- Proxy Soliciting Materials (revised) (PRER14A)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

Filed by the Registrant     x

Filed by a Party other than the Registrant     ¨

Check the appropriate box:

HICKS ACQUISITION COMPANY II, INC.

(Name of Registrant as Specified In Its Charter)

N/A

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

Common Stock, par value $0.0001 per share, of the Registrant

13,300,000 shares of Common Stock of the Registrant

$9.87, pursuant to Exchange Act Rule 0-11(c)(1) and 0-11(a)(4), the average high and low prices per share of the Registrant’s common stock reported in the consolidated reporting system on May 11, 2012.

276,021,000

$55,204.20, computed in accordance with Exchange Act Rule 0-11(c)(1) and 0-11(a)(4) as one-fiftieth of one percent of the value of securities and cash being transferred to security holders.

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SUBJECT TO AMENDMENT AND COMPLETION, DATED JUNE 21, 2012

PROXY STATEMENT FOR SPECIAL MEETING OF PUBLIC WARRANTHOLDERS AND SPECIAL MEETING OF STOCKHOLDERS OF HICKS ACQUISITION COMPANY II, INC.

Dear Stockholders and Public Warrantholders of Hicks Acquisition Company II, Inc. (“HACII”):

You are cordially invited to attend a special meeting of HACII stockholders and HACII public warrantholders. HACII stockholders will be asked to: (i) elect nine directors to serve as HACII’s board of directors (the “Director Election Proposal”); (ii) adopt an equity incentive plan (the “Incentive Plan”) for the directors, officers, members, managers, employees, consultants and advisors of HACII and its affiliates (the “Incentive Plan Proposal”); (iii) adopt the Equity Purchase Agreement, dated as of May 16, 2012, as amended (the “Equity Purchase Agreement”), by and among HACII, HH-HACII, L.P. (the “Sponsor”), Appleton Papers Inc. (“Appleton”) and Paperweight Development Corp. (“PDC”), and the Cross Purchase Agreement, dated as of May 16, 2012 (the “Cross Purchase Agreement”), by and between HACII and PDC, and approve the transactions contemplated thereby (collectively, the “Transaction”), pursuant to which, through a series of transactions, Appleton will become a non-wholly-owned subsidiary of HACII (the “Transaction Proposal”); and (iv) approve, if necessary or appropriate, the adjournment of the special meeting of HACII stockholders to solicit additional proxies if there are insufficient votes at the time of the meeting to approve the Director Election Proposal, the Incentive Plan Proposal and the Transaction Proposal (the “Stockholder Adjournment Proposal”).

Holders of HACII’s warrants, each of which is exercisable for one share of common stock of HACII, par value $0.0001 per share, issued in HACII’s initial public offering (the “HACII Public Warrants”) will be asked to approve an amendment to the warrant agreement that governs all of the HACII warrants in order to (i) make each HACII Public Warrant and each HACII warrant held by the Sponsor (the “Sponsor Warrants”) exercisable for one-half of one share of common stock of HACII at an exercise price of $6.00 per half-share (the “Warrant Adjustment”), (ii) allow each holder of HACII Public Warrants to elect to receive, for each such outstanding HACII Public Warrant (in exchange for the reduction of shares for which the HACII Public Warrants are exercisable), either (x) the right to receive $0.625 in cash (the “Cash Amount”) or (y) the right to exercise the existing warrant for an additional 0.0879 of a share of common stock of HACII (the “Public Earnout Shares”), at an exercise price of $0.0001, in the event the last sales price of shares of common stock of HACII equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction, subject to a limitation that the holders of no more than 4,550,626 HACII Public Warrants may receive the Public Earnout Shares, and (iii) cause the Sponsor to receive (in exchange for the reduction of shares for which the Sponsor Warrants are exercisable) an additional 0.0879 of a share of common stock of HACII per Sponsor Warrant (the “Sponsor Earnout Shares”), subject to forfeiture by the Sponsor in the event the last sales price of shares of common stock of HACII does not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction (collectively, the “Warrant Amendment Proposal”). If the Transaction is consummated, any holder of HACII Public Warrants who votes against the approval of the Warrant Amendment Proposal or who makes no election will receive the Cash Amount for each such HACII Public Warrant. The Sponsor Earnout Shares are effectively the same as the Public Earnout Shares, as the economic value of both the Sponsor Earnout Shares and the Public Earnout Shares are triggered by the same target stock price. The effect of the Warrant Adjustment will be to reduce the number of shares of common stock of HACII issuable upon exercise of the HACII warrants by half (excluding the Public Earnout Shares). HACII stockholders who also are holders of HACII Public Warrants may suffer adverse tax consequences as a result of the Warrant Amendment Proposal, even though the Transaction otherwise will be tax neutral. Holders should review the section entitled “ Material U.S. Federal Income Tax Consequences—The Warrant Amendment Proposal ” for a more comprehensive discussion of the tax aspects of the Warrant Amendment Proposal applicable to them.

If each of the Warrant Amendment Proposal, the Director Election Proposal, the Incentive Plan Proposal and the Transaction Proposal is not approved, then HACII will not consummate the Transaction. In the event that the Transaction is not consummated, the Warrant Amendment Proposal, the Director Election Proposal and the Incentive Plan Proposal will not take effect. If a transaction with Appleton is not consummated and HACII is

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unable to consummate another business combination by July 14, 2012, HACII will be required to commence proceedings to dissolve and liquidate and the outstanding HACII warrants will expire worthless. See section entitled “ HACII’s Business—Liquidation if No Business Combination ” for additional information.

Each of these proposals is more fully described in the accompanying proxy statement.

HACII common stock, units and public warrants are listed on the Nasdaq Capital Market under the symbol “HKAC,” “HKACU” and “HKACW,” respectively.

Pursuant to the Amended and Restated Certificate of Incorporation of HACII (the “Charter”), in connection with the Transaction Proposal HACII is providing all holders of shares of common stock of HACII issued as part of the units in HACII’s initial public offering (the “Public Shares”) with the opportunity to have their Public Shares redeemed pursuant to, and subject to the limitations set forth in the Charter, for cash equal to the applicable redemption price per share determined in accordance with the Charter (the “Redemption”), provided that HACII shall not redeem or repurchase Public Shares to the extent such redemption would result in HACII’s failure to meet a closing condition under the Equity Purchase Agreement that it have at least $82.0 million in trust proceeds after giving effect to the Redemption and/or any permitted repurchases of Public Shares but prior to the payment of the Cash Amount, expenses and certain other amounts.

Your vote is very important. Whether or not you plan to attend the special meetings in person, please submit your proxy card without delay.

We encourage you to read this proxy statement carefully. In particular, you should review the matters discussed under the caption “ Risk Factors ” beginning on page 34.

HACII’s board of directors recommends (i) that HACII stockholders vote FOR approval of the Director Election Proposal, FOR approval of the Incentive Plan Proposal, FOR approval of the Transaction Proposal and FOR approval of the Stockholder Adjournment Proposal and (ii) that HACII Public Warrantholders vote FOR the Warrant Amendment Proposal and FOR the Warrant Adjournment Proposal. When you consider the recommendation of HACII’s board of directors in favor of the Transaction Proposal and the Warrant Amendment Proposal, you should keep in mind that certain of HACII’s directors and officers, including the Chairman of the Board, Thomas O. Hicks, have interests in the Transaction that may conflict with your interests as a stockholder. See the section entitled, “The Transaction—Potential Conflicts of Interests of HACII’s Directors and Officers in the Transaction.”

Thank you for your consideration of these matters.

Sincerely,

Christina Weaver Vest

President, Chief Executive Officer and Chief Financial Officer

Hicks Acquisition Company II, Inc.

Whether or not you plan to attend the special meeting of HACII stockholders or the special meeting of HACII Public Warrantholders, please submit your proxy by completing, signing, dating and mailing the enclosed proxy cards in the pre-addressed postage paid envelope or by using the telephone or Internet procedures provided to you by your broker or bank . If your shares or warrants are held in an account at a brokerage firm or bank, you must instruct your broker or bank on how to vote your shares or warrants or, if you wish to attend the special meeting of HACII stockholders or the special meeting of HACII Public Warrantholders and vote in person, you must obtain a proxy from your broker or bank. HACII has confirmed that approximately     % of “street name” holders will have access to telephone and Internet voting.

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Neither the Securities and Exchange Commission nor any state securities regulatory agency has approved or disapproved of the transaction, passed upon the merits or fairness of the transaction or passed upon the adequacy or accuracy of this proxy statement. Any representation to the contrary is a criminal offense.

This proxy statement is dated                 , 2012 and is first being mailed to HACII stockholders and HACII Public Warrantholders on or about                 , 2012.

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HICKS ACQUISITION COMPANY II, INC.

100 Crescent Court, Suite 1200

Dallas, Texas 75201

NOTICE OF SPECIAL MEETING OF PUBLIC WARRANTHOLDERS

OF HICKS ACQUISITION COMPANY II, INC.

To Be Held On July 11, 2012

To the Public Warrantholders of Hicks Acquisition Company II, Inc. (“HACII”):

NOTICE IS HEREBY GIVEN that the special meeting of HACII warrantholders owning warrants of HACII, each of which is exercisable for one share of common stock of HACII, par value $0.0001 per share (the “HACII warrants”), issued in HACII’s initial public offering (such warrants, the “HACII Public Warrants” and such holders, the “HACII Public Warrantholders”) will be held at 9:00 a.m., Central Daylight Time, on July 11, 2012, at the offices of Akin Gump Strauss Hauer & Feld, LLP, 1700 Pacific Avenue, 39th Floor, Dallas, Texas 75201 for the following purposes:

1. to approve an amendment (the “Warrant Amendment”) to the warrant agreement (the “Warrant Agreement”) that governs all of the HACII warrants in connection with the consummation of the transactions contemplated by the Equity Purchase Agreement, dated as of May 16, 2012, as amended (the “Equity Purchase Agreement”), by and among HACII, HH-HACII, L.P. (the “Sponsor”), Appleton Papers Inc. (“Appleton”) and Paperweight Development Corp. (“PDC”), and the Cross Purchase Agreement, dated as of May 16, 2012 (the “Cross Purchase Agreement”), by and between HACII and PDC, pursuant to which, through a series of transactions (collectively, the “Transaction”), Appleton will become a non-wholly-owned subsidiary of HACII. The Warrant Amendment would amend the Warrant Agreement in order to (i) make each HACII Public Warrant and each HACII warrant held by the Sponsor (the “Sponsor Warrants”) exercisable for one-half of one share of common stock of HACII at an exercise price of $6.00 per half-share (the “Warrant Adjustment”), (ii) allow each holder of HACII Public Warrants to elect to receive, for each such outstanding HACII Public Warrant (in exchange for the reduction of shares for which the HACII Public Warrants are exercisable), either (x) the right to receive $0.625 in cash (the “Cash Amount”) or (y) the right to exercise the existing warrant for an additional 0.0879 of a share of common stock of HACII (the “Public Earnout Shares”), at an exercise price of $0.0001, in the event the last sales price of shares of common stock of HACII equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction, subject to a limitation that the holders of no more than 4,550,626 HACII Public Warrants may receive the Public Earnout Shares, and (iii) cause the Sponsor to receive (in exchange for the reduction of shares for which the Sponsor Warrants are exercisable) an additional 0.0879 of a share of common stock of HACII per Sponsor Warrant (the “Sponsor Earnout Shares”) subject to forfeiture by the Sponsor in the event the last sales price of shares of common stock of HACII does not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction (collectively, the “Warrant Amendment Proposal”). If the Transaction is consummated, any holder of HACII Public Warrants who votes against the approval of the Warrant Amendment Proposal or who makes no election will receive $0.625 in cash per such HACII Public Warrant. The Sponsor Earnout Shares are effectively the same as the Public Earnout Shares, as the economic value of both the Sponsor Earnout Shares and the Public Earnout Shares are triggered by the same target stock price. The effect of the Warrant Adjustment will be to reduce the number of shares of common stock of HACII issuable upon exercise of the HACII warrants by half (excluding the Public Earnout Shares).

2. to approve the adjournment of the special meeting of HACII Public Warrantholders, if necessary, to permit further solicitation and vote of proxies in favor of the Warrant Amendment Proposal (the “Warrantholder Adjournment Proposal”); and

3. such other matters as may properly come before the special meeting of HACII Public Warrantholders or any adjournment or postponement thereof.

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HACII’s board of directors recommends that HACII Public Warrantholders vote FOR the Warrant Amendment Proposal and FOR the Warrantholder Adjournment Proposal. When you consider the recommendation of HACII’S board of directors in favor of the Warrant Amendment Proposal, you should keep in mind that certain of HACII’s directors and officers, including the Chairman of the Board, Thomas O. Hicks, have interests in the Transaction that may conflict with your interests as a warrantholder. See the section entitled, “ The Transaction — Potential Conflicts of Interests of HACII’s Directors and Officers in the Transaction .”

These items of business are described in the enclosed proxy statement, which you are encouraged to read in its entirety before voting. Only holders of record of HACII Public Warrants at the close of business on June 19, 2012 are entitled to notice of the special meeting of HACII Public Warrantholders and to vote at the special meeting of HACII Public Warrantholders and any adjournments or postponements thereof.

A complete list of HACII Public Warrantholders of record entitled to vote at the special meeting of HACII Public Warrantholders will be available for ten days before the special meeting at the principal executive offices of HACII for inspection by warrantholders during ordinary business hours for any purpose germane to the special meeting.

All HACII Public Warrantholders are cordially invited to attend the special meeting of HACII Public Warrantholders in person. Your vote is very important. Whether or not you plan to attend the special meeting of HACII Public Warrantholders, please read the enclosed proxy statement carefully, sign, date and return the enclosed proxy card as soon as possible in the envelope provided. If your warrants are held in “street name” or are in a margin or similar account, your broker or bank may provide you with voting instructions (including any instructions for voting by telephone or the Internet). HACII has confirmed that approximately         % of street name holders will have access to telephone and Internet voting. You should contact your broker or bank to ensure that votes related to the warrants you beneficially own are properly counted.

Thank you for your participation. We look forward to your continued support.

                    , 2012

By the order of the Board of Directors

Christina Weaver Vest

President, Chief Executive Officer and Chief Financial Officer

IF YOU SUBMIT YOUR PROXY CARD WITHOUT AN INDICATION OF WHO YOU WISH TO VOTE, YOUR WARRANTS WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS.

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HICKS ACQUISITION COMPANY II, INC.

100 Crescent Court, Suite 1200

Dallas, Texas 75201

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS OF HICKS ACQUISITION COMPANY II, INC.

To Be Held On July 11, 2012

To the Stockholders of Hicks Acquisition Company II, Inc. (“HACII”):

NOTICE IS HEREBY GIVEN that the special meeting of HACII stockholders will be held at 10:00 a.m., Central Daylight Time, on July 11, 2012, at the offices of Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific Avenue, 39th Floor, Dallas, Texas 75201 for the following purposes:

1.    to elect nine directors to serve as HACII’s board of directors (the “Director Election Proposal”);

2.    to adopt an equity incentive plan for the directors, officers, members, managers, employees, consultants and advisors of HACII and its affiliates (the “Incentive Plan Proposal”);

3.    to (a) adopt the Equity Purchase Agreement, dated as of May 16, 2012, as amended (the “Equity Purchase Agreement”), by and among HACII, HH-HACII, L.P., Appleton Papers Inc. (“Appleton”) and Paperweight Development Corp. (“PDC”), (b) adopt the Cross Purchase Agreement, dated as of May 16, 2012 (the “Cross Purchase Agreement”), by and between HACII and PDC, and (c) approve the transactions contemplated thereby (collectively, the “Transaction”), pursuant to which, through a series of transactions, Appleton will become a non-wholly-owned subsidiary of HACII (the “Transaction Proposal”);

4.    to approve, if necessary or appropriate, the adjournment of the special meeting of HACII stockholders to solicit additional proxies if there are insufficient votes at the time of the meeting to approve the Director Election Proposal, the Incentive Plan Proposal and the Transaction Proposal (the “Stockholder Adjournment Proposal”); and

5.    such other matters as may properly come before the special meeting of HACII stockholders or any adjournment or postponement thereof.

HACII’s board of directors recommends that HACII stockholders vote FOR the Director Election Proposal, FOR the Incentive Plan Proposal, FOR the Transaction Proposal, and FOR the Stockholder Adjournment Proposal. When you consider the recommendation of HACII’s board of directors in favor of the Transaction Proposal, you should keep in mind that certain of HACII’s directors and officers, including the Chairman of the Board, Thomas O. Hicks, have interests in the Transaction that may conflict with your interests as a stockholder. See the section entitled, “ The Transaction—Potential Conflicts of Interests of HACII’s Directors and Officers in the Transaction .”

These items of business are described in the enclosed proxy statement, which you are encouraged to read in its entirety before voting. Only holders of record of HACII’s common stock at the close of business on June 19, 2012 are entitled to notice of the special meeting of HACII stockholders and to vote at the special meeting of stockholders and any adjournments or postponements thereof.

A complete list of HACII’s stockholders of record entitled to vote at the special meeting of HACII stockholders will be available for ten days before the special meeting at the principal executive offices of HACII for inspection by stockholders during ordinary business hours for any purpose germane to the special meeting.

All HACII stockholders are cordially invited to attend the special meeting of HACII stockholders in person. Your vote is important regardless of the number of shares you own. Whether you plan to attend the special meeting of HACII stockholders, please read the enclosed proxy statement carefully, sign, date and return the enclosed proxy card as soon as possible in the envelope provided. If your shares are held in “street name” or are in a margin or similar account, your broker or bank may provide you with voting instructions (including any instructions for voting by telephone or Internet). HACII has confirmed that approximately      % of street name holders will have access to telephone and Internet voting. You should contact your broker or bank to ensure that votes related to the shares you beneficially own are properly counted.

Thank you for your participation. We look forward to your continued support.

                    , 2012

By Order of the Board of Directors

Christina Weaver Vest

President, Chief Executive Officer and Chief Financial Officer

IF YOU SUBMIT YOUR PROXY CARD WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS.

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QUESTIONS AND ANSWERS ABOUT THE PROPOSALS FOR HACII STOCKHOLDERS AND HACII PUBLIC WARRANTHOLDERS

The following questions and answers briefly address some commonly asked questions about the proposals to be presented at the special meeting of HACII Public Warrantholders and at the special meeting of HACII stockholders, including the proposed transaction. The following questions and answers may not include all the information that is important to warrantholders and stockholders of HACII. We urge HACII warrantholders and HACII stockholders to read carefully this entire proxy statement, including “Risk Factors,” the disclosure of potential conflicts under the question headed “Do any of HACII’s directors or officers have interests that may conflict with my interests with respect to the Transaction?”, the annexes and the other documents included or referred to herein.

HACII stockholders are being asked to consider and vote upon a proposal to adopt the Equity Purchase Agreement and the Cross Purchase Agreement, pursuant to which, through a series of transactions, Appleton will become a non-wholly-owned subsidiary of HACII.

