Arclin Comments on Approvals From U.S. and Canadian Courts
Customer Supply to Continue Uninterrupted
Obtains Interim Approval of US$15 Million of Financing
Company Authorized to Continue Payment of Employee Wages, Salaries and Benefits

MISSISSAUGA, Ontario – July 29, 2009 – Arclin, a privately held provider of bonding and surfacing solutions, today announced that its U.S. companies, which filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code, received approval from the United States Bankruptcy Court for the District of Delaware on all “first day” motions.  As previously announced, Arclin’s Canadian companies made a filing with the Ontario Superior Court of Justice and have obtained an Initial Order authorizing Arclin to reorganize under the Companies’ Creditors Arrangement Act (“CCAA”), which provides certain protections from creditors and restructuring powers.  The approvals by the U.S. and Canadian courts allow Arclin to continue to support its customers, suppliers and employees during the restructuring process. 

The Courts granted Arclin interim approval to access $15 million of its US$25 million in financing.  This new financing and cash generated from the Company’s ongoing operations will be used to support the business during the restructuring process. 

The Company also received approval to, among other things, pay employee wages, salaries, benefits and certain other employee obligations.  Additionally, the Company is authorized to pay ordinary course post-petition expenses and will continue to serve its customers in the ordinary course.

Claudio D’Ambrosio, Arclin’s President and Chief Executive Officer, said, “These important approvals represent a positive step forward in our financial restructuring.  We are pleased with our early progress as we work to gain financial flexibility to create a stronger, healthier company, better able to compete and achieve long-term success.”

As previously announced, Arclin and certain of its key senior lenders have reached an agreement in principle on the terms of a financial restructuring to strengthen the Company’s balance sheet and enhance its financial flexibility.  Under terms of the agreement, Arclin’s funded indebtedness will be reduced from US$234 million to US$60 million.  A post-petition financing facility of US$25 million is also part of the financial restructuring.  In order to facilitate its financial restructuring, Arclin’s U.S. companies filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code and Arclin’s Canadian companies filed to reorganize under the CCAA.  Arclin’s subsidiaries in Mexico are not included in the filings and will not be subject to the requirements of the United States Bankruptcy Code or the CCAA.

Additional information about Arclin’s financial restructuring is available via the Company’s toll-free Restructuring Information Hotline at (866) 967-1787 in the U.S. or at (888) 802-3216 in Canada.  In addition, Court documents and other updates are available at websites that have been set up by Arclin’s Court appointed Monitor in Canada and by the Company’s Claims Agent in the U.S. (www.ey.com/ca/arclin and www.kccllc.net/arclin)

About Arclin
Based in Mississauga, Ontario, Arclin is a leading provider of innovative bonding and surfacing solutions for the building and construction, engineered materials and natural resource markets. Arclin provides bonding solutions for a number of applications including wood based panels, engineered wood, non-wovens and paper impregnation. As a world leader in paper overlays technology, Arclin provides high value surfacing solutions for decorative panels, building products and industrial specialty applications for North American and export markets.

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