This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

Transcription

1 NORSKE SKOGINDUSTRIER ASA ANNOUNCES EXTENSION OF AND AMENDMENTS TO EXCHANGE OFFER AND CONSENT SOLICITATION FOR THE EUR 218,106, % SENIOR NOTES DUE 2017 (ISIN: XS ). March 18, 2016 NORSKE SKOGINDUSTRIER ASA (the Parent ) announces today that it is extending the Expiration Deadline and amending the terms and conditions of its invitation to holders (subject to the offer restrictions referred to below) of the outstanding EUR 218,106, % senior notes due 2017 (the 2017 Notes ) to offer to exchange their 2017 Notes for the applicable consideration, to be comprised of the exchange notes due 2026 (the Exchange Notes due 2026 ), the perpetual notes (the Perpetual Notes ) and the right to subscribe in cash for ordinary shares ( Ordinary Shares ) of the Parent (the Equity Subscription Rights ) (collectively, the 2017 Notes Exchange Offer or the Exchange Offer ) and the Parent s solicitation of consents to certain amendments to the 2017 Notes (the Consent Solicitations, and together with the Exchange Offer, the Exchange Offer and Consent Solicitations ). The Exchange Offer and Consent Solicitations are made on the terms and subject to the conditions set out in the exchange offer and consent solicitation memorandum dated January 5, 2016, as supplemented by supplement no. 1 dated February 4, 2016, supplement no. 2 dated February 24, 2016 and supplemented no. 3 dated March 11, 2016 (the Exchange Offer and Consent Solicitation Memorandum ) and, as amended, will expire at 12:00 noon, London time, on April 6, 2016 (subject to the right of the Issuer to extend, re-open or terminate the Exchange Offer and Consent Solicitations) (the Expiration Deadline ). The amended terms and conditions are set forth in supplement no. 4 dated March 18, 2016 (the Supplement ) to the Exchange Offer and Consent Solicitation Memorandum. Other than as set forth in the Supplement, all terms of the Exchange Offer and Consent Solicitations remain unchanged. Copies of the Exchange Offer and Consent Solicitation Memorandum and the Supplement are available to Eligible Holders of the 2017 Notes from the Exchange and Tabulation Agent as set out below. Capitalized terms used in this announcement but not defined have the meanings given to them in the Exchange Offer and Consent Solicitation Memorandum. This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act. Amendment to Exchange Offer and Consent Solicitations The Parent has decided to terminate the Exchange Offer in respect of the 2016 Notes. The Parent will not accept any 2016 Notes that have been tendered in the 2016 Notes Exchange Offer and any 2016 Notes that have been tendered in the 2016 Notes Exchange Offer will be returned to their respective Holders. The Exchange Offer Consideration in respect of the 2017 Notes is amended. Holders of 2017 Notes accepted by the Parent for exchange will receive, on the Settlement Date, a combination of (i) Exchange Notes due 2026 with an aggregate amount equal to 46.8% of the aggregate nominal amount of the 2017 Notes validly offered and accepted for exchange, plus the 2017 Notes Accrued Interest Payment (which amount will be deemed to be paid by adding such amount to the aggregate principal amount of the Exchange Notes due 2026 issued on the Settlement Date), and (ii) Perpetual Notes with an aggregate amount equal to 36.2% of the aggregate nominal amount of the 2017 Notes validly offered and accepted for exchange. 1

2 A brief summary of the commercial terms of the Exchange Offer is set forth in the table below. Notes to be Exchanged ISIN Amount Outstanding as of December 31, 2015 (1) Exchange Ratio Exchange Offer Consideration 218,106, % Senior Notes due 2017 ISIN: XS ,106, % An amount of Exchange Notes due 2026 of the Parent equal to the Exchange Ratio multiplied by the aggregate nominal amount of 2017 Notes exchanged, plus the 2017 Notes Accrued Interest Payment. A brief summary of the terms of the Exchange Notes is set forth in the table below. 36.2% An amount of Perpetual Notes of the Parent equal to the Exchange Ratio multiplied by the aggregate nominal amount of 2017 Notes exchanged % The right to subscribe in cash for ordinary shares of the Parent at a price of NOK 2.24 per share in an amount equal to the Exchange Ratio multiplied by the aggregate nominal amount of 2017 Notes exchanged. Title Exchange Notes due Perpetual Notes... Issue Amount Issue Price Interest Maturity Date Up to million 100% 3.5% cash/3.5% PIK per annum December 30, 2026 Up to 79.0 million 100% 2.0% per annum December 30, 2115 As a consequence, the Minimum Offer Amount to receive the full Exchange Notes Consideration in respect of the 2017 Notes is reduced from 491, to 277, To participate in the Exchange Offer, Holders must validly offer for exchange at least 277, aggregate principal amount of 2017 Notes. In order to participate in the Exchange Offer, a Holder that, as of the date of this exchange offer and consent solicitation memorandum, holds 2017 Notes having an aggregate nominal amount less than the Minimum Offer Amount must first acquire such further 2017 Notes as is necessary for that Holder to be able to offer for exchange the Minimum Offer Amount. If a Holder holds at least 214, of the 2017 Notes (but less than 277,000.00) and does not acquire