HACII warrantholders owning warrants of HACII, each of which is exercisable for one share of common stock of HACII, par value $0.0001 per share, or the HACII warrants, issued in HACII’s initial public offering, which such warrants are referred to as the HACII Public Warrants and which such holders are referred to as the HACII Public Warrantholders, are being asked to consider and vote upon a proposal to approve an amendment, which is referred to herein as the Warrant Amendment, to the warrant agreement, which is referred to herein as the Warrant Agreement, that governs the HACII warrants in order to (i) make each HACII Public Warrant and each HACII warrant held by the Sponsor, which such warrants are referred to herein as the Sponsor Warrants, exercisable for one-half of one share of common stock of HACII at an exercise price of $6.00 per half-share, which is referred to herein as the Warrant Adjustment, (ii) allow each holder of HACII Public Warrants to elect to receive, for each such outstanding HACII Public Warrant (in exchange for the reduction of shares for which the HACII Public Warrants are exercisable), either (x) the right to receive $0.625 in cash, which is referred to herein as the Cash Amount, or (y) the right to exercise the existing warrant for an additional 0.0879 of a share of common stock of HACII, which are referred to herein as the Public Earnout Shares, at an exercise price of $0.0001, in the event the last sales price of shares of common stock of HACII equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction, subject to a limitation that the holders of no more than 4,550,626 HACII Public Warrants may receive the Public Earnout Shares, and (iii) cause the Sponsor to receive (in exchange for the reduction of shares for which the Sponsor Warrants are exercisable) an additional 0.0879 of a share of common stock of HACII per Sponsor Warrant, referred to herein as the Sponsor Earnout Shares, subject to forfeiture by the Sponsor in the event the last sales price of shares of common stock of HACII does

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not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction. This proposal to amend the Warrant Agreement is referred to herein as the Warrant Amendment Proposal. If the Transaction is consummated, any holder of HACII Public Warrants who votes against the approval of the Warrant Amendment Proposal or who makes no election will receive the Cash Amount for each such HACII Public Warrant. The election to receive the Cash Amount is referred to herein as the Cash Election and the election to receive the Public Earnout Shares is referred to as the Earnout Shares Election. The Sponsor Earnout Shares are effectively the same as the Public Earnout Shares, as the economic value of both the Sponsor Earnout Shares and the Public Earnout Shares are triggered by the same target stock price. The effect of the Warrant Adjustment will be to reduce the number of shares of common stock of HACII issuable upon exercise of the HACII warrants by half (excluding the Public Earnout Shares). The form of the Warrant Amendment is attached to this proxy statement as Annex A and is incorporated into this proxy statement by reference.

If the Transaction is consummated, HACII stockholders may redeem their shares of common stock of HACII, par value $0.0001 per share, or HACII Common Stock, for cash equal to their pro rata share of the aggregate amount then on deposit in the trust account (before payment of deferred underwriting commissions and including interest earned on their pro rata portion of the trust account, net of franchise and income taxes payable on such interest and net of interest income of up to approximately $2.25 million on the trust account, which interest income was previously released to HACII to fund its working capital requirements). Accordingly, stockholders who do not elect to have their shares redeemed and remain HACII stockholders after the Transaction will bear, in addition to the franchise and income taxes payable, the economic burden of the deferred underwriting commissions because such amounts will be payable by HACII. The redemption of HACII Common Stock for cash in connection with the consummation of the Transaction is referred to herein as the Redemption.

The units that were issued in HACII’s initial public offering, or the HACII units, each consist of one share of HACII Common Stock and one warrant to purchase one share of HACII Common Stock, which we refer to as the HACII Public Warrants. The HACII units, HACII Common Stock and HACII Public Warrants are currently listed on the Nasdaq Capital Market. None of the HACII units, the HACII Common Stock or the HACII Public Warrants will be exchanged in the Transaction and will continue to trade on the Nasdaq Capital Market following the consummation of the Transaction.

HACII stockholders are also being asked to elect nine directors to serve on HACII’s board of directors, which we refer to as the Director Election Proposal. Three director nominees, Stephen P. Carter, Thomas O. Hicks and Andrew F. Reardon, if elected, will serve on HACII’s board of directors as Class I Directors until the 2013 annual meeting of stockholders; three director nominees, Mark R. Richards, Kathi P. Seifert and Mark A. Suwyn, if elected, will serve on HACII’s board of directors as Class II Directors until the 2014 annual meeting of stockholders; and three director nominees, Terry M. Murphy, Christina Weaver Vest and George W. Wurtz, if elected, will serve on HACII’s board of directors as Class III Directors until the 2015 annual meeting of stockholders.

HACII stockholders are also being asked to approve the Hicks Acquisition Company II, Inc. Equity Incentive Plan, or the Incentive Plan, pursuant to which 2.3 million shares of HACII Common Stock will be reserved for issuance to directors, officers, members, managers, employees, consultants and advisors of HACII and its affiliates, which we refer to as the Incentive Plan Proposal. The purpose of the Incentive Plan is to provide a means through which HACII and its affiliates may attract and retain key personnel and provide a means whereby directors, officers, members, managers, employees, consultants and advisors (and prospective directors, officers, members, managers, employees, consultants and advisors) of HACII and its affiliates can acquire and maintain an equity interest in HACII, or be paid incentive compensation, thereby strengthening their commitment to the welfare of HACII and its affiliates and aligning their interests with those of HACII’s stockholders.

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The approval of the Warrant Amendment Proposal by the HACII Public Warrantholders and of the Director Election Proposal, the Incentive Plan Proposal and the Transaction Proposal by HACII stockholders are preconditions to the consummation of the Transaction. In the event that the Transaction is not consummated, the Warrant Amendment Proposal, the Director Election Proposal and the Incentive Plan Proposal will not take effect.

This proxy statement contains important information about the proposed Transaction and the other matters to be acted upon at the special meeting of HACII Public Warrantholders and at the special meeting of HACII stockholders. You should read it carefully.

Below are proposals on which HACII stockholders are being asked to vote.

It is important for you to note that in the event that the Warrant Amendment Proposal or the Transaction Proposal does not receive the requisite vote for approval, then HACII will not consummate the Transaction or the Redemption. In the event that the Transaction is not consummated, the Warrant Amendment Proposal, the Director Election Proposal and the Incentive Plan Proposal will not take effect. If HACII does not consummate a transaction with Appleton and it is unable to consummate an initial business combination by July 14, 2012, HACII will be required to dissolve and liquidate and all HACII warrants will expire worthless.

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Pursuant to the Equity Purchase Agreement, Appleton will convert from a Delaware corporation to a Delaware limited liability company and issue to PDC 9,632,024 Class B units of Appleton, or Appleton Class B Units, plus certain additional Appleton Class B Units, which we refer to as the Over-the-Top Units, in an amount to be determined by the parties prior to closing. At the closing of the Equity Purchase Agreement, HACII will acquire an aggregate number of Class A units of Appleton, or Appleton Class A Units, equal to (a) the number of shares of HACII Common Stock issued and outstanding after giving effect to the Redemption and certain permitted repurchases of shares of HACII Common Stock in connection with the Transaction, less (b) the number of Over-the-Top Units. In exchange, HACII will pay to Appleton an amount in cash equal to the amount held in the trust account less (i) amounts used by HACII to make permitted repurchases of HACII Common Stock, (ii) amounts payable to holders of Public Shares (as defined below), or the HACII Public Stockholders, that properly exercise their redemption rights, (iii) the Cash Amount payable to HACII Public Warrantholders, and (iv) the aggregate costs, fees and expenses incurred by HACII in connection with its pursuit of an initial business combination (including deferred underwriting commissions) and other working capital expenses.

One day after the closing of the transactions contemplated by the Equity Purchase Agreement, pursuant to the Cross Purchase Agreement, PDC will sell the Over-the-Top Units to HACII, which HACII will immediately surrender to Appleton for cancellation and, upon its receipt thereof, Appleton will issue to HACII a number of Appleton Class A Units equal to the number of cancelled Over-the-Top Units. In exchange, (i) HACII will issue to PDC 481,601.2 shares of Series A preferred stock, par value $0.0001 per share, of HACII, or HACII Series A Preferred Stock, (ii) PDC will be entitled to receive, to the extent it becomes due and payable in accordance with the terms of the Cross Purchase Agreement, up to an aggregate of 3.0 million shares of HACII Common Stock, or the Contingency Consideration, which will be issued upon the achievement of certain stock price targets based upon the trading price of the HACII Common Stock, and (iii) PDC will be allocated 85% of certain tax-related benefits arising out of the Transaction pursuant to a Tax Receivable Agreement to be entered into between HACII and PDC, or the Tax Receivable Agreement. A condition to the closing of the transactions contemplated by the Equity Purchase Agreement is that, after giving effect to the Redemption and any permitted repurchases of Public Shares, not less than $82.0 million remains in the trust account. Assuming that exactly $82.0 million remains in the trust account after the Redemption and any such repurchases, upon the closing of the Transaction, HACII’s Appleton Class A Units will represent an approximate 54.5% ownership interest in Appleton and holders of HACII Common Stock will control approximately 54.5% of the voting power of HACII, with PDC (either directly or through a wholly-owned subsidiary) holding the remaining ownership interests in Appleton and voting power of HACII. In the event that no HACII Public Stockholders elect to redeem their shares of HACII Common Stock and HACII does not make any permitted repurchases, upon the closing of the Transaction, HACII’s Appleton Class A Units will represent an approximate 65.5% ownership interest in Appleton and holders of HACII Common Stock will control approximately 65.5% of the voting power of HACII, with PDC (either directly or through a wholly-owned subsidiary) holding the remaining ownership interests in Appleton and voting power of HACII. See the section entitled “ Beneficial Ownership of Securities ” for more information regarding the post-Transaction ownership. Therefore, immediately following the consummation of the Transaction, PDC (either directly or through a wholly-owned subsidiary) will hold between approximately 45.5% and 34.5% of the ownership interests in Appleton and the voting power of HACII, depending on the number of redemptions and permitted repurchases. Accordingly, the interests of the current HACII stockholders in HACII and Appleton will be proportionately diluted according to PDC’s interests in each of HACII and Appleton.

For more information, see the sections entitled “ The Transaction ,” “ The Purchase Agreements ” and “ Description of Securities .”

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Therefore, based on the $25,000 and $5.0 million purchase price paid by the Sponsor for the Founder Shares and the Sponsor Warrants, respectively, if the Transaction is consummated:

Approval of the Transaction Proposal requires the affirmative vote of the holders of a majority of the issued and outstanding shares of HACII Common Stock entitled to vote thereon as of the record date, present in person or represented by proxy, at the special meeting of HACII stockholders. As of the record date of the special meeting of HACII stockholders, 2,142,857 Founder Shares, or approximately 12.5% of the outstanding HACII Common Stock, would be voted in accordance with the majority of the votes cast by HACII Public Stockholders with respect to the Transaction Proposal. If HACII, the Initial Stockholders or HACII’s officers and directors purchase Public Shares from existing HACII stockholders that are likely to vote against the Transaction Proposal, or that are likely to elect to redeem their Public Shares, the probability that the Transaction Proposal will be approved would increase.

In addition, the exercise of HACII’s directors’ and officers’ discretion in agreeing to changes or waivers in the terms of the Transaction may result in a conflict of interest when determining whether such changes or waivers are appropriate and in HACII Public Stockholders’ best interest.

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HACII consummated the IPO on October 14, 2010. Approximately $149.25 million of the proceeds of the IPO (including deferred underwriting commissions) and the sale to the Sponsor of 6,666,667 Sponsor Warrants was placed in a trust account immediately following the IPO. Upon the consummation of an initial business combination, the amounts held in the trust account will be released to HACII. As of             , 2012, $             million was held in the trust account. If the Transaction Proposal is approved, HACII intends to use a portion of the funds held in the trust account to pay (i) HACII’s aggregate costs, fees and expenses in connection with the consummation of an initial business combination (including deferred underwriting commissions) and other working capital expenses, (ii) HACII Public Stockholders who properly exercise their redemption rights, (iii) the Cash Amount payable to HACII Public Warrantholders, and (iv) for any repurchases by HACII of Public Shares, if any, prior to the consummation of the Transaction. The remaining balance in the trust account will be contributed to Appleton in exchange for HACII’s receipt of membership interests in Appleton in connection with the Transaction. See the sections entitled “ The Transaction—HACII’s Board of Directors’ Reasons for the Approval of the Transaction” and “The Purchase Agreements ” for additional information.

Approval of the Warrantholder Adjournment Proposal requires the affirmative vote of the holders of a majority of the outstanding HACII Public Warrants represented in person or by proxy at the special meeting of HACII Public Warrantholders and entitled to vote thereon as of the record date.

Abstentions will have the same effect as a vote “AGAINST” the Warrant Amendment Proposal and the Warrantholder Adjournment Proposal. A broker non-vote will have the effect of a vote “AGAINST” the Warrant Amendment Proposal. Broker non-votes will have no effect on the Warrantholder Adjournment Proposal.

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Approval of the Incentive Plan Proposal, the Transaction Proposal and the Stockholder Adjournment Proposal require the affirmative vote of the holders of a majority of the issued and outstanding shares of HACII Common Stock entitled to vote thereon as of the record date present in person or represented by proxy at the special meeting of HACII stockholders. See the section entitled “ Special Meetings of HACII Public Warrantholders and HACII Stockholders ” for additional information.

Abstentions will have the same effect as a vote “AGAINST” the Incentive Plan Proposal, the Transaction Proposal and the Stockholder Adjournment Proposal. A broker non-vote will not be considered present for the purposes of establishing a quorum and will have no effect on the Incentive Plan Proposal, the Transaction Proposal or the Stockholder Adjournment Proposal.

In connection with the IPO, HACII and the representative of the underwriters in the IPO entered into agreements with the Initial Stockholders pursuant to which the Initial Stockholders agreed to vote:

Approval of the Transaction Proposal requires the affirmative vote of the holders of a majority of the issued and outstanding shares of HACII Common Stock entitled to vote thereon as of the record date present in person or represented by proxy at the special meeting of HACII stockholders. As of the record date of the special meeting of HACII stockholders, 2,142,857 Founder Shares, or 12.5% of the issued and outstanding shares of HACII Common Stock, would be voted in accordance with the majority of the votes cast by HACII Public Stockholders with respect to the Transaction Proposal. If HACII, the Initial Stockholders or HACII’s officers and directors purchase Public Shares from existing HACII Public Stockholders that are likely to vote against the Transaction Proposal or that are likely to elect to exercise their redemption rights, the probability that the vote to approve the Transaction Proposal will succeed would increase.

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Any request for redemption, once made, may be withdrawn at any time up to the date of the special meeting of HACII stockholders. The actual per share redemption price will be equal to the aggregate amount then on deposit in the trust account (before payment of deferred underwriting commissions and including interest earned on their pro rata portion of the trust account, net of franchise and income taxes payable on such interest and net of interest income of up to approximately $2.25 million on the trust account, which interest income was previously released to HACII to fund its working capital requirements) divided by the number of shares sold in the IPO. For illustrative purposes, based on funds in the trust account of approximately $149.3 million on March 31, 2012, the estimated per share redemption price would have been approximately $9.95. Please see the section entitled “ Special Meetings of HACII Public Warrantholders and HACII Stockholders—Redemption Rights ” for the procedures to be followed if you wish to redeem your Public Shares for cash.

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If HACII does not consummate an initial business combination by July 14, 2012, it will be required to commence proceedings to dissolve and liquidate and HACII’s warrants will expire worthless. HACII warrantholders have no right to receive funds held in the trust account with respect to the warrants they hold.

The Initial Stockholders have waived their redemption rights with respect to their Founder Shares if HACII fails to consummate a business combination by July 14, 2012.

Thomas O. Hicks, HACII’s founder and chairman of the board, has agreed that upon HACII’s liquidation, he will be liable to HACII if and to the extent any claims by a vendor for services rendered or products sold to HACII, or a prospective target business with which HACII has discussed entering into a transaction agreement, reduce the amounts in the trust account to below $9.95 per share, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under HACII’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, Mr. Hicks will not be responsible to the extent of any liability for such third party claims. However, HACII has not asked Mr. Hicks to reserve for such indemnification, and HACII cannot assure you that Mr. Hicks would be able to satisfy those obligations. See the section entitled “ HACII’s Business—Liquidation if No Business Combination ” for additional information.

If HACII does not consummate an initial business combination by July 14, 2012, it will be required to commence proceedings to dissolve and liquidate and HACII’s warrants will expire worthless. See the section entitled “ HACII’s Business—Liquidation if No Business Combination ” for additional information.

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An abstention from the Warrant Amendment Proposal and the Warrantholder Adjournment Proposal presented to HACII Public Warrantholders will have the same effect as a vote “AGAINST” this proposal.

Stockholders will not be entitled to exercise their redemption rights if such stockholders submit proxy cards to HACII without an election on the proxy card to redeem their shares or, for stockholders holding their shares in “street name,” if such stockholders fail to provide appropriate instructions to their banks, brokers or other nominees.

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Thomas O. Hicks, Jr., Secretary

100 Crescent Court, Suite 1200

Dallas, Texas 75201

Tel: (214) 615-2300

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To obtain timely delivery, HACII stockholders and HACII Public Warrantholders must request the materials no later than                 , 2012.

You may also obtain additional information about HACII from documents filed with the Securities and Exchange Commission, by following the instructions in the section entitled “ Where You Can Find Additional Information .”

If you intend to seek redemption of your Public Shares, you will need to deliver your shares (either physically or electronically) to HACII’s transfer agent prior to the meeting, as further described in this proxy statement. If you have questions regarding the certification of your position or delivery of your shares, please contact:

Continental Stock Transfer & Trust Company

17 Battery Place

New York, New York 10004

Tel: (212) 845-3287

Fax: (212) 616-7616

DELIVERY OF DOCUMENTS TO STOCKHOLDERS

Pursuant to the rules of the SEC, HACII and services that it employs to deliver communications to its stockholders are permitted to deliver to two or more stockholders sharing the same address a single copy of the proxy statement, unless HACII has received contrary instructions from one or more of such stockholders. Upon written or oral request, HACII will deliver a separate copy of the proxy statement to any stockholder at a shared address to which a single copy of the proxy statement was delivered and who wishes to receive separate copies in the future. Stockholders receiving multiple copies of the proxy statement may likewise request that HACII deliver single copies of the proxy statement in the future. Stockholders may notify HACII of their requests by calling HACII at (214) 615-2300 or writing HACII at its principal executive offices at 100 Crescent Court, Suite 1200, Dallas, Texas 75201.

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RISK FACTORS

You should consider carefully the following risk factors, as well as the other information set forth in this proxy statement, before making a decision on the Transaction or the other proposals presented. As HACII’s operations will be those of Appleton upon completion of the Transaction, a number of the following risk factors relate to the business and operations of HACII and Appleton, as a non-wholly-owned subsidiary of HACII. The market value of your shares will reflect the performance of the business relative to, among other things, that of the competitors of Appleton and general economic, market and industry conditions. The value of your investment may increase or may decline and could result in a loss. You should carefully consider the following factors as well as the other information contained in this proxy statement. In particular, you should consider the risks related to potential conflicts of interest disclosed on pages 34-35.

Risk Factors Related to HACII and the Transaction

Since the Initial Stockholders will lose their entire investment in HACII if a business combination is not consummated, a conflict of interest may arise in determining whether the Transaction is appropriate for HACII’s initial business combination.

