21 days in advance of the Special Meeting.

The Circular, the Arrangement Agreement (including the plan of arrangement) and certain related documents will be filed with the Canadian securities regulators and will be available under Canfor’s profile on SEDAR at