##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 20-F







|☐ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------------

OR



|☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended December 31, 2016

OR



|☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

OR



|☐ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------

Date of event requiring this shell company report

For
the transition period from  to

Commission file number: 1-10928





INTERTAPE POLYMER GROUP INC.

(Exact name of Registrant as specified in its charter)





Canada

(Jurisdiction of incorporation or organization)

9999 Cavendish Blvd., Suite 200, Ville St. Laurent, Quebec, Canada H4M 2X5

(Address of principal executive offices)

Jeffrey Crystal, (941) 739-7522, jcrystal@itape.com, 100 Paramount Drive, Suite 300, Sarasota,
Florida 34232

(Name, Telephone, E-mail, and Address of Company Contact Person)



Securities registered or to be registered pursuant to Section
12(b) of the Act:



|                                            |  |                                          
|------------------------------------------- |  | -----------------------------------------
|Title of each class                         |  | Name of each exchange on which
registered
|Common Shares, without nominal or par value |  | Toronto Stock Exchange                   

Securities registered or to be registered pursuant to Section 12(g) of the Act:

Not applicable

(Title of
Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

Not applicable

(Title of
Class)





Indicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of the period
covered by the annual report. As of December 31, 2016, there were59,060,335 common shares outstanding.

Indicate by check
mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    ☒  Yes    ☐  No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934.    ☐  Yes☒  No

Note  Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.    ☒  Yes    ☐  No

Indicate by
check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).    ☐  Yes    ☐  No

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule
12b-2 of the Exchange Act. (Check one):

Large accelerated filer  ☒               
  Accelerated filer  ☐                 Non-accelerated filer  ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:



|           |  |                                                                                                          |  |         
|---------- |  | -------------------------------------------------------------------------------------------------------- |  | --------
|US GAAP  ☐ |  | International Financial Reporting Standards as issued
by the International Accounting Standards Board  ☒ |  | Other  ☐

If Other has been checked in response to the previous question, indicate by check mark which
financial statement item the registrant has elected to follow.    ☐  Item 17    ☐  Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    ☐  Yes☒  No

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the
Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.    ☐  Yes    ☐  No









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TABLE OF CONTENTS



|        |  |                                                                                   |  |      |    | 
|------- |  | --------------------------------------------------------------------------------- |  | ---- | -- | 
|        |  |                                                                                   |  | Page |   
|PART I  |  |                                                                                   |  |      | 5  | 
|        |  |                                                                                  
|ITEM 1: |  | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS                             |  |      | 5  | 
|        |  |                                                                                  
|ITEM 2: |  | OFFER STATISTICS AND EXPECTED TIMETABLE                                           |  |      | 5  | 
|        |  |                                                                                  
|ITEM 3: |  | KEY INFORMATION                                                                   |  |      | 5  | 
|        |  |                                                                                  
|A.      |  | SELECTED FINANCIAL DATA                                                           |  |      | 5  | 
|        |  |                                                                                  
|B.      |  | CAPITALIZATION AND INDEBTEDNESS                                                   |  |      | 6  | 
|        |  |                                                                                  
|C.      |  | REASONS FOR THE OFFER AND USE OF PROCEEDS                                         |  |      | 6  | 
|        |  |                                                                                  
|D.      |  | RISK FACTORS                                                                      |  |      | 7  | 
|        |  |                                                                                  
|ITEM 4: |  | INFORMATION ON THE COMPANY                                                        |  |      | 16 | 
|        |  |                                                                                  
|A.      |  | HISTORY AND DEVELOPMENT OF THE COMPANY                                            |  |      | 16 | 
|        |  |                                                                                  
|B.      |  | BUSINESS OVERVIEW                                                                 |  |      | 17 | 
|        |  |                                                                                  
|(1)     |  | Products, Markets and Distribution                                                |  |      | 21 | 
|(2)     |  | Sales and Marketing                                                               |  |      | 27 | 
|(3)     |  | Seasonality of the Companys Main Business                                        |  |      | 27 | 
|(4)     |  | Equipment and Raw Materials                                                       |  |      | 27 | 
|(5)     |  | Research and Development and New Products                                         |  |      | 28 | 
|(6)     |  | Trademarks and Patents                                                            |  |      | 28 | 
|(7)     |  | Competition                                                                       |  |      | 29 | 
|(8)     |  | Environmental Initiatives and Regulation                                          |  |      | 29 | 
|        |  |                                                                                  
|C.      |  | ORGANIZATIONAL STRUCTURE                                                          |  |      | 30 | 
|        |  |                                                                                  
|D.      |  | PROPERTY, PLANTS AND EQUIPMENT                                                    |  |      | 31 | 
|        |  |                                                                                  
|ITEM 5: |  | OPERATING AND FINANCIAL REVIEW AND PROSPECTS (MANAGEMENTS DISCUSSION & ANALYSIS) |  |      | 33 | 
|        |  |                                                                                  
|ITEM 6: |  | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES                                        |  |      | 68 | 
|        |  |                                                                                  
|A.      |  | DIRECTORS AND SENIOR MANAGEMENT                                                   |  |      | 68 | 
|        |  |                                                                                  
|B.      |  | COMPENSATION                                                                      |  |      | 72 | 
|        |  |                                                                                  
|C.      |  | BOARD PRACTICES                                                                   |  |      | 84 | 
|        |  |                                                                                  
|D.      |  | EMPLOYEES                                                                         |  |      | 85 | 
|        |  |                                                                                  
|E.      |  | SHARE OWNERSHIP                                                                   |  |      | 86 | 
|        |  |                                                                                  
|ITEM 7: |  | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS                                 |  |      | 87 | 
|        |  |                                                                                  
|A.      |  | MAJOR SHAREHOLDERS                                                                |  |      | 87 | 
|        |  |                                                                                  
|B.      |  | RELATED PARTY TRANSACTIONS                                                        |  |      | 88 | 
|        |  |                                                                                  
|C.      |  | INTERESTS OF EXPERTS AND COUNSEL                                                  |  |      | 88 | 
|        |  |                                                                                  
|ITEM 8: |  | FINANCIAL
INFORMATION                                                             |  |      | 88 | 
|        |  |                                                                                  
|A.      |  | CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION                           |  |      | 88 | 
|        |  |                                                                                  
|B.      |  | SIGNIFICANT CHANGES                                                               |  |      | 90 | 
|        |  |                                                                                  
|ITEM 9: |  | THE OFFER AND LISTING                                                             |  |      | 90 | 
|        |  |                                                                                  
|A.      |  | OFFER AND LISTING DETAILS                                                         |  |      | 90 | 
|        |  |                                                                                  
|B.      |  | PLAN OF DISTRIBUTION                                                              |  |      | 91 | 
|        |  |                                                                                  
|C.      |  | MARKETS                                                                           |  |      | 91 | 



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|          |  |                                                                              |     |  |     | 
|--------- |  | ---------------------------------------------------------------------------- | --- |  | --- | 
|D.        |  | SELLING SHAREHOLDERS                                                         |     |  | 91  | 
|          |  |                                                                             
|E.        |  | DILUTION                                                                     |     |  | 91  | 
|          |  |                                                                             
|F.        |  | EXPENSES OF THE ISSUE                                                        |     |  | 91  | 
|          |  |                                                                             
|ITEM 10:  |  | ADDITIONAL
INFORMATION                                                       |     |  | 91  | 
|          |  |                                                                             
|A.        |  | SHARE CAPITAL                                                                |     |  | 91  | 
|          |  |                                                                             
|B.        |  | MEMORANDUM AND ARTICLES OF ASSOCIATION                                       |     |  | 91  | 
|          |  |                                                                             
|C.        |  | MATERIAL CONTRACTS                                                           |     |  | 93  | 
|          |  |                                                                             
|D.        |  | EXCHANGE CONTROLS                                                            |     |  | 95  | 
|          |  |                                                                             
|F.        |  | DIVIDENDS AND PAYING AGENTS                                                  |     |  | 101 | 
|          |  |                                                                             
|G.        |  | STATEMENT BY EXPERTS                                                         |     |  | 101 | 
|          |  |                                                                             
|H.        |  | DOCUMENTS ON DISPLAY                                                         |     |  | 101 | 
|          |  |                                                                             
|I.        |  | SUBSIDIARY INFORMATION                                                       |     |  | 101 | 
|          |  |                                                                             
|ITEM 11:  |  | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                   |     |  | 101 | 
|          |  |                                                                             
|ITEM 12:  |  | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES                       |     |  | 101 | 
|          | 
|PART II   |  |                                                                              | 102 | 
|          |  |                                                                             
|ITEM 13:  |  | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES                              |     |  | 102 | 
|          |  |                                                                             
|ITEM 14:  |  | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS |     |  | 102 | 
|          |  |                                                                             
|ITEM 15:  |  | CONTROLS AND
PROCEDURES                                                      |     |  | 102 | 
|          |  |                                                                             
|ITEM 16:  |  | [RESERVED]                                                                   |     |  | 103 | 
|          |  |                                                                             
|ITEM 16A: |  | AUDIT COMMITTEE FINANCIAL EXPERT                                             |     |  | 103 | 
|          |  |                                                                             
|ITEM 16B: |  | CODE OF
ETHICS                                                               |     |  | 103 | 
|          |  |                                                                             
|ITEM 16C: |  | PRINCIPAL ACCOUNTANT FEES AND SERVICES                                       |     |  | 103 | 
|          |  |                                                                             
|ITEM 16D: |  | EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEE                    |     |  | 104 | 
|          |  |                                                                             
|ITEM 16E: |  | PURCHASE OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS        |     |  | 104 | 
|          |  |                                                                             
|ITEM 16F: |  | CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT                                 |     |  | 104 | 
|          |  |                                                                             
|ITEM 16G: |  | CORPORATE
GOVERNANCE                                                         |     |  | 105 | 
|          |  |                                                                             
|ITEM 16H: |  | MINE SAFETY
DISCLOSURE                                                       |     |  | 105 | 
|          | 
|PART III  |  |                                                                              | 105 | 
|          |  |                                                                             
|ITEM 17:  |  | FINANCIAL
STATEMENTS                                                         |     |  | 105 | 
|          |  |                                                                             
|ITEM 18:  |  | FINANCIAL
STATEMENTS                                                         |     |  | 105 | 
|          |  |                                                                             
|ITEM 19:  |  | EXHIBITS                                                                     |     |  | 105 | 
|          |  |                                                                             
|A.        |  | Consolidated Financial Statements                                            |     |  | 105 | 
|          |  |                                                                             
|B.        |  | Exhibits:                                                                    |     |  | 106 | 

Cautionary Note Regarding Forward-Looking Statements

Certain statements and information included in this annual report on Form 20-F constitute forward-looking
information within the meaning of applicable Canadian securities legislation and forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended, (collectively, forward-looking statements), which are made in reliance upon the protections provided by such legislation for forward-looking statements. All statements other than statements of historical
facts included in this annual report on Form 20-F, including statements regarding economic conditions, the Companys outlook, plans, prospects, products, financial position, future sales and financial
results,



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availability of credit, level of indebtedness, payment of dividends, fluctuations in raw material costs, competition, capital and other significant expenditures, potential acquisitions,
manufacturing facility closures and other restructurings, manufacturing plant rationalization initiatives, liquidity, litigation, and business strategies, may constitute forward-looking statements. These forward-looking statements are based on
current beliefs, assumptions, expectations, estimates, forecasts and projections made by the management of Intertape Polymer Group Inc. (Intertape, Intertape Polymer Group, IPG, or the Company). Words
such as may, will, should, expect, continue, intend, estimate, anticipate, plan, believe, future, likely,
or seek or the negatives of these terms or variations of them or similar terminology are intended to identify such forward-looking statements. Although the Company believes that the expectations reflected in these forward-looking
statements are reasonable, these statements, by their nature, involve risks and uncertainties and are not guarantees of future performance. Such statements are also subject to assumptions concerning, among other things: business conditions and
growth or declines in the Companys industry and the Companys customers industries; changes in general economic, political, social, fiscal or other conditions in any of the countries where the Company operates; the Companys
customers industries and the general economy; the anticipated benefits from the Companys manufacturing facility closures, manufacturing plant rationalization initiatives, greenfield developments, and other restructuring efforts; the
quality and market reception of the Companys products; the Companys anticipated business strategies; risks and costs inherent in litigation; risks and costs inherent in the Companys intellectual property; the Companys ability
to maintain and improve quality and customer service; the Companys ability to retain, and adequately develop and incentivize, its management team and key employees; anticipated trends in the Companys business; anticipated cash flows from
the Companys operations; availability of funds under the Companys Revolving Credit Facility; the Companys ability to continue to control costs; movements in the prices of key inputs such as raw material, energy and labor,
government policies, including those specifically regarding the manufacturing industry, such as industrial licensing, environmental regulations, labor and safety regulations, import restrictions and duties, intellectual property laws, excise duties,
sales taxes, and value added taxes; accidents and natural disasters; changes to accounting rules and standards; and other factors beyond our control. The Company can give no assurance that these statements and expectations will prove to have been
correct. Actual outcomes and results may, and often do, differ from what is expressed, implied or projected in such forward-looking statements, and such differences may be material. Readers are cautioned not to place undue reliance on any
forward-looking statement. For additional information regarding some important factors that could cause actual results to differ materially from those expressed in these forward-looking statements and other risks and uncertainties, and the
assumptions underlying the forward-looking statements, you are encouraged to read Item 3. Key Information - Risk Factors, Item 5. Operating and Financial Review and Prospects (Managements Discussion & Analysis)
as well as statements located elsewhere in this annual report on Form 20-F and the other statements and factors contained in the Companys filings with the Canadian securities regulators and the US
Securities and Exchange Commission. Each of the forward-looking statements speaks only as of the date of this annual report on Form 20-F. The Company will not update these statements unless applicable
securities laws require it to do so.



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PART I



|Item 1: | Identity of Directors, Senior Management and Advisers
|------- | -----------------------------------------------------

Not applicable.



|Item 2: | Offer Statistics and Expected Timetable
|------- | ---------------------------------------

Not applicable.



|Item 3: | Key Information
|------- | ---------------



| | A. | SELECTED FINANCIAL DATA
| | -- | -----------------------

The selected financial data presented below for the five years
ended December 31, 2016 is presented in US dollars and is derived from the Companys consolidated financial statements in US dollars and prepared in accordance with International Financial Reporting Standards (IFRS). The
information set forth below was extracted from the consolidated financial statements and related notes included in this annual report and annual reports previously filed and should be read in conjunction with such consolidated financial statements.
As required by the Canadian Accounting Standards Board, the Company adopted IFRS on January 1, 2011.



|                                                        |  |                                                                   |            |  |      |  |            |      |  |  |            |  |  |      |            |  |  |  |            | 
|------------------------------------------------------- |  | ----------------------------------------------------------------- | ---------- |  | ---- |  | ---------- | ---- |  |  | ---------- |  |  | ---- | ---------- |  |  |  | ---------- | 
|                                                        |  | As of and for the Year Ended December 31                          |           
|                                                        |  | 2016                                                              |            |  | 2015 |  |            | 2014 |  |  | 2013       |  |  | 2012 |           
|                                                        |  | (in thousands of US dollars, except shares and per share amounts) |           
|Statements of Consolidated Earnings:                    |  |                                                                   |            |  |      |  |            |      |  |  |            |  |  |      |            |  |  |  |            | 
|                                                        |  | $                                                                 |            |  | $    |  |            | $    |  |  | $          |  |  | $    |           
|Revenue                                                 |  |                                                                   | 808,801    |  |      |  | 781,907    |      |  |  | 812,732    |  |  |      | 781,500    |  |  |  | 784,430    | 
|                                                        |  |                                                                   |            |  |     
|Earnings before Income Taxes                            |  |                                                                   | 70,706     |  |      |  | 67,655     |      |  |  | 58,719     |  |  |      | 31,553     |  |  |  | 20,594     | 
|Net Earnings                                            |  |                                                                   | 51,137     |  |      |  | 56,672     |      |  |  | 35,816     |  |  |      | 67,357     |  |  |  | 20,381     | 
|Net Earnings attributable to Company shareholders       |  |                                                                   | 51,120     |  |      |  | 56,672     |      |  |  | 35,816     |  |  |      | 67,357     |  |  |  | 20,381     | 
|Earnings per share attributable to Company shareholders |  |                                                                   |            |  |      |  |            |      |  |  |            |  |  |      |            |  |  |  |            | 
|Basic                                                   |  |                                                                   | 0.87       |  |      |  | 0.95       |      |  |  | 0.59       |  |  |      | 1.12       |  |  |  | 0.35       | 
|Diluted                                                 |  |                                                                   | 0.85       |  |      |  | 0.93       |      |  |  | 0.57       |  |  |      | 1.09       |  |  |  | 0.34       | 
|                                                        |  |                                                                   |            |  |     
|Balance Sheets:                                         |  |                                                                   |            |  |      |  |            |      |  |  |            |  |  |      |            |  |  |  |            | 
|Total Assets                                            |  |                                                                   | 580,597    |  |      |  | 487,262    |      |  |  | 466,676    |  |  |      | 465,199    |  |  |  | 426,152    | 
|Capital Stock                                           |  |                                                                   | 351,203    |  |      |  | 347,325    |      |  |  | 357,840    |  |  |      | 359,201    |  |  |  | 351,702    | 
|Total Equity                                            |  |                                                                   | 242,943    |  |      |  | 216,728    |      |  |  | 227,500    |  |  |      | 230,428    |  |  |  | 153,834    | 
|Total Equity attributable to Company shareholders       |  |                                                                   | 236,536    |  |      |  | 216,728    |      |  |  | 227,500    |  |  |      | 230.428    |  |  |  | 153,834    | 
|Number of Common Shares Outstanding                     |  |                                                                   | 59,060,335 |  |      |  | 58.667,535 |      |  |  | 60,435,826 |  |  |      | 60,776,649 |  |  |  | 59,625,039 | 
|Dividends Declared per Share                            |  |                                                                   | 0.54       |  |      |  | 0.50       |      |  |  | 0.40       |  |  |      | 0.24       |  |  |  | 0.08       | 



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Exchange Rate Information

As of March 27, 2017, the exchange rate for one Canadian dollar expressed in terms of U.S. dollars, as quoted by Morning Star Foreign Exchange
Fast Lite on or about noon Eastern Standard Time, equaled 0.7475.

The following exchange rates tables are based upon the last traded
price on or about noon Eastern Standard Time from Morning Star Foreign Exchange Fast Lite.

The following table sets forth the high and
low exchange rates for one Canadian dollar expressed in terms of U.S. dollars for each month during the previous six months.



|                                    |  |        |  |       
|----------------------------------- |  | ------ |  | ------
|                                    |  | Low    |  | High  
|September 2016                      |  | 0.7549 |  | 0.7787
|October 2016                        |  | 0.7465 |  | 0.7640
|November 2016                       |  | 0.7360 |  | 0.7500
|December 2016                       |  | 0.7375 |  | 0.7621
|January 2017                        |  | 0.7438 |  | 0.7662
|February 2017                       |  | 0.7582 |  | 0.7694
|March 2017 (through March 27, 2017) |  | 0.7401 |  | 0.7551

The following table sets forth the average exchange rate for one Canadian dollar expressed in terms of U.S.
dollars for the fiscal years 2012, 2013, 2014, 2015 and 2016. The average rate is calculated using the average of the exchange rates on the last day of each month during the period.



|     |  |        
|---- |  | -------
|     |  | Average
|2012 |  | 1.001  
|2013 |  | 0.9720 
|2014 |  | 0.9060 
|2015 |  | 0.7824 
|2016 |  | 0.7544 



| | B. | CAPITALIZATION AND INDEBTEDNESS
| | -- | -------------------------------

Not applicable.



| | C. | REASONS FOR THE OFFER AND USE OF PROCEEDS
| | -- | -----------------------------------------

Not applicable.



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| | D. | RISK FACTORS
| | -- | ------------

Current economic conditions and uncertain economic forecast could
adversely affect the Companys results of operations and financial conditions.

Unfavorable changes in the global economy
have affected and may affect the demand for the products of the Company and its customers. Adverse economic conditions could also increase the likelihood of customer delinquencies. A prolonged period of economic decline would have a material adverse
effect on the results of operations, gross margins, and the overall financial condition of the Company, as well as exacerbate the other risk factors set forth below.

Fluctuations in raw material costs or the unavailability of raw materials may adversely affect the Companys profitability.

Historically, the Company has not always been able to pass on significant raw material cost increases through price increases to its
customers. The Companys results of operations in prior years, at times, have been negatively impacted by raw material cost increases. These increases adversely affected the Companys profitability. As a result of raw material cost
increases, the Company may increase prices (which could result in reduced market share) or may choose to keep prices the same (which could result in decreased margins). The Companys profitability in the future may be adversely affected
due to fluctuations in raw material prices. Additionally, the Company relies on its suppliers for deliveries of raw materials. If any of its suppliers are unable to deliver raw materials to the Company for an extended period of time, there is no
assurance that the Companys raw material requirements would be met by other suppliers on acceptable terms, or at all (although the Company has alternative suppliers for a number of the raw materials it uses), which could have a material
adverse effect on the Companys results of operations.

Given that a significant portion of the Companys major raw materials
are by-products of crude oil and natural gas, the Company is subject to risks associated with energy markets. These markets are subject to volatility, which may result in increased raw material costs for the
Company. A number of potential factors, such as legislation aimed at reducing greenhouse gas emissions, wars, terrorist attacks, heightened tariffs and other adverse international trade issues, and political unrest, may result in volatile energy
markets and increased raw material costs for the Company.

The Companys ability to achieve its growth objectives depends in
part on the timing and market acceptance of its new products and its improved products, as well as its strategic acquisitions and capital expenditure initiatives proving to have the positive effects contemplated in the Companys growth
objectives.

The Companys business plan includes the introduction of new products and the improvement of existing products,
which are both developed internally and obtained through acquisitions. The Companys ability to introduce these products successfully depends on the demand for the products, as well as their price, quality, and related customer service. In the
event the market does not fully accept these products, or competitors introduce similar or superior products (or products perceived by the market to be similar or superior), the Companys ability to expand its markets and generate organic
growth could be negatively impacted which could have an adverse effect on its operating results.

In addition, the Companys business
plan and growth objectives contain certain goals based on potential acquisitions and capital expenditures. The Company cannot provide any assurances that it will be able to: identify future strategic acquisitions and adequately conduct due
diligence; consummate these potential acquisitions on favorable terms, if at all; or if consummated, successfully integrate the operations and management of future acquisitions. Similarly, for potential capital expenditure projects (including any
greenfield developments): we may be unable to identify positive projects; actual costs may exceed expected costs for such projects; we may be unable to complete such projects in a timely manner, if at all; such projects may require substantial
capital that we are unable to obtain on favorable terms, if at all; such projects may require numerous governmental permits and approvals, and we may be unable to obtain such permits and approvals in a timely manner and at a reasonable cost, if at
all; such projects may not yield the expected benefits; and the Companys Revolving Credit Facilitys covenants may limit our ability to develop such projects.

For a further description of the risks related to the Companys acquisitions, see Risk Factors  Acquisitions could expose the
Company to significant business risks. For a further description of the risks related to the Companys Revolving Credit Facility, see Risk Factors  The Companys Revolving Credit Facility contains covenants that limit its
flexibility and prevent the Company from taking certain actions.



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The Companys competition and customer preferences could impact the Companys
profitability.

The markets for the Companys products are highly competitive. Competition in its markets is primarily based
upon the quality, breadth and performance characteristics of its products, customer service and price. The Companys ability to compete successfully depends upon a variety of factors, including its ability to create new and improved products,
effectively employ skilled personnel, increase plant efficiencies, reduce manufacturing costs, and create complementary products for customer convenience of a single supplier, as well as its access to quality,
low-cost raw materials.

Some of the Companys competitors, particularly certain of those
located in Asia, may, at times, have lower costs (i.e. raw material, energy and labor) and/or less restrictive environmental and governmental regulations to comply with than the Company does. Other competitors may be larger in size or scope than the
Company, which may allow them to achieve greater economies of scale on a global basis or allow them to better withstand periods of declining prices and adverse operating conditions.

Demand for the Companys products and, in turn, its revenue and profit margins, are affected by customer preferences and changes in
customer ordering patterns which may occur as a result of changes in inventory levels and timing of purchases which may be triggered by price changes and incentive programs.

The Companys customer contracts contain termination provisions that could decrease the Companys future revenues and
earnings.

Most of the Companys customer contracts can be terminated by the customer on short notice without penalty. The
Companys customers are, therefore, not contractually obligated to continue to do business with it in the future. This creates uncertainty with respect to the revenues and earnings the Company may recognize with respect to its customer
contracts.

The Companys manufacturing plant rationalization initiatives, manufacturing cost reduction programs and capital
expenditure projects may result in higher costs and less savings than anticipated.

The Company has implemented several
manufacturing plant rationalization initiatives, manufacturing cost reduction programs and capital expenditure projects. Certain of these have not been, and others may not in the future be, completed as planned. As a result, the costs and capital
expenditures incurred by the Company have in certain instances substantially exceeded, and may in the future substantially exceed, projections. In addition, the timing for achieving cost reductions has sometimes been, and may in the future be, later
than expected. This could potentially, and has in certain instances, resulted in additional debt incurred by the Company, increased costs, reduced profits, or reduced production and elimination. In addition, the anticipated manufacturing cost
savings has been, and may be, less than expected or may not materialize at all.

Acquisitions could expose the Company to
significant business risks.

The Company may make strategic acquisitions that could, among other goals, complement its existing
products, expand its customer base, range of products, production capacity and markets, improve distribution efficiencies, lower production costs and enhance its technological capabilities. Financial risks from these acquisitions include:
(a) the use of the Companys cash resources; (b) paying a price that exceeds the future value realized from the acquisition; (c) an increase in our expenses and working capital requirements (which could reduce our return on
invested capital); (d) potential known and unknown liabilities of the acquired businesses, as well as contractually-based time and monetary limitations on a sellers obligation to indemnify us for such liabilities; (e) the incurrence of
additional debt; (f) the dilutive effect of the issuance of any additional equity securities we issue as consideration for, or to finance, the acquisition; (g) the financial impact of incorrectly valuing goodwill and other intangible
assets involved in any acquisitions; (h) potential future impairment write-downs of goodwill and indefinite life intangibles and the amortization of other intangible assets; (i) possible adverse tax and accounting effects; and (j) the
risk that we spend substantial amounts purchasing these manufacturing facilities and assume significant contractual and other obligations with no guaranteed levels of revenue or that we may have to close or sell acquired facilities at our cost,
which may include substantial employee severance costs and asset write-offs.

Further, there are possible operational risks including:
difficulty assimilating and integrating the operations; products; technology; information systems and personnel of acquired companies; losing key personnel of acquired entities; entry into markets in which the Company has no or limited prior
experience; diversion of managements attention; compliance with a different jurisdictions laws; failure to obtain or retain intellectual property rights for certain products; and difficulty honoring commitments made to customers of the
acquired companies prior to the acquisition. The Company may incur significant acquisition, administrative



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and other costs in connection with these transactions, including costs related to the integration of acquired businesses. These acquisitions could expose the Company to significant integration
risks and increased organizational complexity, including more complex and costly accounting processes and internal controls, which may challenge management and may adversely impact the realization of an increased contribution from said acquisitions.
The failure to adequately address these risks could adversely affect the Companys business and financial performance.

Although the
Company performs due diligence investigations of the businesses and assets that it acquires, and anticipates continuing to do so for future acquisitions, there may be liabilities related to the acquired business or assets that the Company fails to,
or is unable to, uncover during its due diligence investigation and for which the Company, as a successor owner, may be responsible. When feasible, the Company seeks to minimize the impact of these types of potential liabilities by obtaining
indemnities and warranties from the seller, which may in some instances be supported by deferring payment of a portion of the purchase price. However, these indemnities and warranties, if obtained, may not fully cover the liabilities because of
their limited scope, amount or duration, the financial resources of the indemnitor or warrantor, or other reasons.

Some of our recent
acquisitions involve, and potential future acquisitions may involve, operations outside of the U.S. which are subject to various risks including those described in Risk Factors  The Company faces risks related to its international
operations.

The Companys Revolving Credit Facility contains covenants that limit its flexibility and prevent the
Company from taking certain actions.

The loan and security agreement governing the Companys Revolving Credit Facility
includes a number of significant restrictive covenants. These covenants could limit the Companys ability to plan for or react to market conditions, meet its capital needs and execute its business strategy. These covenants, among other things,
limit the Companys ability and the ability of its subsidiaries to incur additional debt; prepay other debt; pay dividends and make other restricted payments; create or permit certain liens; issue or sell capital stock of restricted
subsidiaries; use the proceeds from sales of assets; make certain investments; create or permit restrictions on the ability of the guarantors to pay dividends or to make other distributions to the Company; enter into certain types of transactions
with affiliates; engage in unrelated businesses; enter into sale and leaseback transactions; and consolidate or merge or sell the Companys assets substantially as an entirety.

A number of these restrictions are more stringent in regards to subsidiaries of the Company that are not party to the Companys Revolving
Credit Facility (collectively, the Non-Credit Parties). The Non-Credit Parties are limited in their ability to incur debt outside of the Companys
Revolving Credit Facility. In addition, the Company and its subsidiaries are limited in the amount of investments that they may make in the Non-Credit Parties and the amount of guaranties they may make in
connection with debt incurred by the Non-Credit Parties outside of the Companys Revolving Credit Facility.

The Company depends on its subsidiaries for cash to meet its obligations and pay any dividends.

The Company is a holding company. Its subsidiaries conduct all of its operations and own substantially all of its assets. Consequently, the
Companys cash flow and its ability to meet its obligations or pay dividends to its stockholders depend upon the cash flow of its subsidiaries and the payment of funds by its subsidiaries to the Company in the form of dividends, tax sharing
payments or otherwise. The Companys subsidiaries ability to provide funding will depend on, amongst others, their earnings, the terms of indebtedness from time to time, tax considerations and legal restrictions.

Payment of dividends may not continue in the future, and the payment of dividends is subject to restriction.

On August 10, 2016, the Board of Directors amended the Companys dividend policy by increasing the annualized dividend by 7.7% from
$0.52 to $0.56 per share. The future declaration and payment of dividends, if any, will be at the discretion of the Board of Directors and will depend on a number of factors, including the Companys financial and operating results, financial
position, legal requirements, and anticipated cash requirements. The Company can give no assurance that dividends will be declared and paid in the future or, if declared and paid in the future, at the same level as in the past. Additionally, the
Companys Revolving Credit Facility restricts its ability to pay dividends if the Company does not maintain certain borrowing availability or if the Company is in default.

The Companys outstanding debt could adversely affect its financial condition.

As of December 31, 2016, the Company had outstanding debt of $179.8 million, which represented 14.0% of its total capitalization. Of
such total debt, approximately $179.8 million, or all of the Companys outstanding senior debt, was secured.



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The Companys outstanding indebtedness could adversely affect its financial condition. The
Companys outstanding indebtedness could also increase its vulnerability to adverse general economic and industry conditions; require the Company to dedicate a substantial portion of its cash flows from operating activities to payments on its
indebtedness, thereby reducing the availability of the Companys cash flows to fund working capital, capital expenditures, potential acquisitions, research and development efforts and other general corporate purposes; limit the Companys
flexibility in planning for, or reacting to, changes in its business and the industry in which it operates; place the Company at a competitive disadvantage compared to its competitors that have less debt; and limit the Companys ability to
borrow additional funds on terms that are satisfactory to it or at all.

The Company may not be able to generate sufficient cash
flow to meet its debt service obligations.

The Companys ability to generate sufficient cash flows from operating activities
to make scheduled payments on its debt obligations will depend on its future financial performance, which will be affected by a range of economic, competitive, regulatory, legislative and business factors, many of which are outside of the
Companys control. If the Company does not generate sufficient cash flows from operating activities to satisfy its debt obligations, the Company may have to undertake alternative financing plans, such as refinancing or restructuring its debt,
selling assets, reducing or delaying capital investments or seeking to raise additional capital. The Company cannot assure that any refinancing would be possible or that any assets could be sold on acceptable terms or otherwise. The Companys
inability to generate sufficient cash flows to satisfy its debt obligations, or to refinance its obligations on commercially reasonable terms, would have a material adverse effect on the Companys business, financial condition and results of
operations. In addition, any refinancing of the Companys debt could be at higher interest rates and may require the Company to comply with more onerous covenants, which could further restrict its business operations. Also, any additional
issuances of equity would dilute the Companys shareholders.

Despite the Companys level of indebtedness, it will likely
be able to incur substantially more debt. Incurring such debt could further exacerbate the risks to the Companys financial condition described above.

The Company will likely be able to incur substantial additional indebtedness in the future. Although the loan and security agreement governing
the Revolving Credit Facility contains restrictions on the incurrence of additional indebtedness, these restrictions are subject to qualifications and exceptions and the indebtedness incurred in compliance with these restrictions could be
substantial. The restrictions also do not prevent the Company from incurring obligations that do not constitute indebtedness. To the extent new debt is added to the Companys currently anticipated debt levels, the substantial leverage risks
described above would increase.

The failure to maintain effective internal control over financial reporting in accordance with
applicable securities laws could cause the Companys stock price to decline.

Section 404 of the Sarbanes-Oxley Act of
2002 and the related rules and regulations of the US Securities and Exchange Commission (the SEC) as well as applicable rules and guidelines adopted by the Canadian Securities Administrators require annual management assessments of the
effectiveness of the Companys internal control over financial reporting and a report by the Companys independent registered public accounting firm to express an opinion on these controls based on their audit. Due to inherent limitations,
there can be no assurance that the Companys system of internal control over financial reporting will be successful in preventing all errors, theft, and fraud, or in informing management of all material information in a timely manner. These
risks will likely be exacerbated as the Company expands, particularly in foreign jurisdictions where employees may not be as accustomed to such laws and regulations. Also, if the Company cannot in the future favorably assess, or the Companys
independent registered public accounting firm is unable to provide an unqualified attestation report on the effectiveness of the Companys internal control over financial reporting, investors may lose confidence in the reliability of the
Companys financial reports, which could cause the Companys stock price to decline.

Certain of the Companys
pension and other post-retirement benefit plans are partially funded or unfunded which could require Company contributions.

The
Companys pension and other post-retirement benefit plans currently have an unfunded deficit of $30.8 millionas of December 31, 2016 as compared to $29.3 million at the end of 2015. For 2016 and 2015, the Company
contributed $1.4 million and $2.0 million, respectively, to its wholly or partiallyfunded pension plans and to beneficiaries for its unfunded other benefit plans. The Company may need to divert certain of its resources in the
future in order to resolve this funding deficit. In addition, the Company cannot predict whether a change in factors such as pension asset performance or interest rates, will require the Company to make a contribution in excess of its current
expectations. Also, the Company expects to contribute $4.1 million to satisfy its 2017 minimum funding requirement for its wholly or partially funded pension plans and to beneficiaries for its unfunded other benefit plans. Further, the Company
may not have the funds necessary to meet future minimum pension funding requirements or be able to meet its pension benefit plan funding obligation through cash flows from operating activities.



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The Company depends on the proper functioning of its information systems.

The Company is dependent on the proper functioning of information systems, some of which are owned and operated by third parties, to store,
process and transmit confidential information, including financial reporting, inventory management, procurement, invoicing and electronic communications belonging to its customers, its suppliers, its employees and/or the Company itself. The
Companys information systems are vulnerable to natural disasters, fire, casualty theft, technical failures, terrorist acts, cyber security breaches, power loss, telecommunications failures, physical or software intrusions, computer viruses,
and similar events. If the Companys critical information systems fail or are otherwise unavailable, its operations could be disrupted, causing a material adverse effect on its business. Also, any theft or misuse of information resulting from a
security breach could result in, among other things, loss of significant and/or sensitive information, litigation by affected parties, financial obligations resulting from such theft or misuse, higher insurance premiums, governmental investigations,
negative reactions from current and potential future customers (including potential negative financial ramifications under certain customer contract provisions) and poor publicity. Given the seemingly increasing frequency and severity of
cyberattacks on commercial and governmental organizations in recent years, this threat may be heightened for the Company. Any of these consequences, in addition to the time and funds spent on monitoring and mitigating the Companys exposure and
responding to breaches, including the training of employees, the purchase of protective technologies and the hiring of additional employees and consultants to assist in these efforts, could adversely affect its financial results.

The Company faces risks related to its international operations.

The Company has customers and operations located outside the United States and Canada. In 2016, sales to customers located outside the United
States and Canada represented approximately 10% of its sales. The Companys international operations present it with a number of risks and challenges, including potential difficulties staffing and managing its foreign operations, potential
difficulties managing a more extensive supply chain as compared to its sales efforts in the United States and Canada, potential adverse changes in tax regulations affecting tax rates and the way the United States and other countries tax
multinational companies, the effective marketing of the Companys products in other countries, tariffs and other trade barriers, less favorable intellectual property laws, longer customer payment cycles, exposure to economies that may be
experiencing currency volatility or negative growth, exposure to political and economic instability and unsafe working conditions (including acts of terrorism, widespread criminal activities and outbreaks of war) and different regulatory schemes and
political environments applicable to its operations in these areas, such as environmental and health and safety compliance. As a result of the Companys recent acquisition of Powerband Industries Private Limited (d/b/a Powerband)
(Powerband), we expect that our business mix will rebalance to a greater percentage of international operations which should increase our exposure to these risks.

Due in large part to the new U.S. Presidential administration, many are expecting substantial changes to U.S. trade and tax policies,
including heightened import restrictions or tariffs. Restrictions could prevent or make it difficult for the Company to obtain certain raw materials and/or equipment needed to manufacture certain products. Increased tariffs could require the Company
to increase its prices which likely could decrease demand for the Companys products. In addition, other countries may retaliate through their own restrictions and or increased tariffs which would affect our ability to export products and
therefore adversely affect our sales.

The U.S. Federal Reserve recently increased its benchmark interest rate and signaled that rates
could continue to rise more quickly than previously expected. While it is unclear whether these actions suggest a change in previous monetary policy positions, including but not limited to an elimination of quantitative easing over time, any such
change or market expectation of such change may result in significantly higher long-term interest rates. Such a transition may be abrupt and may, among other things, reduce the availability and/or increase the costs of obtaining new debt and
refinancing existing indebtedness, negatively impact the market price of our common stock, and potentially decrease demand for the products of the Company and its customers.

In addition, in June 2016, voters in the United Kingdom approved an advisory referendum to withdraw membership from the European Union, which
proposed exit (commonly referred to as Brexit) could cause disruptions to, and create uncertainty surrounding, the Companys business in Europe, including affecting the Companys relationships with its existing and future
customers, suppliers and employees.



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Finally, the Companys financial statements are reported in US dollars while a portion of
its sales is made in other currencies, primarily the Canadian dollar, the Euro and the Indian Rupee. As a result, fluctuations in exchange rates between the US dollar and foreign currencies can have a negative impact on the Companys reported
operating results and financial condition. Moreover, in some cases, the currency of the Companys sales does not match the currency in which it incurs costs, which can negatively affect its profitability. Fluctuations in exchange rates can also
affect the relative competitive position of a particular facility where the facility faces competition from non-local producers, as well as the Companys ability to successfully market its products in
export markets.

The Companys operations are subject to comprehensive environmental regulation and involve expenditures which
may be material in relation to its operating cash flow.

The Companys operations are subject to extensive environmental
regulation in each of the countries in which it maintains facilities. For example, US (federal, state and local), Canadian (federal, provincial and local) and Indian (federal, state and local). environmental laws applicable to the Company include
statutes and regulations intended to impose certain obligations with respect to site contamination and to allocate the cost of investigating, monitoring and remedying soil and groundwater contamination among specifically identified parties, as well
as to prevent future soil and groundwater contamination; imposing ambient standards and, in some cases, emission standards, for air pollutants which present a risk to public health, welfare or the natural environment; governing the handling,
management, treatment, storage and disposal of hazardous wastes and substances; and regulating the discharge of pollutants into waterways.

The Companys use of hazardous substances in its manufacturing processes and the generation of hazardous wastes not only by the Company,
but by prior occupants of its facilities, suggest that hazardous substances may be present at or near certain of the Companys facilities or may come to be located there in the future. Consequently, the Company is required to closely monitor
its compliance under all the various environmental laws and regulations applicable to it. In addition, the Company arranges for the off-site disposal of hazardous substances generated in the ordinary course of
its business.

The Company obtains Phase I or similar environmental site assessments, and Phase II environmental site assessments, if
necessary, for most of the manufacturing facilities it owns or leases at the time it either acquires or leases such facilities. These assessments typically include general inspections and may involve soil sampling and/or groundwater analysis. The
assessments have not revealed any material or significant environmental liability, other than, or in addition to, the $2.5 million liability as of December 31, 2016,accrued in provisions in the Companys consolidated balance
sheet, that, based on current information, the Company believes will have a material adverse effect on it. Nevertheless, these assessments may not reveal all potential environmental liabilities and current assessments are not available for all
facilities. Consequently, there may be material environmental liabilities that the Company is not aware of. In addition, ongoing cleanup and containment operations may not be adequate for purposes of future laws and regulations. The conditions of
the Companys properties could also be affected in the future by neighboring operations or the conditions of the land in the vicinity of its properties. These developments and others, such as increasingly stringent environmental laws and
regulations, increasingly strict enforcement of environmental laws and regulations, or claims for damage to property or injury to persons resulting from the environmental, health or safety impact of its operations, may cause the Company to incur
significant costs and liabilities that could have a material adverse effect on it.

Except as described in Item 4B(8) below, the Company
believes that all of its facilities are in material compliance with applicable environmental laws and regulations and that it has obtained, and is in material compliance with, all material permits required under environmental laws and regulations.
Although certain of the Companys facilities emit pollutants into the air, these emissions are within current permitted limits.

The
Companys facilities are required to maintain numerous environmental permits and governmental approvals for its operations. Some of the environmental permits and governmental approvals that have been issued to the Company or to its facilities
contain conditions and restrictions, including restrictions or limits on emissions and discharges of pollutants and contaminants, or may have limited terms. If the Company fails to satisfy these conditions or to comply with these restrictions, it
may become subject to enforcement actions and the operation of the relevant facilities could be adversely affected. The Company may also be subject to fines, penalties or additional costs. The Company may not be able to renew, maintain or obtain all
environmental permits and governmental approvals required for the continued operation or further development of the facilities, as a result of which the operation of the facilities may be limited or suspended.



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The Company may become involved in litigation relating to its intellectual property rights,
which could have an adverse impact on its business.

The Company relies on patent protection, as well as a combination of
copyright, trade secret and trademark laws, nondisclosure and confidentiality agreements and other contractual restrictions to protect its proprietary technology. In addition to relying on patent protection, as well as a combination of copyright,
trade secret and trademark laws, nondisclosure and confidentiality agreements and other contractual restrictions, the Company relies a fair amount on unpatented proprietary know-how and trade secrets. The
Company employs various methods, including its internal security systems, policies and procedures, to protect its proprietary know-how and trade secrets. These mechanisms may not, however, afford complete or
sufficient protection, and misappropriation may still occur.

Litigation may be necessary to enforce these rights, which could result in
substantial costs to the Company and a substantial diversion of management attention. Further, there can be no assurance that the Company will be able to enforce its patent or other rights, if any, and that others will not independently develop
similar know-how and trade secrets, or develop better production methods. If the Company does not adequately protect its intellectual property, its competitors or other parties could use the intellectual
property that the Company has developed to enhance their products or make products similar to the Companys and compete more efficiently with it, which could result in a decrease in the Companys market share.

While the Company has attempted to ensure that its products and the operations of its business do not infringe other parties patents and
proprietary rights, its competitors or other parties may assert that the Companys products and operations may infringe upon patents held by them. In addition, because patent applications can take many years to issue, the Company might have
products that infringe upon pending patents and other proprietary rights of which it is unaware. If any of the Companys products infringe a valid patent, the Company could be prevented from selling such products unless the Company obtains a
license or redesigns the products to avoid infringement. A license may not be available or may require the Company to pay substantial royalties. The Company may not be successful in attempts to redesign its products to avoid infringement.
Infringement or other intellectual property claims, regardless of merit or ultimate outcome, can be expensive and time-consuming to resolve as well as divert managements attention from the Companys core business.

The Company may become involved in labor disputes or employees could form or join unions increasing the Companys costs to do
business.

Some of the Companys employees are subject to collective bargaining agreements. Other employees are not part of a
union and there are no assurances that such employees will not form or join a union. Any attempt by employees to form or join a union could result in increased labor costs and adversely affect the Companys business, its financial condition
and/or results of operations.

Except for the strike which occurred at the Companys Brantford, Ontario plant in 2008, which is now
closed, the Company has never experienced any work stoppages due to employee related disputes. Management believes that it has a good relationship with its employees. However, there can be no assurance that work stoppages or other labor disturbances
will not occur in the future. Such occurrences could adversely affect the Companys business, financial condition and/or results of operations.

The Company may become involved in litigation which could have an adverse impact on its business.

The Company, like other manufacturers and sellers, is subject to potential liabilities connected with its business operations, including
potential liabilities and expenses associated with product defects, performance, reliability or delivery delays. The Company is threatened from time to time with, or is named as a defendant in, legal proceedings, including lawsuits based upon
product liability, personal injury, breach of contract and lost profits or other consequential damages claims, in the ordinary course of conducting its business. A significant judgment against the Company, or the imposition of a significant fine or
penalty resulting from a finding that the Company failed to comply with laws or regulations, or being named as a defendant on multiple claims could adversely affect the Companys business, financial condition and/or results of operations.

Uninsured and underinsured losses and rising insurance costs could adversely affect the Companys business.

The Company maintains property, business interruption, general liability, directors and officers liability and other ancillary insurance
on such terms as it deems appropriate. This may result in insurance coverage that, in the event of a substantial loss, would not be sufficient to pay for the full current market value or current replacement cost of the Companys lost
investment. Not all risks are covered by insurance, as such coverage is not feasible.

The Companys cost of maintaining property,
general liability and business interruption insurance and director and officer liability insurance is significant. The Company could experience higher insurance premiums as a result of adverse claims experience or because of general increases in
premiums by insurance carriers for reasons unrelated to its own claims experience. Generally,



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the Companys insurance policies must be renewed annually. The Companys ability to continue to obtain insurance at affordable premiums also depends upon its ability to continue to
operate with an acceptable claims record. A significant increase in the number of claims against the Company, the assertion of one or more claims in excess of its policy limits, or the inability to obtain adequate insurance coverage at acceptable
rates, or any insurance coverage at all, could adversely affect the Companys business, financial condition and/or results of operations.

The Companys success depends upon retaining the services of its management team and key employees.

The Company is dependent on its management team and expects that continued success will depend largely upon their efforts and abilities. The
loss of the services of any key executive for any reason could have a material adverse effect on the Company. Success also depends upon the Companys ability to identify, develop, and retain qualified employees.

Product liability could adversely affect the Companys business.

Difficulties in product design, performance and reliability could result in lost sales, delays in customer acceptance of the Companys
products, customer complaints or lawsuits. Such difficulties could be detrimental to the Companys market reputation. The Companys products and the products supplied by third parties on behalf of the Company may not be error-free.
Undetected errors or performance problems may be discovered in the future. The Company may not be able to successfully complete the development of planned or future products in a timely manner or adequately address product defects, which could harm
the Companys business and prospects. In addition, product defects may expose the Company to product liability claims, for which it may not have sufficient product liability insurance. Difficulties in product design, performance and reliability
or product liability claims could adversely affect the Companys business, financial condition and/or results of operations.

Because the Company is a Canadian company, it may be difficult to enforce rights under US bankruptcy laws.

The Company and certain of its subsidiaries are incorporated under the laws of Canada and a substantial amount of its assets are located
outside of the United States. Under bankruptcy laws in the United States, courts typically assert jurisdiction over a debtors property, wherever located, including property situated in other countries. However, courts outside of the United
States may not recognize the United States bankruptcy courts jurisdiction over property located outside of the territorial limits of the United States. Accordingly, difficulties may arise in administering a United States bankruptcy case
involving a Canadian debtor with property located outside of the United States, and any orders or judgments of a bankruptcy court in the United States may not be enforceable outside the territorial limits of the United States.

It may be difficult for investors to enforce civil liabilities against the Company under US federal and state securities laws.

The Company and certain of its subsidiaries are incorporated under the laws of Canada. Certain of their directors are residents
of Canada and a portion of directors and executive officers assets may be located outside of the United States. In addition, certain subsidiaries are located in other foreign jurisdictions. As a result, it may be difficult or impossible
for US investors to effect service of process within the United States upon the Company, its Canadian subsidiaries, or its other foreign subsidiaries, or those directors and officers, or to enforceagainst them judgments of courts of the
United States predicated upon the civil liability provisions of US federal securities laws or securities or blue sky laws of any state within the United States. The Company believes that a judgment of a US court predicated solely upon the civil
liability provisions of the Securities Act of 1933, as amended and/or the Securities Exchange Act of 1934, as amended (Exchange Act) would likely be enforceable in Canada if the US court in which the judgment was obtained had a basis for
jurisdiction in the matter that was recognized by a Canadian court for such purposes. The Company cannot assure, however, that this will be the case. There is substantial doubt whether an action could be brought in Canada in the first instance on
the basis of liability predicated solely upon such laws.

The Company has its registered office in the Province of Québec, Canada
and, as a result, is subject to the securities laws of that province. In addition, the Company is a reporting issuer under the securities laws of each of the provinces of Canada and is therefore subject to the provisions thereof relating
to, among other things, continuous disclosure and filing of insider reports by the Companys reporting insiders, as applicable.



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While the Companys shares trade on the Toronto Stock Exchange, they trade on the OTC
Pink Marketplace in the US, which may result in the possible absence of a liquid trading market for securities of US investors.

The Companys common shares are traded in the US on the OTC Pink Marketplace. Trading on this market can be thin and characterized by
wide fluctuations in trading prices, due to many factors that may have little to do with a companys operations or business prospects. In addition, trading on this market is often sporadic, so shareholders may have some difficulty reselling any
of their shares of common stock on this market.

Compliance with the SECs conflict mineral disclosure requirements results in
additional compliance costs and may create reputational challenges.

The SEC adopted rules pursuant to Section 1502 of the
Dodd-Frank Act setting forth disclosure requirements concerning the use or potential use of certain minerals and their derivatives, including tantalum, tin, gold and tungsten, that are mined from the Democratic Republic of Congo and adjoining
countries, and deemed conflict minerals. These requirements have necessitated, and will continue to necessitate, due diligence efforts by the Company to assess whether such minerals are used in the Companys products in order to make the
relevant required disclosures. There are certain costs associated with complying with these new disclosure requirements, including diligence to determine the sources of those minerals that may be used or necessary to the production of the
Companys products. If the Company determines that certain of its products contain minerals that are not conflict-free or is unable to sufficiently verify the origins for all conflict minerals used in its products, the Company may face changes
to its supply chain or challenges to its reputation, either of which could impact future sales.

The Companys exemptions under
the Exchange Act of 1934, as a foreign private issuer, limit the protections and information afforded investors.

The Company is a
foreign private issuer within the meaning of the rules promulgated under the Exchange Act. As such, it is exempt from certain provisions applicable to United States companies with securities registered under the Exchange Act, including: the rules
under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K; the sections of the Exchange Act regulating
the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and
establishing insider liability for profits realized from any short-swing trading transaction (i.e., a purchase and sale, or sale and purchase, of the issuers equity securities within a period of less than six months).
Because of these exemptions, purchasers of the Companys securities are not afforded the same protections or information generally available to investors in public companies organized in the United States. For the year ended December 31,
2008 and commencing for the year ended December 31, 2010 and going forward, the Company has elected to file its annual report on Form 20-F which also fulfills the requirements of the Annual Information
Form required in Canada, thus necessitating only one report. The Company reports on Form 6-K, and makes certain other filings (such as Form S-8, Form 11-K and Form SD), with the United States Securities and Exchange Commission and publicly releases quarterly financial reports.

Our business could be negatively affected by the actions of activist shareholders.

Certain of our shareholders may from time to time advance shareholder proposals or otherwise attempt to effect changes or acquire control over
our business. Such proposals or attempts are sometimes led by investors seeking to increase short-term shareholder value by advocating corporate actions such as financial restructuring, increased borrowing, special dividends, stock repurchases or
even sales of assets or the entire company. Such an action focused on the short-term may be to the long-term detriment of the Companys shareholders. If faced with actions by activist shareholders, we may not be able to respond effectively to
such actions, which could be disruptive to our business.

We cannot assure our shareholders that our normal course issuer bid will
enhance shareholder value, and share repurchases could increase the volatility of our share price.

We repurchase shares in the
open market and otherwise for cancellation pursuant to normal course issuer bids (NCIB), which allow us to repurchase a certain number of shares during a specified period. Under our new NCIB, we are authorized to repurchase up to an
aggregate of approximately 4,000,000 common shares over the twelve-month period ending July 13, 2017. The timing and actual number of shares repurchased will depend on a variety of factors including the timing of open trading windows, price,
corporate and regulatory requirements, and other market conditions. The existence of the NCIB, however, could also cause our share price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity
for our subordinate voting shares.



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|Item 4: | Information on the Company
|------- | --------------------------



| | A. | HISTORY AND DEVELOPMENT OF THE COMPANY
| | -- | --------------------------------------

The business of IPG was established when
Intertape Systems Inc., a predecessor of the Company, established a pressure-sensitive tape manufacturing facility in Montreal, Canada. The Company was incorporated under the Canada Business Corporations Act on December 22, 1989 under
the name 171695 Canada Inc. On October 8, 1991, the Company filed a Certificate of Amendment changing its name to Intertape Polymer Group Inc. A Certificate of Amalgamation was filed by the Company on August 31,
1993, at which time the Company was amalgamated with EBAC Holdings Inc.

The Companys corporate headquarters is located at 9999
Cavendish Blvd., Suite 200, Ville St. Laurent, Québec, Canada H4M 2X5 and the address and telephone number of its registered office is 800 Place Victoria, Suite 3700, Montréal, Québec H4Z 1E9, c/o Fasken Martineau Dumoulin LLP,
(514) 397-7400.

In the last five years, the Company has undertaken a number of significant
manufacturing plant rationalization initiatives in an effort to achieve its goal of being a low-cost producer of its products along with having world class assets at its manufacturing facilities. The Company
sold its Brantford, Ontario, facility (which it had closed during the second quarter of 2011) in January 2013. In the fourth quarter of 2012, the Company ceased manufacturing operations at its Richmond, Kentucky, manufacturing facility and
transferred operations to its Carbondale, Illinois facility during the first quarter of 2013. The Company sold the Richmond, Kentucky facility in the fourth quarter of 2014. In addition, the Company consolidated its North American shrink film
production at its Tremonton, Utah facility in 2013.

As the result of an internal restructuring, effective December 31, 2012,
the Company liquidated and dissolved ECP L.P. and ECP GP II Inc., its Canadian operating companies, and all business, assets and liabilities were transferred to Intertape Polymer Inc., another Canadian subsidiary of the Company. Also effective
December 31, 2012, the Company liquidated and dissolved Polymer International Corp., a Virginia corporation, and all of its assets and liabilities are with Intertape Polymer Corp., a Delaware corporation, a US subsidiary of the Company.

In February 2013, the Company announced plans to relocate and modernize its Columbia, South Carolina, manufacturing facility and in June 2013,
acquired property in Blythewood, South Carolina, which is located in close proximity to the Columbia, South Carolina plant. As of December 31, 2016, the Company had completed commissioning efforts in relation to the duct and masking tape
production lines in Blythewood, South Carolina. The Company continues to work aggressively on optimizing the masking tape production process mainly through minimization of production waste and machine downtime as well as achieving target quality
levels on one of the masking tape products. As of December 31, 2016, capital expenditures for this project totaled approximately $60.7 million, of which $2.7 million was spent in 2012, $21.8 million in 2013, $24.3 million in
2014, $7.9 million in 2015, and $3.7 million in 2016. At this time, it is not expected that a material amount of additional capital expenditures will be required to achieve further improvement.

Effective October 30, 2014, the Company completed an additional internal restructuring to reorganize the capital structure of several of
its legal entities to more efficiently manage its intercompany debt. The results of this restructuring were (in addition to certain transfers of certain intercompany receivables, payables and notes): (a) IPG Holdings LP was dissolved; (b) all
of the preferred shares in IPG (US) Holdings Inc. were redeemed and cancelled, with Intertape Polymer Group Inc. owning all of the common shares of IPG (US) Holdings Inc.; (c) Intertape Polymer Group Inc. formed IPG Luxembourg S.à r.l, a
Luxembourg private limited liability company (société à responsabilité limitée) as a wholly owned subsidiary of Intertape Polymer Group Inc. and (d) Intertape Polymer Corp. transferred all of its preferred
equity interests in Intertape Polymer Inc. to IPG (US) Inc.

On April 7, 2015, the Company purchased 100% of the issued and
outstanding common stock of BP Acquisition Corporation (which wholly-owns a subsidiary, Better Packages, Inc.) (Better Packages), a leading supplier of water-activated tape dispensers. The Company expects the Better Packages acquisition
to further extend the Companys product offering and global presence in the rapidly growing e-commerce market. The Company paid a purchase price of $15.9 million in cash. Effective September 1,
2015, along with certain related transfers of certain intercompany receivables, payables and notes, on or about the same date, Intertape Polymer US Inc. was dissolved.

On October 4, 2015, the Columbia, South Carolina manufacturing facility was damaged by significant rainfall and subsequent severe
flooding. The damages sustained were considerable and resulted in the facility being shut down permanently.



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On November 2, 2015, the Company purchased 100% of the issued and outstanding common shares
of RJM Manufacturing, Inc. (d/b/a TaraTape), a manufacturer of filament and pressure-sensitive tapes. Intertape Polymer Corp. paid in cash, funded primarily from the Companys Revolving Credit Facility, a purchase price of
$11.0 million in cash. As part of the Companys plan to realize operational synergies from the TaraTape acquisition, the Company set out a plan to close its Fairless Hills, Pennsylvania manufacturing facility and ceased manufacturing
operations as of December 31, 2016. In order to accommodate the related production volume, the Company has leveraged production capacity in its Carbondale, Illinois and Danville, Virginia manufacturing facilities and will continue to do so.

On February 16, 2016, the Company announced it will invest $44 to $49 million in the construction of a greenfield manufacturing
facility in Midland, North Carolina, with a goal to increase its manufacturing capacity of water-activated tapes by the end of 2017.

On
September 16, 2016, IPG Mauritius Ltd., a newly formed subsidiary of the Company, under a Share Purchase Agreement, dated September 2, 2016, purchased a 74% ownership stake in Powerband a global supplier of acrylic adhesive-based carton
sealing tapes and stretch films located in Daman, India. The remaining 26% will continue to be held by the Desai family which founded the company in 1994. The Company has approved a plan to expand the production capacity within the Daman,
India manufacturing facility and to expand capacity by investing in the construction of a greenfield manufacturing facility in India (Powerband Investment Projects). Capital expenditures for the Powerband Investment Projects are
currently estimated to total approximately $20 million and the plan for the additional capacity in the current manufacturing facility is expected to be completed by mid-2017 while the greenfield facility
is expected to be operating in 2018.

The Companys total capital expenditures in connection with property, plant and equipment were
$50.0 million, $34.3 million, and $40.6 million for the years 2016, 2015, and 2014, respectively. Capital expenditures for the year ended December 31, 2016 were primarily for property, plant and equipment to support the following
strategic and growth initiatives: the water-activated tape capacity expansion in Midland, North Carolina ($13.7 million), the shrink film capacity expansion at the Portugal manufacturing facility ($5.4 million), the expansion of the Companys
specialty tape product offering ($2.7 million), the Powerband Investment Projects ($1.5 million), and technology upgrade and capacity expansion of stretch film production in the Danville, Virginia manufacturing facility ($1.4 million). Capital
expenditures for the year ended December 31, 2015 were primarily for property, plant and equipment to support the following strategic and growth initiatives: the new facility in Blythewood, South Carolina ($7.9 million), the water-activated
tape capacity expansion in Midland, North Carolina ($4.2 million), shrink film capacity expansion at the Portugal manufacturing facility ($3.9 million), and the expansion of the Companys specialty tape product offering ($3.2 million). Capital
expenditures for the year ended December 31, 2014 of $40.6 million were primarily for the new facility in Blythewood, South Carolina and updating existing manufacturing equipment and obtaining new equipment. The Company funded the 2016
capital expenditures through its cash flows from operations and funds available under the Revolving Credit Facility. On a related note, the Company typically relies upon cash flows from operations and funds available under the Revolving Credit
Facility to fund capital expenditures.



| | B. | BUSINESS OVERVIEW
| | -- | -----------------

The Company operates in the specialty packaging industry in North
America. The Company develops, manufactures and sells a variety of paper and film-based pressure-sensitive and water-activated tapes, polyethylene and specialized polyolefin packaging films, woven coated fabrics and complementary packaging systems
for industrial and retail use. The Companys products primarily consist of carton sealing tapes, including pressure-sensitive and water-activated tapes; packaging equipment; industrial and performance specialty tapes including masking, duct,
electrical and reinforced filament tapes; shrink film; stretch wrap; lumberwrap, structure fabrics, geomembrane fabrics; and non-manufactured flexible intermediate bulk containers (FIBCs). Most of
the Companys products are made from similar processes. A vast majority of the Companys products, while brought to market through various distribution channels, generally have similar economic characteristics.

The Company has approximately2,200 employees with operations in 17locations, including 11 manufacturing facilities in North
America, one in Europe,and one in India.

The Company has assembled a broad range of products by leveraging its manufacturing
technologies, its research and development capabilities, global sourcing expertise and its strategic acquisition program. Over the years, the Company has made a number of strategic acquisitions, including the 2016 acquisition of a 74% ownership
stake in Powerband and the 2015 TaraTape and Better Packages acquisitions, in order to offer a broader range of products to better serve its markets.The Companys extensive product line permits the Company to offer tailored solutions to
a wide range of end-markets including food processing, fulfillment, consumer, building and construction, oil and gas, transportation, agriculture, aerospace, appliance, general manufacturing, marine,
composites and military applications.



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Overview of Periods

2014

In 2014,IPG hired Jeffrey Crystal, who was appointed Chief Financial Officer effective May 9, 2014. Bernard J. Pitzs tenure as chief financial officer ended on January 30, 2014. Michael C. Jay, Corporate Controller since 2011, assumed
the duties of interim Chief Financial Officer from January 30, 2014 to May 9, 2014.

In March 2014, IPG increased the amount
available under the Equipment Finance Agreement dated August 14, 2012 from $24.0 million to $25.7 million and also entered into its final capital lease schedule under this agreement for $3.5 million. The average of the fixed
interest rates of the capital leases as of December 31, 2014 was 2.87%.

On June 11, 2014, IPGs Board of Directors adopted:
(a) the Performance Share Unit Plan (PSU Plan) and (b) the Deferred Share Unit Plan (DSU Plan). The PSU Plan is administered by the Compensation Committee of the Board of Directors of the Company and authorizes the
Company to award PSUs to eligible persons. The DSU Plan is administered by the Compensation Committee of the Board of Directors of the Company and authorizes the Company to award DSUs to any member of the Board of Directors of the Company that is
not an executive officer or employee of the Company. A maximum of 1,000,000 common shares may be issued from treasury under the PSU Plan. A maximum of 250,000 common shares may be issued from treasury under the DSU Plan.

On July 7, 2014, IPG announced an NCIB effective on July 10, 2014. In connection with this NCIB, the Company was entitled to
repurchase for cancellation up to 2,000,000 of the Companys common shares issued and outstanding. The NCIB was set to expire on July 9, 2015. As of December 31, 2014, the Company had repurchased 597,500 common shares at an average
price of CDN$14.35 per share, including commissions, for a total purchase price of $7.8 million.

On July 7, 2014, IPGs
Board of Directors modified the Companys dividend policy to increase the annualized dividend by 50% from $0.32 to $0.48 per common share.

On August 5, 2014, the Board of Directors appointed Mr. Frank Di Tomaso as a new board member of the Company.

Effective October 30, 2014, IPG completed an internal restructuring to reorganize the capital structure of several of its legal entities
to more efficiently manage its intercompany debt. The results of this restructuring were (in addition to certain transfers of certain intercompany receivables, payables and notes): (a) IPG Holdings LP was dissolved; (b) all of the preferred
shares in IPG (US) Holdings Inc. were redeemed and cancelled, with Intertape Polymer Group Inc. owning all of the common shares of IPG (US) Holdings Inc.; (c) Intertape Polymer Group Inc. formed IPG Luxembourg Finance S.à r.l, a Luxembourg
private limited liability company (société à responsabilité limitée) as a wholly owned subsidiary of Intertape Polymer Group Inc. and (d) Intertape Polymer Corp. transferred all of its preferred equity
interests in Intertape Polymer Inc. to IPG (US) Inc.

On November 18, 2014, IPG entered into a new Revolving Credit Facility
Agreement which provides for a five-year US$300 million Revolving Credit Facility. The Revolving Credit Facility replaced the Companys previous asset-based loan facility and prepaid in full the outstanding balances of the Real Estate Loan
and South Carolina Mortgage. The Revolving Credit Facility Agreement includes an incremental accordion feature of US$150 million, which will enable the Company to increase the limit of this facility (subject to the Revolving Credit Facility
Agreements terms and lender approval) if needed. The Revolving Credit Facility matures on November 18, 2019 and bears an interest rate based primarily on the LIBOR rate plus a spread varying between 100 and 225 basis points (125 basis
points as of December 31, 2014) depending on the consolidated total leverage ratio.

In December 2014, the Company sold the Richmond,
Kentucky manufacturing facility and received net proceeds of $2.3 million.

2015

On April 7, 2015, the Company purchased 100% of the issued and outstanding common stock of Better Packages, a leading supplier of
water-activated tape dispensers.

The Company transferred production of duct tape to the new Blythewood facility in early April 2015.
During the second and third quarters of 2015, commissioning of the duct tape production line was ongoing in order to work toward the attainment of target levels of product quality balanced with targeted production efficiency. Although the Company
was able to meet customer demand for duct tape during the second and third quarters of 2015, there were production yield and operating inefficiencies related to the ramp-up



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of duct tape production that had a negative impact on results in these quarters and resulted in an extended timeline for the project. However, these inefficiencies improved throughout the year
and production was close to reaching targeted performance levels in early 2016. In the fourth quarter of 2015, the Company began limited production and sales of masking tape from the Blythewood facility. As of December 31, 2016, the Company had
completed commissioning efforts in relation to the duct and masking tape production lines in Blythewood, South Carolina. The Company continues to work aggressively on optimizing the masking tape production process mainly through minimization of
production waste and machine downtime as well as achieving target quality levels on one of the masking tape products.

On June 4,
2015, the Board of Directors appointed Mr. George J. Bunze as the new Chairman of the Board following the retirement of the former Chairman, Mr. Eric E. Baker.

Effective July 10, 2015, the NCIB (effective on July 10, 2014 and scheduled to expire on July 9, 2015) was renewed. In
connection with this NCIB, the Company was entitled to repurchase for cancellation up to 2,000,000 of the Companys common shares issued and outstanding. This renewed NCIB expires on July 9, 2016. On November 11, 2015, the Toronto
Stock Exchange (TSX) approved an amendment to the Companys NCIB, as a result of which the Company is entitled to repurchase for cancellation up to 4,000,000 common shares.

On August 12, 2015, the Companys Board of Directors approved a change in the quarterly dividend policy by increasing the dividend
from $0.12 to $0.13 per share.

In August 2015, one of the Companys wholly-owned subsidiaries entered into a Partially Forgivable
Loan. The loan was entered into with Agencia para Investmento Comercio Externo de Portugal, EPE (AICEP), the Portuguese agency for investment and external trade, as part of financing a capital expansion project. The loan totalled approximately
$1.2 million at December 31, 2015 (1.1 million). Based on the terms of the agreement, 50% of the loan will be forgiven in 2020 based on satisfying certain 2019 targets, including financial metrics and headcount additions. The
partially forgivable loan is non-interest bearing and semi-annual installments of principal are due beginning in July 2018 through January 2024.

On October 4, 2015, the Columbia, South Carolina manufacturing facility was damaged by significant rainfall and subsequent severe
flooding. The damages sustained were considerable and resulted in the facility being shut down permanently. The Company had planned to shut down this facility by the end of the second quarter of 2016 so this represents a timeline of eight to nine
months earlier.

In October 2015, one of the Companys wholly-owned subsidiaries entered into a long-term debt agreement containing a
short-term credit line and a long-term loan for the purpose of financing a capital expansion project. No amounts were outstanding and approximately $2.3 million (2.5 million) of the loan was available as of December 31, 2015. Both
credit lines bear interest at the rate of 6 month EURIBOR (Euro Interbank Offered Rate) plus a premium (125 basis points as of December 31, 2015). The effective interest rate was 1.21% as of December 31, 2015. The short-term credit line
matured in September 2016 and is renewable annually, with interest due quarterly and billed in arrears. The long-term loan has a period for capital use until October 2017 and matures in April 2022, with interest billed in arrears and due bi-annually beginning in April 2018. The loans are secured by a comfort letter issued to the lender by the Company in favour of its wholly-owned subsidiary.

During 2015, the Company entered into interest swap agreements designated as cash flow hedges. The terms of the interest swap agreements are
as follows:



|                |  |                   |  |                 |            |  |            |         |                         |  |       |  
|--------------- |  | ----------------- |  | --------------- | ---------- |  | ---------- | ------- | ----------------------- |  | ----- | -
|Effective Date  |  | Maturity          |  | Notional Amount |            |  | Settlement |         | Fixed interestrate paid | 
|March 18, 2015  |  | November 18, 2019 |  | $               | 40,000,000 |  |            | Monthly |                         |  | 1.610 | %
|August 18, 2015 |  | August 20, 2018   |  | $               | 60,000,000 |  |            | Monthly |                         |  | 1.197 | %

On November 2, 2015, the Company purchased 100% of the issued and outstanding common shares of TaraTape,
a manufacturer of filament and pressure-sensitive tapes.



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On November 11, 2015, the Companys Board of Directors adopted a new By-Law 2015-1, requiring advance notice for the nomination of directors.

On November 30, 2015, the Board of Directors appointed Ms. Mary Pat Salomone as a new board member of the Company.

On December 14, 2015, the Company entered into a Shareholders Rights Plan Agreement (the Rights Plan) with CST Trust Company.
The purpose of the Shareholder Rights Plan is to provide IPGs Board of Directors with additional time, in the event of an unsolicited takeover bid, to develop and propose alternatives to the bid and negotiate with the bidder, as well as to
ensure equal treatment of shareholders in the context of an acquisition of control made other than by way of an offer to all shareholders, and lessen the pressure on shareholders to tender to a bid. Under the policies of the TSX, the Rights Plan was
required to be ratified by the shareholders of the Corporation at a meeting held within six months following the adoption of the Rights Plan, failing which the Rights Plan would have been required to be immediately cancelled and any rights issued
thereunder would have been immediately redeemed or cancelled. On June 9, 2016, shareholders approved a resolution ratifying and approving the Rights Plan. For further details on the Rights Plan, see Item 10(C) below.

As of December 31, 2015, management determined it is more likely than not that substantially all of the Companys deferred tax
assets in the Canadian operating entity will be realized based on available evidence such as the cumulative positive financial results for the prior three years, consistent utilization of deferred tax assets, consistent generation of taxable income,
and positive financial projections. Accordingly, the Company recognized the majority of its Canadian operating entitys deferred tax assets, including $3.8 million that were previously derecognized. With respect to the deferred tax assets
at the Canadian corporate holding entity (the Entity), management determined it appropriate to maintain the same positions for the year ended December 31, 2015 as taken for the year ended December 31, 2014 in that the majority
of the Entitys deferred tax assets should continue to be derecognized as of December 31, 2015. The Canadian deferred tax assets remain available to the Company in order to reduce its taxable income in future periods.

2016

On
January 28, 2016 and September 2, 2016, IPG entered into amendments to its Revolving Credit Facility Agreement. The January 28, 2016 amendments included certain language clarifying when a change in control has occurred for purposes of
the Revolving Credit Facility. The September 2, 2016 amendments included certain changes to the covenants and other sections to permit the acquisition of Powerband, as well as some or all of the Powerband Investment Projects, along with certain
customary provisions regarding recent European Union legislation.

On May 9, 2016, the Board of Directors approved an amendment to
the PSU Plan to provide the Company the option of settling PSUs in cash. In the event of cash settlement, the cash payment will equal the number of shares that would otherwise have been issued or delivered to the participant, multiplied by the
volume weighted average trading price of the shares on the TSX for the five consecutive trading days immediately preceding the day of payment. The Board has full discretion to determine the form of settlement of the PSUs and as of December 31,
2016, no such discretion had been used. As a result, the Company had no present obligation to settle the PSUs in cash and the amendment to the PSU Plan had no impact on the treatment of the PSUs as equity-settled share-based payment transactions as
of December 31, 2016. On February 17, 2017, the Board of Directors approved amendments to the PSU Plan and DSU Plan to provide for only cash settlement of PSU and DSU awards, respectively. As a result of the amendment, prospectively and
until award settlement, the Company will remeasure the fair value of the awards on the amendment date and at each reporting period end date and present the cash-settled awards as a liability within other liabilities and not in contributed surplus in
the consolidated balance sheets. Changes in the fair value of the liability will be reflected in selling, general and administrative expense (SG&A).

Additionally, on May 9, 2016, the Board of Directors approved an amendment to the PSU Plan that allowed for accelerated vesting of PSUs
in the event of death, disability or retirement. This amendment required the immediate recognition of expense associated with awards outstanding for certain retirement-eligible participants, the impact of which was $0.4 million for the twelve
months ended December 31, 2016 and was included in earnings in SG&A.

The Company entered into an NCIB to repurchase for
cancellation up to 2,000,000 common shares effective on July 10, 2014. The NCIB was subsequently renewed July 10, 2015 and amended November 11, 2015, to increase the total shares available for repurchase to 4,000,000 common shares.
This NCIB, which was scheduled to expire on July 9, 2016, was renewed for a twelve-month period starting July 14, 2016. This renewed NCIB expires on July 13, 2017. On September 23, 2016, the Company announced that in connection
with its NCIB, IPG has entered into an automatic share purchase plan pursuant to which the securities dealer acting as IPGs agent for the NCIB may acquire, at its discretion, shares on IPGs behalf during the black-out or closed periods under IPGs stock trading policy, subject to certain parameters as to price and number of shares. As of December 31, 2016 and March 8, 2017,
4,000,000 shares remained available for repurchase under the NCIB.



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On August 10, 2016, the Board of Directors amended the Companys dividend policy by
increasing the annualized dividend by 7.7% from $0.52 to $0.56 per share. The Boards decision to increase the dividend was based on the Companys strong financial position and positive outlook.

On September 16, 2016, IPG Mauritius Ltd., a newly formed subsidiary of the Company, under a Share Purchase Agreement, dated
September 2, 2016, purchased a 74% ownership stake in Powerband.The Company has also approved a plan to expand the production capacity within the Daman, India manufacturing facility as well as expand capacity by investing in the
construction of a greenfield manufacturing facility in India. Capital expenditures for the Powerband Investment Projects are currently estimated to total approximately $20 million, and the Powerband Investment Projects after-tax internal rates of return are expected to exceed the Companys hurdle rate of 15%. The Company is planning for the additional capacity in the current manufacturing facility to be completed by mid-2017 while the greenfield facility is expected to be operating in 2018.

On October 19, 2016,
the Company and its insurers reached a settlement for the outstanding property and business interruption claims related to the South Carolina Flood in the amount of $30.0 million, subject to a $0.5 million deductible covering substantially
all of the claimed losses. As of December 31, 2016, the Company received a total of $29.5 million in insurance claim settlement proceeds of which $5.0 million was recorded in manufacturing facility closures, restructuring and other
related charges in 2015 and $12.6 million and $9.8 million were recorded in cost of sales and manufacturing facility closures, restructuring and other related charges, respectively, in 2016. The remaining $2.1 million will be
recognized as a benefit to cost of sales in the first quarter of 2017.

On November 5, 2015, the Companys former Chief
Financial Officer filed a lawsuit against the Company in the United States District Court for the Middle District of Florida alleging certain violations by the Company related to the terms of his employment and his termination. On October 20,
2016, the Company and the former Chief Financial Officer agreed to a settlement of the outstanding litigation (Litigation Settlement). Pursuant to the terms of the confidential settlement agreement, the Company paid $1.9 million in
October 2016 for full and complete settlement of all matters between the parties with respect to the litigation.

As part of its plan to
realize operational synergies from the TaraTape acquisition completed in November 2015, the Company set out a plan to close its Fairless Hills, Pennsylvania manufacturing facility and ceased production as of December 31, 2016. In order to
accommodate the related production volume, the Company has leveraged production capacity in both its Carbondale, Illinois and Danville, Virginia manufacturing facilities and will continue to do so. As a result of the Fairless Hills facility closure,
the Company increased its expectation of total annual synergies from this transaction to between $4 and $6 million from the previous estimate of between $2 and $4 million of additional adjusted EBITDA by the end of 2017. In 2016, the
Company recorded a charge to earnings of $6.0 million, which included $4.0 million in non-cash charges related to impairment of property, plant and equipment, intangible assets and inventory and
$1.9 million in cash charges related to termination benefits, facility restoration costs and other commitments. The Company expects to incur an additional $1 to $2 million mainly in cash charges related primarily to idle facility and
equipment relocation costs in 2017.



|(1) | Products, Markets and Distribution
|--- | ----------------------------------



| | (a) | Tapes
| | --- | -----

The Company manufactures a variety of paper and film based tapes, including
pressure-sensitive and water-activated carton sealing tapes, and industrial and performance specialty tapes including paper, flatback, duct, double-coated, foil, electrical, filament tapes and stencil products.

Management believes the Company is the only packaging company that manufactures carton sealing tapes using all four adhesive technologies: hot
melt, acrylic, natural rubber and water-activated. As a vertically integrated manufacturer, the Company believes it has distinctive capabilities, relative to its competitors, to produce its own film and adhesives used in the manufacture of its
finished tape.

The Companys tape products are manufactured and primarily sold under the Companys Intertape, Central®, American®, Anchor®, and
Crowell® brands to industrial distributors and retailers, and are manufactured for sale to third parties under private brands.



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Tape products launched in 2014, 2015, and 2016 include new transfer adhesive products, clean
removal tensilized polypropylene and filament products, UL rated HVAC tapes, additional specialty masking products, and tape products designed for the electronic fulfillment market.Further information regarding these new products can be
found in Item 4.B.5 Research and Development and New Products below.

In 2014, the Company enhanced its offering of packaging
solutions with the introductions of: ExlfilmPlus® GPL, a new high performance cross linked polyolefin shrink film; Ripcord, a knife free solution to open packages; RG317, a filament tape
for L-clip box closure applications; Auto H2O uniform semi-automatic water-activated case sealer and other complementary products.

In 2015, the Company focused on increasing its offering of specialty tape products including additional masking, foil, double-coated and ATA
tapes.

In 2016, the Company expanded its product offering of water-activated tape products that are designed for highly automated
fulfillment operations as well as water-activated tape products designed for printability. Also in 2016, the Company expanded its masking tape offering to include FineLine masking tapes, which are low profile masking tapes using a washi tape
backing.

For the years ending December 31, 2016, December 31, 2015, and December 31, 2014, tapes accounted for 67%, 68%,
and 65%, respectively, of the Companys revenue.

The Companys tape products consist of two main product groups, Carton Sealing
Tapes and Industrial & Specialty Tapes.

Carton Sealing Tapes

Carton sealing tapes are sold primarily under the Intertape and Central® brands
to industrial distributors and leading retailers, as well as to third parties under private brands. Management believes the Company is the only company worldwide that produces carton sealing tapes using all four adhesive technologies: hot melt,
acrylic, natural rubber and water- activated. The Company also sells the application equipment required for the dispensing of its carton sealing tapes.

Hot Melt Tape

Hot
melt carton sealing tape is a polypropylene film coated with a synthetic rubber adhesive which offers a wide range of application flexibility and is typically used in carton sealing applications. The Companys primary competitors are 3M Co.,
Shurtape Technologies LLC and Vibac Group.