On June 15, 2010, the Sponsor purchased 3,285,714 Founder Shares for an aggregate purchase price of $25,000, or approximately $0.0076 per share. On July 8, 2010, the Sponsor transferred an aggregate of 32,856 Founder Shares to William A. Montgomery and William F. Quinn, each of whom joined HACII’s board of directors upon the closing of the IPO. On October 8, 2010, the Sponsor, and Messrs. Montgomery and Quinn returned an aggregate of 821,428 of their Founder Shares to HACII for no consideration in connection with a reduction in the number of units to be offered in the IPO. In addition, the Sponsor, and Messrs. Montgomery and Quinn returned an aggregate of 321,429 Founder Shares to HACII for no consideration after the underwriters of the IPO determined that they would not exercise their option to purchase additional units to cover any over-allotments. On January 13, 2012, the Sponsor transferred 10,714 Founder Shares to James C. Musselman in connection with Mr. Musselman’s appointment to HACII’s board of directors. A portion of the Founder Shares (equal to 2.5% of the issued and outstanding shares of HACII Common Stock immediately after the IPO) will be subject to forfeiture by the Initial Stockholders in the event the last sales price of HACII Common Stock does not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period within 24 months following the closing of HACII’s initial business combination.

The Founder Shares held by the Initial Stockholders will be worthless if HACII does not consummate a business combination by July 14, 2012, which is the date that is 21 months after the closing of the IPO. The Sponsor has also purchased 6,666,667 Sponsor Warrants, each exercisable for one share of HACII Common Stock at $12.00 per share, for a purchase price of $5.0 million, or $0.75 per warrant, that will also be worthless if HACII does not consummate a business combination by July 14, 2012. The personal and financial interests of these directors and officers of HACII may have influenced their motivation in timely identifying and selecting a target business and completing a business combination. Consequently, the discretion of these officers and directors in identifying and selecting Appleton as HACII’s target business may have resulted in a conflict of interest when determining whether the terms, conditions and timing of the Transaction are appropriate and in HACII stockholders’ best interests.

Activities taken by HACII to utilize a portion of the funds in the trust account to purchase, directly or indirectly, Public Shares will increase the likelihood of approval of the Transaction Proposal and other proposals.

At any time prior to the special meeting, during a period when they are not then aware of any material nonpublic information regarding HACII or its securities, HACII, the Initial Stockholders or HACII’s directors, officers, advisors and their respective affiliates may privately negotiate transactions to purchase Public Shares

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after the closing of the Transaction from stockholders who would have otherwise elected to have their shares redeemed in conjunction with a proxy solicitation pursuant to the proxy rules.

Such a purchase would include a contractual acknowledgement that such selling stockholder, although still the record holder of the shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that HACII, the Initial Stockholders or HACII’s directors, officers, advisors or their respective affiliates purchase shares in privately negotiated transactions from HACII Public Stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. Although it is not anticipated that a premium purchase price would be paid for such Public Shares, in the event that it is, such payment of a premium purchase price may not be in the best interests of those stockholders not receiving any such additional consideration. In the event that HACII is the buyer in such privately negotiated purchases, trust account proceeds could be used to pay the purchase price in such transactions after the closing of the Transaction.

In addition, HACII may make purchases of Public Shares, in an amount up to 15% of the Public Shares (2,250,000 shares), in the open market in a manner intended to comply with Rule 10b-18 under the Exchange Act, using funds held in the trust account so long as the price paid for such shares (inclusive of commissions) does not exceed the per-share amount then held in the trust account.

The purpose of such purchases would be to increase the likelihood of obtaining stockholder approval of the Transaction or, where the purchases are made by Initial Stockholders or HACII’s directors, officers, advisors or their respective affiliates, to satisfy a closing condition in an agreement with a target that requires HACII to have a minimum net worth or a certain amount of cash at the closing of the business combination, where it appears that such requirement would otherwise not be met. This may result in the consummation of the Transaction, which may not otherwise have been possible. In addition, purchases in the open market would provide liquidity to HACII Public Stockholders in advance of the closing of the Transaction. See the section entitled “ The Transaction—Actions That May Be Taken to Secure Approval of HACII Stockholders .”

HACII may not be able to consummate a business combination within the prescribed time frame, in which case HACII’s corporate existence will cease all operations except for the purpose of winding up, redeeming the Public Shares and liquidating.

The Sponsor and HACII’s officers and directors have agreed that HACII must complete an initial business combination by July 14, 2012, which is the date that is 21 months after the closing of the IPO. If HACII fails to consummate an initial business combination within such time frame, HACII will:

subject in each case to HACII’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

The foregoing requirements are set forth in Article IX of the HACII charter and may not be eliminated without the vote of 65% of the outstanding shares of HACII Common Stock cast at a meeting of the stockholders at which a quorum is present.

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If HACII is unable to complete an initial business combination within the prescribed time frame, HACII Public Stockholders may receive less than $10.00 per Public Share on its redemption, and the HACII warrants will expire worthless.

If HACII is unable to complete an initial business combination within the prescribed time frame and is forced to cease operations and ultimately liquidate, the per-share redemption amount received by HACII Public Stockholders may be less than $10.00 because of the expenses of the IPO, its general and administrative expenses and the anticipated costs of seeking its initial business combination. If HACII is unable to conclude its initial business combination and expend all of the net proceeds of the IPO, other than the proceeds deposited in the trust account, and without taking into account interest, if any, earned on the trust account, net of franchise and income taxes payable and net of up to $2.25 million in interest income on the trust account balance previously released to fund HACII’s working capital requirements, the per-share redemption amount received by HACII Public Stockholders would be $9.95 per Public Share, or $0.05 less than the per-unit offering price of $10.00. Furthermore, HACII’s warrants are not entitled to participate in a liquidating distribution and the warrants will therefore expire worthless if HACII liquidates before completing the Transaction.

If HACII is unable to consummate its initial business combination within the prescribed time frame, HACII Public Stockholders will be forced to wait, at a minimum, until July 14, 2012 before receiving distributions from the trust account.

HACII has until July 14, 2012, which is the date that is 21 months after the closing of the IPO, to consummate its initial business combination. If HACII fails to consummate an initial business combination during such time frame, it will cease all operations except for the purpose of winding up, redeem the Public Shares, and dissolve and liquidate. If HACII’s plan to redeem the Public Shares is not consummated for any reason, compliance with Delaware law may require that HACII submit a plan of dissolution to its then-existing stockholders for approval prior to the distribution of the proceeds held in the trust account. In that case, HACII Public Stockholders may be forced to wait beyond July 14, 2012 before receiving the return of a pro rata portion of the proceeds from the trust account. Except for the above redemption, HACII has no obligation to return funds to the HACII Public Stockholders prior to the date of its liquidation unless it consummates an initial business combination prior thereto and only then in cases where stockholders have sought to redeem their shares

The ability of HACII Public Stockholders to exercise redemption rights may not allow HACII to consummate the Transaction.

The funds released from the trust account to HACII upon consummation of the Transaction will be used to pay (i) HACII’s aggregate costs, fees and expenses in connection with the consummation of an initial business combination and other working capital expenses, (ii) tax obligations and deferred underwriting commissions, (iii) the Cash Amount payable to HACII Public Warrantholders, (iv) HACII Public Stockholders who properly exercise their redemption rights, and (v) for any repurchases by HACII of Public Shares prior to the closing of the Transaction. The remaining balance in the trust account will be contributed to Appleton in exchange for HACII’s receipt of membership interests in Appleton in connection with the Transaction. Pursuant to the terms of the Equity Purchase Agreement, HACII shall not redeem or repurchase Public Shares to the extent such redemption would result in HACII’s failure to meet a closing condition under the Equity Purchase Agreement that it have at least $82.0 million in trust proceeds after giving effect to the Redemption but prior to the payment of the Cash Amount, expenses and certain other amounts. It is not known at this time how many HACII Public Stockholders will exercise their redemption rights. If a larger percentage of HACII Public Stockholders exercise their redemption rights than is expected, HACII may not be able to consummate the Transaction.

If HACII’s due diligence investigation of Appleton was inadequate, then stockholders of HACII following the Transaction could lose some or all of their investment.

Even though HACII conducted a due diligence investigation of Appleton, it cannot be sure that this diligence uncovered all material issues that may be present inside Appleton or its business, or that it would be

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possible to uncover all material issues through a customary amount of due diligence, or that factors outside of Appleton and its business and outside of its control will not later arise.

If the Transaction is not consummated, HACII will have limited time and resources to consummate a different business transaction.

HACII has until July 14, 2012, which is the date that is 21 months after the closing of the IPO, to complete an initial business transaction. If HACII is unable to consummate the Transaction, its ability to consummate a different business transaction may be adversely impacted. For example, HACII may not have adequate time to identify another target, perform due diligence, negotiate a definitive agreement related to the business combination and consummate the business combination prior to July 14, 2012. Additionally, HACII would have less funds at its disposal to pay for the costs associated with consummating a different business combination. Consequently, if HACII does not consummate the Transaction, it may not be able to consummate a different business combination before July 14, 2012.

If third parties bring claims against HACII, the proceeds held in the trust account could be reduced and the per-share redemption amount received by its stockholders may be less than approximately $9.95 per Public Share.

The funds in the trust account may not be protected against third party claims against HACII. Although HACII has received from many of the vendors, service providers (other than its independent accountants), prospective target businesses or other entities with which it does business executed agreements waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of HACII Public Stockholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as other claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against HACII’s assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account in the future, HACII’s management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to HACII than any alternative.

Upon redemption of the Public Shares, if HACII is unable to complete a business combination within the required time frame, or upon the exercise of a redemption right in connection with a business combination, HACII will be required to provide for payment of claims of creditors that were not waived that may be brought against it within the 10 years following redemption. Accordingly, the per-share redemption amount received by stockholders could be less than the $9.95 per share held in the trust account, including interest but net of any franchise and income taxes payable and less up to $100,000 of such net interest that may be released to HACII from the trust account to pay dissolution expenses due to claims of such creditors. Mr. Hicks, HACII’s founder and chairman of the board, has agreed that upon HACII’s liquidation, he will be liable to HACII if and to the extent any claims by a vendor for services rendered or products sold to HACII, or a prospective target business with which HACII has discussed entering into a transaction agreement, reduce the amounts in the trust account to below $9.95 per share, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under HACII’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third party, Mr. Hicks will not be responsible to the extent of any liability for such third party claims. HACII cannot assure you, however, that Mr. Hicks would be able to satisfy those obligations. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, Mr. Hicks will not be responsible to the extent of any liability for such third party claims. However, HACII has not asked Mr. Hicks to reserve for such indemnification obligations and HACII cannot assure you that Mr. Hicks would be able to satisfy those obligations.

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HACII stockholders may be held liable for claims by third parties against HACII to the extent of distributions received by them.

Under Sections 280 through 282 of the Delaware General Corporation Law of the State of Delaware, or the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of the trust account distributed to HACII Public Stockholders upon the redemption of 100% of the Public Shares in the event HACII does not consummate an initial business combination by July 14, 2012 may be considered a liquidation distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. However, it is HACII’s intention to redeem the Public Shares as soon as reasonably possible after July 14, 2012 in the event that it does not consummate an initial business combination; and therefore, HACII does not intend to comply with those procedures.

Because HACII will not be complying with Section 280, Section 281(b) of the DGCL requires HACII to adopt a plan, based on facts known to it at such time that will provide for payment of all existing and pending claims or claims that may be potentially brought against HACII within the 10 years following its dissolution. However, because HACII is a blank check company rather than an operating company, and its operations are limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from its vendors (such as lawyers, investment bankers, etc.) or prospective target businesses. If HACII’s plan of distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution. HACII cannot assure its stockholders that it will properly assess all claims that may be potentially brought against it. As such, HACII’s stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and their liability may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of the trust account distributed to HACII Public Stockholders upon the redemption of 100% of the Public Shares in the event HACII does not consummate its initial business combination by July 14, 2012 is not considered a liquidation distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidation distribution.

In certain circumstances, HACII’s board of directors may be viewed as having breached its fiduciary duty to HACII’s creditors, thereby exposing the board and HACII to claims of punitive damages.

If HACII files a bankruptcy petition or an involuntary bankruptcy petition is filed against HACII that is not dismissed, any distributions received by HACII Public Stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover all amounts received by HACII Public Stockholders. Furthermore, because HACII intends to redeem the Public Shares for a per-share pro rata portion of the trust account in the event that it does not consummate a business combination by July 14, 2012, this may be viewed or interpreted as giving preference to the HACII Public Stockholders over any potential creditors with respect to access to or distributions from HACII’s assets. Furthermore, HACII’s board of directors may be viewed as having breached its fiduciary duty to HACII’s creditors and/or having acted in bad faith, thereby exposing itself and HACII to claims of punitive damages, by paying HACII Public Stockholders from the trust account prior to addressing the claims of creditors. To the extent any bankruptcy claims deplete the trust account, HACII cannot assure its stockholders that it will be able to return to HACII Public Stockholders the redemption amounts described in this proxy statement.

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If HACII is deemed to be an investment company under the Investment Company Act, HACII may be required to institute burdensome compliance requirements and HACII’s activities may be restricted, which may make it difficult to complete the Transaction.

If HACII is deemed to be an investment company under the Investment Company Act of 1940, or the Investment Company Act, its activities may be subject to certain restrictions, including:

each of which may make it difficult for HACII to complete the Transaction.

In addition, HACII may have imposed upon it burdensome requirements, including:

HACII does not believe that its principal activities subject it to the Investment Company Act. The proceeds held in the trust account may be invested by the trustee only in U.S. government treasury bills with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act. Because the investment of the proceeds is restricted to these instruments, HACII believes that it meets the requirements for the exemption provided in Rule 3a-1 promulgated under the Investment Company Act. If HACII were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which HACII has not allotted funds and may hinder HACII’s ability to consummate the Transaction. If HACII is unable to complete its initial business combination by July 14, 2012, HACII Public Stockholders may receive less than $10.00 per Public Share on HACII’s redemption, and HACII’s warrants will expire worthless.

Changes in laws or regulations, or failure to comply with any laws and regulations, may adversely affect HACII’s business, investments and results of operations.

HACII is subject to laws and regulations enacted by national, regional and local governments. In particular, HACII will be required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on HACII’s business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, by any of the persons referred to above could have a material adverse effect on HACII’s business and results of operations.

HACII is dependent upon Mr. Hicks, and his loss could adversely affect HACII’s ability to operate.

HACII’s operations are dependent upon a relatively small group of individuals and, in particular, upon its founder and chairman of the board, Mr. Hicks. HACII believes that its success depends on the continued service of Mr. Hicks, at least until it has consummated the Transaction. In addition, Mr. Hicks is not required to commit any specified amount of time to HACII’s affairs and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. HACII does not have an employment agreement with, or key-man insurance on the life of, Mr. Hicks. The unexpected loss of the services of Mr. Hicks could have a detrimental effect on HACII.

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The Sponsor, which is an entity controlled by Thomas O. Hicks, HACII’s founder and chairman of the board, controls a substantial interest in HACII and thus may influence certain actions requiring a stockholder vote.

The Sponsor, an entity controlled by Thomas O. Hicks, HACII’s founder and chairman of the board, owns 12.313% of the issued and outstanding shares of HACII Common Stock. Accordingly, the Sponsor will continue to exert control at least until the consummation by HACII of the Transaction. In the event the Initial Stockholders purchase any additional shares of HACII Common Stock, they will vote any such shares acquired by them in favor of the Transaction. Furthermore, in the event that Mr. Hicks acquires Public Shares, HACII anticipates that he would vote such shares in favor of the Transaction. Thus, additional purchases of Public Shares by the Initial Stockholders or Mr. Hicks would likely allow them to exert additional influence over the approval of the Transaction Proposal. Factors that would be considered in making such additional purchases would include consideration of the current trading price of HACII Common Stock. Another factor that would be taken into consideration would be that any such additional purchases would likely increase the chances that HACII’s initial business combination would be approved.

HACII has not registered the shares of common stock issuable upon exercise of the HACII Public Warrants. Although HACII has agreed to use its best efforts to file a registration statement registering such shares prior to the time the HACII Public Warrants become exercisable, an effective registration statement may not be in place when an investor desires to exercise such warrants, thus precluding such investor from being able to exercise the warrants and causing such warrants to expire worthless.

None of the HACII Public Warrants will be exercisable, and HACII will not be obligated to issue shares of HACII Common Stock, unless, at the time of exercise, a prospectus relating to the HACII Common Stock issuable upon exercise of the HACII Public Warrants is current and available and a related registration statement is effective and such common stock has been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder of the HACII Public Warrants. HACII has not registered the shares of HACII Common Stock issuable upon exercise of the HACII Public Warrants. However, under the terms of the warrant agreement governing such warrants, HACII has agreed to use its best efforts to file a registration statement covering such shares and maintain a current prospectus relating to the HACII Common Stock issuable upon exercise of the HACII Public Warrants until the expiration of such warrants. HACII cannot assure holders of HACII Public Warrants that it will be able to do so, and if it does not maintain a current prospectus related to the HACII Common Stock issuable upon exercise of the HACII Public Warrants, holders will be unable to exercise their warrants, except pursuant to cashless exercise provisions in limited circumstances. HACII will not be required to settle any such warrant exercise. If the registration statement is not effective or the prospectus relating to the HACII Common Stock issuable upon the exercise of the HACII Public Warrants is not current or if such common stock is not qualified or exempt from qualification in the jurisdiction in which a holder resides, HACII will not be required to net cash settle or cash settle the warrant exercise, the HACII Public Warrants may have no value, the market for the HACII Public Warrants may be limited and the HACII Public Warrants may expire worthless.

HACII may redeem the HACII Public Warrants prior to their exercise at a time that is disadvantageous to warrant holders, thereby making their warrants worth less.

HACII has the ability to redeem the outstanding HACII Public Warrants at any time after they become exercisable (which would not be before 30 days after the consummation of the Transaction) and prior to their expiration at a price of $0.01 per warrant, provided that (i) the last reported sale price of HACII Common Stock equals or exceeds $18.00 per share for any 20 trading days within the 30 trading-day period ending on the third business day before HACII sends the notice of such redemption and (ii) on the date HACII gives notice of redemption and during the entire period thereafter until the time the warrants are redeemed, there is an effective registration statement under the Securities Act covering the shares of HACII Common Stock issuable upon exercise of the HACII Public Warrants and a current prospectus relating to them is available. Redemption of the outstanding HACII Public Warrants could force holders of HACII Public Warrants:

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None of the Sponsor Warrants will be redeemable by HACII so long as they are held by the Sponsor or its permitted transferees.

Certain members of HACII’s management team and board are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those conducted by HACII and may consider transactions with entities reviewed by HACII as possible targets.

Certain members of HACII’s management team and board are, and may in the future, become affiliated with entities engaged in business activities similar to those conducted by HACII and may consider transactions with entities reviewed by HACII as possible targets. As a result, HACII’s officers or directors or their affiliates might pursue acquisitions with businesses that were considered by HACII as possible targets.

The price of HACII Common Stock after the consummation of the Transaction may be volatile.

The price of HACII Common Stock after the consummation of the Transaction may be volatile, and may fluctuate due to factors such as:

HACII may waive one or more of the conditions to the closing of the Transaction without resoliciting stockholder approval for the Transaction.