additional 2017 Notes to reach the Minimum Offer Amount, the Holder may nevertheless elect to participate in the Exchange Offer and receive only Exchange Notes due 2026 at the applicable Exchange Ratio (and will not receive any Perpetual Notes or any other consideration). Waiver and amendment of certain Conditions to the Exchange Offer and Consent Solicitations The Minimum Acceptance Condition is waived, provided that at the time of the waiver the Parent has received sufficient instructions to pass the Extraordinary Resolution adopting the 2017 Notes Proposal and the Parent irrevocably agrees to pass the Extraordinary Resolution prior to the Settlement Date. The Parent intends to accept all the 2017 Notes validly offered by Eligible Holders for exchange in the Exchange Offer. If the threshold for the Consent Solicitations in respect of the 2017 Notes is attained on the Expiration Deadline and the Extraordinary Resolution is passed, the Proposals in respect of the 2017 Notes will become operative, and Holders of the 2017 Notes that are not tendered and accepted pursuant to the Exchange Offer will be subject to the terms of the 2017 Notes as modified notwithstanding that they did not tender their 2017 Notes or otherwise deliver consents. As of 5:00 p.m., London time, on March 17, 2016, more than the required 75% of aggregate principal amount of the 2017 Notes provided consents to the Proposals and the Parent intends to pass the Extraordinary Resolution at the 2017 Notes Meeting. The condition relating to the receipt of not less than 10.0 million in aggregate gross proceeds from subscriptions to the Parent s Ordinary Shares in the context of the Exchange Offer is amended to include 2

3 aggregate gross proceeds from the sale of the Parent s Ordinary Shares through private placement transactions. Amendment to The Proposals Proposed Amendments to the 2017 Notes The Parent is amending the 2017 Notes Proposal. A brief summary of the terms of the revised 2017 Notes Proposal is set forth below. The 2017 Notes have been issued pursuant to the 2017 Notes Agency Agreement. The 2017 Notes Proposal, if passed, will amend the 2017 Notes (including the 2017 Notes Agency Agreement) to add an optional redemption and mandatory exchange option to provide that the 2017 Notes may be redeemed at any time at the option of the Parent in return for the Exchange Offer Consideration offered pursuant to the Exchange Offer. The Parent intends to exercise the optional redemption and mandatory exchange option in respect of all 2017 Notes not tendered in the Exchange Offer on the Settlement Date. From and after the time that the Parent exercises the optional redemption and mandatory exchange option in respect of the 2017 Notes, (a) such 2017 Notes shall be deemed to be discharged, (b) such 2017 Notes will not be transferable and (c) Holders of such 2017 Notes will have no further rights in respect of those 2017 Notes other than receipt of the Exchange Offer Consideration. In order for the 2017 Notes Extraordinary Resolution to be adopted at the 2017 Notes Meeting, the requirements described under Exchange Offers and Consent Solicitations The Consent Solicitations Procedures Relating to Meetings of Holders in the exchange offer and consent solicitation memorandum must be satisfied. The 2017 Notes Proposal will be effective and operative when the Extraordinary Resolution is adopted and once the Settlement Date occurs. The Settlement Date occurring is a condition precedent to the 2017 Notes Proposal being legally effective and operative Agency Agreement Section Reference Clause (7) of Schedule (4)... Description of Amendment Redemption and Purchase. Clause (7) will be amended to add further provisions that provide that the 2017 Notes shall be, at the option of the Parent, redeemable at a redemption price in an amount equal to, the 2017 Notes Redemption/Exchange Consideration or mandatorily exchangeable for the 2017 Notes Redemption/Exchange Consideration, a definition of term 2017 Notes Redemption/Exchange Consideration shall be added to mean: a combination of debt securities of the Parent consisting of (i) the Parent s Exchange Notes due 2026 with an aggregate amount equal to 46.8% of the aggregate nominal amount of the 2017 Notes so redeemed or exchanged and (ii) the Parent s Perpetual Notes with an aggregate amount equal to 36.2% of the aggregate nominal amount of the 2017 Notes so redeemed or exchanged (or, if determined by the Parent, with respect to any part of such 2017 Notes, the right to receive a cash payment within a specified period of time), a definition of term Exchange Notes due 2026 shall be added to mean: debt securities of the Issuer having a maturity of 30 December 2026 and issued on or about 12 April 2016 and a definition of term Perpetual Notes shall be added to mean debt securities of the Issuer having a maturity of 30 December 2115 and issued on or about 12 April Conforming Changes... The remaining provisions of the 2017 Notes Agency Agreement and the 2017 Notes shall be amended as is necessary to give effect to 2017 Notes Proposal. For the avoidance of doubt, if the Extraordinary Resolution in respect of the 2017 Notes is passed, Non- Participating Holders will not be able to tender their 2017 Notes in exchange for the 2017 Notes Exchange Offer Consideration that would have been payable to such Non-Participating Holder on the Settlement Date had such Non-Participating Holder validly tendered their 2017 Notes for exchange prior to the Expiration Deadline. 3