Acrylic Tape

Acrylic carton sealing tape is a polypropylene film coated with an aqueous, pressure-sensitive acrylic adhesive which is best suited for
applications where performance is required within a broad range of temperatures from less than 40°F (4°C) to greater than 120°F
(49°C). The Companys primary competitors are 3M Co., GTA, Primetac (Pitamas), Vibac Group and other imported Asian products.

Natural Rubber Tape

Natural rubber carton sealing tape is a polypropylene film coated with natural rubber adhesive and is unique among the carton sealing tapes
because of its robust adhesion properties. This tape is ideally suited for conditions involving hot, dusty, humid or cold environments. Typical uses include moving and storage industry applications, as well as packaging and shipping. The
Companys primary competitors are Vibac Group and imported products from Europe.

Water-Activated Tape

Water-activated carton sealing tape is typically manufactured using a filament reinforced kraft paper substrate and a starch based adhesive
that is activated by water. Water-activated tape is used primarily in applications where a strong mechanical bond or tamper evidence is required. Typical end-use markets include retail fulfillment centers,
third-party logistics providers (3PLs), furniture manufacturers and the apparel industry. The Companys primary competitor is Holland Manufacturing Co. Inc.



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Industrial & Specialty Tapes

The Company produces eight primary industrial and specialty products sold primarily under the Intertape, American® and Anchor® brands: paper tape, flatback tape, duct tape, double-coated tape, foil tape, electrical tape, filament tape and stencil
products.

Paper Tape

Paper tape is manufactured from a crepe paper substrate coated with a natural rubber or a synthetic rubber adhesive. Paper tape is used for a
variety of performance and general purpose end-use applications. Product applications include paint masking (consumer, contractor, automotive, aerospace and marine), splicing, bundling/packaging, and general
light duty applications. The Companys primary competitors for this product are 3M Co., Shurtape Technologies, LLC, Cantech and tesa tape, inc.

Flatback Tape

Flatback tape is manufactured using a smooth kraft paper substrate coated with a natural rubber/SIS blended adhesive. Flatback tape is designed
with low elongation and is widely used in applications such as splicing where the tape should not be distorted. Typical applications for flatback tape include splicing, printable identification tapes, label products and carton closure. The
Companys primary competitors for this product are 3M Co. and Shurtape Technologies, LLC.

Duct Tape

Duct tape is manufactured from a polyethylene film that has been reinforced with scrim and coated with natural/synthetic rubber blend adhesive
or specialty polymer adhesives. Duct tape is primarily used by general consumers for a wide range of applications. Duct tapes are also used in maintenance, repair and operations, in the HVAC (heating, ventilation and air conditioning) markets,
construction and in the convention and entertainment industries. The Companys primary competitors for this product are Berry Plastics Corp., 3M Co. and Shurtape Technologies, LLC.

Double-Coated Tape

Double-coated tape is manufactured from a paper, foam, or film substrate and is coated on both sides with a variety of adhesive systems.
Double-coated tape also uses a release liner made from paper or film that prevents the tape from sticking to itself. Double-coated tape is typically used to join two dissimilar surfaces. The Companys double-coated tape products are used across
a range of markets that include aerospace, graphics, transportation, converting and nameplates. The Companys primary competitors for this product are 3M Co., tesa tape, inc., and Scapa Group plc.

Foil Tape

Foil
tape is manufactured using an aluminum substrate and a variety of adhesive systems. The tape is designed for applications that range from HVAC, building and construction, aerospace, transportation, industrial, and general purpose. The products are
UV resistant, have reflective and flame retardant properties, and remain flexible to resist cracking and lifting around irregular or curved surfaces. The Companys primary competitors for this product are 3M Co., Berry Plastics and Avery
Dennison Corp.

Electrical and Electronic Tape

Electrical and electronic tape is manufactured from a number of different substrates, including paper, polyester, glass cloth and a variety of
adhesive systems that include rubber, acrylic and silicone adhesives. Electrical and electronic tapes are engineered to meet stringent application specifications and many electrical and electronic tapes are Underwriters Laboratories (UL) component
listed. The Companys primary competitors for this product are 3M Co., Nitto Denko, Saint Gobain, Bondtec, and H-Old.

Filament Tape

Filament tape is a film or paper-backed adhesive tape with fiberglass, polyester fibers embedded in the adhesive to provide high tensile
strength. Primary applications for filament tape include temporary holding, bundling and unitizing, subsea umbilical cables (oil and gas), metal coil tabbing, and agricultural applications. The Companys primary competitors for this product are
3M Co. and Shurtape Technologies, LLC.



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Stencil Products

Stencil products are manufactured from a calendered natural/synthetic rubber blended substrate with an acrylic adhesive and specially
formulated adhesives. Stencil products are used in applications within the sign and monument manufacturing markets to protect a surface where high pressure blasting is required. The Companys primary competitor for this product is 3M Co.



| | (b) | Films
| | --- | -----

The Company also manufactures a variety of polyethylene and specialized
polyolefin films, as well as complementary packaging systems, for industrial use and retail use, including shrink film and stretch wrap. As a vertically integrated manufacturer, the Company uses internally manufactured films to produce tape
products.

The Companys film products are marketed under the Companys brands includingSuperFlex®, StretchFlex®, ExlfilmPlus®, and Exlfilm® to industrial distributors and retailers, and are manufactured for sale to third parties under private brands.

For the year ended December 31, 2016, December 31, 2015, and December 31, 2014, films accounted for 19%, 16%, 19%,
respectively, of the Companys revenue.

The Companys film products consist of two main product groups: film and protective
packaging.

The Company primarily produces two film product lines:
(1) SuperFlex® and StretchFlex® stretch wrap; and (2) ExlfilmPlus®
and Exlfilm® shrink film.

Stretch Wrap

Stretch wrap is a single or multi-layer plastic film that can be stretched without application of heat and which has the characteristic of
trying to return to its original length thereby applying force on the wrapped load. It is used industrially to wrap pallets of various products ensuring a solid load for shipping. The Company uses technology that it believes is state-of-the-art for the manufacturing of its stretch film products.

SuperFlex® is a high performance, light gauge stretch film which offers customers
good security for their loads but at a low cost per load. Genesys®, Genesys®Ultra,
Fortress®, ProLite® and Orbit Air B are SuperFlex® brand products. Since
2014, the Company has re-formulated its legacy Genesys®, Genesys®Ultra and ProLite® brand products to enhance their performance capabilities. AEP Industries, Inc., Amtopp, Berry Plastics Corp., Malpack (Canada), and Paragon Films produce competitive products.

StretchFlex® is the Companys regular duty, typically a heavier gauge of stretch
film which also provides the customer with secure loads at a low price per pound. SFI, SSC, SFIII, Hand Wrap II and Hand Wrap IV are StretchFlex® brand products.Since 2014, the Company
has re-formulated its legacy SFI products to enhance performance capabilities. Competitors include AEP Industries Inc., Berry Plastics Corp., Sigma Plastics Group and Amtopp.

Shrink Film

ExlfilmPlus® and Exlfilm®
shrink film are specialty plastic films which shrink under controlled heat to conform to a packages shape. The process permits the over-wrapping of a vast array of products of varying sizes and dimensions with a single packaging line.
ExlfilmPlus® and Exlfilm® are used to package paper products, food, toys, games, sporting goods, hardware and housewares and a variety
of other products. In 2014, the Company introduced ExlfilmPlus® GPL, a new high performance cross linked polyolefin shrink film. The Companys primary competitors for this product are
Sealed Air Corp. and Clysar LLC.

The Company entered the European shrink film market through its investment in Fibope in April 1995. The
Company initially purchased a 50% equity interest in Fibope, acquiring the remaining 50% equity stake in July 2003. Fibope operates as an autonomous unit within the Company.

IPG subsidiary Fibope, which operates as an autonomous unit within the Company, produces a full range of shrink film products for sale in the
European Community. Raw materials are primarily sourced within Europe, with multiple sources utilized to ensure stability of supply and a competitive price environment.



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Protective Packaging

Air Pillows

Air
pillows are manufactured from polyethylene film and are inflated at the point of use with an air pillow machine. Air pillows are used as packaging material for void fill and cushioning applications. Typical
end-use markets for air pillows include 3PLs retail fulfillment houses and contract packaging operations. The Companys primary competitors for this product are Pregis Corp., Sealed Air Corp., Storopack,
Inc., Free-Flow Packaging International Inc. and Polyair Inter Pack Inc.

Complementary Packaging Systems

Machinery

IPG
provides complementary packaging systems under the Better Packages(R) and Interpack brands. Machinery that makes up IPGs Complementary Packaging Systems include, but are not limited
to, mechanical systems for case sealing applications with the use of long roll carton sealing tape, as well as water-activated tape produced by IPG. They also include IPGs void fill machines and bagging machines. These machines are used in
production lines at the packaging level. They are also widely used in the fulfillment industries. These systems add value by providing efficient packaging processes to a variety of industrial customers. The companys primary competitors are 3M,
Loveshaw, BestPack, Marsh and Phoenix.



| | (c) | Woven Coated Fabrics
| | --- | --------------------

The Company develops and manufactures innovative industrial
packaging, protective covering, barrier and liner products utilizing engineered coated polyolefin fabrics, paper and other laminated materials. Its products are sold through multiple channels in a wide number of industries including lumber,
construction, oil and gas, and agriculture.

The Companys woven coated fabrics are categorized in four markets: (A) building
and construction, (B) agro-environmental, (C) specialty fabrics, and (D) industrial packaging. For the three years ended December 31, 2016, December 31, 2015, and December 31, 2014, woven coated fabric products
accounted for 13%, 15% and 15%, of the Companys revenue, respectively.

Building and Construction Products

The Companys building and construction product group includes protective wrap for kiln dried lumber, membrane barrier products such as
house wrap, window and door flashing, membrane structure fabrics used in clear span buildings, synthetic roof underlayment, and insulation facing, which are used directly in residential and commercial construction. The Company also supplies
packaging over-wrap sleeves for unitizing multiple bags of fiberglass insulation. The Companys primary competitors for these products include InterWrap, Inc., Berry Plastics, Polymer Group International, Alpha ProTech and various producers
from India, China and Korea.

Lumberwrap

The Companys lumberwrap is used to package, unitize, protect and brand lumber during transportation and storage. The product is available
in polyethylene or polypropylene coated fabrics and polyethylene films printed to customer specifications. The Companys primary competitor is InterWrap.

Membrane Structure Fabrics

Nova-Shield® is a lightweight, wide-width, and durable polyolefin fabric used as the
outer skin layer for flexible membrane structures. The introduction and continuous improvement of the Nova-Shield® fabric in the membrane structure market has enabled membrane structure
manufacturers to expand the use of this product beyond agricultural applications. New applications include agriculture barns, amphitheaters, recreational facilities, trade show pavilions, aircraft hangers, and casinos. Developments in the product
line include the patented stacked weave, and AmorKote coatings. The Company sells the Nova-Shield® fabrics to membrane structure manufacturers who design, fabricate, and install the
structures. The Companys primary competitors are Berry Plastics and a number of PVC (polyvinyl chloride) producers.

Roof
Underlayment

IPGs roofing underlayment is a woven synthetic weather barrier installed on the roof before slate, tile or
shingles are applied. The Company believes that IPGs roofing underlayment is lighter and easier to install than standard #30 building felt. To meet these market needs, the Company has a three-tiered (Good, Better, Best) approach in
an attempt to reach all market segments. The Companys primary competitors in this market are InterWrap, Alpha ProTech, a variety of roofing felt producers and a number of competitors from India, China and Korea.



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Agro-Environmental Products

The Company has developed a range of Agro-Environmental products, including bags for packaging glass-fiber insulation, fabrics designed for
conversion into hay covers, grain pile covers, landfill covers, oil field membranes, and canal and pond liners. These fabrics are intended to provide protection during transit and storage and to line waterways and ponds to prevent loss of water and
other liquids.

Geomembrane Fabrics

The Companys AquaMaster® line of geomembrane fabrics is used as irrigation canal
liners, golf course and aquascape pond liners, oil pad liners, hydraulic fracturing ponds and in aquaculture operations. The Company has a broad product offering in this market that includes the traditional extrusion coated woven substrates as well
as manufacturing composite products composed of woven substrates laminated to other materials such as non-woven textiles and polyethylene film. In 2014, in order to help customers specify and use the best
solution for their particular need, the Company re-branded its geomembrane product lines to clearly separate long-term, high-performance products from products used for shorter term applications. The
Companys primary competitors for similar products include Berry Plastics, Mai Weave LLC, InterWrap and Inland Tarp. Competitive products which may be used as substitutes are manufactured by GSE Environmental, Solmax and Raven Industries Inc.

Hay Wrap

Hay
cover products are specially designed fabrics designed to function as protective covers, haystack covers, pit and pond liners and pool covers. The proprietary coating is used to enhance abrasion resistance, flex resistance, seam strength, UV
resistance and longevity. The Companys primary competitors for this product include offshore imports, as well as InterWrap, Mai Weave LLC and Berry Plastics.

Poultry Fabrics

Woven coated polyolefin fabrics are used in the construction of poultry houses in the southern United States. Materials with high ultraviolet
resistance are fabricated into side curtains that regulate ventilation and temperature in buildings. Other materials are used in ceiling construction. The Companys primary competitors for this product are Berry Plastics and Mai Weave LLC.

Specialty Fabrics

The Companys specialty fabric product category is comprised of a variety of specialty materials custom designed for unique applications
or specific customers. The Companys ability to provide polyolefin fabrics in a variety of weights, widths, colors and styles, and to slit, print and perform various other conversion steps, allows it to provide an array of coated products
designed to meet the specific needs of its customers.

Products and applications of specialty fabrics include fabrics designed for
conversion into pool covers, field covers, disaster relief materials, protective covers and construction sheeting, brattice cloth for mine ventilation, underground marking tapes, salt pile covers and industrial packaging.

Primary competitors of the Company for this product include Berry Plastics, Mai Weave LLC and producers from China and Korea.

Industrial Packaging Products

The Companys printed wrap is used to brand and protect a variety of products during transit and storage. For example, the Companys
product is used to cover small recreational vehicles (ATVs) during transportation from their manufacturing location to retail dealers. Primary competitors of the Company for this product include Interwrap Inc. and Covalence Specialty Materials Corp.



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| | (d) | Other
| | --- | -----

The Company also earns revenues from the sale of FIBCs and from royalties from
the sale of film wrap. FIBCs are flexible, intermediate bulk containers generally designed to carry and discharge 1,500 to 3,500 pounds of dry flowable fill products such as chemicals, minerals and dry food ingredients. The market for FIBCs is
highly fragmented. The Company has established proven supply lines for FIBCs with integrated bag manufacturers in India, China and Mexico. Revenue from royalties is earned on the purchases of film wrap by
end-users from another supplier which is used in machines supplied by the Company. During each of the last three years, other revenues accounted for 1% of the Companys revenue.



|(2) | Sales and Marketing
|--- | -------------------

As of December 31, 2016, the Company had 224 sales, customer
service and marketing personnel, including manufacturer representatives. The Company participates in industry trade shows and uses trade advertising as part of its marketing efforts. The Companys customer base is diverse; however, there was
one customer that accounted for approximately 7% of total sales in 2015 and 6.5% of total sales in 2016. Sales of products to customers located in the United States and Canada accounted for approximately 83% and 7% of total sales, respectively, in
2016, 86% and 7% of total sales, respectively, in 2015, and 83% and 8% of total sales, respectively, in 2014.

Many tape and film products
are sold to the market through a network of paper, packaging and industrial distributors throughout North America. The Company also sells carton closing systems, including automatic and semi-automatic carton sealing equipment as well as application
required for the dispensing of its water-activated carton sealing tapes through this same network of distribution. The Companys shrink and stretch film products are typically sold through industrial distributors. Electrical and electronic
tapes are primarily sold through specialty distribution.

The Companys woven coated fabrics are primarily sold directly to end-users. The Company also earns revenues from the sale of FIBCs. FIBCs are sold primarily to end-users and are marketed throughout North America.



|(3) | Seasonality of the Companys Main Business
|--- | ------------------------------------------

The Company does not experience
material seasonality or cyclicality in its operations.



|(4) | Equipment and Raw Materials
|--- | ---------------------------

The Company purchases mostly custom designed manufacturing
equipment, including extruders, coaters, finishing equipment, looms, printers, bag manufacturing machines and injection molds, from manufacturers located in the United States and Western Europe, and participates in the design and upgrading of such
equipment. The Company is not dependent on any one manufacturer for its equipment.

The major raw materials purchased for the
Companys tape products are polypropylene resin, polyethylene resin, synthetic rubber, hydrocarbon resin, and paper (crepe and kraft). The resins and synthetic rubber are generated from petrochemicals which are
by-products of crude oil and natural gas. A significant majority of these products are sourced from North American manufacturers. The majority of paper products are produced by North American paper
manufacturers, although due to volatility in prices of paper products, the Company also sources an increasing amount of raw materials from outside of North America, which are derived from the North American pulp and paper industry. Raw materials
accounted for approximately 65% of reported cost of sales in 2016 and 2015, and 67% in 2014.

The major raw material used in the
Companys film products is polyethylene resin. Polyethylene is a derivative of natural gas petrochemical by-products and/or crude oil.

The major raw materials used to produce the Companys woven coated fabrics are polyethylene and polypropylene resins. Both of these
products are petrochemical based products derived from crude oil and/or natural gas. These products are predominantly sourced from North American petrochemical manufacturers.

The prices of most of the major raw materials noted above can be subject to significant volatility, primarily influenced by commodity price
fluctuations for crude oil and natural gas. In addition, while the Company maintains a number of suppliers for these raw materials, the Company is dependent on such suppliers to maintain the availability of the Companys raw materials. If any
of its suppliers are unable to deliver raw materials to the Company for an extended period of time, there is no assurance that the Companys raw material requirements would be met by other suppliers on acceptable terms, or at all, which could
have a material adverse effect on the Companys results of operations.



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|(5) | Research and Development and New Products
|--- | -----------------------------------------

The Companys strategy is to create
growth opportunities through enhancements of existing products and the introduction of new products. The Companys research and development efforts continue to focus on new products, technology platform developments, new product processes and
formulations. As described in the sections that follow, the Company introduced 35 new products in 2016, 42new products in 2015, and 38 new products in 2014.

During 2014, the Company expanded its line of carton closure solutions with the addition of Ripcord, a knife free solution to open
packages and RG317, a filament tape for L-clip box closure applications.

In 2014, the Company
launched its new Auto H2O uniform semi-automatic water-activated case sealer. The Auto H2O case sealers patented technology provides a reliable and low maintenance automatic sealing system for reinforced water-activated tape to
seal corrugated containers.

In 2014, the Company expanded its offering of specialty tape products with the introduction of AC778, a
metalized BOPP tape and ALF301, an aluminum foil tape with superior UV, chemical and temperature resistant properties.

In 2014, the
Company introduced ExlfilmPlus® GPL, the Companys newest performance shrink film. This film is a cost savings alternative to standard, heavier gauge films. The premium resin formulation
exhibits exceptional machinability and high speed processing capabilities.

In 2015, the Company continued to focus significant R&D
resources on the transition of duct and masking tape products from the old Columbia, South Carolina facility to the new Blythewood, South Carolina facility. This transition involved significant product modifications with the most notable being
producing products with environmentally-friendly solventless technology in the new facility.

In 2015, the Company expanded its product
offering to include a range of masking tapes designed for multiple surfaces as well as technically demanding applications. During 2015, the Company also introduced a direct printable hot melt carton sealing tape, which is key product for the
fulfillment industry.

In 2015, the Company bolstered its Protective Packaging offering with product additions in both its air pillows and
tandem bagging product lines.

In 2016, the Company focused on expansion by engaging in acquisition initiatives to expand the
complementary products it can provide to customers. As a result, resources traditionally dedicated to new product development were redirected to these efforts in order to validate and integrate these initiatives.

In 2016, the Company expanded its product offering of water-activated tape products that are designed for highly automated fulfillment
operations as well as water-activated tape products designed for printability. Also in 2016, the Company expanded its masking tape offering to include FineLine masking tapes, which are low profile masking tapes using a washi tape backing.

The Companys research expenses in 2016, 2015, and 2014 totaled $10.8 million, $9.5 million, and $7.9 million,
respectively.



|(6) | Trademarks and Patents
|--- | ----------------------

The Company markets its tape products under the trademarks
Intertape, Central®, Crowell®, American®, TaraTape & Design®, and TARA TAPE®and various private labels. The Companys shrink wrap is sold under the registered trademark ExlfilmPlus® and Exlfilm®. Its stretch films are sold under the trademark SuperFlex® and
StretchFlex®.

The Company markets its open mouth bags under the registered
trademark NovaPac®. Other key engineered coated products, including polyolefin fabrics are sold under the registered trademarks
NovaThene®, NovaShield®, NovaSeal®, NovaWrap, and NovaFlash®.



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The Company has approximately 156 active registered trademarks, 94 in the United States, 29 in
Canada, 7 in Mexico, and 26 in foreign jurisdictions, which include trademarks acquired from American Tape, Anchor, Rexford Paper Company, Central Products Company, The Crowell Corporation, Flexia, Better Packages, TaraTape & Design®, and TARA TAPE®. The Company currently has 9 pending trademark applications, 7 in the United States, and 2in foreign
jurisdictions.

The Company has pursued US and foreign patents in select areas where it believes that unique products offer a competitive
advantage in profitable markets. The Companys 96 granted patents and 45 pending patent applications include engineered coated products and film for which the Company has 21 patents and 3 pending applications, tape products for which it
has 41 patents and 25 pending applications, adhesive products and manufacture for which it has 25 patents and 4 pending applications, other products for which it has 9 patents and 13 pending applications.



|(7) | Competition
|--- | -----------

The Company competes with other manufacturers of plastic packaging and
pressure-sensitive adhesive products as well as manufacturers of alternative packaging products, such as paper, cardboard and paper-plastic combinations. Some of these competitors are larger companies with greater financial resources than the
Company. Management believes that competition, while primarily based on price and quality, is also based on other factors, including product performance characteristics and service. Please refer to Item 4.B.1 above for a discussion of the
Companys main competitors by product.

The Company believes that significant barriers to entry exist in its addressable market.
Management considers the principal barriers to be the high cost of vertical integration which it believes is necessary to operate competitively, the technical expertise in respect to various processes and equipment operation, and the difficulties
and expense of developing an adequate distribution network.



|(8) | Environmental Initiatives and Regulation
|--- | ----------------------------------------



| | (a) | Initiatives
| | --- | -----------

The Company has and continues to be focused on reducing waste and
minimizing any environmental impact throughout its manufacturing process, or footprint left behind by the line of products manufactured and marketed by the Company. The stewardship program is a commitment by management and employees of the Company
to continually look for opportunities to lower the Companys environmental impact to include minimizing energy intensity and greenhouse gas emissions. The Company has implemented and continues to implement activities, changes and programs that
are designed to reduce waste in the manufacturing process; reduce the footprint left behind by its products, processes and employees; increase the recycling of its products; provide alternative solutions to less environmentally friendly products or
applications; reduce consumption of raw materials, fuel and other energy sources; reduce pollutants released through air, water and waste; and improve the safety and health of employees.

The Company continues to focus on its environmental initiative to save energy. In August 2009, the Company became an ENERGY STAR® Industrial Partner, which is a voluntary partnership with the U.S. Environmental Protection Agency (EPA) to improve energy efficiency and fight global warming. Intertape Polymer Group
(IPG®) as an ENERGY STAR® Industrial Partner joined the fight against global warming by improving the efficiency of its buildings and
facilities. The EPA recognized IPG as a 2014 and 2015 ENERGY STAR Partner of the Year for strategically managing and improving the energy efficiency in its operating locations. In 2016, the EPA presented IPG the ENERGY STAR Sustained Excellence
Award, which is the highest level of EPA recognition. In addition, several IPG facilities have met the EPAs ENERGY STAR Challenge for Industry, which is to reduce energy intensity by 10% within 5 years. IPG facilities that have met the
EPAs ENERGY STAR Challenge for Industry have achieved an average energy intensity reduction of 21%. The reductions have cut greenhouse gas emissions at these IPGs plants by 42,000 metric tons over the past 5 years, which equals the
emissions from the electricity use of 6,000 homes.

The transition of manufacturing operations from IPGs Columbia, South Carolina
facility to IPGs new Blythewood, South Carolina facility has further enhanced IPGs environmental stewardship. The Blythewood plant uses non-solvent technologies that do not utilize volatile organic
compounds in the manufacturing process and do not generate hazardous waste. Additionally, the transition of manufacturing operations to the Blythewood plant has resulted in increased manufacturing efficiencies.



| | (b) | Regulation
| | --- | ----------

The Companys operations are subject to extensive environmental
regulation in each of the countries in which it maintains facilities. For example, United States (federal, state and local), Canadian (federal, provincial and municipal) and Indian (federal, state and local) environmental laws applicable to the
Company include statutes and regulations intended to: (i) impose certain obligations



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with respect to site contamination and to allocate the cost of investigating, monitoring and remedying soil and groundwater contamination among specifically identified parties; (ii) prevent
future soil and groundwater contamination; (iii) impose national ambient standards and, in some cases, emission standards, for air pollutants which present a risk to public health, welfare or the natural environment; (iv) govern the
handling, management, treatment, storage and disposal of hazardous wastes and substances; and (v) regulate the discharge of pollutants into waterways.

The Companys use of hazardous substances in its manufacturing processes and the generation of hazardous wastes not only by the Company,
but by prior occupants of its facilities, suggest that hazardous substances may be present at or near certain of the Companys facilities or may come to be located there in the future. Consequently, the Company is required to monitor closely
its compliance under all the various environmental laws and regulations applicable to the Company. In addition, the Company arranges for the off-site disposal of hazardous substances generated in the ordinary
course of its business.

The Company obtains Phase I or similar environmental site assessments, and Phase II environmental site
assessments, if necessary, for most of the manufacturing facilities it owns or leases at the time the Company either acquires or leases such facilities. These assessments typically include general inspections and may involve soil sampling and/or
ground water analysis. The assessments have not revealed any material or significant environmental liability other than, or in addition to, the $2.5 million liability as of December 31, 2016, accrued in provisions in the Companys
consolidated balance sheet, that, based on current information, the Company believes will have a material adverse effect on it. Nevertheless, these assessments may not reveal all potential environmental liabilities and current assessments are not
available for all facilities. Consequently, there may be material environmental liabilities that the Company is not aware of. In addition, ongoing clean up and containment operations may not be adequate for purposes of future laws and regulations.
The conditions of the Companys properties could also be affected in the future by neighboring operations or the conditions of the land in the vicinity of the Companys properties. These developments and others, such as increasingly
stringent environmental laws and regulations, increasingly strict enforcement of environmental laws and regulations, or claims for damage to property or injury to persons resulting from the environmental, health or safety impact of the
Companys operations, may cause it to incur significant costs and liabilities that could have a material adverse effect on the Company.

The Company believes that all of its facilities are in material compliance with applicable environmental laws and regulations, and that the
Company has obtained, and is in material compliance with, all material permits required under environmental laws and regulations.

The new
Blythewood plant uses low environmental impact technologies. After the closure of the Columbia, South Carolina Plant, its production was relocated to this new plant and other existing Company plants. The reduced environmental impacts from Blythewood
plant operations minimize applicability of environmental laws and permit requirements. Blythewood operations only require a minor EPA air emission permit and the facility is not classified as a large quantity generator of hazardous waste as
opposed to the previous Columbia plant. The transition of manufacturing operations from the Columbia plant to the Blythewood plant has significantly reduced carbon emissions and hazardous air pollutants that require EPA reporting and
significantly reduced carbon emissions.

In addition, although certain of the Companys facilities emit regulated pollutants into the
air, the emissions are within current permitted limits, including applicable Maximum Achievable Control Technology requirements.

The
Company and its operating subsidiaries are required to maintain numerous environmental permits and governmental approvals for their operations. Some of the environmental permits and governmental approvals that have been issued to the Company or its
operating subsidiaries contain conditions and restrictions, including restrictions or limits on emissions and discharges of pollutants and contaminants, or may have limited terms. If the Company or any of its operating subsidiaries fails to satisfy
these conditions or to comply with these restrictions, it may become subject to enforcement actions and the operation of the relevant facilities could be adversely affected. The Company may also be subject to fines, penalties or additional costs.
The Company or its operating subsidiaries may not be able to renew, maintain or obtain all environmental permits and governmental approvals required for the continued operation or further development of its facilities, as a result of which the
operation of its facilities may be limited or suspended.



| | C. | ORGANIZATIONAL STRUCTURE
| | -- | ------------------------

Intertape Polymer Group Inc. is a holding company which owns
various operating companies in the United States, Canada and internationally. Intertape Polymer Inc., a Canadian corporation, is the principal operating company for the Companys Canadian operations. Intertape Polymer Corp., a Delaware
corporation, is the principal operating company for the Companys United States operations.



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The table below lists for each of the subsidiaries of the Company, their respective place of
incorporation or constitution, as the case may be, and the percentage of voting securities beneficially owned or over which control or direction is exercised directly or indirectly by Intertape Polymer Group Inc.



|                                                |  |                                       |  |                                  
|----------------------------------------------- |  | ------------------------------------- |  | ---------------------------------
|Entity                                          |  | Place of Incorporationor Constitution |  | Percentage of Ownershipor Control
|Intertape Polymer Group Inc.                    |  | Canada                                |  | Parent                           
|Intertape Polymer Inc.                          |  | Canada                                |  | 100%                             
|Spuntech Fabrics Inc.*                          |  | Canada                                |  | 100%                             
|Intertape Polymer Corp.                         |  | Delaware                              |  | 100%                             
|Intertape Woven Products Services, S.A. de C.V. |  | Mexico                                |  | 100%                             
|Intertape Woven Products, S.A. de C.V.          |  | Mexico                                |  | 100%                             
|IPG Luxembourg Finance S.à r.l                  |  | Luxembourg                            |  | 100%                             
|IPG Mauritius Holding Company Ltd.              |  | Mauritius                             |  | 100%                             
|IPG Mauritius II Ltd.                           |  | Mauritius                             |  | 100%                             
|IPG Mauritius Ltd.                              |  | Mauritius                             |  | 100%                             
|IPG (US) Inc.                                   |  | Delaware                              |  | 100%                             
|IPG (US) Holdings Inc.                          |  | Delaware                              |  | 100%                             
|BP Acquisition Corporation                      |  | Connecticut                           |  | 100%                             
|Better Packages, Inc.                           |  | Delaware                              |  | 100%                             
|Powerband Industries Private Limited            |  | India                                 |  | 74%                              
|RJM Manufacturing, LLC (d/b/a TaraTape)         |  | Delaware                              |  | 100%                             
|Fibope Portuguesa-Filmes Biorientados S.A.      |  | Portugal                              |  | 100%                             
|Intertape Polymer Europe GmbH                   |  | Germany                               |  | 100%                             



|* | Dormant
|- | -------



| | D. | PROPERTY, PLANTS AND EQUIPMENT
| | -- | ------------------------------



|                                                             |  |        |  |                                             |  |                                                      |  |                       |  |                     
|------------------------------------------------------------ |  | ------ |  | ------------------------------------------- |  | ---------------------------------------------------- |  | --------------------- |  | --------------------
|Location                                                     |  | Status |  | Use                                         |  | Products                                             |  | Square Feet           |  | PropertySize (Acres)
|100 Paramount Drive, Suite 300
Sarasota, Florida 34232       |  | Leased |  | Office                                      |  | N/A                                                  |  | 31,942                |  |                     
|                                                             |  |        |  |                                             | 
|2000 South Beltline Boulevard
Columbia, South Carolina 29201 |  | Owned  |  | Idle                                        |  | N/A                                                  |  | 7 Buildings  499,770 |  | 86.48               
|                                                             |  |        |  |                                             | 
|1091 Carolina Pines Drive
Blythewood, South Carolina 29016   |  | Owned  |  | Manufacturing                               |  | Tapes (paper, duct)                                  |  | 350,000               |  | 33.83               
|                                                             |  |        |  |                                             | 
|360 Ringgold Industrial Parkway
Danville, Virginia 24540     |  | Leased |  | RegionalDistributionCenter                  |  | All products                                         |  | 199,600               |  |                     
|                                                             |  |        |  |                                             | 
|10101 Nordel Court
Delta, British Columbia
V4G 1J8           |  | Leased |  | Manufacturing                               |  | Woven coated products                                |  | 54,274                |  |                     
|                                                             |  |        |  |                                             | 
|317 Kendall Street (2)
Marysville, Michigan 48040            |  | Owned  |  | Manufacturing                               |  | Tapes (paper, reinforced)                            |  | 5 Buildings  226,016 |  | 11.53               
|                                                             |  |        |  |                                             | 
|741 4th Street
Menasha, Wisconsin 54952                      |  | Owned  |  | Manufacturing                               |  | Tapes (water-
activated)                             |  | 165,134               |  | 5.91                
|                                                             |  |        |  |                                             | 
|748 Sheboygan Street
Menasha, Wisconsin 54953                |  | Owned  |  | Office Building                             |  | N/A                                                  |  | 16,251                |  | Incl above          
|                                                             |  |        |  |                                             | 
|760 West 1000 North
Tremonton, Utah 84337                    |  | Owned  |  | Manufacturing                               |  | Films (stretch, shrink)                              |  | 115,000               |  | 17.00               
|                                                             |  |        |  |                                             | 
|13722 Bill McGee Road
Midland, North Carolina 28107          |  | Owned  |  | (currently under construction)Manufacturing |  | Tapes water-
activated (intention once operational) |  | 144,000               |  | 40.54               



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|                                                                             |  |        |  |                                                            |  |                                                    |  |                                                   |  |                     
|---------------------------------------------------------------------------- |  | ------ |  | ---------------------------------------------------------- |  | -------------------------------------------------- |  | ------------------------------------------------- |  | --------------------
|Location                                                                     |  | Status |  | Use                                                        |  | Products                                           |  | Square Feet                                       |  | PropertySize (Acres)
|50 Abbey Avenue
Truro, Nova Scotia                                           |  | Owned  |  | Manufacturing                                              |  | Woven coated
products                              |  | 306,200                                           |  | 13.00               
|                                                                             |  |        |  |                                                            | 
|543 Willow Street
Truro, Nova Scotia                                         |  | Leased |  | Warehouse                                                  |  | N/A                                                |  | 27,000                                            |  |                     
|                                                                             |  |        |  |                                                            | 
|9942 Currie Davis Drive,
Suite 23B
Tampa, Florida 33619                      |  | Leased |  | Manufacturing                                              |  | Tape dispensing machinery                          |  | 17,000                                            |  |                     
|                                                                             |  |        |  |                                                            | 
|2200 North McRoy Drive
Carbondale, Illinois 62901                            |  | Owned  |  | Manufacturing                                              |  | Tapes electrical, filament, specialty             |  | 190,324                                           |  | 29.9                
|                                                                             |  |        |  |                                                            | 
|410 E. Lyerla Road
Herrin, Illinois 62948                                    |  | Leased |  | Warehouse                                                  |  | Tapes  electrical, filament, specialty            |  | 25,269                                            |  |                     
|                                                                             |  |        |  |                                                            | 
|1095 S. 4th Avenue
Brighton, Colorado 80601                                  |  | Leased |  | Manufacturing                                              |  | Film                                               |  | Manufacturing & Office  252,940Warehouse 21,450 |  |                     
|                                                                             |  |        |  |                                                            | 
|1101 Eagle Springs Road
Danville, Virginia 24540                             |  | Owned  |  | Manufacturing                                              |  | Carton sealing tape, stretch film, acrylic
coating |  | 289,195                                           |  | 26.0                
|                                                                             |  |        |  |                                                            | 
|341 Bullys Street
Eagle Pass, Texas 78852                                    |  | Leased |  | Warehouse                                                  |  | FIBCs                                              |  | 6,000                                             |  |                     
|                                                                             |  |        |  |                                                            | 
|4-6 Hershey Drive
Ansonia, Connecticut                                       |  | Leased |  | Manufacturing                                              |  | Tape dispensing machinery                          |  | 27,600                                            |  |                     
|                                                                             |  |        |  |                                                            | 
|250 Canal Road
Fairless Hills, Pennsylvania                                  |  | Leased |  | Idle  Leaseterminates Oct31, 2017                         |  | N/A                                                |  | 88,326                                            |  |                     
|                                                                             |  |        |  |                                                            | 
|1536 Cty Rd O
Neenah, Wisconsin 54957                                        |  | Leased |  | Distribution                                               |  | Tapes  water-activated                            |  | 114,650                                           |  |                     
|                                                                             |  |        |  |                                                            | 
|1407 The Boulevard, Suite E
Rayne, Louisiana 70578                           |  | Leased |  | Offices                                                    |  | N/A                                                |  | 1,472                                             |  |                     
|                                                                             |  |        |  |                                                            | 
|9999 Cavendish Boulevard.,
Suite 200
St. Laurent, Quebec H4M 2X5             |  | Leased |  | Offices                                                    |  | N/A                                                |  | 8,500                                             |  |                     
|                                                                             |  |        |  |                                                            | 
|Gronfahrtweg 3
24955 Harrislee
Germany                                       |  | Leased |  | Office                                                     |  | N/A                                                |  | 560                                               |  |                     
|                                                                             |  |        |  |                                                            | 
|Lugar de Vilares-Barqueiros
4740-676 Barqueiros BCL
Barcelos, Portugal       |  | Owned  |  | Manufacturingand Distribution                              |  | Shrink film                                        |  | 35,500                                            |  | 5.4                 
|                                                                             |  |        |  |                                                            | 
|20 Rue de Peupliers
L-2328 Luxembourg
Grand Duchy of Luxembourg              |  | Leased |  | Office                                                     |  | N/A                                                |  | 108                                               |  |                     
|                                                                             |  |        |  |                                                            | 
|Powerband
354/3,4,5 Vapi-Kachigam RoadDaman, India 396210                    |  | Owned  |  | Manufacturingand Distribution                              |  | Carton sealing tape, stretch film                  |  | 120,000                                           |  | 6.79                
|                                                                             |  |        |  |                                                            | 
|Powerband
Plot # Z/103/B
Dahej SEZ - II
Lakhigam
Taluka: Vagra Dist, Bharuch |  | Owned  |  | (currently underconstruction)Manufacturingand Distribution |  | Tape products(intention once operational)          |  | 210,000Under construction                         |  | 20.28               

We consider each of the properties in the table above to be adequate for its purpose and suitably utilized
according to the individual nature and requirements of the relevant operations.



32



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##### Table of Contents

The Company also owns inventory that is temporarily located at facilities owned by various
third-party logistics service providers. As these facilities are not owned or leased by the Company, they have been excluded from the summary table above.

The Company continued to move forward in 2016 on several of its initiatives to improve productivity, increase capacity, and manufacture new
products. Capital expenditures for the replacement of machinery and equipment during 2014, 2015, and 2016 totaled $40.6 million, $34.3 million, and $50.0 million respectively. The Company typically relies upon cash flows from
operations and funds available under the Revolving Credit Facility to fund capital expenditures. In 2014, capital expenditures were also financed in part by an Equipment Finance Agreement, the terms of which are summarized in Item 4.B. above.

The Company has relocated and shut down permanently its Columbia, South Carolina manufacturing facility. In June 2013, the Company acquired
property in Blythewood, South Carolina financed by an $8.5 million mortgage with Wells Fargo National Association (in November 2014, the Company prepaid this loan in full with proceeds from the Revolving Credit Facility). As of
December 31, 2016, the Company had completed commissioning efforts in relation to the duct and masking tape production lines in Blythewood, South Carolina. The Company continues to work aggressively on optimizing the masking tape production
process mainly through minimization of production waste and machine downtime as well as achieving target quality levels on one of the masking tape products. As of December 31, 2016, capital expenditures for this project totaled approximately
$60.7 million. At this time, it is not expected that a material amount of additional capital expenditures will be required to achieve further improvement.

For further details on capital expenditures regarding construction, expansion or improvement of above listed facilities, see Item 4.A. above.



|Item 4A: | Unresolved Staff Comments
|-------- | -------------------------

Not Applicable.



|Item 5: | Operating and Financial Review and Prospects (Managements Discussion & Analysis)
|------- | ---------------------------------------------------------------------------------



33



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##### Table of Contents

This Managements Discussion and Analysis (MD&A) is intended to provide the reader with a
better understanding of the business, strategy and performance of the Company as well as how it manages certain risks and capital resources. This MD&A should be read in conjunction with the Companys audited consolidated financial
statements and notes thereto as of December 31, 2016 and 2015 and for the three-year period ended December 31, 2016.

For the purposes of
preparing this MD&A, the Company considers the materiality of information. Information is considered material if the Company believes at the time of preparing this MD&A: (i) such information results in, or would reasonably be expected
to result in, a significant change in the market price or value of the common shares of the Company; (ii) there is a substantial likelihood that a reasonable investor would consider it important in making an investment decision; and/or
(iii) it would significantly alter the total mix of information available to investors. The Company evaluates materiality with reference to all relevant circumstances, including potential market sensitivity.

Except where otherwise indicated, all financial information presented in this MD&A, including tabular amounts, is prepared in accordance with
International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS or GAAP) and is expressed in US dollars. Variance, ratio and percentage changes in this MD&A are based on
unrounded numbers.

Financial Highlights

(In
millions of US dollars, except per share amounts, selected ratios, and trading volume information)

(Unaudited)



|                                                      |  |      |       |   |      |  |       |      |  |  |       |  
|----------------------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | ---- |  |  | ----- | -
|                                                      |  | 2016 |       |   | 2015 |  |       | 2014 | 
|                                                      |  |      | $     |   |      |  | $     |      |  |  | $     |  
|Operations                                            |  |      |       |   |      |  |       |      |  |  |       |  
|Revenue                                               |  |      | 808.8 |   |      |  | 781.9 |      |  |  | 812.7 |  
|Gross margin (1)                                      |  |      | 23.7  | % |      |  | 21.5  | %    |  |  | 20.1  | %
|Net earnings attributable to Company shareholders
(2) |  |      | 51.1  |   |      |  | 56.7  |      |  |  | 35.8  |  
|Adjusted net earnings (3)(4)                          |  |      | 59.7  |   |      |  | 57.6  |      |  |  | 44.8  |  
|Adjusted EBITDA (3)                                   |  |      | 119.5 |   |      |  | 102.0 |      |  |  | 103.9 |  
|Cash flows from operating activities                  |  |      | 108.1 |   |      |  | 102.3 |      |  |  | 86.9  |  
|Free cash flows (3)                                   |  |      | 58.2  |   |      |  | 68.0  |      |  |  | 46.3  |  
|Capital expenditures (5)                              |  |      | 50.0  |   |      |  | 34.3  |      |  |  | 40.6  |  
|Effective Tax Rate (6)                                |  |      | 27.7  | % |      |  | 16.2  | %    |  |  | 39.0  | %
|                                                      |  |      |      
|Per Common Share                                      |  |      |       |   |      |  |       |      |  |  |       |  
|IPG Net Earnings - diluted                            |  |      | 0.85  |   |      |  | 0.93  |      |  |  | 0.58  |  
|Adjusted net earnings - diluted
(3)(4)                |  |      | 0.99  |   |      |  | 0.94  |      |  |  | 0.72  |  
|Dividend paid per share                               |  |      | 0.54  |   |      |  | 0.50  |      |  |  | 0.40  |  
|                                                      |  |      |      
|Financial Position                                    |  |      |       |   |      |  |       |      |  |  |       |  
|Working capital (7)                                   |  |      | 130.6 |   |      |  | 130.5 |      |  |  | 128.2 |  
|Total assets                                          |  |      | 580.6 |   |      |  | 487.3 |      |  |  | 466.7 |  
|Net debt (8)                                          |  |      | 158.9 |   |      |  | 135.2 |      |  |  | 114.9 |  
|Total equity attributable to Company shareholders     |  |      | 236.6 |   |      |  | 216.7 |      |  |  | 227.5 |  
|Cash and loan availability(9)                         |  |      | 158.2 |   |      |  | 182.3 |      |  |  | 206.2 |  





(continued)

34



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Financial Highlights(continued)



|                                                   |  |      |        |   |      |  |        |      |  |  |        |  
|-------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | ---- |  |  | ------ | -
|                                                   |  | 2016 |        |   | 2015 |  |        | 2014 | 
|                                                   |  |      | $      |   |      |  | $      |      |  |  | $      |  
|Selected Ratios                                    |  |      |        |   |      |  |        |      |  |  |        |  
|Current Ratio (10)                                 |  |      | 2.17   |   |      |  | 2.45   |      |  |  | 2.50   |  
|Leverage Ratio (3) (11)                            |  |      | 1.50   |   |      |  | 1.50   |      |  |  | 1.19   |  
|Return on equity (12)                              |  |      | 22.6   | % |      |  | 25.5   | %    |  |  | 15.6   | %
|                                                   |  |      |       
|Stock Information                                  |  |      |        |   |      |  |        |      |  |  |        |  
|Weighted average shares outstanding - diluted
(13) |  |      | 60,369 |   |      |  | 61,111 |      |  |  | 62,061 |  
|Shares outstanding as of December 31
(13)          |  |      | 59,060 |   |      |  | 58,668 |      |  |  | 60,436 |  
|                                                   |  |      |       
|The Toronto Stock Exchange (CDN$)                  |  |      |        |   |      |  |        |      |  |  |        |  
|Share price as of December 31                      |  |      | 25.18  |   |      |  | 18.69  |      |  |  | 18.61  |  
|High: 52 weeks                                     |  |      | 25.74  |   |      |  | 20.51  |      |  |  | 19.95  |  
|Low: 52 weeks                                      |  |      | 15.46  |   |      |  | 13.67  |      |  |  | 11.12  |  



|(1) | Gross profit divided by revenue
|--- | -------------------------------

|(2) | Net earnings attributable to Company shareholders (IPG Net Earnings)
|--- | ----------------------------------------------------------------------

|(3) | These are non-GAAP financial measures defined below and accompanied by the reconciliation to the closest GAAP financial measure. Refer to the section below entitled Non-GAAP Financial Measures.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | As disclosed in the Companys press release on March 1, 2017, adjusted net earnings and adjusted earnings per share for the interim and annual periods in
fiscal 2014 and 2015, and the first three interim periods in fiscal 2016 were amended to correct a clerical error in the calculation of the income tax effect of the adjustments made in determining Adjusted Net Earnings and Adjusted Earnings Per
Share. For the purpose of a consistent presentation of all periods, certain prior period amounts have been conformed to current period presentation.Refer to the section below entitled Non-GAAP
Financial Measures.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Purchases of property, plant and equipment
|--- | ------------------------------------------

|(6) | Refer to Note 5  Income Taxes to the Companys Financial Statements
|--- | --------------------------------------------------------------------

|(7) | Current assets less current liabilities
|--- | ---------------------------------------

|(8) | Borrowings, current and non-current, less cash
|--- | ----------------------------------------------

|(9) | Refer to the section below entitled Liquidity
|--- | -----------------------------------------------

|(10) | Current assets divided by current liabilities
|---- | ---------------------------------------------

|(11) | Borrowings, current and non-current, divided by adjusted EBITDA
|---- | ---------------------------------------------------------------

|(12) | IPG Net Earnings divided by average total equity attributable to Company shareholders
|---- | -------------------------------------------------------------------------------------

|(13) | In thousands
|---- | ------------

2016 Share Prices

|                                  |  |      |       |  |     |  |       |       |  |  |        |  |  |  |         | 
|--------------------------------- |  | ---- | ----- |  | --- |  | ----- | ----- |  |  | ------ |  |  |  | ------- | 
|                                  |  | High |       |  | Low |  |       | Close |  |  | ADV(1) | 
|The Toronto Stock Exchange (CDN$) |  |      |       |  |     |  |       |       |  |  |        |  |  |  |         | 
|Q1                                |  |      | 18.96 |  |     |  | 15.46 |       |  |  | 18.61  |  |  |  | 133,288 | 
|Q2                                |  |      | 21.75 |  |     |  | 18.09 |       |  |  | 21.08  |  |  |  | 150,962 | 
|Q3                                |  |      | 23.72 |  |     |  | 20.06 |       |  |  | 22.64  |  |  |  | 124,173 | 
|Q4                                |  |      | 25.74 |  |     |  | 20.51 |       |  |  | 25.18  |  |  |  | 143,488 | 



|(1) | Represents average daily volume sourced from the Toronto Stock Exchange.
|--- | ------------------------------------------------------------------------



35



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Consolidated Quarterly Statements of Earnings

(In thousands of US dollars, except share and per share amounts)

(Unaudited)



|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|------------------------------------------------------------------------------------------------ |  | ----------- | ------- | - | ----------- |  | ------- | ---- |  |  | ------- | - |  | ---- | ------- | - | ---- |  | ------- | - |  |  | ------- | -
|                                                                                                 |  | 1st Quarter |         |   | 2nd Quarter | 
|                                                                                                 |  | 2016        |         |   | 2015        |  |         | 2014 |  |  | 2016    |   |  | 2015 |         |   | 2014 | 
|                                                                                                 |  |             | $       |   |             |  | $       |      |  |  | $       |   |  |      | $       |   |      |  | $       |   |  |  | $       |  
|Revenue                                                                                          |  |             | 190,816 |   |             |  | 189,009 |      |  |  | 199,948 |   |  |      | 201,517 |   |      |  | 196,586 |   |  |  | 202,925 |  
|Cost of sales                                                                                    |  |             | 149,720 |   |             |  | 151,994 |      |  |  | 157,250 |   |  |      | 149,715 |   |      |  | 154,178 |   |  |  | 158,875 |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Gross profit                                                                                     |  |             | 41,096  |   |             |  | 37,015  |      |  |  | 42,698  |   |  |      | 51,802  |   |      |  | 42,408  |   |  |  | 44,050  |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Gross margin                                                                                     |  |             | 21.5    | % |             |  | 19.6    | %    |  |  | 21.4    | % |  |      | 25.7    | % |      |  | 21.6    | % |  |  | 21.7    | %
|Selling, general and administrative expenses                                                     |  |             | 23,384  |   |             |  | 18,127  |      |  |  | 18,980  |   |  |      | 26,282  |   |      |  | 22,253  |   |  |  | 20,561  |  
|Research expenses                                                                                |  |             | 2,542   |   |             |  | 2,066   |      |  |  | 2,074   |   |  |      | 2,734   |   |      |  | 2,141   |   |  |  | 1,667   |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                 |  |             | 25,926  |   |             |  | 20,193  |      |  |  | 21,054  |   |  |      | 29,016  |   |      |  | 24,394  |   |  |  | 22,228  |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Operating profit before manufacturing facility closures, restructuring and other related
charges |  |             | 15,170  |   |             |  | 16,822  |      |  |  | 21,644  |   |  |      | 22,786  |   |      |  | 18,014  |   |  |  | 21,822  |  
|Manufacturing facility closures, restructuring and other related charges                         |  |             | 1,733   |   |             |  | 660     |      |  |  | 1,384   |   |  |      | 2,090   |   |      |  | 142     |   |  |  | 1,020   |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Operating profit                                                                                 |  |             | 13,437  |   |             |  | 16,162  |      |  |  | 20,260  |   |  |      | 20,696  |   |      |  | 17,872  |   |  |  | 20,802  |  
|Finance costs (income)                                                                           |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Interest                                                                                         |  |             | 982     |   |             |  | 616     |      |  |  | 831     |   |  |      | 1,022   |   |      |  | 982     |   |  |  | 864     |  
|Other expense (income), net                                                                      |  |             | (91     | ) |             |  | (641    | )    |  |  | 352     |   |  |      | 411     |   |      |  | 395     |   |  |  | 370     |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                 |  |             | 892     |   |             |  | (25     | )    |  |  | 1,183   |   |  |      | 1,433   |   |      |  | 1,377   |   |  |  | 1,234   |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Earnings before income tax expense                                                               |  |             | 12,545  |   |             |  | 16,187  |      |  |  | 19,077  |   |  |      | 19,263  |   |      |  | 16,495  |   |  |  | 19,568  |  
|Income tax expense                                                                               |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Current                                                                                          |  |             | 2,076   |   |             |  | 1,063   |      |  |  | 457     |   |  |      | 3,197   |   |      |  | 1,249   |   |  |  | 1,062   |  
|Deferred                                                                                         |  |             | 940     |   |             |  | 3,346   |      |  |  | 6,986   |   |  |      | 2,408   |   |      |  | 3,498   |   |  |  | 6,392   |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                 |  |             | 3,016   |   |             |  | 4,409   |      |  |  | 7,443   |   |  |      | 5,605   |   |      |  | 4,747   |   |  |  | 7,454   |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Net earnings                                                                                     |  |             | 9,530   |   |             |  | 11,778  |      |  |  | 11,634  |   |  |      | 13,658  |   |      |  | 11,748  |   |  |  | 12,114  |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|IPG Net Earnings                                                                                 |  |             | 9,530   |   |             |  | 11,778  |      |  |  | 11,634  |   |  |      | 13,658  |   |      |  | 11,748  |   |  |  | 12,114  |  
|Non-controlling interest                                                                         |  |             |        |   |             |  |        |      |  |  |        |   |  |      |        |   |      |  |        |   |  |  |        |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                 |  |             | 9,530   |   |             |  | 11,778  |      |  |  | 11,634  |   |  |      | 13,658  |   |      |  | 11,748  |   |  |  | 12,114  |  
|                                                                                                 |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|IPG Net Earnings per share                                                                       |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Basic                                                                                            |  |             | 0.16    |   |             |  | 0.19    |      |  |  | 0.19    |   |  |      | 0.23    |   |      |  | 0.20    |   |  |  | 0.20    |  
|Diluted                                                                                          |  |             | 0.16    |   |             |  | 0.19    |      |  |  | 0.19    |   |  |      | 0.22    |   |      |  | 0.19    |   |  |  | 0.19    |  



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Consolidated Quarterly Statements of Earnings

(In thousands of US dollars, except share and per share amounts)

(Unaudited)



|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|------------------------------------------------------------------------------------------------------------- |  | ----------- | ------- | - | ----------- |  | ------- | ---- |  |  | ------- | - |  | ---- | ------- | - | ---- |  | ------- | - |  |  | ------- | -
|                                                                                                              |  | 3rd Quarter |         |   | 4th Quarter | 
|                                                                                                              |  | 2016        |         |   | 2015        |  |         | 2014 |  |  | 2016    |   |  | 2015 |         |   | 2014 | 
|                                                                                                              |  |             | $       |   |             |  | $       |      |  |  | $       |   |  |      | $       |   |      |  | $       |   |  |  | $       |  
|Revenue                                                                                                       |  |             | 206,559 |   |             |  | 200,635 |      |  |  | 209,109 |   |  |      | 209,909 |   |      |  | 195,677 |   |  |  | 200,750 |  
|Cost of sales                                                                                                 |  |             | 161,705 |   |             |  | 157,838 |      |  |  | 168,447 |   |  |      | 156,174 |   |      |  | 149,885 |   |  |  | 164,527 |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Gross profit                                                                                                  |  |             | 44,854  |   |             |  | 42,797  |      |  |  | 40,662  |   |  |      | 53,735  |   |      |  | 45,792  |   |  |  | 36,223  |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Gross margin                                                                                                  |  |             | 21.7    | % |             |  | 21.3    | %    |  |  | 19.4    | % |  |      | 25.6    | % |      |  | 23.4    | % |  |  | 18.0    | %
|Selling, general and administrative expenses                                                                  |  |             | 27,338  |   |             |  | 17,927  |      |  |  | 23,153  |   |  |      | 25,576  |   |      |  | 25,765  |   |  |  | 23,261  |  
|Research expenses                                                                                             |  |             | 2,287   |   |             |  | 2,499   |      |  |  | 1,778   |   |  |      | 3,227   |   |      |  | 2,753   |   |  |  | 2,354   |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                              |  |             | 29,625  |   |             |  | 20,426  |      |  |  | 24,931  |   |  |      | 28,803  |   |      |  | 28,518  |   |  |  | 25,615  |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Operating profit before manufacturing facility closures, restructuring and other related charges
(recoveries) |  |             | 15,229  |   |             |  | 22,371  |      |  |  | 15,731  |   |  |      | 24,932  |   |      |  | 17,274  |   |  |  | 10,608  |  
|Manufacturing facility closures, restructuring and other related charges (recoveries)                         |  |             | 6,329   |   |             |  | 181     |      |  |  | 1,560   |   |  |      | (7,744  | ) |      |  | 2,683   |   |  |  | 963     |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Operating profit                                                                                              |  |             | 8,900   |   |             |  | 22,190  |      |  |  | 14,171  |   |  |      | 32,676  |   |      |  | 14,591  |   |  |  | 9,645   |  
|Finance costs (income)                                                                                        |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Interest                                                                                                      |  |             | 1,158   |   |             |  | 919     |      |  |  | 867     |   |  |      | 1,236   |   |      |  | 1,036   |   |  |  | 2,069   |  
|Other expense (income), net                                                                                   |  |             | 270     |   |             |  | (651    | )    |  |  | 426     |   |  |      | 15      |   |      |  | 504     |   |  |  | 380     |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                              |  |             | 1,428   |   |             |  | 268     |      |  |  | 1,293   |   |  |      | 1,251   |   |      |  | 1,540   |   |  |  | 2,449   |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Earnings before income tax expense (benefit)                                                                  |  |             | 7,472   |   |             |  | 21,922  |      |  |  | 12,878  |   |  |      | 31,425  |   |      |  | 13,051  |   |  |  | 7,196   |  
|Income tax expense (benefit)                                                                                  |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Current                                                                                                       |  |             | 30      |   |             |  | 3,281   |      |  |  | 2,914   |   |  |      | 3,454   |   |      |  | 2,592   |   |  |  | (768    | )
|Deferred                                                                                                      |  |             | 1,192   |   |             |  | 2,987   |      |  |  | 3,953   |   |  |      | 6,272   |   |      |  | (7,033  | ) |  |  | 1,907   |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                              |  |             | 1,222   |   |             |  | 6,268   |      |  |  | 6,867   |   |  |      | 9,726   |   |      |  | (4,441  | ) |  |  | 1,139   |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Net earnings                                                                                                  |  |             | 6,250   |   |             |  | 15,654  |      |  |  | 6,011   |   |  |      | 21,699  |   |      |  | 17,492  |   |  |  | 6,057   |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|IPG Net Earnings                                                                                              |  |             | 6,250   |   |             |  | 15,654  |      |  |  | 6,011   |   |  |      | 21,682  |   |      |  | 17,492  |   |  |  | 6,057   |  
|Non-controlling interest                                                                                      |  |             |        |   |             |  |        |      |  |  |        |   |  |      | 17      |   |      |  |        |   |  |  |        |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|                                                                                                              |  |             | 6,250   |   |             |  | 15,654  |      |  |  | 6,011   |   |  |      | 21,699  |   |      |  | 17,492  |   |  |  | 6,057   |  
|                                                                                                              |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|IPG Net Earnings per share                                                                                    |  |             |         |   |             |  |         |      |  |  |         |   |  |      |         |   |      |  |         |   |  |  |         |  
|Basic                                                                                                         |  |             | 0.11    |   |             |  | 0.26    |      |  |  | 0.10    |   |  |      | 0.37    |   |      |  | 0.30    |   |  |  | 0.10    |  
|Diluted                                                                                                       |  |             | 0.10    |   |             |  | 0.26    |      |  |  | 0.10    |   |  |      | 0.36    |   |      |  | 0.29    |   |  |  | 0.10    |  





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Overview

The Company operates in the global specialty packaging industry. The Company develops, manufactures and sells a variety of paper and film based pressure
sensitive and water-activated tapes, polyethylene and specialized polyolefin packaging films, woven coated fabrics and complementary packaging systems for industrial and retail use. The Companys products primarily consist of: carton sealing
tapes, including pressure sensitive and water-activated tapes; industrial and performance specialty tapes, including masking, duct, electrical and reinforced filament tapes; shrink film; stretch wrap; lumberwrap, structure fabrics and geomembrane
fabrics; and non-manufactured flexible intermediate bulk containers.

The Company reported a 7.3% increase in
revenue for the fourth quarter of 2016 as compared to the fourth quarter of 2015 and a 3.4% increase in revenue for the year ended December 31, 2016 as compared to the year ended December 31, 2015. The increase in revenue compared to the
fourth quarter of 2015 was primarily due to increased sales volume and additional revenue from the Powerband and TaraTape acquisitions, partially offset by a decrease in average selling price, including the impact of product mix. The increase in
revenue for the year ended December 31, 2016 compared to the year ended December 31, 2015 was primarily due to additional revenue from the Better Packages, TaraTape and Powerband acquisitions (Acquisitions), increased sales
volume and a decrease in the South Carolina Commissioning Revenue Reduction (defined later in this document), partially offset by a decrease in average selling price, including the impact of product mix. The Company estimates that its revenue for
the fourth quarter and year ended December 31, 2016 was negatively impacted by the South Carolina Flood (defined later in this document) by approximately $5.0 million and $25.5 million, respectively, which is embedded in the changes
in product mix and sales volume.

Gross margin increased to 25.6% in the fourth quarter of 2016 compared to 23.4% in the fourth quarter of 2015 primarily
due to insurance claim settlement proceeds (Insurance Proceeds) related to the South Carolina Flood and the favourable impact of the Companys manufacturing cost reduction programs. These favourable impacts were partially offset by
the non-recurrence of the reversal of a 2010 impairment for manufacturing equipment of $2.7 million recorded in the fourth quarter of 2015. Gross margin increased to 23.7% in the year ended
December 31, 2016 as compared to 21.5% in 2015. Gross margin increased primarily due to Insurance Proceeds related to the South Carolina Flood, the favourable impact of the Companys manufacturing cost reduction programs, an increase in
the spread between selling prices and raw material costs, and the non-recurrence of South Carolina Duplicate Overhead Costs. These favourable items were partially offset by the negative impact of the South
Carolina Flood and an unfavourable product mix.

The Company estimates that the South Carolina Flood had a net positive impact on its gross profit of
approximately $6.0 million in the fourth quarter and a net negative impact of $1.2 million for the year ended December 31, 2016. The South Carolina Flood impacts are due to lost gross profit related to reductions in revenue as well as
incremental costs from alternative product sourcing net of Insurance Proceeds. In November 2016, the Company received a payment of $19.5 million representing the remaining Insurance Proceeds due to the Company as part of the $30.0 million
settlement reached by the Company and its insurers in October 2016. The settlement was subject to a $0.5 million deductible and covered substantially all of the claimed property and business interruption losses associated with the South
Carolina Flood. Approximately $2.1 million of Insurance Proceeds will be recognized as a benefit to gross profit in the first quarter of 2017.

As
part of its plan to realize operational synergies from the TaraTape acquisition completed in November 2015, the Company set out a plan to close its Fairless Hills, Pennsylvania manufacturing facility and ceased production as of December 31,
2016 (TaraTape Closure). In order to accommodate the related production volume, the Company has leveraged production capacity in both its Carbondale, Illinois and Danville, Virginia manufacturing facilities, and will continue to do
so.    As a result of the TaraTape Closure, the Company increased its expectation of total annual synergies from this transaction to between $4 and $6 million from the previous estimate of between $2 and $4 million of
additional adjusted EBITDA (a non-GAAP financial measure as defined and reconciled later in this document) by the end of 2017.



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IPG Net Earnings for the year ended December 31, 2016 decreased to $51.1 million ($0.87 basic IPG Net
Earnings per share and $0.85 diluted IPG Net Earnings per share) from $56.7 million ($0.95 basic IPG Net Earnings per share and $0.93 diluted IPG Net Earnings per share) for the year ended December 31, 2015. The decrease was primarily due
to increases in (i) selling, general and administrative expenses (SG&A) mainly due to share-based and variable compensation expenses and employee related costs to support growth initiatives in the business, and (ii) income
tax expense. These unfavourable impacts were partially offset by an increase in gross profit.

IPG Net Earnings for the fourth quarter of 2016 increased
to $21.7 million ($0.37 basic IPG Net Earnings per share and $0.36 diluted IPG Net Earnings per share) from $17.5 million ($0.30 basic IPG Net Earnings per share and $0.29 diluted IPG Net Earnings per share) for the fourth quarter of 2015.
The increase was primarily due to a decrease in manufacturing facility closures, restructuring and other related charges and an increase in gross profit, both of which were mainly due to Insurance Proceeds related to the South Carolina Flood. These
favourable impacts were partially offset by an increase in income tax expense.

Adjusted net earnings (a non-GAAP
financial measure as defined and reconciled later in this document) for the year ended December 31, 2016 increased to $59.7 million ($1.02 basic adjusted earnings per share and $0.99 diluted adjusted earnings per share) from
$57.6 million ($0.96 basic adjusted earnings per share and $0.94 diluted adjusted earnings per share) for the year ended December 31, 2015. The increase was primarily due to an increase in gross profit, partially offset by increases in
(i) income tax expense and (ii) SG&A expenses mainly due to variable compensation expense and employee related costs to support growth initiatives in the business.

Adjusted net earnings for the fourth quarter of 2016 increased to $18.0 million ($0.31 basic adjusted earnings per share and $0.30 diluted adjusted
earnings per share) from $16.7 million ($0.28 basic and diluted adjusted earnings per share) for the fourth quarter of 2015. The increase was primarily due to an increase in gross profit, partially offset by an increase in income tax expense.

Adjusted EBITDA increased to $119.5 million for the year ended December 31, 2016 from $102.0 million for the year ended December 31,
2015. The increase was primarily due to an increase in gross profit, partially offset by an increase in SG&A mainly due to variable compensation expense and employee related costs to support growth initiatives in the business.

Adjusted EBITDA increased to $35.3 million for the fourth quarter of 2016 from $24.6 million for the fourth quarter of 2015. The increase was
primarily due to an increase in gross profit.

In 2016, the Board of Directors amended the Companys quarterly dividend policy to increase the
annualized dividend by 7.7% from $0.52 to $0.56 per common share based on the Companys strong financial position and positive outlook.

On
March 8, 2017, the Board of Directors declared a dividend of $0.14 per common share payable on March 31, 2017 to shareholders of record at the close of business on March 21, 2017.

Powerband Acquisition

On September 16, 2016, the
Company, under a Share Purchase Agreement dated September 2, 2016, completed the purchase of 74% of the issued and outstanding shares in Powerband, a global supplier of acrylic adhesive-based carton sealing tapes and stretch films located in
Daman, India. The remaining 26% will continue to be held by the Desai family which founded the Company in 1994. The Powerband acquisition is intended to further extend the Companys product offering and presence in the global packaging market.
Powerband generated approximately $32 million of revenue in its most recently completed fiscal year and it is expected that these acquired operations will be accretive to IPG Net Earnings. The Company paid in cash, funded primarily from the
Companys Revolving Credit Facility (defined later in this document), a purchase price of $41.9 million.



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The Company has approved a plan to expand the production capacity within the Daman, India manufacturing facility
and to expand capacity by investing in the construction of a greenfield manufacturing facility in India (Powerband Investment Projects). Capital expenditures for the Powerband Investment Projects are currently estimated to total
approximately $20 million, and the Projects after-tax internal rates of return are expected to exceed the Companys hurdle rate of 15%. The Company is planning for the additional capacity in
the current manufacturing facility to be completed by mid-2017 while the greenfield facility is expected to be operating in 2018.

The impact of the Powerband acquisition on the Companys earnings was as follows (in millions of US dollars, unaudited):



|                 |  |                                     |     |  |                                             |  |     | 
|---------------- |  | ----------------------------------- | --- |  | ------------------------------------------- |  | --- | 
|                 |  | Three months endedDecember 31, 2016 |     |  | September 16, 2016 throughDecember 31, 2016 | 
|                 |  |                                     | $   |  |                                             |  | $   | 
|Revenue          |  |                                     | 7.6 |  |                                             |  | 7.6 | 
|IPG Net Earnings |  |                                     | 0.1 |  |                                             |  | 0.1 | 

Columbia, South Carolina Flood Update

On October 4, 2015, the Columbia, South Carolina manufacturing facility was damaged by significant rainfall and subsequent severe flooding (South
Carolina Flood). The damages sustained were considerable and resulted in the facility being shut down permanently eight to nine months in advance of the planned shut down. Also as a result of the damage, production of masking tape was
relocated to the Companys Blythewood, South Carolina facility and temporarily to the Marysville, Michigan facility.

In October 2016, the Company
and its insurers reached a settlement for the outstanding property and business interruption claims in the amount of $30.0 million, subject to a $0.5 million deductible, covering substantially all of the claimed losses associated with the
South Carolina Flood. The settlement resulted in a payment of $19.5 million to the Company in November 2016 and a significant net positive impact on IPG Net Earnings of approximately $9.2 million in the fourth quarter of 2016. The Company
has received a total of $29.5 million in Insurance Proceeds of which $5.0 million was recorded in manufacturing facility closures, restructuring and other related charges in the fourth quarter of 2015 and $12.6 million and
$9.8 million were recorded in cost of sales and manufacturing facility closures, restructuring and other related charges, respectively, in 2016. The remaining $2.1 million will be recognized as a benefit to cost of sales in the first
quarter of 2017.

The Company estimates that the South Carolina Flood had the following impacts on its results:



| |  |  | Reductions in revenue of approximately $5.0 million and $25.5 million for the fourth quarter and year ended December 31, 2016, respectively, related to lost sales of masking tape and stencil products, and
including $0.3 million and $3.7 million in quality-related masking tape product returns for the fourth quarter and year ended December 31, 2016, respectively. The masking tape product returns are expected to be non-recurring and the cause has been attributed to the required acceleration of the commercialization of these products following the South Carolina Flood;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Improvement in gross profit of approximately $6.0 million and reduction in gross profit of approximately $1.2 million for the fourth quarter and year ended December 31, 2016, respectively, as a result of
Insurance Proceeds of $8.1 million and $12.6 million for the fourth quarter and year ended December 31, 2016, respectively, included in cost of sales offsetting the negative impacts of the South Carolina Flood;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Improvements in manufacturing facility closures, restructuring and other related recoveries totalling $8.9 million and $4.9 million for the fourth quarter and year ended December 31, 2016, respectively,
as a result of Insurance Proceeds of $9.3 million and $9.8 million for the fourth quarter and year ended December 31, 2016, respectively, included in this caption offsetting the negative impacts of the South Carolina Flood;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | Improvements in IPG Net Earnings of approximately $9.2 million and $2.3 million for the fourth quarter and year ended December 31, 2016, respectively, as a result of Insurance Proceeds totalling
$17.4 million and $22.4 million recognized in earnings during the fourth quarter and year ended December 31, 2016, respectively, offsetting the negative impacts of the South Carolina Flood;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Improvement in adjusted EBITDA of approximately $6.0 million and reduction in adjusted EBITDA of approximately $0.9 million for the fourth quarter and year ended December 31, 2016, respectively; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Improvement in adjusted net earnings of approximately $3.7 million and reduction in adjusted net earnings of $0.8 million for the fourth quarter and year ended December 31, 2016, respectively.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The impact on gross profit, IPG Net Earnings, adjusted net earnings and adjusted EBITDA includes lost gross profit on lost sales and
quality-related masking tape product returns discussed above, as well as incremental costs from temporary alternative product sourcing net of Insurance Proceeds received and recognized in earnings to date. Also included in the IPG Net Earnings
impact above is manufacturing facility closures, restructuring and other related recoveries which includes charges for site clean-up, damage to property and insurance claim preparation costs, offset by the
Insurance Proceeds.

The Company expects the South Carolina Flood to continue to have some negative impact on results during the ongoing effort to restore
masking tape and stencil product sales, including the related production processes, to pre-flood conditions. The remaining $2.1 million of Insurance Proceeds are expected to partially offset these
negative impacts in the first quarter of 2017, however, at this time, it is not possible to predict the extent and timing of the recovery of these lost sales. The Company continues to aggressively re-establish
its production processes and pursue opportunities to recapture the lost sales and expects these efforts will most likely result in improvement in results over time.

South Carolina Project Update

The South Carolina
Project refers to the previously announced relocation and modernization of the Companys Columbia, South Carolina manufacturing operation. This project primarily involved moving the Companys duct tape and masking tape production to
a new state-of-the-art facility in Blythewood, South Carolina as well as moving flatback tape production to the Companys
existing facility in Marysville, Michigan. South Carolina Duplicate Overhead Costs refers to temporary operating cost increases related to operating both plants in South Carolina simultaneously and performing planned actions to mitigate
risk associated with new technology, including state-of-the-art equipment, to support the South Carolina Project. South
Carolina Commissioning Revenue Reduction refers to the sales attributed to the commissioning efforts of the production lines that were accounted for as a reduction of revenue and a corresponding reduction of the cost of the South Carolina
Project. In addition, unless otherwise noted, the impact of the South Carolina Commissioning Revenue Reduction on gross profit and capital expenditures is not significant due to the requirement to offset this revenue with the associated cost of
sales in the reclassification of the related gross profit as a reduction of the capital expenditures.

The Blythewood, South Carolina manufacturing
facilitys duct tape production continued to have a net positive impact on gross profit and adjusted EBITDA in the fourth quarter and year ended December 31, 2016. In regards to masking tape production, the Company continues to work
towards optimizing the related production processes, reducing inefficiencies and eliminating certain quality issues in relation to one of the masking tape products. These masking tape production inefficiencies largely offset the cost savings
realized by the duct tape production resulting in a positive impact to the results realized in the fourth quarter and year ended December 31, 2016 of $1.0 million and $3.0 million, respectively. This represents a significant
incremental net positive impact on gross profit and adjusted EBITDA in 2016 when compared to the net negative impact realized in 2015, and is in line with the Companys guidance stating that the Company expected to realize a higher net positive
impact in the fourth quarter as compared to the third quarter of 2016.



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The table below presents the impact of the South Carolina Project on gross profit and adjusted EBITDA:



|                                                                  |  |                                |     |  |                        |  |      |      |  |  |      |  |  |      |      |   |  |  |      |  
|----------------------------------------------------------------- |  | ------------------------------ | --- |  | ---------------------- |  | ---- | ---- |  |  | ---- |  |  | ---- | ---- | - |  |  | ---- | -
|                                                                  |  | Three months endedDecember 31, |     |  | Year endedDecember 31, | 
|                                                                  |  | 2016                           |     |  | 2015                   |  |      | 2016 |  |  | 2015 |  |  | 2014 |     
|                                                                  |  |                                | $   |  |                        |  | $    |      |  |  | $    |  |  |      | $    |   |  |  | $    |  
|Project savings (costs), net of production ramp-up
inefficiencies |  |                                | 1.0 |  |                        |  | (0.0 | )    |  |  | 3.0  |  |  |      | (1.9 | ) |  |  |     |  
|South Carolina Duplicate Overhead Costs                           |  |                                |    |  |                        |  |     |      |  |  |     |  |  |      | (4.3 | ) |  |  | (3.5 | )
|                                                                  |  |                                |     |  |                        |  |      |      |  |  |      |  |  |      |      |   |  |  |      |  
|Impact on gross profit                                            |  |                                | 1.0 |  |                        |  | (0.0 | )    |  |  | 3.0  |  |  |      | (6.2 | ) |  |  | (3.5 | )
|Addback: Non-cash South Carolina Duplicate Overhead
Costs         |  |                                |    |  |                        |  |     |      |  |  |     |  |  |      | 0.4  |   |  |  | 0.7  |  
|                                                                  |  |                                |     |  |                        |  |      |      |  |  |      |  |  |      |      |   |  |  |      |  
|Impact on adjusted EBITDA                                         |  |                                | 1.0 |  |                        |  | (0.0 | )    |  |  | 3.0  |  |  |      | (5.8 | ) |  |  | (2.8 | )

The Company recorded nil and $6.3 million in the fourth quarter and year ended December 31, 2016, respectively, for
the South Carolina Commissioning Revenue Reduction. As previously stated, the impact of the South Carolina Commissioning Revenue Reduction on gross profit is not significant due to the requirement to offset this revenue with the associated cost of
sales in the reclassification of the related gross profit as a reduction of the capital expenditures.

As of December 31, 2016, capital expenditures
for the South Carolina Project since inception totalled $60.7 million. South Carolina Project capital expenditures recorded were nil and $3.7 million for the fourth quarter and year ended December 31, 2016, respectively.

The Company continues to work aggressively on optimizing the masking tape production process mainly through minimization of production waste and machine
downtime as well as achieving target quality levels on one of the masking tape products. While the annualized run-rate of the net savings increased in the fourth quarter of 2016 as compared to the third
quarter of 2016, the Company did not achieve its previously-stated estimate of approximately $13 million of annualized savings by the beginning of 2017. The challenges that continue to be faced in regards to the production waste and machine
downtime related to masking tape production are expected to improve incrementally over time due to the Companys ongoing efforts, but it is uncertain if and when the Company will realize net savings that approach the previous estimate of
approximately $13 million.

Despite the ongoing challenges faced in the South Carolina Project, the Company strongly believes that this leap in
technological capability in terms of production efficiency, capacity and environmental footprint will benefit the Companys operations and competitive position in the long term. As such, the Company remains committed to the Project. At this
time, it is not expected that a material amount of additional capital expenditures will be required to achieve further improvement.

Outlook



| |  |  | The Company expects gross margin for 2017 to be between 23% and 24%.
| | - |  | --------------------------------------------------------------------



| |  |  | Adjusted EBITDA for 2017 is expected to be between $127 and $137 million.
| | - |  | -------------------------------------------------------------------------



| |  |  | Manufacturing cost reductions for 2017 are expected to be between $10 and $12 million.
| | - |  | --------------------------------------------------------------------------------------



| |  |  | Total capital expenditures for 2017 are expected to be between $75 and $85 million.
| | - |  | -----------------------------------------------------------------------------------



| |  |  | The Company expects a 25% to 30% effective tax rate for 2017 and cash taxes paid in 2017 to be approximately half of the income tax expense in 2017, excluding the potential impact of any significant tax reform
legislation and changes in the mix of earnings between jurisdictions.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Revenue, gross margin and adjusted EBITDA in the first quarter of 2017 are expected to be greater than in the first quarter of 2016.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------



42



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##### Table of Contents

Results of Operations

Revenue

Revenue for the year ended December 31, 2016
totalled $808.8 million, a $26.9 million or 3.4% increase from $781.9 million for the year ended December 31, 2015 primarily due to:



| |  |  | Additional revenue of $31.3 million due to the Acquisitions; and
| | - |  | ----------------------------------------------------------------



| |  |  | An increase in sales volume, excluding the Acquisitions, of approximately 1.7% or $13.3 million primarily due to increased demand for the Companys tape and woven products. The Company believes that the
increased sales volume was primarily due to:
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | growth in the carton sealing tape product offerings; and
| | - |  | --------------------------------------------------------



| |  |  | growth in the building and construction market;
| | - |  | -----------------------------------------------

Partially offset by:



| |  |  | a decrease in certain tape product sales due to the South Carolina Flood.
| | - |  | -------------------------------------------------------------------------



| |  |  | A lower South Carolina Commissioning Revenue Reduction of $4.6 million in 2016 as compared to $11.0 million in 2015;
| | - |  | --------------------------------------------------------------------------------------------------------------------

Partially offset by:



| |  |  | A decrease in average selling price, including the impact of product mix, of approximately 2.9% or $22.3 million due to:
| | - |  | ------------------------------------------------------------------------------------------------------------------------



| |  |  | an unfavourable product mix variance primarily in the Companys woven and tape product categories;
| | - |  | --------------------------------------------------------------------------------------------------



| |  |  | lower selling prices mainly driven by lower petroleum-based raw material costs; and
| | - |  | -----------------------------------------------------------------------------------



| |  |  | an unfavourable foreign exchange impact (FX impact) of approximately $2.0 million.
| | - |  | ------------------------------------------------------------------------------------

The
Company estimates that its revenue for the year ended December 31, 2016 was negatively impacted by the South Carolina Flood by approximately $25.5 million, which is embedded in the changes in product mix and sales volume.

