Arctic Paper: Plans to Obtain Financing Through a Contemplated Bond Issue or Facilities Agreement

Regulatory News:

The Management Board of Arctic Paper S.A. (STO:ARP) with its registered office in Poznan (the "Company") informs that on 4 May 2016 decided to formally commence work in connection with the refinancing of the Company's and its subsidiaries' existing indebtedness arising under credit facility and loan agreements concluded thereby and obtaining alternative financing (the "Financing") being considered by the Company. The main aim of the actions of the Company's Management Board is changing the structure of financing of the Company's capital group and, in particular, its centralization facilitating more effective liquidity management and flexible adjustment of the level of financing of the individual companies.

The Financing being considered envisages the procurement of funds through:

· an issue or issues of bonds denominated in PLN, which the Company would issue under the bonds issue programme for up to PLN 150,000,000 (the "Bonds Issue Programme"); and/or

· senior term and revolving facilities for up to EUR 85,700,000 and PLN 47,000,000, which would be granted to the Company by a group of banks and/or credit institutions (the "Facilities"),

whereas the funds under the Financing being considered will be procured either jointly under the Bonds Issue Programme and Facilities (in such case the amount of the Facilities will be reduced accordingly by the value of the bonds issued simultaneously with the procurement of funds under the Facilities under the Bonds Issue Programme) or exclusively through the Facilities.

If the Financing is obtained, it will be necessary to establish appropriate security and conclude additional agreements. The Management Board of the Company is considering the possibility of security that is in line with market practice in similar transactions, in particular a registered pledge or registered pledges over a collection of moveables and property rights constituting the Company's enterprise or an organized part thereof (the "Pledge").

In light of the foregoing, the Management Board of the Company will be taking steps to convene an Ordinary Shareholders' Meeting, which is necessary so that the Pledge can be established.

The above-mentioned decision of the Management Board of the Company is a preliminary decision and may change. In particular, the Management Board of the Company may decide not to take some or all the steps mentioned above. Additionally, the Management Board of the Company informs that it is in talks with banks and/or credit institutions with regard to their participation in the Financing, but at present no binding decision in the matter has been made.

This information is disclosed pursuant to the Article 56 section 1 item 1 of the Act of 29 July 2005 on Public Offering, Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies and was submitted for publication on 4th May 2016 at 6:00 pm CET, in reference to Arctic Paper’s current report no. 9/2016 filed with the Warsaw Stock Exchange.

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