4 Amendment to The Transactions Summary of Agreement with GSO and Cyrus On March 18, 2016, the agreement among the Parent and GSO and Cyrus dated as of December 18, 2015 (the Support Agreement ) that had been approved by the Parent s Board of Directors on December 21, 2015 (as amended, the Amended Support Agreement ) has been amended to include the following key provisions: the Parent will amend and supplement the exchange offer and consent solicitation memorandum by way of a supplement; the Parent will terminate the 2016 Notes Exchange Offer in respect of the 2016 Notes; the Parent will waive the Minimum Acceptance Condition, provided that at the time of the waiver the Parent has received sufficient instructions to pass the Extraordinary Resolution adopting the 2017 Notes Proposal and the Parent irrevocably agrees to pass the Extraordinary Resolution prior to the Settlement Date; the Exchange Offer Consideration in respect of the 2017 Notes will be amended to be comprised of (i) Exchange Notes due 2026 based on an exchange ratio of 46.8% of notional 2017 Notes exchanged, plus accrued interest in respect of 2017 Notes, and (ii) Perpetual Notes based on an exchange ratio of 36.2% of notional 2017 Notes exchanged; the Consent Solicitations in respect of the 2017 Notes will be amended to (i) provide that any Non- Consenting Holders of the 2017 Notes will receive the same Exchange Offer Consideration as participating holders in the Exchange Offer, (ii) delete the provisions of the 2017 Notes Proposal that were initially contemplated and (iii) delete the entitlement of Holders to receive the Residual 2017 Exchange Notes Consideration; and the commitments of GSO and Cyrus to provide the Norwegian Receivables Facility are terminated. Amendment to The Transactions The Exchange Offers and Transactions Under the Support Agreement, GSO and Cyrus committed to tender their holdings of the 2017 Notes in the Exchange Offers and Consent Solicitations, which holdings (together with the 2017 Notes that have been acquired from the Parent) represent 68.2%, respectively, of the outstanding 2017 Notes. GSO and Cyrus subsequently acquired the Parent s treasury holdings and have tendered their 2017 Notes in the Exchange Offers. As of March 17, 2016, the Parent had received tenders of more than 75% of the 2017 Notes, and had received consents in respect of the Proposals of over 75% (which is the threshold required to pass the Proposals and thus bind all of the outstanding 2017 Notes to the terms of the Proposals). On February 2, 2016, the New York State Supreme Court issued a temporary restraining order preventing the closing of the Exchange Offers. The temporary restraining order had been requested by Citibank, N.A., London Branch in its capacity as trustee under the indenture (the Indenture ) for the Senior Secured Notes (the Plaintiff ). After the defendants in this action removed the case to federal court, on March 8, 2016, the United States District Court for the Southern District Court of New York issued an Order No. 16-cv-850 (RJS)(the Order ) denying the motion of the Plaintiff for a preliminary injunction to prevent the closing of the Exchange Offers, on the basis that the Plaintiff had not demonstrated that it would suffer irreparable harm in the absence of the requested injunction. The Order also lifted the temporary restraining order in respect of the Exchange Offers that had been imposed by the New York State Supreme Court on February 2, In its Order denying the injunction, the Court found preliminarily, on the limited record before it, that the Plaintiff had shown a sufficient likelihood that it would be successful in proving, after a full trial on the merits of its claim, that the proposed Exchange Offer, if consummated, would violate a term of the Indenture. The Parent strenuously disagrees with this interpretation of the Indenture, and the Parent will vigorously contest this view if and when appropriate. Among other things, the Parent notes that the Court was presented only with the question as to whether the Plaintiff had shown a likelihood of success or serious questions going to the merits of its proffered interpretations of the Indenture to make them fair ground for litigation, all based upon the highly expedited and limited preliminary injunction record before the court. As such, the Parent notes that the Court s preliminary observations did not constitute a final determination by 4

