TERMS

	Each Convertible Note plus accrued interest can be converted into shares at any time prior to redemption by the Note Holder at a Conversion Price of $0.55. (For example, on 19 March 2009 one Convertible Note can be converted into 3.64 shares, ignoring the effect of withholding taxes and other deductions. Note Holders may elect to reimburse Evergreen Forests for these taxes and other deductions, thus enabling the Note Holders to obtain full entitlement to 3.64 shares on conversion.)
	Each Convertible Note is redeemable in cash on 19 March 2009 for $2.00, less any withholding taxes and other deductions. This corresponds to an annualised pre-tax interest rate of 7.18%.
	Evergreen Forests has the right to give twenty business days notice of early redemption at any time, if after 19 March 2002 the share price is above $1.10 (that is twice the conversion price).
	The Convertible Notes have approved issuer levy status.
	The Convertible Notes are secured by a second ranking floating charge over the assets of Evergreen Forests. Financial covenants will restrict the amount of prior or equal ranking debt.
	The Convertible Notes are listed on the New Zealand Stock Exchange (Issuer code: EVFGA).