Revenue for the year ended December 31, 2015 totalled $781.9 million, a $30.8 million or 3.8% decrease from $812.7 million for the year
ended December 31, 2014 primarily due to:



| |  |  | A decrease in average selling price, including the impact of product mix, of approximately 6% or $49.2 million due to:
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | an unfavourable product mix variance primarily in the Companys tape and woven product categories;
| | - |  | --------------------------------------------------------------------------------------------------



| |  |  | an unfavourable FX impact of approximately $13.3 million; and
| | - |  | -------------------------------------------------------------



| |  |  | lower selling prices mainly driven by lower petroleum-based raw material costs.
| | - |  | -------------------------------------------------------------------------------



| |  |  | The South Carolina Commissioning Revenue Reduction of $11.0 million in 2015 (nil in 2014);
| | - |  | ------------------------------------------------------------------------------------------

Partially offset by:



| |  |  | Additional revenue of $17.7 million due to the Better Packages and TaraTape acquisitions (2015 Acquisitions); and
| | - |  | -------------------------------------------------------------------------------------------------------------------



| |  |  | An increase in sales volume, excluding the 2015 Acquisitions, of approximately 1.4% or $11.6 million primarily due to increased demand for the Companys tape and woven products. The Company believes that the
increased sales volume was primarily due to:
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | growth in the carton sealing tape product offerings; and
| | - |  | --------------------------------------------------------



| |  |  | growth in the building and construction market;
| | - |  | -----------------------------------------------

Partially offset by:



| |  |  | a decrease in certain tape product sales due to the South Carolina Flood.
| | - |  | -------------------------------------------------------------------------

The Company estimates that its
revenue for the year ended December 31, 2015 was negatively impacted by the South Carolina Flood by approximately $8.6 million, which is embedded in the changes in product mix and sales volume.



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Revenue for the fourth quarter of 2016 totalled $209.9 million, a $14.2 million or 7.3% increase from
$195.7 million for the fourth quarter of 2015 primarily due to:



| |  |  | An increase in sales volume, excluding the Powerband and TaraTape acquisitions, of approximately 4.5% or $9.8 million due to an increase in demand for certain tape and woven products. The Company believes that the
increased sales volume was primarily due to:
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | growth in the carton sealing tape product offerings;
| | - |  | ----------------------------------------------------



| |  |  | an increase in certain tape product sales due to the non-recurrence of the South Carolina Flood; and
| | - |  | ----------------------------------------------------------------------------------------------------



| |  |  | growth in the building and construction markets;
| | - |  | ------------------------------------------------



| |  |  | Additional revenue of $8.7 million due to the Powerband and TaraTape acquisitions;
| | - |  | ----------------------------------------------------------------------------------

Partially offset by:



| |  |  | A decrease in average selling price, including the impact of product mix, of approximately 2.2% or $4.3 million primarily due to:
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------



| |  |  | an unfavourable product mix in the Companys tape and woven product categories;
| | - |  | -------------------------------------------------------------------------------

Partially offset by:



| |  |  | price increases in certain film and tape product sales.
| | - |  | -------------------------------------------------------

The Company estimates that its revenue for the fourth
quarter of 2016 and 2015 was negatively impacted by the South Carolina Flood by approximately $5.0 million and $8.6 million, respectively, which is embedded in the changes in product mix and sales volume.

Revenue for the fourth quarter of 2016 totalled $209.9 million, a $3.4 million or 1.6% increase from $206.6 million for the third quarter of
2016 primarily due to:



| |  |  | Additional revenue of $7.6 million due to the Powerband acquisition; and
| | - |  | ------------------------------------------------------------------------



| |  |  | An increase in sales volume, excluding the Powerband acquisition, of approximately 0.7% or $1.5 million primarily due to increased demand for certain tape products. The Company believes that the increased sales
volume was primarily due to seasonally higher volume across the carton sealing tape product offerings;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Partially offset by:



| |  |  | A decrease in average selling price, including the impact of product mix, of approximately 2.8% or $5.7 million due to:
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | an unfavourable product mix variance primarily in the Companys tape products;
| | - |  | ------------------------------------------------------------------------------

Partially
offset by:



| |  |  | price increases in certain film product sales.
| | - |  | ----------------------------------------------

The Company estimates that its revenue for the third and
fourth quarters of 2016 was negatively impacted by the South Carolina Flood by approximately $9.9 million and $5.0 million, respectively, which is embedded in the changes in product mix and sales volume.

Gross Profit and Gross Margin

Gross profit totalled
$191.5 million for the year ended December 31, 2016, a $23.5 million or 14.0% increase from $168.0 million for the year ended December 31, 2015. Gross margin was 23.7% in 2016 and 21.5% in 2015.



| |  |  | Gross profit increased primarily due to Insurance Proceeds related to the South Carolina Flood, the favourable impact of the Companys manufacturing cost reduction programs, an increase in the spread between
selling prices and raw material costs, and additional gross profit from the Acquisitions. These favourable items were partially offset by the negative impact of the South Carolina Flood, an unfavourable product mix variance, and the non-recurrence of the reversal of a 2010 impairment for manufacturing equipment of $2.7 million recorded in the fourth quarter of 2015.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

| |  |  | Gross margin increased primarily due to Insurance Proceeds related to the South Carolina Flood, the favourable impact of the Companys manufacturing cost reduction programs, an increase in the spread between
selling prices and raw material costs, and the non-recurrence of South Carolina Duplicate Overhead Costs. These favourable items were partially offset by the negative impact of the South Carolina Flood and an
unfavourable product mix.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Gross profit totalled $168.0 million for the year ended December 31, 2015, a $4.4 million or 2.7%
increase from $163.6 million for the year ended December 31, 2014. Gross margin was 21.5% in 2015 and 20.1% in 2014.



| |  |  | Gross profit increased primarily due to an increase in the spread between selling prices and lower raw material costs, the favourable impact of the Companys manufacturing cost reduction programs and additional
gross profit from the Better Packages acquisition. These favourable items were partially offset by an unfavourable product mix variance, an unfavourable FX impact and an increase in manufacturing inefficiencies mainly in relation to the South
Carolina Project.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Gross margin increased primarily due to an increase in the spread between selling prices and raw material costs and the favourable impact of the Companys manufacturing cost reduction programs, partially offset by
an unfavourable product mix, an increase in manufacturing inefficiencies mainly related to the South Carolina Project and the decision to change manufacturing locations of certain products to meet customers demand.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Gross profit totalled $53.7 million for the fourth quarter of 2016, a $7.9 million or 17.3% increase from $45.8 million for the fourth quarter
of 2015. Gross margin was 25.6% in the fourth quarter of 2016 and 23.4% in the fourth quarter of 2015.



| |  |  | Gross profit increased primarily due to Insurance Proceeds related to the South Carolina Flood, the favourable impact of the Companys manufacturing cost reduction programs, additional gross profit from the
Acquisitions, and the increase in volume. These favourable items were partially offset by the non-recurrence of the reversal of a 2010 impairment for manufacturing equipment of $2.7 million recorded in
the fourth quarter of 2015.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Gross margin increased primarily due to Insurance Proceeds related to the South Carolina Flood and the favourable impact of the Companys manufacturing cost reduction programs. These favourable items were partially
offset by the non-recurrence of the reversal of a 2010 impairment for manufacturing equipment of $2.7 million recorded in the fourth quarter of 2015.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Gross profit totalled $53.7 million for the fourth quarter of 2016, a $8.9 million or 19.8% increase from $44.9 million for the third quarter
of 2016. Gross margin was 25.6% in the fourth quarter of 2016 and 21.7% in the third quarter of 2016. Gross profit and gross margin increased primarily due to Insurance Proceeds related to the South Carolina Flood and a reduction in the unfavourable
impact of the South Carolina Flood, partially offset by an unfavourable product mix.

Selling, General and Administrative Expenses

SG&A totalled $102.6 million for the year ended December 31, 2016, an $18.5 million or 22.0% increase from $84.1 million for the year
ended December 31, 2015. The increase was primarily due to (i) an increase in share-based and variable compensation expenses, (ii) an increase in employee related costs primarily to support growth initiatives in the business,
(iii) additional SG&A resulting from the Acquisitions and (iv) a provision for the settlement of the outstanding litigation with the Companys former Chief Financial Officer (CFO) recorded in the third quarter of 2016.

SG&A totalled $84.1 million for the year ended December 31, 2015, a $1.9 million or 2.3% decrease from $86.0 million for the year
ended December 31, 2014. The decrease was primarily due to a decrease in share-based and variable compensation expenses as well as a favourable FX impact. These decreases were partially offset by the 2015 Acquisitions and an increase in
employee costs, including health related costs. The increase in employee costs was primarily to support the expected growth of the business.



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##### Table of Contents

As a percentage of revenue, SG&A expenses represented 12.7%, 10.8%, and 10.6% for 2016, 2015 and 2014,
respectively.

SG&A for the fourth quarter of 2016 totalled $25.6 million, a $0.2 million or 0.7% decrease from $25.8 million for the
fourth quarter of 2015. The decrease was primarily due to a decrease in variable and share-based compensation expenses and litigation related professional fees, partially offset by an increase in employee related costs to support growth initiatives
in the business and additional SG&A resulting from the Powerband acquisition.

SG&A for the fourth quarter of 2016 decreased $1.8 million or
6.4% from $27.3 million in the third quarter of 2016. The decrease was primarily due to the provision for the Litigation Settlement recorded in the third quarter and a decrease in share-based compensation expense, partially offset by additional
SG&A resulting from the Powerband acquisition.

Research Expenses

The Company continues to focus its research efforts on potential new products, technology, manufacturing processes and formulations for existing products.
Research expenses totalled $10.8 million for the year ended December 31, 2016, a $1.3 million or 14.1% increase from $9.5 million for the year ended December 31, 2015. The increase was primarily to support product
development initiatives.

Research expenses totalled $9.5 million for the year ended December 31, 2015, a $1.6 million or 20.1% increase
from $7.9 million for the year ended December 31, 2014. The increase was primarily due to ongoing efforts to support the South Carolina Project and other manufacturing cost reduction programs.

Research expenses for the fourth quarter of 2016 totalled $3.2 million, a $0.5 million or 17.3% increase from $2.8 million for the fourth
quarter of 2015, and a $0.9 million or 41.2% increase from $2.3 million for the third quarter of 2016. These increases were primarily to support product development initiatives.

As a percentage of revenue, research expenses represented 1.3%, 1.2% and 1.0% for 2016, 2015 and 2014, respectively.

Manufacturing Facility Closures, Restructuring and Other

As part of its plan to realize operational synergies from the TaraTape acquisition completed in November 2015, the Company set out a plan to close its Fairless
Hills, Pennsylvania manufacturing facility and ceased production as of December 31, 2016. In order to accommodate the related production volume, the Company has leveraged production capacity in both its Carbondale, Illinois and Danville,
Virginia manufacturing facilities and will continue to do so.    As a result of the TaraTape Closure, the Company increased its expectation of total annual synergies from this transaction to between $4 and $6 million from
the previous estimate of between $2 and $4 million of additional adjusted EBITDA by the end of 2017. In 2016, the Company recorded $6.0 million, which included $4.0 million in non-cash charges
related to impairment of property, plant and equipment, intangible assets and inventory and $1.9 million in cash charges related to termination benefits, facility restoration costs and other commitments. The Company expects to incur an
additional $1 to $2 million mainly in cash charges related primarily to idle facility and equipment relocation costs in 2017.

Manufacturing facility
closures, restructuring and other related charges totalled $2.4 million for the year ended December 31, 2016, a $1.3 million decrease from $3.7 million for the year ended December 31, 2015. The decrease was primarily due to
(i) the benefit from Insurance Proceeds, (ii) a reduction in South Carolina Flood charges, and (iii) a reduction in South Carolina Project charges mostly due to the non-recurrence of termination
benefits. These decreases were partially offset by TaraTape Closure charges of $6.0 million. The charges recorded in 2016 for the South Carolina Flood primarily include site clean-up, damage to property
and insurance claim preparation costs totalling approximately $4.9 million. These charges were offset by Insurance Proceeds of $9.8 million for a net benefit of $4.9 million.



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##### Table of Contents

Manufacturing facility closures, restructuring and other related charges totalled $3.7 million for the year
ended December 31, 2015, a $1.3 million decrease from $4.9 million for the year ended December 31, 2014. The decrease was primarily due to the non-recurrence of $1.0 million and
$0.7 million in charges related to the closure of the Richmond, Kentucky manufacturing facility and the relocation of the Langley, British Columbia manufacturing facility to Delta, British Columbia, respectively. The charges recorded in 2015
were primarily related to the South Carolina Project of $1.5 million and the South Carolina Flood of $1.5 million. The South Carolina Project costs primarily include workforce retention and idle facility costs, partially offset by a
reversal of impairment on equipment. The South Carolina Flood charges of $1.5 million primarily relate to a total of $6.5 million of damaged inventory, clean-up and idle facility costs and impaired
property, plant and equipment, partially offset by Insurance Proceeds of $5.0 million.

Manufacturing facility closures, restructuring and other
related recoveries totalled $7.7 million for the fourth quarter of 2016, a $10.4 million improvement from $2.7 million in charges for the fourth quarter of 2015. The improvement was primarily due to Insurance Proceeds of
$9.3 million in the fourth quarter of 2016 as compared to $5.0 million in 2015, coupled with a reduction in charges associated with the South Carolina Flood in the fourth quarter of 2016.

Manufacturing facility closures, restructuring and other related recoveries improved $14.1 million from $6.3 million in charges for the third
quarter of 2016. The improvement was primarily due to the Insurance Proceeds of $9.3 million relating to the South Carolina Flood and a reduction in charges associated with the TaraTape Closure. The charges recorded in the third quarter of 2016
are primarily related to the TaraTape Closure impairments discussed above and site clean-up and idle facility costs related to the South Carolina Flood.

Finance Costs

Finance costs totalled $5.0 million
for the year ended December 31, 2016, a $1.8 million or 58.3% increase from $3.2 million for the year ended December 31, 2015. The increase was primarily due to an increase in interest expense in 2016 and lower foreign exchange
gains in 2016 compared to 2015. The interest expense increased due to a higher average amount of debt outstanding and a higher average cost of debt.

Finance costs totalled $3.2 million for the year ended December 31, 2015, a $3.0 million or 48.7% decrease from $6.2 million for the year
ended December 31, 2014. The decrease was primarily due to (i) foreign exchange gains in 2015, compared to foreign exchange losses in 2014 and (ii) a decrease in debt issue costs expensed in 2015 as a result of replacing the
Companys $200 million asset-based loan facility (ABL facility) with a new five-year $300 million revolving credit facility (Revolving Credit Facility) and the prepayment of certain other debt in 2014.

Finance costs for the fourth quarter of 2016 totalled $1.3 million, a $0.3 million or 18.7% decrease from $1.5 million for the fourth quarter
of 2015. The decrease was primarily due to foreign exchange gains in the fourth quarter of 2016, compared to foreign exchange losses in the fourth quarter of 2015. This decrease was partially offset by higher interest expense as a result of a higher
average amount of debt outstanding in the fourth quarter of 2016.

Finance costs decreased $0.2 million or 12.3% in the fourth quarter of 2016 from
$1.4 million for the third quarter of 2016. The decrease was primarily due to foreign exchange gains in the fourth quarter of 2016, compared to foreign exchange losses during the third quarter of 2016.



47



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##### Table of Contents

Income Taxes

The Company is subject to income taxation in multiple tax jurisdictions around the world. Accordingly, the Companys effective tax rate fluctuates
depending on the geographic source of its earnings. The Companys effective tax rate is also impacted by tax planning strategies that the Company implements. Income tax expense is recognized in each interim period based on the best estimate of
the weighted average annual income tax rate expected for the full financial year.

The table below reflects the calculation of the Companys
effective tax rate (in millions of US dollars):



|                                             |  |                                |      |   |                        |  |       |      |  |  |      |   |  |      |      |   |  |  |      |  
|-------------------------------------------- |  | ------------------------------ | ---- | - | ---------------------- |  | ----- | ---- |  |  | ---- | - |  | ---- | ---- | - |  |  | ---- | -
|                                             |  | Three months endedDecember 31, |      |   | Year endedDecember 31, | 
|                                             |  | 2016                           |      |   | 2015                   |  |       | 2016 |  |  | 2015 |   |  | 2014 |     
|                                             |  |                                | $    |   |                        |  | $     |      |  |  | $    |   |  |      | $    |   |  |  | $    |  
|Income tax expense (benefit)                 |  |                                | 9.7  |   |                        |  | (4.4  | )    |  |  | 19.6 |   |  |      | 11.0 |   |  |  | 22.9 |  
|Earnings before income tax expense (benefit) |  |                                | 31.4 |   |                        |  | 13.1  |      |  |  | 70.7 |   |  |      | 67.7 |   |  |  | 58.7 |  
|Effective tax rate                           |  |                                | 31.0 | % |                        |  | -34.0 | %    |  |  | 27.7 | % |  |      | 16.2 | % |  |  | 39.0 | %

The increase in the effective tax rate for 2016 compared to 2015 is primarily due to (i) the non-recurrence of the tax benefits recorded in 2015 to recognize previously derecognized Canadian deferred tax assets, (ii) the non-recurrence of the tax benefits
recorded in 2015 to decrease the deferred tax liability related to previously impaired property, plant and equipment, and (iii) an unfavourable change in the mix of earnings between jurisdictions. The decrease in the effective tax rate for 2015
compared to 2014 is primarily due to a favourable change in the mix of earnings between jurisdictions and the recognition of previously derecognized Canadian deferred tax assets.

As compared to the fourth quarter of 2015, the effective tax rate for the fourth quarter of 2016 increased primarily due to the
non-recurrence of the tax benefits recorded in the fourth quarter of 2015 to (i) recognize previously derecognized Canadian deferred tax assets and (ii) decrease the deferred tax liability related to
previously impaired property, plant and equipment.

IPG Net Earnings

IPG Net Earnings totalled $51.1 million for the year ended December 31 2016, a $5.6 million decrease from $56.7 million for the year ended
December 31, 2015. The decrease was primarily due to increases in SG&A and income tax expense, partially offset by an increase in gross profit. The Company estimates that its IPG Net Earnings for 2016 were positively impacted by the South
Carolina Flood by approximately $2.3 million as a result of Insurance Proceeds totalling $22.4 million offsetting the negative net earnings impact of the South Carolina Flood.

IPG Net Earnings totalled $56.7 million for the year ended December 31 2015, a $20.8 million increase from $35.8 million for the year
ended December 31, 2014. The increase was primarily due to the recognition of previously derecognized Canadian deferred tax assets, a decrease in finance costs, and an increase in gross profit. The Company estimates that its IPG Net Earnings
for 2015 were negatively impacted by the South Carolina Flood by approximately $2.8 million, net of the benefit from Insurance Proceeds totalling $5.0 million.

IPG Net Earnings for the fourth quarter of 2016 totalled $21.7 million, a $4.2 million increase from $17.5 million for the fourth quarter of
2015. The increase was primarily due to a decrease in manufacturing facility closure charges and an increase in gross profit, both of which were mainly due to South Carolina Flood Insurance Proceeds of $17.4 million in the fourth quarter 2016
as compared to $5.0 million recognized in the fourth quarter of 2015, partially offset by an increase in income tax expense.    The Company estimates that its IPG Net Earnings for the fourth quarter of 2016 were positively
impacted by the South Carolina Flood by approximately $9.2 million as a result of Insurance Proceeds offsetting the negative net earnings impact of the South Carolina Flood.



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##### Table of Contents

IPG Net Earnings for the fourth quarter of 2016 increased $15.4 million from $6.3 million for the third
quarter of 2016. The increase was primarily due to a decrease in manufacturing facility closure charges and an increase in gross profit, both of which were mainly due to South Carolina Flood Insurance Proceeds of $17.4 million, partially offset
by an increase in income tax expense mainly due to higher earnings.

Non-GAAP Financial Measures

This MD&A contains certain non-GAAP financial measures as defined under applicable securities legislation,
including EBITDA, adjusted EBITDA, adjusted net earnings (loss), adjusted earnings (loss) per share, leverage ratio and free cash flows (please see the Cash Flows section below for a description and reconciliation of free cash flows).
The Company believes such non-GAAP financial measures improve the period-to-period comparability of the Companys results by
providing more insight into the performance of ongoing core business operations. As required by applicable securities legislation, the Company has provided definitions of those measures and reconciliations of those measures to the most directly
comparable GAAP financial measures. Investors and other readers are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP financial measures to their most directly
comparable GAAP financial measures set forth below and should consider non-GAAP financial measures only as a supplement to, and not as a substitute for or as a superior measure to, measures of financial
performance prepared in accordance with GAAP.

Adjusted Net Earnings (Loss)

A reconciliation of the Companys adjusted net earnings (loss), a non-GAAP financial measure, to IPG Net Earnings,
the most directly comparable GAAP financial measure, is set out in the adjusted net earnings (loss) reconciliation table below. Adjusted net earnings (loss) should not be construed as IPG Net Earnings as determined by GAAP. The Company defines
adjusted net earnings (loss) as IPG Net Earnings before the controlling interest portion of (i) manufacturing facility closures, restructuring and other related charges (recoveries); (ii) share-based compensation expense (benefit); (iii)
impairment of goodwill; (iv) impairment (reversal of impairment) of long-lived assets and other assets; (v) write-down on assets classified as held-for-sale;
(vi) (gain) loss on disposal of property, plant and equipment; (vii) other discrete items as shown in the table below; and (viii) the income tax effect of these items. The term adjusted net earnings (loss) does not have any
standardized meaning prescribed by GAAP and is therefore unlikely to be comparable to similar measures presented by other issuers. Adjusted net earnings (loss) is not a measurement of financial performance under GAAP and should not be considered as
an alternative to IPG Net Earnings as an indicator of the Companys operating performance or any other measures of performance derived in accordance with GAAP. The Company has included this non-GAAP
financial measure because it believes that it allows investors to make a more meaningful comparison of the Companys performance between periods presented by excluding certain non-cash expenses and non-recurring expenses.

Adjusted earnings (loss) per share is also presented in the following table and is a non-GAAP financial measure. Adjusted earnings (loss) per share should not be construed as IPG Net Earnings per share as determined by GAAP. The Company defines adjusted earnings (loss) per share as adjusted net
earnings (loss) divided by the weighted average number of common shares outstanding, both basic and diluted. The term adjusted earnings (loss) per share does not have any standardized meaning prescribed by GAAP and is therefore unlikely
to be comparable to similar measures presented by other issuers. Adjusted earnings (loss) per share is not a measurement of financial performance under GAAP and should not be considered as an alternative to IPG Net Earnings per share as an indicator
of the Companys operating performance or any other measures of performance derived in accordance with GAAP. The Company has included this non-GAAP financial measure because it believes that it allows
investors to make a more meaningful comparison of the Companys performance between periods presented by excluding certain non-cash expenses and non-recurring
expenses.



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##### Table of Contents

Adjusted Net Earnings Reconciliation to IPG Net
Earnings(1)

(In millions of US dollars, except per share amounts and share numbers)

(Unaudited)



|                                                                                      |  |                                |            |   |                        |  |            |      |  |  |            |   |  |      |            |   |  |  |            |  
|------------------------------------------------------------------------------------- |  | ------------------------------ | ---------- | - | ---------------------- |  | ---------- | ---- |  |  | ---------- | - |  | ---- | ---------- | - |  |  | ---------- | -
|                                                                                      |  | Three months endedDecember 31, |            |   | Year endedDecember 31, | 
|                                                                                      |  | 2016                           |            |   | 2015                   |  |            | 2016 |  |  | 2015       |   |  | 2014 |           
|                                                                                      |  |                                | $          |   |                        |  | $          |      |  |  | $          |   |  |      | $          |   |  |  | $          |  
|IPG Net Earnings                                                                      |  |                                | 21.7       |   |                        |  | 17.5       |      |  |  | 51.1       |   |  |      | 56.7       |   |  |  | 35.8       |  
|Manufacturing facility closures, restructuring and other related charges (recoveries) |  |                                | (7.7       | ) |                        |  | 2.7        |      |  |  | 2.4        |   |  |      | 3.7        |   |  |  | 4.9        |  
|Share-based compensation expense                                                      |  |                                | 1.6        |   |                        |  | 2.3        |      |  |  | 8.2        |   |  |      | 3.2        |   |  |  | 6.2        |  
|Impairment (reversal of impairment) of long-lived assets and other assets             |  |                                | 0.1        |   |                        |  | (5.8       | )    |  |  | 0.2        |   |  |      | (5.8       | ) |  |  | 0.1        |  
|Loss (gain) on disposal of property, plant and equipment                              |  |                                | 0.0        |   |                        |  | 0.2        |      |  |  | 0.1        |   |  |      | (0.8       | ) |  |  | (0.1       | )
|Other Item: Litigation Settlement                                                     |  |                                |           |   |                        |  |           |      |  |  | 1.9        |   |  |      |           |   |  |  |           |  
|Other Item: Brantford Pension Charge
(2)                                              |  |                                |           |   |                        |  |           |      |  |  |           |   |  |      |           |   |  |  | 1.6        |  
|Income tax effect of these items                                                      |  |                                | 2.4        |   |                        |  | (0.2       | )    |  |  | (4.3       | ) |  |      | 0.6        |   |  |  | (3.8       | )
|                                                                                      |  |                                |            |   |                        |  |            |      |  |  |            |   |  |      |            |   |  |  |            |  
|Adjusted net earnings                                                                 |  |                                | 18.0       |   |                        |  | 16.7       |      |  |  | 59.7       |   |  |      | 57.6       |   |  |  | 44.8       |  
|                                                                                      |  |                                |            |   |                        |  |            |      |  |  |            |   |  |      |            |   |  |  |            |  
|IPG Net Earnings per share                                                            |  |                                |            |   |                        |  |            |      |  |  |            |   |  |      |            |   |  |  |            |  
|Basic                                                                                 |  |                                | 0.37       |   |                        |  | 0.30       |      |  |  | 0.87       |   |  |      | 0.95       |   |  |  | 0.59       |  
|Diluted                                                                               |  |                                | 0.36       |   |                        |  | 0.29       |      |  |  | 0.85       |   |  |      | 0.93       |   |  |  | 0.58       |  
|                                                                                      |  |                                |            |   |                       
|Adjusted earnings per share                                                           |  |                                |            |   |                        |  |            |      |  |  |            |   |  |      |            |   |  |  |            |  
|Basic                                                                                 |  |                                | 0.31       |   |                        |  | 0.28       |      |  |  | 1.02       |   |  |      | 0.96       |   |  |  | 0.74       |  
|Diluted                                                                               |  |                                | 0.30       |   |                        |  | 0.28       |      |  |  | 0.99       |   |  |      | 0.94       |   |  |  | 0.72       |  
|                                                                                      |  |                                |            |   |                       
|Weighted average number of common shares outstanding                                  |  |                                |            |   |                        |  |            |      |  |  |            |   |  |      |            |   |  |  |            |  
|Basic                                                                                 |  |                                | 58,899,366 |   |                        |  | 58,802,897 |      |  |  | 58,727,751 |   |  |      | 59,690,968 |   |  |  | 60,718,776 |  
|Diluted                                                                               |  |                                | 60,746,886 |   |                        |  | 60,316,201 |      |  |  | 60,369,227 |   |  |      | 61,110,633 |   |  |  | 62,060,923 |  



|(1) | As disclosed in the Companys press release on March 1, 2017, adjusted net earnings and adjusted earnings per share for the interim and annual periods in
fiscal 2014 and 2015, and the first three interim periods in fiscal 2016 were amended to correct a clerical error in the calculation of the income tax effect caption. For the purpose of a consistent presentation of all periods, certain prior period
amounts have been conformed to current period presentation.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The Brantford Pension Charge refers to a charge recorded in the third and fourth quarters of 2014 related to the settlement of the former Brantford,
Ontario manufacturing facility pension plan.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Adjusted net earnings totalled $59.7 million for the year ended December 31, 2016,
an $2.1 million increase from $57.6 million for the year ended December 31, 2015. The increase was primarily due to an increase in gross profit, partially offset by increases in income tax expense and SG&A. The Company estimates
that its adjusted net earnings for 2016 were negatively impacted by the South Carolina Flood by approximately $0.8 million net of the benefit from Insurance Proceeds.

Adjusted net earnings totalled $57.6 million for the year ended December 31, 2015, a $12.8 million increase from $44.8 million for the
year ended December 31, 2014. The increase was primarily due to the recognition of previously derecognized Canadian deferred tax assets and decreases in finance costs and variable compensation expenses, partially offset by a decrease in gross
profit, an increase in certain other SG&A expenses, and an increase in research expenses primarily associated with the South Carolina Project. The Company estimates that its adjusted net earnings for 2015 were negatively impacted by the South
Carolina Flood by approximately $1.8 million.



50



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##### Table of Contents

Adjusted net earnings totalled $18.0 million for the fourth quarter of 2016, a $1.3 million increase
from $16.7 million for the fourth quarter of 2015. The increase was primarily due to an increase in gross profit, partially offset by an increase in income tax expense. The Company estimates that its adjusted net earnings for the fourth quarter
of 2016 were positively impacted by the South Carolina Flood by approximately $3.7 million as a result of Insurance Proceeds offsetting the negative adjusted net earnings impact of the South Carolina Flood.

EBITDA, Adjusted EBITDA and Leverage Ratio

A
reconciliation of the Companys EBITDA, a non-GAAP financial measure, to net earnings, the most directly comparable GAAP financial measure, is set out in the EBITDA reconciliation table below. EBITDA
should not be construed as earnings (loss) before income taxes, net earnings or cash flows from operating activities as determined by GAAP. The Company defines EBITDA as net earnings before (i) interest and other finance costs; (ii) income
tax expense (benefit); (iii) amortization of intangible assets; and (iv) depreciation of property, plant and equipment. Adjusted EBITDA is defined as EBITDA before (i) manufacturing facility closures, restructuring and other related
charges (recoveries); (ii) share-based compensation expense (benefit); (iii) impairment of goodwill; (iv) impairment (reversal of impairment) of long-lived assets and other assets; (v) write-down on assets classified as held-for-sale; (vi) (gain) loss on disposal of property, plant and equipment; and (vii) other discrete items as shown in the table below. The terms EBITDA and
adjusted EBITDA do not have any standardized meanings prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other issuers. EBITDA and adjusted EBITDA are not measurements of financial performance
under GAAP and should not be considered as alternatives to cash flows from operating activities or as alternatives to net earnings as indicators of the Companys operating performance or any other measures of performance derived in accordance
with GAAP. The Company has included these non-GAAP financial measures because it believes that they allow investors to make a more meaningful comparison of the Companys performance between periods
presented by excluding certain non-operating expenses as well as certain non-cash expenses and non-recurring expenses. In
addition, EBITDA and adjusted EBITDA are used by management and the Companys lenders in evaluating the Companys performance because they believe that they allow management and the Companys lenders to make a more meaningful
comparison of the Companys performance between periods presented by excluding certain non-operating expenses as well as certain non-cash expenses and non-recurring expenses.

The Company defines leverage ratio as borrowings divided by adjusted EBITDA. The term
leverage ratio does not have any standardized meaning prescribed by GAAP and is therefore unlikely to be comparable to similar measures presented by other issuers. Leverage ratio is not a measurement of financial performance under GAAP
and should not be considered as an alternative to any GAAP measure as an indicator of the Companys liquidity level or any other measures of performance derived in accordance with GAAP. The Company has included this non-GAAP financial measure because it believes that it allows investors to make a meaningful comparison of the Companys liquidity level. In addition, leverage ratio is used by management in evaluating the
Companys performance because it believes that it allows management to monitor its liquidity level and evaluate its capacity to deploy capital to meet its strategic objectives.



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EBITDA and Adjusted EBITDA Reconciliation to Net Earnings

(In millions of US dollars)

(Unaudited)



|                                                                                      |  |                                |      |   |                         |  |      |      |  |  |       |  |  |      |       |   |  |  |       |  
|------------------------------------------------------------------------------------- |  | ------------------------------ | ---- | - | ----------------------- |  | ---- | ---- |  |  | ----- |  |  | ---- | ----- | - |  |  | ----- | -
|                                                                                      |  | Three months endedDecember 31, |      |   | Year ended December 31, | 
|                                                                                      |  | 2016                           |      |   | 2015                    |  |      | 2016 |  |  | 2015  |  |  | 2014 |      
|                                                                                      |  |                                | $    |   |                         |  | $    |      |  |  | $     |  |  |      | $     |   |  |  | $     |  
|Net earnings                                                                          |  |                                | 21.7 |   |                         |  | 17.5 |      |  |  | 51.1  |  |  |      | 56.7  |   |  |  | 35.8  |  
|Interest and other finance costs                                                      |  |                                | 1.3  |   |                         |  | 1.5  |      |  |  | 5.0   |  |  |      | 3.2   |   |  |  | 6.2   |  
|Income tax expense (benefit)                                                          |  |                                | 9.7  |   |                         |  | (4.4 | )    |  |  | 19.6  |  |  |      | 11.0  |   |  |  | 22.9  |  
|Depreciation and amortization                                                         |  |                                | 8.7  |   |                         |  | 10.6 |      |  |  | 31.0  |  |  |      | 30.9  |   |  |  | 26.2  |  
|                                                                                      |  |                                |      |   |                         |  |      |      |  |  |       |  |  |      |       |   |  |  |       |  
|EBITDA                                                                                |  |                                | 41.4 |   |                         |  | 25.2 |      |  |  | 106.7 |  |  |      | 101.7 |   |  |  | 91.1  |  
|Manufacturing facility closures, restructuring and other related charges (recoveries) |  |                                | (7.7 | ) |                         |  | 2.7  |      |  |  | 2.4   |  |  |      | 3.7   |   |  |  | 4.9   |  
|Share-based compensation expense                                                      |  |                                | 1.6  |   |                         |  | 2.3  |      |  |  | 8.2   |  |  |      | 3.2   |   |  |  | 6.2   |  
|Impairment (reversal of impairment) of long-lived assets and other assets             |  |                                | 0.1  |   |                         |  | (5.8 | )    |  |  | 0.2   |  |  |      | (5.8  | ) |  |  | 0.1   |  
|Loss (gain) on disposal of property, plant and equipment                              |  |                                | 0.0  |   |                         |  | 0.2  |      |  |  | 0.1   |  |  |      | (0.8  | ) |  |  | (0.1  | )
|Other Item: Litigation Settlement                                                     |  |                                |     |   |                         |  |     |      |  |  | 1.9   |  |  |      |      |   |  |  |      |  
|Other Item: Brantford Pension Charge                                                  |  |                                |     |   |                         |  |     |      |  |  |      |  |  |      |      |   |  |  | 1.6   |  
|                                                                                      |  |                                |      |   |                         |  |      |      |  |  |       |  |  |      |       |   |  |  |       |  
|Adjusted EBITDA                                                                       |  |                                | 35.3 |   |                         |  | 24.6 |      |  |  | 119.5 |  |  |      | 102.0 |   |  |  | 103.9 |  
|                                                                                      |  |                                |      |   |                         |  |      |      |  |  |       |  |  |      |       |   |  |  |       |  

Adjusted EBITDA totalled $119.5 million for the year ended December 31, 2016, a $17.5 million or 17.2% increase
from $102.0 million for the year ended December 31, 2015. The increase was primarily due to an increase in gross profit, partially offset by an increase in SG&A. The Company estimates that its adjusted EBITDA in 2016 was negatively
impacted by the South Carolina Flood by approximately $0.9 million net of the benefit from Insurance Proceeds.

Adjusted EBITDA totalled
$102.0 million for the year ended December 31, 2015, a $1.9 million or 1.8% decrease from $103.9 million for the year ended December 31, 2014. The decrease was primarily due to an unfavourable FX impact, an increase in
SG&A and an increase in research expenses. These negative impacts were partially offset by a decrease in variable compensation expense. The Company estimates that its adjusted EBITDA for 2015 was negatively impacted by the South Carolina Flood
by approximately $2.7 million.

Adjusted EBITDA totalled $35.3 million for the fourth quarter of 2016, a $10.7 million or 43.6% increase
from $24.6 million for the fourth quarter of 2015. The increase was primarily due to an increase in gross profit mainly due to Insurance Proceeds related to the South Carolina Flood in the fourth quarter of 2016. The Company estimates that its
adjusted EBITDA for the fourth quarter of 2016 was positively impacted by the South Carolina Flood by approximately $6.0 million as a result of Insurance Proceeds offsetting the negative adjusted EBITDA impact of the South Carolina Flood.

Comprehensive Income Attributable to Company Shareholders (IPG Comprehensive Income)

IPG Comprehensive Income is comprised of IPG Net Earnings and other comprehensive income (loss) attributable to Company shareholders. IPG Comprehensive Income
totalled $52.4 million for the year ended December 31, 2016, a $6.7 million or 14.6% increase from $45.7 million for the year ended December 31, 2015. The increase was primarily due to a favourable FX impact from cumulative
translation adjustments in 2016 compared to an unfavourable FX impact in 2015, partially offset by lower IPG Net Earnings in 2016.

IPG Comprehensive
Income totalled $45.7 million for the year ended December 31, 2015, a $22.2 million or 94.8% increase from $23.5 million for the year ended December 31, 2014. The increase was primarily due to higher IPG Net Earnings in 2015
and gains from the remeasurement of the defined benefit liability compared to actuarial losses in 2014.



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##### Table of Contents

Off-Balance Sheet Arrangements

Letters of Credit

The Company had standby letters of
credit issued and outstanding as of December 31, 2016 that could result in payments by the Company of up to an aggregate of $1.8 million upon the occurrence of certain events. All of the letters of credit have expiry dates in the first
half of 2017.

Capital Commitments

The Company had
commitments to suppliers to purchase machines and equipment totalling approximately $32.4 million as of December 31, 2016. It is expected that such amounts will be paid out in the next twelve months. In the event of cancellation, the
penalties that would apply may be equal to the purchase price depending on timing of the cancellation.

Raw Material Commitments

The Company obtains certain raw materials from suppliers under consignment agreements. The suppliers retain ownership of raw materials until the earlier of
when the materials are consumed in production or auto billings are triggered based upon maturity. The consignment agreements involve short-term commitments that typically mature within 30 to 60 days of inventory receipt and are typically renewed on
an ongoing basis. The Company may be subject to fees in the event the Company requires storage in excess of 30 to 60 days. As of December 31, 2016, the Company had on hand $8.7 million of raw material owned by its suppliers.

The Company has entered into agreements with various raw material suppliers to purchase minimum quantities of certain raw materials at fixed rates through
October 2017 totalling approximately $10.8 million as of December 31, 2016. The Company is also required by the agreements to pay any storage costs incurred by the applicable supplier in the event the Company delays shipment in excess of
30 days. In the event the Company defaults under the terms of an agreement, an arbitrator will determine fees and penalties due to the applicable supplier. Neither party will be liable for failure to perform for reasons of force majeure
as defined in the agreements.

Utilities Commitments

The Company entered into a five-year electricity service contract for one of its manufacturing facilities on May 1, 2016, under which the Company expects
to reduce the overall cost of electricity consumed by the facility. In the event of early termination, the Company is required to pay for unrecovered power supply costs incurred by the supplier which are estimated to be approximately
$11.7 million as of December 31, 2016 and would decline monthly based on actual service billings to date.

The Company entered into a ten-year electricity service contract for one of its manufacturing facilities on November 12, 2013. The service date of the contract commenced in August 2014. The Company is committed to monthly minimum usage
requirements over the term of the contract. The Company was provided installation at no cost and is receiving economic development incentive credits and maintenance of the required energy infrastructure at the manufacturing facility as part of the
contract. The credits are expected to reduce the overall cost of electricity consumed by the facility over the term of the contract. Effective August 1, 2015, the Company entered into an amendment lowering the minimum usage requirements over
the term of the contract. In addition, a new monthly facility charge will be incurred by the Company over the term of the contract. The Company estimates that service billings will total approximately $12.8 million over the remaining term of
the contract.



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Certain penalty clauses exist within the electricity service contract related to early cancellation after the
service date of the contract. The costs related to early cancellation penalties include termination fees based on anticipated service billings over the term of the contract and capital expense recovery charges. While the Company does not expect to
cancel the contract prior to the end of its term, the penalties that would apply to early cancellation could total as much as $4.8 million as of December 31, 2016. This amount declines annually until the expiration of the contract.

The Company has entered into agreements with various utility suppliers to fix certain energy costs, including natural gas and electricity, through December
2020 for minimum amounts of consumption at several of its manufacturing facilities. The Company estimates that utility billings will total approximately $5.1 million over the term of the contracts based on the contracted fixed terms and current
market rate assumptions. The Company is also required by the agreements to pay any difference between the fixed price agreed to with the utility and the sales amount received by the utility for resale to a third party if the Company fails to meet
the minimum consumption required by the agreements. In the event of early termination, the Company is required to pay the utility suppliers the difference between the contracted amount and the current market value of the energy, adjusted for present
value, of any future agreed upon minimum usage. Neither party will be liable for failure to perform for reasons of force majeure as defined in the agreements.

The Company currently knows of no event, trend or uncertainty that may affect the availability or benefits of these arrangements or that would trigger any
such penalty described above. The Company maintains no other off-balance sheet arrangements.

Related Party
Transactions

The Companys key personnel are all members of the Board of Directors and five members of senior management in 2016. Key personnel
remuneration includes: short-term benefits including base and variable compensation, deferred compensation, director retainer and committee fees, post-employment benefits, share-based compensation, and termination benefits. Total key personnel
remuneration included in the statement of consolidated earnings totalled $10.3 million for the year ended December 31, 2016, an increase of $4.9 million from $5.4 million for the year ended December 31, 2015. The increase
was primarily due to stock appreciation right (SAR) exercise activity and additional performance share unit (PSU) award grants in 2016 as well as an increase in variable compensation.

In June 2014, the Company engaged with a relocation management company to facilitate the purchase of the then-newly appointed CFOs home in Montreal,
Québec, Canada to assist in his relocation to Sarasota, FL, U.S.A. The Company provided funding to the relocation management company to purchase the home for $0.9 million. On April 15, 2015, the home was sold and the Company was
reimbursed for the purchase funding.

Working Capital

The Company experiences some business cyclicality that requires the management of working capital resources. Typically, a larger investment in working capital
is required in quarters when accounts receivable increase due to higher sales and when inventory increases due to higher anticipated future sales. Furthermore, certain liabilities are accrued for throughout the year and are paid only during the
first quarter of the following year.

The Company uses Days Inventory to measure inventory performance. Days Inventory for the fourth quarter of 2016
increased to 63 from 61 in the fourth quarter of 2015. Inventories totalled $103.5 million as of December 31, 2016, a $2.9 million increase from $100.6 million as of December 31, 2015. The increase was primarily due to an
increase in production to match sales volume growth as well as additional inventory resulting from the Powerband acquisition.

The Company uses Days Sales
Outstanding (DSO) to measure trade receivables. DSO increased to 39 in the fourth quarter of 2016 from 37 in the fourth quarter of 2015. Trade receivables totalled $90.1 million



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as of December 31, 2016, a $11.6 million increase from $78.5 million as of December 31, 2015. The increase was primarily due to an increase in the amount of revenue invoiced
in the fourth quarter of 2016 as compared to the fourth quarter of 2015.

The calculations are shown in the following tables:



Three months endedDec. 31,2016


Dec. 31,2015Cost of sales (1)

$
156.2


$
149.9Days in quarter


92



92Cost of sales per day (1)

$
1.70


$
1.63Average inventory (1)

$
107.1


$
99.4Days inventory


63



61 Days inventory is calculated as follows: Cost of sales ÷ Days in quarter = Cost of sales per day (Beginning inventory + Ending inventory) ÷ 2 = Average inventory Average inventory ÷ Cost of goods sold per day = Days inventory  (1)
In millions of US dollars


Three months endedDec. 31,2016


Dec. 31,2015Revenue (1)

$
209.9


$
195.7Days in quarter


92



92Revenue per day(1)

$
2.28


$
2.13Trade receivables (1)

$
90.1


$
78.5DSO


39



37 DSO is calculated as follows: Revenue ÷ Days in quarter = Revenue per day Ending
trade receivables ÷ Revenue per day = DSO






Accounts payable and accrued liabilities
totalled $100.2 million as of December 31, 2016, an increase of $18.0 million from $82.2 million as of December 31, 2015. The increase was primarily due to the timing of payments for inventory and SG&A.

Liquidity

The Company finances its operations through a
combination of cash flows from operating activities and borrowings under its Revolving Credit Facility. Liquidity risk management attempts to (i) maintain a sufficient amount of cash and (ii) ensure that the Company has financing sources
for a sufficient authorized amount. The Company establishes budgets, cash estimates and cash management policies with a goal of ensuring it has the necessary funds to fulfil its obligations for the foreseeable future.

The Company has access to a $300 million Revolving Credit Facility, plus an incremental accordion feature (that is available subject to the credit
agreements terms and lender approval) of $150 million through November 2019. As of December 31, 2016, the Company had drawn a total of $162.8 million, resulting in loan availability of $137.2 million. In addition, the
Company had $21.0 million of cash, yielding total cash and loan availability of $158.2 million as of December 31, 2016.

The Company
believes it has sufficient funds from cash flows from operating activities and cash on hand to meet its ongoing expected capital expenditures and working capital requirements funding needs for at least the next twelve months. These funds are also
sufficient to meet funding needs for discretionary dividend payments and common share repurchases. In addition, funds available under the Revolving Credit Facility may be used, as needed, to fund more significant strategic initiatives.

Also refer to the section below entitled Revolving Credit Facility for additional discussion of funds available under the Revolving Credit
Facility.



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##### Table of Contents

Cash Flows

The Companys net working capital on the balance sheets increased during 2016 and 2015 due to the effects of business acquisitions. However, working
capital amounts acquired are not included in cash flows from operating activities under IFRS. As such, the discussions below regarding 2016 and 2015 working capital items appropriately exclude these effects.

Cash flows from operating activities increased in the year ended December 31, 2016 by $5.9 million to $108.1 million from $102.3 million
in the year ended December 31, 2015, primarily due to higher operating profits, partially offset by an increase in accounts receivable largely due to an increase in the amount of revenue invoiced in the fourth quarter of 2016 compared to the
fourth quarter of 2015.

Cash flows from operating activities increased in the year ended December 31, 2015 by $15.4 million to
$102.3 million from $86.9 million in the year ended December 31, 2014, primarily due to a decrease in accounts receivable resulting from lower sales in the fourth quarter of 2015 compared to the fourth quarter of 2014 and an increase
in accounts receivable in 2014 compared to 2013.

Cash flows from operating activities increased in the fourth quarter of 2016 by $23.1 million to
$65.0 million from $41.9 million in the fourth quarter of 2015 primarily due to higher operating profit and accounts payable and accrued liabilities. The increase in accounts payable and accrued liabilities is primarily due to the timing
of payments near the end of 2016 compared to the end of 2015.

Additionally, the Companys working capital contained two significant fluctuations
that largely offset each other:



| |  |  | a decrease in inventory in the fourth quarter of 2016 compared to an increase in the fourth quarter of 2015 primarily due to the timing of raw material pre-buys and a higher
volume of sales in the fourth quarter of 2016 compared to the fourth quarter of 2015,
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | largely offset by a lower change in trade receivables in the fourth quarter of 2016 compared to the fourth quarter of 2015 primarily due to an increase in the amount of revenue invoiced in the fourth quarter for 2016
compared to 2015 and an increase in DSO to 39 in the fourth quarter of 2016 from 37 in the fourth quarter of 2015.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Cash flows used for
investing activities increased in the year ended December 31, 2016 by $32.6 million to $91.8 million from $59.2 million in the year ended December 31, 2015, primarily due to higher capital expenditures as well as the
Powerband acquisition in September 2016 for $41.9 million, compared to the 2015 Acquisitions of $26.2 million. The increase in capital expenditures primarily related to water-activated tape capacity expansion in Midland, North Carolina
(WAT Project) and other initiatives discussed in the section entitled Capital Resources below.

Cash flows used for investing
activities increased in the year ended December 31, 2015 by $22.4 million to $59.2 million from $36.8 million in the year ended December 31, 2014, primarily due to funding the 2015 Acquisitions, partially offset by lower
capital expenditures. The decrease in capital expenditures primarily related to the South Carolina Project, partially offset by capital expenditures for the WAT Project and shrink film capacity expansion at the Portugal manufacturing facility
(Portuguese Shrink Film Project) discussed in the section entitled Capital Resources below.

Cash flows used for investing
activities decreased in the fourth quarter of 2016 by $5.8 million to $14.0 million from $19.8 million in the fourth quarter of 2015, primarily due to funding the TaraTape acquisition in November 2015, partially offset by higher
capital expenditures in 2016 related to the WAT Project.

Cash flows used in financing activities decreased in the year ended December 31, 2016 by
$19.7 million to $11.5 million from $31.2 million in the year ended December 31, 2015, primarily due to a decrease in repurchases of common shares, partially offset by a decrease in net borrowings and an increase in dividends
paid.

Cash flows used in financing activities decreased in the year ended December 31, 2015 by $12.5 million to $31.2 million from
$43.7 million in the year ended December 31, 2014, primarily due to an increase in net borrowings, partially offset by an increase in repurchases of common shares and an increase in dividends paid.



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Cash flows used in financing activities increased in the fourth quarter of 2016 by $16.3 million to
$34.9 million from $18.6 million in the fourth quarter of 2015, primarily due to an increase in net repayments of debt in the fourth quarter of 2016, partially offset by a decrease in repurchases of common shares in the fourth quarter of
2016.

The Company is including free cash flows, a non-GAAP financial measure, because it is used by management
and investors in evaluating the Companys performance and liquidity. Free cash flows does not have any standardized meaning prescribed by GAAP and is therefore unlikely to be comparable to similar measures presented by other issuers. Free cash
flows should not be interpreted to represent residual cash flow available for discretionary purposes, as it excludes other mandatory expenditures such as debt service.

Free cash flows, defined by the Company as cash flows from operating activities less purchases of property, plant and equipment, decreased in the year ended
December 31, 2016 by $9.8 million to $58.2 million from $68.0 million in the year ended December 31, 2015 primarily due to an increase in capital expenditures.

Free cash flows increased in the year ended December 31, 2015 by $21.7 million to $68.0 million from $46.3 million in the year ended
December 31, 2014 primarily due to a decrease in accounts receivable and lower capital expenditures.

Free cash flows increased in the fourth quarter
of 2016 by $17.5 million to $50.8 million from $33.3 million in the fourth quarter of 2015, primarily due to an increase in operating profit and accounts payable and accrued liabilities.

A reconciliation of free cash flows to cash flows from operating activities, the most directly comparable GAAP financial measure, is set forth below.

Free Cash Flows Reconciliation

(In millions of US
dollars)

(Unaudited)



|                                                |  |                                |       |   |                        |  |      |      |  |  |       |   |  |      |       |   |  |  |       |  
|----------------------------------------------- |  | ------------------------------ | ----- | - | ---------------------- |  | ---- | ---- |  |  | ----- | - |  | ---- | ----- | - |  |  | ----- | -
|                                                |  | Three months endedDecember 31, |       |   | Year endedDecember 31, | 
|                                                |  | 2016                           |       |   | 2015                   |  |      | 2016 |  |  | 2015  |   |  | 2014 |      
|                                                |  |                                | $     |   |                        |  | $    |      |  |  | $     |   |  |      | $     |   |  |  | $     |  
|Cash flows from operating activities            |  |                                | 65.0  |   |                        |  | 41.9 |      |  |  | 108.1 |   |  |      | 102.3 |   |  |  | 86.9  |  
|Less purchases of property, plant and equipment |  |                                | (14.2 | ) |                        |  | (8.5 | )    |  |  | (50.0 | ) |  |      | (34.3 | ) |  |  | (40.6 | )
|                                                |  |                                |       |   |                        |  |      |      |  |  |       |   |  |      |       |   |  |  |       |  
|Free cash flows                                 |  |                                | 50.8  |   |                        |  | 33.3 |      |  |  | 58.2  |   |  |      | 68.0  |   |  |  | 46.3  |  
|                                                |  |                                |       |   |                        |  |      |      |  |  |       |   |  |      |       |   |  |  |       |  

Revolving Credit Facility

The Companys $300 million Revolving Credit Facility is with a syndicate of financial institutions and replaced the Companys $200 million
ABL facility in November 2014. The Company relies upon cash flows from operating activities and funds available under the Revolving Credit Facility to meet working capital requirements as well as to fund capital expenditures, mergers and
acquisitions, dividends, share repurchases, obligations under its other debt instruments, and other general corporate purposes. The Revolving Credit Facility also includes an incremental accordion feature of $150 million, which will enable the
Company to increase the limit of this facility (subject to the credit agreements terms and lender approval) if needed.



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As of December 31, 2016, the Company had drawn a total of $162.8 million against the Revolving Credit
Facility, which consisted of $161.0 million of borrowings and $1.8 million of standby letters of credit. The Company had total cash and loan availability of $158.2 million as of December 31, 2016 and $182.3 million as of
December 31, 2015. The change in total cash and loan availability is due to the changes in cash flows as previously discussed.

The Revolving Credit
Facility is priced primarily on the LIBOR rate plus a spread varying between 100 and 225 basis points (150 basis points as of December 31, 2016 and 2015). The spread depends on the consolidated total leverage ratio (as defined under the
Revolving Credit Facility) and increases as the consolidated total leverage ratio increases. The revolving credit loans denominated in US Dollars bear interest at the LIBOR rate applicable to dollar-denominated loans plus the applicable spread.
Revolving credit loans denominated in an alternative currency bear interest at the floating rate applicable to alternative currency-denominated loans plus the applicable spread and any mandatory costs. As of December 31, 2016, the full
$161.0 million of borrowings was priced at 30-day US dollar LIBOR.

As of December 31, 2016, the
Revolving Credit Facility has, in summary, three financial covenants: (i) a consolidated total leverage ratio not to be greater than 3.25 to 1.00, with an allowable temporary increase to 3.75 to 1.00 for the four quarters following an
acquisition with a price not less than $50 million, (ii) a consolidated debt service ratio not to be less than 1.50 to 1.00, and (iii) the aggregated amount of all capital expenditures in any fiscal year may not exceed
$50 million (as discussed in the next paragraph this covenant was amended in January 2017.) Also as of December 31, 2016 (and before the January 2017 amendments discussed in the next paragraph), any portion of the allowable
$50 million not expended in the year may be carried over for expenditure in the following year but not carried over to any additional subsequent year thereafter (as such, the allowable capital expenditures were $65.7 million in 2016 and
$59.4 million in 2015 due to a carry forward provision of unused capital expenditure amounts from the prior year). The Company was in compliance with all three financial covenants which were 1.53, 7.34 and $49.9 million, respectively, as
of December 31, 2016.

In January 2017 the Companys Revolving Credit Facility was in part amended to increase the limit of allowable capital
expenditures in any fiscal year from 2017 onwards to $100 million and amounts not expended in the year are no longer able to be carried over to the next year.

Capital Resources

Capital expenditures totalled
$14.2 million and $50.0 million in the three months and year ended December 31, 2016, respectively, as funded by the Revolving Credit Facility and cash flows from operating activities. Capital expenditures for the year ended
December 31, 2016 and those currently expected to be made in 2017 are primarily for property, plant and equipment to support the following strategic and growth initiatives: the WAT Project, the Portuguese Shrink Film Project, expansion of the
Companys specialty tape product offering (Specialty Tape Project), technology upgrade and capacity expansion of stretch film production in the Danville, Virginia manufacturing facility (Stretch Film Project), shrink
film capacity expansion at the Tremonton, Utah manufacturing facility (Utah Shrink Film Project), the Powerband Investment Projects and various other initiatives and maintenance needs. All of the strategic and growth initiatives are
currently expected to yield an after-tax internal rate of return greater than 15%.



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The table below summarizes the capital expenditures to date and expected future capital expenditures for the
above mentioned initiatives (in millions of US dollars):



|                                  |  |                        |      |  |                                               |  |       |               |  |  |                 |  |  |  |             | 
|--------------------------------- |  | ---------------------- | ---- |  | --------------------------------------------- |  | ----- | ------------- |  |  | --------------- |  |  |  | ----------- | 
|                                  |  | Year endedDecember 31, |      |  | Approximate amountsbased on current estimates | 
|                                  |  | 2016                   |      |  | 2017                                          |  |       | Total Project |  |  | Completion Date | 
|                                  |  |                        | $    |  |                                               |  | $     |               |  |  | $               |  |  |  |             | 
|WAT Project                       |  |                        | 13.7 |  |                                               |  | 26-31 |               |  |  | 44-49           |  |  |  | End of 2017 | 
|Portuguese Shrink Film Project(1) |  |                        | 5.4  |  |                                               |  | 1-2   |               |  |  | 11              |  |  |  | Mid-2017    | 
|Specialty Tape Project            |  |                        | 2.7  |  |                                               |  | 2-4   |               |  |  | 10              |  |  |  | End of 2017 | 
|Powerband Investment Projects (1) |  |                        | 1.5  |  |                                               |  | 10-14 |               |  |  | 20              |  |  |  | Mid-2018    | 
|Stretch Film Project              |  |                        | 1.4  |  |                                               |  | 8-10  |               |  |  | 11              |  |  |  | Mid-2018    | 
|Utah Shrink Film Project          |  |                        |     |  |                                               |  | 7-9   |               |  |  | 9               |  |  |  | Mid-2018    | 



|(1) | Subject to FX impact and excluding any government subsidies.
|--- | ------------------------------------------------------------

Capital expenditures to support maintenance
needs are expected to be between $10 and $12 million in 2017.

In addition, the Company had commitments to suppliers to purchase machines and
equipment totalling approximately $32.4 million as of December 31, 2016, primarily to support the initiatives discussed above. It is expected that such amounts will be paid out in the next twelve months and will be funded by the Revolving
Credit Facility and cash flows from operating activities.

Contractual Obligations

The Companys principal contractual obligations and commercial commitments as of December 31, 2016 are summarized in the following table (in millions
of USD):



|                                                                         |  |                            |       |  |                |  |      |          |  |  |          |  |  |              |      |  |  |  |      | 
|------------------------------------------------------------------------ |  | -------------------------- | ----- |  | -------------- |  | ---- | -------- |  |  | -------- |  |  | ------------ | ---- |  |  |  | ---- | 
|                                                                         |  | Payments Due by Period (1) |      
|                                                                         |  | Total                      |       |  | Lessthan1 year |  |      | 1-3years |  |  | 4-5years |  |  | After5 years |     
|                                                                         |  |                            | $     |  |                |  | $    |          |  |  | $        |  |  |              | $    |  |  |  | $    | 
|Debt principal obligations (2)                                           |  |                            | 167.1 |  |                |  | 1.1  |          |  |  | 162.8    |  |  |              | 1.6  |  |  |  | 1.6  | 
|Finance lease obligations (3)                                            |  |                            | 15.3  |  |                |  | 6.1  |          |  |  | 5.8      |  |  |              | 0.8  |  |  |  | 2.6  | 
|Pensions, post-retirement and other long-term employee benefit plans (4) |  |                            | 8.0   |  |                |  | 7.8  |          |  |  | 0.0      |  |  |              | 0.1  |  |  |  | 0.0  | 
|Operating lease obligations                                              |  |                            | 13.3  |  |                |  | 4.0  |          |  |  | 5.2      |  |  |              | 2.1  |  |  |  | 2.0  | 
|Equipment purchase commitments                                           |  |                            | 32.4  |  |                |  | 32.4 |          |  |  |         |  |  |              |     |  |  |  |     | 
|Utilities contract obligations (5)                                       |  |                            | 29.6  |  |                |  | 6.4  |          |  |  | 11.4     |  |  |              | 7.4  |  |  |  | 4.4  | 
|Raw material purchase commitments
(6)                                    |  |                            | 19.5  |  |                |  | 19.5 |          |  |  |         |  |  |              |     |  |  |  |     | 
|Other obligations (7)                                                    |  |                            | 7.7   |  |                |  | 5.7  |          |  |  | 1.0      |  |  |              | 0.1  |  |  |  | 0.9  | 
|                                                                         |  |                            |       |  |                |  |      |          |  |  |          |  |  |              |      |  |  |  |      | 
|Total                                                                    |  |                            | 292.9 |  |                |  | 83.0 |          |  |  | 186.2    |  |  |              | 12.1 |  |  |  | 11.5 | 
|                                                                         |  |                            |       |  |                |  |      |          |  |  |          |  |  |              |      |  |  |  |      | 



|(1) | Less than 1 year represents those payments due in 2017, 1-3 years represents those payments due in
2018 and 2019, 3-5 years represents those payments due in 2020 and 2021, while After 5 years includes those payments due in later years.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Refer to the previous section entitled Revolving Credit Facility for discussion of related interest obligations.
|--- | ------------------------------------------------------------------------------------------------------------------

|(3) | The figures in the table above include interest expense included in minimum lease payments of $1.0 million.
|--- | -----------------------------------------------------------------------------------------------------------



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|(4) | Pension, post-retirement and other long-term employee benefit plans includes contributions associated with defined benefit and defined contribution plans as well as
obligations under the deferred compensation plan. Defined benefit plan contributions represent the amount the Company expects to contribute in 2017. Defined benefit plan contributions beyond 2017 are not determinable since the amount of any
contributions is heavily dependent on the future economic environment and investment returns on pension plan assets. Volatility in the global financial markets could have an unfavourable impact on the Companys future pension and other
post-retirement benefits funding obligations as well as net periodic benefit cost.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Defined contribution plan contributions
represent the obligation recorded as of December 31, 2016 to be paid in 2017. Certain defined contribution plan contributions beyond 2017 are not determinable since contribution to the plan is at the discretion of the Company.

Refer to Note 18 in the Companys Financial Statements for a complete discussion of pension, post-retirement and other long-term employee
benefit plans.



|(5) | Utilities contract obligations include agreements with various utility suppliers to fix certain energy costs, including natural gas and electricity, for minimum
amounts of consumption at several of the Companys manufacturing facilities, as discussed in the previous section entitled Off-Balance Sheet Arrangements above. The figures included in the
table above are estimates of utility billings over the term of the contracts based on the contracted fixed terms and current market rate assumptions. The Company currently knows of no event, trend or uncertainty that may affect the availability or
benefits of the agreements.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(6) | Raw material purchase commitments include certain raw materials from suppliers under consignment agreements, as discussed in the previous section entitled Off-Balance Sheet Arrangements above. The figures included in the table above represent raw material inventory on hand or in transit, owned by the Companys suppliers, that the Company expects to
consume.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Raw material purchase commitments also include agreements with various raw material suppliers to purchase minimum
quantities of certain raw materials at fixed rates, as discussed in the previous section entitled Off-Balance Sheet Arrangements above. The figures included in the table above do not include
estimates for storage costs, fees or penalties. The Company currently knows of no event, trend or uncertainty that may affect the availability or benefits of these agreements.



|(7) | Other obligations include provisions for (i) environmental obligations primarily related to the South Carolina Project, (ii) restoration obligations
associated with leased facilities, and (iii) termination benefits primarily related to the TaraTape Closure and the South Carolina Project. Refer to Note 14 in the Companys Financial Statements for a complete discussion of provisions and
contingent liabilities. Also included in other obligations are standby letters of credit discussed above in the section entitled Revolving Credit Facility.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Purchase orders outside the scope of the raw material purchase commitments as defined in this section are not included in the table above. The Company is not
able to determine the aggregate amount of such purchase orders that represent contractual obligations, as these purchase orders typically represent authorizations to purchase rather than binding agreements. For the purposes of this table,
contractual obligations for purchase of goods or services are defined as agreements that are enforceable and legally binding on the Company and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed,
minimum or variable price provisions; and the approximate timing of the transaction. The Companys purchase orders are based on current demand expectations and are fulfilled by the Companys vendors within short time horizons. The Company
also enters into contracts for outsourced services; however, the obligations under these contracts are not significant and the contracts generally contain clauses allowing for cancellation without significant penalty.



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Stock Appreciation Rights

The amount and timing of a potential cash payment to settle a SAR is not determinable since the decision to exercise is not within the Companys control
after the award vests and is not included in the table above. On June 20, 2012, the Board of Directors of the Company adopted the 2012 Stock Appreciation Rights Plan (SAR Plan). A SAR, as defined by the SAR Plan, is a right to
receive a cash payment equal to the difference between the base price of the SAR and the market value of a common share of the Company on the date of exercise. These SARs can be settled only in cash and expire no later than 10 years after the date
of the grant.

On June 28, 2012, 1,240,905 SARs were granted at a base price of CDN$7.56 with contractual lives ranging from six to ten years.

As of December 31, 2016, the aggregate intrinsic value of outstanding vested awards was $2.1 million. As of December 31, 2016,
$0.5 million was accrued to settle SAR awards exercised but not yet paid.

Capital Stock and Dividends

As of December 31, 2016, there were 59,060,335 common shares of the Company outstanding.

During the year ended December 31, 2016, cash dividends were paid as follows:



|                  |  |                    |  |                       |      |  |                         |                    |                                      |            |                  |   |     | 
|----------------- |  | ------------------ |  | --------------------- | ---- |  | ----------------------- | ------------------ | ------------------------------------ | ---------- | ---------------- | - | --- | 
|Declared Date     |  | Paid date          |  | Per commonshareamount |      |  | Shareholder
record date |                    | Common
shares issued and
outstanding |            | Aggregatepayment |  
|March 9, 2016     |  | March 31, 2016     |  | $                     | 0.13 |  |                         | March 21, 2016     |                                      | 58,522,835 |                  | $ | 7.5 | 
|May 9, 2016       |  | June 30, 2016      |  | $                     | 0.13 |  |                         | June 15, 2016      |                                      | 58,602,835 |                  | $ | 7.6 | 
|August 10, 2016   |  | September 30, 2016 |  | $                     | 0.14 |  |                         | September 15, 2016 |                                      | 58,621,585 |                  | $ | 8.2 | 
|November 10, 2016 |  | December 30, 2016  |  | $                     | 0.14 |  |                         | December 15, 2016  |                                      | 59,060,335 |                  | $ | 8.0 | 

On March 8, 2017, the Board of Directors declared a dividend of $0.14 per common share payable on March 31, 2017 to
shareholders of record at the close of business on March 21, 2017.

Since the dividend policy was reinstated in August 2012, the Company has paid
$104.6 million in cumulative dividends, of which $31.4 million was paid in 2016.

The dividends paid in 2016 and payable in 2017 by the Company
are eligible dividends as defined in subsection 89(1) of the Income Tax Act (Canada).

The Company entered into an NCIB to repurchase
for cancellation up to 2,000,000 common shares effective on July 10, 2014. The NCIB was subsequently renewed July 10, 2015 and amended November 11, 2015, to increase the total shares available for repurchase to 4,000,000 common
shares. This NCIB, which was scheduled to expire on July 9, 2016, was renewed for a twelve-month period starting July 14, 2016. This renewed NCIB expires on July 13, 2017. As of December 31, 2016 and March 8, 2017, 4,000,000
shares remained available for repurchase under the NCIB.



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The table below summarizes the NCIB activity that occurred during the three months and year ended December 31:



|                                                     |  |                                |   |  |                        |      |         |      |  |      |         |  |  |      |           | 
|---------------------------------------------------- |  | ------------------------------ | - |  | ---------------------- | ---- | ------- | ---- |  | ---- | ------- |  |  | ---- | --------- | 
|                                                     |  | Three months endedDecember 31, |   |  | Year endedDecember 31, |     
|                                                     |  | 2016                           |   |  | 2015                   |      |         | 2016 |  |      | 2015    | 
|Common shares repurchased                            |  |                                |  |  |                        |      | 366,600 |      |  |      | 147,200 |  |  |      | 2,487,188 | 
|Average price per common share including commissions |  |                                |  |  |                        | CDN$ | 14.28   |      |  | CDN$ | 15.77   |  |  | CDN$ | 15.52     | 
|Total purchase price including commissions(1)        |  |                                |  |  |                        | $    | 4.0     |      |  | $    | 1.7     |  |  | $    | 30.0      | 



|(1) | In millions of US dollars
|--- | -------------------------

On April 22, 2014, the Board of Directors adopted the PSU Plan. A PSU, as
defined by the PSU Plan, represents the right of a participant, once such PSU is earned and has vested in accordance with the PSU Plan, to receive (prior to the amendments discussed below) the number of common shares of the Company underlying the
PSU. On May 9, 2016, the Board of Directors approved an amendment to the PSU Plan to provide the Company the option of settling PSUs in cash. The Board has full discretion to determine the form of settlement of the PSUs and as of
December 31, 2016, no such discretion had been used. Additionally, on the same date, the Board of Directors approved an amendment to the PSU Plan that allowed for accelerated vesting of PSUs in the event of death, disability or retirement of a
participant.

The PSUs are normally earned over a three-year period with vesting at the third anniversary of the grant date unless vesting is accelerated
based on retirement eligibility, death or disability. The number of shares earned can range from 0% to 150% of the grant amount based on the total shareholder return (TSR) ranking versus a specified peer group of companies. As of
December 31, 2016, the Companys TSR ranking was such that if all PSUs outstanding were to be settled as of December 31, 2016, the number of shares earned would be 150% of the grants awarded.

On April 22, 2014, the Board of Directors adopted the DSU Plan. A deferred share unit (DSU), as defined by the DSU Plan, represents the right
of a participant to receive (prior to the amendments discussed below) a common share of the Company. Under the DSU Plan, a non-executive director is entitled to receive DSUs as a result of a grant and/or in
lieu of cash for semi-annual directors fees. DSUs are settled when the director ceases to be a member of the Board of Directors of the Company. DSUs are net-settled to satisfy minimum statutory tax
withholding requirements.

The table below summarizes equity-settled share-based compensation activity that occurred during the three months and year
ended December 31:



|                                          |  |                                |         |  |                        |   |         |      |  |   |         |  |  |      |         |  |  |   |         | 
|----------------------------------------- |  | ------------------------------ | ------- |  | ---------------------- | - | ------- | ---- |  | - | ------- |  |  | ---- | ------- |  |  | - | ------- | 
|                                          |  | Three months endedDecember 31, |         |  | Year endedDecember 31, |  
|                                          |  | 2016                           |         |  | 2015                   |   |         | 2016 |  |   | 2015    |  |  | 2014 |        
|Stock options granted                     |  |                                |        |  |                        |   |        |      |  |   |        |  |  |      |        |  |  |   | 492,500 | 
|Stock options exercised                   |  |                                | 415,000 |  |                        |   | 116,250 |      |  |   | 540,000 |  |  |      | 712,500 |  |  |   | 256,677 | 
|Cash proceeds (in millions of US dollars) |  | $                              | 0.7     |  |                        | $ | 0.3     |      |  | $ | 1.5     |  |  | $    | 1.6     |  |  | $ | 0.8     | 
|Stock options expired or forfeited        |  |                                |        |  |                        |   | 27,500  |      |  |   | 16,250  |  |  |      | 30,000  |  |  |   | 140,000 | 
|PSUs granted                              |  |                                | 30,161  |  |                        |   |        |      |  |   | 422,733 |  |  |      | 363,600 |  |  |   | 152,500 | 
|PSUs forfeited                            |  |                                |        |  |                        |   | 16,290  |      |  |   | 28,696  |  |  |      | 18,060  |  |  |   |        | 
|DSUs granted                              |  |                                |        |  |                        |   |        |      |  |   | 52,665  |  |  |      | 46,142  |  |  |   | 36,901  | 
|Shares issued upon DSU settlement         |  |                                |        |  |                        |   |        |      |  |   |        |  |  |      | 6,397   |  |  |   |        | 

On February 17, 2017, the Board of Directors approved an amendment to the PSU Plan and to the DSU Plan to provide for
only cash settlement of PSU and DSU awards, respectively. As a result of the amendment, prospectively and until award settlement, the Company will remeasure the fair value of the awards on amendment date and at each reporting period end date, and
present the cash-settled awards as a liability within other liabilities and not in contributed surplus in the consolidated balance sheets. Changes in the fair value of the liability will be reflected in SG&A in the statement of consolidated
earnings.



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Pension and Other Post-Retirement Benefit Plans

The Companys pension and other post-retirement benefit plans currently have an unfunded deficit of $30.8 million as of December 31, 2016 as
compared to $29.3 million as of December 31, 2015. The increase was primarily due to a decrease in the weighted average discount rate from 4.01% and 4.25% for US and Canadian plans, respectively, as of December 31, 2015 to 3.87% and
4.00% for US and Canadian plans, respectively, as of December 31, 2016. These changes resulted in an increase in net present value of the liability and are partially offset by an increase in the fair value of plan assets. For 2016, the Company
contributed $1.4 million as compared to $2.0 million in 2015, to its funded pension plans and to beneficiaries for its unfunded benefit plans. Adverse market conditions could require the Company to make additional cash payments to fund the
plans which could reduce cash available for other business needs; however, the Company expects to meet its minimum required pension benefit plan funding obligations for 2017. None of the defined benefit plan assets were invested in any of the
Companys own equity or financial instruments or in any property or other assets used by the Company.

Effective September 30, 2011, the defined
benefit plan sponsored by the Company, associated with the former Brantford, Ontario manufacturing facility, was wound-up. Pursuant to applicable legislation, benefits for this plan had to be settled within
the five-year period following the wind-up effective date. During the year ended December 31, 2014, the Company purchased group annuity buy out policies to settle its obligation to plan participants
resulting in non-cash settlement losses of $1.6 million representing the difference between the accounting liability and the cost to settle the obligations. The settlement losses were included in the
statement of consolidated earnings under the caption cost of sales.

Financial Risk, Objectives and Policies

The Company is exposed to a risk of change in cash flows due to the fluctuations in interest rates applicable on its variable rate Revolving Credit Facility
and other floating rate debt. To hedge the long-term cost of floating rate debt, the Company entered into interest rate swap agreements that are designated as cash flow hedges.

The terms of the interest swap agreements are as follows (in millions of US dollars):



|                |  |                   |  |                 |  |            |  |                          |       | 
|--------------- |  | ----------------- |  | --------------- |  | ---------- |  | ------------------------ | ----- | 
|Effective Date  |  | Maturity          |  | Notional amount |  | Settlement |  | Fixed interest rate paid |      
|                |  |                   |  | $               |  |            |  |                          | %     | 
|March 18, 2015  |  | November 18, 2019 |  | 40.0            |  | Monthly    |  |                          | 1.610 | 
|August 18, 2015 |  | August 20, 2018   |  | 60.0            |  | Monthly    |  |                          | 1.197 | 

Please refer to Note 22 of the Companys Financial Statements for a complete discussion of the Companys risk
factors, risk management, objectives and policies.

Litigation

On November 5, 2015, the Companys former CFO filed a lawsuit against the Company in the United States District Court for the Middle District of
Florida alleging certain violations by the Company related to the terms of his employment and his termination. On October 20, 2016, the Company and the former CFO agreed to the Litigation Settlement. Pursuant to the terms of the confidential
settlement agreement, the Company paid $1.9 million in October 2016 for full and complete settlement of all matters between the parties with respect to the litigation.

The Company is engaged from time-to-time in various legal proceedings and
claims that have arisen in the ordinary course of business. The outcome of all of the proceedings and claims against the Company is subject to future resolution, including the uncertainties of litigation. Based on information currently known to the
Company and after consultation with outside legal counsel, management believes that the probable ultimate resolution of any such proceedings and claims, individually or in the aggregate, will not have a material adverse effect on the financial
condition of the Company, taken as a whole, and accordingly, no material amounts have been recorded as of December 31, 2016 with the exception of the item discussed in the paragraph above.



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Critical Accounting Judgments, Estimates and Assumptions

The preparation of the Companys Financial Statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect
the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Significant changes in the underlying assumptions could result in significant changes to these estimates. Consequently, management reviews
these estimates on a regular basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Information about these significant judgments, assumptions and estimates that
have the most significant effect on the recognition and measurement of assets, liabilities, income and expenses are summarized below:

Significant
Management Judgment

Deferred income taxes

Deferred tax assets are recognized for unused tax losses and tax credits to the extent that it is probable that future taxable income will be available against
which the losses can be utilized. These estimates are reviewed at every reporting date. Significant management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of
the reversal of existing timing differences, future taxable income and future tax planning strategies. Refer to Note 5 of the Companys Financial Statements for more information regarding income taxes.

Estimation Uncertainty

Impairments

At the end of each reporting period the Company performs a test of impairment on assets subject to amortization if there are indicators of impairment. Goodwill
allocated to cash generating units (CGU) and intangible assets with indefinite useful lives are tested annually. An impairment loss is recognized when the carrying value of an asset or CGU exceeds its recoverable amount, which in turn is
the higher of its fair value less costs to sell and its value in use. The value in use is based on discounted estimated future cash flows. The cash flows are derived from the budget or forecasts for the estimated remaining useful lives of the CGUs
and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the performance of the asset or CGU being tested. The value in use will vary depending on the discount rate
applied to the discounted cash flows, the estimated future cash inflows, and the growth rate used for extrapolation purposes.

Refer to Note 12 of the
Companys Financial Statements for more information regarding impairment testing.

Pension, post-retirement and other long-term employee benefits

The cost of defined benefit pension plans and other post-retirement benefit plans and the present value of the related obligations are determined
using actuarial valuations. The determination of benefits expense and related obligations requires assumptions such as the discount rate to measure obligations, expected mortality and the expected healthcare cost trend. Actual results will differ
from estimated results which are based on assumptions. Refer to Note 18 of the Companys Financial Statements for more information regarding the assumptions related to the pension and other post-retirement benefit plans.



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Uncertain tax positions

The Company is subject to taxation in numerous jurisdictions. There are many transactions and calculations during the course of business for which the ultimate
tax determination is uncertain. The Company maintains provisions for uncertain tax positions that it believes appropriately reflect its risk. These provisions are made using the best estimate of the amount expected to be paid based on a qualitative
assessment of all relevant factors. The Company reviews the adequacy of these provisions at the end of the reporting period. However, it is possible that at some future date, liabilities in excess of the Companys provisions could result from
audits by, or litigation with, the relevant taxing authorities. Refer to Note 5 of the Companys Financial Statements for more information regarding income taxes.

Useful lives of depreciable assets

Management reviews
the useful lives, depreciation methods and residual values of depreciable assets at each reporting date. As of the reporting date, management assesses the useful lives which represent the expected utility of the assets to the Company. Actual
results, however, may vary due to technical or commercial obsolescence, particularly with respect to information technology and manufacturing equipment.

Net realizable value of inventories and parts and supplies

Inventories and parts and supplies are measured at the lower of cost or net realizable value. In estimating net realizable values of inventories and parts and
supplies, management takes into account the most reliable evidence available at the time the estimate is made.

Provisions for slow-moving and obsolete
inventories are made based on the age and estimated net realizable value of inventories. The assessment of the provision involves management judgment and estimates associated with expected disposition of the inventory. Refer to Note 7 of the
Companys Financial Statements for information regarding inventories and write-downs of inventories.

Allowance for doubtful accounts and revenue
adjustments

During each reporting period, the Company makes an assessment of whether trade accounts receivable are collectible from customers.
Accordingly, management establishes an allowance for estimated losses arising from non-payment and other revenue adjustments, taking into consideration customer creditworthiness, current economic trends, past
experience and credit insurance coverage. The Company also records reductions to revenue for estimated returns, claims, customer rebates, and other incentives that are estimated based on historical experience, practices and current economic trends.
If future collections and trends differ from estimates, future earnings will be affected. Refer to Note 22 of the Companys Financial Statements for more information regarding the allowance for doubtful accounts and the related credit risks.

Provisions

Provisions are recognized when the
Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period,
taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows, when the effect
of the time value of money is material.

Provisions of the Company include environmental and restoration obligations, litigation and termination benefits
and other provisions. Refer to Note 14 of the Companys Financial Statements for more information regarding provisions.



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Share-based payments

The estimation of share-based payment fair value and expense requires the selection of an appropriate pricing model.

The model used by the Company for the Executive Stock Option Plan (ESOP) and SAR Plan is the Black-Scholes pricing model. The Black-Scholes model
requires the Company to make significant judgments regarding the assumptions used within the model, the most significant of which are the expected volatility of the Companys own common shares, the probable life of awards granted, the time of
exercise, the risk-free interest rate commensurate with the term of the awards, and the expected dividend yield.

The model used by the Company for the
PSU Plan is the Monte Carlo simulation model. The Monte Carlo model requires the Company to make significant judgments regarding the assumptions used within the model, the most significant of which are the volatility of the Companys own common
shares as well as those of a peer group, the performance measurement period, and the risk-free interest rate commensurate with the term of the awards.