5 the Court on the matter, which would be the subject of a future trial on the merits. Nevertheless, due to the present uncertainty with respect to the court case and the compelling need of the Company to undertake a transaction to resolve uncertainties regarding its liquidity and upcoming maturities as expeditiously as possible and before any trials on the merits, the Parent has decided to amend the terms of the Exchange Offers and Consent Solicitations. As described above, the Parent entered into the Amended Support Agreement with GSO and Cyrus, which was approved by the Parent s Board of Directors. On March 18, 2016, the Parent terminated the Exchange Offer in respect of the 2016 Notes, amended the Exchange Notes Consideration in respect of the 2017 Notes and waived the minimum tender condition in respect of the 2017 Notes. Based on the level of tenders and consents received to date, the Parent presently does not intend to extend the Expiration Deadline of April 6, 2016 and, following the Expiration Deadline, the Parent s Board of Directors will determine whether or not to accept the tenders and consents in the 2017 Notes Exchange Offer and Consent Solicitations and to complete the 2017 Notes Exchange Offer and Consent Solicitations. The termination of the 2016 Notes Exchange Offer (and the failure to extend the maturity of the 2016 Notes on June 15, 2016 until 2019 (and later dates)), together with the other liquidity needs of the Group, including working capital, capital expenditures and servicing of interest on indebtedness, present the Group with significant liquidity challenges in As described under the caption Amendment to Recent Developments, the Parent has entered into the Financing Agreement with GSO and Cyrus in order to provide certain financing sources. However, the availability of the liquidity measures contemplated by the Financing Agreement is subject to certain conditions precedent. In addition, there can be no assurance that the liquidity measures under the Financing Agreement will be sufficient to ensure the continued viability of the Parent, particularly if there are adverse developments in industry conditions or in the Group s business. If the Exchange Offer and Consent Solicitations are not completed and the liquidity measures contemplated by the Financing Agreement are not available, the very material uncertainty surrounding the Group s liquidity position in 2016 and 2017 may cause and/or require the officers and directors of subsidiary operating companies in the Group to consider whether they can continue to provide monies to the Parent, which the Parent relies upon to satisfy its liabilities. Likewise, if the Exchange Offer and Consent Solicitations are not completed and the liquidity measures contemplated by the Financing Agreement are not available, the Parent s independent auditors would likely issue an audit opinion on our December 31, 2015 consolidated financial statements on a qualified basis as to their assumption of our ability to continue as a going concern, which could raise concerns among our trade creditors and other finance providers. In such circumstances, the Parent would be forced to consider any and all available options, which may include a non-consensual comprehensive balance sheet restructuring of the Parent. If the Exchange Offer and Consent Solicitations are not completed and the Parent is not able to obtain other sources of liquidity in an amount necessary to meet the June 15, 2016 maturity date of the 2016 Notes (none of which sources are presently foreseen), the Parent is likely to default on such payment causing the Parent (and other Norwegian subsidiaries) to need to seek applicable relief under Norwegian law. The available Norwegian processes have a poor track record of rehabilitating companies of the Group s size and complexity and instead often result in a liquidation, which in the Group s case, would have to occur across several jurisdictions and would dramatically impair recoveries for the Group s creditors. There can be no assurance that the Exchange Offer and Consent Solicitations will be completed or that the liquidity measures contemplated by the Financing Agreement will be available or otherwise sufficient to meet the liquidity needs of the Group. We believe that the successful completion of the Exchange Offer and Consent Solicitations will protect value for all of our stakeholders and position us to take advantage of a cyclical improvement in the publication paper industry cycle. The completion will also provide protection of the position of holders of the 2016 Notes and the 2017 Notes. After the completion of the Exchange Offer and Consent Solicitations, we will still have significant cash interest expense, high financial leverage and significant debt repayment obligations due in 2016 and Amendment to Recent Developments On March 15, 2016, the Parent s Board of Directors decided to write-down certain deferred tax assets in Norway and Australasia. As a consequence, on March 18, 2016, the Parent released the Group s revised financial statements for the quarter ended December 31, Changes to the Group s unaudited quarterly 5

6 report for the quarter ended December 31, 2015 are limited to a minimal number of items. In particular, the revised book equity following the write-down of certain deferred tax assets is NOK 72 million. However, the impairment process has revealed significant disagreements between the Parent and its independent auditors with respect to the fixed asset value. The Parent believes that there is sufficient headroom to support the existing book values of the fixed assets, based on the applicable valuation principles and the industry outlook. Due to those significant disagreements, the Parent and its independent auditors have mutually agreed that a new auditor should be elected for the Parent at the annual general meeting scheduled for April On March 18, 2016, in order to address (in part) the liquidity challenges faced by the Group in 2016, a