Both Appleton and HACII may agree to waive, in whole or in part, some of the conditions to its obligations to complete the Transaction, to the extent permitted by applicable laws. HACII’s board of directors will evaluate the materiality of any waiver to determine whether amendment of this proxy statement and resolicitation of proxies is warranted. In some instances, if HACII’s board of directors determines that a waiver is not sufficiently material to warrant resolicitation of stockholders, HACII has the discretion to complete the Transaction without seeking further stockholder approval. Any supplemental disclosure would be provided via means of a press release issued by HACII, the filing of related disclosure on Form 8-K, and a supplement to this proxy statement. Such supplemental disclosure would state in bold face prominent text that stockholders or warrantholders would be able to revoke any votes that had been cast by them up to the time of the meeting and would contain equally prominent notice that any such votes may be revoked by following telephone and/or Internet voting procedures provided by banks or brokers prior to 11:59 P.M. Eastern Daylight Time on the day before the special meetings. Such supplemental disclosure would be issued at a minimum of two business days prior to any vote on the matters addressed in this proxy statement (other than votes on adjournment proposals), although it would be unlikely that any such supplement to this proxy statement would be received by the stockholders or warrantholders prior to such vote if it was mailed only two business days prior to the relevant vote.

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In the event that there was a waiver of any particular condition that would be sufficiently material to warrant supplemental disclosure within two business days of the relevant vote (i.e., on or after 11:59 P.M. Eastern Daylight Time on                 , 2012), supplemental disclosure would be issued but HACII would adjourn the meeting until the second business day following the supplemental disclosure; provided that in no event would the special meetings be adjourned to a date past July 14, 2012.

A waiver of one closing condition in particular may adversely affect the ability of HACII to remain listed on the Nasdaq Capital Market.

There is currently a closing condition that requires there to be $82.0 million of cash held in trust, after giving effect to the Redemption and certain permitted repurchases of Public Shares but prior to the payment of the Cash Amount, expenses and certain other amounts. In the event that this closing condition is waived and the Transaction does not qualify for purchase accounting treatment, HACII could face delisting proceedings from the Nasdaq Capital Market due to the failure to maintain required levels of stockholder equity that the $82.0 million closing condition is designed to address.

The Nasdaq Capital Market may delist HACII’s securities from trading on its exchange in the future, which could limit investors’ ability to make transactions in its securities and subject HACII to additional trading restrictions.

HACII’s securities are currently listed on the Nasdaq Capital Market in accordance with the requirements of that exchange. There can be no assurance that HACII will be able to maintain such listing. If the Nasdaq Capital Market delists HACII’s securities from trading on its exchange in the future, HACII could face significant material adverse consequences, including:

Compliance with the Sarbanes-Oxley Act of 2002 will require substantial financial and management resources both before and after consummation of the Transaction.

Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, required that HACII evaluate and report on its system of internal controls and required that HACII have such system of internal controls audited beginning with its Annual Report on Form 10-K for the year ending December 31, 2011. If HACII fails to maintain the adequacy of its internal controls, it could be subject to regulatory scrutiny, civil or criminal penalties and/or stockholder litigation. Any inability to provide reliable financial reports could harm HACII’s business. Section 404 of the Sarbanes-Oxley Act also requires that HACII’s independent registered public accounting firm report on management’s evaluation of HACII’s system of internal controls. The development of the internal controls in order to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete the Transaction. Furthermore, any failure to implement required new or improved controls, or difficulties encountered in the implementation of adequate controls over its financial processes and reporting in the future, could harm HACII’s operating results or cause HACII to fail to meet its reporting obligations. Inferior internal controls could also cause investors to lose confidence in HACII’s reported financial information, which could have a negative effect on the trading price of the shares of HACII Common Stock.

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After consummation of the Transaction, HACII will be a holding company that relies on dividends, distributions, loans and other payments, advances and transfers of funds from Appleton to pay dividends, pay expenses and meet its other obligations.

After consummation of the Transaction, HACII will have no direct operations and no significant assets other than ownership of all the Appleton Class A Units. HACII will depend on Appleton for dividends, distributions, loans and other payments to generate the funds necessary to meet its financial obligations, including payments under the Tax Receivable Agreement entered into by and among HACII and PDC in connection with the Transaction, and its expenses as a publicly traded company, and to pay any dividends with respect to HACII Common Stock. The Appleton LLC Agreement will provide that all proceeds of any issuance by HACII of securities are, subject to certain exceptions, required to be contributed or otherwise provided to Appleton and, pursuant to an Exchange Agreement among HACII and PDC that will be entered into in connection with the Transaction, HACII will generally prohibited from conducting operations outside those activities related to its role as a publicly traded holding company owning the Appleton Class A Units. In addition, HACII will generally be required to reserve excess cash generated from tax distributions from Appleton for the purpose of providing additional working capital to Appleton. Legal and contractual restrictions in agreements governing future indebtedness of Appleton and its subsidiaries, as well as the financial condition and operating requirements of Appleton and its subsidiaries, may limit HACII’s ability to obtain cash from its subsidiaries. The earnings from, or other available assets of, Appleton may not be sufficient to make distributions or loans to enable HACII to pay any dividends on its common stock or satisfy its other financial obligations. HACII’s ability to pay cash dividends to holders of common stock, or satisfy its operating expenses and/or other financial obligations, may be limited by the terms of the Appleton LLC Agreement, which will generally require distributions by Appleton to be pro rata to all its members, including HACII and the holders of Appleton Class B Units, except in the case of distributions for public company expenses.

PDC will receive payments for certain tax benefits that HACII may claim arising in connection with the Transaction and related transactions, and the amounts HACII may pay could be significant.

In connection with the Transaction, HACII will enter into the Tax Receivable Agreement with PDC that provides for the payment by HACII to PDC of 85% of the tax benefits, if any, that HACII realizes (or in certain circumstances is deemed to realize) from additional deductions and tax basis it will be entitled to as a result of the Transaction, exchanges of Appleton Class B Units for HACII Common Stock, and payments under the Tax Receivable Agreement. It is expected that the payments that HACII is obligated to make under the Tax Receivable Agreement could be substantial.

Future payments to PDC in respect of subsequent exchanges of Appleton Class B Units for HACII Common Stock would be in addition to this initial amount and are expected to be substantial as well. It is possible that future transactions or events could increase or decrease the actual tax benefits realized and the corresponding Tax Receivable Agreement payments. There may be a material negative effect on HACII’s liquidity if, as a result of timing discrepancies or otherwise, the payments under the Tax Receivable Agreement exceed the actual benefits HACII realizes in respect of the tax attributes subject to the Tax Receivable Agreement.

Appleton Class B Units will be issued in connection with the Transaction and when exchanged for HACII Common Stock will become eligible for future resale in the public market, which will result in substantial dilution and could have an adverse effect on the market price of those shares.

Upon consummation of the Transaction, 9,632,024 Appleton Class B Units will be issued to PDC (either directly or through a wholly-owned subsidiary), which would (if fully exchanged) represent approximately 34.5% of the outstanding shares of HACII Common Stock on a fully diluted basis (assuming no redemptions or repurchases and no issuance of Contingency Consideration and exclusive of any stock-based awards that may be granted under the Incentive Plan).

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The sale or availability for sale of substantial amounts of shares of HACII Common Stock could cause the price of HACII Common Stock to decline.

Upon the consummation of the Transaction, PDC (either directly or through a wholly-owned subsidiary) will acquire certain securities which will be convertible into HACII Common Stock. In the future, such shares may be sold from time to time in the public market pursuant to the registration rights to be granted in connection with the Transaction or pursuant to Rule 144. Such sales may commence upon effectiveness of the shelf registration statement. The sale of these shares or the availability for future sale of these shares could adversely affect the market price of HACII Common Stock and could impair the future ability of HACII to raise capital through offerings of HACII Common Stock.

The financial statements included in this proxy statement do not take into account the consequences to HACII of a failure to consummate a business combination by July 14, 2012.

The financial statements included in this proxy statement have been prepared assuming that HACII would continue as a going concern. HACII is required to consummate an initial business combination by July 14, 2012. The possibility of the Transaction not being consummated raises substantial doubt as to HACII’s ability to continue as a going concern and the financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Unlike many other blank check companies, HACII does not have a specified maximum redemption threshold contained in its charter. The absence of such a redemption threshold will make it easier for HACII to consummate a business combination with which a substantial majority of the HACII Public Stockholders do not agree.

Since HACII has no specified maximum redemption threshold contained in its charter, its structure is different in this respect from the structure that has been used by many other blank check companies. Traditionally, blank check companies would not be able to consummate a business combination if the holders of the company’s public shares voted against a proposed business combination and elected to redeem or convert more than a specified percentage of the shares sold in such company’s initial public offering, which percentage threshold is typically between 19.99% and 39.99%. As a result, many blank check companies have been unable to complete business combinations because, among other reasons, the number of shares voted by their public stockholders electing conversion exceeded the maximum conversion threshold pursuant to which such company could proceed with a business combination. As a result, HACII may be able to consummate a business combination even though a substantial majority of HACII Public Stockholders do not agree with the transaction and have redeemed their shares or, if HACII has entered into privately negotiated agreements to sell their shares to HACII, the Initial Stockholders or HACII’s officers, directors, advisors or their affiliates. In no event, however, will HACII redeem the Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001 or that would result in HACII’s failure to meet a closing condition under the Equity Purchase Agreement that it have at least $82.0 million in trust proceeds after giving effect to the Redemption and/or any permitted repurchases but prior to the payment of the Cash Amount, expenses and certain other amounts. If accepting all properly submitted redemption requests would cause HACII’S net tangible assets to be less than $5,000,001 or cause HACII to fail to meet such closing condition under the Equity Purchase Agreement, it would not proceed with such redemption and the related business combination and may instead search for an alternate business combination. However, Appleton has the ability to waive the closing condition under the Equity Purchase Agreement relating to the $82.0 million in trust proceeds.

Appleton’s outstanding debt instruments constrain Appleton’s ability to consummate the Transaction.

Appleton’s current outstanding debt instruments constrain Appleton’s activities, including certain rights that would be triggered upon consummation of the Transaction. In connection with Appleton’s entry into the Equity Purchase Agreement, Appleton has agreed as a condition to the closing of the Transaction to solicit certain amendments to or waivers from its current outstanding debt instruments in order to permit the consummation of the Transaction. Any failure or delay in securing such amendments or waivers could delay or prevent the consummation of the Transaction. We expect that HACII will have to co-guarantee certain of Appleton’s outstanding indebtedness in order to obtain amendments to the debt instruments governing such indebtedness to complete the Transaction.

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Risks Related to Appleton’s Business, Operations and Industry

Appleton is subject to substantial costs and potential liabilities relating to environmental regulation and litigation.

Appleton is subject to stringent and complex federal, state and local laws and regulations governing environmental protection, the protection of public health and safety, as well as the discharge of materials into the environment. The clear trend in environmental regulation is to place more restrictions and limitations on activities that may affect the environment, and thus any changes in environmental laws and regulations or re-interpretation of enforcement policies that result in more stringent and costly waste handling, storage, transport, disposal, or remediation requirements could have a material adverse effect on Appleton’s financial position and results of operations. Appleton may be unable to pass on any such increased compliance costs to its customers. Moreover, accidental releases or spills may occur in the course of its operations, and it may incur significant costs and liabilities as a result of any such releases or spills, including third-party claims for damage to property, natural resources or persons.

Appleton makes capital expenditures and incurs operating expenses for environmental obligations and matters arising from its daily operations. In addition, Appleton accrues liabilities to account for costs associated with known environmental conditions, but the amounts accrued may be inadequate. Appleton expects environmental laws and regulations and the interpretation and enforcement of those laws and regulations to become increasingly stringent and to further limit emission and discharge levels and to increase the likelihood and cost of environmental cleanups and related activities. All of these factors are likely to increase Appleton’s operating expenses, require continuing capital expenditures and adversely affect the operating flexibility of its manufacturing operations and may require indeterminable and significant additional expenditures in connection with such compliance.

Appleton was previously named as a potentially responsible party under CERCLA related to the Lower Fox River Superfund Site.

The Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, also known as the “Superfund” law, and comparable state laws impose strict and joint and several liability, without regard to fault or legality of the original conduct, on classes of persons considered to be responsible for the release of a “hazardous substance” into the environment. These persons include the current owner or operator of the site where the release occurred, prior owners or operators that owned or operated the site at the time of the release or disposal of hazardous substances and anyone who disposed or arranged for the disposal of a hazardous substance released at the site. Under CERCLA and comparable state statutes, such persons deemed “responsible parties” may be subject to joint and several and strict liability for removing or remediating previously disposed wastes (including wastes disposed of or released by prior owners or operators) or property contamination (including groundwater contamination), for damages to natural resources and for the costs of certain health studies. In addition, it is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damage allegedly caused by the hazardous substances released into the environment. As described in the following risk factor, Appleton was previously identified as a potentially responsible party, or a PRP, under CERCLA for remediation of polychlorinated biphenyl, or PCB, contamination and alleged natural resources damages related to the Lower Fox River and Green Bay system, which is collectively referred to in this proxy statement as the Lower Fox River.

On July 28, 1998, the United States Environmental Protection Agency, or the EPA, placed the Lower Fox River on the National Priorities List of Contaminated Sites pursuant to CERCLA. Appleton was named a PRP with respect to historic discharges of PCBs into the Lower Fox River. Carbonless paper containing PCBs was manufactured at what is currently the Appleton plant from 1954 until 1971. During this period, wastewater containing PCBs was discharged into the Lower Fox River from a publicly-owned treatment works, from the Appleton plant, from the Combined Locks, Wisconsin paper mill and from other local industrial facilities. Wastewater from the Appleton plant was processed through the publicly-owned treatment works. Appleton purchased the Appleton plant and the Combined Locks, Wisconsin paper mill from NCR Corporation, or NCR, in 1978, long after discovery of the use of PCBs in the manufacturing process. The EPA issued an administrative order in November 2007, directing the PRPs to implement the remedial action of the Lower Fox River pursuant to which

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certain of the PRPs commenced remediation in 2008. The EPA, Wisconsin Department of Natural Resources, or the DNR, and the various PRPs, including NCR, continue to contest the scope, extent and costs of the remediation as well as the appropriate bases for determining the individual parties’ relative share of the remediation cost. Appleton has continuously maintained the EPA erred in naming it a PRP. On April 10, 2012, the United States District Court for the Eastern District of Wisconsin agreed and granted Appleton’s motion for summary judgment and dismissed all claims against it in the enforcement action, U.S. v. NCR Corporation et al. , Case. No. 10-C-910. The decision establishes that Appleton is no longer a PRP, no longer liable under CERCLA, no longer considered a legal successor to NCR’s liabilities, and no longer required to comply with the 106 Order commanding remediation of the Lower Fox River.

Notwithstanding the April 10, 2012 ruling, Appleton remains obligated to share in a significant portion of NCR’s joint defense and liability costs in accordance with the terms of a 1998 settlement agreement and a 2006 arbitration determination, collectively known as the Cost Sharing Agreements, arising out of Appleton’s acquisition of assets from NCR in 1978 while it was a subsidiary of B.A.T Industries Limited, or BAT. Appleton and BAT have joint and several liability under the Cost Sharing Agreements. Since NCR remains a PRP, Appleton stands to bear financial responsibility for a significant portion of NCR’s costs of remediating the PCBs that remain in the Lower Fox River. Indeed, on April 27, 2012, the U.S. District Court for the Eastern District of Wisconsin issued a preliminary injunction requiring NCR immediately to resume remediation of the Lower Fox River and to dredge at least 660,000 cubic yards of contaminated sediment from the River, referred to as the Preliminary Injunction. Remediation of this area is estimated at $82.0 million. Additionally, the Court found the harm to the Lower Fox River is “indivisible,” thus leaving the door open for the EPA to demand that NCR alone complete the remediation. Although NCR can seek contribution from other PRPs, future and ongoing costs to remediate the Lower Fox River could be material to Appleton’s financial position. The EPA and the DNR issued two Records of Decision, or RODs, in 2003 estimating the total costs for the Lower Fox River remedial action at approximately $400 million. Other estimates obtained by the PRPs range from a low of $450 million to as much as $1.6 billion. More recent estimates place the cost to remediate operable units 2-5 between $594 million and $900 million. Various government agencies are also asserting that NCR and the other PRPs are liable for natural resources damages caused by the PCBs. In 2000, the U.S. Fish & Wildlife Service estimated that total natural resources damages would be in the range of $176 million to $333 million for all PRPs in the aggregate. To date, Appleton has funded approximately $260 million toward the Lower Fox River remediation, with nearly all of its liability, both direct and through NCR, covered by an indemnity from Arjo Wiggins Appleton p.l.c., now known as Windward Prospects Ltd., or AWA. AWA has funded such payments through a $250 million indemnity insurance policy, which has now been exhausted. It is unclear whether AWA can continue to fund Appleton’s share of the remediation, particularly at the higher end of the cost estimates. To the extent AWA fails to satisfy its indemnity obligations, Appleton would be responsible for a significant portion of NCR’s share, and could also have direct responsibility should the regulatory agencies successfully overturn the April 10, 2012 decision on appeal. Even if Appleton remains responsible for only a significant portion of NCR’s share, the potential liability could be significant, which could have a material adverse effect on Appleton and its results of operations.

In November 2007, the EPA issued an administrative order directing the PRPs to implement the remedial action of the Lower Fox River pursuant to which certain of the PRPs commenced remediation in 2008. In October 2010, the United States and the State of Wisconsin filed a lawsuit on behalf of the EPA and the DNR, respectively, against ten companies, including Appleton, and two municipalities seeking recovery of unreimbursed response costs and natural resources damages as well as a declaratory judgment that the defendants are liable for future response costs related to the Lower Fox River. A trial date for this matter is tentatively scheduled for December 3, 2012. If the EPA and the DNR obtain a favorable ruling, Appleton will be required to share in a significant portion of these costs with NCR. If AWA is unable to meet its indemnity obligations to Appleton, this pending litigation could have a material adverse effect on Appleton and its results of operations.

Prior to its dismissal as a PRP for the Lower Fox River Superfund Site, Appleton hired experts to evaluate its share of liability at the site. The EPA’s and the DNR’s liability estimates attributable to Appleton and NCR range between 30-40%. Appleton’s experts, however, apportioned liability at a much lower 8-10% range. Under

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the 8-10% estimate, Appleton believes it has already paid more than its estimated share of the liability. In its Preliminary Injunction decision, the U.S. District Court for the Eastern District of Wisconsin seemed to reject NCR’s attempts to apportion liability given the indivisibility of the harm. As such, it is uncertain whether NCR (and Appleton) can successfully persuade the same court to reduce its apportioned liability. To the extent Appleton and NCR can demonstrate they remediated more than they contributed, they would be able to seek “contribution” from other PRPs; however, one of the larger PRPs is immune to such contribution action as a result of its own settlement with the EPA.

Appleton believes the Lower Fox River remediation will cease upon completion of operable unit 5 (Green Bay). The EPA could, however, decide to investigate Lake Michigan for possible PCB contamination stemming from the Lower Fox River and deem it necessary to continue remediation beyond the current boundaries of operable unit 5. If the remediation is continued into Lake Michigan, Appleton will be required to share in a significant portion of these additional costs with NCR and the impact on Appleton’s financial condition could be material.

Appleton’s former parent, AWA, may fail to comply with its indemnification obligations related to the acquisition of Appleton.

Appleton is the beneficiary of two indemnification agreements entered into in 2001 wherein AWA agreed to indemnify PDC and PDC agreed to indemnify Appleton for costs, expenses and liabilities related to certain governmental and third-party environmental claims (including certain claims under the Cost Sharing Agreements), which are defined in the agreements as the Fox River Liabilities. Appleton has recorded a $46.4 million environmental indemnification receivable as of April 1, 2012. To date, AWA has funded its indemnity obligations through a $250 million indemnity insurance policy, which has now been exhausted. It is unclear whether AWA can continue to fund Appleton’s share of the remediation, particularly at the higher end of the cost estimates.