Refer to Note 16 of the Companys Financial Statements for more information regarding share-based payments.

Business acquisitions

Management uses various valuation
techniques when determining the fair values of certain assets and liabilities acquired in a business combination.

Refer to Note 17 of the Companys
Financial Statements for more information regarding business acquisitions.

Standards Issued and Not Yet Effective but Early Adopted

On January 1, 2015, the Company adopted and implemented IFRS 9 (2013) - Financial Instruments. This standard replaces IAS 39 - Financial Instruments:
Recognition and Measurement and previous versions of IFRS 9. IFRS 9 (2013) includes revised guidance on the classification and measurement of financial assets and liabilities and introduces a new general hedge accounting model which aims to better
align a companys hedge accounting with risk management.

New Standards and Interpretations Issued but Not Yet Effective

Certain new standards, amendments and interpretations, and improvements to existing standards have been published by the IASB but are not yet effective, and
have not been adopted early by the Company. Management anticipates that all of the relevant pronouncements will be adopted in the first reporting period following the date of application. Information on new standards, amendments and interpretations,
and improvements to existing standards, which could potentially impact the Companys Financial Statements, are detailed as follows:

IFRS 15 
Revenue from Contracts with Customers replaces IAS 18  Revenue, IAS 11  Construction Contracts and some revenue related interpretations. IFRS 15 establishes a new control-based revenue recognition model, changes the basis for deciding
when revenue is recognized at a point in time or over time, provides new and more detailed guidance on specific topics and expands and improves disclosures about revenue. IFRS 15 is effective for annual reporting periods beginning on or after
January 1, 2018. Management has performed a preliminary review of the new guidance as compared to its current accounting policies, and began a review of its sales contracts. Based on its initial evaluation, management does not expect the new
guidance to materially impact the Companys Financial Statements. In 2017, management plans to finalize its review and determine the method of adoption.

IFRS 9 (2014) - Financial Instruments was issued in July 2014 and differs in some regards from IFRS 9 (2013) which the Company adopted effective
January 1, 2015. IFRS 9 (2014) includes updated guidance



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on the classification and measurement of financial assets. The final standard also amends the impairment model by introducing a new expected credit loss model for calculating impairment. The
mandatory effective date of IFRS 9 (2014) is for annual periods beginning on or after January 1, 2018 and must be applied retrospectively with some exemptions. Early adoption is permitted. Based on its initial evaluation, management does not
expect the new guidance to materially impact the Companys Financial Statements. In 2017, management plans to finalize its review and determine the method of adoption.

IFRS 16 - Leases which will replace IAS 17 - Leases was issued in January 2016. IFRS 16 eliminates the classification of an operating lease and requires
lessees to recognize a right-of-use asset and a lease liability in the statement of financial position for all leases with exemptions permitted for short-term leases and
leases of low value assets. In addition, IFRS 16 changes the definition of a lease; sets requirements on how to account for the asset and liability, including complexities such as non-lease elements, variable
lease payments and option periods; changes the accounting for sale and leaseback arrangements; largely retains IAS 17s approach to lessor accounting and introduces new disclosure requirements. IFRS 16 is effective for annual reporting periods
beginning on or after January 1, 2019 with early application permitted in certain circumstances. Management is currently assessing but has not yet determined the impact of this new standard on the Companys Financial Statements.

Certain other new standards and interpretations have been issued but are not expected to have a material impact on the Companys Financial Statements.

Internal Control Over Financial Reporting

In
accordance with the Canadian Securities Administrators National Instrument 52-109, Certification of Disclosure in Issuers Annual and Interim Filings (NI
52-109), the Company has filed interim certificates signed by the Chief Executive Officer (CEO) and the CFO that, among other things, report on the design of disclosure controls and
procedures and design of internal control over financial reporting. With regards to the annual certification requirements of NI 52-109, the Company relies on the statutory exemption contained in section 8.2 of
NI 52-109, which allows it to file with the Canadian securities regulatory authorities the certificates required under the Sarbanes-Oxley Act of 2002 at the same time such certificates are required to be filed
in the United States of America.

Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of the
Companys financial reporting and its compliance with GAAP (as derived in accordance with IFRS) in its consolidated financial statements. The CEO and CFO of the Company have evaluated whether there were changes to the Companys internal
control over financial reporting during the Companys most recent interim period that have materially affected, or are reasonably likely to materially affect, the Companys internal control over financial reporting. The CEO and CFO have
concluded that the Companys internal control over financial reporting as of December 31, 2016 was effective.

All internal control systems, no
matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of its inherent limitation,
internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures may deteriorate.

Additional Information

Additional information relating to the Company is available on the Companys website (www.itape.com) as well as under the Companys profile on SEDAR
at www.sedar.com and on EDGAR at www.sec.gov.



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|Item 6: | Directors, Senior Management and Employees
|------- | ------------------------------------------



| | A. | DIRECTORS AND SENIOR MANAGEMENT
| | -- | -------------------------------

Directors

The following table sets forth the name, residence, position, and principal occupations for the last five (5) years of each Director of
the Company as of the date hereof, as well as the year during which each Director was first elected. Each Director is elected for a term of one year and may be nominated for re-election at the Companys
following annual shareholders meeting. The next annual shareholders meeting is scheduled to be held on June 7, 2017, at which time the current term of each Director will expire.



|                                |  |                                                                                                                                |  |                      
|------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------
|Name and
City of Residence      |  | Position and Occupation                                                                                                        |  | First Year asDirector
|Robert M. Beil Phoenix, Arizona |  | Director 
Retired, September 2006 
Sales, Marketing, Business and Executive Management, The Dow Chemical Company, 1975 to 2006 |  | 2007                 



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|                                                           |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                      
|---------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------
|Name and
City of Residence                                 |  | Position and Occupation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | First Year asDirector
|George J. Bunze, CPA, CMA Senneville, Quebec,
Canada       |  | Director  Chairman of the Board 
Vice-Chairman, Kruger Inc. (manufacturer of paper, tissue, wood products, energy (hydro/wind) and wine and spirits products), 1998 to present
 Director, Kruger, Inc., 1986 to present
 Director and Chairman of the Audit Committee, Stella-Jones Inc. (producer and marketer of
pressure treated wood products), 2001 to present                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | 2007                 
|                                                           |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Frank Di Tomaso, FCPA, FCA, ICD.D
Montreal, Quebec, Canada |  | Director 
Director, Birks Group Inc. (designer, manufacturer and retailer of jewelry, timepieces, silverware and gifts), 2014 to present
 Director, National Bank Trust (asset management and trust services firm), 2012 to
present  Director, National Bank Life Assurance Company, 2012 to present
 Director, Yorbeau Resources Inc. (gold exploration company), 2011 to 2016
 Director, ADF Group Inc. (complex structural steel and heavy built-up steel components for the non-residential construction industry), 2015 to present 
Director, Laurentian Pilotage Authority (regulates operations of pilotage services on the St. Lawrence River), 2011 to present
 Director, Redline Communications Group Inc. (wireless communications network designer and
manufacturer), 2010 to 2013  Partner and Advisory Partner, Raymond Chabot Grant
Thornton, 1981 to 2012 |  | 2014                 
|                                                           |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Robert J. Foster Toronto, Ontario,
Canada                  |  | Director 
Chief Executive Officer and President, Capital Canada Limited (investment banking firm), 1977 to present                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | 2010                 



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|                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                      
|----------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------
|Name and
City of Residence                |  | Position and Occupation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | First Year asDirector
|James Pantelidis Toronto, Ontario,
Canada |  | Director 
Director and Chairman of the Board of Parkland Fuel Corporation (distributor and marketer of fuels and lubricants), 1999 to present
 Director and Chairman of the Board of EnerCare Inc. (home services company),2002
to present  Director and Chairman of Human Resources Committee of RONA Inc. (retailer
and distributor of hardware, building materials and home renovation products), 2004to 2016 
Director, Chairman of the Investment Committee, and Member of the Human Resources and Compensation Committee, Industrial Alliance Insurance and Financial
Services Inc. (insurance company), 2002 to 2016 |  | 2012                 
|                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Jorge N. Quintas Porto, Portugal          |  | Director 
President, Nelson Quintas SGPS, SA (manufacturer of electrical and telecommunication cables), 2009 to present                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | 2009                 
|                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Mary Pat Salomone Naples, Florida         |  | Director 
Director, Herc Holdings Inc. (rental company), 2016 to present 
Director, TransCanada Corporation (energy infrastructure company), 2013 to present 
Director, TransCanada Pipelines Limited (energy infrastructure company), 2013 to present
 Senior Vice President and COO, The Babcock & Wilcox Company (power generation
systems and specialty manufacturer of nuclear components company), 2010 to 2013                                                                                                                                                                                                       |  | 2015                 
|                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Gregory A.C. Yull Sarasota, Florida       |  | Director 
CEO and President of the Company, 2010 to present 
President Tapes and Films Division of the Company, 2008 to 2010 
Executive Vice President, Industrial Business Unit for Tapes and Films, 2004 to 2008                                                                                                                                                                                                                                                                                                                                                                                                          |  | 2010                 



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|                                    |  |                                                                                                                                                                                                            |  |                      
|----------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------
|Name and
City of Residence          |  | Position and Occupation                                                                                                                                                                                    |  | First Year asDirector
|Melbourne F. Yull Sarasota, Florida |  | Director 
Executive Director through June 8, 2010 
Retired, 2006 to 2007 
Prior thereto he was Chairman of the Board and Chief Executive Officer of the Company, 1981 to 2006
 Father of Gregory A.C. Yull |  | 1989-20062007        

Senior Management

The following table sets forth the name, residence and position of each member of senior management of the Company as of the date hereof, as
well as the year during which each was first elected.



|                                           |  |                                                         |  |                       
|------------------------------------------ |  | ------------------------------------------------------- |  | ----------------------
|Name and City of
Residence                 |  | Position and Occupation                                 |  | First ElectedTo Office
|Gregory A.C. Yull
Sarasota, Florida        |  | Chief Executive Officer & President                     |  | 2010                  
|                                           |  |                                                        
|Jeffrey Crystal, CPA, CA
Sarasota, Florida |  | Chief Financial Officer                                 |  | 2014                  
|                                           |  |                                                        
|Douglas Nalette 1
Longboat Key, Florida    |  | Senior Vice President, Operations                       |  | 2006                  
|                                           |  |                                                        
|Shawn Nelson 1
Bradenton, Florida          |  | Senior Vice President Sales                             |  | 2010                  
|                                           |  |                                                        
|Joseph Tocci 1
Bradenton, Florida          |  | Senior Vice President, Global Sourcing and Supply Chain |  | 2013                  





|1 | Officer of Intertape Polymer Corp., a wholly owned subsidiary of the Company
|- | ----------------------------------------------------------------------------

The principal
occupation of each member of senior management for the last five (5) years is as follows:

Gregory A.C. Yull was
appointed Chief Executive Officer and President on June 8, 2010. He was President, Tapes & Films, from 2008 to June 2010. Gregory A.C. Yull is a son of Melbourne F. Yull.

Jeffrey Crystalwas appointed Chief Financial Officer on May 9, 2014. Prior to that, he served as Vice President of Finance of
Primo International since December 2013. Prior to that, he served as Chief Financial Officer of American Iron & Metal from June 2008 to February 2013.

Douglas Nalette was appointed Senior Vice President Operations in 2006.

Shawn Nelson was appointed Senior Vice President Sales in 2010. Prior to that, he served as Senior Vice President Industrial Channel
since 2006.

Joseph Tocci was appointed Senior Vice President of Global Sourcing and Supply Chain in 2013. Prior to that, he served
as Senior Vice President of Corporate Marketing, Research & Development, and Supply Chain since 2012. Prior to that, he served as Senior Vice President of Corporate Marketing and Supply Chain since 2011. Prior to that, he served as Senior
Vice President of Consumer and Supply Chain since 2008.



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| | B. | COMPENSATION
| | -- | ------------

The following table sets forth the compensation paid, and benefits in kind
granted, to the Companys Directors and senior management for the last fiscal year for services in all capacities to the Company, including contingent and deferred compensation.



|                                                                  |  |             |         |  |                     |  |         |                            |  |  |                             |     |  |                |         |  |                |  |         |  |  |  |        | 
|----------------------------------------------------------------- |  | ----------- | ------- |  | ------------------- |  | ------- | -------------------------- |  |  | --------------------------- | --- |  | -------------- | ------- |  | -------------- |  | ------- |  |  |  | ------ | 
|2016                                                              |  |             |         |  | Annual Compensation |  |         | PerformanceShare Unit Plan |  |  | Deferred Share UnitPlan     |    
|Name and principal
position                                       |  | Salary (1)$ |         |  | Bonus$              |  |         | Other$                     |  |  | Director/CommitteeFees (2)$ |     |  | Awardsgranted# |         |  | Awardsgranted# | 
|Robert M. BeilDirector                                            |  |             |        |  |                     |  |        |                            |  |  |                            |     |  |                | 57,500  |  |                |  |        |  |  |  | 5,807  | 
|George J. BunzeDirector, Chairman                                 |  |             |        |  |                     |  |        |                            |  |  |                            |     |  |                | 110,500 |  |                |  |        |  |  |  | 11,216 | 
|Frank Di TomasoDirector                                           |  |             |        |  |                     |  |        |                            |  |  |                            |     |  |                | 61,500  |  |                |  |        |  |  |  | 4,276  | 
|Robert J. FosterDirector                                          |  |             |        |  |                     |  |        |                            |  |  |                            |     |  |                | 63,500  |  |                |  |        |  |  |  | 7,937  | 
|James PantelidisDirector                                          |  |             |        |  |                     |  |        |                            |  |  |                            |     |  |                | 52,000  |  |                |  |        |  |  |  | 4,276  | 
|Jorge N. QuintasDirector                                          |  |             |        |  |                     |  |        |                            |  |  |                            |     |  |                | 50,500  |  |                |  |        |  |  |  | 6,985  | 
|Mary Pat SalomoneDirector                                         |  |             |        |  |                     |  |        |                            |  |  |                            |     |  |                | 59,000  |  |                |  |        |  |  |  | 6,276  | 
|Melbourne F. YullDirector                                         |  |             |        |  |                     |  |        |                            |  |  | 260,935                     | (3) |  |                | 52,000  |  |                |  |        |  |  |  | 5,892  | 
|Gregory A.C. YullDirector, Chief Executive Officer & President    |  |             | 731,378 |  |                     |  | 989,607 |                            |  |  | 40,962                      | (4) |  |                |        |  |                |  | 108,131 |  |  |  |       | 
|Jeffrey CrystalChief Financial Officer                            |  |             | 380,439 |  |                     |  | 409,877 |                            |  |  |                            |     |  |                |        |  |                |  | 27,363  |  |  |  |       | 
|Douglas NaletteSenior Vice-President Operations                   |  |             | 357,772 |  |                     |  | 269,545 |                            |  |  |                            |     |  |                |        |  |                |  | 14,485  |  |  |  |       | 
|Shawn NelsonSenior Vice-President Sales                           |  |             | 340,725 |  |                     |  | 283,145 |                            |  |  |                            |     |  |                |        |  |                |  | 14,485  |  |  |  |       | 
|Joseph TocciSenior Vice-President, Global Sourcing & Supply Chain |  |             | 318,465 |  |                     |  | 251,870 |                            |  |  |                            |     |  |                |        |  |                |  | 13,158  |  |  |  |       | 



|(1) | Represents amounts included in each executives W-2, rather than the base salary amount.
|--- | ----------------------------------------------------------------------------------------

|(2) | Represents total compensation for Board and Committee fees, which includes both cash payments and the value of DSUs elected in lieu of cash for such fees.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Mr. Yull receives a pension from IPG (see Pension and Other Post-Retirement Benefit Plans subsection below).
|--- | --------------------------------------------------------------------------------------------------------------

|(4) | Represents a Company leased vehicle and associated tax gross up paid by IPG to Mr. Yull pursuant to the terms of Mr. Yulls employment agreement.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------

2016 Senior Management Bonus Plan

Each of the members of senior management received a performance bonus for 2016. Bonuses were paid based on the level of achievement of
financial objectives of the Company. The Company attributes to each executive, depending on his or her management level, a bonus target level set as a percentage of his or her salary, representing the amount that will be paid if all objectives are
achieved according to the targets set. Actual bonuses may vary between zero and twice the target bonus, based on the level of achievement of the predetermined objectives set out at the beginning of the fiscal year. The objectives and weight attached
thereto are re-evaluated on an annual basis by the Compensation Committee and communicated to the relevant individuals. The Compensation Committee has discretion to adjust bonus payments upwards or downwards.



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For the fiscal year ended December 31, 2016, the bonuses were based on the Company achieving
certain target amounts for:

(i)     Compensation Adjusted EBITDA, which the Compensation Committee of the Board of
Directors defines as Adjusted EBITDA excluding: (i) performance bonus expense; (ii) the positive or negative impact on Adjusted EBITDA of the business acquired in the current year; (iii) due diligence costs and other advisory fees
associated with mergers and acquisitions projects; and (iv) the positive or negative impact of the South Carolina Flood. The Company defines Adjusted EBITDA as net earnings (loss) before: (i) interest and other finance costs;
(ii) income tax expense (benefit); (iii) amortization of intangible assets; (iv) depreciation of property, plant and equipment; (v) manufacturing facility closures, restructuring and other related charges; (vi) stock-based
compensation expense (benefit); (vii) impairment of goodwill; (viii) impairment (reversal of impairment) of long-lived assets and other assets; (ix) write-down on assets classified as held-for-sale; (x) (gain) loss on disposal of property, plant, and equipment and (xi) other discrete items as disclosed; and

(ii)    Compensation Cash Flows, which the Compensation Committee of the Board of Directors defines as cash flows from
operating activities excluding: (i) performance bonus expense; (ii) the cash flows from operating activities of the business acquired in the current year; (iii) due diligence costs and other advisory fees associated with mergers and
acquisitions projects; (iv) the positive or negative impact of the South Carolina Flood; and (v) Litigation Settlement.

At the
Compensation Committees recommendation, the Board of Directors elected to use Compensation Adjusted EBITDA and Compensation Cash Flows in determining bonuses for 2016 because certain expenses and charges expected (at the time of the
Boards election) to be incurred by the Company during the year (e.g., due diligence costs and other advisory fees associated with mergers and acquisitions projects and manufacturing facility closures, restructuring and other related charges)
were viewed to be in the long term interest of the Company and that such amounts should not impact the ability of senior management to achieve the performance bonus targets. In determining the actual Compensation Adjusted EBITDA and Compensation
Cash Flows, the Compensation Committee used its discretion to exclude an additional immaterial expense.

The target amount for
Compensation Adjusted EBITDA for 2016 was set at $126,000,000 (the Compensation Adjusted EBITDA Target) and the target amount for Compensation Cash Flows was set at $96,000,000(the Compensation Cash Flows Target). The
Companys actual Compensation Adjusted EBITDA for 2016 was $128,555,000which was 102.0% of the Compensation Adjusted EBITDA Target. The Companys actual Compensation Cash Flows for 2016 was $108,532,000which was 113.1% of
the Compensation Cash Flows Target.

The following table presents the target incentive compensation as a percentage of salary, the
indicators used in 2016 to measure the Companys performance for purposes of the short term incentive compensation program and their relative weight.



|                                                 |  |  |                            |  |  |                |          |       |             |   |         |                |  |   |             |       |  |   |         |       |  |  |         |      
|------------------------------------------------ |  |  | -------------------------- |  |  | -------------- | -------- | ----- | ----------- | - | ------- | -------------- |  | - | ----------- | ----- |  | - | ------- | ----- |  |  | ------- | -----
|                                                 |  |  | GregoryA.C. Yull           |  |  | JeffreyCrystal |          |       | ShawnNelson |   |         | DouglasNalette |  |   | JosephTocci |      
|2016 Annual Eligible Base Salary                 |  |  |                            |  |  | $              | 770,000  |       |             | $ | 435,000 |                |  | $ | 342,280     |       |  | $ | 360,600 |       |  |  | 320,770 |      
|Incentive compensation as a percentage of salary |  |  | MinimumTarget Maximum      |  |  |                | 0100
150 | % % % |             |   | 060
120 | % % %          |  |   | 050
100     | % % % |  |   | 050
100 | % % % |  |  | 050
100 | % %
%
|Relative weight of financial Indicators          | 
|                                                 |  |  | CompensationAdjustedEBITDA |  |  |                | 60       | %     |             |   | 60      | %              |  |   | 60          | %     |  |   | 60      | %     |  |  | 60      | %    
|                                                 |  |  | CompensationCash Flows     |  |  |                | 40       | %     |             |   | 40      | %              |  |   | 40          | %     |  |   | 40      | %     |  |  | 40      | %    
|                                                 |  |  |                            |  |  |                |          |       |             |   |         |                |  |   |             |       |  |   |         |       |  |  |         |      
|Total                                            |  |  |                            |  |  |                | 100      | %     |             |   | 100     | %              |  |   | 100         | %     |  |   | 100     | %     |  |  | 100     | %    
|                                                 |  |  |                            |  |  |                |          |       |             |   |         |                |  |   |             |       |  |   |         |       |  |  |         |      



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The bonus is calculated using, for each of the Compensation Adjusted EBITDA and Compensation Cash
Flows objectives, the following formula and is equal to the sum of all results:



|                                      |  |   |  |                                                                                                                                                 |  |   |  |                              
|------------------------------------- |  | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------- |  | - |  | -----------------------------
|Annual Eligible Base salary at target |  | X |  | Bonus percentage (as determined based on the performance relative to the applicable objectives target and as capped by the applicable maximum) |  | X |  | Weight of financial indicator

For purposes of the above calculation, bonus percentage is between 35% and 100% if between approximately 90%and 100% of the target objectives were achieved by the Company, respectively. For achievement between 90% and 100%, the bonus percentage is interpolated between 35% and 100%. For achievement above 100%, the bonus
percentage is capped at 100% for purposes of calculating the bonuses for each of the Compensation Adjusted EBITDA and Compensation Cash Flows objectives but such achievement triggers respective additional reach bonuses described
below.

The members of senior management were also eligible for an additional bonus calculated using a Compensation Adjusted EBITDA target amount of
$135,000,000 (the Reach Adjusted EBITDA Target). This additional bonus is calculated using the following formula (note that the fraction below is capped by the applicable maximum (i.e., it cannot exceed 1)):



|                                                      |  |   |  |                                            |  |   |  |                              
|----------------------------------------------------- |  | - |  | ------------------------------------------ |  | - |  | -----------------------------
|Actual Adjusted EBITDA  Adjusted EBITDA Target       |  | X |  | Maximum bonus amount 
Target bonus amount |  | X |  | Weight of financial indicator
|Reach Adjusted EBITDA Target  Adjusted EBITDA Target |  |   |  |                                            |  |   |  |                              

The members of senior management were also eligible for an additional bonus calculated using a Compensation Cash Flows target
amount of $102,000,000 (the Reach Cash Flows Target). This additional bonus is calculated using the following formula (note that the fraction below is capped by the applicable maximum (i.e., it cannot exceed 1)):



|                                                                |  |   |  |                                            |  |   |  |                              
|--------------------------------------------------------------- |  | - |  | ------------------------------------------ |  | - |  | -----------------------------
|Actual Cash flows from operating activities  Cash Flows Target |  | X |  | Maximum bonus amount 
Target bonus amount |  | X |  | Weight of financial indicator
|Reach Cash Flows Target  Cash Flows Target                     |  |   |  |                                            |  |   |  |                              

The following table presents the objectives for 2016 approved by the Board of Directors and the results achieved by the
Company.



|                             |  |        |             |  |        |   |             |                          |  |  |       |  
|---------------------------- |  | ------ | ----------- |  | ------ | - | ----------- | ------------------------ |  |  | ----- | -
|                             |  | Target |             |  | Result |   |             | Evaluation ofPerformance | 
|Compensation Adjusted EBITDA |  | $      | 126,000,000 |  |        | $ | 128,555,000 |                          |  |  | 102.0 | %
|Compensation Cash Flows      |  | $      | 96,000,000  |  |        | $ | 108,532,000 |                          |  |  | 113.1 | %
|Reach Adjusted EBITDA        |  | $      | 135,000,000 |  |        | $ | 128,555,000 |                          |  |  | 95.2  | %
|Reach Cash Flows             |  | $      | 102,000,000 |  |        | $ | 108,532,000 |                          |  |  | 106.4 | %



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The following table presents, for each target objective, the bonus amount earned by each member of senior
management for 2016.



|                             |  |                  |         |  |                |   |         |             |  |   |                |  |  |             |         |  |  |   |         | 
|---------------------------- |  | ---------------- | ------- |  | -------------- | - | ------- | ----------- |  | - | -------------- |  |  | ----------- | ------- |  |  | - | ------- | 
|                             |  | GregoryA.C. Yull |         |  | JeffreyCrystal |   |         | ShawnNelson |  |   | DouglasNalette |  |  | JosephTocci |        
|Compensation Adjusted EBITDA |  | $                | 462,000 |  |                | $ | 156,600 |             |  | $ | 102,984        |  |  | $           | 108,180 |  |  | $ | 96,231  | 
|Compensation Cash Flows      |  | $                | 308,000 |  |                | $ | 104,400 |             |  | $ | 68,656         |  |  | $           | 72,120  |  |  | $ | 64,154  | 
|Reach Adjusted EBITDA        |  | $                | 65,607  |  |                | $ | 44,477  |             |  | $ | 29,249         |  |  | $           | 30,725  |  |  | $ | 27,331  | 
|Reach Cash Flows             |  | $                | 154,000 |  |                | $ | 104,400 |             |  | $ | 68,656         |  |  | $           | 72,120  |  |  | $ | 64,154  | 
|                             |  |                  |         |  |                |   |         |             |  |   |                |  |  |             |         |  |  |   |         | 
|Total                        |  | $                | 989,607 |  |                | $ | 409,877 |             |  | $ | 269,545        |  |  | $           | 283,145 |  |  | $ | 251,870 | 
|                             |  |                  |         |  |                |   |         |             |  |   |                |  |  |             |         |  |  |   |         | 

Defined Contribution Pension Plans

The Company maintains defined contribution pension plans in the United States and Canada. Each member of senior management participates in the
US Plan. The US Plan is a defined contribution pension plan and qualifies as a deferred salary arrangement under section 401(k) of the United States Internal Revenue Code. Under the US Plan, employees who have been employed for at least
90 days may defer a portion of their pre-tax earnings subject to statutory limitations. The Company may make discretionary contributions for the benefit of eligible employees. The US Plan permits eligible
employees to choose how their account balances are invested on their behalf within a range of investment options provided by third-party fund managers. The following table sets out the Companys contributions to the pension plan payable for
2016 for each member of senior management.



|                  |  |                       |        | 
|----------------- |  | --------------------- | ------ | 
|Name              |  | CompanyContributions$ |       
|Gregory A.C. Yull |  | $                     | 14,575 | 
|Jeffrey Crystal   |  | $                     | 14,575 | 
|Douglas Nalette   |  | $                     | 14,575 | 
|Shawn Nelson      |  | $                     | 14,575 | 
|Joseph Tocci      |  | $                     | 14,575 | 

Total Cash Payments

Total cash payments for employee future benefits for 2016, consisting of cash contributed by the Company to its unfunded pension plans, cash
payments directly to beneficiaries for its unfunded other benefit plans, cash contributed to its defined contribution plans and cash contributed to its multi-employer defined benefit plans, were $6.0 million ($5.4 million in 2015).



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Executive Employment Contracts and Change of Control Agreements

The following agreements between the Company and members of senior management were in effect at the end of 2016.

The Company entered into change of control agreements as of January 2001 with Shawn Nelson, as of October 28, 2004 with
Douglas Nalette, and as of September 8, 2006 with Joseph Tocci. These agreements provide that if, within a period of six months after a change of control of the Company: (a) the executive voluntarily terminates his employment with the
Company; or (b) the Company terminates the executives employment without cause, such executive will be entitled to, subject to the restrictions of Section 409A of the Internal Revenue Code of 1986, in deferred compensation, a lump sum in
the case of his resignation or an indemnity in lieu of notice in a lump sum in the case of his termination, equal to 12 months of such executives base remuneration at the effective date of such resignation or termination, and continued
insurance coverage then in effect if permitted by its carrier during such period.

Furthermore, these agreements also provide that if
during the term of the executives employment a bona fide offer is made to all shareholders of the Company which, if accepted, would result in a change of control of the Company, then, subject to any applicable law, all of the
executives stock options which have not yet become vested and exercisable shall become vested and exercisable immediately. Upon expiry of such bona fide offer, if it does not result in a change of control of the Company, all of the
executives unexercised stock options which were not vested prior to such offer, shall immediately revert to their unvested status and to their former provisions with respect to the time of their vesting.

On August 2, 2010, the Company entered into an Executive Employment Agreement with Gregory A.C. Yull. Pursuant to the terms of the
Agreement, Mr. Yull received an annual base salary of $450,000 which increased to $475,000 commencing June 1, 2011 and to $500,000 commencing on June 1, 2012. Also pursuant to the terms of the Agreement, as of June 1, 2013 and
thereafter, annual base salary adjustment has been and will be determined by the Board. Mr. Yull shall also be entitled to a performance bonus for each fiscal year ranging from zero to 150% of his then current annual base salary based on the
achievement of specific goals that are mutually agreed to between Mr. Yull and the Board. For 2016, Mr. Yulls bonus was based on the Company achieving certain target amounts for Compensation Adjusted EBITDA Targets and Compensation
Cash Flow Targets, as further described above in the Section entitled 2016 Senior Management Bonus Plan. During the first three years of Mr. Yulls employment, commencing June 8, 2010, Mr. Yull was to have been
granted 350,000 stock options annually in accordance with the Companys Executive Stock Option Plan (ESOP) and thereafter at the discretion of the Board of Directors. In 2012, instead of receiving an award of 350,000 stock options
in accordance with his employment agreement, Mr. Yull agreed to receive 500,905 stock appreciation rights under the Companys 2012 Stock Appreciation Rights Plan described below. The options granted during each of the first two years
became exercisable in annual increments of 25% on each of the first four anniversaries of the grant date. Such options shall expire on the tenth anniversary of the grant date, subject to the early expiry provisions of the ESOP. The exercise price of
such options shall be equal to the closing market price on the last trading day prior to the date of such grant. Fifty percent (50%) of the shares acquired by Mr. Yull pursuant to the exercise of the options granted under the Executive
Employment Agreement must be retained by Mr. Yull and not sold or disposed of for a period of three years following the date when the option was exercised.

Unless earlier terminated by the Company without cause or by Mr. Yull for Good Reason as defined in the Agreement, he shall receive a
defined benefit supplementary pension annually for life equal to the lesser of: (i) $600,000 if he separates from service at age 65 or older, $570,000 at age 64, $540,000 at age 63, $510,000 at age 62, $480,000 at age 61, or $450,000 at age 60; and
(ii) two percent of the average of his total cash compensation (base salary and performance bonus) for the highest five years of his employment during the prior ten years as of the time of separation, multiplied by his years of service with the
Company. In the event of Mr. Yulls death, his surviving spouse would receive 50% of the annual supplement pension benefit within ninety days of his death and continuing annually during her lifetime.

In the event the Company terminates Mr. Yulls employment for any reason other than cause, or Mr. Yull terminates his
employment for Good Reason as defined in the Agreement, Mr. Yull shall be entitled to severance pay in an amount equal to two times the sum of his base salary and the average performance bonus paid to Mr. Yull in the last two fiscal years
ending on the date prior to his date of termination. Subject to the restrictions of Section 409A of the Internal Revenue Code of 1986, such amount shall be paid 65% in a lump sum and the balance in eight equal quarterly installments. In addition,
all unvested options that would otherwise vest during the 24 months following the date of termination shall be immediately vested and remain exercisable for a period of twelve months. Lastly, the retirement benefits set forth above shall vest.

In the event that Mr. Yulls employment is terminated as a result of his Permanent Disability, as defined in the Agreement, or
death, he shall be entitled to receive: (i) accrued and unpaid base salary earned up to the date of termination; (ii)



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a pro-rated performance bonus that he would have received in respect of the fiscal year in which the termination occurred; (iii) vacation pay earned
up to the date of termination; and (iv) provided the date of termination is on or after the fifth year anniversary of the Agreement, the retirement benefits set forth above shall vest. In addition, all unvested stock options held by
Mr. Yull shall immediately vest and remain exercisable for a period of nine months following the date of termination for Permanent Disability or death.

In the event that Mr. Yulls employment is terminated by the Company without cause or for Good Reason within two years of a Change
of Control, as defined in the Agreement, then he shall be entitled to receive: (i) accrued and unpaid base salary earned up to the date of termination; (ii) a pro-rated performance bonus that he
would have received in respect of the fiscal year in which the termination occurred, based upon the average performance bonus paid to Mr. Yull in the last two fiscal years; (iii) vacation pay earned up to the date of termination; and
(iv) severance pay in an amount equal to three times the sum of his base salary and the average performance bonus paid in the last two fiscal years immediately preceding the date of termination. In addition, all unvested stock options held by
Mr. Yull shall immediately vest and remain exercisable for a period of 36 months following the date of termination, and the retirement benefits set forth above shall vest. Mr. Yull shall also be entitled to participate, at his cost, in the
benefits under the Companys medical and dental benefit program until such time as he reaches the age of eligibility for coverage under Medicare. Lastly, disability and life insurance benefits shall be provided for the benefit of Mr. Yull
pursuant to any benefit plans and programs then provided by the Company generally to its executives and continue for a period of 36 months following the date of termination.

Mr. Yull has also agreed to a customary non-compete for two years from the date of termination.

On March 21, 2014, the Company and Mr. Crystal mutually agreed to certain terms of employment. Under these terms,
Mr. Crystal was to receive an annual base salary of $330,000. Mr. Crystal also was to be entitled to a bonus ranging from zero to 50% of his then-current annual base salary based on the achievement of certain target amounts for Adjusted
EBITDA Targets and Cash Flow Targets, with the bonus opportunity increasing to 100% of his then-current annual base salary based on the achievement of certain stretch Adjusted EBITDA goals. While a definitive employment agreement has yet to be
entered into between the Company and Mr. Crystal and the above terms have not been amended in writing, the actual compensation practices have varied from the above terms. For a description of the 2016 compensation of Mr. Crystal, please
see the Section entitled Compensation.

In addition, the Company agreed to cover certain of Mr. Crystals relocation
costs. Further, the terms provide that Mr. Crystal will be entitled to severance pay in an amount equal to twelve months base annual salary, or if Mr. Crystal were terminated within six months of change of control, he will be entitled to
severance pay in an amount equal to eighteen months base annual salary. Alternatively, if Mr. Crystal were to resign within six months of change of control, or the Company were to terminate Mr. Crystal after six months of change of
control, he will be entitled to severance pay in an amount equal to twelve months base annual salary. Mr. Crystal shall also be entitled to continue insurance coverage then in effect if permitted by its carrier during such period.

Executive Stock Option Plan

In 1992, the Company adopted the Executive Stock Option Plan (the ESOP). Since its adoption, the ESOP has been amended on several
occasions. The ESOP provides that the total number of common shares reserved for issuance thereunder is equal to 10% of the issued and outstanding common shares of the Company from time to time. The ESOP is considered to be an evergreen
plan, because the number of common shares covered by options which have been exercised will be available for subsequent grants under the ESOP and the number of options available for grants increases as the number of issued and outstanding common
shares of the Company increases. As such, under the rules of the TSX, a security-based arrangement such as the ESOP must, when initially put in place, receive shareholder approval at a duly-called meeting of shareholders and the unallocated options
are subject to ratification by shareholders every three years thereafter. All unallocated options under the ESOP were ratified, confirmed and approved by shareholders at a special meeting of shareholders of the Company held on June 4, 2015.

The purpose of the ESOP is to promote a proprietary interest in the Company among the executives, key employees and directors of the
Company and its subsidiaries, in order to both encourage such persons to further the development of the Company and assist the Company in attracting and retaining key personnel necessary for the Companys long-term success. The Board of
Directors designates from time-to-time those persons to whom options are to be granted and determines the number of common shares subject to such options. Generally,
participation in the ESOP is limited to persons holding positions that can have an impact on the Companys long-term results.



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The number of common shares to which the options relate is determined by taking into account,
inter alia, the market value of the common shares and each optionees base salary.

The following is a description of certain
features of the ESOP (for further details regarding the ESOP, please see Exhibit 4.1 to this Form 20-F):



| | (a) | options expire not later than ten years after the date of grant and, unless otherwise determined by the Board of Directors, all vested options under a particular grant expire 24 months after the vesting date of the last
tranche of such grant;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | options that are granted to directors who are not executives officers of the Corporation vest 25% on the date of grant, with another 25% vesting on each of the first three anniversaries of the date of the grant. Under
the current amended plan, all other options granted vest as to one-third on each of the first, second and third anniversaries of the date of grant. Previously, the ESOP provided that such stock options
granted, other than to directors who are not executives, vest 25% per year over four years;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | the exercise price of the options is determined by the Board of Directors, but cannot be less than the Market Value of the common shares of the Company, defined in the ESOP as the closing price of the common
shares on the TSX for the day immediately preceding the effective date of the grant; and
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) | certain limitations exist on the number of options, common shares reserved for issuance, number of common shares issuable and the number of common shares issued to certain individuals over certain time periods.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

As of December 31, 2016, there were options outstanding under the ESOP to purchase an aggregate of 1,061,250 common
shares, representing 1.8% of the issued and outstanding common shares of the Company, and a total of 692,500 options exercisable. During 2016, no options were granted.

Year-End Unexercised Options and Option Values

The following table sets out for each of the Directors and members of senior management the total number of unexercised options held as of
December 31, 2016 and the value of such unexercised options at that date.



|                  |  |                                                                            |         |  |                                                                                                 |  |   |  |  |  |         |  |  |  |           |  |  |  |   |  |  |  |           | 
|----------------- |  | -------------------------------------------------------------------------- | ------- |  | ----------------------------------------------------------------------------------------------- |  | - |  |  |  | ------- |  |  |  | --------- |  |  |  | - |  |  |  | --------- | 
|Name              |  | Number of unexercised optionsat fiscal
year-endExercisable / Unexercisable |         |  | Value of unexercised in the moneyoptionsat fiscal
year-endExercisable / Unexercisable CDN$(1) | 
|Robert M. Beil    |  |                                                                            | 20,000  |  |                                                                                                 |  | / |  |  |  |        |  |  |  | 367,700   |  |  |  | / |  |  |  |          | 
|George J. Bunze   |  |                                                                            | 15,000  |  |                                                                                                 |  | / |  |  |  |        |  |  |  | 249,550   |  |  |  | / |  |  |  |          | 
|Frank Di Tomaso   |  |                                                                            |        |  |                                                                                                 |  | / |  |  |  |        |  |  |  |          |  |  |  | / |  |  |  |          | 
|Robert J. Foster  |  |                                                                            | 10,000  |  |                                                                                                 |  | / |  |  |  |        |  |  |  | 131,400   |  |  |  | / |  |  |  |          | 
|Jorge N. Quintas  |  |                                                                            | 2,500   |  |                                                                                                 |  | / |  |  |  |        |  |  |  | 32,850    |  |  |  | / |  |  |  |          | 
|James Pantelidis  |  |                                                                            | 10,000  |  |                                                                                                 |  | / |  |  |  |        |  |  |  | 131,400   |  |  |  | / |  |  |  |          | 
|Mary Pat Salomone |  |                                                                            |        |  |                                                                                                 |  | / |  |  |  |        |  |  |  |          |  |  |  | / |  |  |  |          | 
|Melbourne F. Yull |  |                                                                            | 20,000  |  |                                                                                                 |  | / |  |  |  |        |  |  |  | 367,700   |  |  |  | / |  |  |  |          | 
|Gregory A.C. Yull |  |                                                                            | 278,750 |  |                                                                                                 |  | / |  |  |  | 146,250 |  |  |  | 3,621,975 |  |  |  | / |  |  |  | 1,880,925 | 
|Jeffrey Crystal   |  |                                                                            | 16,250  |  |                                                                                                 |  | / |  |  |  | 16,250  |  |  |  | 211,900   |  |  |  | / |  |  |  | 211,900   | 
|Douglas Nalette   |  |                                                                            | 53,750  |  |                                                                                                 |  | / |  |  |  | 28,750  |  |  |  | 697,987   |  |  |  | / |  |  |  | 369,488   | 
|Shawn Nelson      |  |                                                                            | 103,750 |  |                                                                                                 |  | / |  |  |  | 28,750  |  |  |  | 1,866,987 |  |  |  | / |  |  |  | 369,488   | 
|Joseph Tocci      |  |                                                                            | 60,000  |  |                                                                                                 |  | / |  |  |  | 22,500  |  |  |  | 911,300   |  |  |  | / |  |  |  | 290,550   | 



|(1) | The value of unexercised in-the-money options is calculated using the closing price of the common shares of IPG on the TSX on
December 30, 2016 (CDN$25.18)less the respective exercise prices of the options).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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2012 Stock Appreciation Rights Plan

The Board of Directors of the Company adopted the 2012 Stock Appreciation Rights Plan on June 20, 2012 in lieu of granting stock options
in 2012. The purpose of the 2012 Stock Appreciation Rights Plan is to: (a) promote a proprietary interest in the Company among its executives and directors; (b) encourage the Companys executives and directors to further the
Companys development; and (c) attract and retain the key employees necessary for the Companys long-term success. The 2012 Stock Appreciation Rights Plan is administered by the Compensation Committee of the Board of Directors of the
Company and authorizes the Company to award stock appreciation rights (SARs) to eligible persons. A SAR, as defined by the Companys plan, is a right to receive a cash payment equal to the difference between the base price of the
SAR and the market value of a common share of the Company on the date of exercise. These SARs can only be settled in cash and expire no later than 10 years after the date of the grant. The award agreements provide that these SARs granted to
employees and executives will vest and may be exercisable 25% per year over four years. The SARs granted to directors, who are not officers of the Company, will vest and may be exercisable 25% on the grant date, and a further 25% will vest and may
be exercisable per year over three years. On February 3, 2016, the Board of Directors amended the SAR Plan by adding a provision that the base price of each SAR is confirmed in writing to the participant at the time of grant and once so
confirmed, may not be changed and, on March 18, 2016, further amended the SARs Plan by adding a provision that once the expiry date of SARs is determined in the applicable agreement, such expiry date may not be extended. No SARs were granted in
2016.

The following table sets out for each of the Directors and members of senior management the total number of SARs held as of
December 31, 2016 and the value of such unexercised SARs at that date.



|                  |  |                                                                         |        |  |                                                                                |  |   |  |  |  |   |  |  |  |           |  |  |  |   |  |  |  |   | 
|----------------- |  | ----------------------------------------------------------------------- | ------ |  | ------------------------------------------------------------------------------ |  | - |  |  |  | - |  |  |  | --------- |  |  |  | - |  |  |  | - | 
|Name              |  | Number of unexercised SARs atfiscal
year-endExercisable / Unexercisable |        |  | Value of unexercised SARs atfiscal
year-endExercisable / Unexercisable CDN$(1) | 
|Robert M. Beil    |  |                                                                         | 10,000 |  |                                                                                |  | / |  |  |  |  |  |  |  | 176,200   |  |  |  | / |  |  |  |  | 
|George J. Bunze   |  |                                                                         | 10,000 |  |                                                                                |  | / |  |  |  |  |  |  |  | 176,200   |  |  |  | / |  |  |  |  | 
|Frank Di Tomaso   |  |                                                                         |       |  |                                                                                |  | / |  |  |  |  |  |  |  |          |  |  |  | / |  |  |  |  | 
|Robert J. Foster  |  |                                                                         | 10,000 |  |                                                                                |  | / |  |  |  |  |  |  |  | 176,200   |  |  |  | / |  |  |  |  | 
|James Pantelidis  |  |                                                                         | 30,000 |  |                                                                                |  | / |  |  |  |  |  |  |  | 528,600   |  |  |  | / |  |  |  |  | 
|Jorge N. Quintas  |  |                                                                         | 10,000 |  |                                                                                |  | / |  |  |  |  |  |  |  | 176,200   |  |  |  | / |  |  |  |  | 
|Mary Pat Salomone |  |                                                                         |       |  |                                                                                |  | / |  |  |  |  |  |  |  |          |  |  |  | / |  |  |  |  | 
|Melbourne F. Yull |  |                                                                         |       |  |                                                                                |  | / |  |  |  |  |  |  |  |          |  |  |  | / |  |  |  |  | 
|Gregory A.C. Yull |  |                                                                         |       |  |                                                                                |  | / |  |  |  |  |  |  |  |          |  |  |  | / |  |  |  |  | 
|Jeffrey Crystal   |  |                                                                         |       |  |                                                                                |  | / |  |  |  |  |  |  |  |          |  |  |  | / |  |  |  |  | 
|Douglas Nalette   |  |                                                                         |       |  |                                                                                |  | / |  |  |  |  |  |  |  |          |  |  |  | / |  |  |  |  | 
|Shawn Nelson      |  |                                                                         |       |  |                                                                                |  | / |  |  |  |  |  |  |  |          |  |  |  | / |  |  |  |  | 
|Joseph Tocci      |  |                                                                         | 80,000 |  |                                                                                |  | / |  |  |  |  |  |  |  | 1,409,600 |  |  |  | / |  |  |  |  | 



|(1) | The value of unexercised SARs is calculated using the closing price of the common shares of IPG on the TSX on December 30, 2016 (CDN$25.18 less the base price of the SARs).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Performance Share Unit Plan

On April 22, 2014, the Board of Directors of the Company adopted the PSU Plan. The purpose of the PSU Plan is to provide participants with
a proprietary interest in the Company to: (a) increase the incentives of those participants who share primary responsibility for the management, growth and protection of the business of the Company; (b) furnish an incentive to such
participants to continue their services for the Company; and (c) provide a means through which the Company may attract potential employees. The PSU Plan is administered by the Compensation Committee of the Board of Directors of the Company and
authorizes the Company to award PSUs to eligible persons. A PSU, as defined by the Companys PSU Plan, represents the right of a participant, once such PSU is earned and has vested in accordance with the PSU Plan, to receive the number of
common shares of the Company underlying the PSU. Furthermore, a participant will receive a cash payment from the Company



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upon PSU settlement that is equivalent to the number of shares issued or delivered to the participant multiplied by the amount of cash dividends per share declared by the Company between the date
of grant and the third anniversary of the grant date. PSUs are net-settled to satisfy minimum statutory tax withholding requirements.Accelerated vesting is permitted in the event of change of control,
as defined by the PSU Plan.

On May 9, 2016, the Board of Directors approved an amendment to the PSU Plan to provide the
Company the option of settling PSUs in cash. As a result of the amendment, in the event of cash settlement, the cash payment would equal the number of shares that would otherwise have been issued or delivered to the participant, multiplied by the
volume weighted average trading price of the shares on the TSX for the five consecutive trading days immediately preceding the day of payment. The Board had full discretion to determine the form of settlement of the PSUs and as of December 31,
2016, no such discretion had been used. As a result, the Company had no obligation to settle the PSUs in cash as of December 31, 2016, and the amendment to the PSU Plan had no impact on the treatment of the PSUs as equity-settled share-based
payment transactions as of December 31, 2016.

Additionally, on the same date, the Board of Directors approved an amendment to the
PSU Plan that allowed for accelerated vesting of PSUs in the event of death, disability or retirement of a participant. This amendment required the immediate recognition of expense associated with awards outstanding for certain retirement-eligible
participants, the impact of which was $0.4 million for the year ended December 31, 2016, and was included in earnings in selling, general and administrative expense.

PSUs are expensed straight-line over their vesting period. The fair value of the PSU is based on the close price for the common shares of the
Company on the TSX on the date of the grant adjusted for market-based performance conditions. The PSUs are earned over a three-year period with vesting at the third anniversary of the grant date. The number of shares earned can range from 0 to 150%
of the grant amount based on entity performance criteria, specifically the total shareholder return ranking versus a specified peer group of companies.

On February 17, 2017, the Board of Directors approved amendments to the PSU Plan to provide for only cash settlement of PSU awards. As a
result of the amendment, prospectively and until award settlement, the Company will remeasure the fair value of the awards at each reporting period end date and present the cash-settled awards as a liability within other liabilities and not in
contributed surplus in the consolidated balance sheets. Changes in the fair value of the liability will be reflected in SG&A.

PSU
Grants During the Most Recently Completed Fiscal Year

The following table sets out the details of all PSU grants to the members of
senior management during the fiscal year ended December 31, 2016.



|                  |  |                   |        |  |                                               |   |    |                                  |   |       |                 |  |            |           
|----------------- |  | ----------------- | ------ |  | --------------------------------------------- | - | -- | -------------------------------- | - | ----- | --------------- |  | ---------- | ----------
|Name              |  | PSU Awardsgranted |        |  | % of total PSUawards granted infinancial year |   |    | Market value ondate of grantCDN$ |   |       | Expiration date
|Gregory A.C. Yull |  |                   | 77,970 |  |                                               |   | 19 | %                                |   | $     | 17.58           |  |            | 12/30/2019
|                  |  | 30,161            |        |  |                                               | 7 | %  |                                  | $ | 25.36 |                 |  | 12/30/2019
|Jeffrey Crystal   |  |                   | 27,363 |  |                                               |   | 6  | %                                |   | $     | 17.58           |  |            | 12/30/2019
|Douglas Nalette   |  |                   | 14,485 |  |                                               |   | 3  | %                                |   | $     | 17.58           |  |            | 12/30/2019
|Shawn Nelson      |  |                   | 14,485 |  |                                               |   | 3  | %                                |   | $     | 17.58           |  |            | 12/30/2019
|Joseph Tocci      |  |                   | 13,158 |  |                                               |   | 3  | %                                |   | $     | 17.58           |  |            | 12/30/2019



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Year-End Vested and Unvested PSU Shares and Values

The following table sets out for each of the members of senior management the total number of vested and unvested PSU shares held as of
December 31, 2016 and the value of such vested and unvested shares at that date.



|                  |  |                                  |        |     |                                                               |  |         |                         |  |  |          |     |  |        |         |  |          |  |         |     |  |  |           | 
|----------------- |  | -------------------------------- | ------ | --- | ------------------------------------------------------------- |  | ------- | ----------------------- |  |  | -------- | --- |  | ------ | ------- |  | -------- |  | ------- | --- |  |  | --------- | 
|Name              |  | Number of PSUs at fiscalyear-end |        |     | Equivalent number of commonstock shares at fiscal year-end(1) |  |         | Value of shares CDN$(2) | 
|                  |  | Vested                           |        |     | Unvested                                                      |  |         | Vested                  |  |  | Unvested |     |  | Vested |         |  | Unvested | 
|Gregory A.C. Yull |  |                                  |       |     |                                                               |  | 221,091 |                         |  |  |         |     |  |        | 331,636 |  |          |  |        |     |  |  | 8,350,593 | 
|Jeffrey Crystal   |  |                                  |       |     |                                                               |  | 64,913  |                         |  |  |         |     |  |        | 97,370  |  |          |  |        |     |  |  | 2,451,764 | 
|Douglas Nalette   |  |                                  | 25,000 | (3) |                                                               |  | 14,485  |                         |  |  | 37,500   | (3) |  |        | 21,728  |  |          |  | 944,250 | (3) |  |  | 547,098   | 
|Shawn Nelson      |  |                                  |       |     |                                                               |  | 39,485  |                         |  |  |         |     |  |        | 59,228  |  |          |  |        |     |  |  | 1,491,348 | 
|Joseph Tocci      |  |                                  |       |     |                                                               |  | 31,168  |                         |  |  |         |     |  |        | 46,752  |  |          |  |        |     |  |  | 1,177,215 | 



|(1) | The equivalent number of common stock shares earned is based on the Corporations level of attainment of the performance objective measured at December 30, 2016. Based on the December 30, 2016 TSR
ranking, equivalent common shares are 150% of PSUs granted.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The value of vested and unvested shares is calculated using the closing price of the common shares of IPG on the TSX on December 30, 2016 (CDN$25.18).
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Accelerated vesting as a result of meeting retirement eligibility as defined by the PSU Plan.
|--- | ---------------------------------------------------------------------------------------------

Deferred Share Unit Plan

On April 22, 2014, the Board of Directors of the Company adopted the DSU Plan. The purpose of the DSU Plan is to provide participants with
a form of compensation which promotes greater alignment of the interests of the participants and the shareholders of the Company in creating long-term shareholder value. The DSU Plan is administered by the Compensation Committee of the Board of
Directors of the Company and authorizes the Company to award DSUs to any member of the Board of Directors of the Company that is not an executive officer or employee of the Company. A DSU, as defined by the Companys DSU Plan, represents the
right of a participant to receive a common share of the Company. Under the DSU Plan, each director is entitled to receive DSUs as a result of a grant and/or in lieu of cash for semi-annual directors fees. DSUs are settled when the director
ceases to be a member of the Board of Directors of the Company. DSUs are net-settled to satisfy minimum statutory tax withholding requirements.

DSUs received as a result of a grant are expensed immediately. The fair value of DSUs is based on the close price for the common shares of the
Company on the TSX on the date of the grant. DSUs received in lieu of cash for directors fees are expensed as earned over the service period.

On February 17, 2017, the Board of Directors approved amendments to the DSU Plan to provide for only cash settlement of DSU awards. As a
result of the amendment, prospectively and until award settlement, the Company will remeasure the fair value of the awards on amendment date and at each reporting period end date and present the cash-settled awards as a liability within other
liabilities and not in contributed surplus in the consolidated balance sheets. Changes in the fair value of the liability will be reflected in SG&A.



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DSU Grants During the Most Recently Completed Fiscal Year

The following table sets out the details for the fiscal year ended December 31, 2016 of all DSU grants to Directors, including DSUs
elected in lieu of cash by the Directors for semi-annual Director fees. Amounts presented do not include DSUs elected in lieu of cash for semi-annual fees earned that were not granted as of December 31, 2016.



|                  |  |                   |       |  |                                               |    |   |                                  |   |       |                 |  |     |    
|----------------- |  | ----------------- | ----- |  | --------------------------------------------- | -- | - | -------------------------------- | - | ----- | --------------- |  | --- | ---
|Name              |  | DSU Awardsgranted |       |  | % of total DSUawards granted infinancial year |    |   | Market value ondate of grantCDN$ |   |       | Expiration date
|Robert M. Beil    |  |                   | 808   |  |                                               |    | 2 | %                                |   | $     | 18.59           |  |     | n/a
|                  |  | 4,999             |       |  |                                               | 9  | % |                                  | $ | 22.83 |                 |  | n/a
|George J. Bunze   |  |                   | 3,843 |  |                                               |    | 7 | %                                |   | $     | 18.59           |  |     | n/a
|                  |  | 7,373             |       |  |                                               | 14 | % |                                  | $ | 22.83 |                 |  | n/a
|Frank Di Tomaso   |  |                   | 4,276 |  |                                               |    | 8 | %                                |   | $     | 22.83           |  |     | n/a
|Robert J. Foster  |  |                   | 2,011 |  |                                               |    | 4 | %                                |   | $     | 18.59           |  |     | n/a
|                  |  | 5,926             |       |  |                                               | 11 | % |                                  | $ | 22.83 |                 |  | n/a
|James Pantelidis  |  |                   | 4,276 |  |                                               |    | 8 | %                                |   | $     | 22.83           |  |     | n/a
|Jorge N. Quintas  |  |                   | 1,436 |  |                                               |    | 3 | %                                |   | $     | 18.59           |  |     | n/a
|                  |  | 5,549             |       |  |                                               | 11 | % |                                  | $ | 22.83 |                 |  | n/a
|Mary Pat Salomone |  |                   | 2,000 |  |                                               |    | 4 | %                                |   | $     | 18.78           |  |     | n/a
|                  |  | 4,276             |       |  |                                               | 8  | % |                                  | $ | 22.83 |                 |  | n/a
|Melbourne F. Yull |  |                   | 1,616 |  |                                               |    | 3 | %                                |   | $     | 18.59           |  |     | n/a
|                  |  | 4,276             |       |  |                                               | 8  | % |                                  | $ | 22.83 |                 |  | n/a



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Year-End Unsettled DSU Shares and Values

The following table sets out for each of the Directors the total number of unsettled DSU shares held as of December 31, 2016 and the value
of such unsettled shares at that date.



|                  |  |                                                 |        |  |                                     |  |         | 
|----------------- |  | ----------------------------------------------- | ------ |  | ----------------------------------- |  | ------- | 
|Name              |  | Number of unsettled sharesat fiscal year-end(1) |        |  | Value of unsettledshares CDN$(1)(2) | 
|Robert M. Beil    |  |                                                 | 14,556 |  |                                     |  | 366,520 | 
|George J. Bunze   |  |                                                 | 23,248 |  |                                     |  | 585,385 | 
|Frank Di Tomaso   |  |                                                 | 10,276 |  |                                     |  | 258,750 | 
|Robert J. Foster  |  |                                                 | 20,081 |  |                                     |  | 505,640 | 
|James Pantelidis  |  |                                                 | 10,276 |  |                                     |  | 258,750 | 
|Jorge N. Quintas  |  |                                                 | 17,579 |  |                                     |  | 442,639 | 
|Mary Pat Salomone |  |                                                 | 6,276  |  |                                     |  | 158,030 | 
|Melbourne F. Yull |  |                                                 | 16,956 |  |                                     |  | 426,952 | 



|(1) | Amounts presented do not include DSUs elected in lieu of cash for semi-annual directors fees earned that were not yet granted as of December 30, 2016.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The value of unvested shares is calculated using the closing price of the common shares of IPG on the TSX on December 30, 2016 (CDN$25.18).
|--- | -------------------------------------------------------------------------------------------------------------------------------------------

The following table sets out for each of the Directors the total number of DSUs elected in lieu of cash for semi-annual directors fees
earned that were not yet granted as of December 31, 2016.



|                  |  |                                               |       |  |                                                           |  |        | 
|----------------- |  | --------------------------------------------- | ----- |  | --------------------------------------------------------- |  | ------ | 
|Name              |  | Number of DSUs not yetgranted at 12/31/16 (1) |       |  | Fees Earned forwhich DSUs wereelected in lieu ofcash CDN$ | 
|Robert M. Beil    |  |                                               | 859   |  |                                                           |  | 21,529 | 
|George J. Bunze   |  |                                               | 3,014 |  |                                                           |  | 75,517 | 
|Frank Di Tomaso   |  |                                               |      |  |                                                           |  |       | 
|Robert J. Foster  |  |                                               | 1,850 |  |                                                           |  | 46,370 | 
|James Pantelidis  |  |                                               |      |  |                                                           |  |       | 
|Jorge N. Quintas  |  |                                               | 1,507 |  |                                                           |  | 37,759 | 
|Mary Pat Salomone |  |                                               |      |  |                                                           |  |       | 
|Melbourne F. Yull |  |                                               |      |  |                                                           |  |       | 



|(1) | Estimated DSUs to be granted in lieu of cash for semi-annual directors fee earned based on five-day volume weighted average of the closing price of the common shares of IPG
on the TSX on December 30, 2016 (CDN$25.05).
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Pension and Other Post Retirement Benefit Plans

Melbourne F. Yull was Chairman of the Board of Directors and Chief Executive Officer of the Company from January 11, 1995 to June 14,
2006. Prior thereto, Mr. Yull was the President and a Director of the Company or a predecessor thereof, from 1981. The former employment agreement entered into between the Company and Mr. Yull provides that Mr. Yull receive from the
Company a defined benefit supplementary pension annually for life in an amount equal to 2% of the average of Mr. Yulls annual gross salary for the final five years of his employment with the Company, multiplied by his years of service
with the Company to retirement. Accordingly, Mr. Yull receives a pension from the Company in an amount of $260,935per year.

Clawback Policy

In April
2014, the Board of Directors adopted a clawback policy, pursuant to which the Company will recoup from executive officers or employees and its subsidiaries, as the case may be, annual incentive bonuses, special bonuses, other incentive
compensation and equity-based awards, whether vested or unvested, paid, issued or granted to them, in the event of fraud, restatement of the Companys financial results, material errors or omissions in the Companys financial statements,
or other events as may be determined from time to time by the Board of Directors in its discretion. To date, the Company has not been required to apply the clawback policy.



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|C. | BOARD PRACTICES
|-- | ---------------

Term

The Company has nine Directors. Each Director is elected for a term of one year and may be nominated for
re-election at the Companys following annual shareholders meeting. The next annual shareholders meeting is scheduled to be held onJune 7, 2017, at which time the current term of
each Director will expire.

Human Resources and Compensation Committee

The Human Resources and Compensation Committee is appointed by the Board and is currently composed of four directors, Robert M. Beil
(Chairman), Robert J. Foster, Jorge N. Quintas and Mary Pat Salomone, none of whom is or has been at any previous time an employee of the Company or any of its subsidiaries. Each of the Human Resources and Compensation Committee members is
independent as that term is defined by the TSX and Sarbanes-Oxley Act.

Mr. Beil joined the Dow Chemical Company in 1975 after
graduating from Youngstown State University with a BA Degree in Industrial Marketing. During a thirty-two-year career with Dow, Mr. Beil held numerous sales and
marketing executive positions, where he had responsibility for the implementation of company compensation schemes for large organizations. In addition, he spent a portion of his career working in Dows Human Resources function, which was
responsible for compensation design for Dow, a Fortune 500 company.

Mr. Foster graduated from Queens University with an MA in
Economics, earning his CFA, then managed the research department and worked in corporate finance at one of the major investment dealers in Canada. He founded and serves as President and Chief Executive Officer of Capital Canada Limited, a boutique
investment banking firm. He serves on a number of not-for-profit boards and was on the board and audit committee of CHC Helicopters Corporation and Golf Town Income
Trust.

Mr. Quintas graduated in Management at INP-Lisbon and initialized his professional
career in ALCAN (England). Later he became a Board Member in several industrial companies from power and telecommunication cable production to optic fibers. He was a Board Member at Portgás, a city gas distributor in Portugal. Presently
Mr. Quintas is the Chairman of Nelson Quintas Group in Portugal and Board Member of: ECODEAL- dangerous waste recycling plant, NQT- Telecommunication Network in Rio de Janeiro (Brasil) and Audit Committee
of Serralves Foundation.

Ms. Salomone graduated from Baldwin Wallace College with a Masters of Business Administration and from
Youngstown State University with a Bachelor of Engineering in Civil Engineering. Ms. Salomone is a Director of TransCanada Corporation and TransCanada Pipelines Limited since 2013 where she serves on the Human Resources Committee and the
Health, Safety and Environment Committee. Ms. Salomone is also a Director of Herc Holdings, Inc (equipment rental company) since 2016. She is the chairperson of the Compensation Committee, as well as a member of the Nominating and Governance
Committee at Herc Holdings. Ms. Salomone was the Senior Vice President and Chief Operating Officer of The Babcock & Wilcox Company (B&W) (power generation company) from January 2010 to June 2013. Ms. Salomone
serves as a trustee of the Youngstown State University Foundation.

The mandate of the Human Resources and Compensation Committee consists
of ensuring the direction and implementation of the Companys wage and compensation plans, policies, and programs, and in ensuring that a succession plan is put in place to deal with the Companys future needs regarding human resources,
with respect to the Chief Executive Officer and other key executives.

The Human Resources and Compensation Committee Charter is included
as Exhibit 15.2 to this Form 20-F.



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##### Table of Contents

Audit Committee

The Audit Committee is appointed by the Board and is currently composed of four Directors, Frank Di Tomaso (Chairman), Robert J. Foster, James
Pantelidis, and Mary Pat Salomone. Each of the Audit Committee members is independent and financially literate as such terms are defined by Canadian Multilateral Instrument 52-110-Audit Committees.

Mr. Di Tomaso graduated from Concordia University with a Bachelor of Commerce in Accountingand is a Chartered Professional
Accountant, a Fellow CPA, FCA and an ICD.D.Mr. Di Tomaso has over 45 years of experience in accounting and auditing. Mr. Di Tomaso was a Partner and Advisory Partner from 1981 until 2012 and served as Director and Member of the
Management Committee from 2000 to 2009, of Raymond Chabot Grant Thornton, and previously served as a Director and Chair of the Audit Committee at Yorbeau Resources, Inc. Mr. Di Tomaso currently serves as Director and Chair of the Audit
Committee of ADF Group Inc., and Birks Group Inc. He is also a Director of National Bank Trust, National Bank Life Assurance Company and Laurentian Pilotage Authority.

For Mr. Fosters professional experience, please see above under Human Resources and Compensation Committee.

Mr. Pantelidis graduated from McGill University with a Bachelor of Science degree and a Master of Business Administration.
Mr. Pantelidis has over 30 years of experience in the petroleum industry. Mr. Pantelidis is Chairman of the Board of Parkland Fuel Corporation and has served as a director of Parkland Fuel Corporation since 1999. Mr. Pantelidis is
Chairman and Director of EnerCare Inc. since 2002. Mr. Pantelidis served on the Board of each of RONA Inc. (Chairman of the Human Resources) from 2004 to 2016 and Industrial Alliance Insurance and Financial Services Inc. (Chairman of the
Investment Committee and member of Human Resources and Compensation Committee) from 2002 to 2016. From 2002 to 2006, Mr. Pantelidis was on the board of FisherCast Global Corporation and served as Chairman and Chief Executive Officer from 2004
to 2006. From 2002 to 2004, Mr. Pantelidis was President of J.P. & Associates, a strategic consulting group. Between 1999 and 2001, Mr. Pantelidis served as Chairman and Chief Executive Officer for the Bata International Organization.

For Ms. Salomones professional experience, please see above under Human Resources and Compensation Committee.

The Audit Committee fulfills applicable public corporation obligations required of audit committees and assists the Board in fulfilling its
oversight responsibilities. The Audit Committee examines the financial reporting processes, internal controls, financial risk management and the audit process and procedures applied by the Company and makes recommendations to the Board in connection
with the nomination of the external auditor.

The Audit Committees Charter is included as Exhibit 15.3 to this Form 20-F.



| | D. | EMPLOYEES
| | -- | ---------

As of December 31, 2016, the Company had 2,218
total employees; 384in Canada, 1,487 in the US, 80 in Portugal, 8 in the rest of Europe, 4 in Mexico,and 255 in India. As of December 31, 2016, 433held either sales-related, administrative, information technology or
research and development positions and1,785 were employed in operations. Approximately 151 hourly employees at the Companys Marysville plant are unionized and subject to a collective bargaining agreement which expires on April 30,
2018. Approximately 203 hourly employees at the Companys Menasha plant are unionized and subject to a collective bargaining agreement that expires on July 31, 2018. Approximately 114 hourly employees at the Companys Carbondale plant
are unionized and subject to a collective bargaining agreement that expires on March 4, 2021. Approximately 17 hourly employees at the Companys Delta, British Columbia plant are unionized and subject to a collective bargaining agreement
that is scheduled to expire on March 31, 2019. Other than the strike at its Brantford, Ontario plant, which was closed in the second quarter of 2011, the Company has never experienced a work stoppage and it considers its employee relations to
be satisfactory. The Company does not employ a significant number of temporary employees.

As of December 31, 2015, the Company had
1,970 total employees; 382 in Canada, 1,517 in the US, 61 in Portugal, and 4 in Mexico and 6 in the rest of Europe. As of December 31, 2015, 424 held either sales-related, administrative, information technology or research and development
positions and 1,546 were employed in operations. As of December 31, 2014, the Company had 1,896 total employees; 369 in Canada, 1,446 in the US, 67 in Portugal, and 7 in Mexico and 7 in the rest of Europe. As of December 31, 2014, 2014,
387 held either sales-related, administrative, information technology or research and development positions and 1,509 were employed in operations.



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| | E. | SHARE OWNERSHIP
| | -- | ---------------

The following table sets out for each of the Directors and members of
senior management the number of shares of the Company owned or controlled by each, as of March 9, 2017.



|                  |  |                       |  |                       
|----------------- |  | --------------------- |  | ----------------------
|Name              |  | Number ofShares Owned |  | % of SharesOutstanding
|Robert M. Beil    |  | 46,493                |  | 0.08%                 
|George J. Bunze   |  | 53,371                |  | 0.09%                 
|Frank Di Tomaso   |  | 10,000                |  | 0.02%                 
|Robert J. Foster  |  | 56,100                |  | 0.09%                 
|James Pantelidis  |  | 10,000                |  | 0.02%                 
|Jorge N. Quintas  |  | 48,008                |  | 0.08%                 
|Mary Pat Salomone |  |                      |  |                      
|Melbourne F. Yull |  | 1,835,829             |  | 3.11%                 
|Gregory A.C. Yull |  | 702,214               |  | 1.19%                 
|Jeffrey Crystal   |  | 5,092                 |  | 0.01%                 
|Douglas Nalette   |  | 141,142               |  | 0.24%                 
|Shawn Nelson      |  | 143,136               |  | 0.24%                 
|Joseph Tocci      |  | 63,252                |  | 0.11%                 

Directors who are not executive officers of the Company are required to own a minimum of 10,000 shares within
five years of joining the Board of Directors in order to remain eligible for future grants of DSUs. On February 3, 2016, the Board determined that DSUs will be included in determining whether the minimum share ownership requirements have been
satisfied, on the basis that each DSU is equivalent to one common share for purposes of such determination. As of March 9, 2017, all of the eight directors who are not executive officers of the Company are in compliance with the share ownership
requirement with the exception of Mary Pat Salomone, who was appointed to the Board of Directors on November 30, 2015 and has until November 30, 2020 to satisfy the minimum share ownership requirement.

The Board of Directors has determined that the Companys minimum share ownership requirement shall apply to the CEO, CFO and all the
Companys other NEOs as identified in the Companys management information circular. The three NEOs are currently Douglas Nalette, Shawn Nelson and Joseph Tocci. The Board of Directors has further determined that, for the CEO, the minimum
share ownership requirement is shares having a value equal to at least two times his annual salary, and for the CFO and the three other NEOs, the minimum share ownership requirement is shares having a value equal to at least one time their
respective annual salaries, with such share ownership requirement to be satisfied not later than five years from the later of May 11, 2015 and the date of hiring of the executive.

The Board of Directors has also adopted a policy of once met always met and a review process every three years. Specifically, if
an executive satisfies the minimum share ownership requirement, he or she will continue to satisfy the minimum requirement notwithstanding a subsequent decrease in the value of shares held due to market conditions. Further, the Human Resources and
Compensation Committee will review every three years whether an executive will be required to purchase additional shares to satisfy the minimum share ownership requirement, including as a result of an increase in compensation. If the Human Resources
and Compensation Committee determines that an additional purchase of shares is required, the executive will have one year in which to do so.

As of March 9, 2017, the CEO and the NEOs, other than the CFO, are in compliance with the minimum share ownership requirement while the
CFO has until May 11, 2020 to comply.

As of March 9, 2017, the Directors and senior management owned an aggregate of 3,114,637
common shares of the Company, being 5.3% of the issued and outstanding common shares of the Company. The common shares held by the Directors and senior management do not have different voting rights from those held by the other shareholders of the
Company.

Please see the heading Executive Stock Option Plan above in this section for a description of the Companys
Amended Executive Stock Option Plan.



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##### Table of Contents

The following table sets forth all vested and unvested outstanding options granted to the
Companys Directors and senior management through March 9, 2017:



|                  |  |                              |                     |  |                              |  |                 |                           |  |                            
|----------------- |  | ---------------------------- | ------------------- |  | ---------------------------- |  | --------------- | ------------------------- |  | ---------------------------
|Name              |  | Number of optionsoutstanding |                     |  | Exercise price ofoptionsCDN$ |  |                 | Expiration date ofoptions
|Robert M. Beil    |  |                              | 10,00010,000        |  |                              |  | 1.5512.04       |                           |  | 6/7/20176/5/2019           
|George J. Bunze   |  |                              | 5,00010,000         |  |                              |  | 1.5512.04       |                           |  | 6/7/20176/5/2019           
|Frank Di Tomaso   |  |                              |                    |  |                              |  |                |                           |  | n/a                        
|Robert J. Foster  |  |                              | 10,000              |  |                              |  | 12.04           |                           |  | 6/5/2019                   
|James Pantelidis  |  |                              | 10,000              |  |                              |  | 12.04           |                           |  | 6/5/2019                   
|Jorge N. Quintas  |  |                              | 2,500               |  |                              |  | 12.04           |                           |  | 6/5/2019                   
|Mary Pat Salomone |  |                              |                    |  |                              |  |                |                           |  | n/a                        
|Melbourne F. Yull |  |                              | 10,00010,000        |  |                              |  | 1.5512.04       |                           |  | 6/7/20176/5/2019           
|Gregory A.C. Yull |  |                              | 265,000160,000      |  |                              |  | 12.0412.55      |                           |  | 6/5/20233/17/2024          
|Jeffrey Crystal   |  |                              | 32,500              |  |                              |  | 12.14           |                           |  | 5/13/2020                  
|Douglas Nalette   |  |                              | 50,00032,500        |  |                              |  | 12.0412.55      |                           |  | 6/5/20193/17/2020          
|Shawn Nelson      |  |                              | 50,00050,000
32,500 |  |                              |  | 1.8012.04
12.55 |                           |  | 6/27/20176/5/2019
3/17/2020
|Joseph Tocci      |  |                              | 12,50050,000
20,000 |  |                              |  | 1.8012.04
12.55 |                           |  | 6/27/20176/5/2019
3/17/2020



|Item 7: | Major Shareholders and Related Party Transactions
|------- | -------------------------------------------------



| | A. | MAJOR SHAREHOLDERS
| | -- | ------------------

As of March 9, 2017, to the knowledge of the Company, the
following are the only persons who beneficially own, or exercise control or direction over, more than 5% of the issued and outstanding common shares of the Company (Major Shareholders). Also provided below is a three-year history of
their stock ownership:



|                                           |  |                 |                     |   |                 |  |                   |                 |  |  |                   |  
|------------------------------------------ |  | --------------- | ------------------- | - | --------------- |  | ----------------- | --------------- |  |  | ----------------- | -
|Name and place of residence                |  | # / %12/31/2016 |                     |   | # / %12/31/2015 |  |                   | # / %12/31/2014 | 
|FMR, LLC
Boston, Massachusetts             |  |                 | 4,734,907(1) / 8.02 | % |                 |  | 8,193,799 / 13.97 |                 |  |  | 6,675,400 / 11.05 |  
|Fiera Capital Corporation
Montreal, Quebec |  |                 | 3,399,616(2) / 5.59 | % |                 |  | 1,720,401 / 2.93  | %               |  |  | 1,400,000 / 2.32  | %



|(1) | Based on report dated February 13, 2017 filed by FMR LLC with the SEC.
|--- | ----------------------------------------------------------------------

|(2) | Based on Nasdaq Global Intelligence report as of February 2017.
|--- | ---------------------------------------------------------------

The Major Shareholders of the
Company do not have any voting rights that differ from the other shareholders of the Company.

As of December 31, 2016, the number of
record holders is as follows: 11,497 in Canada, 868 in the United States and 243 elsewhere. Of the 59,060,335 common shares issued and outstanding on December 31, 2016, such record holders hold 23,624,134 shares in the United States, 31,301,978
shares in Canada and 4,134,223 shares elsewhere, equaling 40%, 53% and 7%, respectively.



87



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The Company is not directly or indirectly owned or controlled by another corporation, by any
foreign government or by any natural or legal person. There are no arrangements known to the Company that could result at a subsequent date in a change of control of the Company.



| | B. | RELATED PARTY TRANSACTIONS
| | -- | --------------------------

To the knowledge of the Company, for the period from the
beginning of 2016, none of its directors or officers or any person who beneficially owns or exercises control or direction over shares carrying more than ten percent of the voting rights attached to the Companys shares, any associate or
affiliate of any such person, or any close member of any such persons family, has any material interest in any transaction since the beginning of the last completed financial year or in any proposed transactions that has materially affected or
will materially affect the Company or any of its affiliates.



| | C. | INTERESTS OF EXPERTS AND COUNSEL
| | -- | --------------------------------

Not Applicable.



|Item 8: | Financial Information
|------- | ---------------------

IPGs consolidated financial statements have been prepared
in accordance with International Financial Reporting Standards.



| | A. | CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION
| | -- | -------------------------------------------------------

The Consolidated Financial
Statements of IPG for the years ended December 31, 2016, 2015, and 2014 include the following:



| |  |  | Managements Responsibility for Financial Statements
| | - |  | ----------------------------------------------------



| |  |  | Managements Report on Internal Control over Financial Reporting
| | - |  | ----------------------------------------------------------------



| |  |  | Independent Auditors Report of Registered Public Accounting Firm
| | - |  | -----------------------------------------------------------------



| |  |  | Independent Auditors Report of Registered Public Accounting Firm on Internal Control over Financial Reporting
| | - |  | --------------------------------------------------------------------------------------------------------------



| |  |  | Consolidated Financial Statements
| | - |  | ---------------------------------



| |  |  | Consolidated Earnings
| | - |  | ---------------------



| |  |  | Consolidated Comprehensive Income
| | - |  | ---------------------------------



| |  |  | Consolidated Changes in Equity
| | - |  | ------------------------------



| |  |  | Consolidated Cash Flows
| | - |  | -----------------------



| |  |  | Consolidated Balance Sheets
| | - |  | ---------------------------



| |  |  | Notes to Consolidated Financial Statements
| | - |  | ------------------------------------------



88



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Legal or Arbitration Proceedings

On July 3, 2014, the Company was informed of a complaint filed on June 27, 2014 by its former Chief Financial Officer with the
Occupational Safety and Health Administration of the US Department of Labor (OSHA) alleging certain violations by the Company related to the terms of his employment and his termination. The Company aggressively contested the allegations
and, it believes, demonstrated that the former Chief Financial Officers assertions were without merit.

In a letter dated
July 16, 2015, OSHA informed the Company that the former Chief Financial Officer had withdrawn his OSHA complaint in order to file a complaint against the Company in U.S. federal district court. The withdrawal occurred prior to any
determination by OSHA regarding the complaint.

On November 5, 2015, the former Chief Financial Officer filed a lawsuit in the United
States District Court for the Middle District of Florida. The lawsuit was premised on essentially the same facts and made essentially the same allegations as asserted in his OSHA complaint; the lawsuit sought unspecified damages and a trial by jury.
On October 20, 2016, the Company and the former Chief Financial Officer agreed to a settlement of the outstanding litigation. Pursuant to the terms of the confidential settlement agreement, the Company paid $1.9 million for full and
complete settlement of all matters between the parties with respect to the litigation.

The Company is engaged from time-to-time in various legal proceedings and claims that have arisen in the ordinary course of business. The outcome of all of the proceedings and claims against the Company
is subject to future resolution, including the uncertainties of litigation. Based on information currently known to the Company and after consultation with outside legal counsel, management believes that the probable ultimate resolution of any such
proceedings and claims, individually, or in the aggregate, will not have a material adverse effect on the financial condition of the Company, taken as a whole, and accordingly, no amounts have been recorded as of December 31, 2016.