financing agreement has been reached among GSO and Cyrus and the Parent, and approved by the Parent s Board of Directors (the Financing Agreement ) and includes the following key provisions: GSO and Cyrus will provide a new securitization facility (the NSF ) in a nominal amount of approximately 110 million, which facility will be secured by the receivables and inventory of the mills of Norske Skog Saugbrugs AS and Norske Skog Skogn AS, the inventory of the mill of Norske Skog Golbey AS and certain collection bank accounts, the proceeds of which will be used to replace the SpareBank 1Gruppen Finans AS Factoring Agreements and for general corporate purposes (other than the repayment of any public debt); If requested by the Company, GSO and Cyrus will purchase for cash, on or before December 30, 2016, up to 10 million aggregate principal of senior secured debt instruments; Before March 30, 2016, GSO and Cyrus will purchase for cash 15 million of Ordinary Shares of the Parent at a price of NOK 2.24 per share; and The Parent will use its best efforts to commence a sales process and consummate a sales transaction for Group s Tasman geothermal power plant (the New Zealand Power Plant ) prior to May 15, 2016, and GSO and Cyrus will provide certain financing commitments of up to 20 million in connection with such potential sale of the New Zealand Power Plant. The Financing Agreement provides that the commitments of GSO and Cyrus under the Financing Agreement are several and not joint and are subject to certain conditions, including (as applicable), satisfactory definitive documentation and completion of satisfactory commercial and legal due diligence. Amendment to Trading Update On February 5, 2016, the Parent released the Group s unaudited quarterly report for the quarter ended December 31, 2015, which is incorporated by reference herein and is available at On March 18, 2016, the Parent released the Group s revised financial statements for the quarter ended December 31, 2015 reflecting the impairment discussion between the Parent and their independent auditors. The Group s revised financial statements for the quarter ended December 31, 2015 are incorporated by reference herein and are available at On March 18, 2015, the Parent released the following trading update and outlook for the six months ending June 30, 2016: No consolidated financial statements have been prepared for any period in The information in this trading update and outlook in respect of 1H16 is based on preliminary internal management accounts and includes estimates and assumptions, and is subject to change as the group s consolidated financial statements are finalized, as further described herein. Undue reliance should not be placed on the information in this statement. P&L The prices for publication paper in Europe have improved year-to-date from the level experienced in 2H15. Seasonally lower sales volumes in the first half of the year compared to the second half are expected to offset the positive price effect to a certain degree. Prices in Australasia have remained relatively stable year- 6

7 to-date from 2H15, reflecting a higher export share offsetting improved Asian newsprint prices. Sales volumes in Australasia are also expected to be seasonally lower in the first half compared to the second half. A one-off cost benefit in Australasia in the fourth quarter of last year supported GOE in 2H15. Year-to-date, NOK has on average been stronger to GBP and weaker to EUR and USD compared to 2H15. AUD has on average been stronger to NOK and somewhat weaker to USD. Underlying fixed costs continue to trend down and variable costs are positively impacted by lower energy costs. Other activities, a cost centre supporting the business units, were positively impacted by year-end effects in 2H15. Cash flow Cash flow from operations are expected to be positive before interest payments in 1H16, despite a seasonal build of working capital. Capital expenditures in 1H16 are expected to be at similar levels to the reported figure for 2H15. The Group s cash and cash equivalent balances at the end of February 2016 was in the range of NOK 500 million. Balance sheet A successful completion of the proposed equity and liquidity initiatives and the exchange offer to 2017 note holders would significantly improve cash balances and equity level for the group. The contemplated transactions, if completed, would also directly enhance liquidity through reduced cash interest payments. To allow for daily volatility in working capital, the group needs a liquidity buffer of around NOK 200 million beyond restricted cash of approximately NOK 250 million. Reported debt will, if the current NOK appreciation to EUR and USD from year-end were to remain unchanged, decrease somewhat. This positive translation effect would mitigate the negative equity effect from interest and depreciation charges through the P&L. The completion of the proposed exchange offer to 2017 note holders would significantly reduce reported debt. Outlook The market balance for newsprint and magazine paper in Europe is continuing to improve with recent announcements of capacity closures adding to the benefits experienced from closures last year. This gives momentum to the positive pricing environment. Gross operating earnings (GOE) for the first six months