Arctic Paper S.A.

Capital/Financing Update • Oct 28, 2016

Current report No. 28/2016

Date: 28.10.2016

Subject: Confirmation of the release of security interests under thecredit facility agreement.

Content:

In reference to current reports nos. 9/2016, 20/2016 and 27/2016 themanagement board of Arctic Paper S.A. (the "Company") informs investorsthat on 28 October 2016 the Company and Arctic Paper Kostrzyn S.A. (the"Borrower") received documents confirming the release of securityinterests that have expired in connection with the repayment by theBorrower of the indebtedness under the credit facility agreement for afacility in the amount of PLN 359,000,000 (in words: three hundred andfifty nine million zlotys) dated 6 November 2012, as subsequentlyamended, amended and restated and most recently amended by amendmentagreement no. 7 dated 15 December 2015, entered into between Bank PolskaKasa Opieki S.A. ("Pekao") as security agent and lender, Bank ZachodniWBK S.A. ("BZ WBK") as lender and mBank S.A. ("mBank") as lender, andthe Borrower and Arctic Paper Mochenwangen GmbH and Arctic PaperInvestment GmbH as guarantors, and the Company as joint and severaldebtor with the Borrower and as the obligors' agent, under which Pekao,BZ WBK and mBank made available to the Borrower a multicurrency termloan facility and an overdraft facility on the terms set out in thefacility agreement (the "Facility Agreement").

The Company informs investors that it has received from the Banksdocuments confirming the release of all of the security interestsrelated to the Facility Agreement in connection with the repaymentthereof, i.e. (a) the security interests governed by Polish lawcomprising statements on submission to execution, mortgages over theBorrower's real properties, registered pledges over the Guarantors' andthe Borrower's bank accounts, powers of attorney to the Borrower's bankaccounts, registered pledges over the Borrower's shares, financialpledges over the Company's bank accounts, security assignments of claimsunder insurance policies and intercompany loans, loan subordinationagreements, and also (b) the security interests governed by German lawcomprising pledges over the Guarantors' shares, pledges over theGuarantor's and the Borrower's bank accounts, a land charge over thereal properties of Arctic Paper Mochenwangen GmbH, security assignmentof claims under the insurance policies, security assignment of machinesand loans subordination agreement.

The Company has informed investors about the establishment of thesecurity interests in connection with the Facility Agreement in currentreport no. 19/2012 dated 6 November 2012 and current report no. 27/2012dated 23 November 2012 and current report 29/2012 dated 28 November 2012.

Legal basis for the report:

Art. 17 sec. 1 of Regulation (EU) No. 596/2014 of the EuropeanParliament and of the Council of 16 April 2014 on market abuse (marketabuse regulation) and repealing Directive 2003/6/EC of the EuropeanParliament and of the Council and Commission Directives 2003/124/EC,2003/125/EC and 2004/72/EC.