Dividends

The Board of
Directors of the Company adopted a Dividend Policy on August 14, 2012 providing for semi-annual dividend payments. On August 14, 2013, the Board of Directors modified the Companys dividend policy to provide for quarterly dividend
payments. On July 7, 2014, the Board of Directors further modified the Companys dividend policy to increase the annualized dividend by 50% from $0.32 to $0.48 per common share. On August 12, 2015, the Board of Directors of the
Company amended the quarterly dividend policy to increase the annualized dividend from $0.48 to $0.52 per share. On August 10, 2016, the Board of Directors amended the Companys the dividend policy by increasing the annualized dividend by
7.7% from $0.52 to $0.56 per share. So long as the payments do not result in a violation of the Companys covenants with its lenders, and subject to the provisions of the Canada Business Corporations Act relating to the declaration and payment
of dividends, there are no other restrictions that would prevent the Company from paying dividends. The following table sets forth the dividends paid as of December 31, 2016:



|                    |  |               |            |  |             |  |            |           |  |  |                  |  |  |  |           | 
|------------------- |  | ------------- | ---------- |  | ----------- |  | ---------- | --------- |  |  | ---------------- |  |  |  | --------- | 
|                    |  | Date Declared |            |  | Record Date |  |            | Date Paid |  |  | Amount per Share | 
|Dividends per Share |  |               |            |  |             |  |            |           |  |  |                  |  |  |  |           | 
|                    |  |               | 2/6/2014   |  |             |  | 3/19/2014  |           |  |  | 3/31/2014        |  |  |  | USD $0.08 | 
|                    |  |               | 5/7/2014   |  |             |  | 6/17/2014  |           |  |  | 6/30/2014        |  |  |  | USD $0.08 | 
|                    |  |               | 8/5/2014   |  |             |  | 9/15/2014  |           |  |  | 9/30/2014        |  |  |  | USD $0.12 | 
|                    |  |               | 11/4/2014  |  |             |  | 12/15/2014 |           |  |  | 12/31/2014       |  |  |  | USD $0.12 | 
|                    |  |               | 3/9/2015   |  |             |  | 3/19/2015  |           |  |  | 3/31/2015        |  |  |  | USD $0.12 | 
|                    |  |               | 5/11/2015  |  |             |  | 6/15/2015  |           |  |  | 6/30/2015        |  |  |  | USD $0.12 | 
|                    |  |               | 8/12/2015  |  |             |  | 9/15/2015  |           |  |  | 9/30/2015        |  |  |  | USD $0.13 | 
|                    |  |               | 11/11/2015 |  |             |  | 12/15/2015 |           |  |  | 12/31/2015       |  |  |  | USD $0.13 | 
|                    |  |               | 3/9/2016   |  |             |  | 3/21/2016  |           |  |  | 3/31/2016        |  |  |  | USD $0.13 | 
|                    |  |               | 5/9/2016   |  |             |  | 6/15/2016  |           |  |  | 6/30/2016        |  |  |  | USD $0.13 | 
|                    |  |               | 8/10/2016  |  |             |  | 9/15/2016  |           |  |  | 9/30/2016        |  |  |  | USD $0.14 | 
|                    |  |               | 11/10/2016 |  |             |  | 12/15/2016 |           |  |  | 12/30/2016       |  |  |  | USD $0.14 | 



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The Company has determined it is appropriate to declare its dividend in US dollars because most
of its cash flows are in US dollars. The Company has paid no other dividend in the past three years other than as set forth above. For details regarding the Companys covenants with its lenders please refer to the Credit Facility Agreement, as
amended, filed as Exhibit 4.6 to this Form 20-F.



| | B. | SIGNIFICANT CHANGES
| | -- | -------------------

On February 17, 2017, the Board of
Directors approved amendments to the PSU Plan and DSU Plan to provide for only cash settlement of PSU and DSU awards, respectively. As a result of the amendments, prospectively and until award settlement, the Company will remeasure the fair value of
the awards at each reporting period end date and present the cash-settled awards as a liability within other liabilities and not in contributed surplus in the consolidated balance sheets. Changes in the fair value of the liability will be reflected
in SG&A.

No other significant changes have occurred since the date of the annual financial statements.



|Item 9: | The Offer and Listing
|------- | ---------------------



| | A. | OFFER AND LISTING DETAILS
| | -- | -------------------------

The following table sets forth the
reporting of the high and low prices for IPG shares on the TSX for the periods indicated. Also set forth below are the high and low prices for IPG shares on OTC Pink Marketplace.



|     |                |                |       |                               |       |                      |       |       |       |      
|---- | -------------- | -------------- | ----- | ----------------------------- | ----- | -------------------- | ----- | ----- | ----- | -----
|Year |                | Period         |       | Toronto Stock Exchange (CDN$) |       | OTC Pink Marketplace
|     |                | High           |       | Low                           |       | High                 |       | Low  
|2011 |                | Annual         |       | 3.39                          |       | 1.02                 |       | 3.30  |       | 1.04 
|2012 |                | Annual         |       | 9.07                          |       | 3.12                 |       | 9.17  |       | 3.08 
|2013 |                | Annual         |       | 15.62                         |       | 7.96                 |       | 15.20 |       | 8.09 
|2014 |                | Annual         |       | 19.95                         |       | 11.12                |       | 17.36 |       | 10.10
|2015 |                | Annual         |       | 20.51                         |       | 13.67                |       | 16.65 |       | 10.30
|2016 |                | Annual         |       | 25.74                         |       | 15.46                |       | 19.25 |       | 11.19
|     |                |                |       |                               |      
|2014 |                | First Quarter  |       | 14.05                         |       | 11.12                |       | 13.23 |       | 10.10
|     | Second Quarter |                | 13.21 |                               | 11.50 |                      | 11.96 |       | 10.73
|     | Third Quarter  |                | 16.37 |                               | 11.84 |                      | 14.82 |       | 11.24
|     | Fourth Quarter |                | 19.95 |                               | 14.53 |                      | 17.36 |       | 12.89
|     |                |                |       |                               |      
|2015 |                | First Quarter  |       | 20.51                         |       | 16.74                |       | 16.41 |       | 13.43
|     |                | Second Quarter |       | 20.31                         |       | 16.21                |       | 16.65 |       | 13.60
|     |                | Third Quarter  |       | 20.21                         |       | 13.67                |       | 15.58 |       | 10.30
|     |                | Fourth Quarter |       | 19.01                         |       | 13.96                |       | 14.19 |       | 10.82
|     |                |                |       |                               |      
|2016 |                | First Quarter  |       | 18.96                         |       | 15.46                |       | 14.53 |       | 11.19
|     |                | Second Quarter |       | 21.75                         |       | 18.09                |       | 16.68 |       | 13.97
|     |                | Third Quarter  |       | 23.72                         |       | 20.06                |       | 17.99 |       | 15.35
|     |                | Fourth Quarter |       | 25.74                         |       | 20.51                |       | 19.25 |       | 15.25
|     |                |                |       |                               |      
|2016 |                | September      |       | 23.72                         |       | 21.67                |       | 17.99 |       | 16.61
|     |                | October        |       | 23.60                         |       | 21.53                |       | 17.50 |       | 16.23
|     |                | November       |       | 24.84                         |       | 20.51                |       | 18.30 |       | 15.25
|     |                | December       |       | 25.74                         |       | 23.22                |       | 19.25 |       | 17.19
|     |                |                |       |                               |      
|2017 |                | January        |       | 25.06                         |       | 23.50                |       | 18.57 |       | 18.00
|     |                | February       |       | 24.91                         |       | 21.68                |       | 19.11 |       | 16.43



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IPG has authorized an unlimited number of voting common shares without par value. The Company
also has authorized an unlimited number of non-voting Class A preferred shares issuable in a series, ranking in priority to the common shares with respect to dividends and return of capital on
dissolution. The Board of Directors is authorized to fix, before issuance, the designation, rights, privileges, restrictions and conditions attached to the shares of each series of Class A preferred shares. As of December 31, 2016, there
were 58,667,535 issued and outstanding common shares and no issued and outstanding preferred shares of the Company.



| | B. | PLAN OF DISTRIBUTION
| | -- | --------------------

Not Applicable.



| | C. | MARKETS
| | -- | -------

The Companys common shares are traded on the
TSX under the symbol ITP. The Companys common shares are traded in the US on the OTC Pink Marketplace.



| | D. | SELLING SHAREHOLDERS
| | -- | --------------------

Not Applicable.



| | E. | DILUTION
| | -- | --------

Not Applicable.



| | F. | EXPENSES OF THE ISSUE
| | -- | ---------------------

Not Applicable.



|Item 10: | Additional Information
|-------- | ----------------------



| | A. | SHARE CAPITAL
| | -- | -------------

Not Applicable.



| | B. | MEMORANDUM AND ARTICLES OF ASSOCIATION
| | -- | --------------------------------------

1.    The business of IPG was established when Intertape Systems Inc., a predecessor of the Company, established a
pressure-sensitive tape manufacturing facility in Montreal. The Company was incorporated under the Canada Business Corporations Act (the Act) on December 22, 1989 under the name 171695 Canada Inc. On October 8,
1991, the Company filed a Certificate of Amendment changing its name to Intertape Polymer Group Inc. A Certificate of Amalgamation was filed by the Company on August 31, 1993, at which time the Company was amalgamated with EBAC
Holdings Inc.

On November 11, 2015, the Board of Directors adopted a new By-Law 2015-1, requiring advance notice for the nomination of directors.

2.    The
Directors of the Company may, when deemed expedient:



| | (a) | borrow money upon the credit of the Company;
| | --- | --------------------------------------------



| | (b) | issue debentures or other securities of the Company, and pledge or sell the same for such sums and at such prices as may be deemed expedient;
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | notwithstanding the provisions of the Civil Code, hypothecate, mortgage or pledge the moveable or immoveable property, present or future, of the Company, to secure any such debentures, or other securities, or give part
only of such guarantee for such purposes; and constitute the hypothec, mortgage or pledge above mentioned, by trust deed, or on any other manner; and
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | (d) | mortgage, hypothecate, pledge or otherwise create a security interest in all or any moveable or personal, immoveable or real or other property of the Company, owned or subsequently acquired, to secure any obligation of
the Company.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The directors may, by resolution or by-law, delegate the above listed
powers to such officers or directors of the Company as set out in such resolution or by-law.

Section 13 of the By-laws allows the Board of Directors to determine the remuneration paid to
directors and such remuneration shall be in addition to the salary paid to any officer of the Company who is also a member of the Board of Directors (in the Boards discretion, it does not currently pay any director remuneration to Gregory A.C.
Yull in addition to the compensation paid to him as an officer of the Company). The Directors may also by resolution award special remuneration to any Director undertaking any special services on the Companys behalf other than the routine work
ordinarily required of a Director by the Company. The confirmation of any such resolution or resolutions by the shareholders is not required.

3.    Description of Share Capital

The authorized capital of the Company consists of an unlimited number of common shares and non-voting
Class A preferred shares, issuable in series. The following is a summary of the material provisions which attach to the common shares and Class A preferred shares, and is qualified by reference to the full text of the rights, privileges,
restrictions and conditions of such shares.

Common Shares

Voting Rights  Each common share entitles the holder thereof to one vote at all meetings of the shareholders of the Company.

Payment of Dividends  The holders of the Companys common shares are entitled to receive during each year, as and when declared by
the Board of Directors, dividends payable in money, property or by issue of fully-paid shares of the capital of the Company.

Distribution
of Assets Upon Winding-Up  In the event of the liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, or other distribution of
assets of the Company among shareholders for the purpose of winding-up its affairs, the holders of the Companys common shares are entitled to receive the remaining property of the Company.

Class A Preferred Shares

The Board of Directors may at any time and from time to time issue non-voting Class A preferred
shares in one or more series, each series to consist of such number of shares, designation, rights, restrictions, conditions and limitations (including any sinking fund provisions) as may, before the issuance thereof, be determined by the Board of
Directors. The Class A preferred shares are entitled to preference over the common shares with respect to the payment of dividends. In the event of the liquidation, dissolution or winding-up of the
Company or other distribution of assets of the Company among shareholders for the purpose of winding-up its affairs, the holders of the Class A preferred shares will, before any amount is paid to, or any
property or assets of the Company distributed among, the holders of the common shares, be entitled to receive: (i) an amount equal to the amount paid-up on such shares together with, in the case of
cumulative Class A preferred shares, all unpaid cumulative dividends and, in the case of non-cumulative Class A preferred shares, all declared and unpaid
non-cumulative dividends; and (ii) if such liquidation, dissolution, winding-up or distribution is voluntary, an additional amount equal to the premium, if any,
which would have been payable on the redemption of the Class A preferred shares if they had been called for redemption by the Company on the date of distribution.

4.    The rights of the holders of the Class A preferred shares may be amended only with the prior approval of two-thirds of the holders of the Class A preferred shares in addition to any other approvals required by the Act.



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There are no preferred shares currently issued and outstanding.

5.    Subject to compliance with the Act, the annual shareholders meeting shall be convened on such day each year and at
such time as the Board of Directors may by resolution determine. Special meetings of the shareholders may be convened by order of the Chairman of the Board, the President or a Vice President who is a director or by the Board of Directors to be held
at such time and place as may be specified in such order. Special meetings of the shareholders may also be called by written request to the Board of Directors signed by shareholders holding between them not less than five percent (5%) of the
outstanding shares of the Company entitled to vote at such meeting. Such request shall state the business to be transacted at the meeting and sent to the registered office of the Company. In the event the Board of Directors does not call the meeting
within twenty-one (21) days after receiving the request, then any shareholder who signed the request may call the meeting.

6.    The Articles of Amalgamation of IPG do not contain limitations on the rights of
non-resident or foreign shareholders to hold or exercise voting rights on the Companys shares.

7.    The Articles of Amalgamation and the Bylaws contain no provision that would have an effect of delaying, deferring or
preventing a change in control of the Company and that would operate only with respect to a merger, acquisition or corporate restructuring involving the Company or any of its subsidiaries.



| | C. | MATERIAL CONTRACTS
| | -- | ------------------

The following is a description of the
material contracts the Company was a party to during the last two fiscal years ended December 31, 2016, regardless of when they were initially entered into by the Company, either directly or through one of its subsidiaries, and that are not in
the ordinary course of IPGs business:



| |  |  | an Amended Executive Stock Option Plan.For a summary of this Plan, please see Item 6.B in this 20-F. For a copy of the Executive Stock Option Plan, see Exhibit 4.1 to this
Form 20-F.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an Amended Stock Appreciation Rights Plan. For a summary of this Plan, please see Item 6.B in this 20-F. For a copy of the Stock Appreciation Rights Plan, as
amended, see Exhibit 4.2 to this Form 20-F.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an Amended Deferred Share Unit Plan. For a summary of this Plan, please see Item 6.B in this 20-F. For a copy of the Deferred Shared Unit Plan, see Exhibit 4.3 to
this Form 20-F.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an Amended Performance Share Unit Plan.For a summary of this Plan, please see Item 6.B in this 20-F. For a copy of the Performance Shared Unit Plan, see Exhibit 4.4
to this Form 20-F.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an Equipment Finance Agreement dated August 14, 2012 in the amount of up to $24.0 million (which was later increased to $25.7 million as of March 26, 2014) for qualifying US capital
expenditures during the period May 2012 through March 31, 2014. The Equipment Finance Agreement allowed for periodic scheduling of amounts with each schedule having a term of sixty months and a fixed interest rate for leases scheduled prior to
March 31, 2014. For a copy of the Equipment Finance Agreement, see Exhibit 4.5 to this Form 20-F. The Company has entered into the five schedules as listed below.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                   |  |        |              |  |              |  |      |          |  |   |                  |  |  |                
|------------------ |  | ------ | ------------ |  | ------------ |  | ---- | -------- |  | - | ---------------- |  |  | ---------------
|Date Entered       |  | Amount |              |  | InterestRate |  |      | Payments |  |   | Last Payment due
|September 27, 2012 |  | $      | 2.7 million  |  |              |  | 2.74 | %        |  | $ | 48,577           |  |  | October 1, 2017
|December 28, 2012  |  | $      | 2.6 million  |  |              |  | 2.74 | %        |  | $ | 46,258           |  |  | January 1, 2018
|June 28, 2013      |  | $      | 2.2 million  |  |              |  | 2.90 | %        |  | $ | 39,329           |  |  | July 1, 2018   
|December 31, 2013  |  | $      | 14.7 million |  |              |  | 2.90 | %        |  | $ | 263,450          |  |  | January 1, 2019
|April 1, 2014      |  | $      | 3.5 million  |  |              |  | 2.95 | %        |  | $ | 62,263           |  |  | April 1, 2019  



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| |  |  | a Revolving Credit Facility Agreement dated November 18, 2014 (and since amended on August 2, 2016, September 2, 2016 and January 26, 2017), among IPG and certain of its subsidiaries, the
Lenders referred to therein, Wells Fargo Bank, National Association as Administrative Agent, Swingline Lender and Issuing Lender, Bank of America, N.A. as Syndication Agent, and Wells Fargo Securities, LLC and Merrill Lynch, Pierce,
Fenner & Smith Incorporated as Joint Lead Arrangers and Joint Bookrunners. The Revolving Credit Facility Agreement provides for a five-year $300 million Revolving Credit Facility. The Revolving Credit Facility replaced the ABL. The
Revolving Credit Facility Agreement includes an incremental accordion feature of $150 million, which will enable the Company to increase the limit of this facility (subject to the Revolving Credit Facility Agreements terms and lender
approval) if needed. The Revolving Credit Facility matures on November 18, 2019 and bears an interest rate based primarily on the LIBOR for US dollar loans and CDOR for Canadian dollar loans plus a spread varying between 100 and 225 basis
points depending on the consolidated total leverage ratio (150basis points as of December 31, 2016, 150 basis points as of December 31, 2015 and 125 basis points on December 31, 2014). The Revolving Credit Facility Agreement
includes certain financial covenant obligations. The amount of capital expenditures in any fiscal year is limited to $100 million (prior to the January 2017 amendment, this limit was $50 million and any portion of the allowable
$50 million not expended in the year could have been carried over for expenditure in the following year but not carried over to any additional subsequent year thereafter). The consolidated total leverage ratio may not exceed 3.25 to 1.00
(subject to increase to 3.75 to 1.00 for the first four quarters following an acquisition with a price not less than $50 million), and the consolidated debt service coverage ratio may not be less than 1.50 to 1.00. The consolidated total leverage
ratio compares consolidated total indebtedness to consolidated EBITDA (as defined in the Revolving Credit Facility Agreement). The consolidated debt service coverage ratio compares consolidated EBITDA (less certain taxes and dividends), to the sum
of consolidated interest expense plus scheduled principal payments. The Revolving Credit Facility Agreement also includes certain other affirmative and negative covenants, subject to certain exceptions and limitations, including restrictions on
indebtedness, liens, investments, and distributions. Reference is made to the Revolving Credit Facility Agreement for more detailed information regarding specific covenants, defined terms and conditions. For a copy of the Revolving Credit Facility
Agreement, see Exhibit 4.6 to this Form 20-F.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Rights Plandated December 14, 2015 with CST Trust Company. The purpose of the Shareholder Rights Plan is to provide IPGs Board of Directors with additional time, in the event of an unsolicited
takeover bid, to develop and propose alternatives to the bid and negotiate with the bidder, as well as to ensure equal treatment of shareholders in the context of an acquisition of control made other than by way of an offer to all shareholders, and
lessen the pressure on shareholders to tender a bid.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

IPGs Board of Directors has implemented the Rights Plan by
authorizing the issuance of one right (a Right) in respect of each common share outstanding at the close of business on December 14, 2015 (the Record Time) and in respect of each voting share issued by IPG after the
Record Time. The Rights trade with, and are represented by, the common shares. Until such time as the Rights separate, when they become exercisable, Rights certificates will not be distributed to shareholders and no further action is required by
shareholders. If a person, or a group acting jointly or in concert (each, an Offeror), acquires beneficial ownership of 20% or more of the then outstanding voting shares (other than pursuant to an exemption available under the Rights
Plan), Rights (other than those held by such Offeror, which will become void) will separate and permit the holders thereof to purchase additional shares at a substantial discount to the market price of the shares at that time. Pursuant to the Rights
Plan, any bid that meets certain criteria intended to protect the interests of all shareholders will be deemed to be a permitted bid and will not trigger a separation under the Rights Plan. These criteria require, among other things,
that the bid be made by way of a takeover bid circular to all holders of voting shares other than the Offeror, that all shareholders be treated equally and that the bid remain open for acceptance by shareholders for at least 60 days or such longer
period as may be prescribed by law as the minimum deposit period.

Prior to separation, the Rights Plan is not dilutive and will not
affect reported earnings per share or change the way in which shareholders would otherwise trade shares. Upon separation, reported earnings per share, on a fully diluted or non-diluted basis, may be affected.
Shareholders who do not exercise their Rights upon separation may suffer substantial dilution along with the Offeror.

Under the policies
of the TSX, the Rights Plan was required to be ratified by the shareholders of the Corporation at a meeting held within six months following the adoption of the Rights Plan, failing which the Rights Plan would have been required to be immediately
cancelled and any rights issued thereunder would have been immediately redeemed or cancelled. On June 9, 2016, shareholders approved a resolution ratifying and approving the Rights Plan.



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At or prior to the annual meeting of shareholders of the Corporation in the year 2019, the Board of Directors
shall submit a resolution ratifying the continued existence of the Rights Plan to the shareholders for their consideration and, if thought desirable, approval.

For a copy of the Rights Plan, see Exhibit 2.1 to this Form 20-F.

A copy of each of the foregoing contracts, except as otherwise noted, are available as Exhibits to this Form 20-F.



| | D. | EXCHANGE CONTROLS
| | -- | -----------------

As of the date hereof, there are no governmental laws, decrees or
regulations in Canada on the export or import of capital, or which impose foreign exchange controls or affect the remittance of interest, dividends or other payments to non-resident holders of IPGs
common stock, except as described under Item 10E Taxation below.

Except as provided in the Investment Canada Act (Canada),
the Competition Act (Canada), and/or the Canada Transportation Act (Canada), which have provisions that may potentially restrict the holding of voting shares by non-Canadians, there are no limitations specific
to the rights of non-Canadians to hold or vote the Companys common shares under the laws of Canada or in its charter documents. The following summarizes the principal features of the Investment
Canada Act, the Competition Act and the Canada Transportation Act for non-Canadian residents proposing to acquire the Companys common shares.

This summary is of a general nature only and is not intended to be, and should not be construed to be, legal advice to any holder or
prospective holder of the Companys common shares, and no opinion or representation to any holder or prospective holder of the Companys common shares is hereby made. Accordingly, holders and prospective holders of the Companys
common shares should consult with their own legal advisors with respect to the consequences of purchasing and owning the Companys common shares.



| | 1. | Investment Canada Act
| | -- | ---------------------

The Investment Canada Act governs acquisitions of control of
Canadian businesses by non-Canadians. Under the Investment Canada Act, non-Canadian individuals or entities acquiring control (as defined in the
Investment Canada Act) of a corporation carrying on business in Canada are required to either notify, or file an application for review with, Innovation, Science and Economic Development Canada (or in the case of cultural businesses,
Heritage Canada), subject to certain statutory exemptions. The relevant Minister may review any transaction which constitutes an acquisition of control of a Canadian business, where certain thresholds are exceeded (which are higher for investors
from members of the World Trade Organization, including United States residents, or World Trade Organization member-controlled companies) or where the activity of the business is a cultural business (as defined in the legislation and its
regulations), or where the investment could be injurious to Canadas national security. For acquisitions of control of businesses which do not involve a cultural business or present national security issues, no change of voting control
will be deemed to have occurred, for purposes of the Investment Canada Act, if less than one-third of the voting control of a Canadian corporation is acquired by an investor. Different rules apply to
acquisitions of control of businesses related to Canadas cultural heritage or national identity, or present national security concerns.

If an investment is reviewable under the Investment Canada Act, an application for review in the form prescribed is normally required to be
filed with Innovation, Science and Economic Development Canada or Heritage Canada prior to implementation of the investment. An investment subject to review may not be implemented until the review has been completed and the Minister responsible is
satisfied that the investment is likely to be of net benefit to Canada. If the Minister is not satisfied that the investment is likely to be of net benefit to Canada, the non-Canadian cannot
implement the investment, or if the investment has been implemented, may be required to divest itself of control of the Canadian business that is the subject of the investment. Different rules apply if the Minister determines that the
investment may be injurious to Canadas national security.



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Certain transactions relating to IPGs common stock would be exempt from the Investment
Canada Act, unless they are found to be potentially injurious to Canadas national security by the Minister responsible, including:



| | (a) | the acquisition of the Companys common stock by a person in the ordinary course of that persons business as a trader or dealer in securities;
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | the acquisition of control of the Company in connection with the realization of security granted for a loan or other financial assistance and not for a purpose related to the provisions of the Investment Canada Act; and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | the acquisition of control of the Company by reason of an amalgamation, merger, consolidation or corporate reorganization following which the ultimate direct or indirect control in fact of the Company, through ownership
of the Companys common stock, remains unchanged.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

These exemptions do not apply to an acquisition of control of a
Canadian business that is deemed to be potentially injurious to Canadas national security.



| | 2. | Competition Act
| | -- | ---------------

The Competition Act requires notification to the Commissioner of
Competition of specified merger transactions that exceed certain monetary and share thresholds prior to their completion.

If a proposed
merger is subject to pre-merger notification, each party to the proposed merger must file a notification with the Commissioner of Competition.

Proposed mergers that are subject to pre-merger notification under the Competition Act are prohibited
from being completed before the end of 30 days following the receipt of a complete notification by the Commissioner of Competition, unless a waiver of the waiting period is obtained from the Commissioner of Competition. The waiting period may be
extended by the issuance of a supplementary information request by the Commissioner of Competition within the initial 30 day waiting period. In the event that a supplementary information request is issued by the Commissioner of Competition, the
parties may not complete the proposed merger until the end of a further 30 day waiting period that commences on the date on which the information requested pursuant to the supplementary information request has been provided to the Commissioner of
Competition.

Whether or not a merger is subject to pre-merger notification to the Commissioner of
Competition, the Commissioner of Competition may commence an application for relief in the Competition Tribunal on the basis that the merger prevents or lessens, or is likely to prevent or lessen, competition substantially in a relevant market. Such
applications for relief are subject to a one-year limitation period from the mergers substantial completion.



| | 3. | Canada Transportation Act
| | -- | -------------------------

If a proposed transaction involves a transportation
undertaking, and is subject to pre-merger notification to the Commissioner of Competition pursuant to the Competition Act, the parties to the proposed transaction must also provide pre-closing notification to the Minister of Transportation under the Canada Transportation Act. Such transactions require a 42 day waiting period which may be extended.

The parties to a proposed transaction subject to pre-merger notification to the Minister of
Transportation may not complete the proposed transaction unless the Minister of Transportation issues a notice of his opinion that the proposed transaction does not raise issues with respect to the public interest as it relates to national
transportation, or unless the transaction is approved by the Governor in Council.



| | E. | TAXATION
| | -- | --------

Material Canadian Federal Income Tax Consequences

The following general summary describes the principal Canadian federal income tax consequences applicable to a holder of the Companys
common stock who is a resident of the United States, who is not, will not be and will not be deemed to



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62be a resident of Canada for purposes of the Income Tax Act (Canada) (the Income Tax Act) and any applicable tax treaty and who does not use or hold, and is not deemed to use or
hold, his common stock in the capital of the Company in connection with carrying on a business in Canada (a non-resident holder). This summary applies only to
non-resident holders who hold their IPG common stock as capital property. This summary does not apply to non-resident holders who are financial institutions (within the
meaning of the Income Tax Act) or insurers.

This summary is based upon the current provisions of the Income Tax Act, the regulations
thereunder (the Regulations), the current publicly announced administrative and assessing policies of the Canada Revenue Agency and the Canada-United States Tax Convention (1980), as amended (the Treaty). This summary also
takes into account the amendments to the Income Tax Act and the Regulations publicly announced by the Minister of Finance (Canada) prior to the date hereof (the Tax Proposals) and assumes that all such Tax Proposals will be enacted in
their present form. However, no assurances can be given that the Tax Proposals will be enacted in the form proposed, or at all. This summary is not exhaustive of all possible Canadian federal income tax consequences applicable to a non-resident holder of the Companys common stock and, except for the foregoing, this summary does not take into account or anticipate any changes in law, whether by legislative, administrative or judicial
decision or action, nor does it take into account provincial, territorial or foreign income tax legislation or considerations, which may differ from the Canadian federal income tax consequences described herein.

This summary is of a general nature only and is not intended to be, and should not be construed to be, legal, business or tax advice to any
particular holder or prospective holder of IPGs common stock, and no opinion or representation with respect to the tax consequences to any holder or prospective holder of the Companys common stock is made. Accordingly, holders and
prospective holders of the Companys common stock should consult their own tax advisors with respect to the income tax consequences of purchasing, owning and disposing of IPGs common stock in their particular circumstances.

Dividends

Dividends paid on the Companys common stock to a non-resident holder will be subject under the
Income Tax Act to withholding tax which tax is deducted at source by the Company. The withholding tax rate for dividends prescribed by the Income Tax Act is 25% but this rate may be reduced under the provisions of an applicable tax treaty. Under the
Treaty, the withholding tax rate is reduced to 15% on dividends paid by the Company to a resident of the United States who is the beneficial owner of such dividend and is eligible to benefits under the Treaty. The rate is further reduced to 5% where
the beneficial owner of the dividend is a corporation resident in the United States that is eligible for benefits under the Treaty and that owns at least 10% of the voting stock of the Company.

Capital Gains

A non-resident holder is not subject to tax under the Income Tax Act in respect of a capital gain realized upon the disposition of a common share of the Company unless such share is (or is deemed to be) taxable
Canadian property (as defined in the Income Tax Act) of the non-resident holder. As long as they are listed on a designated stock exchange (which includes the TSX) at the time they are disposed of,
IPGs common stock generally will not be considered taxable Canadian property of a non-resident holder unless at any time during the 60-month period immediately
preceding the disposition of the stock: (i) the non-resident holder, persons with whom the non-resident holder does not deal at arms length or the non-resident holder together with such non-arms length persons owned, or had an interest in an option in respect of, 25% or more of the issued stock of any class or
series of the Companys capital stock; and (ii) more than 50% of the fair market value of the shares of the Company was derived directly or indirectly from one or any combination of real or immovable property situated in Canada, Canadian
resource properties (as defined in the Income Tax Act), timber resource properties (as defined in the Income Tax Act), or an option, an interest or right in such property.

Material United States Federal Income Tax Consequences

The following is a general discussion of the material United States federal income tax consequences, under current law, generally applicable to
a US Holder (as hereinafter defined) of common shares of the Company. This discussion does not address individual consequences to persons subject to special provisions of federal income tax law, such as those described below as excluded from the
definition of a US Holder. In addition, this discussion does not cover any state, local or foreign tax consequences. (See Canadian Federal Tax Consequences).



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The following discussion is based upon the sections of the Internal Revenue Code of 1986, as amended (the
Code), Treasury Regulations, published Internal Revenue Service (IRS) rulings, published administrative positions of the IRS and court decisions that are currently applicable, any or all of which could be materially and
adversely changed, possibly on a retroactive basis, at any time. This discussion does not consider the potential effects, both adverse and beneficial, of any recently proposed legislation which, if enacted, could be applied, possibly on a
retroactive basis, at any time. This discussion is for general information only and it is not intended to be, nor should it be construed to be, legal or tax advice to any holder or prospective holder of common shares of the Company and no opinion or
representation with respect to the United States federal income tax consequences to any such holder or prospective holder is made. Accordingly, holders and prospective holders of common shares of the Company are urged to consult their own tax
advisors about the federal, state, local, and foreign tax consequences of purchasing, owning and disposing of common shares of the Company.

US Holders

As used
herein, a US Holder means a holder of common shares of the Company who is a citizen or individual resident of the United States, a corporation or partnership created or organized in or under the laws of the United States or of any
political subdivision thereof or a trust whose income is taxable in the United States irrespective of source.

This summary does not
address the tax consequences to, and US Holder does not include, persons subject to specific provisions of federal income tax law, such as tax-exempt organizations, qualified retirement plans, individual
retirement accounts and other tax-deferred accounts, financial institutions, insurance companies, real estate investment trusts, regulated investment companies, broker-dealers,
non-resident alien individuals, persons or entities that have a functional currency other than the US dollar, shareholders who hold common shares as part of a straddle, hedging or a conversion
transaction, and shareholders who acquired their common shares through the exercise of employee stock options or otherwise as compensation for services. This summary is limited to US Holders who own common shares as capital assets. This summary does
not address the consequences to a person or entity holding an interest in a shareholder or the consequences to a person of the ownership, exercise or disposition of any options, warrants or other rights to acquire common shares.

Distribution on Common Shares of the Company

US Holders receiving dividend distributions (including constructive dividends) with respect to common shares of the Company are required to
include in gross income for United States federal income tax purposes the gross amount of such distributions equal to the US dollar value of such dividends on the date of receipt (based on the exchange rate on such date) to the extent that the
Company has current or accumulated earnings and profits, without reduction for any Canadian income tax withheld from such distributions. Such Canadian tax withheld may be credited, subject to certain limitations, against the US Holders federal
income tax liability or, alternatively, may be deducted in computing the US Holders federal taxable income by those who itemize deductions. (See more detailed discussion at Foreign Tax Credit below). To the extent that
distributions exceed current or accumulated earnings and profits of the Company, they will be treated first as a return of capital up to the US Holders adjusted basis in the common shares and thereafter as gain from the sale or exchange of the
common shares. Preferential tax rates for long-term capital gains are applicable to a US Holder which is an individual, estate or trust. There are currently no preferential tax rates for long-term capital gains for a US Holder which is a
corporation. Section 1411 of the Internal Revenue Code imposes a 3.8% Medicare surtax on net investment income of certain individuals, estates and trusts. In general, income with respect to Company distributions will be considered investment
income for purposes of the surtax.

Foreign Tax Credit

A US Holder who pays (or has withheld from distributions) Canadian income tax with respect to the ownership of common shares of the Company may
be entitled, at the option of the US Holder, to either receive a deduction or a tax credit for such foreign tax paid or withheld. Generally, it will be more advantageous to claim a credit because a credit reduces United States federal income taxes
on a dollar-for-dollar basis, while a deduction merely reduces the taxpayers income subject to tax. This election is made on a year-by-year basis and applies to all foreign taxes paid by (or withheld from) the US Holder during that year. There are significant and complex limitations which apply to the credit, among which is the
general limitation that the credit cannot exceed the proportionate share of the US Holders United States income tax liability that the US Holders foreign sources income bears to his or its worldwide taxable income. In the determination
of the application of this limitation, the various items of income and deduction must be classified into foreign and domestic sources. Complex rules govern this classification process. In addition, this limitation is calculated separately with
respect to specific classes of income such as passive income, high withholding tax interest, financial services income, shipping income, and certain other classifications of income. Dividends



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distributed by the Company will generally constitute passive income or, in the case of certain US Holders, financial services income for these purposes. The availability
of the foreign tax credit and the application of the limitations on the credit are fact specific, and US Holders of common shares of the Company should consult their own tax advisors regarding their individual circumstances.

Disposition of Common Shares of the Company

A US Holder will recognize gain or loss upon the sale of common shares of the Company equal to the difference, if any, between: (i) the
amount of cash plus the fair market value of any property received; and (ii) the shareholders tax basis in the common shares of the Company. Preferential tax rates apply to long-term capital gains of US Holders who are individuals,
estates or trusts. This gain or loss will be capital gain or loss if the common shares are a capital asset in the hands of the US Holder, which will be long-term capital gain or loss if the common shares of the Company are held for more than one
year. Section 1411 of the Internal Revenue Code imposes a 3.8% Medicare surtax on net investment income of certain individuals, estates and trusts. In general, capital gain or loss recognized upon the sale of common shares of the Company will
be considered investment income for purposes of the surtax.

Other Considerations

In the following circumstances, the above sections of this discussion may not describe the United States federal income tax consequences
resulting from the holding and disposition of common shares:

Passive Foreign Investment Company

Certain United States income tax legislation contains rules governing passive foreign investment companies (PFIC) which
can have significant tax effects on US Holders of foreign corporations. These rules do not apply to non-US Holders.

Section 1297 of the Code defines a PFIC as a corporation that is not formed in the United States and, for any taxable year, either (i)
75% or more of its gross income is passive income, which includes interest, dividends and certain rents and royalties or (ii) the average percentage, by fair market value (or, if the Company is a controlled foreign corporation or
makes an election, adjusted tax basis) of its assets that produce or are held for the production of passive income is 50% or more. The Company does not believe that it is a PFIC. Each US Holder of the Company is urged to consult a tax
advisor with respect to how the PFIC rules affect their tax situation and whether any related reporting is required.

A US Holder who
holds stock in a foreign corporation during any year in which such corporation qualifies as a PFIC is subject to United States federal income taxation under one of three alternative tax regimes. The following is a discussion of such three
alternative tax regimes applied to such US Holders of the Company. In addition, special rules apply if a foreign corporation qualifies as both a PFIC and a controlled foreign corporation (as defined below) and a US Holder owns, directly
or indirectly, ten percent (10%) or more of the total combined voting power of classes of shares of such foreign corporation (See more detailed discussion at Controlled Foreign Company below).

A US Holder who makes a valid election to treat the Company as a Qualified Electing Fund (QEF) will be subject, under
Section 1293 of the Code, to current federal income tax for any taxable year in which the Company qualifies as a PFIC on his pro rata share of the Companys (i) net capital gain (the excess of net long-term capital gain over
net short-term capital loss), which will be taxed as long-term capital gain to the US Holder and (ii) ordinary earnings (the excess of earnings and profits over net capital gain), which will be taxed as ordinary income to the US Holder,
in each case, for the shareholders taxable year in which (or with which) the Companys taxable year ends, regardless of whether such amounts are actually distributed.

The effective QEF election allows a US Holder to: (i) generally treat any gain realized on the disposition of their common shares of the
Company (or deemed to be realized on the pledge of their shares) as capital gain; (ii) treat his share of the Companys net capital gain, if any, as long-term capital gain instead of ordinary income; and (iii) either avoid interest
charges resulting from PFIC status altogether, or make an annual election, subject to certain limitations, to defer payment of current taxes on his share of the Companys annual realized net capital gain and ordinary earnings subject, however,
to an interest charge. If the US Holder is not a corporation, such an interest charge would be treated as personal interest that is not deductible. US Holders should be aware that there can be no assurance that the Company will satisfy
the recordkeeping requirements that apply to a QEF, or that the Company will supply US Holders with the information that such US Holders require to report under the QEF rules, in the event that the Company is a PFIC and a US Holder wishes to make a
QEF election.



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A US Holder who makes a valid
mark-to-market election is required to include, under Section 1296 of the Code, in ordinary income for any taxable year in which the Company qualifies as a PFIC, an
amount equal to the excess, if any, of the fair market value of the Companys stock held by the US Holder at year-end over the US Holders tax basis in such stock. Any amount by which the US
Holders stock basis exceeds the fair market value of stock held at year-end will be allowed as an ordinary loss deduction to the extent of the unreversed inclusions with respect to such stock. Gain on a
sale or other disposition of the stock will be subject to ordinary income tax rates, and a loss on a disposition is deductible as an ordinary loss to the extent it does not exceed the unreversed inclusions attributable to the stock. An effective mark-to-market election allows a US Holder to avoid interest charges resulting from PFIC status where a QEF election may not be available.

If a US Holder does not make a valid QEF election or a
mark-to-market election during a year in which it holds (or is deemed to have held) the shares in question and the Company is a PFIC (a
Non-electing US Holder), then special taxation rules under Section 1291 of the Code will apply to: (i) gains realized on the disposition (or deemed to be realized by reasons of a pledge)
of his common shares of the Company; and (ii) certain excess distributions, as specifically defined, by the Company.

A Non-electing US Holder generally would be required to pro rate all gains realized on the disposition of his common shares of the Company and all excess distribution of his common shares and all excess distributions
over the entire holding period for the Company.

All gains or excess distributions allocated to prior years of the US Holder (other than
years prior to the first taxable year of the Company during such US Holders holding period and beginning after January 1, 1987 for which it was a PFIC) would be taxed at the highest tax rate for each such prior year applicable to ordinary
income. The Non-electing US Holder also would be liable for interest on the foregoing tax liability for each such prior year calculated as if such liability had been due with respect to each such prior year. A
Non-electing US Holder that is not a corporation must treat this interest charge as personal interest which, as discussed above, is wholly non-deductible.
The balance of the gain of the excess distribution will be treated as ordinary income in the year of the disposition or distribution, and no interest charge will be incurred with respect to such balance.

If the Company is a PFIC for any taxable year during which a Non-electing US Holder holds common
shares of the Company, then the Company will continue to be treated as a PFIC with respect to such common shares, even if it is no longer definitionally a PFIC. A Non-electing US Holder may terminate this
deemed PFIC status by electing to recognize a gain (which will be taxed under the rules discussed above for Non-electing US Holders) as if such common shares had been sold on the last day of the last taxable
year for which it was a PFIC.

Under Section 1291(f) of the Code, the IRS has issued proposed regulations that, subject to certain
exceptions, would treat as taxable certain transfers of PFIC stock by Non-Electing US Holders that are generally not otherwise taxed, such as gifts, exchanges pursuant to corporate reorganizations, and
transfers at death. Generally, in such cases the basis of the Company common shares in the hands of the transferee and the basis of any property received in the exchange for those common shares would be increased by the amount of gain recognized. A
US Holder that makes a valid QEF or a mark-to-market election (an Electing US Holder) would not be taxed on certain transfers of PFIC stock, such as gifts,
exchanges pursuant to corporate reorganizations, and transfers at death. The transferees basis in this case will depend on the manner of the transfer. In a transfer at death, for example, the transferees basis is equal to (i) the
fair market value of the Electing US Holders common shares, less (ii) the excess of the fair market value of the Electing US Holders common shares reduced by the US Holders adjusted basis in these common shares at death. The
specific tax effect to the US Holder and the transferee may vary based on the manner in which the common shares are transferred. Each US Holder of the Company is urged to consult a tax advisor with respect to how the PFIC rules affect their tax
situation and what elections may or may not be available.

Certain special, generally adverse, rules will apply with respect to common
shares of the Company while the Company is a PFIC whether or not it is treated as a QEF or a mark-to-market election is made. For example under Section 1297(b)(6) of the
Code, a US Holder who uses PFIC stock as security for a loan (including a margin loan) will, except as may be provided in regulations, be treated as having made a taxable disposition of such shares.

Controlled Foreign Company

If more than
50% of the voting power of all classes of shares or the total value of the shares of the Company is owned, directly or indirectly, by citizens or residents of the United States, United States domestic partnerships and corporations or estates or
trusts other than foreign estates or trusts, each of whom own 10% or more of the total combined voting power of all classes of shares of the Company (United States shareholder), the Company could be treated as a controlled foreign



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corporation under Subpart F of the Code. This classification would affect many complex results one of which is the inclusion of certain income of a CFC which is subject to current US tax.
The United States generally taxes a United States shareholder of a CFC currently on their pro rata shares of the Subpart F income of the CFC. Such US shareholders are generally treated as having received a current distribution out of the CFCs
Subpart F income and are also subject to current US tax on their pro rata shares of the CFCs earnings invested in US property. The foreign tax credit described above may reduce the US tax on these amounts. In addition, under Section 1248
of the Code, gain from the sale or exchange of shares by a US Holder of common shares of the Company who is or was a United States shareholder at any time during the five-year period ending with the sale or exchange is treated as ordinary income to
the extent of earnings and profits of the Company attributable to the shares sold or exchanged. If a foreign corporation is both a PFIC and a CFC, the foreign corporation generally will not be treated as a PFIC with respect to United States
shareholders of the CFC. This rule generally will be effective for taxable years of United States shareholders beginning after 1997 and for taxable years of foreign corporations ending with or within such taxable years of United States shareholders.
Special rules apply to United States shareholders who are subject to the special taxation rules under Section 1291 discussed above with respect to a PFIC. Because of the complexity of Subpart F, and because it is not clear that Subpart F would
apply to US Holders of common shares of the Company, a more detailed review of these rules is outside of the scope of this discussion.



| | F. | DIVIDENDS AND PAYING AGENTS
| | -- | ---------------------------

Not Applicable.



| | G. | STATEMENT BY EXPERTS
| | -- | --------------------

Not Applicable.



| | H. | DOCUMENTS ON DISPLAY
| | -- | --------------------

The documents referred to in this Form 20-F may be viewed at the Companys office located at 100 Paramount Drive, Suite 300, Sarasota, Florida 34232.



| | I. | SUBSIDIARY INFORMATION
| | -- | ----------------------

Not Applicable.



|Item 11: | Quantitative and Qualitative Disclosures About Market Risk
|-------- | ----------------------------------------------------------

Information for this Item is
set forth in Note 22 to the 2016 audited Consolidated Financial Statements under Item 18.



|Item 12: | Description of Securities Other than Equity Securities
|-------- | ------------------------------------------------------



| | A. | Debt Securities
| | -- | ---------------

Not Applicable.



| | B. | Warrants and Rights
| | -- | -------------------

Not Applicable.



| | C. | Other Securities
| | -- | ----------------

Not Applicable.



| | D. | American Depositary Shares
| | -- | --------------------------

None.



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PART II



|Item 13: | Defaults, Dividend Arrearages and Delinquencies
|-------- | -----------------------------------------------

None.



|Item 14: | Material Modifications to the Rights of Security Holders and Use of Proceeds
|-------- | ----------------------------------------------------------------------------

None.



|Item 15: | Controls and Procedures
|-------- | -----------------------

(a)    Disclosure Controls and
Procedures. IPG maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) designed to ensure not only that information required to
be disclosed in its reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms, but also that information required to be disclosed by the Company is
accumulated and communicated to management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. The Chief Executive Officer and Chief Financial Officer of the Company
conducted an evaluation of the effectiveness of the Companys disclosure controls and procedures and internal control over financial reporting as of December 31, 2016. They concluded based on such evaluation that the Companys
disclosure controls and procedures were effective.

(b)    Managements Annual Report on Internal Control Over
Financial Reporting. Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of the Companys financial reporting as well as the preparation of financial statements for external reporting purposes in accordance with International Financial Reporting Standards.

Internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with International Financial Reporting Standards, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Companys assets that could have a material effect on the Companys consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements, and even when
determined to be effective, can only provide reasonable assurance with respect to financial statements preparation and presentation. Also projections of any evaluation of effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.

Management conducted an assessment of the effectiveness of the Companys internal control over financial reporting as of
December 31, 2016 based on the criteria established in 2013 Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Management has concluded that the Companys internal
control over financial reporting was effective as of December 31, 2016 based on those criteria.

(c)    Attestation Report of Raymond Chabot Grant Thornton LLP. The Companys independent auditors, Raymond
Chabot Grant Thornton LLP, audited the annual consolidated financial statements included in this annual report and audited the Companys internal control over financial reporting as of December 31, 2016 and included in the Consolidated
Financial Statements referenced in Item 18 of this Form 20-F its report on the Companys internal control over financial reporting.

(d)    Changes in Internal Control Over Financial Reporting. There have been no changes in the Companys
internal control over financial reporting that occurred during 2016 that has materially affected, or is reasonably likely to materially affect, the Companys internal control over financial reporting.



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|Item 16: | [RESERVED]
|-------- | ----------



| | Item 16A: | Audit Committee Financial Expert
| | --------- | --------------------------------

The Board of Directors of IPG has determined that it
has at least one audit committee financial expert serving on its audit committee. Mr. Frank Di Tomaso, having over 45 years of experience in accounting and auditing, and having the attributes set forth in Paragraph 16A(b) of the General
Instructions to Form 20-F, has been determined to be an audit committee financial expert. Further, Mr. Di Tomaso is independent as that term is defined by the TSX and Sarbanes-Oxley Act.



| | Item 16B: | Code of Ethics
| | --------- | --------------

IPG has adopted a code of ethics entitled Intertape Polymer Group
Inc. Code of Business Conduct and Ethics, which is applicable to all of its employees, including its principal executive officer, principal financial officer, principal accounting officer or controller, and all persons performing similar
functions. A copy of the Companys Code of Business Conduct and Ethics has been posted on the Companys website at http://www.itape.com under Investor Relations, Corporate Governance, Governance
Documents. Any amendments to, or waiver from, any provision of the Code of Business Conduct and Ethics will be posted on the Companys website at the above address within 5 business days following the date of such amendment or waiver and
such information will remain available on the Companys website for at least a 12-month period.



| | Item 16C: | Principal Accountant Fees and Services
| | --------- | --------------------------------------

The following table sets forth the fees billed
(in Canadian dollars) for professional services rendered by Raymond Chabot Grant Thornton LLP, Chartered Accountants, the Companys independent auditors, for the fiscal years ended December 31, 2016, and December 31, 2015:



|                   |  |       |         |  |       |  |           | 
|------------------ |  | ----- | ------- |  | ----- |  | --------- | 
|                   |  | 2016$ |         |  | 2015$ | 
|Audit Fees         |  |       | 687,000 |  |       |  | 790,500   | 
|Audit-Related Fees |  |       | 113,000 |  |       |  | 59,000    | 
|Tax Fees           |  |       | 61,409  |  |       |  | 257,620   | 
|All Other Fees     |  |       |        |  |       |  |          | 
|                   |  |       |         |  |       |  |           | 
|Total Fees         |  |       | 861,409 |  |       |  | 1,107,120 | 
|                   |  |       |         |  |       |  |           | 

(a) Audit Fees. Audit fees were for professional services rendered for the integrated audit of
IPGs consolidated financial statements and internal control over financial reporting, assisting its Audit Committee in discharging its responsibilities for the review of the Companys interim unaudited consolidated financial statements
and services that generally only the independent auditor can reasonably provide, such as consent letters and assistance and review of documents filed with the SEC and Canadian securities regulatory authorities.

(b) Audit-Related Fees. Audit-related fees were for assurance and related services that are reasonably related to the performance of
the audit or review of IPGs consolidated interim unaudited financial statements and are not reported under the caption Audit Fees above. These services included consultations concerning financial accounting and reporting standards.

(c) Tax Fees. Tax fees were for tax compliance, tax advice and tax planning. These services included the preparation of the
Canadian subsidiaries income tax returns, assistance with questions regarding tax audits from the various taxation authorities in Canada and tax planning relating to common forms of domestic and international taxation.

(d) All Other Fees. All other fees are defined as services provided other than the audit fees, audit-related fees and tax fees
described above. No such fees have been billed in the last two years.

(e) IPGs Audit Committee charter provides for the
required pre-approvals of services to be rendered by the external auditors. The pre-approval process takes place annually and is presented by the Companys internal
accountants and the external auditors for planned activity including audit, tax and non-audit services and includes reasonable detail with respect to the services covered. The
pre-approval of all non-audit services allows the Committee to consider the effect of such services on



103



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the independence of the external auditor. Any such services that may arise in addition to the pre-approved plan must be presented separately to the
Committee for pre-approval. The charter states that this responsibility cannot be delegated to management of the Corporation in any way whatsoever.



| | Item 16D: | Exemptions from the Listing Standards for Audit Committee
| | --------- | ---------------------------------------------------------

Not Applicable.



| | Item 16E: | Purchase of Equity Securities by the Issuer and Affiliated Purchasers
| | --------- | ---------------------------------------------------------------------



|                                       |  |                                                           |         |  |                                                   |  |       |                                                                                                    |  |  |                                                                                                                               |  |  |  |           | 
|-------------------------------------- |  | --------------------------------------------------------- | ------- |  | ------------------------------------------------- |  | ----- | -------------------------------------------------------------------------------------------------- |  |  | ----------------------------------------------------------------------------------------------------------------------------- |  |  |  | --------- | 
|Period (1)                             |  | (a) Total number ofsubordinate votingshares purchased (*) |         |  | (b) Average price paidper subordinate votingshare |  |       | (c) Total number ofsubordinate votingshares purchased aspart of
publiclyannounced plans orprograms |  |  | (d) Maximum
number(or approximate dollarvalue) of subordinatevoting shares that mayyet be purchasedunder the plans orprograms | 
|January 1, 2016  January 31, 2016     |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 2,479,900 | 
|February 1, 2016  February 28, 2016   |  |                                                           | 147,200 |  |                                                   |  | 15.77 |                                                                                                    |  |  | 147,200                                                                                                                       |  |  |  | 2,332,700 | 
|March 1, 2016  March 31, 2016         |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 2,332,700 | 
|April 1, 2016 April 30, 2016          |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 2,332,700 | 
|May 1, 2016  May 31, 2016             |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 2,332,700 | 
|June 1, 2016  June 30, 2016           |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 2,332,000 | 
|July 1, 2016  July 31, 2016           |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 4,000,000 | 
|August 1, 2016  August 31, 2016       |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 4,000,000 | 
|September 1, 2016  September 30, 2016 |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 4,000,000 | 
|October 1, 2016  October 31, 2016     |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 4,000,000 | 
|November 1, 2016  November 30, 2016   |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 4,000,000 | 
|December 1, 2016  December 31, 2016   |  |                                                           |        |  |                                                   |  |      |                                                                                                    |  |  |                                                                                                                              |  |  |  | 4,000,000 | 
|                                       |  |                                                           | 147,200 |  |                                                   |  | 15.77 |                                                                                                    |  |  | 147,200                                                                                                                       |  |  |  | 4,000,000 | 



|1) | On July 10, 2015, the Company entered into an NCIB which entitled the Company to repurchase for cancellation up to 2,000,000 of the Companys common shares issued and outstanding. On November 11, 2015,
this NCIB was amended to increase the total shares available for repurchase to 4,000,000 common shares. This NCIB, which was scheduled to expire on July 9, 2016, was renewed for a twelve-month period starting July 14, 2016. This renewed
NCIB expires on July 13, 2017. As of December 31, 2016, the Company has repurchased 147,200common shares at an average price of CDN$15.77per share, including commissions, for a total purchase price of
$1.7 million.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | Item 16F: | Change in Registrants Certifying Accountant
| | --------- | --------------------------------------------

None.



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| | Item 16G: | Corporate Governance
| | --------- | --------------------

Not Applicable.



| | Item 16H: | Mine Safety Disclosure
| | --------- | ----------------------

Not Applicable.

PART III



|Item 17: | Financial Statements
|-------- | --------------------

Not Applicable.



|Item 18: | Financial Statements
|-------- | --------------------

The Consolidated Financial Statements required under Item 18 of
this Form 20-F are attached hereto as Exhibit A.



|Item 19: | Exhibits
|-------- | --------

The Consolidated Financial Statements and the following exhibits are filed as
part of this Annual Report on Form 20-F and are incorporated herein by reference.



| | A. | Consolidated Financial Statements
| | -- | ---------------------------------



| |  |  | Managements Responsibility for Financial Statements
| | - |  | ----------------------------------------------------



| |  |  | Managements Report on Internal Control over Financial Reporting
| | - |  | ----------------------------------------------------------------



| |  |  | Independent Auditors Report of Registered Public Accounting Firm
| | - |  | -----------------------------------------------------------------



| |  |  | Independent Auditors Report of Registered Public Accounting Firm on Internal Control over Financial Reporting
| | - |  | --------------------------------------------------------------------------------------------------------------



| |  |  | Consolidated Financial Statements as at December 31, 2014, 2015 and 2016
| | - |  | ------------------------------------------------------------------------



| |  |  | Consolidated Earnings
| | - |  | ---------------------



| |  |  | Consolidated Comprehensive Income
| | - |  | ---------------------------------



| |  |  | Consolidated Changes in Equity
| | - |  | ------------------------------



| |  |  | Consolidated Cash Flows
| | - |  | -----------------------



| |  |  | Consolidated Balance Sheets
| | - |  | ---------------------------



| |  |  | Notes to Consolidated Financial Statements
| | - |  | ------------------------------------------



105



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|B. | Exhibits:
|-- | ---------



1.1

Articles of Amalgamation as amended incorporated herein by reference to Exhibit 3.3 to S-4 filed October 26, 2004, File
No. 333-119982-26.1.2

General By-law 2003-1 incorporated herein by reference to Exhibit 3.4 to S-4 filed October 26, 2004, File No. 333-119982-26.1.3

By-Law 2015-1, filed under 6-K on December 1, 2015, Film No. 151262916.2.1

Shareholder Rights Plan Agreement with CST Trust Company, dated December 14, 2015, and ratified and approved by Shareholders on June 9, 2016, filed under 6-K on December 14,
2015, Film No. 151286632.4.1

Amended Executive Stock Option Plan incorporated herein by reference to S-8 filed November 7, 2012, File No. 333-184797. Executive Stock
Option Plan (as amended and consolidated to June 11, 2014) filed under 6-K on June 18, 2014, Film No. 14928713.4.2

Stock Appreciation Rights Plan, as amended, filed under 20-F on March 31, 2016, Film No. 161541654.4.3

Deferred Share Unit Plan, as amended on February 17, 2017, filed under S-8 on June 9, 2016, Film No. 161705637.4.4

Amended Performance Share Unit Plan, as amended on February 17, 2017, filed under S-8 on June 6, 2016, Film No. 14928649. Performance Share Unit Plan filed under 6-K, on June 18, 2014, Film No. 14928673.4.5

Equipment Finance Agreement filed under 6-K on September 5, 2012, Film No. 121073380.4.6

Credit Facility Agreement filed under 6-K on November 18, 2014, Film No. 141232715. First Amendment filed under 6-K on August 2, 2016,
Film No. 161798989, Second Amendment to Credit Agreement filed under 6-K on September 7, 2016, Film No. 161872241, and Third Amendment to Credit Agreement filed under 6-K on February 3, 2017, Film No. 17571201.8.1

A list of all of IPGs significant subsidiaries is set forth in Item 4C of this Form 20-F.10.1

During 2016, IPG was not required to send its directors and executive officers notices pursuant to Rule 104 of Regulation BTR concerning any equity security subject to a blackout period under Rule 101 of Regulation BTR. IPGs
blackout periods are regularly scheduled and a description of such periods, including their frequency and duration and plan transactions to be suspended or affected are included in the documents under which IPGs plans operate and is disclosed
to employees before enrollment or within thirty (30) days thereafter.12.1

Certification of the Chief Executive Officer required by Rule 13a-14(a) (17 CFR 240.13a-14(a)) or Rule 15d-14(a)
(17 CFR 240.15d-14(a)).12.2

Certification of the Chief Financial Officer required by Rule 13a-14(a) (17 CFR 240.13a-14(a) or Rule 15d-14(a)
(17 CFR 240.15d-14(a)).13.1

Certification of the Chief Executive Officer required by Rule 13a-14(b) (17 CFR 240.13a-14(b)) or Rule 15d-14(b)
(17 CFR 240.15d-14(b)) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350).




106



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13.2

Certification of the Chief Financial Officer required by Rule 13a-14(b) (17 CFR 240.13a-14(b)) or Rule 15d-14(b)
(17 CFR 240.15d-14(b)) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350).15.1

Consent of Independent Registered Public Accounting Firm.15.2

Human Resources and Compensation Committee Charter, as amended.15.3

Audit Committee Charter, as amended.




107



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SIGNATURES

The Registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that
it has duly caused and authorized the undersigned to sign this Annual Report on its behalf.



Intertape Polymer Group Inc.By:

/s/ Gregory A.C. YullGregory A.C. Yull, Chief Executive Officer


Dated March 29, 2017



108



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##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Financial Statements

December 31, 2016, 2015 and 2014



|                                                                                                                |  |  |              | 
|--------------------------------------------------------------------------------------------------------------- |  |  | ------------ | 
|                                                                                                                | 
|Managements Responsibility for Consolidated Financial
Statements                                               |  |  | F-2          | 
|                                                                                                                | 
|Managements Report on Internal Control over Financial
Reporting                                                |  |  | F-3          | 
|                                                                                                                | 
|Independent Auditors Report of Registered Public Accounting
Firm                                               |  |  | F-4 to F-5   | 
|                                                                                                                | 
|Independent Auditors Report of Registered Public Accounting Firm on Internal
 Control over Financial Reporting |  |  | F-6 to F-7   | 
|                                                                                                                | 
|Consolidated Financial Statements                                                                               |  |  |              | 
|                                                                                                                | 
|Consolidated Earnings                                                                                           |  |  | F-8          | 
|                                                                                                                | 
|Consolidated Comprehensive Income                                                                               |  |  | F-9          | 
|                                                                                                                | 
|Consolidated Changes in Equity                                                                                  |  |  | F-10 to F-12 | 
|                                                                                                                | 
|Consolidated Cash Flows                                                                                         |  |  | F-13         | 
|                                                                                                                | 
|Consolidated Balance Sheets                                                                                     |  |  | F-14         | 
|                                                                                                                | 
|Notes to Consolidated Financial Statements                                                                      |  |  | F-15 to F-77 | 



---

##### Table of Contents

Managements Responsibility for Financial Statements

The consolidated financial statements of Intertape Polymer Group Inc. (the Company) and other financial information are the responsibility of the
Companys management and have been examined and approved by its Board of Directors. These consolidated financial statements have been prepared by management in accordance with International Financial Reporting Standards (IFRS) as
issued by the International Accounting Standards Board and include some amounts that are based on managements best estimates and judgments. The selection of accounting principles and methods is managements responsibility.

Management is responsible for the design, establishment and maintenance of appropriate internal control and procedures over financial reporting, to ensure
that financial statements for external purposes are fairly presented in conformity with IFRS. Pursuant to these internal control and procedures, processes have been designed to ensure that the Companys transactions are properly authorized, the
Companys assets are safeguarded against unauthorized or improper use, and the Companys transactions are properly recorded and reported to permit the preparation of the Companys consolidated financial statements in conformity with
IFRS.

Management recognizes its responsibility for conducting the Companys affairs in a manner to comply with the requirements of applicable laws
and for maintaining proper standards of conduct in its activities.

The Audit Committee, all of whose members are independent directors, is involved in
the review of the consolidated financial statements and other financial information.

The Audit Committees role is to examine the consolidated
financial statements and annual report and once approved, recommend that the Board of Directors approve them, examine internal control over financial reporting and information protection systems and all other matters relating to the Companys
accounting and finances. In order to do so, the Audit Committee meets periodically with the external auditor to review its audit plan and discuss the results of its examinations. The Audit Committee is also responsible for recommending the
nomination of the external auditor.

The Companys external independent registered public accounting firm, Raymond Chabot Grant Thornton LLP, was
appointed by the Shareholders at the Annual Meeting of Shareholders on June 9 2016, to conduct the integrated audit of the Companys consolidated financial statements, and the Companys internal control over financial reporting. Its
reports indicating the scope of its audits and its opinions on the consolidated financial statements and the Companys internal control over financial reporting follow.

/s/ Gregory A.C. Yull

Gregory A.C. Yull

President and Chief Executive Officer

/s/ Jeffrey Crystal

Jeffrey Crystal

Chief Financial Officer

Sarasota, Florida and Montreal, Quebec

March 8, 2017



F-2



---

##### Table of Contents

Managements Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Internal control over financial
reporting is a process designed to provide reasonable assurance regarding the reliability of the Companys financial reporting as well as the preparation of financial statements for external reporting purposes in accordance with International
Financial Reporting Standards (IFRS).

Internal control over financial reporting includes those policies and procedures that (1) pertain
to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit the
preparation of financial statements in accordance with IFRS, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Companys assets that could have a material effect on the Companys financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements and, even when determined to be
effective, can only provide reasonable assurance with respect to financial statements preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.

Management conducted an assessment of the
effectiveness of the Companys internal control over financial reporting as of December 31, 2016 based on the criteria established in 2013 Internal Control  Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission.

Management has concluded that the Companys internal control over financial reporting was
effective as of December 31, 2016 based on those criteria.

The Companys internal control over financial reporting as of December 31, 2016
has been audited by Raymond Chabot Grant Thornton LLP, the Companys external independent registered public accounting firm, as stated in its report which follows.

/s/ Gregory A.C. Yull

Gregory A.C. Yull

President and Chief Executive Officer

/s/ Jeffrey Crystal

Jeffrey Crystal

Chief Financial Officer

Sarasota, Florida and Montreal, Quebec

March 8, 2017



F-3



---

##### Table of Contents

LOGO

Independent Auditors Report of

Registered Public Accounting Firm

To the Shareholders of

Intertape Polymer Group Inc.

Report on the
Consolidated Financial Statements

We have audited the accompanying consolidated financial statements of Intertape Polymer Group Inc. which
comprise the consolidated balance sheets as at December 31, 2016 and 2015 and the consolidated statements of earnings, comprehensive income, changes in equity and cash flows for each of the years in the three-year period ended December 31,
2016, and a summary of significant accounting policies and other explanatory information.

Managements Responsibility for the Consolidated
Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance
with International Financial Reporting Standards as issued by the International Accounting Standards Board, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are
free from material misstatement, whether due to fraud or error.

Auditors Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with Canadian
generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance
about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entitys preparation and fair presentation of the consolidated financial statements in order to design audit procedures that
are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the
consolidated financial statements.



F-4



---

##### Table of Contents

We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a
basis for our audit opinion.

Opinion

In our
opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Intertape Polymer Group Inc. as at December 31, 2016 and 2015, and its financial performance and its cash flows for each of the
years in the three-year period ended December 31, 2016 in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Other Matters

We have also audited, in accordance
with the standards of the Public Company Accounting Oversight Board (United States), Intertape Polymer Group Inc.s internal control over financial reporting as at December 31, 2016, based on the criteria established in 2013
Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 8, 2017, expressed an unqualified opinion on Intertape Polymer Group Inc.s
internal control over financial reporting.



|                              
|------------------------------
|LOGO                          
|                              
|Montreal, Canada March 8, 2017



|1 | CPA auditor, CA, public accountancy permit No. A121855
|- | ------------------------------------------------------



F-5



---

##### Table of Contents

LOGO

Independent Auditors Report of

Registered Public Accounting Firm on

Internal Control
over Financial Reporting

To the Shareholders of

Intertape Polymer Group Inc.

We have audited Intertape Polymer
Group Inc.s internal control over financial reporting as at December 31, 2016, based on criteria established in 2013 Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO).

Managements Responsibility

The Companys management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of
internal control over financial reporting included in Managements Report on Internal Control over Financial Reporting.

Auditors
Responsibility

Our responsibility is to express an opinion on the Companys internal control over financial reporting based on our audit. We
conducted our audit of internal control over financial reporting in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit of internal control over
financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk, and performing such other procedures as we considered necessary in the circumstances.

We believe that the audit evidence we have obtained
in our audit is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal control over financial reporting.

Definition of Internal Control over Financial Reporting

A companys internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. A companys internal control over financial
reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in



F-6



---

##### Table of Contents

reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary
to permit preparation of consolidated financial statements in accordance with International Financial Reporting Standards as issued by International Accounting Standards Board, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could
have a material effect on the consolidated financial statements.

Inherent Limitations

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company maintained,
in all material respects, effective internal control over financial reporting as at December 31, 2016 based on criteria established in 2013 Internal Control  Integrated Frameworkissued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).

We have also audited, in accordance with Canadian generally accepted auditing standards and standards of
the Public Company Accounting Oversight Board (United States), the consolidated financial statements of Intertape Polymer Group Inc. as at December 31, 2016 and 2015 and for each of the years in the three-year period ended December 31,
2016 and our report dated March 8, 2017 expressed an unqualified opinion thereon.



|                               
|-------------------------------
|LOGO                           
|                               
|Montreal, Canada 
March 8, 2017



|1 | CPA auditor, CA, public accountancy permit No. A121855
|- | ------------------------------------------------------



F-7



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##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Earnings

Years ended December 31, 2016,
2015 and 2014

(In thousands of US dollars, except per share amounts)



|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|------------------------------------------------------------------------------------------------ |  | ------ | ------- |  | ------ |  | ------- | ------ |  |  | ------- | 
|                                                                                                 |  | 2016   |         |  | 2015   |  |         | 2014   | 
|                                                                                                 |  | $      |         |  | $      |  |         | $      | 
|Revenue                                                                                          |  |        | 808,801 |  |        |  | 781,907 |        |  |  | 812,732 | 
|Cost of sales                                                                                    |  |        | 617,314 |  |        |  | 613,895 |        |  |  | 649,099 | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|Gross profit                                                                                     |  |        | 191,487 |  |        |  | 168,012 |        |  |  | 163,633 | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|Selling, general and administrative expenses                                                     |  |        | 102,580 |  |        |  | 84,072  |        |  |  | 85,955  | 
|Research expenses                                                                                |  |        | 10,790  |  |        |  | 9,459   |        |  |  | 7,873   | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|                                                                                                 |  |        | 113,370 |  |        |  | 93,531  |        |  |  | 93,828  | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|Operating profit before manufacturing facility closures, restructuring and other related
charges |  |        | 78,117  |  |        |  | 74,481  |        |  |  | 69,805  | 
|Manufacturing facility closures, restructuring and other related charges (Note 4)                |  |        | 2,408   |  |        |  | 3,666   |        |  |  | 4,927   | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|Operating profit                                                                                 |  |        | 75,709  |  |        |  | 70,815  |        |  |  | 64,878  | 
|Finance costs (income) (Note 3)                                                                  |  |        |         |  |        |  |         |        |  |  |         | 
|Interest                                                                                         |  |        | 4,398   |  |        |  | 3,553   |        |  |  | 4,631   | 
|Other expense (income), net                                                                      |  |        | 605     |  |        |  | (393    | )      |  |  | 1,528   | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|                                                                                                 |  | 5,003  |         |  | 3,160  |  |         | 6,159  | 
|Earnings before income tax expense                                                               |  |        | 70,706  |  |        |  | 67,655  |        |  |  | 58,719  | 
|Income tax expense (Note 5)                                                                      |  |        |         |  |        |  |         |        |  |  |         | 
|Current                                                                                          |  |        | 8,757   |  |        |  | 8,185   |        |  |  | 3,665   | 
|Deferred                                                                                         |  |        | 10,812  |  |        |  | 2,798   |        |  |  | 19,238  | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|                                                                                                 |  | 19,569 |         |  | 10,983 |  |         | 22,903 | 
|Net earnings                                                                                     |  |        | 51,137  |  |        |  | 56,672  |        |  |  | 35,816  | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|Net earnings attributable to:                                                                    |  |        |         |  |        |  |         |        |  |  |         | 
|Company shareholders                                                                             |  |        | 51,120  |  |        |  | 56,672  |        |  |  | 35,816  | 
|Non-controlling interest                                                                         |  |        | 17      |  |        |  |        |        |  |  |        | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|                                                                                                 |  | 51,137 |         |  | 56,672 |  |         | 35,816 | 
|                                                                                                 |  |        |         |  |        |  |         |        |  |  |         | 
|Earnings per share attributable to Company shareholders (Note 6)                                 |  |        |         |  |        |  |         |        |  |  |         | 
|Basic                                                                                            |  |        | 0.87    |  |        |  | 0.95    |        |  |  | 0.59    | 
|Diluted                                                                                          |  |        | 0.85    |  |        |  | 0.93    |        |  |  | 0.58    | 

The accompanying notes are an integral part of the consolidated financial statements and Note 3 presents additional
information on consolidated earnings.



F-8



---

##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Comprehensive Income

Years ended
December 31, 2016, 2015 and 2014

(In thousands of US dollars)



|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------ | ------ | - | ------ |  | ------- | ------ |  |  | ------- | -
|                                                                                                                                                                                       |  | 2016   |        |   | 2015   |  |         | 2014   | 
|                                                                                                                                                                                       |  | $      |        |   | $      |  |         | $      | 
|Net earnings                                                                                                                                                                           |  |        | 51,137 |   |        |  | 56,672  |        |  |  | 35,816  |  
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|Other comprehensive income (loss)                                                                                                                                                      |  |        |        |   |        |  |         |        |  |  |         |  
|Change in fair value of interest rate swap agreements designated as cash flow hedges (net of the
deferred tax expense (benefit) of $83 in 2016, ($166) in 2015 and nil 2014) (Note 22) |  |        | 136    |   |        |  | (272    | )      |  |  |        |  
|Change in cumulative translation adjustments                                                                                                                                           |  |        | 789    |   |        |  | (12,294 | )      |  |  | (7,343  | )
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|Items that will be reclassified subsequently to net earnings                                                                                                                           |  |        | 925    |   |        |  | (12,566 | )      |  |  | (7,343  | )
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|Remeasurement of defined benefit liability (net of income tax (expense) benefit of $(66), ($964)
in 2015 and $3,183 in 2014) (Note 18)                                                 |  |        | 201    |   |        |  | 1,586   |        |  |  | (5,023  | )
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|Items that will not be reclassified subsequently to net earnings                                                                                                                       |  |        | 201    |   |        |  | 1,586   |        |  |  | (5,023  | )
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|Other comprehensive income (loss)                                                                                                                                                      |  |        | 1,126  |   |        |  | (10,980 | )      |  |  | (12,366 | )
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|Comprehensive income for the period                                                                                                                                                    |  |        | 52,263 |   |        |  | 45,692  |        |  |  | 23,450  |  
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|Comprehensive income (loss) for the period attributable to:                                                                                                                            |  |        |        |   |        |  |         |        |  |  |         |  
|Company shareholders                                                                                                                                                                   |  |        | 52,353 |   |        |  | 45,692  |        |  |  | 23,450  |  
|Non-controlling interest                                                                                                                                                               |  |        | (90    | ) |        |  |        |        |  |  |        |  
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  
|                                                                                                                                                                                       |  | 52,263 |        |   | 45,692 |  |         | 23,450 | 
|                                                                                                                                                                                       |  |        |        |   |        |  |         |        |  |  |         |  

The accompanying notes are an integral part of the consolidated financial statements.



F-9



---

##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Changes in Equity

Year ended
December 31, 2014

(In thousands of US dollars, except for number of common shares)



|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|------------------------------------------------------------------------------------------ |  | ------------- | ---------- | - | ------ |  | ------- | --------------------------------- |  |  | -------------------------------------- | - |  | ------- | ------ | - | --------------------------------------------------------- |  | -------- | - |  |  | ------- | -
|                                                                                           |  | Capital stock |            |   |        |  |         | Accumulatedothercomprehensiveloss |  |  |                                        |  
|                                                                                           |  | Number        |            |   | Amount |  |         | Contributedsurplus                |  |  | Cumulativetranslationadjustmentaccount |   |  | Deficit |        |   | Equity attributableto Companyshareholders andtotal equity | 
|                                                                                           |  |               |            |   | $      |  |         | $                                 |  |  | $                                      |   |  | $       |        |   | $                                                         | 
|Balance as of December 31, 2013                                                            |  |               | 60,776,649 |   |        |  | 359,201 |                                   |  |  | 20,497                                 |   |  |         | (770   | ) |                                                           |  | (148,500 | ) |  |  | 230,428 |  
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|Transactions with owners                                                                   |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|Exercise of stock options (Note 16)                                                        |  |               | 256,677    |   |        |  | 843     |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  | 843     |  
|Change in excess tax benefit on exercised stock awards (Note 5)                            |  |               |            |   |        |  | 732     |                                   |  |  | (732                                   | ) |  |         |        |   |                                                           |  |          |   |  |  |        |  
|Change in excess tax benefit on outstanding stock awards (Note 5)                          |  |               |            |   |        |  |         |                                   |  |  | 2,535                                  |   |  |         |        |   |                                                           |  |          |   |  |  | 2,535   |  
|Share-based compensation expense (Note 16)                                                 |  |               |            |   |        |  |         |                                   |  |  | 2,482                                  |   |  |         |        |   |                                                           |  |          |   |  |  | 2,482   |  
|Share-based compensation expense credited to capital on options exercised (Note 16)        |  |               |            |   |        |  | 289     |                                   |  |  | (289                                   | ) |  |         |        |   |                                                           |  |          |   |  |  |        |  
|Repurchases of common stock (Note 16)                                                      |  |               | (597,500   | ) |        |  | (3,225  | )                                 |  |  |                                        |   |  |         |        |   |                                                           |  | (4,597   | ) |  |  | (7,822  | )
|Dividends on common shares (Note 16)                                                       |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  | (24,416  | ) |  |  | (24,416 | )
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|                                                                                           |  |               | (340,823   | ) |        |  | (1,361  | )                                 |  |  | 3,996                                  |   |  |         |        |   |                                                           |  | (29,013  | ) |  |  | (26,378 | )
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|Net earnings                                                                               |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  | 35,816   |   |  |  | 35,816  |  
|                                                                                           |  |               |            |   |        | 
|Other comprehensive loss                                                                   |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|Remeasurement of defined benefit liability (net of income tax benefit of $3,183) (Note
18) |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  | (5,023   | ) |  |  | (5,023  | )
|Changes to cumulative translation adjustments                                              |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         | (7,343 | ) |                                                           |  |          |   |  |  | (7,343  | )
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         | (7,343 | ) |                                                           |  | (5,023   | ) |  |  | (12,366 | )
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|Comprehensive income for the period                                                        |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         | (7,343 | ) |                                                           |  | 30,793   |   |  |  | 23,450  |  
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  
|Balance as of December 31, 2014                                                            |  |               | 60,435,826 |   |        |  | 357,840 |                                   |  |  | 24,493                                 |   |  |         | (8,113 | ) |                                                           |  | (146,720 | ) |  |  | 227,500 |  
|                                                                                           |  |               |            |   |        |  |         |                                   |  |  |                                        |   |  |         |        |   |                                                           |  |          |   |  |  |         |  

The accompanying notes are an integral part of the consolidated financial statements.



F-10



---

##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Changes in Equity

Year ended
December 31, 2015

(In thousands of US dollars, except for number of common shares)



|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|--------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ---------- | - | ------ |  | ------- | ------------------------------------ |  |  | -------------------------------------- | - |  | ------------------------- | ------- | - | ----- |  | ---- | ------- |  |  | --------------------------------------------------------- | - |  |  | -------- | - |  |  | ------- | -
|                                                                                                                                              |  | Capital stock |            |   |        |  |         | Accumulated other comprehensive loss |  |  |                                        |   |  |                           |        
|                                                                                                                                              |  | Number        |            |   | Amount |  |         | Contributedsurplus                   |  |  | Cumulativetranslationadjustmentaccount |   |  | Reserve forcash flowhedge |         |   | Total |  |      | Deficit |  |  | Equity attributableto Companyshareholders andtotal equity |  
|                                                                                                                                              |  |               |            |   | $      |  |         | $                                    |  |  | $                                      |   |  | $                         |         |   | $     |  |      | $       |  |  | $                                                         |  
|Balance as of December 31, 2014                                                                                                               |  |               | 60,435,826 |   |        |  | 357,840 |                                      |  |  | 24,493                                 |   |  |                           | (8,113  | ) |       |  |     |         |  |  | (8,113                                                    | ) |  |  | (146,720 | ) |  |  | 227,500 |  
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|Transactions with owners                                                                                                                      |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|Exercise of stock options (Note 16)                                                                                                           |  |               | 712,500    |   |        |  | 1,559   |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  | 1,559   |  
|Change in excess tax benefit on exercised stock awards (Note 5)                                                                               |  |               |            |   |        |  | 2,088   |                                      |  |  | (2,088                                 | ) |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |        |  
|Change in excess tax benefit on outstanding stock awards (Note 5)                                                                             |  |               |            |   |        |  |         |                                      |  |  | (1,502                                 | ) |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  | (1,502  | )
|Share-based compensation expense (Note 16)                                                                                                    |  |               |            |   |        |  |         |                                      |  |  | 3,359                                  |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  | 3,359   |  
|Share-based compensation expense credited to capital on options exercised (Note 16)                                                           |  |               |            |   |        |  | 746     |                                      |  |  | (746                                   | ) |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |        |  
|Deferred Share Units settlement, net of required minimum tax withholding (Note 16)                                                            |  |               | 6,397      |   |        |  | 65      |                                      |  |  | (218                                   | ) |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  | (153    | )
|Repurchases of common shares (Note 16)                                                                                                        |  |               | (2,487,188 | ) |        |  | (14,973 | )                                    |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  | (15,011  | ) |  |  | (29,984 | )
|Dividends on common shares (Note 16)                                                                                                          |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  | (29,743  | ) |  |  | (29,743 | )
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|                                                                                                                                              |  |               | (1,768,291 | ) |        |  | (10,515 | )                                    |  |  | (1,195                                 | ) |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  | (44,754  | ) |  |  | (56,464 | )
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|Net earnings                                                                                                                                  |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  | 56,672   |   |  |  | 56,672  |  
|Other comprehensive loss                                                                                                                      |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|Change in fair value of interest rate swap agreements designated as a cash flow hedges (net of
deferred income tax benefit of $166) (Note 22) |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  | (272 | )       |  |  | (272                                                      | ) |  |  |          |   |  |  | (272    | )
|Remeasurement of defined benefit liability (net of income tax expense of $964) (Note 18)                                                      |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  | 1,586    |   |  |  | 1,586   |  
|Change in cumulative translation adjustments                                                                                                  |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           | (12,294 | ) |       |  |      |         |  |  | (12,294                                                   | ) |  |  |          |   |  |  | (12,294 | )
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           | (12,294 | ) |       |  | (272 | )       |  |  | (12,566                                                   | ) |  |  | 1,586    |   |  |  | (10,980 | )
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|Comprehensive income for the period                                                                                                           |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           | (12,294 | ) |       |  | (272 | )       |  |  | (12,566                                                   | ) |  |  | 58,258   |   |  |  | 45,692  |  
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  
|Balance as of December 31, 2015                                                                                                               |  |               | 58,667,535 |   |        |  | 347,325 |                                      |  |  | 23,298                                 |   |  |                           | (20,407 | ) |       |  | (272 | )       |  |  | (20,679                                                   | ) |  |  | (133,216 | ) |  |  | 216,728 |  
|                                                                                                                                              |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                           |   |  |  |          |   |  |  |         |  

The accompanying notes are an integral part of the consolidated financial statements.