of 2016 is expected to be above NOK 500 million. Reflecting closures and planned conversion projects out of publication paper in the industry, European operating rates for newsprint and LWC are expected to remain above 90% in both 2016 and 2017, after taking into account an expected secular decline in demand. The European SC market is gaining support from closures in North America. The Asian export market for newsprint, of increasing importance to Norske Skog due to a smaller domestic market in Australasia, is encouraging with prices improving. Favourable energy costs for our European mills and efficiency measures at all mills are expected to reduce variable costs by 2-3% per tonne in Fixed costs initiatives continue at all mills towards a run-rate group level of NOK 600 million per quarter by year-end The growth initiatives announced last year are expected to start to contribute to gross operating earnings this year and are expected to reach full run-rate within a timeframe of 3-4 years. Amendment to Expiration Deadline and Expected Timetable of Events The Exchange Offer and Consent Solicitations, previously set to expire at 12:00 noon, London time, on March 21, 2016 have been extended and are now set to expire at 12:00 noon, London time, on April 6, As of 5:00 p.m., London time, on March 17, 2016 more than 40% of the aggregate principal amount of the 2016 Notes and approximately 75% of the aggregate principal amount of the 2017 Notes have been tendered in the Exchange Offer. 7

8 As a result, the Expected Timetable is amended as follows: Expiration Deadline Final deadline for receipt of valid Exchange Instructions or Electronic Voting Instructions by the Exchange and Tabulation Agent in order for Holders to participate in the Exchange Offer and/or the Consent Solicitations. Time and Date of Meeting Expected time and date of Meeting of Holders of the 2017 Notes. Announcement of Results Announcement by the Parent of whether the Parent will accept valid offers of 2017 Notes for exchange pursuant to the Exchange Offer and, if so accepted, (i) the final aggregate nominal amount of 2017 Notes accepted for exchange, (ii) the aggregate nominal amount of each series of Exchange Notes to be issued on the Settlement Date, (iii) the results of Meeting (or, if applicable, any adjourned Meeting) and (iv) the aggregate nominal amount of 2017 Notes that will be outstanding following the Settlement Date. Adoption of Extraordinary Resolutions If an Extraordinary Resolution is passed at the first Meeting in respect of the 2017 Notes, execution of documentation amending the 2017 Notes Agency Agreement applying such Extraordinary 12:00 noon (London time) on April 6, :00 p.m. (London time) on the later of (i) April 11, 2016 and (ii) the third business day following the Expiration Deadline, as currently scheduled or otherwise extended by the Parent As soon as reasonably practicable after the date of the Meeting. On or about April 11, Resolution. Expected Settlement Date Expected settlement date for the Exchange Offer. On or about April 12, Notwithstanding the above, the Parent reserves the right to extend, re-open or terminate the Exchange Offer and the Consent Solicitations. Securityholders are advised to read carefully the Exchange Offer and Consent Solicitation Memorandum for full details of and information on the procedures for participating in the Exchange Offer and the Consent Solicitations. Lucid Issuer Services Limited is acting as Exchange and Tabulation Agent. Questions and requests for assistance in connection with the Exchange Offer and the Consent Solicitations may be directed to the Parent. Norske Skog Norske Skog media Vice President Corporate Communication Carsten Dybevig exchangeoffer@norskeskog.com Norske Skog financial markets Vice President Investor Relations Tom Rogn exchangeoffer@norskeskog.com Questions and requests for assistance in connection with the delivery of Exchange Instructions may be directed to the Exchange Agent and Tabulation Agent. 8

9 Exchange and Tabulation Agent Lucid Issuer Services Limited Tankerton Works 12 Argyle Walk London WC1H 8HA United Kingdom For information by telephone: Attention: Thomas Choquet/Yves Theis DISCLAIMER This announcement must be read in conjunction with the Exchange Offer and Consent Solicitation Memorandum and the Supplement. This announcement, the Exchange Offer and Consent Solicitation Memorandum and the Supplement contain important information which should be read carefully before any decision is made with respect to the Exchange Offer and Consent Solicitations. If you are in any doubt as to the contents of this announcement, the Exchange Offer and Consent Solicitation Memorandum or the Supplement or the action you should take, you are recommended to seek your own financial and legal advice, including as to any tax consequences, immediately from your stockbroker, bank manager, solicitor, accountant or other independent financial or legal adviser. Any individual or company whose 2017 Notes are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee or intermediary must contact such entity if it wishes to offer 2017 Notes for exchange pursuant to the Exchange Offer. Neither the Exchange and Tabulation Agent nor the Parent makes any recommendation as to whether Noteholders should offer 2017 Notes for exchange