As amended in and as limited by the terms of the purchase agreement relating to the acquisition of Appleton, AWA and two of its affiliates have agreed to indemnify PDC and Appleton for certain losses resulting from (1) inaccuracies in the environmental representations and warranties made by AWA and its affiliates, (2) certain known environmental matters that existed at the closing of the acquisition, (3) environmental matters related to the businesses of Newton Falls, Inc., Appleton Coated LLC and several other of Appleton’s former affiliates and subsidiaries and (4) environmental matters relating to the real property on which Appleton’s former Camp Hill, Pennsylvania plant and Appleton’s current distribution center are located that existed prior to its sale of the Camp Hill plant to a third party. Indemnification of these matters could further limit AWA’s ability to meet its indemnity obligations for the Lower Fox River remediation.

If the indemnified matters result in significant liabilities for Appleton, and AWA and/or its affiliates are unable or unwilling to honor these indemnification obligations, Appleton could be required to pay for these liabilities, which could materially adversely affect its business, financial condition and results of operations.

Appleton may have cleanup liabilities for the West Carrollton Mill.

The West Carrollton, Ohio mill operates pursuant to various state and federal permits for discharges and emissions to air and water. As a result of the de-inking of carbonless paper containing PCBs through the early 1970s, there have been releases of PCBs and volatile organic compounds into the soil in the area of the wastewater impoundments at the West Carrollton facility and, in 2001, low levels of PCBs were detected in the groundwater immediately under this area. In addition, PCB contamination was discovered in sediment in the adjacent Great Miami River, but it is believed that this contamination is from a source other than the West Carrollton mill.

The Ohio Environmental Protection Agency, or the Ohio EPA, is presently conducting a biological and water quality survey of the Lower Great Miami River Basin. The study is expected to conclude in 2013. The West Carrollton mill’s waste water discharges into the Great Miami River are included in the study’s scope. The Ohio EPA’s 2012 fish consumption advisory discourages the public from consuming certain types of fish due to PCB, lead and mercury contamination concerns.

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Based on the limited 2001 investigation and delineation of PCB contamination in soil and groundwater in the area of the wastewater impoundments, Appleton believes that it may be necessary to undertake remedial action in the future, although Appleton is currently under no obligation to do so. Appleton has not had any discussions or communications with any federal, state or local agencies or authorities regarding remedial action to address PCB contamination at the West Carrollton mill. The cost for remedial action, which could include installation of a cap, long-term pumping, treating and/or monitoring of groundwater and removal of sediment in the Great Miami River, was estimated in 2001 to range up to approximately $10.5 million, with approximately $3 million in short-term capital costs and the remainder to be incurred over a period of 30 years. However, costs could exceed this amount if additional contamination is discovered, if additional remedial action is necessary or if the remedial action costs are more than expected.

Given the uncertainty surrounding the ultimate course of action for the West Carrollton mill property, the Great Miami River remediation and Appleton’s share of these remediation costs, if any, and since Appleton is currently under no obligation to undertake remedial action in the future, no provision has been recorded in its financial statements for estimated remediation costs. In conjunction with the acquisition of PDC by the ESOP in 2001, and as limited by the terms of the purchase agreement, AWA agreed to indemnify PDC for 50% of all environmental liabilities at the West Carrollton mill for the first $5.0 million in costs and damages and 100% of any costs and damages thereafter. The aggregate indemnity cap under the 2001 purchase agreement is $93 million. Unlike the Lower Fox River indemnity, AWA does not maintain insurance to fund this indemnity. AWA’s ability to meet its indemnity obligations for the West Carrollton mill is uncertain. In addition, the former owners and operators of the West Carrollton mill may be liable for all or part of the cost of remediation of the historic PCB contamination.

Future greenhouse gas/carbon regulations or legislation and future Boiler Maximum Achievable Control Technology regulations, or MACT, could adversely affect Appleton’s costs of compliance with environmental laws.

In 2009, the EPA finalized its finding that greenhouse gas, or GHG, emissions endanger the public health and welfare. Since then, the EPA has finalized rules to regulate GHG emissions under the federal Clean Air Act. Also in 2009, several bills were introduced in the U.S. Congress concerning climate change and the emission into the environment of carbon dioxide and other GHGs. If there is legislation, it may take the form of a cap and trade program and Appleton may then be required, among other things, to purchase allowances or offsets to emit GHGs or other regulated pollutants or to pay taxes on such emissions. In April 2010, the EPA proposed three related air rules commonly known as the Industrial Boiler MACT under the Clean Air Act. These air rules have been finalized by the EPA, but it is still uncertain what the actual final rules will look like as the EPA has opened up portions of the rules for reconsideration and public comment. Appleton is currently analyzing the new draft rules, but because of the uncertainty surrounding these rules, at this time there is no basis for estimating the effect of such legislation or regulations on the costs Appleton will incur to comply with environmental laws, although Appleton is investigating ways to reduce carbon emissions as well as complying with the proposed Boiler MACT.

Appleton has a substantial amount of indebtedness outstanding and, as a result, it is operating as a highly leveraged company.

Appleton’s total debt at April 1, 2012, was approximately $512.0 million. This large amount of indebtedness could:

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Furthermore, although Appleton’s ability to borrow money is restricted by the terms of its various debt agreements, it may be possible for Appleton to incur even more debt and, if it does so, these risks could intensify. Appleton’s ability to service its debt is dependent on its future operating results and Appleton cannot be sure that it will be able to meet its debt obligations as they come due. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Appleton” for additional information.

Appleton’s ability to meet its payment obligations relating to its indebtedness is subject to a variety of factors, including, for example, changes in:

Appleton expects to use cash flow from operations to pay its expenses and scheduled interest and principal payments due under its outstanding indebtedness. Its ability to make these payments depends on its future performance, which is affected by financial, business, economic and other factors, many of which Appleton cannot control. The recent recession and credit crisis and related turmoil in the global financial system has had and may continue to have an adverse effect on Appleton’s business, financial condition, results of operations and cash flows. Consequently, its business may not generate sufficient cash flow from operations in the future and its anticipated growth in revenue and cash flow may not be realized, either or both of which could result in Appleton being unable to repay or pay interest on its indebtedness or to fund other liquidity needs. If Appleton does not have enough money, it may be required to refinance all or part of its then-existing debt, sell assets or borrow more money. Appleton cannot make any assurances that it will be able to accomplish any of these alternatives on terms acceptable to it, or at all. In addition, the terms of existing or future debt agreements, including the indenture governing the notes and the revolving credit facility, as amended, may restrict Appleton from adopting any of these alternatives. The failure to generate sufficient cash flow or to achieve any of these alternatives could significantly adversely affect the value of its indebtedness and its ability to pay the amounts due. In addition, if Appleton defaults in the payment of amounts due, it would give rise to an event of default under the note indentures and possible acceleration of amounts due under its outstanding indebtedness. In the event of any acceleration, there can be no assurance that Appleton will have enough cash to repay its outstanding indebtedness.

Compliance with the covenants relating to Appleton’s indebtedness may limit its operating flexibility.

Certain of Appleton’s debt agreements contain provisions that require Appleton to maintain specified financial ratios as such items are defined in the debt agreements. Appleton’s ability to comply with the financial covenants in the future depends on further debt reduction and achieving forecasted operating results. However, with the volatility being experienced in the current economic environment, it can be difficult to predict the ultimate impact of current economic trends on Appleton’s future operating results. Given the uncertain global economies, continued constraints in the credit markets and other market uncertainties, there are various scenarios, including a reduction from forecasted operating results, under which Appleton could violate its

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financial covenants. Appleton’s failure to comply with such covenants or an assessment that it is likely to fail to comply with such covenants, could also lead Appleton to seek amendments to or waivers of the financial covenants. No assurances can be provided that Appleton would be able to obtain any amendments to or waivers of the covenants. In the event of non-compliance with debt covenants, if the lenders will not amend or waive the covenants, the debt would be due and Appleton would need to seek alternative financing. Appleton cannot provide assurance that it would be able to obtain alternative financing. If Appleton were not able to secure alternative financing, this would have a material adverse impact on Appleton.

The market for the primary product in Appleton’s carbonless papers segment, carbonless paper, may decline more rapidly than anticipated.

Appleton’s carbonless papers segment, of which the primary product is carbonless paper, accounted for 61% of net sales in 2009, 56% of net sales in 2010 and 53% of net sales in 2011. Appleton’s total sales volume of carbonless paper products decreased approximately 11% from 2010 to 2011 despite an increase of approximately 4% from 2009 to 2010 due to increased market share. Appleton believes the worldwide carbonless market is declining as users switch to alternative modes of communication and technologies that do not use impact printing to create images. Appleton expects that its total sales volume of carbonless paper products will continue to decline at rates that are consistent with the decline rate of the overall market. If the decline in Appleton’s sales of carbonless paper products accelerates, or if it is unable to maintain the prices of its carbonless paper products or if it is unable to offset reductions in carbonless papers sales with increased sales of thermal papers or other products, then Appleton’s business, financial condition and results of operations may be materially adversely affected.

Appleton may be unable to develop and introduce new and enhanced products.

Appleton’s success in developing new products will depend in large part on its ability to use its existing technical and manufacturing capabilities and knowledge in the development and introduction of new, value-added products targeted at new markets and customers. If Appleton is unable to utilize its capabilities or properly identify and address the evolving needs of targeted customers and markets, Appleton’s ability to capture and develop new business opportunities will be limited. In addition, if the revenue and profits generated by new products are not sufficient to replace the anticipated decline in revenue and profits generated by carbonless products, then Appleton’s business, financial condition and results of operations may be materially adversely affected.

Appleton’s ability to compete effectively in the marketplace depends, in large part, on its ability to continually improve productivity and reduce operating costs.

Appleton must continually strive to improve the productivity and cost structure of its manufacturing operations and the efficiency of its support services in order to offer products that are priced competitively and deliver an attractive value proposition to its customers. Appleton sets specific productivity and cost reduction goals each year for each of its production facilities and key staff functions. Accomplishing these goals is essential to its near-term competitiveness and long-term financial viability. If Appleton fails to reach these goals, it may experience an erosion of its profit margins, a decline in net sales or both, which could negatively affect its ability to service its debt and invest in the future growth of its business segments.

Appleton currently relies on a relatively small number of customers to generate a significant amount of its net sales from each of its various businesses.

The five largest customers in the carbonless papers segment accounted for approximately 32% of carbonless papers net sales in 2011 and 2010 and 37% of carbonless papers net sales in 2009. The five largest customers in the thermal papers segment accounted for approximately 47% of thermal papers net sales in 2011, 43% of thermal papers net sales in 2010 and 41% of thermal papers net sales in 2009. The largest external customer in

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the Encapsys segment accounted for approximately 59% of Encapsys net sales (which include internal sales to Appleton carbonless papers segment) in 2011, 52% of Encapsys net sales in 2010 and 28% of Encapsys net sales in 2009.

Many of Appleton’s customers are under no obligation to purchase its products in the future. Furthermore, some of Appleton’s customers have become insolvent or financially distressed in recent years. If Appleton loses one or more of its significant customers (e.g., to a competitor or as a result of their being acquired by a customer of a competitor) or any of Appleton’s significant customers experience financial difficulty, then its business, financial condition and results of operations may be materially adversely affected.

Appleton currently relies on a small number of third parties to supply several of the key raw materials used to produce its products.

Appleton’s business depends upon the availability of key raw materials, including base stock and certain chemicals. In 2011, Appleton purchased approximately $114 million of base stock from external suppliers. Appleton relied on a single external supplier for approximately 86% of the base stock it purchased in 2011 to produce carbonless paper products, and a single external supplier for approximately 50% of the base stock Appleton purchased in 2011 to produce thermal papers. For some of the key chemicals Appleton uses in its products, it relies on one or two suppliers. Appleton’s long term supply agreement with Domtar Corporation for the purchase of base stock will further increase Appleton’s reliance on a single external supplier. If there is a disruption in the supply of raw materials, including the chemicals that Appleton needs to produce its carbonless papers and thermal papers, then Appleton may be required to purchase these raw materials from alternative sources, which may result in a significant increase in its operating costs. Included in these increased costs would be development costs associated with qualifying new raw materials and suppliers. Appleton may not be able to procure carbonless base stock, thermal base stock, key chemicals or other raw materials from alternative suppliers in the future in amounts sufficient to meet its needs or at prices consistent with historical prices.

On February 22, 2012, Appleton entered into a long-term supply agreement for the supply of carbonless and thermal base stock to be coated at Appleton’s converting facilities. Under the terms of this supply agreement, the supplier will be the exclusive supplier of certain thermal and carbonless base stock used by Appleton. The term of the agreement is fifteen years. Related to this supply agreement, Appleton’s board of directors approved a plan to dispose of the papermaking operations at Appleton’s West Carrollton, Ohio facility, thereby eliminating Appleton’s capacity to manufacture base stock in West Carrollton. This agreement will have the effect of reducing the number of raw material suppliers to Appleton and increasing Appleton’s dependence on key suppliers. Should this supplier of base stock fail to supply quantities ordered by Appleton, Appleton may not be able to procure alternative sources of carbonless and thermal base stock in quantities sufficient to meet customer requirements or at prices comparable to the terms under this supply agreement.

The lack of available alternative suppliers could subject Appleton to significant cost increases and manufacturing delays and its business, financial condition and results of operations may be materially adversely affected. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Appleton” for additional information.

The cessation of papermaking and transition to base stock supplied under the long-term supply agreement noted above may take longer or cost more than planned.

Appleton has developed plans to cease papermaking operations in West Carrollton and transition to replacement base stock supplied under the long-term supply agreement noted above. Though management has not yet finalized the specific actions to be taken, Appleton expects to incur substantial costs to effect the transition over a defined period and anticipates it will be able to fund those costs with manufacturing cost savings, working capital reductions and normal operations. However, the success of the transition depends on the ability of this supplier to manufacture paper that meets Appleton’s specifications, the ability of Appleton to

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successfully coat the replacement base stock to meet the requirements of Appleton’s customers, and acceptance of the products by customers and the successful use in their businesses. If difficulties develop in the transition process, the time and expense associated with the transition may expand beyond planned periods and amounts and Appleton’s business, financial condition and results of operations may be materially adversely affected.

The global credit market crisis and economic weakness may adversely affect Appleton’s customers and suppliers.

Global financial and credit markets recently have been extremely unstable and unpredictable. Worldwide economic conditions have been weak and may deteriorate further. The instability of the markets and weakness of the global economy could affect the demand for Appleton’s customers’ products, the amount, timing and stability of their orders from Appleton, the financial strength of its customers and suppliers, and/or Appleton’s suppliers’ and customers’ ability to fulfill their obligations to Appleton. These factors could materially adversely affect its business, financial condition and results of operations.

Encapsys’ growth is dependent on the product development cycles of its customers, which are typically lengthy and unpredictable and subject to delay.

Encapsys sells microencapsulation products to consumer product companies, which in turn sell to consumers. Consumer product companies buy Encapsys’ microencapsulation products as a means to enhance the attributes of the products they manufacture and to differentiate such products from those of their competition, in each instance in order to increase sales. Due to the significant volume of such sales, consumer product companies require significant time to re-design their products and to introduce them to the marketplace. Furthermore, such product development cycles can be unpredictable in length and are subject to delay. The lengthy nature of Encapsys’ customers’ product development cycles has the ability to cause Encapsys to miss its budget and to grow slower than expected. Appleton has competitors in its various markets and it may not be able to maintain prices and margins for its products.

Appleton has competitors in its various markets and it may not be able to maintain prices and margins for its products.

Appleton faces strong competition in all of its business segments. Its competitors vary in size and the breadth of their product offerings, and some of its competitors have significantly greater financial, technical and marketing resources than Appleton does. Regardless of the continuing quality of Appleton’s primary products, Appleton may be unable to maintain its prices or margins due to:

Appleton’s inability to compete effectively or to maintain its prices and margins could have a material adverse effect on its earnings and cash flow.

Appleton competes based on a number of factors, including price, product availability, quality and customer service. Additionally, Appleton competes with domestic production and imports from Europe and Asia. In 2007,

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Appleton filed antidumping petitions against imports of certain lightweight thermal paper, or LWTP, from China, Germany and Korea and a countervailing duty petition against such imports from China. In 2008, the U.S. Department of Commerce issued its final determination, affirming that certain Chinese producers and exporters of LWTP sold the product in the United States at prices below fair value, imposing final duties of 19.77% to 115.29%, and that German producers and exporters sold the product in the United States at prices below fair value and imposed final duties on those imports of 6.5%. In addition, for all but one Chinese producer, the U.S. Department of Commerce imposed countervailing duties of between 13.17% and 137.25%. In 2008, the U.S. International Trade Commission, or the ITC, determined the U.S. industry producing LWTP is threatened with material injury due to unfairly traded imports from China and Germany, and final duties went into effect in 2008. These duties do not have a direct impact on Appleton’s net income.

A German manufacturer filed an appeal of the ITC determination to the U.S. Court of International Trade, or the CIT. The appeal was decided in favor of Appleton in 2009, and the German manufacturer filed a further appeal to the U.S. Court of Appeals for the Federal Circuit, or the CAFC. In 2011, the CAFC remanded the matter for further consideration by the ITC, and the ITC upheld its original determination. In January 2012, the CIT upheld the ITC’s decision on remand, and the German manufacturer filed another appeal of the matter to the CAFC.

In addition, for each of the three 12-month periods following implementation of the final duties, Appleton and the German manufacturer have filed requests for administrative review with the Department, seeking to modify the amount of the duties based on the market practices during each respective 12-month period. In 2011, the Department issued a final determination in the first 12-month review period, resulting in a dumping margin of 3.77 percent for imports from the German manufacturer for the period from November 2008 to October 2009. The German manufacturer has appealed the first review determination to the CIT. Upon final resolution of the appeal, the second administrative review and the third administrative review, certain of the duties could be reduced, increased or eliminated.

In March 2009, the Mexican government began imposing tariffs on 90 U.S. products sold into Mexico, including carbonless paper. The tariff on carbonless paper had been 10%. Beginning January 1, 2010, all U.S. sales of carbonless paper into Mexico were assessed a 5% tariff. In August 2010, the Mexican government announced a rotating list of 99 U.S. products to receive tariffs of 5%-45%. Carbonless paper was eliminated from this list and currently is not subject to any import tariffs. Though the tariff was paid by the customer, this automatically increased the price of carbonless paper by the amount of the tariff which could have opened the door for non-U.S. competitors to enter the Mexican market with their carbonless products and take advantage of the ability to offer customers more favorable pricing.

Also during 2010, the Mexican government passed legislation requiring all businesses in Mexico to file their invoices electronically with the government when the transactional value of the invoice is greater than 2000 pesos. In January 2011, this legislation became effective. This legislation allows a phase-in period whereby companies can still use paper invoices for up to two years as long as they obtained prior approval from the government to continue to print sequentially numbered invoices during this phase-in period. The legislation also permitted companies to begin the transition to electronic invoicing prior to the effective date of the legislation. This legislation provides that once a company agrees to offer one of its customers the option of receiving electronic invoices then it needs to extend this option to all customers and thereby no longer issue paper invoices. During 2011, Appleton experienced a decline in its carbonless rolls business in Mexico as a result of this government-legislated electronic invoicing. As there was a two-year phase in, Appleton continues to monitor this risk and how it will impact the carbonless business during 2012. Other multipart documents, including delivery notices, order acknowledgments and other administrative documents, were not addressed in the legislation.