F-11



---

##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Changes in Equity

Year ended
December 31, 2016

(In thousands of US dollars, except for number of common shares)



|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|---------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ---------- | - | ------ |  | ------- | ------------------------------------ |  |  | -------------------------------------- | - |  | ------------------------- | ------- | - | ----- |  | ---- | ------- |  |  | ---------------------------------------------- | - |  | ----------------------- | -------- | - | ----------- |  | ------- | - |  |  | ----- | - |  |  | ------- | -
|                                                                                                                                               |  | Capital stock |            |   |        |  |         | Accumulated other comprehensive loss |  |  |                                        |   |  |                           |         |   |       |  |      |         | 
|                                                                                                                                               |  | Number        |            |   | Amount |  |         | Contributedsurplus                   |  |  | Cumulativetranslationadjustmentaccount |   |  | Reserve forcash flowhedge |         |   | Total |  |      | Deficit |  |  | Total equityattributableto Companyshareholders |   |  | Non-controllinginterest |          |   | Totalequity | 
|                                                                                                                                               |  |               |            |   | $      |  |         | $                                    |  |  | $                                      |   |  | $                         |         |   | $     |  |      | $       |  |  | $                                              |   |  | $                       |          |   | $           | 
|Balance as of December 31, 2015                                                                                                                |  |               | 58,667,535 |   |        |  | 347,325 |                                      |  |  | 23,298                                 |   |  |                           | (20,407 | ) |       |  | (272 | )       |  |  | (20,679                                        | ) |  |                         | (133,216 | ) |             |  | 216,728 |   |  |  |      |   |  |  | 216,728 |  
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|Transactions with owners                                                                                                                       |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|Exercise of stock options (Note 16)                                                                                                            |  |               | 540,000    |   |        |  | 1,452   |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  | 1,452   |   |  |  |       |   |  |  | 1,452   |  
|Change in excess tax benefit on exercised stock awards (Note 5)                                                                                |  |               |            |   |        |  | 2,693   |                                      |  |  | (2,693                                 | ) |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |        |   |  |  |       |   |  |  |        |  
|Change in excess tax benefit on outstanding stock awards (Note 5)                                                                              |  |               |            |   |        |  |         |                                      |  |  | 4,302                                  |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  | 4,302   |   |  |  |       |   |  |  | 4,302   |  
|Share-based compensation expense (Note 16)                                                                                                     |  |               |            |   |        |  |         |                                      |  |  | 5,273                                  |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  | 5,273   |   |  |  |       |   |  |  | 5,273   |  
|Share-based compensation expense credited to capital on options exercised (Note 16)                                                            |  |               |            |   |        |  | 595     |                                      |  |  | (595                                   | ) |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |        |   |  |  |       |   |  |  |        |  
|Repurchases of common shares (Note 16)                                                                                                         |  |               | (147,200   | ) |        |  | (862    | )                                    |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         | (835     | ) |             |  | (1,697  | ) |  |  |       |   |  |  | (1,697  | )
|Dividends on common shares (Note 16)                                                                                                           |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         | (31,694  | ) |             |  | (31,694 | ) |  |  |       |   |  |  | (31,694 | )
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|                                                                                                                                               |  |               | 392,800    |   |        |  | 3,878   |                                      |  |  | 6,287                                  |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         | (32,529  | ) |             |  | (22,364 | ) |  |  |       |   |  |  | (22,364 | )
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|Net earnings                                                                                                                                   |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         | 51,120   |   |             |  | 51,120  |   |  |  | 17    |   |  |  | 51,137  |  
|Other comprehensive income                                                                                                                     |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|Change in fair value of interest rate swap agreements designated as cash flow hedges (net of the
deferred income tax expense of $83) (Note 22) |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  | 136  |         |  |  | 136                                            |   |  |                         |          |   |             |  | 136     |   |  |  |       |   |  |  | 136     |  
|Remeasurement of defined benefit liability (net of income tax expense of $66) (Note 18)                                                        |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         | 201      |   |             |  | 201     |   |  |  |       |   |  |  | 201     |  
|Change in cumulative translation adjustments                                                                                                   |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           | 896     |   |       |  |      |         |  |  | 896                                            |   |  |                         |          |   |             |  | 896     |   |  |  | (107  | ) |  |  | 789     |  
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           | 896     |   |       |  | 136  |         |  |  | 1,032                                          |   |  |                         | 201      |   |             |  | 1,233   |   |  |  | (107  | ) |  |  | 1,126   |  
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|Comprehensive income for the period                                                                                                            |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           | 896     |   |       |  | 136  |         |  |  | 1,032                                          |   |  |                         | 51,321   |   |             |  | 52,353  |   |  |  | (90   | ) |  |  | 52,263  |  
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|Recognition of non-controlling interest put option
liability (Note 15)                                                                         |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         | (10,181  | ) |             |  | (10,181 | ) |  |  |       |   |  |  | (10,181 | )
|Non-controlling interest arising from the Powerband
Acquisition (Note 17)                                                                      |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  | 6,497 |   |  |  | 6,497   |  
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  
|Balance as of December 31, 2016                                                                                                                |  |               | 59,060,335 |   |        |  | 351,203 |                                      |  |  | 29,585                                 |   |  |                           | (19,511 | ) |       |  | (136 | )       |  |  | (19,647                                        | ) |  |                         | (124,605 | ) |             |  | 236,536 |   |  |  | 6,407 |   |  |  | 242,943 |  
|                                                                                                                                               |  |               |            |   |        |  |         |                                      |  |  |                                        |   |  |                           |         |   |       |  |      |         |  |  |                                                |   |  |                         |          |   |             |  |         |   |  |  |       |   |  |  |         |  

The accompanying notes are an integral part of the consolidated financial statements.



F-12



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##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Cash Flows

Years ended December 31,
2016, 2015 and 2014

(In thousands of US dollars)



|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|------------------------------------------------------------------------------------------------------------ |  | ---- | -------- | - | ---- |  | -------- | ---- |  |  | -------- | -
|                                                                                                             |  | 2016 |          |   | 2015 |  |          | 2014 | 
|                                                                                                             |  | $    |          |   | $    |  |          | $    | 
|OPERATING ACTIVITIES                                                                                         |  |      |          |   |      |  |          |      |  |  |          |  
|Net earnings                                                                                                 |  |      | 51,137   |   |      |  | 56,672   |      |  |  | 35,816   |  
|Adjustments to net earnings                                                                                  |  |      |          |   |      |  |          |      |  |  |          |  
|Depreciation and amortization                                                                                |  |      | 30,978   |   |      |  | 30,880   |      |  |  | 26,169   |  
|Income tax expense                                                                                           |  |      | 19,569   |   |      |  | 10,983   |      |  |  | 22,903   |  
|Interest expense                                                                                             |  |      | 4,398    |   |      |  | 3,553    |      |  |  | 4,631    |  
|Non-cash charges in connection with manufacturing facility
closures, restructuring and other related charges |  |      | 5,204    |   |      |  | 4,620    |      |  |  | 284      |  
|Impairment of inventories                                                                                    |  |      | 1,997    |   |      |  | 760      |      |  |  | 465      |  
|Share-based compensation expense                                                                             |  |      | 8,201    |   |      |  | 3,249    |      |  |  | 6,185    |  
|Pension, post-retirement and other long-term employee benefits                                               |  |      | 2,913    |   |      |  | 2,654    |      |  |  | 4,495    |  
|(Gain) loss on foreign exchange                                                                              |  |      | (510     | ) |      |  | (1,308   | )    |  |  | 548      |  
|Impairment (reversals of impairment) of assets                                                               |  |      | 226      |   |      |  | (5,796   | )    |  |  | 139      |  
|Other adjustments for non cash items                                                                         |  |      | 50       |   |      |  | (488     | )    |  |  | 85       |  
|Income taxes paid, net                                                                                       |  |      | (7,193   | ) |      |  | (5,209   | )    |  |  | (4,329   | )
|Contributions to defined benefit plans                                                                       |  |      | (1,268   | ) |      |  | (1,877   | )    |  |  | (2,196   | )
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Cash flows from operating activities before changes in working capital items                                 |  |      | 115,702  |   |      |  | 98,693   |      |  |  | 95,195   |  
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Changes in working capital items                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Trade receivables                                                                                            |  |      | (8,920   | ) |      |  | 4,605    |      |  |  | (4,258   | )
|Inventories                                                                                                  |  |      | (4,074   | ) |      |  | (6,105   | )    |  |  | (5,151   | )
|Parts and supplies                                                                                           |  |      | (1,053   | ) |      |  | (1,747   | )    |  |  | (490     | )
|Other current assets                                                                                         |  |      | 451      |   |      |  | 5,700    |      |  |  | (919     | )
|Accounts payable and accrued liabilities                                                                     |  |      | 5,304    |   |      |  | 3,090    |      |  |  | 1,746    |  
|Provisions                                                                                                   |  |      | 725      |   |      |  | (1,968   | )    |  |  | 787      |  
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|                                                                                                             |  |      | (7,567   | ) |      |  | 3,575    |      |  |  | (8,285   | )
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Cash flows from operating activities                                                                         |  |      | 108,135  |   |      |  | 102,268  |      |  |  | 86,910   |  
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|INVESTING ACTIVITIES                                                                                         |  |      |          |   |      |  |          |      |  |  |          |  
|Acquisition of subsidiaries, net of cash acquired                                                            |  |      | (41,855  | ) |      |  | (26,234  | )    |  |  |         |  
|Purchases of property, plant and equipment                                                                   |  |      | (49,972  | ) |      |  | (34,301  | )    |  |  | (40,616  | )
|Proceeds from disposals of property, plant and equipment                                                     |  |      | 70       |   |      |  | 1,355    |      |  |  | 4,178    |  
|Other investing activities                                                                                   |  |      | (92      | ) |      |  | (50      | )    |  |  | (376     | )
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Cash flows from investing activities                                                                         |  |      | (91,849  | ) |      |  | (59,230  | )    |  |  | (36,814  | )
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|FINANCING ACTIVITIES                                                                                         |  |      |          |   |      |  |          |      |  |  |          |  
|Proceeds from borrowings                                                                                     |  |      | 180,604  |   |      |  | 191,279  |      |  |  | 294,022  |  
|Repayment of borrowings                                                                                      |  |      | (155,630 | ) |      |  | (160,473 | )    |  |  | (300,643 | )
|Interest paid                                                                                                |  |      | (4,739   | ) |      |  | (3,740   | )    |  |  | (3,755   | )
|Proceeds from exercise of stock options                                                                      |  |      | 1,452    |   |      |  | 1,559    |      |  |  | 843      |  
|Repurchases of common shares                                                                                 |  |      | (1,697   | ) |      |  | (30,018  | )    |  |  | (7,826   | )
|Dividends paid                                                                                               |  |      | (31,365  | ) |      |  | (29,695  | )    |  |  | (24,249  | )
|Other financing activities                                                                                   |  |      | (160     | ) |      |  | (150     | )    |  |  | (2,113   | )
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Cash flows from financing activities                                                                         |  |      | (11,535  | ) |      |  | (31,238  | )    |  |  | (43,721  | )
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Net increase in cash                                                                                         |  |      | 4,751    |   |      |  | 11,800   |      |  |  | 6,375    |  
|Effect of foreign exchange differences on cash                                                               |  |      | (1,410   | ) |      |  | (2,527   | )    |  |  | (533     | )
|Cash, beginning of year                                                                                      |  |      | 17,615   |   |      |  | 8,342    |      |  |  | 2,500    |  
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  
|Cash, end of year                                                                                            |  |      | 20,956   |   |      |  | 17,615   |      |  |  | 8,342    |  
|                                                                                                             |  |      |          |   |      |  |          |      |  |  |          |  

The accompanying notes are an integral part of the consolidated financial statements.



F-13



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##### Table of Contents

Intertape Polymer Group Inc.

Consolidated Balance Sheets

As of

(In thousands of US dollars)



|                                                                         |  |                  |          |   |                  |  |          |  
|------------------------------------------------------------------------ |  | ---------------- | -------- | - | ---------------- |  | -------- | -
|                                                                         |  | December 31,2016 |          |   | December 31,2015 | 
|                                                                         |  | $                |          |   | $                | 
|ASSETS                                                                   |  |                  |          |   |                  |  |          |  
|                                                                         |  |                 
|Current assets                                                           |  |                  |          |   |                  |  |          |  
|Cash                                                                     |  |                  | 20,956   |   |                  |  | 17,615   |  
|Trade receivables                                                        |  |                  | 90,122   |   |                  |  | 78,517   |  
|Inventories (Note 7)                                                     |  |                  | 103,470  |   |                  |  | 100,551  |  
|Parts and supplies                                                       |  |                  | 16,368   |   |                  |  | 15,265   |  
|Other current assets (Note 8)                                            |  |                  | 11,321   |   |                  |  | 8,699    |  
|                                                                         |  |                  |          |   |                  |  |          |  
|                                                                         |  |                  | 242,237  |   |                  |  | 220,647  |  
|Property, plant and equipment (Note 9)                                   |  |                  | 233,478  |   |                  |  | 198,085  |  
|Goodwill (Note 17)                                                       |  |                  | 30,841   |   |                  |  | 7,476    |  
|Intangible assets (Note 11)                                              |  |                  | 34,050   |   |                  |  | 12,568   |  
|Deferred tax assets (Note 5)                                             |  |                  | 36,611   |   |                  |  | 45,308   |  
|Other assets (Note 10)                                                   |  |                  | 3,380    |   |                  |  | 3,178    |  
|                                                                         |  |                  |          |   |                  |  |          |  
|Total assets                                                             |  |                  | 580,597  |   |                  |  | 487,262  |  
|                                                                         |  |                  |          |   |                  |  |          |  
|LIABILITIES                                                              |  |                  |          |   |                  |  |          |  
|                                                                         |  |                 
|Current liabilities                                                      |  |                  |          |   |                  |  |          |  
|Accounts payable and accrued liabilities                                 |  |                  | 100,216  |   |                  |  | 82,226   |  
|Provisions, current (Note 15)                                            |  |                  | 3,851    |   |                  |  | 2,209    |  
|Borrowings, current (Note 13)                                            |  |                  | 7,604    |   |                  |  | 5,702    |  
|                                                                         |  |                  |          |   |                  |  |          |  
|                                                                         |  |                  | 111,671  |   |                  |  | 90,137   |  
|Borrowings, non-current (Note 13)                                        |  |                  | 172,221  |   |                  |  | 147,134  |  
|Pension, post-retirement and other long-term employee benefits (Note 18) |  |                  | 30,832   |   |                  |  | 29,292   |  
|Deferred tax liabilities (Note 5)                                        |  |                  | 9,332    |   |                  |  |         |  
|Provisions, non-current (Note 14)                                        |  |                  | 2,040    |   |                  |  | 2,942    |  
|Other liabilities (Note 15)                                              |  |                  | 11,558   |   |                  |  | 1,029    |  
|                                                                         |  |                  |          |   |                  |  |          |  
|                                                                         |  |                  | 337,654  |   |                  |  | 270,534  |  
|                                                                         |  |                  |          |   |                  |  |          |  
|EQUITY                                                                   |  |                  |          |   |                  |  |          |  
|                                                                         |  |                 
|Capital stock (Note 16)                                                  |  |                  | 351,203  |   |                  |  | 347,325  |  
|Contributed surplus (Note 16)                                            |  |                  | 29,585   |   |                  |  | 23,298   |  
|Deficit                                                                  |  |                  | (124,605 | ) |                  |  | (133,216 | )
|Accumulated other comprehensive loss                                     |  |                  | (19,647  | ) |                  |  | (20,679  | )
|                                                                         |  |                  |          |   |                  |  |          |  
|Total equity attributable to Company shareholders                        |  |                  | 236,536  |   |                  |  | 216,728  |  
|Non-controlling interest (Note 17)                                       |  |                  | 6,407    |   |                  |  |         |  
|                                                                         |  |                  |          |   |                  |  |          |  
|Total equity                                                             |  |                  | 242,943  |   |                  |  | 216,728  |  
|                                                                         |  |                  |          |   |                  |  |          |  
|Total liabilities and equity                                             |  |                  | 580,597  |   |                  |  | 487,262  |  
|                                                                         |  |                  |          |   |                  |  |          |  

The accompanying notes are an integral part of the consolidated financial statements.



F-14



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##### Table of Contents

Intertape Polymer Group Inc.

Notes to Consolidated Financial Statements

December 31, 2016

(In US dollars, tabular amounts in
thousands, except shares, per share data and as otherwise noted)

1 -GENERAL BUSINESS DESCRIPTION

Intertape Polymer Group Inc. (the Parent Company), incorporated under the Canada Business Corporations Act, has its principal administrative
offices in Montreal, Québec, Canada and in Sarasota, Florida, U.S.A. The address of the Parent Companys registered office is 800 Place Victoria, Suite 3700, Montreal, Québec H4Z 1E9, c/o Fasken Martineau DuMoulin LLP. The Parent
Companys common shares are listed on the Toronto Stock Exchange (TSX) in Canada.

The Parent Company and its subsidiaries (together
referred to as the Company) develop, manufacture and sell a variety of paper and film based pressure sensitive and water activated tapes, polyethylene and specialized polyolefin films, woven coated fabrics and complementary packaging
systems for industrial and retail use.

Intertape Polymer Group Inc. is the Companys ultimate parent.

2 -ACCOUNTING POLICIES

Basis of
Presentation and Statement of Compliance

The consolidated financial statements present the Companys consolidated balance sheets as of
December 31, 2016 and 2015, as well as its consolidated earnings, consolidated comprehensive income, consolidated cash flows, and consolidated changes in equity for each of the years in the three-year period ended December 31, 2016. These
consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and are expressed in United States
(US) dollars.

The consolidated financial statements were authorized for issuance by the Companys Board of Directors on March 8,
2017.

Basis of Measurement

The consolidated
financial statements have been prepared on the historical cost basis, except for certain financial instruments that are measured at revalued amounts or fair values at the end of each reporting period and the Companys pension plans,
post-retirement plans and other long-term employee benefit plans, as explained in the accounting policies below.

Principles of Consolidation

The consolidated financial statements include the accounts of the Parent Company and all of its subsidiaries. The Parent Company controls a subsidiary if it is
exposed, or has rights, to variable return, from its involvement with the subsidiary and has the ability to affect those returns through its power over the subsidiary. With the exception of Powerband Industries Private Limited
(Powerband), at the reporting date, the subsidiaries are all, directly or indirectly, 100% owned by the Parent Company.

Powerband has a
fiscal year end of March 31 due to local legislation. However, for consolidation purposes, the financial information for Powerband is presented as of the same date as the Parent Company. All other subsidiaries have a reporting date identical to
that of the Parent Company. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Parent Company.



F-15



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##### Table of Contents

All intercompany balances and transactions have been eliminated on consolidation, including unrealized gains and
losses on transactions between the consolidated entities.

Details of the Parent Companys subsidiaries as of December 31, 2016 are as follows:



|                                                |  |                    |  |                                        |  |                                                      
|----------------------------------------------- |  | ------------------ |  | -------------------------------------- |  | -----------------------------------------------------
|Name of Subsidiary                              |  | Principal
Activity |  | Country of Incorporation
and Residence |  | Proportion of OwnershipInterest and Voting Power Held
|Intertape Polymer Corp.                         |  | Manufacturing      |  | United States                          |  | 100%                                                 
|IPG (US) Holdings Inc.                          |  | Holding            |  | United States                          |  | 100%                                                 
|IPG (US) Inc.                                   |  | Holding            |  | United States                          |  | 100%                                                 
|Intertape Polymer Inc.                          |  | Manufacturing      |  | Canada                                 |  | 100%                                                 
|FIBOPE Portuguesa-Filmes Biorientados, S.A.     |  | Manufacturing      |  | Portugal                               |  | 100%                                                 
|Intertape Polymer Europe GmbH                   |  | Distribution       |  | Germany                                |  | 100%                                                 
|IPG Luxembourg Finance S.à r.l                  |  | Financing          |  | Luxembourg                             |  | 100%                                                 
|Intertape Woven Products, S.A. de C.V.          |  | Non-operating      |  | Mexico                                 |  | 100%                                                 
|Intertape Woven Products Services, S.A. de C.V. |  | Non-operating      |  | Mexico                                 |  | 100%                                                 
|Spuntech Fabrics, Inc.                          |  | Holding            |  | Canada                                 |  | 100%                                                 
|Better Packages, Inc.                           |  | Manufacturing      |  | United States                          |  | 100%                                                 
|BP Acquisition Corporation                      |  | Holding            |  | United States                          |  | 100%                                                 
|RJM Manufacturing, LLC                          |  |                    |  |                                        |  | 100%                                                 
|(d/b/a TaraTape)                                |  | Manufacturing      |  | United States                          |  | 100%                                                 
|IPG Mauritius Ltd                               |  | Holding            |  | Mauritius                              |  | 100%                                                 
|IPG Mauritius II Ltd                            |  | Holding            |  | Mauritius                              |  | 100%                                                 
|IPG Mauritius Holding Company Ltd               |  | Holding            |  | Mauritius                              |  | 100%                                                 
|Powerband Industries Private Limited            |  | Manufacturing      |  | India                                  |  | 74%                                                  

Business Acquisitions

The Company applies the acquisition method of accounting for business acquisitions. The consideration transferred by the Company to obtain control of a
subsidiary is calculated as the sum of the acquisition-date fair values of assets transferred, liabilities incurred and the equity interests issued by the Company. Acquisition costs are expensed as incurred. Assets acquired and liabilities assumed
are generally measured at their acquisition-date fair values. Refer to Note 17 for more information regarding business acquisitions.

Foreign Currency
Translation

Functional and presentation currency

The consolidated financial statements are presented in US dollars, which is the Companys presentation currency. Items included in the financial
statements of each of the consolidated entities are measured using the currency of the primary economic environment in which each entity operates (the functional currency). The significant functional currencies of the different
consolidated entities include the US dollar, Canadian dollar, Indian rupee and Euro.



F-16



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##### Table of Contents

Transactions and balances

Transactions denominated in currencies other than the functional currency of a consolidated entity are translated into the functional currency of that entity
using the exchange rates prevailing at the date of each transaction.

Monetary assets and liabilities denominated in foreign currencies are translated
into the functional currencies using the current rate at each period-end. Foreign exchange gains or losses arising on the settlement of monetary items or on the translation of monetary items at rates different
from those at which they were translated on initial recognition during the period or in previous financial statements are recognized in earnings in finance costs in the period in which they arise, except when deferred in other comprehensive income
(loss) (OCI) as a qualifying cash flow hedge.

Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

Group companies

Assets and liabilities of entities with a functional currency other than the US dollar are translated to the presentation currency using the closing exchange
rate in effect at the balance sheet date, and revenues and expenses are translated at each month-ends average exchange rate. The resulting translation adjustments are charged or credited to OCI and
recognized in the cumulative translation adjustment account within accumulated other comprehensive income (loss) in equity.

When a foreign operation is
partially disposed of or sold, exchange differences that were recorded in equity are recognized in earnings as part of the gain or loss on sale.

Foreign
exchange gains or losses recognized in earnings are presented in cost of sales and finance costs.

Segment Reporting

The Company operates as a single segment.

Critical
Accounting Judgments, Estimates and Assumptions

The preparation of the consolidated financial statements in conformity with IFRS requires management
to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Significant changes in the underlying assumptions could result in significant
changes to these estimates. Consequently, management reviews these estimates on a regular basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Information about
these significant judgments, assumptions and estimates that have the most significant effect on the recognition and measurement of assets, liabilities, income and expenses are summarized below:

Significant Management Judgment

Deferred income taxes

Deferred tax assets are recognized for unused tax losses and tax credits to the extent that it is probable that future taxable income will be
available against which the losses can be utilized. These estimates are reviewed at every reporting date. Significant management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing
and the level of the reversal of existing timing differences, future taxable income and future tax planning strategies. Refer to Note 5 for more information regarding income taxes.



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Estimation Uncertainty

Impairments

At the end of each reporting period the
Company performs a test of impairment on assets subject to amortization if there are indicators of impairment. Goodwill allocated to cash generating units (CGU) and intangible assets with indefinite useful lives are tested annually. An
impairment loss is recognized when the carrying value of an asset or CGU exceeds its recoverable amount, which in turn is the higher of its fair value less costs to sell and its value in use. The value in use is based on discounted estimated future
cash flows. The cash flows are derived from the budget or forecasts for the estimated remaining useful lives of the CGUs and do not include restructuring activities that the Company is not yet committed to or significant future investments that will
enhance the performance of the asset or CGU being tested. The value in use will vary depending on the discount rate applied to the discounted cash flows, the estimated future cash inflows, and the growth rate used for extrapolation purposes.

Refer to Note 12 for more information regarding impairment testing.

Pension, post-retirement and other long-term employee benefits

The cost of defined benefit pension plans and other post-retirement benefit plans and the present value of the related obligations are determined using
actuarial valuations. The determination of benefits expense and related obligations requires assumptions such as the discount rate to measure obligations, expected mortality and the expected healthcare cost trend. Actual results will differ from
estimated results, which are based on assumptions. Refer to Note 18 for more information regarding the assumptions related to the pension, post-retirement and other long-term employee benefit plans.

Uncertain tax positions

The Company is subject to
taxation in numerous jurisdictions. There are many transactions and calculations during the course of business for which the ultimate tax determination is uncertain. The Company maintains provisions for uncertain tax positions that it believes
appropriately reflect its risk. These provisions are made using the best estimate of the amount expected to be paid based on a qualitative assessment of all relevant factors. The Company reviews the adequacy of these provisions at the end of the
reporting period. However, it is possible that at some future date, liabilities in excess of the Companys provisions could result from audits by, or litigation with, the relevant taxing authorities. Refer to Note 5 for more information
regarding income taxes.

Useful lives of depreciable assets

Management reviews the useful lives, depreciation methods and residual values of depreciable assets at each reporting date. As of the reporting date,
management assesses the useful lives which represent the expected utility of the assets to the Company. Actual results, however, may vary due to technical or commercial obsolescence, particularly with respect to information technology and
manufacturing equipment.

Net realizable value of inventories and parts and supplies

Inventories and parts and supplies are measured at the lower of cost or net realizable value. In estimating net realizable values of inventories and parts and
supplies, management takes into account the most reliable evidence available at the time the estimate is made.

Provisions for slow-moving and obsolete
inventories are made based on the age and estimated net realizable value of inventories. The assessment of the provision involves management judgment and estimates associated with expected disposition of the inventory. Refer to Note 7 for
information regarding inventories and write-downs of inventories.



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Allowance for doubtful accounts and revenue adjustments

During each reporting period, the Company makes an assessment of whether trade accounts receivable are collectible from customers. Accordingly, management
establishes an allowance for estimated losses arising from non-payment and other revenue adjustments, taking into consideration customer creditworthiness, current economic trends, past experience and credit
insurance coverage. The Company also records reductions to revenue for estimated returns, claims, customer rebates, and other incentives that are estimated based on historical experience, practices and current economic trends. If future collections
and trends differ from estimates, future earnings will be affected. Refer to Note 22 for more information regarding the allowance for doubtful accounts and the related credit risks.

Provisions

Provisions are recognized when the Company
has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period,
taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows, when the effect
of the time value of money is material.

Provisions of the Company include environmental and restoration obligations, litigation and termination benefits
and other provisions. Refer to Note 14 for more information regarding provisions.

Share-based payments

The estimation of share-based payment fair value and expense requires the selection of an appropriate pricing model.

The model used by the Company for the Executive Stock Option Plan (ESOP) and Stock Appreciation Rights Plan (SAR Plan) is the
Black-Scholes pricing model. The Black-Scholes model requires the Company to make significant judgments regarding the assumptions used within the model, the most significant of which are the expected volatility of the Companys own common
shares, the probable life of awards granted, the time of exercise, the risk-free interest rate commensurate with the term of the awards, and the expected dividend yield.

The model used by the Company for the Performance Share Unit Plan (PSU Plan) is the Monte Carlo simulation model. The Monte Carlo model requires
the Company to make significant judgments regarding the assumptions used within the model, the most significant of which are the volatility of the Companys own common shares as well as those of a peer group, the performance measurement period,
and the risk-free interest rate commensurate with the term of the awards.

Refer to Note 16 for more information regarding share-based payments.

Business acquisitions

Management uses various valuation
techniques when determining the fair values of certain assets and liabilities acquired in a business combination. Refer to Note 17 for more information regarding business acquisitions.

Financial Instruments

Financial assets and financial
liabilities are recognized when the Company becomes party to the contractual provisions of the financial instrument.



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Financial assets are derecognized when the contractual rights to the cash flows from the financial asset expire,
or when the financial asset and all substantial risks and rewards are transferred. A financial liability is derecognized when it is extinguished, discharged, cancelled or when it expires.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue
of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through earnings) are added or deducted from the fair value of the financial assets and financial liabilities, as appropriate, on
initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through earnings are recognized immediately in earnings.

In subsequent periods, the measurement of financial instruments depends on their classification. The classification of the Companys financial
instruments is presented in the following table:



|                                                                    |  |                                             
|------------------------------------------------------------------- |  | --------------------------------------------
|Category                                                            |  | Financial instruments                       
|                                                                    | 
|Financial assets measured at amortized cost                         |  | Cash                                        
|                                                                    |  | Trade receivables                           
|                                                                    |  | Supplier rebates and other receivables (1)  
|                                                                    | 
|Financial liabilities measured at amortized cost                    |  | Accounts payable and accrued liabilities (2)
|                                                                    |  | Borrowings (3)                              
|                                                                    | 
|Financial liabilities measured at fair value through earnings       |  | Non-controlling interest put options        
|                                                                    | 
|Derivative instruments in designated hedge accounting relationships |  | Interest rate swap agreements               



|(1) | Included in other current assets in the consolidated balance sheets
|--- | -------------------------------------------------------------------



|(2) | Excluding employee benefits
|--- | ---------------------------



|(3) | Excluding finance lease liabilities
|--- | -----------------------------------

Financial assets

Financial assets are classified and measured at amortized cost, less any impairment, if the purpose of the Companys business model is to hold the
financial assets for collecting cash flows and the contractual terms give rise to cash flows that are solely payments of principal and interest. Discounting is omitted where the effect of discounting is immaterial. The expense relating to the
allowance for doubtful accounts is recognized in earnings in selling, general and administrative expenses.

All financial assets are subject to review for
impairment at least at each reporting date. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated
future cash flows of that asset that can be estimated reliably.

Objective evidence that a financial asset or a group of financial assets is impaired
could include:



| |  |  | significant financial difficulty of the issuer or counterparty;
| | - |  | ---------------------------------------------------------------



| |  |  | default or delinquency in interest or principal payments;
| | - |  | ---------------------------------------------------------



| |  |  | it becomes probable that the borrower will enter bankruptcy or financial reorganization; or
| | - |  | -------------------------------------------------------------------------------------------



| |  |  | the disappearance of an active market for that financial asset because of financial difficulties.
| | - |  | -------------------------------------------------------------------------------------------------

Evidence of
impairment of trade receivables and other receivables is considered at both specific asset and collective levels taking into consideration customer creditworthiness, current economic trends, past



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experience and credit insurance coverage. Individually significant receivables are considered for impairment when they are past due or when other objective evidence is received that a specific
counterparty will default. Receivables that are not considered to be individually impaired are reviewed for impairment by grouping together receivables with similar risk categories.

In assessing collective impairment, the Company uses historical trends of the probability of default, timing of recoveries and the amount of the loss
incurred, adjusted for managements judgment as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than those suggested by historical trends.

Financial liabilities

Financial liabilities are measured
at amortized cost using the effective interest method except for financial liabilities at fair value through earnings. All interest related charges for financial liabilities measured at amortized costs are recognized in earnings in finance costs.
Discounting is omitted where the effect of discounting is immaterial.

Non-controlling interest put options that
are associated with the acquisition of Powerband are measured at fair value through earnings. Changes in the fair value of the non-controlling interest put options are recognized in earnings in finance costs.

Refer to Note 22 for more information regarding the fair value measurement and classification of these
non-controlling interest put options.

Derivative instruments and hedging

The Company applies hedge accounting to arrangements that qualify and are designated for hedge accounting treatment. All derivative financial instruments used
for hedge accounting are recognized initially at fair value and reported subsequently at fair value in the consolidated balance sheets. To the extent that the hedge is effective, changes in the fair value of the derivatives designated as hedging
instruments in cash flow hedges are recognized in other comprehensive income and are included within the reserve for cash flow hedge in equity. Any ineffectiveness in the hedge relationship is recognized immediately in earnings.

When the requirements for hedge accounting are met at inception, the Companys policy is to designate each derivative financial instrument as a hedging
instrument in a cash flow hedge relationship. Upon designation, the Company documents the relationships between the hedging instrument and the hedged item, including the risk management objectives and strategy in undertaking the hedge transaction,
and the methods that will be used to assess the effectiveness of the hedging relationship.

At inception of a hedge relationship and at each subsequent
reporting date, the Company evaluates if the hedging relationship qualifies for hedge accounting under IFRS 9 (2013), which includes the following conditions to be met:



| |  |  | There is an economic relationship between the hedged item and the hedging instrument;
| | - |  | -------------------------------------------------------------------------------------



| |  |  | The effect of credit risk does not dominate the value changes that result from that economic relationship; and
| | - |  | --------------------------------------------------------------------------------------------------------------



| |  |  | The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item that the entity actually hedges and the quantity of the hedging instrument that the entity actually uses to
hedge that quantity of hedged item.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Hedge accounting is discontinued prospectively when a derivative instrument ceases to satisfy the
conditions for hedge accounting, or is sold or liquidated. If the hedged item ceases to exist, unrealized gains or losses recognized in OCI are reclassified to earnings.



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The Company entered into interest rate swap agreements designated as cash flow hedges. Refer to Note 22 for more
information regarding interest rate swap agreements.

Revenue Recognition

Revenues are generated from the sale of goods.

Revenue is
recognized when the significant risks and rewards of ownership, legal title and effective control and management over the goods have transferred to the customer, collection of the relevant receivable is probable, the sales price is fixed and the
revenues and the associated incurred costs can be measured reliably. Revenue is recognized in accordance with the terms of sale, generally when goods are shipped to external customers.

Revenue is measured by reference to the fair value of the consideration received or receivable, net of estimated returns, rebates and discounts.

Research

Research expenses are expensed as they are
incurred, net of any related investment tax credits, unless the criteria for capitalization of development expenses are met.

Share-Based Compensation
Expense

The Company has adopted an ESOP, a SAR Plan, a PSU Plan and a Deferred Share Unit Plan (DSU Plan).

For the ESOP, the expense is based on the grant date fair value of the awards expected to vest over the vesting period. Forfeitures are estimated at the time
of the grant and are included in the measurement of the expense and are subsequently adjusted to reflect actual events.

For awards with graded vesting,
the fair value of each tranche is recognized on a straight-line basis over its vesting period.

Any consideration paid by participants on exercise of
stock options is credited to capital stock together with any related share-based compensation expense originally recorded in contributed surplus. If the amount of the tax deduction (or estimated future tax deduction) exceeds the amount of the
related cumulative remuneration expense for stock options, this indicates that the tax deduction relates not only to remuneration expense but also to an equity item. In this situation, the Company recognizes the excess of the associated current or
deferred tax to contributed surplus prior to an award being exercised, and any such amounts are transferred to capital stock upon exercise of the award.

For the SAR Plan, the expense is determined based on the fair value of the liability at the end of the reporting period. The expense is recognized over the
vesting period. At the end of each reporting period, the Company re-assesses its estimates of the number of awards that are expected to vest and recognizes the impact of the revisions in the consolidated
earnings statement.

For the PSU Plan, the expense is based on the grant date fair value of the awards expected to vest over the vesting period. The
expense is recorded on a straight-line basis over the vesting period. Forfeitures are estimated at the time of the grant and are included in the measurement of the expense and are subsequently adjusted to reflect actual events.

For the DSU Plan, the expense of Deferred Share Units (DSUs) received as a result of a grant is based on the closing price for the common shares
of the Company on the TSX on the date of the grant. The expense is recognized immediately. The expense of DSUs received in lieu of cash for directors fees is based on the fair value of services rendered. The expense is recognized as earned
over the service period.



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Refer to Note 16 for more information regarding share-based payments.

Earnings Per Share

Basic earnings per share is
calculated by dividing the net earnings attributable to Company shareholders by the weighted average number of common shares outstanding during the period, including the effect of stock options exercised, common shares repurchased under the normal
course issuer bid (NCIB) and DSUs outstanding.

Diluted earnings per share is calculated by dividing the net earnings attributable to Company
shareholders by the weighted average number of common shares outstanding during the period, including the effect of stock options exercised, common shares repurchased under the NICB and DSUs outstanding and for the effects of all dilutive potential
outstanding stock options and contingently issuable shares.

Dilutive potential outstanding stock options includes the total number of additional common
shares that would have been issued by the Company assuming stock options with exercise prices below the average market price for the year were exercised and reduced by the number of shares that the Company could have repurchased if it had used the
assumed proceeds from the exercise of stock options to repurchase them on the open market at the average share price for the period.

DSUs are not
contingently issuable shares since the shares are issuable solely after the passage of time. As such, DSUs are treated as outstanding and included in the calculation of weighted average basic common shares.

Performance share units (PSUs) are contingently issuable shares since the shares are issuable only after certain service and market-based performance conditions are satisfied. PSUs are treated as outstanding and included in the calculation of weighted average basic common shares only after the date when these conditions are satisfied at
the end of the vesting period. PSUs are treated as outstanding and included in the calculation of weighted average diluted common shares, to the extent they are dilutive, when the applicable performance conditions have been satisfied as of the
reporting period end date.

Inventories and Parts and Supplies

Raw materials, work in process and finished goods are measured at the lower of cost or net realizable value. Cost is assigned by using the first in, first out
cost formula, and includes all costs of purchases, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. Trade discounts, rebates and other similar items are deducted in determining the
costs of purchases. The cost of work in process and finished goods includes the cost of raw materials, direct labour and a systematic allocation of fixed and variable production overhead incurred in converting materials into finished goods. The
allocation of fixed production overheads to the cost of conversion is based on the normal capacity of the manufacturing facilities.

Net realizable value
is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated selling expenses.

Parts and
supplies are valued at the lower of cost which is equivalent to its purchase price or net realizable value based on replacement cost.

Property, Plant
and Equipment

Property, plant and equipment are carried at cost less accumulated depreciation, accumulated impairment losses and the applicable
investment tax credits earned. The cost of an item of property, plant and equipment comprises its purchase price, any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the
manner intended by management and, where applicable, borrowing costs and the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located.



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Depreciation is recognized using the straight-line method, over the estimated useful lives of like assets as
outlined below or, if lower, over the terms of the related leases:



|                                                     |  |                                     
|---------------------------------------------------- |  | ------------------------------------
|                                                     |  | Years                               
|Land                                                 |  | Indefinite                          
|Buildings and related major components               |  | 3 to 40                             
|Manufacturing equipment and related major components |  | 5 to 30                             
|Computer equipment and software                      |  | 3 to 15                             
|Furniture, office equipment and other                |  | 3 to 10                             
|Assets related to restoration provisions             |  | Expected remaining term of the lease

The depreciation methods, useful lives and residual values related to property, plant and equipment are reviewed at each
reporting date and adjusted if necessary.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as
separate items (major components) of property, plant and equipment, and are depreciated over their respective useful lives. Depreciation of an asset begins when it is available for use in the location and condition necessary for it to be capable of
operating in the manner intended by management. Manufacturing equipment under construction is not depreciated. Depreciation of an asset ceases at the earlier of the date on which the asset is classified as held for sale, or is included in a disposal
group that is classified as held for sale, and the date on which the asset is derecognized.

The cost of replacing a part of an item of property, plant
and equipment is recognized in the carrying amount of the asset if it is probable that the future economic benefits embodied within the part will flow to the Company, and its cost can be measured reliably. At the same time, the carrying amount of
the replaced part is derecognized. The costs of the day-to-day servicing of property, plant and equipment, and repairs and maintenance are recognized in earnings as
incurred.

Gains or losses arising on the disposal of property, plant and equipment are determined as the difference between the net disposal proceeds and
the carrying amount of the assets and are recognized in earnings in the category consistent with the function of the property, plant and equipment.

Depreciation expense is recognized in earnings in the expense category consistent with the function of the property, plant and equipment.

Intangible Assets

The Company has a trademark and
goodwill which are identifiable intangible assets for which the expected useful life is indefinite. The trademark represents the value of a brand name acquired in a business acquisition which management expects will provide benefit to the Company
for an indefinite period. Goodwill represents the excess of the purchase price over the fair value of the identifiable net assets acquired in business acquisitions. Intangible assets with indefinite useful lives that are acquired separately are
carried at cost.

When intangible assets are purchased with a group of assets, the cost of the group of assets is allocated to the individual identifiable
assets and liabilities on the basis of their relative fair values at the date of purchase. When intangible assets are purchased separately, the cost comprises its purchase price and any directly attributable cost of preparing the asset for its
intended use.



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Intangible assets are carried at cost less accumulated amortization and are amortized using the straight-line
method, over their estimated useful lives as follows:



|                                                |  |                
|----------------------------------------------- |  | ---------------
|                                                |  | Years          
|Distribution rights and customer contracts      |  | 6 to 15        
|Customer lists, license agreements and software |  | 5              
|Patents and trademarks                          |  | 5 to indefinite
|Non-compete agreements                          |  | 3 to 10        

The amortization methods, useful lives and residual values related to intangible assets are reviewed and adjusted if necessary
at each financial year-end. Amortization begins when the asset is available for use, i.e. when it is in the location and condition necessary for it to be capable of operating in the manner intended by
management. Amortization expense is recognized in earnings in the expense category consistent with the function of the intangible asset.

Borrowing
Costs

Borrowing costs, directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of
time to get ready for its intended use, are capitalized as part of the cost of the asset. All other borrowing costs are recognized in earnings within interest in the period in which they are incurred. Borrowing costs consist of interest and other
costs incurred in connection with the borrowing of funds.

Impairment Testing of Intangible Assets, Goodwill and Property, Plant and Equipment

The Company assesses, at least at each reporting date, whether or not there is an indication that a CGU may be impaired. If such an indication exists, or when
annual impairment testing is required for intangible assets, such as applications software not yet available for use and the trademark with an indefinite useful life, the Company estimates the recoverable amount of the asset. The recoverable amount
is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of other assets or groups of assets. In the latter case, the recoverable amount is determined for a CGU which is the smallest
identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or group of assets. Goodwill is allocated to those CGUs that are expected to benefit from synergies of related business
acquisitions and represent the lowest level within the group at which management monitors goodwill.

The recoverable amount is the higher of its value in
use and its fair value less costs to sell. Value in use is the present value of the future cash flows expected to be derived from an asset or CGU. Fair value less costs to sell is the price that would be received to sell an asset or CGU in an
orderly transaction between market participants, less the cost of disposal. The Company determines the recoverable amount and compares it with the carrying amount. If the carrying amount exceeds the recoverable amount, an impairment loss is
recognized for the difference. Impairment losses are recognized in earnings in the expense category consistent with the function of the corresponding property, plant and equipment or intangible asset. Impairment losses recognized in respect of CGUs
are allocated to reduce the carrying amounts of the assets of the unit or group of units pro rata based on the carrying amount of each asset in the unit or group of units.

With the exception of goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognized impairment
losses may no longer exist or may have decreased. In this case, the Company will estimate the recoverable amount of that asset, and if appropriate, record a partial or an entire reversal of the impairment. The increased carrying amount of an asset
attributable to a reversal of an impairment loss would not exceed the carrying amount that would have been determined (net of amortization or depreciation) had no impairment loss been recognized for the asset in prior years.

Goodwill is subject to impairment testing at least once a year, or more frequently if events or changes in circumstances indicate the carrying amount may be
impaired. Goodwill is considered to be impaired when the carrying amount of the CGU or group of CGUs to which the goodwill has been allocated exceeds its fair value. An impairment loss, if any, would be recognized in the statement of earnings.



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Provisions

Provisions represent liabilities to the Company for which the amount or timing is uncertain. Provisions are recognized if, as a result of a past event, the
Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. The amount recognized as a provision is the best estimate of
the expenditure required to settle the present obligation at the end of the reporting period. Provisions are measured at the present value of the expected expenditures to settle the obligation which, when the effect of the time value of money is
material, is determined using a discount rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision during the period to reflect the passage of time is recognized
in earnings as a finance cost.

A provision is recorded in connection with the estimated future costs to restore a leased property to its original
condition at the inception of the lease agreement. The liability and a corresponding asset are recorded on the Companys consolidated balance sheet under the captions provisions, and property, plant and equipment (machinery and equipment),
respectively. The provision is reviewed at the end of each reporting period to reflect the passage of time, changes in the discount rate and changes in the estimated future restoration costs. The Company amortizes the amount capitalized to property,
plant and equipment on a straight-line basis over the expected lease term and recognizes a financial cost in connection with the discounted liability over the same period. Changes in the liability are added to, or deducted from, the cost of the
related asset in the current period. These changes to the capitalized cost result in an adjustment to depreciation and interest.

A provision is recorded
in connection with environmental expenditures relating to existing conditions caused by past operations that do not contribute to current or future revenues. Provisions for liabilities related to anticipated remediation costs are recorded on a
discounted basis, if the effects of discounting are material, when they are probable and reasonably estimable, and when a present obligation exists as a result of a past event. Environmental expenditures for capital projects that contribute to
current or future operations generally are capitalized and depreciated over their estimated useful lives.

A provision is recorded in connection with
termination benefits at the earlier of the date on which the Company can no longer withdraw the offer of those benefits and the date on which the Company recognizes costs related to restructuring activities. In the case of an offer made to encourage
voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept the offer. If benefits are not expected to be settled wholly within 12 months of the end of the reporting period, they are presented on a
discounted basis.

Pension, Post-Retirement and Other Long-term Employee Benefits

The Company has defined contribution plans, defined benefit pension plans, other post-retirement benefit plans, and other long-term employee benefit plans for
certain of its employees in Canada and the US.

A defined contribution plan is a post-retirement benefit plan under which the Company pays fixed
contributions into a separate entity and to which it will have no legal or constructive obligation to pay future amounts. The Company contributes to several state plans, multi-employer plans and insurance funds for individual employees that are
considered defined contribution plans. Contributions to defined contribution pension plans are recognized as an employee benefit expense in earnings in the periods during which services are rendered by employees.

A defined benefit plan is a post-retirement benefit plan other than a defined contribution plan. For defined benefit pension plans, other post-retirement
benefit plans and other long-term employee benefit plans, the benefits expense and the related obligations are actuarially determined on an annual basis by independent qualified actuaries using the projected unit credit method when the effects of
discounting are significant. Past service costs are recognized as an expense in earnings immediately following the introduction of, or changes to, a pension plan. Remeasurements, comprising actuarial gains and losses, the effect of the asset
ceiling, the effect of minimum funding requirements and the return on plan assets (excluding amounts included in net interest expense) are recognized immediately in OCI, net of income taxes, and in deficit.



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The asset or liability related to a defined benefit plan recognized in the balance sheet is the present value of
the defined benefit obligation at the end of the reporting period, less the fair value of plan assets, together with adjustments for the asset ceiling and minimum funding liabilities. The present value of the defined benefit obligation is determined
by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid and that have terms to maturity approximating the terms of the related
pension liability.

For funded plans, surpluses are recognized only to the extent that the surplus is considered recoverable. Recoverability is primarily
based on the extent to which the Company can unilaterally reduce future contributions to the plan. Any reduction in the recognized asset is recognized in OCI, net of income taxes, and in deficit.

An additional liability is recognized based on the minimum funding requirement of a plan when the Company does not have an unconditional right to the plan
surplus. The liability and any subsequent remeasurement of that liability is recognized in OCI, net of income taxes, and in deficit.

Leases

Leases are classified as either operating or finance, based on the substance of the transaction at inception of the lease. Classification is re-assessed if the terms of the lease are changed other than by renewing the lease.

Leases in which a significant
portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Expenses under an operating lease are recognized in earnings on a straight-line basis over the period of the lease.

Leases in which substantially all the risks and rewards of ownership are transferred to the Company are classified as finance leases. Assets meeting finance
lease criteria are capitalized at the lower of the present value of the related lease payments or the fair value of the leased asset at the inception of the lease. Minimum lease payments are apportioned between the finance cost and the liability.
The finance charge is recognized in earnings in finance costs and is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Income Taxes

Income tax expense (benefit) comprises both
current and deferred tax. Current and deferred tax is recognized in earnings except to the extent it relates to items recognized in OCI or directly in equity. When it relates to the latter items, the income tax is recognized in OCI or directly in
equity, respectively.

Current tax is based on the results for the period as adjusted for items that are not taxable or deductible. Current tax is
calculated using tax rates and laws enacted or substantially enacted at the reporting date in the countries in which the Company operates and generates taxable income.

Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulations are subject to interpretation.
Provisions are established where appropriate on the basis of amounts expected to be paid to the taxing authorities.

Deferred tax is recognized in respect
of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the balance sheet. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences to the
extent that it is probable that future taxable income will be available against which they can be utilized. Deferred tax is calculated using tax rates and laws enacted or substantially enacted at the reporting date in the countries where the Company
operates, and which are expected to apply when the related deferred income tax asset is realized or the deferred tax liability is settled.



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The carrying amounts of deferred tax assets are reviewed at each reporting period and reduced to the extent that
it is no longer probable that sufficient taxable income will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are reassessed at each reporting period and are recognized to the extent that
it has become probable that future taxable income will allow the deferred tax asset to be recovered.

Deferred tax assets and deferred tax liabilities are
offset only if a legally enforceable right exists to set off the recognized amounts and the deferred taxes relate to the same taxable entity and the same taxation authority.

Equity

Capital stock represents the amount received on
issuance of shares (less any issuance costs and net of taxes), share-based compensation expense credited to capital on stock options exercised and common shares repurchased equal to the carrying value. Contributed surplus includes amounts related to
stock options, PSUs and DSUs until such equity instruments are exercised or settled, in which case the amounts are transferred to capital stock or reversed upon forfeiture if not vested. Foreign currency translation differences arising on the
translation of the consolidated entities that use a functional currency different from the presentation currency are included in the cumulative translation adjustment account. Gains and losses on certain derivative financial instruments designated
as hedging instruments are included in reserves for cash flow hedges until such time as the hedged forecasted cash flows affect earnings. Deficit includes all current and prior period earnings or losses, the excess of the purchase price paid over
the carrying value of common share repurchases, dividends on common shares and remeasurement of defined benefit liability net of income tax expense (benefit).

Non-controlling interest

Non-controlling interest represents the equity in subsidiaries that are not attributable, directly or indirectly, to
the Parent Company. A non-controlling interest is initially recognized as the proportionate share of the identifiable net assets of the subsidiary on the date of its acquisition and is subsequently adjusted
for the non-controlling interests share in changes of the acquired subsidiarys earnings and capital, as well as changes in foreign currency exchange rates where applicable. Effects of transactions
with the non-controlling interest are recorded in equity if there is no change in control. The Company attributes total comprehensive income or loss of subsidiaries between the shareholders of the Parent
Company and the non-controlling interest based on their respective ownership interests.

Share Repurchases

The purchase price of the common shares repurchased equal to its carrying value is recorded in capital stock in the consolidated balance sheet and in
the statement of consolidated changes in equity. The excess of the purchase price paid over the carrying value of the common shares repurchased is recorded in deficit in the consolidated balance sheet and in the statement of consolidated changes in
equity as a share repurchase premium.

Dividends

Dividend distributions to the Companys shareholders are recognized as a liability in the consolidated balance sheets if not paid in the period in which
dividends are approved by the Companys Board of Directors.

Standards Issued and Not Yet Effective but Adopted Early

On January 1, 2015, the Company adopted and implemented IFRS 9 (2013) - Financial Instruments. This standard replaces IAS 39 - Financial Instruments:
Recognition and Measurement and previous versions of IFRS 9. IFRS 9 (2013) includes revised guidance on the classification and measurement of financial assets and liabilities and introduces a new general hedge accounting model which aims to better
align a companys hedge accounting with risk management.



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##### Table of Contents

New Standards and Interpretations Issued but Not Yet Effective

Certain new standards, amendments and interpretations, and improvements to existing standards have been published by the IASB but are not yet effective, and
have not been adopted early by the Company. Management anticipates that all of the relevant pronouncements will be adopted in the first reporting period following the date of application. Information on new standards, amendments and interpretations,
and improvements to existing standards, which could potentially impact the Companys consolidated financial statements, are detailed as follows:

IFRS 15  Revenue from Contracts with Customers replaces IAS 18  Revenue, IAS 11  Construction Contracts and some revenue related
interpretations. IFRS 15 establishes a new control-based revenue recognition model, changes the basis for deciding when revenue is recognized at a point in time or over time, provides new and more detailed guidance on specific topics and expands and
improves disclosures about revenue. IFRS 15 is effective for annual reporting periods beginning on or after January 1, 2018. Management has performed a preliminary review of the new guidance as compared to its current accounting policies, and
began a review of its sales contracts. Based on its initial evaluation, Management does not expect the new guidance to materially impact the Companys consolidated financial statements. In 2017, Management plans to finalize its review and
determine the method of adoption.

IFRS 9 (2014) - Financial Instruments was issued in July 2014 and differs in some regards from IFRS 9 (2013) which the
Company adopted effective January 1, 2015. IFRS 9 (2014) includes updated guidance on the classification and measurement of financial assets. The final standard also amends the impairment model by introducing a new expected credit loss model
for calculating impairment. The mandatory effective date of IFRS 9 (2014) is for annual periods beginning on or after January 1, 2018 and must be applied retrospectively with some exemptions. Early adoption is permitted. Based on its initial
evaluation, management does not expect the new guidance to materially impact the Companys consolidated financial statements. In 2017, management plans to finalize its review and determine the method of adoption.

IFRS 16 - Leases which will replace IAS 17 - Leases was issued in January 2016. IFRS 16 eliminates the classification of an operating lease and requires
lessees to recognize a right-of-use asset and a lease liability in the statement of financial position for all leases with exemptions permitted for short-term leases and
leases of low value assets. In addition, IFRS 16 changes the definition of a lease; sets requirements on how to account for the asset and liability, including complexities such as non-lease elements, variable
lease payments and option periods; changes the accounting for sale and leaseback arrangements; largely retains IAS 17s approach to lessor accounting and introduces new disclosure requirements. IFRS 16 is effective for annual reporting periods
beginning on or after January 1, 2019 with early application permitted in certain circumstances. Management is currently assessing but has not yet determined the impact of this new standard on the Companys consolidated financial
statements.

Certain other new standards and interpretations have been issued but are not expected to have a material impact on the Companys
consolidated financial statements.



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3 -INFORMATION INCLUDED IN CONSOLIDATED EARNINGS

The following table describes the charges incurred by the Company, which are included in the Companys consolidated earnings for each of the years in the
three-year period ended December 31, 2016:



|                                                                               |  |      |         |   |      |  |         |      |  |  |         |  
|------------------------------------------------------------------------------ |  | ---- | ------- | - | ---- |  | ------- | ---- |  |  | ------- | -
|                                                                               |  | 2016 |         |   | 2015 |  |         | 2014 | 
|                                                                               |  | $    |         |   | $    |  |         | $    | 
|Employee benefit expense                                                       |  |      |         |   |      |  |         |      |  |  |         |  
|Wages, salaries and other short-term benefits                                  |  |      | 161,661 |   |      |  | 149,472 |      |  |  | 140,098 |  
|Termination benefits (Note 15)                                                 |  |      | 1,733   |   |      |  | 987     |      |  |  | 2,297   |  
|Stock-based compensation expense                                               |  |      | 8,201   |   |      |  | 3,249   |      |  |  | 6,185   |  
|Pension, post-retirement and other long-term employee benefit plans (Note 18): |  |      |         |   |      |  |         |      |  |  |         |  
|Defined benefit plans                                                          |  |      | 3,002   |   |      |  | 2,750   |      |  |  | 4,597   |  
|Defined contributions plans                                                    |  |      | 4,631   |   |      |  | 4,016   |      |  |  | 3,606   |  
|                                                                               |  |      |         |   |      |  |         |      |  |  |         |  
|                                                                               |  |      | 179,228 |   |      |  | 160,474 |      |  |  | 156,783 |  
|                                                                               |  |      |         |   |      |  |         |      |  |  |         |  
|Finance costs - Interest                                                       |  |      |         |   |      |  |         |      |  |  |         |  
|Interest on borrowings                                                         |  |      | 4,770   |   |      |  | 3,737   |      |  |  | 3,763   |  
|Amortization of debt issue costs on borrowings                                 |  |      | 445     |   |      |  | 473     |      |  |  | 1,993   |  
|Interest capitalized to property, plant and equipment                          |  |      | (817    | ) |      |  | (657    | )    |  |  | (1,125  | )
|                                                                               |  |      |         |   |      |  |         |      |  |  |         |  
|                                                                               |  |      | 4,398   |   |      |  | 3,553   |      |  |  | 4,631   |  
|                                                                               |  |      |         |   |      |  |         |      |  |  |         |  
|Finance costs - Other expense (income) , net Foreign exchange (gain) loss      |  |      | (518    | ) |      |  | (1,287  | )    |  |  | 541     |  
|                                                                               |  |      |        
|Other costs, net                                                               |  |      | 1,123   |   |      |  | 894     |      |  |  | 987     |  
|                                                                               |  |      |         |   |      |  |         |      |  |  |         |  
|                                                                               |  |      | 605     |   |      |  | (393    | )    |  |  | 1,528   |  
|                                                                               |  |      |         |   |      |  |         |      |  |  |         |  
|Additional information                                                         |  |      |         |   |      |  |         |      |  |  |         |  
|Depreciation of property, plant and equipment (Note 9)                         |  |      | 29,402  |   |      |  | 29,857  |      |  |  | 25,498  |  
|Amortization of intangible assets (Note 11)                                    |  |      | 1,890   |   |      |  | 1,023   |      |  |  | 671     |  
|Impairment (reversal of impairment) of assets (Note 12)                        |  |      | 7,062   |   |      |  | (380    | )    |  |  | 525     |  



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4 -MANUFACTURING FACILITY CLOSURES, RESTRUCTURING AND OTHER RELATED CHARGES

The following table describes the charges incurred by the Company, which are included in the Companys consolidated earnings for each of the years in the
three-year period ended December 31, 2016 under the caption manufacturing facility closures, restructuring and other related charges:



|                                                                     |  |                 |       |  |                    |  |        |               |  |  |       |   |  |  |        |  
|-------------------------------------------------------------------- |  | --------------- | ----- |  | ------------------ |  | ------ | ------------- |  |  | ----- | - |  |  | ------ | -
|                                                                     |  | 2016            |      
|                                                                     |  | TaraTapeClosure |       |  | SouthCarolinaFlood |  |        | Otherprojects |  |  | Total |  
|                                                                     |  | $               |       |  | $                  |  |        | $             |  |  | $     |  
|Impairment (reversal of impairment) of property, plant and equipment |  |                 | 2,528 |  |                    |  | 620    |               |  |  | (130  | ) |  |  | 3,018  |  
|Impairment of intangibles                                            |  |                 | 379   |  |                    |  |       |               |  |  |      |   |  |  | 379    |  
|Equipment relocation                                                 |  |                 |      |  |                    |  |       |               |  |  | 711   |   |  |  | 711    |  
|Revaluation and impairment of inventories                            |  |                 | 725   |  |                    |  | 695    |               |  |  |      |   |  |  | 1,420  |  
|Termination benefits and other labor related costs                   |  |                 | 1,071 |  |                    |  | 64     |               |  |  | 630   |   |  |  | 1,765  |  
|Restoration and idle facility costs                                  |  |                 | 1,008 |  |                    |  | 2,656  |               |  |  | 123   |   |  |  | 3,787  |  
|Insurance proceeds                                                   |  |                 |      |  |                    |  | (9,793 | )             |  |  |      |   |  |  | (9,793 | )
|Professional fees                                                    |  |                 | 67    |  |                    |  | 875    |               |  |  |      |   |  |  | 942    |  
|Other costs                                                          |  |                 | 179   |  |                    |  |       |               |  |  |      |   |  |  | 179    |  
|                                                                     |  |                 |       |  |                    |  |        |               |  |  |       |   |  |  |        |  
|                                                                     |  |                 | 5,957 |  |                    |  | (4,883 | )             |  |  | 1,334 |   |  |  | 2,408  |  
|                                                                     |  |                 |       |  |                    |  |        |               |  |  |       |   |  |  |        |  



|                                                                     |  |                    |        |   |               |  |       |       |  |  |                      |   |  |               |       |   |       |  |       |  |  |  |       |  
|-------------------------------------------------------------------- |  | ------------------ | ------ | - | ------------- |  | ----- | ----- |  |  | -------------------- | - |  | ------------- | ----- | - | ----- |  | ----- |  |  |  | ----- | -
|                                                                     |  | 2015               |        |   | 2014          | 
|                                                                     |  | SouthCarolinaFlood |        |   | Otherprojects |  |       | Total |  |  | SouthCarolinaProject |   |  | Otherprojects |       |   | Total | 
|                                                                     |  | $                  |        |   | $             |  |       | $     |  |  | $                    |   |  | $             |       |   | $     | 
|Impairment (reversal of impairment) of property, plant and equipment |  |                    | 923    |   |               |  | 64    |       |  |  | 987                  |   |  |               | (481  | ) |       |  | 226   |  |  |  | (255  | )
|Impairment (reversal of impairment)                                  |  |                    |        |   |               |  |       |       |  |  |                      |   |  |               |       |   |       |  |       |  |  |  |       |  
|of parts and supplies                                                |  |                    | 11     |   |               |  | (56   | )     |  |  | (45                  | ) |  |               |      |   |       |  | 77    |  |  |  | 77    |  
|Equipment relocation                                                 |  |                    |       |   |               |  | 190   |       |  |  | 190                  |   |  |               | 2,062 |   |       |  | 462   |  |  |  | 2,524 |  
|Revaluation and impairment of inventories                            |  |                    | 3,614  |   |               |  | 110   |       |  |  | 3,724                |   |  |               | 42    |   |       |  | 54    |  |  |  | 96    |  
|Termination benefits and other labor related costs                   |  |                    | 88     |   |               |  | 1,294 |       |  |  | 1,382                |   |  |               | 1,559 |   |       |  | 271   |  |  |  | 1,830 |  
|Restoration and idle facility costs                                  |  |                    | 1,465  |   |               |  | 218   |       |  |  | 1,683                |   |  |               |      |   |       |  | 632   |  |  |  | 632   |  
|Insurance proceeds                                                   |  |                    | (5,000 | ) |               |  |      |       |  |  | (5,000               | ) |  |               |      |   |       |  |      |  |  |  |      |  
|Professional fees                                                    |  |                    | 273    |   |               |  |      |       |  |  | 273                  |   |  |               | 18    |   |       |  | 3     |  |  |  | 21    |  
|Other costs                                                          |  |                    | 157    |   |               |  | 315   |       |  |  | 472                  |   |  |               |      |   |       |  | 2     |  |  |  | 2     |  
|                                                                     |  |                    |        |   |               |  |       |       |  |  |                      |   |  |               |       |   |       |  |       |  |  |  |       |  
|                                                                     |  |                    | 1,531  |   |               |  | 2,135 |       |  |  | 3,666                |   |  |               | 3,200 |   |       |  | 1,727 |  |  |  | 4,927 |  
|                                                                     |  |                    |        |   |               |  |       |       |  |  |                      |   |  |               |       |   |       |  |       |  |  |  |       |  

As part of its plan to realize operational synergies from the TaraTape acquisition completed in November 2015, the Company set
out a plan to close its Fairless Hills, Pennsylvania manufacturing facility and ceased production as of December 31, 2016 (TaraTape Closure). In order to accommodate the related production volume, the Company has leveraged
production capacity, and will continue to do so, in both its Carbondale, Illinois and Danville, Virginia manufacturing facilities.

On October 4,
2015, the Columbia, South Carolina manufacturing facility was damaged by significant rainfall and subsequent severe flooding (South Carolina Flood). The damages sustained were considerable and resulted in the facility being shut down
permanently. Losses incurred as a result of the South Carolina Flood include real and personal property damage, business interruption losses (including, but not limited to, lost sales and temporary alternative sourcing of the Companys
products), site clean-up and environmental remediation costs, and professional fee costs related to the insurance claim process. On October 19, 2016, the Company and its insurers reached a settlement for
the outstanding property



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##### Table of Contents

and business interruption claims in the amount of $30.0 million, subject to a $0.5 million deductible, covering substantially all of the claimed losses. As of December 31, 2016,
the Company received a total of $29.5 million in insurance claim settlement proceeds of which $5.0 million was recorded in manufacturing facility closures, restructuring and other related charges (presented in the table above under
insurance proceeds) in 2015 and $12.6 million and $9.8 million were recorded in cost of sales and manufacturing facility closures, restructuring and other related charges, respectively, in 2016. The remaining $2.1 million is included
in accounts payable and accrued liabilities in the consolidated balance sheet as of December 31, 2016 and will be recognized as a benefit to gross profit in the first quarter of 2017.

On February 26, 2013, the Company announced its intention to relocate its Columbia, South Carolina manufacturing facility within the region in order to
modernize facility operations and acquire state-of-the-art manufacturing equipment (South Carolina Project). The
incremental costs of relocating the Columbia, South Carolina manufacturing facility are included in the table above under Other projects for 2016 and 2015.

On June 26, 2012, the Company announced its intention to close its Richmond, Kentucky manufacturing facility (which was sold in December 2015), and
consolidate its shrink film production from Truro, Nova Scotia to Tremonton, Utah, as well as other small restructuring initiatives. The majority of products produced in the Richmond, Kentucky facility were transferred to the Companys
Carbondale, Illinois facility. The incremental costs of the Richmond, Kentucky manufacturing facility closure, consolidation of the shrink film production from Truro, Nova Scotia to Tremonton, Utah and other small restructuring initiatives are set
out in the table above under Other projects.

As of December 31, 2016, $3.7 million is included in provisions ($3.0 million in 2015) and
$0.5 million in accounts payable and accrued liabilities ($1.6 million in 2015) for restructuring provisions. See Note 14 for more information on provisions.

5 -INCOME TAXES

The reconciliation
of the combined Canadian federal and provincial statutory income tax rate to the Companys effective income tax rate is detailed as follows for each of the years in the three-year period ended December 31, 2016:



|                                                         |  |      |      |   |      |  |      |      |  |  |      |  
|-------------------------------------------------------- |  | ---- | ---- | - | ---- |  | ---- | ---- |  |  | ---- | -
|                                                         |  | 2016 |      |   | 2015 |  |      | 2014 | 
|                                                         |  | %    |      |   | %    |  |      | %    | 
|Combined Canadian federal and provincial income tax rate |  |      | 29.5 |   |      |  | 29.5 |      |  |  | 28.5 |  
|Foreign earnings/losses taxed at higher income tax rates |  |      | 6.6  |   |      |  | 5.8  |      |  |  | 9.7  |  
|Foreign earnings/losses taxed at lower income tax rates  |  |      | (0.7 | ) |      |  | (1.0 | )    |  |  | (0.1 | )
|Legal entity reorganization                              |  |      |     |   |      |  | (0.0 | )    |  |  | 5.6  |  
|Change in statutory rates                                |  |      | 0.4  |   |      |  | (1.6 | )    |  |  | (0.2 | )
|Prior period adjustments                                 |  |      | 0.0  |   |      |  | (3.1 | )    |  |  | 0.1  |  
|Nondeductible expenses                                   |  |      | 0.7  |   |      |  | 0.7  |      |  |  | 1.7  |  
|Impact of other differences                              |  |      | (2.7 | ) |      |  | (1.1 | )    |  |  | (0.0 | )
|Nontaxable dividend                                      |  |      | (6.9 | ) |      |  | (7.6 | )    |  |  | (1.6 | )
|Change in derecognition of deferred tax assets           |  |      | 0.8  |   |      |  | (5.4 | )    |  |  | (4.7 | )
|                                                         |  |      |      |   |      |  |      |      |  |  |      |  
|Effective income tax rate                                |  |      | 27.7 |   |      |  | 16.2 |      |  |  | 39.0 |  
|                                                         |  |      |      |   |      |  |      |      |  |  |      |  



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##### Table of Contents

The major components of income tax expense (benefit) are outlined below for each of the years in the three-year
period ended December 31, 2016:



|                                                            |  |      |        |   |      |  |        |      |  |  |        |  
|----------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | ---- |  |  | ------ | -
|                                                            |  | 2016 |        |   | 2015 |  |        | 2014 | 
|                                                            |  | $    |        |   | $    |  |        | $    | 
|Current income tax expense                                  |  |      | 8,757  |   |      |  | 8,185  |      |  |  | 3,665  |  
|                                                            |  |      |        |   |      |  |        |      |  |  |        |  
|Deferred tax expense (benefit)                              |  |      |        |   |      |  |        |      |  |  |        |  
|Derecognition (recognition) of US deferred tax assets       |  |      | 175    |   |      |  | (113   | )    |  |  | 114    |  
|US temporary differences                                    |  |      | 10,818 |   |      |  | 7,794  |      |  |  | 19,411 |  
|Derecognition (recognition) of Canadian deferred tax assets |  |      | 330    |   |      |  | (3,847 | )    |  |  | (2,872 | )
|Canadian temporary differences                              |  |      | (352   | ) |      |  | (1,095 | )    |  |  | 2,579  |  
|Temporary differences in other jurisdictions                |  |      | (159   | ) |      |  | 59     |      |  |  | 6      |  
|                                                            |  |      |        |   |      |  |        |      |  |  |        |  
|Total deferred income tax expense                           |  |      | 10,812 |   |      |  | 2,798  |      |  |  | 19,238 |  
|                                                            |  |      |        |   |      |  |        |      |  |  |        |  
|Total tax expense for the year                              |  |      | 19,569 |   |      |  | 10,983 |      |  |  | 22,903 |  
|                                                            |  |      |        |   |      |  |        |      |  |  |        |  

The amount of income taxes relating to components of other comprehensive income (loss) for each of the years in the three-year
period ended December 31, 2016 are outlined below:



|                                                                                                             |  |                         |         |   |                      |  |       |                           |  |  |        |  
|------------------------------------------------------------------------------------------------------------ |  | ----------------------- | ------- | - | -------------------- |  | ----- | ------------------------- |  |  | ------ | -
|                                                                                                             |  | Amount beforeincome tax |         |   | Deferredincome taxes |  |       | Amount net ofincome taxes | 
|                                                                                                             |  | $                       |         |   | $                    |  |       | $                         | 
|For the year ended December 31, 2016                                                                         |  |                         |         |   |                      |  |       |                           |  |  |        |  
|Deferred tax expense on remeasurement of defined benefit liability                                           |  |                         | 267     |   |                      |  | (66   | )                         |  |  | 201    |  
|Deferred tax expense on change in fair value of interest rate swap agreements designated as cash
flow hedges |  |                         | 219     |   |                      |  | (83   | )                         |  |  | 136    |  
|                                                                                                             |  |                         |         |   |                      |  |       |                           |  |  |        |  
|                                                                                                             |  |                         | 486     |   |                      |  | (149  | )                         |  |  | 337    |  
|                                                                                                             |  |                         |         |   |                      |  |       |                           |  |  |        |  
|For the year ended December 31, 2015                                                                         |  |                         |         |   |                      |  |       |                           |  |  |        |  
|Deferred tax expense on remeasurement of defined benefit liability                                           |  |                         | 2,550   |   |                      |  | (964  | )                         |  |  | 1,586  |  
|Deferred tax benefit on change in fair value of interest rate swap agreements designated as cash
flow hedges |  |                         | (438    | ) |                      |  | 166   |                           |  |  | (272   | )
|                                                                                                             |  |                         |         |   |                      |  |       |                           |  |  |        |  
|                                                                                                             |  |                         | 2,112   |   |                      |  | (798  | )                         |  |  | 1,314  |  
|                                                                                                             |  |                         |         |   |                      |  |       |                           |  |  |        |  
|For the year ended December 31, 2014                                                                         |  |                         |         |   |                      |  |       |                           |  |  |        |  
|Deferred tax benefit on remeasurement of defined benefit liability                                           |  |                         | (10,703 | ) |                      |  | 3,894 |                           |  |  | (6,809 | )
|Deferred tax expense on funding requirement changes of defined benefit plans                                 |  |                         | 2,497   |   |                      |  | (711  | )                         |  |  | 1,786  |  
|                                                                                                             |  |                         |         |   |                      |  |       |                           |  |  |        |  
|                                                                                                             |  |                         | (8,206  | ) |                      |  | 3,183 |                           |  |  | (5,023 | )
|                                                                                                             |  |                         |         |   |                      |  |       |                           |  |  |        |  



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##### Table of Contents

The amount of recognized deferred tax assets and liabilities are outlined below:



|                                                            |  |                    |        |  |                         |  |         |     |  |  |         |  
|----------------------------------------------------------- |  | ------------------ | ------ |  | ----------------------- |  | ------- | --- |  |  | ------- | -
|                                                            |  | Deferred taxassets |        |  | Deferred taxliabilities |  |         | Net | 
|                                                            |  | $                  |        |  | $                       |  |         | $   | 
|As of December 31, 2016                                     |  |                    |        |  |                         |  |         |     |  |  |         |  
|Tax credits, losses, carryforwards and other tax deductions |  |                    | 15,689 |  |                         |  |        |     |  |  | 15,689  |  
|Property, plant and equipment                               |  |                    | 18,125 |  |                         |  | (30,078 | )   |  |  | (11,953 | )
|Pension and other post-retirement benefits                  |  |                    | 11,467 |  |                         |  |        |     |  |  | 11,467  |  
|Stock-based payments                                        |  |                    | 8,749  |  |                         |  |        |     |  |  | 8,749   |  
|Accounts payable and accrued liabilities                    |  |                    | 6,893  |  |                         |  |        |     |  |  | 6,893   |  
|Goodwill and other intangibles                              |  |                    | 3,658  |  |                         |  | (9,885  | )   |  |  | (6,227  | )
|Trade and other receivables                                 |  |                    | 353    |  |                         |  |        |     |  |  | 353     |  
|Inventories                                                 |  |                    | 2,871  |  |                         |  |        |     |  |  | 2,871   |  
|Other                                                       |  |                    | 539    |  |                         |  | (1,102  | )   |  |  | (563    | )
|                                                            |  |                    |        |  |                         |  |         |     |  |  |         |  
|Deferred tax assets and liabilities                         |  |                    | 68,344 |  |                         |  | (41,065 | )   |  |  | 27,279  |  
|                                                            |  |                    |        |  |                         |  |         |     |  |  |         |  

Presented in the consolidated balance sheets as:

|                         |  |                  |        |  
|------------------------ |  | ---------------- | ------ | -
|                         |  | December 31,2016 |       
|                         |  | $                |       
|Deferred tax assets      |  |                  | 36,611 |  
|Deferred tax liabilities |  |                  | (9,332 | )
|                         |  |                  |        |  
|                         |  |                  | 27,279 |  
|                         |  |                  |        |  



|                                                            |  |                    |        |  |                         |  |         |     |  |  |        |  
|----------------------------------------------------------- |  | ------------------ | ------ |  | ----------------------- |  | ------- | --- |  |  | ------ | -
|                                                            |  | Deferred taxassets |        |  | Deferred taxliabilities |  |         | Net | 
|                                                            |  | $                  |        |  | $                       |  |         | $   | 
|As of December 31, 2015                                     |  |                    |        |  |                         |  |         |     |  |  |        |  
|Tax credits, losses, carryforwards and other tax deductions |  |                    | 20,319 |  |                         |  |        |     |  |  | 20,319 |  
|Property, plant and equipment                               |  |                    | 16,801 |  |                         |  | (17,851 | )   |  |  | (1,050 | )
|Pension and other post-retirement benefits                  |  |                    | 10,838 |  |                         |  |        |     |  |  | 10,838 |  
|Stock-based payments                                        |  |                    | 6,409  |  |                         |  |        |     |  |  | 6,409  |  
|Accounts payable and accrued liabilities                    |  |                    | 4,453  |  |                         |  |        |     |  |  | 4,453  |  
|Goodwill and other intangibles                              |  |                    | 3,464  |  |                         |  | (2,118  | )   |  |  | 1,346  |  
|Trade and other receivables                                 |  |                    | 1,698  |  |                         |  |        |     |  |  | 1,698  |  
|Inventories                                                 |  |                    | 1,682  |  |                         |  |        |     |  |  | 1,682  |  
|Other                                                       |  |                    | 583    |  |                         |  | (970    | )   |  |  | (387   | )
|                                                            |  |                    |        |  |                         |  |         |     |  |  |        |  
|Deferred tax assets and liabilities                         |  |                    | 66,247 |  |                         |  | (20,939 | )   |  |  | 45,308 |  
|                                                            |  |                    |        |  |                         |  |         |     |  |  |        |  

Nature of evidence supporting recognition of deferred tax assets

In assessing the recoverability of deferred tax assets, management determines, at each balance sheet date, whether it is more likely than not that a portion or
all of its deferred tax assets will be realized. This determination is based on quantitative and qualitative assessments by management and the weighing of all available evidence, both positive and negative. Such evidence includes the scheduled
reversal of deferred tax liabilities, projected future taxable income and the implementation of tax planning strategies.

As of December 31, 2016,
management analyzed all available evidence and determined it is more likely than not that substantially all of the Companys deferred tax assets in the US and Canadian operating entities will be realized. Accordingly, the Company continues to
recognize the majority of its deferred tax assets in the US and Canadian operating entities. With respect to the deferred tax assets at the Canadian corporate holding entity (the Entity), management determined it is appropriate to
maintain the same position for the year ended December 31, 2016 as taken for the year ended December 31, 2015 in that the majority of the Entitys deferred tax assets should continue to be derecognized as of December 31, 2016.
The Canadian deferred tax assets remain available to the Company in order to reduce its taxable income in future periods.



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##### Table of Contents

As of December 31, 2015, management analyzed all available evidence and determined it is more likely than
not that substantially all of the Companys deferred tax assets in the US will be realized and, accordingly, continues to recognize the majority of its US deferred tax assets. Management also determined it is more likely than not that
substantially all of the Companys deferred tax assets in the Canadian operating entity will be realized based on available evidence such as the cumulative positive financial results for the prior three years, consistent utilization of deferred
tax assets, consistent generation of taxable income, and positive financial projections.    Accordingly, the Company recognized the majority of its Canadian operating entitys deferred tax assets, including $3.8 million
that was previously derecognized. With respect to the Entity, management determined it appropriate to maintain the same position for the year ended December 31, 2015 as taken for the year ended December 31, 2014 in that the majority of the
Entitys deferred tax assets should continue to be derecognized as of December 31, 2015. The Canadian deferred tax assets remain available to the Company in order to reduce its taxable income in future periods.