pursuant to the Exchange Offer. OFFER AND DISTRIBUTION RESTRICTIONS Neither this announcement, the Exchange Offer and Consent Solicitation Memorandum, nor the Supplement constitutes an invitation to participate in the Exchange Offer and Consent Solicitations in any jurisdiction in which, or to any person to or from whom, it is unlawful to make such invitation or for there to be such participation under applicable securities laws. The distribution of this announcement, the Exchange Offer and Consent Solicitation Memorandum and the Supplement in certain jurisdictions may be restricted by law. Persons into whose possession this announcement, the Exchange Offer and Consent Solicitation Memorandum or the Supplement comes are required by the Parent and the Exchange and Tabulation Agent to inform themselves about, and to observe, any such restrictions. No action has been or will be taken in any jurisdiction by the Parent or the Exchange and Tabulation Agent in relation to the Exchange Offer that would permit a public offering of securities. United States Neither the Exchange Offer nor the Exchange Notes have been registered under the United States Securities Act of 1933, as amended (the Securities Act ) or any other securities laws and the Exchange Offer is only directed at, and the Exchange Notes are only being offered and will only be issued to, holders of record of 2017 Notes who can represent that they are either (i) qualified institutional buyers ( QIBs ) (as defined in Rule 144A ( Rule 144A ) under the Securities Act) or (ii) outside the United States and not US persons (as defined in Regulation S under the Securities Act ( Regulation S )) and are lawfully able to participate in the Exchange Offer in compliance with applicable laws of applicable jurisdictions (each such person, an Eligible Holder ). Only Eligible Holders are authorized to receive or review the Exchange Offer and Consent Solicitation Memorandum and the Supplement or to participate in the Exchange Offer and the Consent Solicitations. For a description of restrictions on transfer of the Exchange Notes, see Transfer Restrictions in the Exchange Offer and Consent Solicitation Memorandum. United Kingdom The communication of the Exchange Offer and Consent Solicitation Memorandum and the Supplement by the Parent and any other documents or materials relating to the Exchange Offer is not being made, and such documents and/or materials have not been approved, by an authorized person for the purposes of section 21 of the Financial Services and Markets Act 2000 (the FSMA ). Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials is exempt from the restriction on financial promotions under section 21 of the FSMA on the basis that it is only directed at and may be communicated to (1) those persons who are existing members or creditors of the Parent or other persons within Article 43 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, and (2) to any other persons to whom these documents and/or materials may lawfully be communicated. The Grand Duchy of Luxembourg Neither this announcement, the Exchange Offer and Consent Solicitation Memorandum nor the Supplement have been approved by and will not be submitted for approval to the Luxembourg Financial Services Authority (Commission de Surveillance du Secteur Financier) (the CSSF ) for purposes of public offering or sale in the Grand Duchy of Luxembourg. Accordingly, the Exchange Notes may not be offered to the public in the Grand Duchy of Luxembourg, directly or indirectly, and neither the Exchange Offer and Consent Solicitation Memorandum, the Supplement, nor any other offering circular, prospectus, form of application, advertisement or other material related to the Exchange Offer may be distributed, or otherwise be made available in or from, or published in, the Grand Duchy of Luxembourg except if a prospectus has been duly approved by the CSSF in accordance with the law of 10 July 2005, on prospectuses for securities, as amended (the Prospectus Law ) or the offer benefits from an exemption to or constitutes a transaction otherwise not subject to the requirement to publish a prospectus for the purpose of the Prospectus Law. 9

10 Norway The Exchange Offer and Consent Solicitation Memorandum and the Supplement have not been and will not be registered with the Financial Supervisory Authority of Norway. Accordingly, the Exchange Offer and Consent Solicitation Memorandum and the Supplement may not be made available, nor may Exchange Notes otherwise be marketed, in Norway other than in circumstances that are exempted from the prospectus requirements under the Norwegian Securities Trading Act (2007) chapter 7. France The Exchange Offer is not being made, directly or indirectly, to the public in the Republic of France ( France ). Neither the Exchange Offer and Consent Solicitation Memorandum, the Supplement nor any other documents or offering materials relating to the Exchange Offer have been or shall be distributed to the public in France and only (a) providers of investment services relating to portfolio management for the account of third parties (personnes fournissant le service d investissement de gestion de portefeuille pour compte de tiers), as defined in, and in accordance with, Articles L II-1 and D of the French Code monétaire et financier