Continued volatility of raw materials costs may adversely impact Appleton’s margins for its products.

In recent years, Appleton has experienced greater volatility in raw materials costs, which comprise a significant portion of Appleton’s operating costs. Appleton endeavors to recover cost increases through

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continuous improvements in its business operations and product formulations and through selected price increases. However, the effects of rising raw materials costs on margins are difficult to match in precise amount or timing with offsetting price increases or cost reduction activities. To the extent Appleton is unable to offset raw materials cost inflation, margins for products may be adversely impacted.

Appleton’s underfunded pension plan requires future pension contributions which could limit flexibility in managing Appleton.

The total projected benefit obligation of Appleton’s defined benefit pension plan exceeded the fair value of the plan assets by $125.8 million at December 31, 2011. Appleton contributed $18.5 million to the pension plan in 2011 and $15.0 million to the pension plan in 2010. Appleton is forecasting a contribution of $25.5 million in 2012. Among the key assumptions inherent in the actuarially calculated pension plan obligation and pension plan expense are the discount rate and the expected rate of return on plan assets. If interest rates and actual rates of return on invested plan assets were to decrease significantly, the pension plan obligation could increase materially. The size of future required pension contributions could result in Appleton dedicating a substantial portion of its cash flow from operations to making the contributions which could materially adversely affect its business, financial condition and results of operations.

Costs related to Appleton’s participation in a multiemployer pension plan could increase, which could limit Appleton’s results of operations and cash flow.

Appleton contributes to a union-sponsored multiemployer defined benefit pension plan, which is regulated by ERISA, pursuant to obligations arising under certain of Appleton’s collective bargaining agreements. This multiemployer pension plan is not administered by or controlled by Appleton and currently has actuarial liabilities for accumulated benefits that are in excess of plan assets. Appleton’s required contributions to this plan could increase or decrease, depending on the outcome of collective bargaining, actions taken by trustees who manage the plan, governmental regulations, market conditions, the actual return on assets held in the plan and the continued viability and contributions of other employers that contribute to the plan. Due to the plan’s underfunding, Appleton is already subject to a rehabilitation plan and is making the necessary contributions. Material increases in Appleton’s contributions to the plan could have an adverse effect on Appleton’s results of operations and cash flow.

In addition, under ERISA, an employer that completely or partially withdraws from a multiemployer pension plan may incur a “withdrawal liability” to the plan, which represents the portion of the plan’s underfunding that is allocable to the withdrawing employer. A withdrawal liability may be incurred under a variety of circumstances, including selling, closing or substantially reducing employment at unionized facilities, amendments to or termination of a collective bargaining agreement, or if the plan is terminated. If incurred, a withdrawal liability is generally payable in installments over a period of years, the amount and duration of the installments being determined under relevant statutory rules. Based on the limited information available from plan administrators, which Appleton cannot independently validate, Appleton believes that its portion of the contingent liability in the case of a full withdrawal or termination could be material to its cash flow and results of operations. If the plan’s underfunded liabilities increase, such underfunding will increase the size of Appleton’s potential withdrawal liability.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

HACII and Appleton make forward-looking statements in this proxy statement. These forward-looking statements relate to outlooks or expectations for earnings, revenues, expenses or other future financial or business performance, strategies or expectations, or the impact of legal or regulatory matters on business, results of operations or financial condition. Specifically, forward-looking statements may include statements relating to:

These forward-looking statements are based on information available to HACII and/or Appleton as of the date of this proxy statement and current expectations, forecasts and assumptions and involve a number of risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing HACII’s or Appleton’s views as of any subsequent date and none of HACII or Appleton undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made.

These forward-looking statements involve a number of known and unknown risks and uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:

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Should one or more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may vary in material respects from those expressed or implied by these forward-looking statements. You should not place undue reliance on these forward-looking statements. Neither HACII nor Appleton undertakes any obligation to update or revise any forward-looking statements to reflect events or circumstances after the date of this proxy statement, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

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CAPITALIZATION

The following table sets forth the capitalization on an unaudited, historical basis of each of HACII and Appleton as of March 31, 2012 and the capitalization on an unaudited, as adjusted basis as of March 31, 2012 after giving effect to the Transaction, assuming (i) that no holders of Public Shares exercise their redemption rights and HACII does not make any permitted repurchases and (ii) that holders of the Public Shares have properly exercised their redemption rights and/or HACII has made permitted repurchases subject to the condition that the amount of cash held in trust is not less than $82.0 million, after giving effect to the Redemption and repurchases but prior to the payment of the Cash Amount, expenses and certain other amounts. Please refer to “ Unaudited Pro Forma Condensed Consolidated Financial Statements ” and “ Special Meetings of HACII Public Warrantholders and HACII Stockholders .”

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SPECIAL MEETINGS OF HACII PUBLIC WARRANTHOLDERS AND HACII STOCKHOLDERS

General

HACII is furnishing this proxy statement to HACII Public Warrantholders and HACII stockholders as part of the solicitation of proxies by its board of directors for use at the special meeting of HACII Public Warrantholders and the special meeting of HACII stockholders to be held on July 11, 2012, and at any adjournment or postponement thereof. This proxy statement is first being mailed to HACII Public Warrantholders and HACII stockholders on or about                 , 2012. This proxy statement provides you with information you need to know to be able to vote or instruct your vote to be cast at the special meeting of HACII Public Warrantholders and the special meeting of HACII stockholders.

Date, Time and Place

The special meeting of HACII Public Warrantholders and the special meeting of HACII stockholders will be held on July 11, 2012, at 9:00 a.m. and 10:00 a.m., respectively, Central Daylight Time, at the offices of Akin Gump Strauss Hauer & Feld, LLP at 1700 Pacific Avenue, 39th Floor, Dallas, Texas 75201, or such other date, time and place to which such meeting may be adjourned or postponed.

Purpose of the Special Meeting of HACII Public Warrantholders

At the special meeting of HACII Public Warrantholders, HACII will ask holders of HACII warrants to consider and vote upon the following proposals:

(1) The Warrant Amendment Proposal —to consider and vote upon a proposal to adopt the Warrant Amendment to allow HACII warrantholders to (i) make each HACII Public Warrant and each Sponsor Warrant exercisable for one-half of one share of HACII Common Stock at an exercise price of $6.00 per half-share, (ii) allow each holder of HACII Public Warrants to elect to receive, for each such outstanding HACII Public Warrant (in exchange for the reduction of shares for which the HACII Public Warrants are exercisable), either (x) the right to receive $0.625 in cash, or (y) the right to exercise the existing warrant for an additional 0.0879 of a share of HACII Common Stock at an exercise price of $0.0001, in the event the last sales price of shares of HACII Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction, subject to a limitation that the holders of no more than 4,550,626 HACII Public Warrants may receive the Public Earnout Shares, and (iii) cause the Sponsor to receive (in exchange for the reduction of shares for which the Sponsor Warrants are exercisable) an additional 0.0879 of a share of HACII Common Stock per Sponsor Warrant, subject to forfeiture by the Sponsor in the event the last sales price of shares of HACII Common Stock does not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction. If the Transaction is consummated, any holder of HACII Public Warrants who votes against the approval of the Warrant Amendment Proposal or who makes no election will receive the Cash Amount for each such HACII Public Warrant. The effect of the Warrant Adjustment will be to reduce the number of shares of HACII Common Stock issuable upon exercise of the HACII warrants by half (excluding the Public Earnout Shares).

(2) The Warrantholder Adjournment Proposal —to consider and vote upon a proposal to adjourn the special meeting of HACII Public Warrantholders to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the special meeting, there are not sufficient votes to approve the Warrant Amendment Proposal; and

(3) Such other procedural matters as may properly come before the special meeting of HACII Public Warrantholders or any adjournment or postponement thereof.

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Purpose of the Special Meeting of HACII Stockholders

At the special meeting of HACII stockholders, HACII will ask holders of HACII Common Stock to consider and vote upon the following proposals:

(1) The Director Election Proposal —to elect nine director nominees to serve on HACII’s board of directors;

(2) The Incentive Plan Proposal —to adopt an equity incentive plan for the stockholders, directors, managers, employees and consultants of HACII and its affiliates;

(3) The Transaction Proposal —to consider and vote upon a proposal to adopt the Equity Purchase Agreement and the Cross Purchase Agreement and to approve the transactions contemplated thereby, pursuant to which, through a series of transactions, Appleton will become a non-wholly-owned subsidiary of HACII;

(4) The Stockholder Adjournment Proposal —to consider and vote upon a proposal to adjourn the special meeting of HACII stockholders to a later date or dates, if necessary, to permit further solicitation and vote of proxies if, based upon the tabulated vote at the time of the special meeting, there are not sufficient votes to approve the Director Election Proposal, the Incentive Plan Proposal and the Transaction Proposal; and

(5) Such other procedural matters as may properly come before the special meeting of HACII stockholders or any adjournment or postponement thereof.

Recommendation of HACII’s Board of Directors

After careful consideration of each of the proposals, each member of HACII’s board of directors recommends that HACII Public Warrantholders vote FOR the Warrant Amendment Proposal and FOR the Warrantholder Adjournment Proposal.

After careful consideration of each of the proposals, each member of HACII’s board of directors has determined that each of the Director Election Proposal, the Incentive Plan Proposal, the Transaction Proposal and the Stockholder Adjournment Proposal is fair to, and in the best interests of, HACII and HACII’s stockholders and recommends that HACII’s stockholders vote FOR the Director Election Proposal, FOR the Incentive Plan Proposal, FOR the Transaction Proposal and FOR the Stockholder Adjournment Proposal. When you consider the recommendation of HACII’s board of directors in favor of the Transaction Proposal, you should keep in mind that certain of HACII’s directors and officers have interests in the Transaction that may conflict with your interests as a stockholder. See the section entitled “ The Transaction—Potential Conflicts of Interests of HACII’s Directors and Officers in the Transaction .”

Record Date; Who is Entitled to Vote

HACII has fixed the close of business on June 19, 2012 as the record date for determining the HACII stockholders entitled to notice of and to attend and vote at the special meeting of HACII stockholders and the close of business on June 19, 2012 as the record date for determining the HACII Public Warrantholders entitled to notice of and to attend and vote at the special meeting of HACII Public Warrantholders. As of the close of business on June 19, 2012, there were 17,142,857 shares of HACII Common Stock outstanding and entitled to vote at the special meeting of HACII stockholders, of which 15,000,000 are Public Shares. As of the close of business on June 19, 2012, the record date for the special meeting of HACII Public Warrantholders, there were 21,666,667 HACII warrants outstanding, of which 15,000,000 are HACII Public Warrants entitled to vote at the special meeting of HACII Public Warrantholders and 6,666,667 are Sponsor Warrants held by the Sponsor. The HACII Public Warrants do not have voting rights other than with respect to the Warrant Amendment Proposal and the Warrantholder Adjournment Proposal.

Required Vote for Warrantholder Proposals

Approval of the Warrant Amendment Proposal requires the affirmative vote of the holders of 65% of the outstanding HACII Public Warrants as of the record date.

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Approval of the Warrantholder Adjournment Proposal requires the affirmative vote of the holders of a majority of the outstanding HACII Public Warrants represented in person or by proxy at the special meeting of HACII Public Warrantholders and entitled to vote thereon as of the record date.

Quorum and Required Vote for Stockholder Proposals

A quorum of HACII’s stockholders is necessary to hold a valid meeting. A quorum will be present at the special meeting of HACII stockholders if a majority of the shares of HACII Common Stock outstanding and entitled to vote at the special meeting of HACII stockholders is represented in person or by proxy. Abstentions, which are discussed further below, will count as present for the purposes of establishing a quorum but broker non-votes will not.

Directors are elected by a plurality of all of the votes cast by holders of shares of HACII Common Stock represented in person or by proxy and entitled to vote thereon at the special meeting of HACII stockholders. This means that the nine nominees will be elected if they receive more affirmative votes than any other nominee for the same position. Stockholders may not cumulate their votes with respect to the election of directors.

Approval of the Incentive Plan Proposal, Transaction Proposal and the Stockholder Adjournment Proposal require a majority of the votes cast by holders of shares of HACII Common Stock represented in person or by proxy and entitled to vote thereon at the special meeting of HACII stockholders.

As of the record date for the special meeting of HACII stockholders, the Initial Stockholders held approximately 12.5% of the outstanding shares of HACII Common Stock, which consists of the Founder Shares acquired prior to the IPO. In connection with the IPO, HACII and the representative of the underwriters in the IPO entered into agreements with the Initial Stockholders pursuant to which the Initial Stockholders agreed to vote all of their Founder Shares in accordance with the majority of the votes cast by the HACII Public Stockholders with respect to an initial business combination and any Public Shares acquired in or after the IPO in favor of an initial business combination.

If HACII, the Initial Stockholders or HACII’s officers and directors purchase Public Shares from existing HACII Public Stockholders that are likely to vote against the Transaction Proposal, the probability that the Transaction Proposal will be approved would increase.

Abstentions and Broker Non-Votes

Under the rules of various national and regional securities exchanges your broker, bank or nominee cannot vote your shares or warrants with respect to nondiscretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or nominee. HACII believes all of the proposals presented to the stockholders and warrantholders will be considered non-discretionary and therefore your broker, bank or nominee cannot vote your shares or warrants without your instruction. If you do not provide instructions with your proxy, your bank, broker or other nominee may deliver a proxy card expressly indicating that it is NOT voting your shares or warrants; we refer to this indication that a bank, broker or nominee is not voting your shares as a “broker non-vote.”

Abstentions and broker non-votes will have no effect on the election of directors.

Abstentions will have the same effect as a vote “AGAINST” the Warrant Amendment Proposal and the Warrantholder Adjournment Proposal. Broker non-votes will have the same effect as a vote “AGAINST” the Warrant Amendment Proposal and will have no effect on the Warrantholder Adjournment Proposal. Holders of Sponsor Warrants will not vote on the Warrant Amendment Proposal or the Warrantholder Adjournment Proposal.

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Abstentions are considered present for the purposes of establishing a quorum but will have the same effect as a vote “AGAINST” the Incentive Plan Proposal, the Transaction Proposal and the Stockholder Adjournment Proposal. Broker non-votes will not be considered present for the purposes of establishing a quorum and will have no effect on the Incentive Plan Proposal, the Transaction Proposal or the Stockholder Adjournment Proposal.

Manner of Voting

We refer to securityholders who hold their HACII Common Stock or HACII Public Warrants in their own name (as opposed to being held in the name of their broker, bank or other nominee) as “holders of record.” Holders of record may vote in person at the special meetings or by proxy. HACII recommends that holders of record vote by proxy even if they plan to attend the special meetings. Holders of record can always revoke their proxy and change their votes at the special meetings.

Proxy Voting by Holders of Record

Voting instructions are attached to your proxy card. If you properly submit your proxy to HACII prior to                     Central Daylight Time on                 , 2012, in the case of HACII Public Warrantholders, and prior to                     Central Daylight Time on                 , 2012, in the case of HACII stockholders, one of the individuals named as your proxy will vote your shares or warrants as you have directed. You may vote for or against any or all of the proposals submitted at the special meetings or abstain from voting.

If you are a holder of record, you may vote your proxy by mail. Please follow the instructions provided on your proxy card. Your submission of proxy authorizes Eric C. Neuman and Curt L. Crofford, and each of them, as proxies, each with the power to appoint his substitute, to represent and vote your shares or warrants.

Only the latest dated proxy received from you will be voted at the special meetings.

Voting of Shares or Warrants Held in “Street Name”

If your shares of HACII Common Stock or HACII Public Warrants are not held in your own name but rather by your broker, bank or another nominee, we refer to your shares or warrants as being held in “street name” by your nominee. If your shares or warrants are held in street name you must instruct your nominee how to vote your shares or warrants.

Your nominee may send to you a separate voting instruction form asking you for your voting instructions. If you do not receive a request for voting instructions well in advance of the special meetings, we recommend that you directly contact your nominee to determine how to cause your shares or warrants to be voted as you wish. Your nominee may permit you to instruct the voting of your shares or warrants electronically using the telephone or Internet. HACII has confirmed that approximately     % of the street name holders will have access to telephone and Internet voting and that such access will continue until 11:59 P.M. Eastern Daylight Time on the day before the special meetings, after which time a street name holder must contact its bank, broker or nominee to vote or change its vote.

How Proxies Will Be Voted

All shares of HACII Common Stock and HACII Public Warrants entitled to vote and represented by properly completed proxies received prior to the special meetings (unless properly revoked) will be voted at the special meetings as instructed on the proxies. If HACII Public Stockholders do not indicate how their shares of HACII Common Stock should be voted on a matter, the shares of HACII Common Stock represented by a properly completed and not properly withdrawn proxy will be voted as HACII’s board of directors recommends and therefore will be voted: “FOR” the Director Election Proposal, “FOR” the Incentive Plan Proposal, “FOR” the Transaction Proposal and “FOR” the Stockholder Adjournment Proposal. If HACII Public Warrantholders do

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not indicate how their HACII Public Warrants should be voted on a matter, the HACII Public Warrants represented by a properly completed and not properly withdrawn proxy will be voted as HACII’s board of directors recommends and therefore will be voted: “FOR” the Warrant Amendment Proposal and “FOR” the Warrantholder Adjournment Proposal.

Revoking Your Proxy

A record holder may revoke a proxy at any time before the special meeting of HACII Public Warrantholders or the special meeting of HACII stockholders, as the case may be, or at such meeting by doing any one of the following:

If you hold your shares or warrants in “street name” and have instructed your bank, broker or other nominee to vote your shares or warrants for you, you must follow instructions you receive from your bank, broker or other nominee in order to change or revoke your vote. Street name holders with access to telephone and Internet voting may change their vote until 11:59 P.M. Eastern Daylight Time on the day before the special meetings, after which time a street name holder must contact his bank, broker or nominee to change his vote.

No Additional Matters May Be Presented at the Special Meetings

The special meeting of HACII Public Warrantholders has been called only to consider the approval of the Warrant Amendment Proposal and the Warrantholder Adjournment Proposal, if necessary. The special meeting of HACII stockholders has been called only to consider the approval of the Director Election Proposal, the Incentive Plan Proposal, the Transaction Proposal and the Stockholder Adjournment Proposal, if necessary. Under HACII’s bylaws, other than procedural matters incident to the conduct of the meeting, no other matters may be considered at either special meeting if they are not included in the notice of the applicable special meeting.

Who Can Answer Your Questions About Voting Your Shares or Warrants

If you have any questions about how to vote or direct a vote in respect of your shares of HACII Common Stock or your HACII Public Warrants, you may call Morrow & Co., LLC, at (800) 662-5200.

Redemption Rights

Since HACII is seeking stockholder approval of the initial business combination, it has agreed to distribute this proxy statement and, in connection herewith, provide HACII Public Stockholders with redemption rights upon consummation of the Transaction. HACII Public Stockholders electing to exercise their redemption rights will be entitled to receive cash equal to their pro rata share of the aggregate amount then on deposit in the trust account, including any amounts representing interest earned on the trust account, less franchise and income taxes payable on such interest and net of interest income of up to approximately $2.25 million on the trust account, which interest income was previously released to HACII to fund its working capital requirements, provided that such stockholders follow the specific procedures for redemption set forth in this proxy statement. Unlike many other blank check companies, HACII Public Stockholders are not required to vote against the Transaction in order to exercise their redemption rights. If the Transaction is not completed, then HACII Public Stockholders electing to exercise their redemption rights will not be entitled to receive such payments. The Initial Stockholders have agreed to vote their Founder Shares in accordance with the majority of the votes cast by the HACII Public Stockholders and to vote any Public Shares purchased during or after the IPO in favor of the Transaction. In

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addition, the Initial Stockholders have agreed to waive their redemption rights with respect to their Founder Shares and Public Shares in connection with a vote on the consummation of the Transaction.