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##### Table of Contents

The following tables outline the changes in the deferred tax assets and liabilities during the period:



|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|----------------------------------------------------------- |  | --------------------- | ------- | - | -------------------------------------------------- |  | ------- | ------------------------------- |  |  | ------------------------------------- | - |  | -------------------- | ------ | - | ----------------------- |  | ------ | - |  |  | ------- | -
|                                                            |  | BalanceJanuary 1,2015 |         |   | Recognized inearnings (withtranslationadjustments) |  |         | Recognized incontributedsurplus |  |  | Recognized inothercomprehensiveincome |   |  | Businessacquisitions |        |   | BalanceDecember 31,2015 | 
|                                                            |  | $                     |         |   | $                                                  |  |         | $                               |  |  | $                                     |   |  | $                    |        |   | $                       | 
|Deferred tax assets                                         |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|Tax credits, losses, carryforwards and other tax deductions |  |                       | 30,442  |   |                                                    |  | (10,123 | )                               |  |  |                                      |   |  |                      |       |   |                         |  |       |   |  |  | 20,319  |  
|Property, plant and equipment                               |  |                       | 17,969  |   |                                                    |  | (1,168  | )                               |  |  |                                      |   |  |                      |       |   |                         |  |       |   |  |  | 16,801  |  
|Pension and other post-retirement benefits                  |  |                       | 11,641  |   |                                                    |  | 334     |                                 |  |  |                                      |   |  |                      | (1,137 | ) |                         |  |       |   |  |  | 10,838  |  
|Stock-based payments                                        |  |                       | 9,560   |   |                                                    |  | 439     |                                 |  |  | (3,590                                | ) |  |                      |       |   |                         |  |       |   |  |  | 6,409   |  
|Accounts payable and accrued liabilities                    |  |                       | 3,937   |   |                                                    |  | 472     |                                 |  |  |                                      |   |  |                      |       |   |                         |  | 44     |   |  |  | 4,453   |  
|Goodwill and other intangibles                              |  |                       | 4,896   |   |                                                    |  | (1,432  | )                               |  |  |                                      |   |  |                      |       |   |                         |  |       |   |  |  | 3,464   |  
|Trade and other receivables                                 |  |                       |        |   |                                                    |  | 1,695   |                                 |  |  |                                      |   |  |                      |       |   |                         |  | 3      |   |  |  | 1,698   |  
|Inventories                                                 |  |                       | 1,501   |   |                                                    |  | 157     |                                 |  |  |                                      |   |  |                      |       |   |                         |  | 24     |   |  |  | 1,682   |  
|Other                                                       |  |                       | 898     |   |                                                    |  | (485    | )                               |  |  |                                      |   |  |                      | 166    |   |                         |  | 4      |   |  |  | 583     |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|                                                            |  |                       | 80,844  |   |                                                    |  | (10,111 | )                               |  |  | (3,590                                | ) |  |                      | (971   | ) |                         |  | 75     |   |  |  | 66,247  |  
|                                                            |  |                       |         |   |                                                    | 
|Deferred tax liabilities                                    |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|Property, plant and equipment                               |  |                       | (19,792 | ) |                                                    |  | 2,455   |                                 |  |  |                                      |   |  |                      |       |   |                         |  | (514   | ) |  |  | (17,851 | )
|Other                                                       |  |                       | (974    | ) |                                                    |  | 4       |                                 |  |  |                                      |   |  |                      |       |   |                         |  |       |   |  |  | (970    | )
|Goodwill and other intangibles                              |  |                       |        |   |                                                    |  | 645     |                                 |  |  |                                      |   |  |                      |       |   |                         |  | (2,763 | ) |  |  | (2,118  | )
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|                                                            |  |                       | (20,766 | ) |                                                    |  | 3,104   |                                 |  |  |                                      |   |  |                      |       |   |                         |  | (3,277 | ) |  |  | (20,939 | )
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|Deferred tax assets and liabilities                         |  |                       | 60,078  |   |                                                    |  | (7,007  | )                               |  |  | (3,590                                | ) |  |                      | (971   | ) |                         |  | (3,202 | ) |  |  | 45,308  |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|Impact due to foreign exchange rates                        |  |                       |         |   |                                                    |  | 4,209   |                                 |  |  |                                      |   |  |                      | 173    |   |                         |  |        |   |  |  |         |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  
|Total recognized                                            |  |                       |         |   |                                                    |  | (2,798  | )                               |  |  | (3,590                                | ) |  |                      | (798   | ) |                         |  |        |   |  |  |         |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |   |  |                      |        |   |                         |  |        |   |  |  |         |  



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##### Table of Contents

|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|----------------------------------------------------------- |  | --------------------- | ------- | - | -------------------------------------------------- |  | ------- | ------------------------------- |  |  | ------------------------------------- |  |  | -------------------- | ---- | - | ----------------------- |  | ------ | - |  |  | ------- | -
|                                                            |  | BalanceJanuary 1,2016 |         |   | Recognized inearnings (withtranslationadjustments) |  |         | Recognized incontributedsurplus |  |  | Recognized inothercomprehensiveincome |  |  | Businessacquisitions |      |   | BalanceDecember 31,2016 | 
|                                                            |  | $                     |         |   | $                                                  |  |         | $                               |  |  | $                                     |  |  | $                    |      |   | $                       | 
|Deferred tax assets                                         |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|Tax credits, losses, carryforwards and other tax deductions |  |                       | 20,319  |   |                                                    |  | (4,630  | )                               |  |  |                                      |  |  |                      |     |   |                         |  |       |   |  |  | 15,689  |  
|Property, plant and equipment                               |  |                       | 16,801  |   |                                                    |  | 1,324   |                                 |  |  |                                      |  |  |                      |     |   |                         |  |       |   |  |  | 18,125  |  
|Pension and other post-retirement benefits                  |  |                       | 10,838  |   |                                                    |  | 707     |                                 |  |  |                                      |  |  |                      | (78  | ) |                         |  |       |   |  |  | 11,467  |  
|Stock-based payments                                        |  |                       | 6,409   |   |                                                    |  | 731     |                                 |  |  | 1,609                                 |  |  |                      |     |   |                         |  |       |   |  |  | 8,749   |  
|Accounts payable and accrued liabilities                    |  |                       | 4,453   |   |                                                    |  | 2,420   |                                 |  |  |                                      |  |  |                      |     |   |                         |  | 20     |   |  |  | 6,893   |  
|Goodwill and other intangibles                              |  |                       | 3,464   |   |                                                    |  | 194     |                                 |  |  |                                      |  |  |                      |     |   |                         |  |       |   |  |  | 3,658   |  
|Trade and other receivables                                 |  |                       | 1,698   |   |                                                    |  | (1,345  | )                               |  |  |                                      |  |  |                      |     |   |                         |  |       |   |  |  | 353     |  
|Inventories                                                 |  |                       | 1,682   |   |                                                    |  | 1,189   |                                 |  |  |                                      |  |  |                      |     |   |                         |  |       |   |  |  | 2,871   |  
|Other                                                       |  |                       | 583     |   |                                                    |  | 39      |                                 |  |  |                                      |  |  |                      | (83  | ) |                         |  |       |   |  |  | 539     |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|                                                            |  |                       | 66,247  |   |                                                    |  | 629     |                                 |  |  | 1,609                                 |  |  |                      | (161 | ) |                         |  | 20     |   |  |  | 68,344  |  
|Deferred tax liabilities                                    |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|Property, plant and equipment                               |  |                       | (17,851 | ) |                                                    |  | (10,791 | )                               |  |  |                                      |  |  |                      |     |   |                         |  | (1,436 | ) |  |  | (30,078 | )
|Other                                                       |  |                       | (970    | ) |                                                    |  | (132    | )                               |  |  |                                      |  |  |                      |     |   |                         |  |       |   |  |  | (1,102  | )
|Goodwill and other intangibles                              |  |                       | (2,118  | ) |                                                    |  | 551     |                                 |  |  |                                      |  |  |                      |     |   |                         |  | (8,318 | ) |  |  | (9,885  | )
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|                                                            |  |                       | (20,939 | ) |                                                    |  | (10,372 | )                               |  |  |                                      |  |  |                      |     |   |                         |  | (9,754 | ) |  |  | (41,065 | )
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|Deferred tax assets and liabilities                         |  |                       | 45,308  |   |                                                    |  | (9,743  | )                               |  |  | 1,609                                 |  |  |                      | (161 | ) |                         |  | (9,734 | ) |  |  | 27,279  |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|Impact due to foreign exchange rates                        |  |                       |         |   |                                                    |  | (1,069  | )                               |  |  |                                      |  |  |                      | 12   |   |                         |  |        |   |  |  |         |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  
|Total recognized                                            |  |                       |         |   |                                                    |  | (10,812 | )                               |  |  | 1,609                                 |  |  |                      | (149 | ) |                         |  |        |   |  |  |         |  
|                                                            |  |                       |         |   |                                                    |  |         |                                 |  |  |                                       |  |  |                      |      |   |                         |  |        |   |  |  |         |  



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##### Table of Contents

Deductible temporary differences and unused tax losses for which no deferred tax asset is recognized in the
consolidated balance sheets are as follows:



|                                                   |  |                  |        |  |                  |  |        | 
|-------------------------------------------------- |  | ---------------- | ------ |  | ---------------- |  | ------ | 
|                                                   |  | December 31,2016 |        |  | December 31,2015 | 
|                                                   |  | $                |        |  | $                | 
|Tax losses, carryforwards and other tax deductions |  |                  | 22,015 |  |                  |  | 22,002 | 
|                                                   |  |                  |        |  |                  |  |        | 

The following table presents the amounts and expiration dates relating to unused tax credits in Canada for which no deferred
tax asset is recognized in the consolidated balance sheets as of December 31:



|                               |  |      |       |  |      |  |       | 
|------------------------------ |  | ---- | ----- |  | ---- |  | ----- | 
|                               |  | 2016 |       |  | 2015 | 
|                               |  | $    |       |  | $    | 
|2018                           |  |      | 633   |  |      |  | 612   | 
|2019                           |  |      | 1,191 |  |      |  | 1,152 | 
|2020                           |  |      | 526   |  |      |  | 508   | 
|2021                           |  |      | 199   |  |      |  | 192   | 
|2022                           |  |      | 453   |  |      |  | 438   | 
|2023                           |  |      | 224   |  |      |  | 217   | 
|2024                           |  |      | 211   |  |      |  | 204   | 
|2025                           |  |      | 357   |  |      |  | 345   | 
|2026                           |  |      | 273   |  |      |  | 264   | 
|2027                           |  |      | 249   |  |      |  | 241   | 
|2028                           |  |      | 290   |  |      |  | 280   | 
|2029                           |  |      | 231   |  |      |  | 223   | 
|2030                           |  |      | 210   |  |      |  | 203   | 
|2031                           |  |      | 308   |  |      |  | 297   | 
|2032                           |  |      | 185   |  |      |  | 179   | 
|2033                           |  |      | 226   |  |      |  | 219   | 
|2034                           |  |      | 200   |  |      |  | 194   | 
|2035                           |  |      | 533   |  |      |  | 180   | 
|2036                           |  |      | 257   |  |      |  |      | 
|                               |  |      |       |  |      |  |       | 
|Total tax credits derecognized |  |      | 6,756 |  |      |  | 5,948 | 
|                               |  |      |       |  |      |  |       | 

The following table presents the year of expiration of the Companys operating losses carried forward in Canada as of
December 31, 2016:



|     |  |                   |       |  |                      |  |       |         |  |  |            |  |  |  |       | 
|---- |  | ----------------- | ----- |  | -------------------- |  | ----- | ------- |  |  | ---------- |  |  |  | ----- | 
|     |  | DTA is recognized |       |  | DTA is notrecognized | 
|     |  | Federal           |       |  | Provincial           |  |       | Federal |  |  | Provincial | 
|     |  | $                 |       |  | $                    |  |       | $       |  |  | $          | 
|2029 |  |                   |      |  |                      |  |      |         |  |  | 880        |  |  |  | 880   | 
|2030 |  |                   |      |  |                      |  |      |         |  |  | 2,423      |  |  |  | 2,423 | 
|2031 |  |                   | 2,792 |  |                      |  | 2,791 |         |  |  | 1,527      |  |  |  | 1,527 | 
|2032 |  |                   | 2,932 |  |                      |  | 2,932 |         |  |  |           |  |  |  |      | 
|     |  |                   |       |  |                      |  |       |         |  |  |            |  |  |  |       | 
|     |  |                   | 5,724 |  |                      |  | 5,723 |         |  |  | 4,830      |  |  |  | 4,830 | 
|     |  |                   |       |  |                      |  |       |         |  |  |            |  |  |  |       | 

In addition, the Company has (i) state losses of $118.6 million (with expiration dates ranging from 2018 to 2032)
for which a tax benefit of $3.3 million has been recognized; (ii) state losses of $77.1 million (with expiration dates ranging from 2017 to 2028) for which a tax benefit of $2.7 million has not been recognized; and (iii)
$15.0 million of capital loss carryforwards with indefinite lives available to offset future capital gains in Canada for which no tax benefit has been recognized.



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##### Table of Contents

6 -EARNINGS PER SHARE

The weighted average number of common shares outstanding is as follows for the years ended:



|                        |  |                  |            |  |                  |  |            |                  |  |  |            | 
|----------------------- |  | ---------------- | ---------- |  | ---------------- |  | ---------- | ---------------- |  |  | ---------- | 
|                        |  | December 31,2016 |            |  | December 31,2015 |  |            | December 31,2014 | 
|Basic                   |  |                  | 58,727,751 |  |                  |  | 59,690,968 |                  |  |  | 60,718,776 | 
|Effect of stock options |  |                  | 473,446    |  |                  |  | 808,928    |                  |  |  | 1,214,925  | 
|Effect of PSUs          |  |                  | 1,168,030  |  |                  |  | 610,737    |                  |  |  | 127,222    | 
|                        |  |                  |            |  |                  |  |            |                  |  |  |            | 
|Diluted                 |  |                  | 60,369,227 |  |                  |  | 61,110,633 |                  |  |  | 62,060,923 | 
|                        |  |                  |            |  |                  |  |            |                  |  |  |            | 

Additional items included or excluded in the diluted earnings per share calculations for the years ended:



|                                                                                                  |  |                  |         |  |                  |  |         |                  |  |  |         | 
|------------------------------------------------------------------------------------------------- |  | ---------------- | ------- |  | ---------------- |  | ------- | ---------------- |  |  | ------- | 
|                                                                                                  |  | December 31,2016 |         |  | December 31,2015 |  |         | December 31,2014 | 
|Stock options that were anti-dilutive and not included in diluted earnings per share
calculations |  |                  |        |  |                  |  |        |                  |  |  | 32,500  | 
|The effect of PSUs included in diluted earnings per share calculations                            |  |                  | 892,077 |  |                  |  | 498,040 |                  |  |  | 152,500 | 

7 -INVENTORIES

Inventory is composed of the following for the years ended:



|                |  |                  |         |  |                  |  |         | 
|--------------- |  | ---------------- | ------- |  | ---------------- |  | ------- | 
|                |  | December 31,2016 |         |  | December 31,2015 | 
|                |  | $                |         |  | $                | 
|Raw materials   |  |                  | 28,099  |  |                  |  | 27,570  | 
|Work in process |  |                  | 18,635  |  |                  |  | 18,640  | 
|Finished goods  |  |                  | 56,736  |  |                  |  | 54,341  | 
|                |  |                  |         |  |                  |  |         | 
|                |  |                  | 103,470 |  |                  |  | 100,551 | 
|                |  |                  |         |  |                  |  |         | 

The Company recorded impairments of inventories to net realizable value in the Companys consolidated earnings during the
years ended December 31, 2016 and 2015 as follows:



|                                                                                     |  |      |       |  |      |  |       | 
|------------------------------------------------------------------------------------ |  | ---- | ----- |  | ---- |  | ----- | 
|                                                                                     |  | 2016 |       |  | 2015 | 
|                                                                                     |  | $    |       |  | $    | 
|Recorded in manufacturing facility closures, restructuring and other related charges |  |      | 1,420 |  |      |  | 3,724 | 
|Recorded in cost of sales                                                            |  |      | 2,019 |  |      |  | 750   | 
|                                                                                     |  |      |       |  |      |  |       | 
|                                                                                     |  |      | 3,439 |  |      |  | 4,474 | 
|                                                                                     |  |      |       |  |      |  |       | 

There were no reversals of impairments of inventories to net realizable value in the Companys consolidated earnings
during the years ended December 31, 2016 and 2015. Refer to Note 12 for information regarding impairments of inventories.



|                                                                                  |  |                  |         |  |                  |  |         |                  |  |  |         | 
|--------------------------------------------------------------------------------- |  | ---------------- | ------- |  | ---------------- |  | ------- | ---------------- |  |  | ------- | 
|                                                                                  |  | December 31,2016 |         |  | December 31,2015 |  |         | December 31,2014 | 
|                                                                                  |  | $                |         |  | $                |  |         | $                | 
|The amount of inventories recognized in earnings as an expense during the period: |  |                  | 575,473 |  |                  |  | 569,374 |                  |  |  | 603,533 | 
|                                                                                  |  |                  |         |  |                  |  |         |                  |  |  |         | 



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##### Table of Contents

8 -OTHER CURRENT ASSETS

Other current assets are comprised of the following for the years ended:



|                                             |  |                  |        |  |                  |  |       | 
|-------------------------------------------- |  | ---------------- | ------ |  | ---------------- |  | ----- | 
|                                             |  | December 31,2016 |        |  | December 31,2015 | 
|                                             |  | $                |        |  | $                | 
|Income taxes receivable and prepaid          |  |                  | 2,647  |  |                  |  | 1,374 | 
|Sales and other taxes receivable and credits |  |                  | 1,257  |  |                  |  | 1,283 | 
|Prepaid expenses                             |  |                  | 5,260  |  |                  |  | 4,449 | 
|Supplier rebates receivable                  |  |                  | 1,908  |  |                  |  | 727   | 
|Other                                        |  |                  | 249    |  |                  |  | 866   | 
|                                             |  |                  |        |  |                  |  |       | 
|                                             |  |                  | 11,321 |  |                  |  | 8,699 | 
|                                             |  |                  |        |  |                  |  |       | 



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##### Table of Contents

9 -PROPERTY, PLANT AND EQUIPMENT

The following tables outline the changes to property, plant and equipment during the period:



|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |        |   |                         |  |       |       |  |  |         |   |  |  |         |  
|------------------------------------------- |  | ---- | ----- | - | --------- |  | ------ | ---------------------- |  |  | ----------------------------- | - |  | ----------------------------------- | ------ | - | ----------------------- |  | ----- | ----- |  |  | ------- | - |  |  | ------- | -
|                                            |  | Land |       |   | Buildings |  |        | Manufacturingequipment |  |  | Computerequipmentand software |   |  | Furniture,office equipmentand other |        |   | Construction inprogress |  |       | Total | 
|                                            |  | $    |       |   | $         |  |        | $                      |  |  | $                             |   |  | $                                   |        |   | $                       |  |       | $     | 
|Gross carrying amount                       |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |        |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2014             |  |      | 3,464 |   |           |  | 86,969 |                        |  |  | 499,853                       |   |  |                                     | 59,739 |   |                         |  | 2,565 |       |  |  | 52,231  |   |  |  | 704,821 |  
|Additions  separately acquired             |  |      |      |   |           |  |       |                        |  |  |                              |   |  |                                     |       |   |                         |  |      |       |  |  | 33,600  |   |  |  | 33,600  |  
|Additions through business acquisitions     |  |      |      |   |           |  | 1,130  |                        |  |  | 4,456                         |   |  |                                     | 46     |   |                         |  | 87    |       |  |  | 13      |   |  |  | 5,732   |  
|Assets placed into service                  |  |      |      |   |           |  | 927    |                        |  |  | 38,334                        |   |  |                                     | 5,552  |   |                         |  | 29    |       |  |  | (44,842 | ) |  |  |        |  
|Disposals                                   |  |      |      |   |           |  | (1,561 | )                      |  |  | (3,469                        | ) |  |                                     | (61    | ) |                         |  | (101  | )     |  |  |        |   |  |  | (5,192  | )
|Foreign exchange and other                  |  |      | (101  | ) |           |  | (2,689 | )                      |  |  | (16,027                       | ) |  |                                     | (1,249 | ) |                         |  | 71    |       |  |  | (262    | ) |  |  | (20,257 | )
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |        |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2015             |  |      | 3,363 |   |           |  | 84,776 |                        |  |  | 523,147                       |   |  |                                     | 64,027 |   |                         |  | 2,651 |       |  |  | 40,740  |   |  |  | 718,704 |  
|Accumulated depreciation and impairments    |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |        |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2014             |  |      | 695   |   |           |  | 56,553 |                        |  |  | 402,080                       |   |  |                                     | 55,245 |   |                         |  | 2,102 |       |  |  |        |   |  |  | 516,675 |  
|Depreciation                                |  |      |      |   |           |  | 4,159  |                        |  |  | 23,271                        |   |  |                                     | 2,308  |   |                         |  | 119   |       |  |  |        |   |  |  | 29,857  |  
|Impairments                                 |  |      |      |   |           |  | 578    |                        |  |  | 1,197                         |   |  |                                     |       |   |                         |  |      |       |  |  |        |   |  |  | 1,775   |  
|Impairment reversals                        |  |      | (86   | ) |           |  | (807   | )                      |  |  | (5,690                        | ) |  |                                     | (1     | ) |                         |  |      |       |  |  |        |   |  |  | (6,584  | )
|Disposals                                   |  |      |      |   |           |  | (1,226 | )                      |  |  | (3,296                        | ) |  |                                     | (61    | ) |                         |  | (65   | )     |  |  |        |   |  |  | (4,648  | )
|Foreign exchange and other                  |  |      |      |   |           |  | (2,111 | )                      |  |  | (13,010                       | ) |  |                                     | (1,206 | ) |                         |  | (129  | )     |  |  |        |   |  |  | (16,456 | )
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |        |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2015             |  |      | 609   |   |           |  | 57,146 |                        |  |  | 404,552                       |   |  |                                     | 56,285 |   |                         |  | 2,027 |       |  |  |        |   |  |  | 520,619 |  
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |        |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Net carrying amount as of December 31, 2015 |  |      | 2,754 |   |           |  | 27,630 |                        |  |  | 118,595                       |   |  |                                     | 7,742  |   |                         |  | 624   |       |  |  | 40,740  |   |  |  | 198,085 |  
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |        |   |                         |  |       |       |  |  |         |   |  |  |         |  



|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |         |   |                         |  |       |       |  |  |         |   |  |  |         |  
|------------------------------------------- |  | ---- | ----- | - | --------- |  | ------ | ---------------------- |  |  | ----------------------------- | - |  | ----------------------------------- | ------- | - | ----------------------- |  | ----- | ----- |  |  | ------- | - |  |  | ------- | -
|                                            |  | Land |       |   | Buildings |  |        | Manufacturingequipment |  |  | Computerequipmentand software |   |  | Furniture,office equipmentand other |         |   | Construction inprogress |  |       | Total | 
|                                            |  | $    |       |   | $         |  |        | $                      |  |  | $                             |   |  | $                                   |         |   | $                       |  |       | $     | 
|Gross carrying amount                       |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |         |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2015             |  |      | 3,363 |   |           |  | 84,776 |                        |  |  | 523,147                       |   |  |                                     | 64,027  |   |                         |  | 2,651 |       |  |  | 40,740  |   |  |  | 718,704 |  
|Additions  separately acquired             |  |      |      |   |           |  |       |                        |  |  |                              |   |  |                                     |        |   |                         |  |      |       |  |  | 58,679  |   |  |  | 58,679  |  
|Additions through business acquisitions     |  |      | 2,583 |   |           |  | 1,908  |                        |  |  | 5,083                         |   |  |                                     | 21      |   |                         |  | 46    |       |  |  | 9       |   |  |  | 9,650   |  
|Assets placed into service                  |  |      | 250   |   |           |  | 6,570  |                        |  |  | 47,603                        |   |  |                                     | 815     |   |                         |  | 122   |       |  |  | (55,360 | ) |  |  |        |  
|Disposals                                   |  |      |      |   |           |  | (534   | )                      |  |  | (20,124                       | ) |  |                                     | (23,439 | ) |                         |  | (352  | )     |  |  |        |   |  |  | (44,449 | )
|Foreign exchange and other                  |  |      | (66   | ) |           |  | 225    |                        |  |  | 1,608                         |   |  |                                     | 219     |   |                         |  |      |       |  |  | (75     | ) |  |  | 1,911   |  
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |         |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2016             |  |      | 6,130 |   |           |  | 92,945 |                        |  |  | 557,317                       |   |  |                                     | 41,643  |   |                         |  | 2,467 |       |  |  | 43,993  |   |  |  | 744,495 |  
|Accumulated depreciation and impairments    |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |         |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2015             |  |      | 609   |   |           |  | 57,146 |                        |  |  | 404,552                       |   |  |                                     | 56,285  |   |                         |  | 2,027 |       |  |  |        |   |  |  | 520,619 |  
|Depreciation                                |  |      |      |   |           |  | 4,209  |                        |  |  | 22,802                        |   |  |                                     | 2,235   |   |                         |  | 156   |       |  |  |        |   |  |  | 29,402  |  
|Impairments                                 |  |      |      |   |           |  |       |                        |  |  | 4,024                         |   |  |                                     | 133     |   |                         |  | 32    |       |  |  | 86      |   |  |  | 4,275   |  
|Impairment reversals                        |  |      |      |   |           |  |       |                        |  |  | (1,031                        | ) |  |                                     |        |   |                         |  |      |       |  |  |        |   |  |  | (1,031  | )
|Disposals                                   |  |      |      |   |           |  | (529   | )                      |  |  | (19,927                       | ) |  |                                     | (23,408 | ) |                         |  | (345  | )     |  |  |        |   |  |  | (44,209 | )
|Foreign exchange and other                  |  |      |      |   |           |  | 246    |                        |  |  | 1,504                         |   |  |                                     | 215     |   |                         |  | (4    | )     |  |  |        |   |  |  | 1,961   |  
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |         |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Balance as of December 31, 2016             |  |      | 609   |   |           |  | 61,072 |                        |  |  | 411,924                       |   |  |                                     | 35,460  |   |                         |  | 1,866 |       |  |  | 86      |   |  |  | 511,017 |  
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |         |   |                         |  |       |       |  |  |         |   |  |  |         |  
|Net carrying amount as of December 31, 2016 |  |      | 5,521 |   |           |  | 31,873 |                        |  |  | 145,393                       |   |  |                                     | 6,183   |   |                         |  | 601   |       |  |  | 43,907  |   |  |  | 233,478 |  
|                                            |  |      |       |   |           |  |        |                        |  |  |                               |   |  |                                     |         |   |                         |  |       |       |  |  |         |   |  |  |         |  



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##### Table of Contents

During the year ended December 31, 2016 the loss on disposals amounted to $0.1 million
($0.8 million gain on disposals in 2015 and $0.1 million loss on disposals in 2014).

Included in property, plant and equipment are assets under
finance leases with the following carrying amounts as follows for the years ended:



|                                |  |                  |        |  |                  |  |        | 
|------------------------------- |  | ---------------- | ------ |  | ---------------- |  | ------ | 
|                                |  | December 31,2016 |        |  | December 31,2015 | 
|                                |  | $                |        |  | $                | 
|Buildings                       |  |                  | 2,429  |  |                  |  | 2,898  | 
|Manufacturing equipment         |  |                  | 20,995 |  |                  |  | 22,623 | 
|Computer equipment and software |  |                  |       |  |                  |  | 42     | 
|                                |  |                  |        |  |                  |  |        | 
|                                |  |                  | 23,424 |  |                  |  | 25,563 | 
|                                |  |                  |        |  |                  |  |        | 

Supplemental information regarding property, plant and equipment is as follows for the years ended:



|                                                      |  |                  |        |   |                  |   |        |  
|----------------------------------------------------- |  | ---------------- | ------ | - | ---------------- | - | ------ | -
|                                                      |  | December 31,2016 |        |   | December 31,2015 |  
|Interest capitalized to property, plant and equipment |  | $                | 817    |   |                  | $ | 657    |  
|Weighted average capitalization rates                 |  |                  | 2.64   | % |                  |   | 2.12   | %
|Commitments to purchase machinery and equipment       |  | $                | 32,375 |   |                  | $ | 20,877 |  

10 -OTHER ASSETS

Other assets are comprised of the following for the years ended:



|                                                     |  |                  |       |  |                  |  |       | 
|---------------------------------------------------- |  | ---------------- | ----- |  | ---------------- |  | ----- | 
|                                                     |  | December 31,2016 |       |  | December 31,2015 | 
|                                                     |  | $                |       |  | $                | 
|Cash surrender value of officers life insurance     |  |                  | 339   |  |                  |  | 316   | 
|Prepaid software licensing                           |  |                  | 1,172 |  |                  |  | 1,232 | 
|Deposits                                             |  |                  | 214   |  |                  |  | 339   | 
|Corporate owned life insurance held in grantor trust |  |                  | 1,629 |  |                  |  | 1,265 | 
|Other                                                |  |                  | 26    |  |                  |  | 26    | 
|                                                     |  |                  |       |  |                  |  |       | 
|                                                     |  |                  | 3,380 |  |                  |  | 3,178 | 
|                                                     |  |                  |       |  |                  |  |       | 



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##### Table of Contents

11 -INTANGIBLE ASSETS

The follow tables outline the changes in intangible assets during the period:



|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|------------------------------------------- |  | ------------------ | ----- | - | ----------------- |  | ----- | ----------------- |  |  | ------------- | - |  | -------- | ------ | - | --------------------- |  | ----- | --------------------- |  |  | ----- | - |  |  | ----- | - |  |  | ------ | -
|                                            |  | Distributionrights |       |   | Customercontracts |  |       | Licenseagreements |  |  | CustomerLists |   |  | Software |        |   | Patents/Trademarks(1) |  |       | Non-competeagreements |  |  | Total |  
|                                            |  | $                  |       |   | $                 |  |       | $                 |  |  | $             |   |  | $        |        |   | $                     |  |       | $                     |  |  | $     |  
|Gross carrying amount                       |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2014             |  |                    | 3,122 |   |                   |  | 1,200 |                   |  |  | 1,151         |   |  |          | 811    |   |                       |  | 1,526 |                       |  |  |      |   |  |  |      |   |  |  | 7,810  |  
|Additions  separately acquired             |  |                    |      |   |                   |  |      |                   |  |  |              |   |  |          |       |   |                       |  | 174   |                       |  |  |      |   |  |  |      |   |  |  | 174    |  
|Additions through business acquisitions     |  |                    |      |   |                   |  |      |                   |  |  |              |   |  |          | 9,438  |   |                       |  |      |                       |  |  | 2,215 |   |  |  | 198   |   |  |  | 11,851 |  
|Disposals                                   |  |                    |      |   |                   |  |      |                   |  |  | (849          | ) |  |          |       |   |                       |  |      |                       |  |  |      |   |  |  |      |   |  |  | (849   | )
|Net foreign exchange differences            |  |                    | (515  | ) |                   |  | (199  | )                 |  |  |              |   |  |          |       |   |                       |  |      |                       |  |  |      |   |  |  |      |   |  |  | (714   | )
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2015             |  |                    | 2,607 |   |                   |  | 1,001 |                   |  |  | 302           |   |  |          | 10,249 |   |                       |  | 1,700 |                       |  |  | 2,215 |   |  |  | 198   |   |  |  | 18,272 |  
|Accumulated amortization and impairments    |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2014             |  |                    | 3,033 |   |                   |  | 1,177 |                   |  |  | 910           |   |  |          | 554    |   |                       |  | 555   |                       |  |  |      |   |  |  |      |   |  |  | 6,229  |  
|Amortization                                |  |                    | 28    |   |                   |  | 20    |                   |  |  | 143           |   |  |          | 553    |   |                       |  | 210   |                       |  |  | 19    |   |  |  | 50    |   |  |  | 1,023  |  
|Disposals                                   |  |                    |      |   |                   |  |      |                   |  |  | (849          | ) |  |          |       |   |                       |  |      |                       |  |  |      |   |  |  |      |   |  |  | (849   | )
|Net foreign exchange differences            |  |                    | (500  | ) |                   |  | (199  | )                 |  |  |              |   |  |          |       |   |                       |  |      |                       |  |  |      |   |  |  |      |   |  |  | (699   | )
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2015             |  |                    | 2,561 |   |                   |  | 998   |                   |  |  | 204           |   |  |          | 1,107  |   |                       |  | 765   |                       |  |  | 19    |   |  |  | 50    |   |  |  | 5,704  |  
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Net carrying amount as of December 31, 2015 |  |                    | 46    |   |                   |  | 3     |                   |  |  | 98            |   |  |          | 9,142  |   |                       |  | 935   |                       |  |  | 2,196 |   |  |  | 148   |   |  |  | 12,568 |  
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|                                            |  |                    |       |   |                   |  |       |                  
|                                            |  | Distributionrights |       |   | Customercontracts |  |       | Licenseagreements |  |  | CustomerLists |   |  | Software |        |   | Patents/Trademarks(1) |  |       | Non-competeagreements |  |  | Total |  
|                                            |  | $                  |       |   | $                 |  |       | $                 |  |  | $             |   |  | $        |        |   | $                     |  |       | $                     |  |  | $     |  
|Gross carrying amount                       |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2015             |  |                    | 2,607 |   |                   |  | 1,001 |                   |  |  | 302           |   |  |          | 10,249 |   |                       |  | 1,700 |                       |  |  | 2,215 |   |  |  | 198   |   |  |  | 18,272 |  
|Additions  separately acquired             |  |                    |      |   |                   |  |      |                   |  |  |              |   |  |          |       |   |                       |  | 83    |                       |  |  |      |   |  |  |      |   |  |  | 83     |  
|Additions through business acquisitions     |  |                    |       |   |                   |  |      |                   |  |  |              |   |  |          | 16,213 |   |                       |  |      |                       |  |  |      |   |  |  | 7,822 |   |  |  | 24,035 |  
|Net foreign exchange differences            |  |                    | 90    |   |                   |  | 36    |                   |  |  |              |   |  |          | (256   | ) |                       |  |      |                       |  |  | 1     |   |  |  | (124  | ) |  |  | (253   | )
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2016             |  |                    | 2,697 |   |                   |  | 1,037 |                   |  |  | 302           |   |  |          | 26,206 |   |                       |  | 1,783 |                       |  |  | 2,216 |   |  |  | 7,896 |   |  |  | 42,137 |  
|Accumulated amortization and impairments    |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2015             |  |                    | 2,561 |   |                   |  | 998   |                   |  |  | 204           |   |  |          | 1,107  |   |                       |  | 765   |                       |  |  | 19    |   |  |  | 50    |   |  |  | 5,704  |  
|Amortization                                |  |                    | 29    |   |                   |  | 4     |                   |  |  | 6             |   |  |          | 1,189  |   |                       |  | 251   |                       |  |  | 120   |   |  |  | 291   |   |  |  | 1,890  |  
|Impairments                                 |  |                    |      |   |                   |  |      |                   |  |  |              |   |  |          |       |   |                       |  |      |                       |  |  | 379   |   |  |  |      |   |  |  | 379    |  
|Net foreign exchange differences            |  |                    | 88    |   |                   |  | 35    |                   |  |  |              |   |  |          |       |   |                       |  |      |                       |  |  | (9    | ) |  |  |      |   |  |  | 114    |  
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Balance as of December 31, 2016             |  |                    | 2,678 |   |                   |  | 1,037 |                   |  |  | 210           |   |  |          | 2,296  |   |                       |  | 1,016 |                       |  |  | 509   |   |  |  | 341   |   |  |  | 8,087  |  
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  
|Net carrying amount as of December 31, 2016 |  |                    | 19    |   |                   |  |      |                   |  |  | 92            |   |  |          | 23,910 |   |                       |  | 767   |                       |  |  | 1,707 |   |  |  | 7,555 |   |  |  | 34,050 |  
|                                            |  |                    |       |   |                   |  |       |                   |  |  |               |   |  |          |        |   |                       |  |       |                       |  |  |       |   |  |  |       |   |  |  |        |  



|(1) | Includes a trademark of $1.7 million not subject to amortization.
|--- | -----------------------------------------------------------------



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##### Table of Contents

12 -IMPAIRMENT OF ASSETS

CGU Determination and Indicators of Impairment

In
updating its determination of CGUs and applying any related indicators of impairment, the Company took into consideration the manufacturing facility closures and other related activities that have taken place in the course of the year; the expected
costs, timeline, and future benefits expected from major capital expenditure projects; the impact of acquisitions; as well as changes in the interdependencies of cash flows among the Companys manufacturing sites. As a result of this analysis,
the Company determined there was a change in its CGUs in 2016, and that the Tapes and Films CGU is now comprised of the Companys tape and film manufacturing locations in the United States, including Better Packages and TaraTape, as well as
Powerband, the recently acquired manufacturing site located in Daman, India (see Note 17 for further discussion of acquisitions). The change occurred due to integration activities that occurred between Better Packages and TaraTape, and the
Companys legacy locations in the United States, as well as immediate synergies and cash flow interdependencies created by the Powerband Acquisition and the Companys existing operations within the United States. The Companys other
CGUs, including Engineered Coated Products (which currently is comprised of its Canadian operations that produce these products) and Fibope (the Companys operating site in Portugal) were not affected by these changes.

There were no indicators of impairment for the CGUs. Due to the changes in the asset base and expected future cash flows of the newly defined Tapes and Films
CGU, however, the Company conducted an impairment test, as discussed further below, which resulted in no impairment being recognized. Unrelated to the impairment tests performed at the CGU level, there were impairments of certain individual assets
as disclosed in the impairments table below which primarily relate to manufacturing facility closures, restructuring and other related charges. The Company also considers indicators for the reversal of prior impairment charges recorded, which is
based on the recent and projected results of CGUs and specific asset groups that were previously impaired. For the year ended December 31, 2016, this analysis resulted in no impairment reversals.

Impairment Testing

All of the Companys carrying
amount of goodwill, intangible assets with indefinite useful lives and software not yet available for use as of December 31, 2016 relate to the Tapes and Films CGU. The Company performed the required annual impairment test for this CGU in the
fourth quarter of 2016 as discussed above. The impairment test for the CGU was determined based on value in use. The key assumptions used in each discounted cash flow projection, managements approach to determine the value assigned to each key
assumption, and other information as required for the CGU is outlined in the table below. Reasonably possible changes in the key assumptions below would not be expected to cause the carrying amount of the CGU to exceed its recoverable amount, in
which case an impairment would otherwise be recognized.

Details of the impairment tests performed are outlined below:



|                                                                                                |  |  |                              | 
|----------------------------------------------------------------------------------------------- |  |  | ---------------------------- | 
|Carrying amount allocated to the CGU                                                            |  |  |                              | 
|Goodwill                                                                                        |  |  | $30,841                      | 
|Intangible assets with indefinite useful lives                                                  |  |  | $1,700                       | 
|Results of test performed as of December 31, 2016:                                              |  |  |                              | 
|Recoverable amount                                                                              |  |  | $848,632                     | 
|Annual revenue growth rates (1)                                                                 |  |  | 8.6% in 2017,2.5% thereafter | 
|Discount rate(2)                                                                                |  |  | 10.0%                        | 
|Cash flows beyond the five-year period have been extrapolated using a steady growth rate of (3) |  |  | 2.5%                         | 
|Income tax rate (4)                                                                             |  |  | 38.0%                        | 



F-44



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##### Table of Contents

Sensitivity analysis performed using reasonably possible changes in key assumptions above:



|                                                                                            |  |  |                            | 
|------------------------------------------------------------------------------------------- |  |  | -------------------------- | 
|Revenue growth rates                                                                        |  |  | 8.6% in 2017, 0%thereafter | 
|Discount rate                                                                               |  |  | 12.0%                      | 
|Cash flows beyond the five-year period have been extrapolated using a steady growth rate
of |  |  | 1.0%                       | 
|Income tax rate                                                                             |  |  | 43.0%                      | 

There was no impairment resulting from changing the individual assumptions above.

Revenue and other future assumptions used in this model were prepared in accordance with IAS 36  Impairment of Assets and, as such, do not include the
benefit from obtaining or the incremental costs to obtain growth initiatives or cost reduction programs that the Company may be planning but has not yet undertaken within its current asset base.



|(1) | Annual revenue growth rates are for each year in the five-year period beginning in 2017, and are based on projections presented to management and the Board of
Directors which assume that the Companys revenue will grow consistent with United States gross domestic product projections, after taking into account a full year of benefit from the Powerband Acquisition in 2017 which causes the larger
increase for that year. The revenue growth rates for the period are consistent with recent history of sales volumes within the CGU as well as the Companys expectations for its sales to at least match gross domestic product growth.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(2) | The discount rate used is the estimated weighted average cost of capital for the CGU.
|--- | -------------------------------------------------------------------------------------



|(3) | Cash flows beyond the five-year period have been extrapolated using a per annum growth rate which is at or below the projected long-term average growth rate for the
CGUs business.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(4) | The income tax rate represents an estimated statutory federal and state tax rate.
|--- | ---------------------------------------------------------------------------------



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##### Table of Contents

Impairments

Impairments (reversals of impairments) recognized during the years ended December 31, 2016 and 2015 are as follows:



|                                                                         |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|------------------------------------------------------------------------ |  | -------------------- | ----- |  | ------------------ |  | ------ | -------------------- |  |  | ------------------ |  |  |  | ------ | -
|                                                                         |  | 2016                 |       |  | 2015               | 
|                                                                         |  | Impairmentrecognized |       |  | Impairmentreversed |  |        | Impairmentrecognized |  |  | Impairmentreversed | 
|                                                                         |  | $                    |       |  | $                  |  |        | $                    |  |  | $                  | 
|Classes of assets impaired                                               |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|Manufacturing facility closures, restructuring and other related charges |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|Inventories                                                              |  |                      | 1,420 |  |                    |  |       |                      |  |  | 3,724              |  |  |  |       |  
|Parts and supplies                                                       |  |                      |      |  |                    |  |       |                      |  |  | 15                 |  |  |  | (60    | )
|Property, plant and equipment                                            |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|Buildings                                                                |  |                      |      |  |                    |  |       |                      |  |  | 578                |  |  |  |       |  
|Manufacturing equipment                                                  |  |                      | 4,017 |  |                    |  | (1,031 | )                    |  |  | 1,156              |  |  |  | (747   | )
|Furniture, office equipment and other                                    |  |                      | 32    |  |                    |  |       |                      |  |  |                   |  |  |  |       |  
|Intangibles                                                              |  |                      | 379   |  |                    |  |       |                      |  |  |                   |  |  |  |       |  
|                                                                         |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|                                                                         |  |                      | 5,848 |  |                    |  | (1,031 | )                    |  |  | 5,473              |  |  |  | (807   | )
|                                                                         |  |                      |       | 
|Cost of sales                                                            |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|Inventories                                                              |  |                      | 2,019 |  |                    |  |       |                      |  |  | 750                |  |  |  |       |  
|Property, plant and equipment                                            |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|Land                                                                     |  |                      |      |  |                    |  |       |                      |  |  |                   |  |  |  | (86    | )
|Buildings                                                                |  |                      |      |  |                    |  |       |                      |  |  |                   |  |  |  | (807   | )
|Manufacturing equipment                                                  |  |                      | 7     |  |                    |  |       |                      |  |  | 41                 |  |  |  | (4,944 | )
|Computer equipment and software                                          |  |                      | 133   |  |                    |  |       |                      |  |  |                   |  |  |  |       |  
|Construction in progress                                                 |  |                      | 86    |  |                    |  |       |                      |  |  |                   |  |  |  |       |  
|                                                                         |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|                                                                         |  |                      | 2,245 |  |                    |  |       |                      |  |  | 791                |  |  |  | (5,837 | )
|                                                                         |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  
|Total                                                                    |  |                      | 8,093 |  |                    |  | (1,031 | )                    |  |  | 6,264              |  |  |  | (6,644 | )
|                                                                         |  |                      |       |  |                    |  |        |                      |  |  |                    |  |  |  |        |  

The assets impaired are substantially related to the manufacturing facility closures and the South Carolina Flood as discussed
in Note 4. Also included are provisions primarily for slow-moving and obsolete inventory.

As of December 31, 2016, the net book value and
recoverable amount of property, plant and equipment remaining following impairments related to the TaraTape Closure is $1.2 million. The net book value includes the effects of ongoing depreciation of the assets continuing to be used in
production operations which ceased December 31, 2016. The fair value of the recoverable amount of the assets at the impairment dates were determined based on the Companys plans and intent to transfer, use or any other value that could be
attributed to the assets.

As of December 31, 2016 and 2015, the net book value and recoverable amount of property, plant and equipment remaining
following impairments related to the South Carolina Flood was nil and $0.6 million, respectively. The net book value includes the effects of ongoing depreciation of the assets continuing to be used until their disposal, which is expected to be
at the completion of the facility closure, restructuring initiative or final sale of the asset. The fair value of the recoverable amount of the assets at the impairment dates were determined using independent market appraisals by regional
real-estate professionals; quoted market values or the Companys plans and intent to transfer, use, sell or any other value that could be attributed to the assets; and estimated costs to repair the assets damaged by the South Carolina Flood.



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##### Table of Contents

The Company used its best estimate in assessing the likely outcome for each of the assets. The recoverable amount
of the assets in all cases was fair value less costs to sell.

The impairment reversals recorded in 2015 relate to improved actual and projected positive
cash flows associated with the Companys shrink film assets in Tremonton, Utah due to the consolidation of shrink film production to that facility in 2012 and 2013, as well as improvements in the related manufacturing processes.

13 -BORROWINGS

Borrowings are comprised of the following for the years ended:



|                                   |  |                   |                            |  |                                         |  |      |   |  |  |         | 
|---------------------------------- |  | ----------------- | -------------------------- |  | --------------------------------------- |  | ---- | - |  |  | ------- | 
|                                   |  | December 31, 2016 |                           
|                                   |  | Maturity          |                            |  | Weighted AverageEffective Interest rate |  |      | $ | 
|Revolving Credit Facility (a) (1)  |  |                   | November 2019              |  |                                         |  | 2.90 | % |  |  | 159,608 | 
|Finance lease liabilities (b)      |  |                   | Various until June 2022    |  |                                         |  | 3.23 | % |  |  | 14,265  | 
|Forgivable government loan (c) (2) |  |                   | January 2024               |  |                                         |  | 1.25 | % |  |  | 3,276   | 
|Mortgage and other loans(d)        |  |                   | Various until October 2024 |  |                                         |  | 7.44 | % |  |  | 2,676   | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  |         | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  | 179,825 | 
|Less: current borrowings           |  |                   |                            |  |                                         |  |      |   |  |  | 7,604   | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  |         | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  | 172,221 | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  |         | 
|                                   | 
|                                   |  | December 31, 2015 |                           
|                                   |  | Maturity          |                            |  | Weighted AverageEffective Interest rate |  |      | $ | 
|Revolving Credit Facility (a) (1)  |  |                   | November 2019              |  |                                         |  | 2.54 | % |  |  | 131,684 | 
|Finance lease liabilities (b)      |  |                   | Various until June 2022    |  |                                         |  | 3.18 | % |  |  | 19,971  | 
|Forgivable government loan (c) (2) |  |                   | January 2024               |  |                                         |  | 1.25 | % |  |  | 1,124   | 
|Mortgage and other loans(d)        |  |                   | Various until October 2024 |  |                                         |  | 0.00 | % |  |  | 57      | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  |         | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  | 152,836 | 
|Less: current borrowings           |  |                   |                            |  |                                         |  |      |   |  |  | 5,702   | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  |         | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  | 147,134 | 
|                                   |  |                   |                            |  |                                         |  |      |   |  |  |         | 



|(1) | The Revolving Credit Facility is presented net of unamortized related debt issue costs, amounting to $1.4 million and $1.7 million as of December 31,
2016 and 2015, respectively.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The forgivable government loan is shown net of imputed interest amounting to $0.2 million and $0.1 million as of December 31, 2016 and 2015,
respectively.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------

Repayments of borrowings are due as follows:



|                                                    |  |                         |        |  |                          |  |         | 
|--------------------------------------------------- |  | ----------------------- | ------ |  | ------------------------ |  | ------- | 
|                                                    |  | Financeleaseliabilities |        |  | Otherlong-termborrowings | 
|                                                    |  | $                       |        |  | $                        | 
|2017                                                |  |                         | 6,078  |  |                          |  | 1,917   | 
|2018                                                |  |                         | 4,788  |  |                          |  | 264     | 
|2019                                                |  |                         | 986    |  |                          |  | 161,734 | 
|2020                                                |  |                         | 424    |  |                          |  | 829     | 
|2021                                                |  |                         | 364    |  |                          |  | 831     | 
|Thereafter                                          |  |                         | 2,639  |  |                          |  | 1,564   | 
|                                                    |  |                         |        |  |                          |  |         | 
|Total payments                                      |  |                         | 15,279 |  |                          |  | 167,139 | 
|Interest expense included in minimum lease payments |  |                         | 1,014  |  |                          |  |        | 
|                                                    |  |                         |        |  |                          |  |         | 
|Total                                               |  |                         | 14,265 |  |                          |  | 167,139 | 
|                                                    |  |                         |        |  |                          |  |         | 



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##### Table of Contents

|(a) | Revolving Credit Facility
|--- | -------------------------

On November 18, 2014, the Company entered into a five-year,
$300 million revolving credit facility (Revolving Credit Facility) with a syndicate of financial institutions.

The Revolving Credit
Facility matures on November 18, 2019 and bears an interest rate based primarily on the LIBOR (London Interbank Offered Rates), or other floating rate for credit loans denominated in an alternative currency, plus a spread varying between 100
and 225 basis points depending on the consolidated total leverage ratio (150 basis points as of December 31, 2016 and 2015). Revolving credit loans denominated in the alternative currency of Canadian dollars bear interest primarily at the CDOR
(Canadian Dollar Offer Rate) plus the applicable margin mentioned above and any mandatory costs. Interest payments on base rate loans, which consist of all loan draws not funded with a floating rate contract, are due and payable in arrears on the
last business day of each calendar quarter. Interest payments on floating rate loans are due and payable on the last day of each interest period. If such interest period extends over three months, interest is due at the end of each three-month
interval during such interest period.

The credit agreement also includes an incremental accordion feature of $150 million, which enables the Company
to increase the limit of the Revolving Credit Facility, subject to the credit agreements terms and lender approval, if needed. Such incremental revolving credit increase matures on the revolving credit maturity date and bears interest at the
rate applicable to the revolving credit loans.

As of December 31, 2016, the Revolving Credit Facilitys outstanding balance amounted to
$162.8 million, which consisted of $161.0 million of borrowed funds ($159.6 million, net of $1.4 million in unamortized debt issue costs) and $1.8 million in standby letters of credit. Accordingly, the Companys unused
availability as of December 31, 2016 amounted to $137.2 million.

The Revolving Credit Facility is secured by a first priority lien on all
personal property of the Company and all current and future material subsidiaries, excluding Powerband.

As of December 31, 2016, the Revolving
Credit Facility has, in summary, three financial covenants: (i) a consolidated total leverage ratio not to be greater than 3.25 to 1.00, with an allowable temporary increase to 3.75 to 1.00 for the four quarters following an acquisition with a
price not less than $50 million, (ii) a consolidated debt service ratio not to be less than 1.50 to 1.00, and (iii) the aggregated amount of all capital expenditures in any fiscal year may not exceed $50 million (as discussed in
the next paragraph this covenant was amended in January 2017). Any portion of the allowable $50 million related to capital expenditures which is not expended in the current year may be carried over for expenditure in the following year, but may
not be carried over to any additional subsequent years thereafter (as such, the allowable capital expenditures were $65.7 million in 2016 and $59.4 million in 2015 due to a carry forward provision of unused capital expenditures amounts
from the prior year). The Company was in compliance with the consolidated total leverage ratio, consolidated debt service ratio and capital expenditures limit which were 1.53, 7.34 and $49.9 million, respectively, as of December 31, 2016.
A default under the Revolving Credit Facility is deemed a default under the equipment finance agreement referred to below.

In January 2017, the
Companys Revolving Credit Facility was in part amended to increase the limit of allowable capital expenditures in any fiscal year from 2017 onwards to $100 million and amounts not expended in the year are no longer able to be carried over
to the next year.



|(b) | Finance lease liabilities
|--- | -------------------------

The Company has obligations under finance lease liabilities for the rental of
a building, computer hardware, manufacturing equipment and office equipment, payable in monthly installments ranging from $127 to $263,450, including interest, for both 2016 and 2015. In addition, a $2.5 million lump sum payment is due in June
2022, under one of the lease liabilities. The finance lease liabilities are secured by the assets under the lease liabilities.



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##### Table of Contents

On August 14, 2012, the Company entered into a secured debt equipment finance agreement in the amount of up
to $24.0 million for qualifying US capital expenditures during the period May 2012 through March 31, 2014. The amount available under the facility was increased to $25.7 million as of March 26, 2014. The terms of the arrangement
include multiple individual finance leases, each of which have a term of 60 months and a fixed interest rate of 2.74%, 2.90%, and 2.95% for leases scheduled prior to January 1, 2013, January 1, 2014, and March 31, 2014, respectively.
The Company entered into the final schedule on March 26, 2014.

The Company entered into the following schedules:



|                   |  |        |              |  |               |  |      |                 |  |  |                  |  |  |  |                 | 
|------------------ |  | ------ | ------------ |  | ------------- |  | ---- | --------------- |  |  | ---------------- |  |  |  | --------------- | 
|Date entered       |  | Amount |              |  | Interest rate |  |      | MonthlyPayments |  |  | Last payment due | 
|                   |  | $      |              |  |               |  |      | $               |  |  |                  | 
|September 27, 2012 |  |        | 2.7 million  |  |               |  | 2.74 | %               |  |  | 48,577           |  |  |  | October 1, 2017 | 
|December 28, 2012  |  |        | 2.6 million  |  |               |  | 2.74 | %               |  |  | 46,258           |  |  |  | January 1, 2018 | 
|June 28, 2013      |  |        | 2.2 million  |  |               |  | 2.90 | %               |  |  | 39,329           |  |  |  | July 1, 2018    | 
|December 31, 2013  |  |        | 14.7 million |  |               |  | 2.90 | %               |  |  | 263,450          |  |  |  | January 1, 2019 | 
|March 26, 2014     |  |        | 3.5 million  |  |               |  | 2.95 | %               |  |  | 62,263           |  |  |  | April 1, 2019   | 

The schedules are secured by the equipment with a net book value of $20.6 million as of December 31, 2016
($21.9 million in 2015).



|(c) | Forgivable government loans
|--- | ---------------------------

In August 2015, one of the Companys wholly-owned subsidiaries entered
into a partially forgivable loan. The loan was entered into with Agencia para Investmento Comercio Externo de Portugal, EPE (AICEP), the Portuguese agency for investment and external trade, as part of financing a capital expansion project. Based on
the terms of the agreement, 50% of the loan will be forgiven in 2020 based on satisfying certain 2019 targets, including financial metrics and headcount additions. The partially forgivable loan is non-interest
bearing and semi-annual installments of principal are due beginning in July 2018 through January 2024.

To reflect the benefit of the interest-free
status, the loan was discounted to its estimated fair value using a discount rate of 1.25% which reflects the borrowing cost of the Companys wholly-owned subsidiary. The loan totalled $3.3 million ( 3.1 million) as of
December 31, 2016 and $1.2 million ( 1.1 million) as of December 31, 2015. The difference between the gross proceeds and the fair value of the loan is the benefit derived from the interest-free loan and is recognized as
deferred income in the balance sheet in the caption other liabilities in the amount of $0.2 million and $0.1 million as of December 31, 2016 and 2015, respectively. When the capital expansion assets are placed into service, the
deferred income will be recognized in earnings through cost of sales on a systematic basis over the related assets useful lives. In addition, imputed interest expense will be recorded over the life of the loan so that at the end of the loan
period the amount to be reimbursed will equal the nominal amount. Interest expense of less than $0.1 million was recognized on this loan in 2016.



|(d) | Mortgage and other loans
|--- | ------------------------

In October 2015, one of the Companys wholly-owned subsidiaries entered
into a long-term debt agreement containing a short-term credit line and a long-term loan for up to $8.2 million ( 7.8 million) for the purpose of financing a capital expansion project. As of December 31, 2016, $0.7 million
( 0.7 million) of the short-term credit line was utilized. Accordingly, the unused availability as of December 31, 2016 amounted to $7.5 million ( 7.1 million). No amounts were outstanding as of December 31,
2015. The credit lines bear interest at the rate of 6 month EURIBOR (Euro Interbank Offered Rate) plus a premium (125 basis points as of December 31, 2016 and 2015). The effective interest rate was 1.25% and 1.21% as of December 31, 2016
and 2015, respectively. The short-term credit line matures in September 2017 and is renewable annually, with interest due quarterly and billed in arrears. The long-term loan has a period for capital use until October 2017 and matures in April 2022,
with interest billed in arrears and due bi-annually beginning in April 2018. The loans are secured by a comfort letter issued to the lender by the Company in favour of its wholly-owned subsidiary.



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##### Table of Contents

In September 2016, the Company acquired 74% of the issued and outstanding shares in Powerband (refer to Note 17
for more information regarding the acquisition). The partially owned subsidiary maintains a cash flow loan facility which matures July 2017 and bears interest at the prevailing Indian Marginal Cost-Lending Rate plus a premium (60 basis points as of
December 31, 2016). The overall facility limit is $2.3 million (INR 155 million) of which $0.9 million (INR 59 million) was used as of December 31, 2016. Accordingly, the unused availability as of December 31, 2016 amounted
to $1.4 million (INR 96 million). The partially owned subsidiary also maintains two term loans. One term loan is repayable in equal semi-annual installments and matures in November 2017. The loan bears interest at a rate based on the 3 month
LIBOR plus a premium (250 basis points as of December 31, 2016). The loan totalled $0.2 million (INR 14.5 million) as of December 31, 2016. The second term loan is repayable in 60 equal monthly installments and matures in December
2021. The loan has a fixed interest rate of 10.61%. The second term loan totalled $0.9 million (INR 62 million) as of December 31, 2016.

14
-PROVISIONS AND CONTINGENT LIABILITIES

The Companys current provisions consist of environmental and
restoration obligations, litigation and termination benefits and other provisions.

The reconciliation of the Companys provisions is as follows:



|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|-------------------------------- |  | ---------- | ------ | - | ------------- |  | ----- | ----------- |  |  | ----------------------------- | - |  | ----- | ------ | - |  |  | ------ | -
|                                 |  |            |        |   | Environmental |  |       | Restoration |  |  | Terminationbenefits and other |   |  | Total |       
|                                 |  |            |        |   | $             |  |       | $           |  |  | $                             |   |  | $     |       
|Balance, December 31, 2014       |  |            |        |   |               |  | 2,518 |             |  |  | 917                           |   |  |       | 2,875  |   |  |  | 6,310  |  
|Additional provisions            |  |            |        |   |               |  |      |             |  |  | 1,026                         |   |  |       | 1,397  |   |  |  | 2,423  |  
|Amounts used                     |  |            |        |   |               |  | (12   | )           |  |  |                              |   |  |       | (3,040 | ) |  |  | (3,052 | )
|Amounts reversed                 |  |            |        |   |               |  |      |             |  |  |                              |   |  |       | (439   | ) |  |  | (439   | )
|Net foreign exchange differences |  |            |        |   |               |  |      |             |  |  | (71                           | ) |  |       | (20    | ) |  |  | (91    | )
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|Balance, December 31, 2015       |  |            |        |   |               |  | 2,506 |             |  |  | 1,872                         |   |  |       | 773    |   |  |  | 5,151  |  
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|Amount presented as current      |  |            |        |   |               |  | 1,473 |             |  |  | 50                            |   |  |       | 686    |   |  |  | 2,209  |  
|Amount presented as non-current  |  |            |        |   |               |  | 1,033 |             |  |  | 1,822                         |   |  |       | 87     |   |  |  | 2,942  |  
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|Balance, December 31, 2015       |  |            |        |   |               |  | 2,506 |             |  |  | 1,872                         |   |  |       | 773    |   |  |  | 5,151  |  
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|                                 |  |            |        |   |              
|                                 |  | Litigation |        |   | Environmental |  |       | Restoration |  |  | Terminationbenefits and other |   |  | Total |       
|                                 |  |            |        |   | $             |  |       | $           |  |  | $                             |   |  | $     |       
|Balance, December 31, 2015       |  |            | 180    |   |               |  | 2,506 |             |  |  | 1,872                         |   |  |       | 593    |   |  |  | 5,151  |  
|Additional provisions            |  |            | 1,903  |   |               |  |      |             |  |  | 50                            |   |  |       | 1,789  |   |  |  | 3,742  |  
|Amounts used                     |  |            | (1,940 | ) |               |  |      |             |  |  | (47                           | ) |  |       | (1,002 | ) |  |  | (2,989 | )
|Amounts reversed                 |  |            |       |   |               |  |      |             |  |  | (28                           | ) |  |       |       |   |  |  | (28    | )
|Net foreign exchange differences |  |            |       |   |               |  |      |             |  |  | 12                            |   |  |       | 3      |   |  |  | 15     |  
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|Balance, December 31, 2016       |  |            | 143    |   |               |  | 2,506 |             |  |  | 1,859                         |   |  |       | 1,383  |   |  |  | 5,891  |  
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|Amount presented as current      |  |            | 143    |   |               |  | 1,473 |             |  |  | 942                           |   |  |       | 1,293  |   |  |  | 3,851  |  
|Amount presented as non-current  |  |            |       |   |               |  | 1,033 |             |  |  | 917                           |   |  |       | 90     |   |  |  | 2,040  |  
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  
|Balance, December 31, 2016       |  |            | 143    |   |               |  | 2,506 |             |  |  | 1,859                         |   |  |       | 1,383  |   |  |  | 5,891  |  
|                                 |  |            |        |   |               |  |       |             |  |  |                               |   |  |       |        |   |  |  |        |  



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The environmental provision pertains to the South Carolina Project.

The restoration provision pertains to leases at operating facilities where the Company is obligated to restore the leased properties to the same condition
that existed at the lease commencement date. The carrying amount of this obligation is based on managements best estimate of the costs of the permanent removal of the Companys manufacturing equipment used in these facilities.

As a result of the TaraTape and Better Packages acquisitions in 2015, the Company recorded additional restoration provisions associated with these leased
facilities totalling $0.9 million.

The termination benefits and other provisions relate primarily to the TaraTape Closure and the South Carolina
Project termination benefits and other labour related costs. The accelerated closure of the Columbia, South Carolina facility as a result of the South Carolina Flood had minimal impact on the timing of payouts associated with termination benefits.
See Note 4 for more information.

On November 5, 2015, the Companys former Chief Financial Officer filed a lawsuit against the Company in the
United States District Court for the Middle District of Florida alleging certain violations by the Company related to the terms of his employment and his termination. As of December 31, 2015, the Company was not able to predict the probability
of a favourable or unfavourable outcome, or the amount of any possible loss in the event of an unfavourable outcome. Consequently, no material provision or liability was recorded for these allegations and claims as of December 31, 2015. In
addition, upon termination and in accordance with the existing employment agreement between the Company and the former Chief Financial Officer, a termination benefit accrual of $0.4 million had been recorded as of December 31, 2014. Terms
of such agreement were not met within the timeframe specified therein and the termination benefit accrual was consequently reversed during the year ended December 31, 2015.

On October 20, 2016, the Company and the former Chief Financial Officer agreed to a settlement of the outstanding litigation. Pursuant to the terms of
the confidential settlement agreement, the Company paid $1.9 million for full and complete settlement of all matters between the parties with respect to the litigation.

The Company is engaged from time-to-time in various legal proceedings and
claims that have arisen in the ordinary course of business. The outcome of all of the proceedings and claims against the Company is subject to future resolution, including the uncertainties of litigation. Based on information currently known to the
Company and after consultation with outside legal counsel, management believes that the probable ultimate resolution of any such proceedings and claims, individually or in the aggregate, will not have a material adverse effect on the financial
condition of the Company, taken as a whole, and accordingly, no material amounts have been recorded as of December 31, 2016.

As of December 31,
2016 and 2015:



| |  |  | No reimbursements are expected to be received by the Company for any of the provided amounts; and
| | - |  | -------------------------------------------------------------------------------------------------



| |  |  | There were no contingent assets at any of the financial statement reporting dates covered by these consolidated financial statements.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------



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15 -OTHER LIABILITIES

Other liabilities are comprised of the following for the years ended:



|                                                |  |                  |        |  |                  |  |       | 
|----------------------------------------------- |  | ---------------- | ------ |  | ---------------- |  | ----- | 
|                                                |  | December 31,2016 |        |  | December 31,2015 | 
|                                                |  | $                |        |  | $                | 
|Non-controlling interest put options            |  |                  | 10,020 |  |                  |  |      | 
|Deferred rent, income taxes and utility credits |  |                  | 641    |  |                  |  | 418   | 
|Interest rate swap agreements                   |  |                  | 219    |  |                  |  | 438   | 
|Deferred employee compensation and other        |  |                  | 678    |  |                  |  | 173   | 
|                                                |  |                  |        |  |                  |  |       | 
|                                                |  |                  | 11,558 |  |                  |  | 1,029 | 
|                                                |  |                  |        |  |                  |  |       | 

In connection with the Powerband Acquisition, the Company entered into a shareholders agreement that contains put
options, which provide a single non-controlling interest shareholder with the right to require the Company to purchase its retained interest at a variable purchase price. The purchase price is the greater of
the amount determined using a valuation method defined in the agreement or a fair market valuation performed by an independent and qualified expert. Execution of this agreement resulted in the immediate recognition of $10,181 in present obligations
recorded in other liabilities, and a corresponding reduction of equity on the consolidated balance sheet as of September 16, 2016. Put options relating to 50% of the other shareholders shares are exercisable at any time after three years
from the closing date of the acquisition (which is September 16, 2019), and put options relating to the remaining 50% of the other shareholders shares are exercisable at any time after five years from the closing date (which is
September 16, 2021).

Refer to Note 22 for more information regarding the fair value of the non-controlling
interest put options and interest rate swap agreements and Note 17 for additional information on acquisitions.

16 -CAPITAL STOCK

Authorized

The Company
is authorized to issue an unlimited number of common shares without par value.

Class A preferred shares, issuable in series, rank in priority
to the common shares with respect to dividends and return of capital on dissolution. The Board of Directors is authorized to fix, before issuance, the designation, rights, privileges, restrictions and conditions attached to the shares of each
series. No Class A preferred shares have been issued.

Common Shares

The Companys common shares outstanding as of December 31, 2016 and 2015, were 59,060,335 and 58,667,535, respectively.



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Dividends

Cash dividends paid are as follows for each of the years in the three-year period ended December 31, 2016:



|                  |  |                    |  |                       |      |  |                         |                    |                                   |  |            |                      |  |   |       | 
|----------------- |  | ------------------ |  | --------------------- | ---- |  | ----------------------- | ------------------ | --------------------------------- |  | ---------- | -------------------- |  | - | ----- | 
|Declared
Date     |  | Paid date          |  | Per commonshareamount |      |  | Shareholder
record date |                    | Commonshares issuedandoutstanding |  |            | Aggregatepayment (1) | 
|February 6, 2014  |  | March 31, 2014     |  | $                     | 0.08 |  |                         | March 19, 2014     |                                   |  | 60,776,649 |                      |  | $ | 4,875 | 
|May 7, 2014       |  | June 30, 2014      |  | $                     | 0.08 |  |                         | June 17, 2014      |                                   |  | 60,951,976 |                      |  | $ | 4,927 | 
|August 5, 2014    |  | September 30, 2014 |  | $                     | 0.12 |  |                         | September 15, 2014 |                                   |  | 60,423,976 |                      |  | $ | 7,196 | 
|November 4, 2015  |  | December 31, 2014  |  | $                     | 0.12 |  |                         | December 15, 2014  |                                   |  | 60,436,476 |                      |  | $ | 7,251 | 
|March 9, 2015     |  | March 31, 2015     |  | $                     | 0.12 |  |                         | March 19, 2015     |                                   |  | 60,355,638 |                      |  | $ | 7,303 | 
|May 11, 2015      |  | June 30, 2015      |  | $                     | 0.12 |  |                         | June 15, 2015      |                                   |  | 59,621,238 |                      |  | $ | 7,154 | 
|August 12, 2015   |  | September 30, 2015 |  | $                     | 0.13 |  |                         | September 15, 2015 |                                   |  | 59,502,185 |                      |  | $ | 7,706 | 
|November 11, 2015 |  | December 31, 2015  |  | $                     | 0.13 |  |                         | December 15, 2015  |                                   |  | 58,667,535 |                      |  | $ | 7,532 | 
|March 9, 2016     |  | March 31, 2016     |  | $                     | 0.13 |  |                         | March 21, 2016     |                                   |  | 58,522,835 |                      |  | $ | 7,509 | 
|May 9, 2016       |  | June 30, 2016      |  | $                     | 0.13 |  |                         | June 15, 2016      |                                   |  | 58,602,835 |                      |  | $ | 7,574 | 
|August 10, 2016   |  | September 30, 2016 |  | $                     | 0.14 |  |                         | September 15, 2016 |                                   |  | 58,621,585 |                      |  | $ | 8,235 | 
|November 10, 2016 |  | December 30, 2016  |  | $                     | 0.14 |  |                         | December 15, 2016  |                                   |  | 59,060,335 |                      |  | $ | 8,047 | 



|(1) | Aggregate dividend payment amounts presented in the table above are adjusted for the impact of foreign exchange rates on cash payments to shareholders.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------

Share repurchase

The Company entered into an NCIB to
repurchase for cancellation up to 2,000,000 common shares effective on July 10, 2014. The NCIB was subsequently renewed July 10, 2015 and amended November 11, 2015, to increase the total shares available for repurchase to 4,000,000
common shares. This NCIB, which was scheduled to expire on July 9, 2016, was renewed for a twelve-month period starting July 14, 2016. This renewed NCIB expires on July 13, 2017. As of December 31, 2016 and March 8, 2017,
4,000,000 shares remained available for repurchase under the NCIB.

Information regarding share repurchases is presented in the table below:



|                                                     |  |              |         |  |      |      |           | 
|---------------------------------------------------- |  | ------------ | ------- |  | ---- | ---- | --------- | 
|                                                     |  | December 31, |        
|                                                     |  | 2016         |         |  | 2015 |     
|Common shares repurchased                            |  |              | 147,200 |  |      |      | 2,487,188 | 
|Average price per common share including commissions |  | CDN$         | 15.77   |  |      | CDN$ | 15.52     | 
|                                                     | 
|                                                     |  | December 31, |        
|                                                     |  | 2016         |         |  | 2015 |     
|                                                     |  | $            |         |  | $    |     
|Carrying value of the common shares repurchased      |  |              | 862     |  |      |      | 14,973    | 
|Share repurchase premium (1)                         |  |              | 835     |  |      |      | 15,011    | 
|                                                     |  |              |         |  |      |      |           | 
|Total purchase price including commissions           |  |              | 1,697   |  |      |      | 29,984    | 
|                                                     |  |              |         |  |      |      |           | 



|(1) | The excess of the purchase price paid over the carrying value of the common shares repurchased is recorded in deficit in the consolidated balance sheet and in the
statement of consolidated changes in equity.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Stock options

Under the Companys ESOP, stock options to acquire the Companys common shares may be granted to the Companys executives, directors and key
employees. The total number of common shares reserved for issuance under the ESOP is equal to 10% of the Companys issued and outstanding common shares from time to time. Stock options are equity-settled and expire no later than 10 years after
the date of the



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grant and can be used only to purchase stock and may not be redeemed for cash. The ESOP provides that such stock options granted to key employees and executives will vest and may be exercisable
25% per year over four years. The stock options granted to directors, who are not officers of the Company, will vest and may be exercisable 25% on the grant date, and a further 25% will vest and may be exercisable per year over three years.

All stock options are granted at a price determined and approved by the Board of Directors, which cannot be less than the closing price of the common shares
on the TSX for the day immediately preceding the effective date of the grant.

The changes in number of stock options outstanding were as follows:



|                           |  |                              |       |  |                  |  |           |                              |  |  |                  |  |  |                              |           |   |                  |  |       |  |  |  |           |  
|-------------------------- |  | ---------------------------- | ----- |  | ---------------- |  | --------- | ---------------------------- |  |  | ---------------- |  |  | ---------------------------- | --------- | - | ---------------- |  | ----- |  |  |  | --------- | -
|                           |  | 2016                         |       |  | 2015             |  |           | 2014                         | 
|                           |  | Weightedaverageexerciseprice |       |  | Number ofoptions |  |           | Weightedaverageexerciseprice |  |  | Number ofoptions |  |  | Weightedaverageexerciseprice |           |   | Number ofoptions | 
|                           |  | CDN$                         |       |  |                  |  |           | CDN$                         |  |  |                  |  |  | CDN$                         |           |   |                  | 
|Balance, beginning of year |  |                              | 8.78  |  |                  |  | 1,617,500 |                              |  |  | 7.01             |  |  |                              | 2,360,000 |   |                  |  | 5.52  |  |  |  | 2,264,177 |  
|Granted                    |  |                              |      |  |                  |  |          |                              |  |  |                 |  |  |                              |          |   |                  |  | 12.51 |  |  |  | 492,500   |  
|Exercised                  |  |                              | 3.56  |  |                  |  | (540,000  | )                            |  |  | 2.79             |  |  |                              | (712,500  | ) |                  |  | 3.60  |  |  |  | (256,677  | )
|Forfeited                  |  |                              | 12.35 |  |                  |  | (16,250   | )                            |  |  | 12.30            |  |  |                              | (30,000   | ) |                  |  | 8.38  |  |  |  | (140,000  | )
|                           |  |                              |       |  |                  |  |           |                              |  |  |                  |  |  |                              |           |   |                  |  |       |  |  |  |           |  
|Balance, end of year       |  |                              | 11.38 |  |                  |  | 1,061,250 |                              |  |  | 8.78             |  |  |                              | 1,617,500 |   |                  |  | 7.01  |  |  |  | 2,360,000 |  
|                           |  |                              |       |  |                  |  |           |                              |  |  |                  |  |  |                              |           |   |                  |  |       |  |  |  |           |  

The weighted average fair value per stock option granted in 2014 was $3.12 using the Black-Scholes option pricing model,
taking into account the following weighted average assumptions:



|                                 |  |      |           |  
|-------------------------------- |  | ---- | --------- | -
|                                 |  | 2014 |          
|Expected life                    |  |      | 5.6 years |  
|Expected volatility(1)           |  |      | 38        | %
|Risk-free interest rate          |  |      | 1.75      | %
|Expected dividends               |  |      | 2.83      | %
|Stock price at grant date        |  | CDN$ | 12.51     |  
|Exercise price of awards         |  | CDN$ | 12.51     |  
|Foreign exchange rate USD to CDN |  |      | 1.1070    |  



|(1) | Expected volatility was calculated by applying a weighted average of the daily closing price change on the TSX for a term commensurate with the expected life of each
grant, with more weight placed on the more recent time periods.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The following table summarizes information about stock options outstanding
and exercisable as of:



|                         |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |         |  |  |  |       | 
|------------------------ |  | ------------------- | --------- |  | -------------------------------------- |  | ---- | ----------------------------- |  |  | ------ |  |  | ----------------------------- | ------- |  |  |  | ----- | 
|                         |  | Options outstanding |           |  | Options exercisable                    | 
|                         |  | Number              |           |  | Weightedaveragecontractuallife (years) |  |      | Weightedaverageexercise price |  |  | Number |  |  | Weightedaverageexercise price |        
|                         |  |                     |           |  |                                        |  |      | CDN$                          |  |  |        |  |  | CDN$                          |        
|December 31, 2016        |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |         |  |  |  |       | 
|Range of exercise prices |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |         |  |  |  |       | 
|$1.55 to $1.80           |  |                     | 90,000    |  |                                        |  | 0.47 |                               |  |  | 1.73   |  |  |                               | 90,000  |  |  |  | 1.73  | 
|$12.04 to $14.34         |  |                     | 971,250   |  |                                        |  | 4.53 |                               |  |  | 12.27  |  |  |                               | 602,500 |  |  |  | 12.20 | 
|                         |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |         |  |  |  |       | 
|                         |  |                     | 1,061,250 |  |                                        |  | 4.18 |                               |  |  | 11.38  |  |  |                               | 692,500 |  |  |  | 10.84 | 
|                         |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |         |  |  |  |       | 



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|                                        |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |           |  |  |  |       | 
|--------------------------------------- |  | ------------------- | --------- |  | -------------------------------------- |  | ---- | ----------------------------- |  |  | ------ |  |  | ----------------------------- | --------- |  |  |  | ----- | 
|                                        |  | Options outstanding |           |  | Options exercisable                    | 
|                                        |  | Number              |           |  | Weightedaveragecontractuallife (years) |  |      | Weightedaverageexercise price |  |  | Number |  |  | Weightedaverageexercise price |          
|                                        |  |                     |           |  |                                        |  |      | CDN$                          |  |  |        |  |  | CDN$                          |          
|December 31, 2015                       |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |           |  |  |  |       | 
|Range of exercise prices $1.55 to $2.19 |  |                     | 536,250   |  |                                        |  | 4.00 |                               |  |  | 1.65   |  |  |                               | 536,250   |  |  |  | 1.65  | 
|$12.04 to $14.34                        |  |                     | 1,081,250 |  |                                        |  | 5.35 |                               |  |  | 12.31  |  |  |                               | 414,375   |  |  |  | 12.25 | 
|                                        |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |           |  |  |  |       | 
|                                        |  |                     | 1,617,500 |  |                                        |  | 4.90 |                               |  |  | 8.78   |  |  |                               | 950,625   |  |  |  | 6.27  | 
|                                        |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |           |  |  |  |       | 
|                                        |  |                    
|                                        |  | Options outstanding |           |  | Options exercisable                    | 
|                                        |  | Number              |           |  | Weightedaveragecontractuallife (years) |  |      | Weightedaverageexercise price |  |  | Number |  |  | Weightedaverageexercise price |          
|                                        |  |                     |           |  |                                        |  |      | CDN$                          |  |  |        |  |  | CDN$                          |          
|December 31, 2014                       |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |           |  |  |  |       | 
|Range of exercise prices $1.55 to $2.19 |  |                     | 1,190,000 |  |                                        |  | 4.37 |                               |  |  | 1.81   |  |  |                               | 1,043,750 |  |  |  | 1.84  | 
|$12.04 to $14.34                        |  |                     | 1,170,000 |  |                                        |  | 6.22 |                               |  |  | 12.30  |  |  |                               | 177,500   |  |  |  | 12.15 | 
|                                        |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |           |  |  |  |       | 
|                                        |  |                     | 2,360,000 |  |                                        |  | 5.29 |                               |  |  | 7.01   |  |  |                               | 1,221,250 |  |  |  | 3.33  | 
|                                        |  |                     |           |  |                                        |  |      |                               |  |  |        |  |  |                               |           |  |  |  |       | 

Performance Share Unit Plan

On April 22, 2014, the Board of Directors of the Company adopted the PSU Plan. The purpose of the PSU Plan is to provide participants with a proprietary
interest in the Company to (a) increase the incentives of those participants who share primary responsibility for the management, growth and protection of the business of the Company, (b) furnish an incentive to such participants to
continue their services for the Company and (c) provide a means through which the Company may attract potential employees. The PSU Plan is administered by the Compensation Committee of the Board of Directors of the Company and authorizes the
Company to award PSUs to eligible persons. A PSU, as defined by the Companys PSU Plan, represents the right of a participant, once such PSU is earned and has vested in accordance with the PSU Plan, to receive (prior to the amendments discussed
below and in Note 23) the number of common shares of the Company underlying the PSU. Furthermore, a participant will receive a cash payment from the Company upon PSU settlement that is equivalent to the number of shares issued or delivered to the
participant multiplied by the amount of cash dividends per share declared by the Company between the date of grant and the third anniversary of the grant date. PSUs are net-settled to satisfy minimum statutory
tax withholding requirements.

On May 9, 2016, the Board of Directors approved an amendment to the PSU Plan to provide the Company the option of
settling PSUs in cash. In the event of cash settlement, the cash payment will equal the number of shares that would otherwise have been issued or delivered to the participant, multiplied by the volume weighted average trading price
(VWAP) of the shares on the TSX for the five consecutive trading days immediately preceding the day of payment. The Board has full discretion to determine the form of settlement of the PSUs and as of December 31, 2016, no such
discretion had been used. As a result, the Company had no obligation to settle the PSUs in cash as of December 31, 2016 and the amendment to the PSU Plan had no impact on the treatment of the PSUs as equity-settled share-based payment
transactions as of December 31, 2016. See Note 23 for a discussion of amendments to the PSU Plan approved on February 17, 2017.

Additionally,
on the same date, the Board of Directors approved an amendment to the PSU Plan that allowed for accelerated vesting of PSUs in the event of death, disability or retirement of a participant. This amendment required the immediate recognition of
expense associated with awards outstanding for certain retirement-eligible participants, the impact of which was $0.4 million for the year ended December 31, 2016, and was included in earnings in selling, general and administrative
expense.