and/or (b) qualified investors (investisseurs qualifiés) acting for their own account, other than individuals, as defined in, and in accordance with, Articles L II-2, D D.744-1, D and D of the French Code monétaire et financier are eligible to participate in the Exchange Offer. Neither this announcement, the Supplement nor the Exchange Offer and Consent Solicitation Memorandum have been and will be submitted for clearance to nor approved by the Autorité des marchés financiers ( AMF ). Pursuant to Article of the General Regulation of the AMF, Holders and any Direct Participant are informed that the Exchange Notes cannot be distributed (directly or indirectly) to the public in France otherwise than in accordance with Articles L.411-1, L.411-2, L and L to L of the French Code monétaire et financier. Australia No prospectus or other disclosure document (as defined in the Corporations Act 2001 of Australia (the Australian Corporations Act )) in relation to the Exchange Notes has been or will be lodged with the Australian Securities and Investments Commission ( ASIC ). Exchange Notes may not (directly or indirectly) be offered for issue, nor may applications for the issue or subscription of the Exchange Notes be invited, in, to or from Australia (including an offer or invitation which is received by a person in Australia) and no offering memorandum, advertisement or other offering material relating to the Exchange Notes may be distributed or published in Australia unless (i) the aggregate consideration payable by each offeree or invitee is at least AUD 500,000 (or its equivalent in other currencies, disregarding moneys lent by the offeror or its associates) or the offer or invitation otherwise does not require disclosure to investors in accordance with Parts 6D.2 or 7.9 of the Australian Corporations Act, (ii) the offer or invitation does not constitute an offer to a retail client as defined under and for the purposes of Section 761G of the Australian Corporations Act, (iii) such action complies with all applicable laws, regulations and directives and (iv) such action does not require any document to be lodged with ASIC. Credit ratings in respect of the Exchange Notes and the Parent are for distribution to persons who are not a retail client within the meaning of section 761G of the Australian Corporations Act and are also sophisticated investors, professional investors or other investors in respect of whom disclosure is not required under Part 6D.2 or 7.9 of the Australian Corporations Act and in all cases in such circumstances as may be permitted by applicable laws in any jurisdiction in which an investor may be located. Anyone who is not such a person is not entitled to receive the Exchange Offer and Consent Solicitation Memorandum or the Supplement and anyone who receives the Exchange Offer and Consent Solicitation Memorandum or the Supplement must not distribute it to any person who is not entitled to receive it. Switzerland Neither this announcement, the Supplement nor the Exchange Offer and Consent Solicitation Memorandum constitute a public offering prospectus as that term is understood pursuant to Article 652a of the Swiss Code of Obligations. We have not applied for a listing of the Exchange Notes on the SWX Swiss Exchange and consequently the information presented in the Exchange Offer and Consent Solicitation Memorandum and the Supplement does not necessarily comply with the information standards set out in the relevant listing rules. The Exchange Notes may not be publicly offered in Switzerland. The Exchange Notes may be offered only to a selected number of individual investors in Switzerland, under circumstances which will not result in the Exchange Notes being a public offering within the meaning of Article 652a of the Swiss Code of Obligations. Each copy of the Exchange Offer and Consent Solicitation memorandum and the Supplement is addressed to a specifically named recipient and shall not be passed to a third party. General Neither this announcement, the Supplement nor the Exchange Offer and Consent Solicitation Memorandum constitute an offer to sell or buy or the solicitation of an offer to sell or buy the 2017 Notes and/or Exchange Notes, as applicable, (and offers of 2017 Notes for exchange pursuant to the Exchange Offer will not be accepted from Holders) in any circumstances in which such offer or solicitation is unlawful. Each Holder participating in the Exchange Offer or a Consent Solicitation will be deemed to give certain representations in respect of the jurisdictions referred to above and generally as set forth in Procedures for Participating in the Exchange Offers and the Consent Solicitations in the Exchange Offer and Consent Solicitation Memorandum. Any offer of 2017 Notes for exchange pursuant to the Exchange Offer from a Holder that is unable to make these representations will not be accepted. Each of the Parent and the Exchange and Tabulation Agent reserves the right, in its absolute discretion, to investigate, in relation to the offer of 2017 Notes for exchange pursuant to the Exchange Offer, whether any such representation given by a Holder is correct and, if such investigation is undertaken and as a result the Parent determines (for any reason) that such representation is not correct, such offer shall not be accepted. 10