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  "documentTitle": "Sino-Forest Corporation (TRE)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson C. Block",
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  "presentationDate": "2011-06-02 00:00:00",
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  "notes": "The slide uses a combination of quantitative data (table) and qualitative evidence (quotes from annual reports and a termination letter) to highlight discrepancies in the EJV's operations.",
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      "text": "In 1998, the Leizhou Forestry Bureau finally lost its patience and submitted a letter to COFTEC containing numerous grievances, and requesting that the EJV be terminated.",
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      "text": "TRE took a bit of a victory lap in its 1996 Annual Report, when it congratulated itself on the Leizhou EJV completing three years of profitable operations. Moreover, the Company even claimed that the Leizhou EJV carried out $412,000 of research and development that year. According to TRE, it was floating its partner (rather than the other way around) for $15.0 million:",
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      "text": "In 1998, the Leizhou Forestry Bureau finally lost its patience and submitted a letter to COFTEC containing numerous grievances, and requesting that the EJV be terminated. In addition to grievances related to the failure to inject capital and develop the MDF board factory as planned, the Forestry Bureau accused TRE of improperly removing money and making payments to a third party with which the EJV had not done business:",
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      "kind": "paragraph",
      "text": "However, in Canadian filings, the Leizhou EJV was white hot. TRE disclosed the following information regarding the EJV.",
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      "kind": "quote",
      "text": "The $14,992,000 due from the LFB [Leizhou Forestry Bureau] represents cash collected from the sale of wood chips on behalf of the Leizhou EJV. As originally agreed to by Sino-Wood, the cash was being retained by the LFB to fund the ongoing plantation costs of the Leizhou EJV incurred by the LFB.",
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      "text": "After paying one million dollars, the foreign party not only failed to fully fund the company, but also approved in its own name the gradual withdrawal of funds in the amount of RMB 4,141,045.02 RMB [approximately $500,000], from the paid in capital provided by the company for the Joint Venture, among which $270,000 USD was paid out to the Huadu Baixing Wood Products Factory (花都市百兴木制品厂), which has had no business relationship with the joint venture at all.",
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      "kind": "quote",
      "text": "“The $14,992,000 due from the LFB [Leizhou Forestry Bureau] represents cash collected from the sale of wood chips on behalf of the Leizhou EJV. As originally agreed to by Sino-Wood, the cash was being retained by the LFB to fund the ongoing plantation costs of the Leizhou EJV incurred by the LFB.” — 1996 Annual Report, p. 20",
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      "text": "17 1996 Annual Report, p.22 18 1996 Annual Information, p. 8 19 1996 Annual Report, p. 20 20 Leizhou Forestry Bureau, Letter Requesting Termination of the EJV, Appendix A5.",
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      "kind": "source-note",
      "text": "Source: 1994 ~ 1997 Annual Reports",
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      "kind": "table",
      "text": "Calculated Leizhou EJV Annual Sales According to Avg. Price and Qty in BDMT Reported by TRE",
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