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The following table summarizes information about PSUs:



|                           |  |                           |       |  |               |  |         |                           |  |  |               |  |  |                           |         |   |               |  |       |  |  |  |         | 
|-------------------------- |  | ------------------------- | ----- |  | ------------- |  | ------- | ------------------------- |  |  | ------------- |  |  | ------------------------- | ------- | - | ------------- |  | ----- |  |  |  | ------- | 
|                           |  | 2016                      |       |  | 2015          |  |         | 2014                      | 
|                           |  | Weightedaveragefair value |       |  | Number ofPSUs |  |         | Weightedaveragefair value |  |  | Number ofPSUs |  |  | Weightedaveragefair value |         |   | Number ofPSUs | 
|Balance, beginning of year |  |                           | 12.99 |  |               |  | 498,040 |                           |  |  | 11.38         |  |  |                           | 152,500 |   |               |  |      |  |  |  |        | 
|Granted                    |  |                           | 13.85 |  |               |  | 422,733 |                           |  |  | 13.64         |  |  |                           | 363,600 |   |               |  | 11.38 |  |  |  | 152,500 | 
|Forfeited                  |  |                           | 12.80 |  |               |  | (28,696 | )                         |  |  | 12.54         |  |  |                           | (18,060 | ) |               |  |      |  |  |  |        | 
|                           |  |                           |       |  |               |  |         |                           |  |  |               |  |  |                           |         |   |               |  |       |  |  |  |         | 
|Balance, end of year       |  |                           | 13.41 |  |               |  | 892,077 |                           |  |  | 12.99         |  |  |                           | 498,040 |   |               |  | 11.38 |  |  |  | 152,500 | 
|                           |  |                           |       |  |               |  |         |                           |  |  |               |  |  |                           |         |   |               |  |       |  |  |  |         | 

The weighted average fair value of PSUs granted was estimated based on a Monte Carlo simulation model, taking into account the
following weighted average assumptions:



|                                     |  |      |         |   |      |      |         |      |  |      |         |  
|------------------------------------ |  | ---- | ------- | - | ---- | ---- | ------- | ---- |  | ---- | ------- | -
|                                     |  | 2016 |         |   | 2015 |      |         | 2014 | 
|Expected life                        |  |      | 3 years |   |      |      | 3 years |      |  |      | 3 years |  
|Expected volatility(1)               |  |      | 36      | % |      |      | 35      | %    |  |      | 38      | %
|Risk-free interest rate              |  |      | 1.09    | % |      |      | 1.07    | %    |  |      | 0.91    | %
|Expected dividends(2)                |  |      | 0.00    | % |      |      | 0.00    | %    |  |      | 0.00    | %
|Performance period starting
price(3) |  | CDN$ | 18.89   |   |      | CDN$ | 17.86   |      |  | CDN$ | 12.74   |  
|Stock price at grant date            |  | CDN$ | 18.90   |   |      | CDN$ | 17.53   |      |  | CDN$ | 12.72   |  



|(1) | Expected volatility was calculated based on the daily dividend adjusted closing price change on the TSX for a term commensurate with the expected life of the grant.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | There is no impact from expected future dividends in the Monte Carlo simulation model as a participant will receive a cash payment from the Company upon PSU
settlement that is equivalent to (a) the number of shares issued or delivered to the participant or, in the event of cash settlement, an amount equal to the number of shares that would otherwise have been issued or delivered to the participant,
multiplied by (b) the amount of cash dividends per share declared by the Company between the date of grant and the third anniversary of the grant date. As of December 31, 2016, the Company accrued in the consolidated balance sheets in
accounts payable and accrued liabilities $0.2 million (nil as of December 31, 2015) for payments expected in the next twelve months and $0.3 million ($0.1 million as of December 31, 2015) in other liabilities for payments
expected after twelve months.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | The performance period starting price is measured as the five-day VWAP for the common shares of the Company on the TSX on the
grant date.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------

PSUs are expensed on a straight-line basis over their vesting period. The PSUs are normally earned over a three-year period
with vesting at the third anniversary of the grant date unless vesting is accelerated based on retirement eligibility, death or disability.

The number of
shares earned can range from 0% to 150% of the grant amount based on the total shareholder return (TSR) ranking versus a specified peer group of companies. As of December 31, 2016, the Companys TSR ranking was such that if all
PSUs outstanding were to be settled as of December 31, 2016, the number of shares earned would be 150% of the grants awarded.

Deferred Share Unit
Plan

On April 22, 2014, the Board of Directors of the Company adopted the DSU Plan. The purpose of the DSU Plan is to provide participants with a
form of compensation which promotes greater alignment of the interests of the participants and the shareholders of the Company in creating long-term shareholder value. The DSU Plan is administered by the Compensation Committee of the Board of
Directors of the Company and authorizes the Company to award DSUs to any member of the Board of Directors of the Company who is not an executive officer or employee of the Company. A DSU, as defined by the DSU Plan, represents the right of a
participant to receive (prior to the amendments discussed in Note 23) a common



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share of the Company. Under the DSU Plan, each non-executive director is entitled to receive DSUs as a result of a grant and/or in lieu of cash for
semi-annual directors fees. DSUs are settled when the director ceases to be a member of the Board of Directors of the Company. DSUs are net-settled to satisfy minimum statutory tax withholding
requirements.

DSUs received as a result of a grant are expensed immediately. The fair value of DSUs is based on the VWAP of the Companys common
shares on the TSX for the five trading days in an open period preceding the date of grant.

DSUs received in lieu of cash for directors fees are
expensed as earned over the service period. The fair value of DSUs is based on the fair value of services rendered.

The following table summarizes
information about DSUs for the two-year period ended December 31, 2016:



|                                                                                                                  |  |      |         |  |      |   |         |  
|----------------------------------------------------------------------------------------------------------------- |  | ---- | ------- |  | ---- | - | ------- | -
|                                                                                                                  |  | 2016 |         |  | 2015 |  
|DSUs granted                                                                                                      |  |      | 52,665  |  |      |   | 46,142  |  
|Weighted average fair value per DSU granted                                                                       |  | $    | 16.76   |  |      | $ | 15.09   |  
|Stock-based compensation expense recognized for DSUs received in lieu of cash for directors
fees not yet granted |  | $    | 143     |  |      | $ | 134     |  
|                                                                                                                  |  |     
|DSUs outstanding                                                                                                  |  |      | 119,248 |  |      |   | 66,583  |  
|Weighted average fair value per DSU outstanding                                                                   |  | $    | 15.04   |  |      | $ | 13.61   |  
|                                                                                                                  |  |     
|Shares issued upon DSU settlement: DSUs settled                                                                   |  |      |        |  |      |   | 16,460  |  
|Less: shares withheld for required minimum tax withholding                                                        |  |      |        |  |      |   | (10,063 | )
|                                                                                                                  |  |      |         |  |      |   |         |  
|Shares issued                                                                                                     |  |      |        |  |      |   | 6,397   |  
|                                                                                                                  |  |      |         |  |      |   |         |  

Stock Appreciation Rights

The SAR Plan is administered by the Compensation Committee of the Board of Directors of the Company and authorizes the Company to award SARs to eligible
persons. A SAR, as defined by the SAR Plan, is a right to receive a cash payment equal to the difference between the base price of the SAR and the market value of a common share of the Company on the date of exercise.    SARs can
be settled only in cash and expire no later than 10 years after the date of the grant. The award agreements provide that SARs granted to employees and executives will vest and may be exercisable 25% per year over four years. SARs granted to
directors, who are not officers of the Company, will vest and may be exercisable 25% on the grant date, and a further 25% will vest and may be exercisable per year over three years.

On February 3, 2016, the Board of Directors amended the SAR Plan by adding a provision that the base price of each SAR is confirmed in writing to the
participant at the time of grant and once so confirmed, may not be changed and, on March 18, 2016, further amended the SARs Plan by adding a provision that once the expiry date of SARs is determined in the applicable agreement, such expiry date
may not be extended.

All SARs are granted at a price determined and approved by the Board of Directors, which is the closing price of the common shares
of the Company on the TSX on the trading day immediately preceding the day on which a SAR is granted.

The total amount of expense recognized over the
life of the awards will equal the amount of the cash outflow, if any, as a result of exercises. At the end of each reporting period, the lifetime amount of expense recognized will equal the current period value of the SARs using the Black-Scholes
pricing model, multiplied by the percentage vested. As a result, the amount of expense recognized can vary due to changes in the model variables from period to period until the SARs are exercised, expire, or are otherwise cancelled.



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The following table summarizes information regarding SARs outstanding as of December 31:



|                                                                                                            |  |      |         |  |      |   |         | 
|----------------------------------------------------------------------------------------------------------- |  | ---- | ------- |  | ---- | - | ------- | 
|                                                                                                            |  | 2016 |         |  | 2015 |  
|SARs outstanding                                                                                            |  |      | 160,750 |  |      |   | 582,952 | 
|Weighted average fair value per SARs outstanding                                                            |  | $    | 12.37   |  |      | $ | 7.08    | 
|Outstanding amounts recorded in the consolidated balance sheets in accounts payable and accrued
liabilities |  | $    | 1,989   |  |      | $ | 4,014   | 
|Aggregate intrinsic value of outstanding vested awards                                                      |  | $    | 2,110   |  |      | $ | 2,857   | 

The weighted average fair value per SAR outstanding was estimated, using the Black-Scholes option pricing model, taking into
account the following weighted average assumptions as of December 31:



|                                |  |      |           |   |      |      |           |  
|------------------------------- |  | ---- | --------- | - | ---- | ---- | --------- | -
|                                |  | 2016 |           |   | 2015 |     
|Expected life                   |  |      | 1.5 years |   |      |      | 2.4 years |  
|Expected volatility(1)          |  |      | 35        | % |      |      | 35        | %
|Risk-free interest rate         |  |      | 0.74      | % |      |      | 0.59      | %
|Expected dividends              |  |      | 2.99      | % |      |      | 3.86      | %
|Stock price at grant date       |  | CDN$ | 7.56      |   |      | CDN$ | 7.56      |  
|Base price of awards            |  | CDN$ | 7.56      |   |      | CDN$ | 7.56      |  
|Stock price                     |  | CDN$ | 25.18     |   |      | CDN$ | 18.69     |  
|Foreign exchange rate US to CDN |  |      | 1.3426    |   |      |      | 1.3887    |  



|(1) | Expected volatility was calculated by applying a weighted average of the daily closing price change on the TSX for a term commensurate with the expected life of each
grant, with more weight placed on the more recent time periods.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The following table summarizes information regarding SARs activity for
three-year period ended December 31, 2016:



|                                                                                      |  |      |         |  |      |      |        |      |  |      |         | 
|------------------------------------------------------------------------------------- |  | ---- | ------- |  | ---- | ---- | ------ | ---- |  | ---- | ------- | 
|                                                                                      |  | 2016 |         |  | 2015 |      |        | 2014 | 
|SARs exercised                                                                        |  |      | 422,202 |  |      |      | 52,500 |      |  |      | 400,453 | 
|Base price                                                                            |  | CDN$ | 7.56    |  |      | CDN$ | 7.56   |      |  | CDN$ | 7.56    | 
|Cash payments on exercise                                                             |  | $    | 4,017   |  |      | $    | 462    |      |  | $    | 673     | 
|Amount accrued for exercised but not yet paid
(1)                                     |  | $    | 532     |  |      |      |       |      |  | $    | 2,958   | 
|SARs forfeited                                                                        |  |      |        |  |      |      | 10,000 |      |  |      | 123,750 | 
|Expense (income) recorded in earnings in selling, general and administrative expenses |  | $    | 2,521   |  |      | ($   | 216    | )    |  | $    | 3,699   | 



|(1) | Recorded in accounts payable and accrued liabilities in the consolidated balance sheets.
|--- | ----------------------------------------------------------------------------------------



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Change in Contributed Surplus

The activity for the three-year period ended December 31, 2016 in the consolidated changes in equity under the caption contributed surplus is detailed as
follows:



|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  
|------------------------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | ---- |  |  | ----- | -
|                                                                          |  | 2016 |        |   | 2015 |  |        | 2014 | 
|                                                                          |  | $    |        |   | $    |  |        | $    | 
|Change in excess tax benefit on exercised stock awards                    |  |      | (2,693 | ) |      |  | (2,088 | )    |  |  | (732  | )
|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  
|Change in excess tax benefit on outstanding stock awards                  |  |      | 4,302  |   |      |  | (1,502 | )    |  |  | 2,535 |  
|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  
|Share-based compensation expense credited to capital on options exercised |  |      | (595   | ) |      |  | (746   | )    |  |  | (289  | )
|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  
|Share-based compensation expense                                          |  |      |        |   |      |  |        |      |  |  |       |  
|Stock options                                                             |  |      | 427    |   |      |  | 931    |      |  |  | 1,542 |  
|DSUs                                                                      |  |      | 885    |   |      |  | 665    |      |  |  | 602   |  
|PSUs                                                                      |  |      | 3,961  |   |      |  | 1,763  |      |  |  | 338   |  
|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  
|                                                                          |  |      | 5,273  |   |      |  | 3,359  |      |  |  | 2,482 |  
|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  
|DSU settlement, net of required minimum tax withholding                   |  |      |       |   |      |  | (218   | )    |  |  |      |  
|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  
|Change in contributed surplus                                             |  |      | 6,287  |   |      |  | (1,195 | )    |  |  | 3,996 |  
|                                                                          |  |      |        |   |      |  |        |      |  |  |       |  

17 -BUSINESS ACQUISITIONS

Business acquisitions consisted of the following:



|                                         |  |                     |                    |  |                                             |  |     |                             |  |   |        | 
|---------------------------------------- |  | ------------------- | ------------------ |  | ------------------------------------------- |  | --- | --------------------------- |  | - | ------ | 
|                                         |  | Date of acquisition |                    |  | Proportion ofvoting equityinterest acquired |  |     | Netconsiderationtransferred | 
|2016                                     |  |                     |                    |  |                                             |  |     |                             |  |   |        | 
|Powerband Industries Private Limited     |  |                     | September 16, 2016 |  |                                             |  | 74  | %                           |  | $ | 41,855 | 
|                                         |  |                     |                   
|2015                                     |  |                     |                    |  |                                             |  |     |                             |  |   |        | 
|RJM Manufacturing, Inc. (d/b/a TaraTape) |  |                     | November 2, 2015   |  |                                             |  | 100 | %                           |  | $ | 11,000 | 
|Better Packages, Inc.                    |  |                     | April 7, 2015      |  |                                             |  | 100 | %                           |  | $ | 15,234 | 

Powerband Acquisition

On
September 16, 2016, the Company purchased 74% of the issued and outstanding shares in Powerband (the Powerband Acquisition), a global supplier of acrylic adhesive-based carton sealing tapes and stretch films located in Daman, India.
The remaining 26% will continue to be held by the Desai family who founded Powerband in 1994. The Powerband Acquisition is intended to further extend the Companys product offering and presence in the global packaging market.

TaraTape Acquisition

On November 2, 2015, the
Company purchased 100% of the issued and outstanding common shares and warrants of RJM Manufacturing, Inc. (d/b/a TaraTape) (the TaraTape Acquisition), a manufacturer of filament and pressure sensitive tapes. The TaraTape Acquisition was
to strengthen the Companys market position.

As part of its plan to realize operational synergies from the TaraTape acquisition completed in
November 2015, the Company set out a plan to close its Fairless Hills, Pennsylvania manufacturing facility and ceased production as of December 31, 2016. In order to accommodate the related production volume, the Company has leveraged
production capacity, and will continue to do so, in both its Carbondale, Illinois and Danville, Virginia manufacturing facilities. See Note 4 for more information.



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Better Packages Acquisition

On April 7, 2015, the Company purchased 100% of the issued and outstanding common shares of BP Acquisition Corporation (Better Packages)
(which wholly-owns a subsidiary, Better Packages, Inc.) (the Better Packages Acquisition), a supplier of water-activated tape dispensers. The Better Packages Acquisition was to further extend the Companys product offering and
global presence in the rapidly growing e-commerce market.

The net cash consideration paid on the closing date for
the acquisitions described above is as follows:



|                             |  |                      |        |  |                     |  |        |                            |  |  |        | 
|---------------------------- |  | -------------------- | ------ |  | ------------------- |  | ------ | -------------------------- |  |  | ------ | 
|                             |  | PowerbandAcquisition |        |  | TaraTapeAcquisition |  |        | Better PackagesAcquisition | 
|                             |  | $                    |        |  | $                   |  |        | $                          | 
|Consideration paid in cash   |  |                      | 41,856 |  |                     |  | 11,000 |                            |  |  | 15,768 | 
|Less: cash balances acquired |  |                      | 1      |  |                     |  |       |                            |  |  | 534    | 
|                             |  |                      |        |  |                     |  |        |                            |  |  |        | 
|                             |  |                      | 41,855 |  |                     |  | 11,000 |                            |  |  | 15,234 | 
|                             |  |                      |        |  |                     |  |        |                            |  |  |        | 

For the acquisitions described above, the fair value of net identifiable assets acquired at the date of acquisition is as
follows:



|                                               |  |                      |        |  |                     |  |        |                            |  |  |        | 
|---------------------------------------------- |  | -------------------- | ------ |  | ------------------- |  | ------ | -------------------------- |  |  | ------ | 
|                                               |  | PowerbandAcquisition |        |  | TaraTapeAcquisition |  |        | Better PackagesAcquisition | 
|                                               |  | $                    |        |  | $                   |  |        | $                          | 
|Current assets                                 |  |                      |        |  |                     |  |        |                            |  |  |        | 
|Cash                                           |  |                      | 1      |  |                     |  |       |                            |  |  | 534    | 
|Trade receivables (1)                          |  |                      | 1,265  |  |                     |  | 1,835  |                            |  |  | 1,310  | 
|Inventories                                    |  |                      | 1,797  |  |                     |  | 3,183  |                            |  |  | 2,489  | 
|Other current assets                           |  |                      | 436    |  |                     |  | 185    |                            |  |  | 100    | 
|Property, plant and equipment                  |  |                      | 9,650  |  |                     |  | 5,100  |                            |  |  | 632    | 
|Intangible assets                              |  |                      |        |  |                     |  |        |                            |  |  |        | 
|Customer list                                  |  |                      | 16,213 |  |                     |  | 2,095  |                            |  |  | 7,343  | 
|Trademark                                      |  |                      |       |  |                     |  | 494    |                            |  |  | 1,700  | 
|Non-compete agreement                          |  |                      | 7,822  |  |                     |  |       |                            |  |  | 198    | 
|Other intangibles                              |  |                      |       |  |                     |  |       |                            |  |  | 21     | 
|Other assets                                   |  |                      |       |  |                     |  | 304    |                            |  |  | 22     | 
|                                               |  |                      |        |  |                     |  |        |                            |  |  |        | 
|                                               |  |                      | 37,184 |  |                     |  | 13,196 |                            |  |  | 14,349 | 
|Current liabilities                            |  |                      |        |  |                     |  |        |                            |  |  |        | 
|Accounts payable and accrued liabilities       |  |                      | 1,054  |  |                     |  | 2,677  |                            |  |  | 1,165  | 
|Installments on long-term debt                 |  |                      | 1,244  |  |                     |  |       |                            |  |  |       | 
|Long-term debt                                 |  |                      | 107    |  |                     |  |       |                            |  |  |       | 
|Pension and other post-retirement benefits     |  |                      | 57     |  |                     |  |       |                            |  |  |       | 
|Deferred tax liabilities                       |  |                      | 9,734  |  |                     |  |       |                            |  |  | 3,483  | 
|Provisions                                     |  |                      |       |  |                     |  | 918    |                            |  |  | 10     | 
|                                               |  |                      |        |  |                     |  |        |                            |  |  |        | 
|                                               |  |                      | 12,196 |  |                     |  | 3,595  |                            |  |  | 4,658  | 
|                                               |  |                      |        |  |                     |  |        |                            |  |  |        | 
|Fair value of net identifiable assets acquired |  |                      | 24,988 |  |                     |  | 9,601  |                            |  |  | 9,691  | 
|                                               |  |                      |        |  |                     |  |        |                            |  |  |        | 



|(1) | As of December 31, 2016 the Company has collected the fair value of the Powerband Acquisition trade receivables of $1,265 which is equal to the gross contractual
amounts receivable. As of December 31, 2015 the Company has collected the fair value of the TaraTape trade receivables of $1,835 (gross contractual amount of $1,845) and the fair value of the Better Packages trade receivables of $1,310 (gross
contractual amount of $1,324).
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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For the acquisitions described above, the fair value of goodwill at the date of acquisition is as follows:



|                                                     |  |                      |        |  |                     |  |        |                            |  |  |        | 
|---------------------------------------------------- |  | -------------------- | ------ |  | ------------------- |  | ------ | -------------------------- |  |  | ------ | 
|                                                     |  | PowerbandAcquisition |        |  | TaraTapeAcquisition |  |        | Better PackagesAcquisition | 
|                                                     |  | $                    |        |  | $                   |  |        | $                          | 
|Cash consideration transferred                       |  |                      | 41,856 |  |                     |  | 11,000 |                            |  |  | 15,768 | 
|Plus: Remaining non-controlling interest             |  |                      | 6,497  |  |                     |  |       |                            |  |  |       | 
|Less: fair value of net identifiable assets acquired |  |                      | 24,988 |  |                     |  | 9,601  |                            |  |  | 9,691  | 
|                                                     |  |                      |        |  |                     |  |        |                            |  |  |        | 
|Goodwill                                             |  |                      | 23,365 |  |                     |  | 1,399  |                            |  |  | 6,077  | 
|                                                     |  |                      |        |  |                     |  |        |                            |  |  |        | 

Goodwill recognized is primarily related to growth expectations, expected future profitability, and expected cost synergies.
The Company expects the goodwill recognized as a result of the TaraTape Acquisition to be deductible for income tax purposes. The Company does not expect any of the goodwill recognized as a result of the Better Packages Acquisition and Powerband
Acquisition to be deductible for income tax purposes.

The acquisitions impact on the Companys consolidated earnings for the year of
acquisition is as follows:



|             |  |                                             |       |  |                                           |  |       |                                        |  |  |        | 
|------------ |  | ------------------------------------------- | ----- |  | ----------------------------------------- |  | ----- | -------------------------------------- |  |  | ------ | 
|             |  | Powerband Acquisition                       |       |  | TaraTape Acquisition                      |  |       | Better Packages Acquisition            | 
|             |  | September 16, 2016 throughDecember 31, 2016 |       |  | November 2, 2015 throughDecember 31, 2015 |  |       | April 7, 2015 throughDecember 31, 2015 | 
|             |  | $                                           |       |  | $                                         |  |       | $                                      | 
|Revenue      |  |                                             | 7,591 |  |                                           |  | 3,078 |                                        |  |  | 14,601 | 
|Net earnings |  |                                             | 65    |  |                                           |  | (161  | )                                      |  |  | 1,538  | 

Had the acquisitions been effective as of January 1 of the year of acquisition the impact on the Companys
consolidated earnings would have been as follows:



|                 |  |                       |        |  |                      |  |        |                             |  |  |        | 
|---------------- |  | --------------------- | ------ |  | -------------------- |  | ------ | --------------------------- |  |  | ------ | 
|                 |  | December 31,          |       
|                 |  | 2016                  |        |  | 2015                 |  |        | 2015                        | 
|                 |  | Powerband Acquisition |        |  | TaraTape Acquisition |  |        | Better Packages Acquisition | 
|                 |  | $                     |        |  | $                    |  |        | $                           | 
|Revenue          |  |                       | 27,663 |  |                      |  | 19,419 |                             |  |  | 18,193 | 
|Net earnings (1) |  |                       | 444    |  |                      |  | (102   | )                           |  |  | 1,598  | 



|(1) | The adjustments to arrive at net earnings included (i) the alignment of accounting policies to IFRS, (ii) the removal of acquisition costs incurred by the
acquiree, (iii) the amortization of recorded intangibles and other acquisition method accounting adjustments and (iv) the effect of income tax expense using the effective tax rate of the acquisition post-closing.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The acquisition-related costs of $1.3 million for the year ended December 31, 2016 and $0.9 million for the year ended December 31, 2015
are excluded from the consideration transferred and are included in the Companys consolidated earnings in selling, general and administrative expenses in the year of acquisition.

There were customary representations, warranties and covenants and indemnification provisions as part of the acquisitions described above. As of
December 31, 2016 there were no outstanding obligations or indemnifications related to these acquisitions.



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Non-controlling interest

The Company includes one subsidiary, Powerband, with material non-controlling interests:



|                                                                 |  |                  |       |  
|---------------------------------------------------------------- |  | ---------------- | ----- | -
|                                                                 |  | December 31,2016 |      
|                                                                 |  | $                |      
|Balance at the beginning                                         |  |                  |      |  
|Non-controlling interests arising from the Powerband
Acquisition |  |                  | 6,497 |  
|Share of comprehensive income for the period                     |  |                  | (90   | )
|                                                                 |  |                  |       |  
|Balance at end of year                                           |  |                  | 6,407 |  
|                                                                 |  |                  |       |  

18 -PENSION, POST-RETIREMENT AND OTHER LONG-TERM EMPLOYEE BENEFIT PLANS

The Company has several contributory and non-contributory defined contribution plans and defined benefit plans for
substantially all its employees in Canada and the US.

Defined contribution plans

In the US, the Company maintains a savings retirement plan (401(k) Plan) for the benefit of certain employees who have been employed for at least 90 days.
Contribution to this plan is at the discretion of the Company. The Company also maintains 401(k) plans according to the terms of certain collective bargaining agreements.

The Company also contributes to multi-employer plans for employees covered by certain collective bargaining agreements.

In Canada, the Company maintains defined contribution pension plans for its salaried employees and contributes amounts equal to 4% of each participants
eligible salary.

The amount expensed with respect to the defined contribution plans for the years ended December 31, was $4.6 million in 2016,
$4.0 in million 2015 and $3.6 million in 2014.

Defined benefit plans

The Company has, in the US, three defined benefit pension plans (hourly and salaried). Benefits for employees are based on compensation and years of service
for salaried employees and fixed benefits per month for each year of service for hourly employees.

In Canada, certain
non-union hourly employees of the Company are covered by a plan which provides a fixed benefit per month for each year of service.

Effective September 30, 2011, the only other defined benefit plan sponsored by the Company, associated with the former Brantford, Ontario manufacturing
facility was wound-up. Pursuant to applicable legislation, benefits for this plan had to be settled within the five-year period following the wind-up effective date.
During 2014, the Company purchased group annuity buy out policies to settle its obligation to plan participants. The Company recognized settlement losses in 2014 of $1.6 million resulting from the difference between the defined benefit
obligations remeasured at settlement dates and the cost to settle the obligations. The settlement losses were included in earnings in cost of sales.



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In the US, the Company provides group health care and life insurance benefits to certain retirees. In Canada, the
Company provides group health care, dental and life insurance benefits for eligible retired employees.

Supplementary executive retirement plans

The Company has Supplementary Executive Retirement Plans (SERPs) to provide supplemental pension benefits to certain key executives. The
SERPs are not funded and provide for an annual pension benefit, from retirement or termination date, in amounts ranging from $0.2 million to $0.6 million, annually.

Other long-term employee benefit plans

In the US, the
Company provides a deferred compensation plan to certain employees. Earnings and losses on the deferral and amounts due to the participants are payable based on participant elections. Assets are held in a rabbi trust and are composed of corporate
owned life insurance policies. Participant investment selections are used to direct the allocation of funds underlying the corporate owned life insurance policies. The deferred compensation plans assets and liabilities are presented in other assets
and other liabilities, respectively, in the consolidated balance sheets.

Governance and oversight

The defined benefit plans sponsored by the Company are subject to the requirements of the Employee Retirement Income Security Act and related legislation in
the US and the Canadian Income Tax Act and provincial legislation in Ontario and Nova Scotia. In addition, all actuarial computations related to defined benefit plans are based on actuarial assumptions and methods determined in accordance with the
generally recognized and accepted actuarial principles and practices prescribed by the Actuarial Standards Board, the American Academy of Actuaries and the Canadian Institute of Actuaries.

Minimum funding requirements are computed based on methodologies and assumptions dictated by regulation in the US and Canada. The Companys practice is
to fund at least the statutory minimum required amount for each defined benefit plans plan year.

The Companys
Investment Committee, composed of the Companys Chief Financial Officer, Vice President of Human Resources, Vice President of Treasury, Corporate Controller and General Counsel, makes investment decisions for the Companys pension plans.
The asset liability matching strategy of the pension plans and plan asset performance is reviewed semi-annually in terms of risk and return profiles with external investment management advisors, actuaries and plan trustees. The Investment Committee,
together with external investment management advisors, actuaries and plan trustees, has established a target mix of equity, fixed income, and alternative securities based on funded status level and other variables of each defined benefit plan.

The assets of the funded or partially funded defined benefit plans are held separately from those of the Company in funds under the control of trustees.



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##### Table of Contents

Information Relating to the Various Plans

A reconciliation of the defined benefit obligations and plan assets as of December 31 is presented in the table below:



|                                                                           |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|-------------------------------------------------------------------------- |  | ------------- | ------ | - | ----------- |  | ------ | ---- |  |  | ----- | - |  |  | ----- | -
|                                                                           |  | Pension Plans |        |   | Other plans | 
|                                                                           |  | 2016          |        |   | 2015        |  |        | 2016 |  |  | 2015  |  
|                                                                           |  | $             |        |   | $           |  |        | $    |  |  | $     |  
|Defined benefit obligations                                                |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|Balance, beginning of year                                                 |  |               | 76,172 |   |             |  | 81,223 |      |  |  | 3,365 |   |  |  | 3,662 |  
|Additions through business acquisitions                                    |  |               | 57     |   |             |  |       |      |  |  |      |   |  |  |      |  
|Current service cost                                                       |  |               | 1,176  |   |             |  | 1,208  |      |  |  | 22    |   |  |  | 22    |  
|Interest cost                                                              |  |               | 3,139  |   |             |  | 3,042  |      |  |  | 143   |   |  |  | 126   |  
|Benefits paid                                                              |  |               | (3,260 | ) |             |  | (3,211 | )    |  |  | (14   | ) |  |  | (27   | )
|Actuarial gains from demographic                                           |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|assumptions                                                                |  |               | (1,131 | ) |             |  | (1,332 | )    |  |  | (21   | ) |  |  | (30   | )
|Actuarial losses (gains) from                                              |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|financial assumptions                                                      |  |               | 1,901  |   |             |  | (2,652 | )    |  |  | 141   |   |  |  | (31   | )
|Experience losses (gains)                                                  |  |               | 1,383  |   |             |  | 15     |      |  |  | (835  | ) |  |  | 22    |  
|Foreign exchange rate adjustment                                           |  |               | 384    |   |             |  | (2,121 | )    |  |  | 66    |   |  |  | (379  | )
|                                                                           |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|Balance, end of year                                                       |  |               | 79,821 |   |             |  | 76,172 |      |  |  | 2,867 |   |  |  | 3,365 |  
|                                                                           |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|Fair value of plan assets                                                  |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|Balance, beginning of year                                                 |  |               | 50,245 |   |             |  | 53,172 |      |  |  |      |   |  |  |      |  
|Interest income                                                            |  |               | 1,965  |   |             |  | 1,955  |      |  |  |      |   |  |  |      |  
|Return on plan assets (excluding amounts included in net interest expense) |  |               | 1,705  |   |             |  | (1,458 | )    |  |  |      |   |  |  |      |  
|Contributions by the employer                                              |  |               | 1,357  |   |             |  | 1,930  |      |  |  |      |   |  |  |      |  
|Benefits paid                                                              |  |               | (3,260 | ) |             |  | (3,211 | )    |  |  |      |   |  |  |      |  
|Administration expenses                                                    |  |               | (487   | ) |             |  | (307   | )    |  |  |      |   |  |  |      |  
|Foreign exchange rate adjustment                                           |  |               | 331    |   |             |  | (1,836 | )    |  |  |      |   |  |  |      |  
|                                                                           |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|Balance, end of year                                                       |  |               | 51,856 |   |             |  | 50,245 |      |  |  |      |   |  |  |      |  
|                                                                           |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  
|Funded status  deficit                                                    |  |               | 27,965 |   |             |  | 25,927 |      |  |  | 2,867 |   |  |  | 3,365 |  
|                                                                           |  |               |        |   |             |  |        |      |  |  |       |   |  |  |       |  



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##### Table of Contents

The defined benefit obligations and fair value of plan assets as of December 31 are broken down by
geographical locations as follows:



|                            |  |      |         |   |        |  |         |       |  |  |         |  
|--------------------------- |  | ---- | ------- | - | ------ |  | ------- | ----- |  |  | ------- | -
|                            |  | 2016 |        
|                            |  | US   |         |   | Canada |  |         | Total | 
|                            |  | $    |         |   | $      |  |         | $     | 
|Defined benefit obligations |  |      | 68,584  |   |        |  | 14,104  |       |  |  | 82,688  |  
|Fair value of plan assets   |  |      | (40,521 | ) |        |  | (11,335 | )     |  |  | (51,856 | )
|                            |  |      |         |   |        |  |         |       |  |  |         |  
|Deficit in plans            |  |      | 28,063  |   |        |  | 2,769   |       |  |  | 30,832  |  
|                            |  |      |         |   |        |  |         |       |  |  |         |  
|                            | 
|                            |  | 2015 |        
|                            |  | US   |         |   | Canada |  |         | Total | 
|                            |  | $    |         |   | $      |  |         | $     | 
|Defined benefit obligations |  |      | 66,728  |   |        |  | 12,809  |       |  |  | 79,537  |  
|Fair value of plan assets   |  |      | (40,338 | ) |        |  | (9,907  | )     |  |  | (50,245 | )
|                            |  |      |         |   |        |  |         |       |  |  |         |  
|Deficit in plans            |  |      | 26,390  |   |        |  | 2,902   |       |  |  | 29,292  |  
|                            |  |      |         |   |        |  |         |       |  |  |         |  

The defined benefit obligations for pension plans as of December 31 broken down by funding status are as follows:



|                                  |  |      |        |  |      |  |        | 
|--------------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|                                  |  | 2016 |        |  | 2015 | 
|                                  |  | $    |        |  | $    | 
|Wholly unfunded                   |  |      | 11,050 |  |      |  | 10,952 | 
|Wholly funded or partially funded |  |      | 68,771 |  |      |  | 65,220 | 
|                                  |  |      |        |  |      |  |        | 
|Total obligations                 |  |      | 79,821 |  |      |  | 76,172 | 
|                                  |  |      |        |  |      |  |        | 

A reconciliation of pension and other post-retirement benefits recognized in the consolidated balance sheets as of
December 31 is presented in the table below:



|                                                                              |  |                  |        |  |                  |  |        | 
|----------------------------------------------------------------------------- |  | ---------------- | ------ |  | ---------------- |  | ------ | 
|                                                                              |  | December 31,2016 |        |  | December 31,2015 | 
|                                                                              |  | $                |        |  | $                | 
|Pension Plans                                                                 |  |                  |        |  |                  |  |        | 
|Present value of the defined benefit obligation                               |  |                  | 79,821 |  |                  |  | 76,172 | 
|Fair value of the plan assets                                                 |  |                  | 51,856 |  |                  |  | 50,245 | 
|                                                                              |  |                  |        |  |                  |  |        | 
|Deficit in plans                                                              |  |                  | 27,965 |  |                  |  | 25,927 | 
|                                                                              |  |                  |        |  |                  |  |        | 
|Liabilities recognized                                                        |  |                  | 27,965 |  |                  |  | 25,927 | 
|                                                                              |  |                  |        |  |                  |  |        | 
|Other plans                                                                   |  |                  |        |  |                  |  |        | 
|Present value of the defined benefit obligation and deficit in the plans      |  |                  | 2,867  |  |                  |  | 3,365  | 
|                                                                              |  |                  |        |  |                  |  |        | 
|Liabilities recognized                                                        |  |                  | 2,867  |  |                  |  | 3,365  | 
|                                                                              |  |                  |        |  |                  |  |        | 
|Total plans                                                                   |  |                  |        |  |                  |  |        | 
|Total pension and other post-retirement benefits recognized in balance sheets |  |                  | 30,832 |  |                  |  | 29,292 | 
|                                                                              |  |                  |        |  |                  |  |        | 



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The composition of plan assets based on the fair value as of December 31 was as follows:



|                              |  |                  |        |  |                  |  |        | 
|----------------------------- |  | ---------------- | ------ |  | ---------------- |  | ------ | 
|                              |  | December 31,2016 |        |  | December 31,2015 | 
|                              |  | $                |        |  | $                | 
|Asset category                |  |                  |        |  |                  |  |        | 
|Cash                          |  |                  | 1,230  |  |                  |  | 860    | 
|Equity instruments            |  |                  | 29,645 |  |                  |  | 29,399 | 
|Fixed income instruments      |  |                  | 19,180 |  |                  |  | 16,900 | 
|Real estate investment trusts |  |                  | 1,801  |  |                  |  | 3,053  | 
|Other                         |  |                  |       |  |                  |  | 33     | 
|                              |  |                  |        |  |                  |  |        | 
|Total                         |  |                  | 51,856 |  |                  |  | 50,245 | 
|                              |  |                  |        |  |                  |  |        | 

As of December 31, 2016 and 2015, approximately 75% and 72% of equity and fixed income instruments were held in mutual
funds or exchange traded funds, respectively. None of the benefit plan assets were invested in any of the Companys own equity or financial instruments or in any property or other asset that was used by the Company.

Most equity, fixed income and real estate investment trusts have quoted prices, or net asset value, in active markets. Certain US government obligations and
mutual fund positions are valued at the quoted price, or net asset value, for identical or similar securities reported in active markets.

The defined
benefit expenses recognized in consolidated earnings during the years ended December 31 are presented in the table below:



|                                                               |  |               |       |  |             |  |       |      |  |  |       |  |  |      |     |  |      |  |     |  |  |  |     | 
|-------------------------------------------------------------- |  | ------------- | ----- |  | ----------- |  | ----- | ---- |  |  | ----- |  |  | ---- | --- |  | ---- |  | --- |  |  |  | --- | 
|                                                               |  | Pension Plans |       |  | Other plans | 
|                                                               |  | 2016          |       |  | 2015        |  |       | 2014 |  |  | 2016  |  |  | 2015 |     |  | 2014 | 
|                                                               |  | $             |       |  | $           |  |       | $    |  |  | $     |  |  | $    |     |  | $    | 
|Current service cost                                           |  |               | 1,176 |  |             |  | 1,208 |      |  |  | 1,126 |  |  |      | 22  |  |      |  | 22  |  |  |  | 16  | 
|Administration expenses                                        |  |               | 487   |  |             |  | 307   |      |  |  | 675   |  |  |      |    |  |      |  |    |  |  |  |    | 
|Net interest expense                                           |  |               | 1,174 |  |             |  | 1,087 |      |  |  | 1,031 |  |  |      | 143 |  |      |  | 126 |  |  |  | 136 | 
|Settlement loss                                                |  |               |      |  |             |  |      |      |  |  | 1,613 |  |  |      |    |  |      |  |    |  |  |  |    | 
|                                                               |  |               |       |  |             |  |       |      |  |  |       |  |  |      |     |  |      |  |     |  |  |  |     | 
|Net costs recognized in the statement of consolidated earnings |  |               | 2,837 |  |             |  | 2,602 |      |  |  | 4,445 |  |  |      | 165 |  |      |  | 148 |  |  |  | 152 | 
|                                                               |  |               |       |  |             |  |       |      |  |  |       |  |  |      |     |  |      |  |     |  |  |  |     | 



|                                                               |  |             |       |  |      |  |       |      |  |  |       | 
|-------------------------------------------------------------- |  | ----------- | ----- |  | ---- |  | ----- | ---- |  |  | ----- | 
|                                                               |  | Total Plans |      
|                                                               |  | 2016        |       |  | 2015 |  |       | 2014 | 
|                                                               |  | $           |       |  | $    |  |       | $    | 
|Current service cost                                           |  |             | 1,198 |  |      |  | 1,230 |      |  |  | 1,142 | 
|Administration expenses                                        |  |             | 487   |  |      |  | 307   |      |  |  | 675   | 
|Net interest expense                                           |  |             | 1,317 |  |      |  | 1,213 |      |  |  | 1,167 | 
|Settlement loss                                                |  |             |      |  |      |  |      |      |  |  | 1,613 | 
|                                                               |  |             |       |  |      |  |       |      |  |  |       | 
|Net costs recognized in the statement of consolidated earnings |  |             | 3,002 |  |      |  | 2,750 |      |  |  | 4,597 | 
|                                                               |  |             |       |  |      |  |       |      |  |  |       | 



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##### Table of Contents

The defined benefit liability remeasurement recognized in OCI during the years ended December 31 is
presented in the table below:



|                                                                                          |  |               |        |   |             |  |        |      |  |  |         |   |  |      |      |   |      |  |     |   |  |  |      |  
|----------------------------------------------------------------------------------------- |  | ------------- | ------ | - | ----------- |  | ------ | ---- |  |  | ------- | - |  | ---- | ---- | - | ---- |  | --- | - |  |  | ---- | -
|                                                                                          |  | Pension Plans |        |   | Other plans | 
|                                                                                          |  | 2016          |        |   | 2015        |  |        | 2014 |  |  | 2016    |   |  | 2015 |      |   | 2014 | 
|                                                                                          |  | $             |        |   | $           |  |        | $    |  |  | $       |   |  | $    |      |   | $    | 
|Actuarial gains (losses) from demographic assumptions                                     |  |               | 1,131  |   |             |  | 1,332  |      |  |  | (3,726  | ) |  |      | 21   |   |      |  | 30  |   |  |  | (87  | )
|Actuarial (losses) gains from financial assumptions                                       |  |               | (1,901 | ) |             |  | 2,652  |      |  |  | (10,311 | ) |  |      | (141 | ) |      |  | 31  |   |  |  | (209 | )
|Experience (losses) gains                                                                 |  |               | (1,383 | ) |             |  | (15    | )    |  |  | 1,277   |   |  |      | 835  |   |      |  | (22 | ) |  |  | (185 | )
|Return on plan assets (excluding amounts included in net interest expense)                |  |               | 1,705  |   |             |  | (1,458 | )    |  |  | 2,538   |   |  |      |     |   |      |  |    |   |  |  |     |  
|Change in the amount recognized as a liability in respect of minimum funding requirements |  |               |       |   |             |  |       |      |  |  | 2,497   |   |  |      |     |   |      |  |    |   |  |  |     |  
|                                                                                          |  |               |        |   |             |  |        |      |  |  |         |   |  |      |      |   |      |  |     |   |  |  |      |  
|Total amounts recognized in OCI                                                           |  |               | (448   | ) |             |  | 2,511  |      |  |  | (7,725  | ) |  |      | 715  |   |      |  | 39  |   |  |  | (481 | )
|                                                                                          |  |               |        |   |             |  |        |      |  |  |         |   |  |      |      |   |      |  |     |   |  |  |      |  

The Company expects to contribute $4.0 million to its defined benefit pension plans and $0.1 million to its health
and welfare plans in 2017.

The weighted average duration of the defined benefit obligation as of December 31, 2016 is 13 years (14 years as of
December 31, 2015) for US plans and 20 years for Canadian plans for both periods.

The significant weighted average assumptions which were used to
measure its defined benefit obligations as of December 31 are as follows:



|                                |  |          |      |   |                |  |      |      |  |  |      |   |  |  |      |  
|------------------------------- |  | -------- | ---- | - | -------------- |  | ---- | ---- |  |  | ---- | - |  |  | ---- | -
|                                |  | US plans |      |   | Canadian plans | 
|                                |  | 2016     |      |   | 2015           |  |      | 2016 |  |  | 2015 |  
|Discount rate                   |  |          |      |   |                |  |      |      |  |  |      |   |  |  |      |  
|Pension plans                   |  |          | 3.88 | % |                |  | 4.03 | %    |  |  | 4.00 | % |  |  | 4.25 | %
|Other plans                     |  |          | 3.47 | % |                |  | 3.28 | %    |  |  | 4.00 | % |  |  | 4.25 | %
|Mortality rate (in years)       |  |          |      |   |                |  |      |      |  |  |      |   |  |  |      |  
|Current pensioner - Male        |  |          | 20   |   |                |  | 21   |      |  |  | 22   |   |  |  | 22   |  
|Current pensioner - Female      |  |          | 22   |   |                |  | 23   |      |  |  | 24   |   |  |  | 24   |  
|Current member aged 45 - Male   |  |          | 21   |   |                |  | 22   |      |  |  | 23   |   |  |  | 23   |  
|Current member aged 45 - Female |  |          | 24   |   |                |  | 24   |      |  |  | 25   |   |  |  | 25   |  

These assumptions are developed by management with the assistance of independent actuaries. Discount rates are determined
close to each year-end by reference to market yields of high quality corporate bonds that are denominated in the currency in which the benefits will be paid and have terms to maturity approximating the terms
of the related pension benefit obligation. Other assumptions are based on current actuarial benchmarks and managements historical experience.

Significant actuarial assumptions for defined benefit obligation measurement purposes are discount rate and mortality rate. The sensitivity analyses below
have been determined based on reasonably possible changes of the assumptions, in isolation from one another, occurring at the end of the reporting period. This analysis may not be representative of the actual change in the defined benefit obligation
as it is unlikely that the change in the assumptions would occur in isolation from one another as some of the assumptions may be correlated. An increase or decrease of 1% in the discount rate or an increase or decrease of one year in mortality rate
would result in the following increase (decrease) in the defined benefit obligation:



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##### Table of Contents

|                                      |  |      |         |   |      |  |        |  
|------------------------------------- |  | ---- | ------- | - | ---- |  | ------ | -
|                                      |  | 2016 |         |   | 2015 | 
|                                      |  | $    |         |   | $    | 
|Discount rate                         |  |      |         |   |      |  |        |  
|Increase of 1%                        |  |      | (10,085 | ) |      |  | (9,883 | )
|Decrease of 1%                        |  |      | 12,535  |   |      |  | 12,337 |  
|Mortality rate                        |  |      |         |   |      |  |        |  
|Life expectancy increased by one year |  |      | 2,672   |   |      |  | 2,546  |  
|Life expectancy decreased by one year |  |      | (2,688  | ) |      |  | (2,494 | )

19- SEGMENT DISCLOSURES

The Company operates in various geographic locations and develops, manufactures and sells a variety of products to a diverse customer base. Most of the
Companys products are made from similar processes. A vast majority of the Companys products, while brought to market through various distribution channels, generally have similar economic characteristics. The Companys decisions
about resources to be allocated are determined as a whole based on the Companys operational, management and reporting structure. The chief operating decision maker assesses the Companys performance as a single operating segment.

Geographic Information

The following tables present
geographic information about revenue attributed to countries based on the location of external customers and about long-lived asset by country based on the location of the assets:



|              |  |      |         |  |      |  |         |      |  |  |         | 
|------------- |  | ---- | ------- |  | ---- |  | ------- | ---- |  |  | ------- | 
|              |  | 2016 |         |  | 2015 |  |         | 2014 | 
|              |  | $    |         |  | $    |  |         | $    | 
|Revenue       |  |      |         |  |      |  |         |      |  |  |         | 
|Canada        |  |      | 54,574  |  |      |  | 53,035  |      |  |  | 61,903  | 
|United States |  |      | 670,619 |  |      |  | 671,187 |      |  |  | 670,997 | 
|Other         |  |      | 83,608  |  |      |  | 57,685  |      |  |  | 79,832  | 
|              |  |      |         |  |      |  |         |      |  |  |         | 
|Total revenue |  |      | 808,801 |  |      |  | 781,907 |      |  |  | 812,732 | 
|              |  |      |         |  |      |  |         |      |  |  |         | 



|                                    |  |                  |         |  |                  |  |         | 
|----------------------------------- |  | ---------------- | ------- |  | ---------------- |  | ------- | 
|                                    |  |                 
|                                    |  | December 31,2016 |         |  | December 31,2015 | 
|                                    |  | $                |         |  | $                | 
|Property, plant and equipment       |  |                  |         |  |                  |  |         | 
|Canada                              |  |                  | 14,163  |  |                  |  | 14,467  | 
|India                               |  |                  | 10,858  |  |                  |  |        | 
|United States                       |  |                  | 192,805 |  |                  |  | 172,756 | 
|Portugal                            |  |                  | 15,652  |  |                  |  | 10,862  | 
|                                    |  |                  |         |  |                  |  |         | 
|Total property, plant and equipment |  |                  | 233,478 |  |                  |  | 198,085 | 
|                                    |  |                  |         |  |                  |  |         | 
|Goodwill                            |  |                  |         |  |                  |  |         | 
|India                               |  |                  | 23,365  |  |                  |  |        | 
|United States                       |  |                  | 7,476   |  |                  |  | 7,476   | 
|                                    |  |                  |         |  |                  |  |         | 
|Total goodwill                      |  |                  | 30,841  |  |                  |  | 7,476   | 
|                                    |  |                  |         |  |                  |  |         | 
|Intangible assets                   |  |                  |         |  |                  |  |         | 
|India                               |  |                  | 22,965  |  |                  |  |        | 
|United States                       |  |                  | 11,059  |  |                  |  | 12,518  | 
|Other                               |  |                  | 26      |  |                  |  | 50      | 
|                                    |  |                  |         |  |                  |  |         | 
|Total intangible assets             |  |                  | 34,050  |  |                  |  | 12,568  | 
|                                    |  |                  |         |  |                  |  |         | 
|Other assets                        |  |                  |         |  |                  |  |         | 
|United States                       |  |                  | 3,281   |  |                  |  | 3,082   | 
|Other                               |  |                  | 99      |  |                  |  | 96      | 
|                                    |  |                  |         |  |                  |  |         | 
|Total other assets                  |  |                  | 3,380   |  |                  |  | 3,178   | 
|                                    |  |                  |         |  |                  |  |         | 



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##### Table of Contents

The following table presents revenue information based on revenues for the following product categories and their
complementary packaging systems:



|                     |  |      |         |  |      |  |         |      |  |  |         | 
|-------------------- |  | ---- | ------- |  | ---- |  | ------- | ---- |  |  | ------- | 
|                     |  | 2016 |         |  | 2015 |  |         | 2014 | 
|                     |  | $    |         |  | $    |  |         | $    | 
|Revenue              |  |      |         |  |      |  |         |      |  |  |         | 
|Tape                 |  |      | 538,525 |  |      |  | 529,524 |      |  |  | 524,979 | 
|Film                 |  |      | 154,145 |  |      |  | 128,361 |      |  |  | 158,398 | 
|Woven coated fabrics |  |      | 106,720 |  |      |  | 117,881 |      |  |  | 121,431 | 
|Other                |  |      | 9,411   |  |      |  | 6,141   |      |  |  | 7,924   | 
|                     |  |      |         |  |      |  |         |      |  |  |         | 
|                     |  |      | 808,801 |  |      |  | 781,907 |      |  |  | 812,732 | 
|                     |  |      |         |  |      |  |         |      |  |  |         | 

20 -RELATED PARTY TRANSACTIONS

The Companys key personnel are all members of the Board of Directors and five members of senior management in 2016, 2015 and 2014. Key personnel
remuneration includes the following expenses:



|                                                                                                     |  |      |        |  |      |  |       |      |  |  |       | 
|---------------------------------------------------------------------------------------------------- |  | ---- | ------ |  | ---- |  | ----- | ---- |  |  | ----- | 
|                                                                                                     |  | 2016 |        |  | 2015 |  |       | 2014 | 
|                                                                                                     |  | $    |        |  | $    |  |       | $    | 
|Short-term benefits including employee salaries and bonuses and director retainer and committee
fees |  |      | 4,842  |  |      |  | 3,378 |      |  |  | 3,359 | 
|Post-employment benefits                                                                             |  |      | 305    |  |      |  | 311   |      |  |  | 300   | 
|Share-based compensation expense                                                                     |  |      | 5,195  |  |      |  | 2,121 |      |  |  | 4,806 | 
|Termination benefits(1)                                                                              |  |      |       |  |      |  | (405  | )    |  |  | 405   | 
|                                                                                                     |  |      |        |  |      |  |       |      |  |  |       | 
|Total remuneration                                                                                   |  |      | 10,342 |  |      |  | 5,405 |      |  |  | 8,870 | 
|                                                                                                     |  |      |        |  |      |  |       |      |  |  |       | 



|(1) | Refer to Note 14 for more information regarding termination benefits.
|--- | ---------------------------------------------------------------------

In June 2014, the Company engaged with
a relocation management company to facilitate the purchase of the then-newly appointed CFOs home in Montreal, Québec, Canada to assist in the relocation to Sarasota, FL, U.S.A. The Company provided funding to the relocation management
company to purchase the home for $0.9 million. The sale of the home was completed on April 15, 2015 and the Company was reimbursed for the purchase funding.

21 -COMMITMENTS

Commitments
Under Operating Leases

For the year ended December 31, 2016, the expense in respect of operating leases was $5.9 million ($5.9 million
in 2015 and $5.2 million in 2014). As of December 31, 2016, the Company had commitments aggregating to approximately $13.3 million through the year 2024 for the rental of offices, warehouse space, manufacturing equipment, automobiles,
computer hardware and other assets. Minimum lease payments for the next five years are expected to be $4.0 million in 2017, $3.4 million in 2018, $1.9 million in 2019, $1.2 million in 2020, $0.8 million in 2021 and
$2.0 million thereafter.



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Commitments Under Service Contracts

The Company entered into a five-year electricity service contract for one of its manufacturing facilities on May 1, 2016, under which the Company expects
to reduce the overall cost of electricity consumed by the facility. In the event of early termination, the Company is required to pay for unrecovered power supply costs incurred by the supplier which are estimated to be approximately
$11.7 million as of December 31, 2016, and would decline monthly based on actual service billings to date.

The Company entered into a ten-year electricity service contract for one of its manufacturing facilities on November 12, 2013. The service date of the contract commenced in August 2014. The Company is committed to monthly minimum usage
requirements over the term of the contract. The Company was provided installation at no cost and is receiving economic development incentive credits and maintenance of the required energy infrastructure at the manufacturing facility as part of the
contract. The credits are expected to reduce the overall cost of electricity consumed by the facility over the term of the contract. Effective August 1, 2015, the Company entered into an amendment lowering the minimum usage requirements over
the term of the contract. In addition, a new monthly facility charge will be incurred by the Company over the term of the contract. The Company estimates that service billings will total approximately $1.7 million annually in 2017 through 2021
and $4.4 million as the total billings expected over the remainder of the contract up to 2023.

Certain penalty clauses exist within the electricity
service contract related to early cancellation after the service date of the contract. The costs related to early cancellation penalties include termination fees based on anticipated service billings over the term of the contract and capital expense
recovery charges. While the Company does not expect to cancel the contract prior to the end of its term, the penalties that would apply to early cancellation could total as much as $4.8 million as of December 31, 2016. This amount declines
annually until the expiration of the contract.

The Company has entered into agreements with various utility suppliers to fix certain energy costs,
including natural gas and electricity, through December 2020 for minimum amounts of consumption at several of its manufacturing facilities. The Company estimates that utility billings will total approximately $5.1 million over the term of the
contracts based on the contracted fixed terms and current market rate assumptions. The Company is also required by the agreements to pay any difference between the fixed price agreed to with the utility and the sales amount received by the utility
for resale to a third party if the Company fails to meet the minimum consumption required by the agreements. In the event of early termination, the Company is required to pay the utility suppliers the difference between the contracted amount and the
current market value of the energy, adjusted for present value, of any future agreed upon minimum usage. Neither party will be liable for failure to perform for reasons of force majeure as defined in the agreements.

Commitments to Suppliers

The Company obtains certain raw
materials from suppliers under consignment agreements. The suppliers retain ownership of raw materials until the earlier of when the materials are consumed in production or auto billings are triggered based upon maturity. The consignment agreements
involve short-term commitments that typically mature within 30 to 60 days of inventory receipt and are typically renewed on an ongoing basis. The Company may be subject to fees in the event the Company requires storage in excess of 30 to 60 days. As
of December 31, 2016, the Company had on hand $8.7 million of raw material owned by its suppliers.

The Company has entered into agreements with
various raw material suppliers to purchase minimum quantities of certain raw materials at fixed rates through October 2017 totalling approximately $10.8 million as of December 31, 2016. The Company is also required by the agreements to pay
any storage costs incurred by the applicable supplier in the event the Company delays shipment in excess of 30 days. In the event the Company defaults under the terms of an agreement, an arbitrator will determine fees and penalties due to the
applicable supplier. Neither party will be liable for failure to perform for reasons of force majeure as defined in the agreements.



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The Company currently knows of no event, trend or uncertainty that may affect the availability or benefits of
these arrangements.

22 -FINANCIAL INSTRUMENTS

Classification and Fair Value of Financial Instruments

As
of December 31, 2016 and 2015, the classification of financial instruments, as well as their carrying amounts are as follows:



|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|-------------------------------------------- |  | -------------- | ------- |  | ------------------------- |  | ------ | --------------------------------------- |  |  | --- | 
|                                             |  | Amortized cost |         |  | Fair valuethroughearnings |  |        | Derivatives usedfor hedging (fairvalue) | 
|                                             |  | $              |         |  | $                         |  |        | $                                       | 
|December 31, 2016                            |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Financial assets                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Cash                                         |  |                | 20,956  |  |                           |  |       |                                         |  |  |    | 
|Trade receivables                            |  |                | 90,122  |  |                           |  |       |                                         |  |  |    | 
|Supplier rebates and other receivables       |  |                | 2,154   |  |                           |  |       |                                         |  |  |    | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Total                                        |  |                | 113,232 |  |                           |  |       |                                         |  |  |    | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Financial liabilities                        |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Accounts payable and accrued liabilities
(1) |  |                | 78,248  |  |                           |  |       |                                         |  |  |    | 
|Borrowings (2)                               |  |                | 165,560 |  |                           |  |       |                                         |  |  |    | 
|Non-controlling interest put options         |  |                |        |  |                           |  | 10,020 |                                         |  |  |    | 
|Interest rate swap agreements                |  |                |        |  |                           |  |       |                                         |  |  | 219 | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Total                                        |  |                | 243,808 |  |                           |  | 10,020 |                                         |  |  | 219 | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|December 31, 2015                            |  |                |         |  |                           |  |        |                                         |  |  |     | 
|                                             |  |                |        
|Financial assets                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Cash                                         |  |                | 17,615  |  |                           |  |       |                                         |  |  |    | 
|Trade receivables                            |  |                | 78,517  |  |                           |  |       |                                         |  |  |    | 
|Supplier rebates and other receivables       |  |                | 1,135   |  |                           |  |       |                                         |  |  |    | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Total                                        |  |                | 97,267  |  |                           |  |       |                                         |  |  |    | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Financial liabilities                        |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Accounts payable and accrued liabilities
(1) |  |                | 64,484  |  |                           |  |       |                                         |  |  |    | 
|Borrowings (2)                               |  |                | 132,865 |  |                           |  |       |                                         |  |  |    | 
|Interest rate swap agreements                |  |                |        |  |                           |  |       |                                         |  |  | 438 | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 
|Total                                        |  |                | 197,349 |  |                           |  |       |                                         |  |  | 438 | 
|                                             |  |                |         |  |                           |  |        |                                         |  |  |     | 



|(1) | Excludes employee benefits
|--- | --------------------------

|(2) | Excludes finance lease liabilities
|--- | ----------------------------------

The carrying amount
of the financial assets and liabilities classified as measured at amortized cost is considered a reasonable approximation of fair value. The fair value of cash, trade receivables, supplier rebates and other receivables, accounts payable and accrued
liabilities is comparable to their carrying amount, given their short maturity periods. The fair value of long-term borrowings, mainly bearing interest at variable rates, is estimated using observable market interest rates of similar variable rate
loans with similar risk and credit standing.



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The methods used to measure financial assets and liabilities at fair value are described below.

Hierarchy of financial instruments

The Company
categorizes its financial instruments into a three-level fair value measurement hierarchy as follows:

Level 1: The fair value is
determined directly by reference to unadjusted quoted prices in active markets for identical assets and liabilities.

Level 2: The
fair value is estimated using a valuation technique based on observable market data, either directly or indirectly.

Level 3: The fair
value is estimated using a valuation technique based on unobservable data.

The Company ensures, to the extent possible, that its valuation techniques and
assumptions incorporate all factors that market participants would consider in setting a price and that it is consistent with accepted economic methods for pricing financial instruments. There were no transfers between Level 1 and Level 2
in 2016 or 2015.

As of December 31, 2016 and 2015, long-term borrowings and interest rate swaps are categorized as Level 2 of the fair value
hierarchy. The Company measures the fair value of its interest rate swap agreements using discounted cash flows. Future cash flows are estimated based on forward interest rates (from observable yield curves at the end of a reporting period) and
contract interest rates, discounted as a rate that reflects the credit risk of various counterparties.

As of December 31, 2016, the Company
categorizes its non-controlling interest put options as Level 3 of the fair value hierarchy. The Company measures the fair value of its non-controlling interest put
options by estimating the present value of future net cash inflows from earnings associated with the proportionate shares that are subject to sale to the Company pursuant to an exercise event. This estimation is intended to approximate the
redemption value of the options as indicated in the shareholders agreement. The calculation is made using significant unobservable inputs including estimations of undiscounted annual future cash inflows ranging between $4.5 million and
$7.5 million, and a discount rate of 12.7%, which the Company believes to be commensurate with the risks inherent in the ownership interest. The fair value of the liability is sensitive to changes in projected earnings and thereby, future cash
inflows, and the discount rate applied to those future cash inflows, which could result in a higher or lower fair value measurement.

The reconciliation
of the carrying amount of financial instruments classified within Level 3 is as follows:



|                                                                              |  |                  |        |  
|----------------------------------------------------------------------------- |  | ---------------- | ------ | -
|                                                                              |  | December 31,2016 |       
|                                                                              |  | $                |       
|Balance at the beginning of the year                                          |  |                  |       |  
|Non-controlling interest put options resulting from the
Powerband Acquisition |  |                  | 10,181 |  
|Net foreign exchange differences                                              |  |                  | (161   | )
|                                                                              |  |                  |        |  
|Balance at end of the year                                                    |  |                  | 10,020 |  
|                                                                              |  |                  |        |  

In addition to the put options described above, the Company has entered into various other option agreements with the non-controlling interest shareholders for the transfer of Powerband shares under certain limited circumstances. Under the terms of a shareholders agreement and upon the occurrence of certain triggering events
such as counterparty default, a shareholder deadlock or business exit, each party



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has the option to buy the counterpartys shares at the same variable price as the written put options, with the Company having the first right of refusal. In the event of default by the
Company, the non-controlling interest shareholders also have the option to sell their shares to the Company at the same variable price. These options are not separately accounted for within the balance sheet
as they are determined to have zero fair market value to the Company.

Refer to Note 17 for more information regarding business acquisitions. Refer to
Note 15 for more information regarding the valuation of the associated financial liabilities.

Income and expenses relating to financial assets and
financial liabilities are as follows:



|                                                                                |  |      |       |  |      |  |       |      |  |  |       | 
|------------------------------------------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | ---- |  |  | ----- | 
|                                                                                |  | 2016 |       |  | 2015 |  |       | 2014 | 
|                                                                                |  | $    |       |  | $    |  |       | $    | 
|Interest expense calculated using the effective interest rate method Borrowings |  |      | 4,542 |  |      |  | 3,380 |      |  |  | 5,756 | 

Exchange Risk

The
Companys consolidated financial statements are expressed in US dollars while a portion of its business is conducted in other currencies. Changes in the exchange rates for such currencies into US dollars can increase or decrease revenues,
operating profit, earnings and the carrying values of assets and liabilities.

The following table details the Companys sensitivity to a 10%
strengthening of other currencies against the US dollar, and the related impact on finance costsother expense, net. For a 10% weakening of the other currencies against the US dollar, there would be an equal and opposite impact on finance
costsother expense, net. As of December 31, 2016 and 2015 everything else being equal, a 10% strengthening of other currencies against the US dollar, would result as follows:



|                                                                                                          |  |                |     |  |      |  |     |             |  |  |                |   |  |      |      |   |             |  |    |  |  |  |   | 
|--------------------------------------------------------------------------------------------------------- |  | -------------- | --- |  | ---- |  | --- | ----------- |  |  | -------------- | - |  | ---- | ---- | - | ----------- |  | -- |  |  |  | - | 
|                                                                                                          |  | 2016           |     |  | 2015 | 
|                                                                                                          |  | Canadiandollar |     |  | Euro |  |     | IndianRupee |  |  | Canadiandollar |   |  | Euro |      |   | IndianRupee | 
|                                                                                                          |  | USD$           |     |  | USD$ |  |     | USD$        |  |  | USD$           |   |  | USD$ |      |   | USD$        | 
|Increase (decrease) to finance costs - other expense, net from financial assets and financial
liabilities |  |                | 614 |  |      |  | (13 | )           |  |  | (156           | ) |  |      | (258 | ) |             |  | 52 |  |  |  |  | 
|                                                                                                          |  |                |     |  |      |  |     |             |  |  |                |   |  |      |      |   |             |  |    |  |  |  |   | 

Interest Rate Risk

The
Company is exposed to a risk of change in cash flows due to the fluctuations in interest rates applicable on its variable rate Revolving Credit Facility and other floating rate borrowings. The Companys overall risk management objective is to
minimize the long-term cost of debt, taking into account short-term and long-term earnings and cash flow volatility. The Companys risk strategy with respect to its exposure associated with floating rate borrowings is that the Financial Risk
Management Committee monitors the Companys amount of floating rate borrowings, taking into account the current and expected interest rate environment, the Companys leverage and sensitivity to earnings and cash flows due to changes in
interest rates. The Companys risk management objective at this time is to mitigate the variability in 30-day LIBOR-based cash flows.

To help accomplish this objective, the Company entered into interest rate swap agreements designated as cash flow hedges. The terms of the interest swap
agreements are as follows:



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|                |  |                   |  |                 |            |  |            |  |         |                         |  |  |       |  
|--------------- |  | ----------------- |  | --------------- | ---------- |  | ---------- |  | ------- | ----------------------- |  |  | ----- | -
|Effective Date  |  | Maturity          |  | Notional amount |            |  | Settlement |  |         | Fixed interestrate paid | 
|March 18, 2015  |  | November 18, 2019 |  | $               | 40,000,000 |  |            |  | Monthly |                         |  |  | 1.610 | %
|August 18, 2015 |  | August 20, 2018   |  | $               | 60,000,000 |  |            |  | Monthly |                         |  |  | 1.197 | %

The interest rate swap agreements involve the exchange of periodic payments excluding the notional principal amount upon which
the payments are based. These payments were recorded as an adjustment of interest expense on the hedged debt instruments. The related amount payable to or receivable from counterparties is included as an adjustment to accrued interest.

Additionally, the Company elects to use the Hypothetical Derivative methodology to measure the ineffectiveness of its hedging relationships in a given
reporting period to be recorded in earnings. Under the Hypothetical Derivative method, the actual interest rate swaps would be recorded at fair value on the balance sheet, and accumulated OCI would be adjusted to a balance that reflects the lesser
of either the cumulative change in the fair value of the actual interest rate swaps or the cumulative change in the fair value of the hypothetical derivatives. The determination of the fair values of both the hypothetical derivative and the actual
interest rate swaps will use discounted cash flows based on the relevant interest rate swap curves. The amount of ineffectiveness, if any, recorded in earnings in finance costs in other expense, net, would be equal to the excess of the cumulative
change in the fair value of the actual interest rate swaps over the cumulative change in the fair value of the hypothetical derivatives. Amounts previously included as part of OCI are transferred to earnings in the period during which the hedged
item impacts net earnings.

The change in fair value of the derivatives used for calculating hedge effectiveness was a $0.2 million decrease and
$0.4 million increase as of December 31, 2016 and 2015, respectively.

As of December 31, 2016 and 2015, the impact on the Companys
finance costsinterest expense from a 1.0% increase in interest rates, assuming all other variables remained equal, would be an increase of approximately $0.6 million and $0.3 million, respectively.

Credit Risk

Credit risk results from the possibility
that a loss may occur from the failure of another party to perform according to the terms of the contract. Generally, the carrying amount reported on the Companys consolidated balance sheet for its financial assets exposed to credit risk, net
of any applicable provisions for losses, represents the maximum amount exposed to credit risk.

Financial assets that potentially subject the Company to
credit risk consist primarily of cash, trade receivables and supplier rebate receivables and other receivables.

Cash

Credit risk associated with cash is substantially mitigated by ensuring that these financial assets are primarily placed with major financial institutions. The
Company performs an ongoing review and evaluation of the possible changes in the status and creditworthiness of its counterparties.

Trade receivables

As of December 31, 2016 and 2015, there were two customers with trade receivables that accounted for more than 5% of the Companys total
trade receivables. These trade receivables were current as of December 31, 2016 and 2015. The Company believes its credit risk with respect to trade receivables is limited due to the Companys credit evaluation process, reasonably short
collection terms and the creditworthiness of its customers and credit insurance. The Company regularly monitors its credit risk exposures and takes steps to mitigate the likelihood of these exposures from resulting in actual losses. Allowance for
doubtful accounts is maintained consistent with credit risk, historical trends, general economic conditions and other information and is taken into account in the consolidated financial statements.



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The following table presents an analysis of the age of trade receivables and related balance as of:



|                                |  |                  |        |  |                  |  |        | 
|------------------------------- |  | ---------------- | ------ |  | ---------------- |  | ------ | 
|                                |  | December 31,2016 |        |  | December 31,2015 | 
|                                |  | $                |        |  | $                | 
|Current                         |  |                  | 83,194 |  |                  |  | 74,371 | 
|Past due accounts not impaired  |  |                  |        |  |                  |  |        | 
|1  30 days past due            |  |                  | 5,636  |  |                  |  | 3,321  | 
|31  60 days past due           |  |                  | 947    |  |                  |  | 709    | 
|61  90 days past due           |  |                  | 146    |  |                  |  | 52     | 
|Over 90 days past due           |  |                  | 199    |  |                  |  | 64     | 
|                                |  |                  |        |  |                  |  |        | 
|                                |  |                  | 6,928  |  |                  |  | 4,146  | 
|Allowance for doubtful accounts |  |                  | 254    |  |                  |  | 128    | 
|                                |  |                  |        |  |                  |  |        | 
|Gross accounts receivable       |  |                  | 90,376 |  |                  |  | 78,645 | 
|                                |  |                  |        |  |                  |  |        | 

The Company makes estimates and assumptions in the process of determining an adequate allowance for doubtful accounts. Trade
receivables outstanding longer than the agreed upon payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time trade receivables are past due, the customers
current ability to pay its obligation to the Company, historical results and the condition of the general economy and the industry as a whole. The Company writes off trade receivables when they are determined to be uncollectible and any payments
subsequently received on such trade receivables are credited to the allowance for doubtful accounts. The allowance for doubtful accounts is primarily calculated on a specific-identification of trade receivable accounts.

The following table presents a continuity summary of the Companys allowance for doubtful accounts as of and for the year ended December 31:



|                           |  |      |     |   |      |  |      |  
|-------------------------- |  | ---- | --- | - | ---- |  | ---- | -
|                           |  | 2016 |     |   | 2015 | 
|                           |  | $    |     |   | $    | 
|Balance, beginning of year |  |      | 128 |   |      |  | 396  |  
|Additions                  |  |      | 124 |   |      |  | 286  |  
|Recoveries                 |  |      | 12  |   |      |  | 428  |  
|Write-offs                 |  |      | (10 | ) |      |  | (980 | )
|Foreign exchange           |  |      |    |   |      |  | (2   | )
|                           |  |      |     |   |      |  |      |  
|Balance, end of year       |  |      | 254 |   |      |  | 128  |  
|                           |  |      |     |   |      |  |      |  

Supplier rebates and other receivables

Credit risk associated with supplier rebates and other receivables is limited considering the amount is not material, the Companys large size and
diversified counterparties and geography.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial liabilities and obligations as they become due. The Company is exposed to
this risk mainly through its borrowings, excluding finance



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lease liabilities, and accounts payable and accrued liabilities and non-controlling interest put option. The Company finances its operations through a
combination of cash flows from operations and borrowings under its Revolving Credit Facility.

Liquidity risk management serves to maintain a sufficient
amount of cash and to ensure that the Company has financing sources for a sufficient authorized amount. The Company establishes budgets, cash estimates and cash management policies to ensure it has the necessary funds to fulfil its obligations for
the foreseeable future.

The following maturity analysis for non-derivative financial liabilities is based on the
remaining contractual maturities as of the balance sheet date. The amounts disclosed reflect the contractual undiscounted cash flows categorized by their earliest contractual maturity date on which the Company can be required to pay its obligation.

The maturity analysis for non-derivative financial liabilities and finance lease liabilities is as follows as of
December 31:



|                    |  |                                    |        |  |                           |  |         |                         |  |  |                                            |  |  |       |        |  |  |  |         | 
|------------------- |  | ---------------------------------- | ------ |  | ------------------------- |  | ------- | ----------------------- |  |  | ------------------------------------------ |  |  | ----- | ------ |  |  |  | ------- | 
|                    |  | Non-controllinginterest putoptions |        |  | Other long-termborrowings |  |         | Financeleaseliabilities |  |  | Accounts payableand accruedliabilities (1) |  |  | Total |       
|                    |  | $                                  |        |  | $                         |  |         | $                       |  |  | $                                          |  |  | $     |       
|2016                |  |                                    |        |  |                           |  |         |                         |  |  |                                            |  |  |       |        |  |  |  |         | 
|                    |  |                                    |        |  |                          
|Current maturity    |  |                                    |       |  |                           |  | 1,917   |                         |  |  | 6,078                                      |  |  |       | 78,248 |  |  |  | 86,243  | 
|2018                |  |                                    |       |  |                           |  | 264     |                         |  |  | 4,788                                      |  |  |       |       |  |  |  | 5,052   | 
|2019                |  |                                    | 5,010  |  |                           |  | 161,734 |                         |  |  | 986                                        |  |  |       |       |  |  |  | 167,730 | 
|2020                |  |                                    |       |  |                           |  | 829     |                         |  |  | 424                                        |  |  |       |       |  |  |  | 1,253   | 
|2021                |  |                                    | 5,010  |  |                           |  | 831     |                         |  |  | 364                                        |  |  |       |       |  |  |  | 6,205   | 
|2022 and thereafter |  |                                    |       |  |                           |  | 1,564   |                         |  |  | 2,639                                      |  |  |       |       |  |  |  | 4,203   | 
|                    |  |                                    |        |  |                           |  |         |                         |  |  |                                            |  |  |       |        |  |  |  |         | 
|                    |  |                                    | 10,020 |  |                           |  | 167,139 |                         |  |  | 15,279                                     |  |  |       | 78,248 |  |  |  | 270,686 | 
|                    |  |                                    |        |  |                           |  |         |                         |  |  |                                            |  |  |       |        |  |  |  |         | 
|                    |  |                                    |        |  |                          
|                    |  |                                    |        |  | Other long-termborrowings |  |         | Financeleaseliabilities |  |  | Accounts payableand accruedliabilities (1) |  |  | Total |       
|                    |  |                                    |        |  | $                         |  |         | $                       |  |  | $                                          |  |  | $     |       
|2015                |  |                                    |        |  |                           |  |         |                         |  |  |                                            |  |  |       |        |  |  |  |         | 
|                    |  |                                    |        |  |                          
|Current maturity    |  |                                    |        |  |                           |  |        |                         |  |  | 6,258                                      |  |  |       | 64,484 |  |  |  | 70,742  | 
|2017                |  |                                    |        |  |                           |  | 58      |                         |  |  | 6,054                                      |  |  |       |       |  |  |  | 6,112   | 
|2018                |  |                                    |        |  |                           |  | 100     |                         |  |  | 4,796                                      |  |  |       |       |  |  |  | 4,896   | 
|2019                |  |                                    |        |  |                           |  | 133,560 |                         |  |  | 986                                        |  |  |       |       |  |  |  | 134,546 | 
|2020                |  |                                    |        |  |                           |  | 200     |                         |  |  | 424                                        |  |  |       |       |  |  |  | 624     | 
|2021 and thereafter |  |                                    |        |  |                           |  | 700     |                         |  |  | 3,037                                      |  |  |       |       |  |  |  | 3,737   | 
|                    |  |                                    |        |  |                           |  |         |                         |  |  |                                            |  |  |       |        |  |  |  |         | 
|                    |  |                                    |        |  |                           |  | 134,618 |                         |  |  | 21,555                                     |  |  |       | 64,484 |  |  |  | 220,657 | 
|                    |  |                                    |        |  |                           |  |         |                         |  |  |                                            |  |  |       |        |  |  |  |         | 



|(1) | Excludes employee benefits
|--- | --------------------------

The Companys unused
availability under the Revolving Credit Facility and available cash on hand amounted to $158.2 million as of December 31, 2016, and $182.3 million as of December 31, 2015.

Price Risk

The Companys price risk arises from
changes in its oil-derived raw material prices, which are significantly influenced by the fluctuating underlying crude oil markets. The Companys objectives in managing its price risk are threefold:
(i) to protect its financial result for the period from significant fluctuations in raw material costs, (ii) to anticipate, to the extent possible, and plan for significant changes in the raw material markets



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##### Table of Contents

and (iii) to ensure sufficient availability of raw material required to meet the Companys manufacturing requirements. In order to manage its exposure to price risks, the Company
closely monitors current and anticipated changes in market prices and develops pre-buying strategies and patterns, and seeks to adjust its selling prices when market conditions permit. Historical results
indicate managements ability to rapidly identify fluctuations in raw material prices and, to the extent possible, incorporate such fluctuations in the Companys selling prices.

As of December 31, 2016, all other parameters being equal, a hypothetical increase of 10% in the cost of raw materials, with no corresponding sales price
adjustments, would result in an increase in cost of sales of $40.0 million (an increase in cost of sales of $39.8 million in 2015). A similar decrease of 10% will have the opposite impact.

Capital Management

The Company manages its capital to
safeguard the Companys ability to continue as a going concern, provide sufficient liquidity and flexibility to meet strategic objectives and growth and provide adequate return to its shareholders, while taking into consideration financial
leverage and financial risk.

The capital structure of the Company consists of cash, borrowings and equity. A summary of the Companys capital
structure is as follows as of December 31:



|             |  |      |         |  |      |  |         | 
|------------ |  | ---- | ------- |  | ---- |  | ------- | 
|             |  | 2016 |         |  | 2015 | 
|             |  | $    |         |  | $    | 
|Cash         |  |      | 20,956  |  |      |  | 17,615  | 
|Borrowings   |  |      | 179,825 |  |      |  | 152,836 | 
|Total equity |  |      | 242,943 |  |      |  | 216,728 | 

The Company manages its capital structure in accordance with its expected business growth, operational objectives and
underlying industry, market and economic conditions. Consequently, the Company will determine, from time to time, its capital requirements and will accordingly develop a plan to be presented and approved by its Board of Directors. The plan may
include the repurchase of common shares, the issuance of shares, the payment of dividends and the issuance of new debt or the refinancing of existing debt.

23 -POST REPORTING EVENTS

Adjusting Events

No adjusting events have occurred
between the reporting date of these consolidated financial statements and the date of authorization.

Non-Adjusting Events

No significant non-adjusting events have occurred between the reporting date of these consolidated financial statements
and the date of authorization with the exception of the items discussed below.

On February 17, 2017, the Board of Directors approved amendments to
the PSU Plan and DSU Plan to provide for only cash settlement of PSU and DSU awards, respectively. As a result of the amendment, prospectively and until award settlement, the Company will remeasure the fair value of the awards on the amendment date
and at each reporting period end date, and present the cash-settled awards as a liability within other liabilities and not in contributed surplus in the consolidated balance sheets. Changes in the fair value of the liability will be reflected in
SG&A.

On March 8, 2017, the Company declared a cash dividend of $0.14 per common share payable on March 31, 2017 to shareholders of record
at the close of business on March 21, 2017. The estimated amount of this dividend payment is $8.3 million based on 59,060,335 shares of the Companys common shares issued and outstanding as of March 8, 2017.



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