Limitation on Redemption Rights Upon Consummation of the Transaction

Since HACII is holding a stockholder vote to approve the Transaction and is not conducting redemptions pursuant to the tender offer rules in connection with the Transaction, the HACII charter provides that a HACII Public Stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of 10% of the shares sold in the IPO. HACII believes this restriction will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to exercise their redemption rights as a means to force HACII or its management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a HACII Public Stockholder holding more than an aggregate of 10% of the shares sold in the IPO could threaten to exercise its redemption rights if such holder’s shares are not purchased by HACII or its management at a premium to the then-current market price or on other undesirable terms. By limiting its stockholders’ ability to redeem no more than 10% of the shares sold in the IPO, HACII believes it will limit the ability of a small group of stockholders to unreasonably attempt to block its ability to consummate a business combination. However, HACII would not be restricting its stockholders’ ability to vote all of their shares for or against a business combination.

Permitted Purchases of HACII’s Securities

Since HACII is seeking stockholder approval of the Transaction and is not conducting redemptions pursuant to the tender offer rules in connection with the business combination, prior to the consummation of the Transaction, there could be released to HACII from the trust account amounts necessary to purchase up to 15% of the Public Shares (2,250,000 shares). These purchases could occur at any time commencing after the filing of the preliminary proxy statement for the Transaction and ending on the record date for the stockholder meeting to approve the Transaction. Purchases will be made only in open market transactions at times when HACII is not in possession of any material non-public information and may not be made during a restricted period under Regulation M under the Exchange Act. It is intended that purchases will comply with Rule 10b-18 under the Exchange Act, at prices (inclusive of commissions) not to exceed the per-share amount then held in the trust account (approximately $9.95 per share at March 31, 2012). HACII can purchase any or all of the Public Shares it is entitled to purchase. It will be entirely in HACII’s discretion as to how many shares are purchased. Purchasing decisions will be made based on various factors, including the then-current market price of HACII Common Stock and the terms of the Transaction. All shares purchased by HACII will be immediately cancelled. Such open market purchases, if any, would be conducted by HACII to minimize any disparity between the then-current market price of HACII Common Stock and the per-share amount held in the trust account. A market price below the per-share trust amount could provide an incentive for purchasers to buy HACII Common Stock after the filing of the preliminary proxy statement at a discount to the per-share amount held in the trust account for the sole purpose of voting against the Transaction and exercising redemption rights for the full per-share amount held in the trust account. Such trading activity could enable such investors to block the Transaction regardless of its merits by making it difficult to obtain the approval of the Transaction Proposal by the vote of a majority of the outstanding shares of HACII Common Stock voted.

In addition, HACII may enter into privately negotiated transactions to purchase Public Shares from stockholders after consummation of the Transaction with proceeds from the trust account. HACII’s Sponsor, directors, officers, advisors or their affiliates may also purchase shares in privately negotiated transactions. Neither HACII nor its directors, officers, advisors or their affiliates will make any such purchases when in possession of any material non-public information not disclosed to the seller. In the event HACII is the buyer in the privately negotiated purchases, it could elect to use trust account proceeds to pay the purchase price in such transaction after the closing of the Transaction. Although HACII does not currently anticipate paying any

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premium purchase price for such Public Shares, in the event it does, the payment of a premium may not be in the best interest of those stockholders not receiving any such additional consideration. In addition, the payment of a premium may not be in the best interest of the remaining stockholders, who will experience a reduction in book value per share compared to the value received by stockholders that have their shares purchased at a premium. Such a purchase would include a contractual acknowledgement that such stockholder, although still the record holder of HACII shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that HACII, the Sponsor or HACII’s directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from HACII Public Stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. See “ The Transaction—Actions That May Be Taken to Secure Approval of HACII Stockholders ” for more information.

The purpose of such purchases would be to increase the likelihood of obtaining stockholder approval of the Transaction. This may result in the consummation of the Transaction, which may not otherwise have been possible.

As a consequence of such purchases:

The Sponsor and HACII’s officers, directors and/or their affiliates anticipate that they will identify the stockholders with whom the Sponsor and such officers, directors or their affiliates may pursue privately negotiated purchases by either the stockholders contacting HACII directly or by HACII’s receipt of redemption requests submitted by stockholders following its mailing of this proxy statement in connection with the Transaction. To the extent that the Sponsor or HACII’s officers, directors, advisors or their affiliates enter into a private purchase, they would identify and contact only potential selling stockholders who have expressed their election to redeem their shares for a pro rata share of the trust account or vote against the Transaction. Pursuant to the terms of such arrangements, any shares so purchased by the Sponsor and/or HACII’s officers, advisors, directors and/or their affiliates would then revoke their election to redeem such shares. The terms of such purchases would operate to facilitate HACII’s ability to consummate the Transaction by potentially reducing the number of shares redeemed for cash or voted against the proposed business combination.

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Tendering Stock Certificates in Connection with Redemption Rights

HACII is requiring the HACII Public Stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,” to either tender their certificates to HACII’s transfer agent, or to deliver their shares to the transfer agent electronically using Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian) System, at the holder’s option up to two business days prior to the date of the meeting. Accordingly, a HACII Public Stockholder has up to two days prior to the vote on the Transaction to tender its shares if it wishes to seek to exercise its redemption rights. Given the relatively short exercise period, it is advisable for stockholders to use electronic delivery of their Public Shares.

There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the tendering broker $35.00 and it would be up to the broker whether or not to pass this cost on to the redeeming holder. However, this fee would be incurred regardless of whether or not HACII requires holders seeking to exercise redemption rights to tender their shares. The need to deliver shares is a requirement of exercising redemption rights regardless of the timing of when such delivery must be effectuated.

The foregoing is different from the procedures used by many blank check companies. Traditionally, in order to perfect redemption rights in connection with a blank check company’s business combination, the company would distribute proxy materials for the stockholders’ vote on an initial business combination, and a holder could simply vote against a proposed business combination and check a box on the proxy card indicating such holder was seeking to exercise his redemption rights. After the business combination was approved, the company would contact such stockholder to arrange for him to deliver his certificate to verify ownership. As a result, the stockholder then had an “option window” after the consummation of the business combination during which he could monitor the price of the company’s stock in the market. If the price rose above the redemption price, he could sell his shares in the open market before actually delivering his shares to the company for cancellation. As a result, the redemption rights, to which stockholders were aware they needed to commit before the stockholder meeting, would become a “redemption” right surviving past the consummation of the business combination until the redeeming holder delivered its certificate. The requirement for physical or electronic delivery prior to the meeting ensures that a redeeming holder’s election to redeem is irrevocable once the business combination is approved.

Any request to redeem such shares, once made, may be withdrawn at any time up to the date of the stockholder meeting set forth in this proxy statement. Furthermore, if a holder of a Public Share delivered its certificate in connection with an election of redemption rights and subsequently decides prior to the applicable date not to elect to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically or electronically). It is anticipated that the funds to be distributed to holders of Public Shares electing to redeem their shares will be distributed promptly after the completion of the Transaction.

If the Transaction is not approved or completed for any reason, then the HACII Public Stockholders who elected to exercise their redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account even if such redemption right was properly exercised. In such case, HACII will promptly return any certificates delivered by HACII Public Stockholders who elected to redeem their shares. In addition, if the Transaction is not consummated, HACII may continue to try to consummate a business combination with a different target until July 14, 2012.

Appraisal Rights

Appraisal rights are not available to holders of shares of HACII Common Stock or HACII Public Warrants in connection with the proposed Transaction.

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Proxy Solicitation Costs

HACII is soliciting proxies on behalf of its board of directors. All solicitation costs will be paid by HACII. This solicitation is being made by mail but also may be made by telephone or in person. HACII and its directors, officers and employees may also solicit proxies in person, by telephone or by other electronic means, including e-mail and facsimile. Any solicitation made and information provided in such a solicitation will be consistent with the written proxy statement and proxy card. Morrow & Co., LLC, a proxy solicitation firm that HACII has engaged to assist it in soliciting proxies, will be paid an initial fee of $12,500 plus out-of-pocket expenses for its efforts. HACII will pay Morrow & Co., LLC an additional fee of $30,000 upon successful completion of the Transaction.

HACII will ask banks, brokers and other institutions, nominees and fiduciaries to forward its proxy materials to their principals and to obtain their authority to execute proxies and voting instructions. HACII will reimburse them for their reasonable expenses.

HACII, its directors and its executive officers may be deemed to be participants in the solicitation of proxies. The underwriters of the IPO may provide assistance to HACII and its directors and its executive officers, and may be deemed to be participants in the solicitation of proxies. $4.5 million of the underwriting commissions relating to the IPO are deferred pending completion of HACII’s initial business combination, and HACII stockholders and HACII Public Warrantholders are advised that the underwriters have a financial interest in the successful outcome of the proxy solicitation.

Vote of the Initial Stockholders

As of June 19, 2012, the record date for the special meeting of HACII stockholders, the Initial Stockholders and their affiliates beneficially owned and were entitled to vote 2,142,857 Founder Shares, which collectively constitute 12.5% of the issued and outstanding HACII Common Stock. The Initial Stockholders consist of the Sponsor, William A. Montgomery, James C. Musselman and William F. Quinn. The Sponsor is an entity controlled by Thomas O. Hicks, HACII’s founder and chairman of the board. Messrs. Hicks, Montgomery, Musselman and Quinn serve on HACII’s board of directors.

In connection with the IPO, HACII and the representative of the underwriters in the IPO entered into agreements with the Initial Stockholders pursuant to which the Initial Stockholders agreed to vote all of their Founder Shares in accordance with the majority of the votes cast with respect to an initial business combination by the HACII Public Stockholders and any Public Shares acquired in or after the IPO in favor of an initial business combination.

Approval of the Transaction Proposal requires the affirmative vote of the holders of a majority of the issued and outstanding shares of HACII Common Stock entitled to vote thereon as of the record date, present in person or represented by proxy, at the special meeting of HACII stockholders. If HACII, the Initial Stockholders or HACII’s officers and directors purchase Public Shares from existing HACII Public Stockholders that are likely to vote against the Transaction Proposal, the probability that the Transaction Proposal will be approved would increase.

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THE WARRANT AMENDMENT PROPOSAL

Purpose of the Warrant Amendment Proposal

In connection with the proposed Transaction, HACII is proposing the Warrant Amendment in order to (i) make each HACII Public Warrant and each Sponsor Warrant exercisable for one-half of one share of HACII Common Stock at an exercise price of $6.00 per half-share, (ii) allow each holder of HACII Public Warrants to elect to receive, for each such outstanding HACII Public Warrant (in exchange for the reduction of shares for which the HACII Public Warrants are exercisable), either (x) the right to receive $0.625 in cash, or (y) the right to exercise the existing warrant for an additional 0.0879 of a share of HACII Common Stock at an exercise price of $0.0001, in the event the last sales price of shares of HACII Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction, subject to a limitation that the holders of no more than 4,550,626 HACII Public Warrants may receive the Public Earnout Shares, and (iii) cause the Sponsor to receive (in exchange for the reduction of shares for which the Sponsor Warrants are exercisable) an additional 0.0879 of a share of HACII Common Stock per Sponsor Warrant, subject to forfeiture by the Sponsor in the event the last sales price of shares of HACII Common Stock does not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction. If the Transaction is consummated, any holder of HACII Public Warrants who votes against the approval of the Warrant Amendment Proposal or who makes no election will receive the Cash Amount for each such HACII Public Warrant. The effect of the Warrant Adjustment will be to reduce the number of shares of HACII Common Stock issuable upon exercise of the HACII warrants by half (excluding the Public Earnout Shares).

Pursuant to Section 9.8 of the Warrant Agreement, HACII and the warrant agent may amend the Warrant Agreement with the consent of the holders of 65% of the outstanding HACII Public Warrants. The Warrant Amendment will amend the Warrant Agreement in order to provide for the Warrant Adjustment, the Cash Election and the Earnout Shares Election. The Warrant Amendment will also amend Section 4.6 in order to allow for payments in lieu of fractional shares.

Other than the Warrant Adjustment and the right to elect the Cash Election or the Earnout Shares Election, the terms of the HACII warrants will remain essentially the same. Both the Public Warrants and the Sponsor Warrants will be amended pursuant to the Warrant Amendment, and both the Public Warrants and the Sponsor Warrants will be treated the same for purposes of the Warrant Adjustment. However, only holders of HACII Public Warrants will be entitled to make the Cash Election or the Earnout Shares Election. The Sponsor will instead receive 586,000 Sponsor Earnout Shares. The Sponsor Earnout Shares are effectively the same as the Public Earnout Shares, as the economic value of both the Sponsor Earnout Shares and the Public Earnout Shares are triggered by the same target stock price.

HACII believes the consummation of the Warrant Adjustment, the Cash Election and the Earnout Shares Election will provide benefits to HACII and its warrantholders. For example, HACII believes that the Warrant Adjustment, the Cash Election and the Earnout Shares Election are important to the consummation of the Transaction because reduction of the outstanding HACII warrants in HACII’s capital structure following the consummation of the Transaction will increase HACII’s strategic opportunities and attractiveness to future investors.

In the event that the Warrant Amendment Proposal is not approved at the special meeting of HACII Public Warrantholders, the Director Election Proposal, the Incentive Plan Proposal, and the Transaction Proposal will not be presented to HACII stockholders for a vote. If HACII is unable to consummate an initial business combination by July 14, 2012, it will be required to liquidate and all HACII warrants will expire worthless.

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Sponsor Earnout Shares

In connection with the Warrant Amendment, the Sponsor will receive 586,000 Sponsor Earnout Shares, which is the equivalent of 0.0879 of a share of HACII Common Stock per Sponsor Warrant, that are subject to forfeiture by the Sponsor in the event the last sales price of shares of HACII Common Stock does not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for 20 trading days out of 30 consecutive trading days on or prior to the fifth anniversary of the closing of the Transaction. The Sponsor Earnout Shares are effectively the same as the Public Earnout Shares, as the economic value of both the Sponsor Earnout Shares and the Public Earnout Shares are triggered by the same target stock price.

Limitation on Public Earnout Shares

In connection with the Earnout Shares Election, holders of no more than 4,550,626 HACII Public Warrants may receive the Public Earnout Shares. Therefore, if the holders of more than 4,550,626 HACII Public Warrants make the Earnout Shares Election, the limitation on the number of Public Earnout Shares will be reached. In such event, all holders of HACII Public Warrants that have made the Earnout Shares Election will have the number of HACII Public Warrants receiving Public Earnout Shares reduced pro rata, determined by multiplying the number of HACII Public Warrants evidenced by a specific Earnout Shares Election by a fraction (x) the numerator of which is 4,550,626 and (y) the denominator of which is the aggregate number of HACII Public Warrants evidenced by all Earnout Shares Elections. Any remaining HACII Public Warrants will receive the Cash Amount in lieu of Public Earnout Shares. There is no limitation on the number of HACII Public Warrants that may elect to receive the Cash Amount.

Exercisability of HACII Warrants

Pursuant to the terms of the Warrant Amendment, holders of HACII warrants will be required to exercise such HACII warrants in pairs or, to the extent practicable, other amounts necessary to avoid issuing fractional shares of HACII Common Stock. In addition, in lieu of issuing any fractional shares of HACII Common Stock, HACII shall pay to the exercising holder an amount in cash equal to the product obtained by multiplying (x) the fractional share interest in HACII Common Stock to which such holder would otherwise be entitled by (y) the trading price of one share of HACII Common Stock on the exercise date.

Certain Effects of the Warrant Adjustment, the Cash Election and the Earnout Shares Election

HACII Public Warrantholders should note that there may be income tax consequences in connection with the Warrant Adjustment, the Cash Election and the Earnout Shares Election. For a discussion of the tax consequences of the Warrant Adjustment, the Cash Election and the Earnout Shares Election, please see the section entitled “ Material U.S. Federal Income Tax Consequences .”

Required Vote

Approval of the Warrant Amendment Proposal requires the affirmative vote of the holders of 65% of the outstanding HACII Public Warrants as of the record date.

Recommendation

HACII’S BOARD OF DIRECTORS RECOMMENDS THAT HACII PUBLIC WARRANTHOLDERS VOTE “FOR” THE APPROVAL OF THE WARRANT AMENDMENT PROPOSAL. WHEN YOU CONSIDER THE RECOMMENDATION OF HACII’S BOARD OF DIRECTORS IN FAVOR OF THE WARRANT AMENDMENT PROPOSAL, YOU SHOULD KEEP IN MIND THAT CERTAIN OF HACII’S DIRECTORS AND OFFICERS HAVE INTERESTS IN THE TRANSACTION THAT MAY CONFLICT WITH YOUR INTERESTS AS A WARRANTHOLDER. SEE THE SECTION ENTITLED, “THE TRANSACTION—POTENTIAL CONFLICTS OF INTERESTS OF HACII’S DIRECTORS AND OFFICERS IN THE TRANSACTION.”

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THE WARRANTHOLDER ADJOURNMENT PROPOSAL

The Warrantholder Adjournment Proposal, if adopted, will allow HACII’s board of directors to adjourn the special meeting of HACII Public Warrantholders to a later date or dates to permit further solicitation of proxies in the event that, based on the tabulated votes, there are not sufficient votes at the time of the special meeting to approve the Warrant Amendment Proposal. The Warrantholder Adjournment Proposal will only be presented to HACII Public Warrantholders in the event that, based on the tabulated votes, there are not sufficient votes at the time of the special meeting of HACII Public Warrantholders to approve the Warrant Amendment Proposal.

Consequences if the Warrantholder Adjournment Proposal Is Not Approved

If the Warrantholder Adjournment Proposal is not approved by the HACII Public Warrantholders, HACII’s board of directors may not be able to adjourn the special meeting of HACII Public Warrantholders to a later date in the event that, based on the tabulated votes, there are not sufficient votes at the time of the special meeting to approve the Warrant Amendment Proposal. In such event, the Warrant Adjustment, the Cash Election and the Earnout Shares Election would not be permitted and HACII would be required to dissolve and liquidate and all HACII warrants would expire worthless.

Required Vote

Adoption of the Warrantholder Adjournment Proposal requires the affirmative vote of a majority of the outstanding HACII Public Warrants as of the record date represented in person or by proxy at the special meeting of HACII Public Warrantholders and entitled to vote thereon. Adoption of the Warrantholder Adjournment Proposal is not conditioned upon the adoption of any of the other proposals.

Recommendation

HACII’S BOARD OF DIRECTORS RECOMMENDS THAT HACII PUBLIC WARRANTHOLDERS VOTE “FOR” THE APPROVAL OF THE WARRANTHOLDER ADJOURNMENT PROPOSAL.

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THE DIRECTOR ELECTION PROPOSAL

HACII’s board of directors is divided into three classes, being divided as equally as possible with each class having a term of three years. All of HACII’s current directors have agreed to resign upon the consummation of the Transaction, with the exception of Thomas O. Hicks. HACII’s independent directors have nominated Stephen P. Carter, Thomas O. Hicks and Andrew F. Reardon for election to serve on HACII’s board of directors as Class I Directors; Mark R. Richards, Kathi P. Seifert and Mark A. Suwyn for election to serve on HACII’s board of directors as Class II Directors; and Terry M. Murphy, Christina Weaver Vest and George W. Wurtz for election to serve on HACII’s board of directors as Class III Directors. Each of the Class I directors will be elected to hold office for a term of one year until the annual meeting of stockholders in 2013 and until his respective successor is duly elected and qualified. Each of the Class II directors will be elected to hold office for a term of two years until the annual meeting of stockholders in 2014 and until his respective successor is duly elected and qualified. Each of the Class III directors will be elected to hold office for a term of three years until the annual meeting of stockholders in 2015 and until his respective successor is duly elected and qualified. In the event that the Transaction is not consummated, the Director Election Proposal will not take effect.

The following sets forth information regarding each nominee.

Class I Nominees for Election to HACII’s Board of Directors

Stephen P. Carter, 60

Stephen P. Carter has served as a director of Appleton since July 2004. Mr. Carter is also currently a principal in Ingenium Aerospace LLC, a consultant and a director of Blackhawk Bancorp., Inc., a publicly-held bank holding company and a director of Hollister, Incorporated, a privately held medical device company. Mr. Carter has been a principal in Ingenium Aerospace LLC since March 2010, a director of Blackhawk Bancorp, Inc. since 2003, and a director of Hollister, Incorporated since 2009. Mr. Carter retired as the Executive Vice President, Chief Financial Officer and Treasurer for Woodward, Inc. in August 2005, a position he held since January 2003. Mr. Carter graduated with a bachelor’s degree from Brigham Young University in 1973 and is a CPA in Illinois. Mr. Carter’s experience, qualifications, attributes and skills that led to the conclusion that he should serve as a director of HACII include his prior experience as a director of Appleton, his financial background as a certified public accountant, a consultant and director of a bank holding company and as the former Executive Vice President, Chief Financial Officer and Treasurer for a large industrial company, as well as his leadership experience in these positions and as a director of a medical device company.

Thomas O. Hicks, 66

Thomas O. Hicks , HACII’s founder, has been HACII’s chairman of the board since its inception. Since 2005, Mr. Hicks has served as the chairman of Hicks Holdings LLC, a holding company for real estate, private equity and sports investments of Mr. Hicks and his family. Mr. Hicks and his affiliates are also, directly or indirectly, the controlling stockholders of DirecPath, LLC, a company that provides bundled DIRECTV programming, broadband voice and data services, security and other locally based services to multiple dwelling units across the United States; Ocular LCD, Inc., a designer, manufacturer and marketer of high-performance liquid crystal displays, modules and systems; Directional Rentals Holdings, Inc., an oilfield service provider focused on downhole rental tools; and Grupo Pilar, an animal and pet food company in Argentina. Sales of Major League Baseball’s Texas Rangers and the National Hockey League’s Dallas Stars, each formerly held by Mr. Hicks and his affiliates, were completed in 2010 and 2011, respectively, through a court-supervised auction process under Chapter 11 of the U.S. Bankruptcy Code. Mr. Hicks co-founded Hicks, Muse, Tate & Furst, a nationally prominent private equity firm in the United States that specialized in leveraged acquisitions, and served as its chairman from 1989 through 2004. During Mr. Hicks’ tenure as chairman, Hicks, Muse, Tate & Furst raised over $12 billion of private equity funds, and consummated over $50 billion of leveraged acquisitions, and was one of the most active private investment firms in the country. Mr. Hicks also co-founded and served as co-chief executive officer of the leveraged buy-out firm Hicks & Haas from 1984 until 1989.

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Mr. Hicks currently serves as a director of DirecPath, LLC, Ocular LCD, Inc., Carpenter Technology Corporation and Directional Rentals Holdings, Inc. Mr. Hicks received a Master’s of Business Administration degree from the University of Southern California in 1970 and a Bachelor of Business Administration degree from the University of Texas in 1968. Mr. Hick’s experience, qualifications, attributes and skills that led to the conclusion that he should serve as a director of HACII include his background of 39 years in the private equity industry, his substantial experience in identifying and acquiring a wide variety of businesses and his experience as a member of the boards of directors of public and private companies.

Andrew F. Reardon, 66

Andrew F. Reardon has served as a director of Appleton since June 2007. Mr. Reardon retired in November 2008 as the Chairman and Chief Executive Officer of TTX Company, positions he held since June 1, 2008. Prior to June 1, 2008, he was the President and Chief Executive Officer of TTX Company, positions he held since 2001. He is a principal in the law firm of Reardon & Chasar, L.P.A., located in Cincinnati, Ohio, engaged in business and transportation law and representation before legislative bodies. He joined TTX in 1992 as Vice President of Human Resources and Labor Relations. He later served as Vice President of Law and Human Resources and was named President of the company in 2000. TTX is a large supplier of leased railcars in North America. Mr. Reardon earned a bachelor’s degree from the University of Notre Dame (English) in 1967 and a Juris Doctor degree from the University of Cincinnati in 1974. He also earned a L.L.M. degree in taxation from Washington University Law School in 1975. Mr. Reardon’s prior experience as a director of Appleton, his business and legal experience as a principal in a law firm, consultant and former Chairman and Chief Executive Officer and Vice President of Law and Human Resources for a major North American railcar supply company, as well as his leadership experience in these positions and his graduate degree in law, led to the conclusion that he should serve as a director of HACII.

Class II Nominees for Election to HACII’s Board of Directors

Mark R. Richards, 52

Mark R. Richards has been Chief Executive Officer and President of Appleton since April 2005 and a director and Chairman of Appleton since June 2005. Mr. Richards has also served as a director for Neenah Foundry Company since August 2010. Prior to joining Appleton, Mr. Richards served as President of the Engineered Support Structures division of Valmont Industries, Inc. since 1999. Mr. Richards is a graduate of Northwestern University’s Kellogg Graduate School of Management where he earned a master’s degree in business administration with concentrations in marketing and finance in 1989. He earned a bachelor’s degree in packaging from Michigan State University in 1983. Mr. Richards’ experience, qualifications, attributes and skills that led to the conclusion that he should serve as a director of HACII include his prior experience as a director and as Chief Executive Officer and President of Appleton, his extensive business and management experience as division President of a global producer of engineered products and services, as well as his leadership experience at Appleton and as a director of a large North American supplier of municipal castings, and his graduate degree in business.

Mark A. Suwyn, 69

Mark A. Suwyn has served as a director of Appleton July 2011. Mr. Suwyn is also currently the President of Marsuw, LLC, a private investment and consulting company, and has held this position since March 2000. Mr. Suwyn retired as Chairman of NewPage Corporation, a large coated paper producer in North America, in June 2010. He had previously served as Chairman and Chief Executive Officer of NewPage Corporation since May 2005. Mr. Suwyn is also currently a director of Ballard Power Systems, Inc, and Contech Construction Products Inc. He has served as a director of Ballard Power Systems, Inc. since 2003 and as a director of Contech Construction Products Inc. since 2011. Mr. Suwyn also served as Chairman and Chief Executive Officer of Louisiana-Pacific Corporation from January 1996 until November 2004. Prior to that, Mr. Suwyn held executive management positions with International Paper Company and spent 25 years with E.I. Du Pont where he directed

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marketing, acquisition and joint venture efforts. Mr. Suwyn earned a doctorate degree (Inorganic Chemistry) from Washington State University and bachelor’s degree (Chemistry) from Hope College, Holland, Michigan. Mr. Suwyn’s experience, qualifications, attributes and skills that led to the conclusion that he should serve as a director of HACII include his prior experience as a director of Appleton, his extensive business experience in the paper industry, experience as former Chairman and Chief Executive Officer for both a large coated paper producer and a leading manufacturer of building materials, as well as his leadership experience as an executive and director and his doctorate degree in chemistry.

Kathi P. Seifert, 62

Kathi P. Seifert has served as a director of Appleton since July 2004. Ms. Seifert retired as Executive Vice President and Group President of Global Personal Care Products for Kimberly-Clark Corporation in June 2004, a position she held since 1999. Ms. Seifert is also currently a director of Eli Lilly and Company, Revlon Consumer Products Corporation, Supervalu, Inc. and Lexmark, Inc. She has served as a director of Eli Lilly and Company since 1995 and as a director of Revlon Consumer Products Corporation, Supervalu, Inc. and Lexmark, Inc. since 2006. Ms. Seifert served as a director of Albertson’s, Inc. in 2005. Ms. Seifert also serves on the Board of Directors for the U.S. Fund for UNICEF, the Fox Cities Performing Arts Center, and New North. Ms. Seifert graduated with a bachelor’s degree from Valparaiso University in 1971. Ms. Seifert’s experience, qualifications, attributes and skills that led to the conclusion that she should serve as a director of HACII include her prior experience as a director of Appleton, her business experience as the former Executive Vice President and division Group President of a global manufacturer of family and personal care products, and as a director of a global pharmaceutical company, cosmetics and personal care products company, grocery retailing company, and printing and imaging products manufacturing company, as well as her leadership experience in these positions.

Class III Nominees for Election to HACII’s Board of Directors

Terry M. Murphy, 63

Terry M. Murphy has served as a director of Appleton since June 2007. Mr. Murphy is also currently a director of Hagerty, LLC, a specialty insurance company, and has held this position since July 2010. Mr. Murphy is also a member of the Board of Trustees of Carroll University located in Waukesha, Wisconsin, and has held this position since May 2007. Mr. Murphy was Executive Vice President and Chief Financial Officer of A.O. Smith from the time he joined the company in 2006 until his retirement on May 1, 2011. From 1999 to 2005, Mr. Murphy held various executive management positions at Quanex Corporation and in his last position at Quanex Corporation served as its Senior Vice President and Chief Financial Officer. Mr. Murphy earned a bachelor’s degree from the University of Wisconsin-LaCrosse in 1970 and a master’s degree in business administration from Marquette University in 1974. He also earned a Juris Doctor degree from Seton Hall University School of Law in 1980 and is a certified public accountant. Mr. Murphy’s experience, qualifications, attributes and skills that led to the conclusion that he should serve as a director of HACII include his prior experience as a director of Appleton, his financial background as a certified public accountant, former Senior Vice President and Chief Financial Officer for a large building products manufacturing company, and former Executive Vice President and Chief Financial Officer for a large diversified manufacturing company, as well as his leadership experience as an executive and director, and his graduate degree in business and degree in law.

Christina Weaver Vest, 41

Christina Weaver Vest has been HACII’s president and chief executive officer since December 31, 2010, and HACII’s chief financial officer since its inception. Ms. Vest also currently serves as a managing director and partner of Hicks Equity Partners LLC, and previously served from 2005 until April 2007 as a senior vice president of its affiliate, Hicks Holdings LLC. Prior to that, Ms. Vest served as a Principal at HM Capital Partners (formerly Hicks, Muse, Tate & Furst), which she joined in 1995. Ms. Vest currently serves as a director of Ocular LCD, Inc., a designer, manufacturer and marketer of high-performance liquid crystal displays, modules and systems. Ms. Vest received a Bachelors of Arts degree from Harvard University in 1993 and a Master’s of

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Business Administration degree from Harvard Business School in 1999. Ms. Vest’s experience, qualifications, attributes and skills that led to the conclusion that she should serve as a director of HACII include her prior experience in the private equity industry, her experience in identifying and acquiring a wide variety of businesses, as well as her leadership experience and her graduate degree in business.

George W. Wurtz, 55

George W. Wurtz has served as a director of Appleton since July 2011. From November 2006 until November 2011, Mr. Wurtz served as President and Chief Executive Officer of New WinCup Holdings, Stone Mountain, Georgia, a privately-held manufacturer and distributor of single-use cups, food service containers, lids and straws. Mr. Wurtz is currently a director of the State University of New York at Oswego, or SUNY Oswego, Engineering Advisory Board and Mohawk Fine Papers, Inc. He has served as a director of the SUNY Oswego Engineering Advisory Board since 2009 and as a director of Mohawk Fine Papers, Inc. since January 2012. Mr. Wurtz retired as Executive Vice President of Georgia-Pacific Corporation in February 2006 after serving in several executive management positions including President of Paper, Bleached Board and Kraft Operations. Prior to joining Georgia-Pacific Corporation in October 2000, Mr. Wurtz was employed by James River Corporation/Fort James Corporation for 14 years and held executive management positions in operations, logistics, procurement and manufacturing planning. Mr. Wurtz received his bachelor’s degree (Industrial Arts and Technology) from SUNY Oswego in 1978. Mr. Wurtz’s experience, qualifications, attributes and skills that led to the conclusion that he should serve as a director of HACII include his prior experience as a director of Appleton, his extensive business experience in the paper industry, experience as former President and Chief Executive Officer of a food-service products manufacturer and distributor, as well as his leadership experience as an executive and director of several paper companies.

Required Vote

Proxies will have full discretion to cast votes for other persons in the event any nominee is unable to serve. HACII’s board of directors has no reason to believe that any nominee will be unable to serve if elected. If a quorum is present, directors are elected by a plurality of all of the votes cast by holders of shares of HACII Common Stock represented in person or by proxy and entitled to vote thereon at the special meeting of HACII stockholders. This means that the nine nominees will be elected if they receive more affirmative votes than any other nominee for the same position. Votes marked “FOR” a nominee will be counted in favor of that nominee. Abstentions and broker non-votes will have no effect on the vote since a plurality of the votes cast is required for the election of each nominee. HACII stockholders may not cumulate their votes with respect to the election of directors.

Recommendation

HACII’S BOARD OF DIRECTORS RECOMMENDS THAT HACII STOCKHOLDERS VOTE “FOR” EACH OF THE NINE NOMINEES.

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THE INCENTIVE PLAN PROPOSAL

At the special meeting of HACII stockholders, as previously described in this proxy statement, HACII stockholders will be asked to adopt an Equity Incentive Plan for the directors, officers, members, managers, employees, consultants and advisors of HACII and its affiliates, a copy of which is attached as Annex B to this proxy statement. In the event that the Transaction is not consummated, the Incentive Plan Proposal will not take effect.

Background

The Incentive Plan has been approved by HACII’s board of directors subject to approval by HACII’s stockholders. The purpose of the Incentive Plan is to provide a means through which HACII and its affiliates may attract and retain key personnel and provide a means whereby directors, officers, members, managers, employees, consultants and advisors (and prospective directors, officers, members, managers, employees, consultants and advisors) of HACII and its affiliates can acquire and maintain an equity interest in HACII, or be paid incentive compensation, thereby strengthening their commitment to the welfare of HACII and its affiliates and aligning their interests with those of HACII’s stockholders.

HACII may grant stock options, stock appreciation rights, restricted stock, restricted stock units, stock bonus awards and performance compensation awards, collectively referred to in this proxy statement as Awards, to current or prospective employees, directors, officers, consultants and advisors, and those of its affiliates. Generally, all classes of employees will be eligible to participate in the Incentive Plan. No Awards under the Incentive Plan have been made or committed to be made as of the date of this proxy statement.

The following is a summary of the material provisions of the Incentive Plan and is qualified in its entirety by reference to the complete text of the Incentive Plan, a copy of which is attached to this proxy statement as Annex B.

Administration

The Incentive Plan will be administered by a committee, referred to as the Committee, appointed by the board of directors of HACII, or the Board. If no such committee has been appointed by the Board, then the Board will serve as the Committee. To the extent required to comply with the provisions of Rule 16b-3 under Section 16 of the Exchange Act (if the Board is not acting as the Committee) or necessary to obtain the exception for “performance-based compensation” under Section 162(m) of the Internal Revenue Code of 1986, as amended, or the Code, as applicable, each member of the Committee is intended to be, at the time he takes any action with respect to an Award under the Incentive Plan, a person who is (i) a “non employee director” within the meaning of Rule 16b-3, and (ii) an “outside director” within the meaning of Section 162(m) of the Code.

The Incentive Plan provides the Committee with the sole and plenary authority to:

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Eligibility

Employees (unless covered by a collective bargaining agreement that does not provide for eligibility), directors, officers, consultants or advisors of HACII or its affiliates are eligible to participate in the Incentive Plan. Prospective employees, directors, officers, consultants or advisors who have accepted offers of employment or consultancy from HACII or its affiliates are also eligible to participate in the Incentive Plan once their employment or services begin. Upon the consummation of the Transaction, approximately 40 employees and officers and eight non-employee directors would be eligible as a class to be selected to receive Awards under the Incentive Plan.

Shares Subject to the Incentive Plan

Subject to adjustments for certain corporate transactions or events, HACII has reserved a maximum of 2.3 million common shares that may be delivered to participants under the Incentive Plan. No participant may be granted, during any one-year period, stock options or stock appreciation rights with respect to more than 700,000 common shares or any other Awards with respect to more than 400,0000 common shares. No Participant shall individually earn a cash-based performance compensation Award exceeding $5,000,000 in one year.

Types of Awards

The Incentive Plan permits the Committee to grant the following types of Awards:

Stock Options. Stock options granted under the Incentive Plan may be incentive stock options intended to qualify under the provisions of Code Section 422, or nonqualified stock options that do not so qualify. All stock options granted under the Incentive Plan will be nonqualified stock options unless the applicable Award agreement expressly states that it is intended to be an incentive stock option, as designated by the Committee. The exercise price per common share for each stock option will not be less than the greater of the par value or the fair market value of such common share determined as of the date of grant. However, in the case of an incentive stock option granted to an employee who, at the time of the grant of such stock option, owns (directly or indirectly) stock representing more than 10% of the total combined voting power of all classes of stock of HACII or of any parent or subsidiary corporation, or a 10% stockholder, the exercise price per share will not be less than 110% of the fair market value per share on the date of grant. Stock options will vest and become exercisable at a rate determined by the Committee on the date of grant, and will expire after a period of no more than ten years, as determined by the Committee on the date of grant. However, the term of an incentive stock option granted to a 10% stockholder will not exceed five years from the date of grant.

Stock Appreciation Rights. The Incentive Plan permits the Committee to award stock appreciation rights, referred to as SARs, to current or prospective employees, directors, consultants or advisors of HACII and its subsidiaries. SARs may be granted either alone or in tandem with stock options. Upon the exercise of a SAR, HACII will pay to the participant an amount equal to the number of common shares subject to the SAR that are being exercised multiplied by the excess, if any, of the fair market value of one common share on the exercise date over the strike price. A SAR’s strike price will be determined by the Committee, and will not be less than the fair market value on the date of grant of a common share. SARs may be settled in cash, in common shares valued at fair market value, or a combination of both, as determined by the Committee.

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Restricted Stock and Restricted Stock Units. Restricted stock and restricted stock units may be granted under the Incentive Plan. Shares of restricted stock are common shares that are subject to certain specified restrictions (including, without limitation, a requirement that the participant remain continuously employed or provide continuous services for a specified period of time). A restricted stock unit is an unfunded and unsecured promise to deliver common shares, cash, other securities or other property, subject to certain restrictions (including, without limitation, a requirement that the participant remain continuously employed or provide continuous services for a specified period of time). Subject to certain restrictions, upon the grant of restricted stock to a participant, the participant will generally have the rights and privileges of a stockholder as to such restricted stock, including the right to vote such restricted stock and the right to receive dividends, if applicable. Restricted stock and restricted stock units will vest, and the specified restrictions lapse, at a rate determined by the Committee and specified in the Award agreement on the date of grant. Unless otherwise provided in the Award agreement, the restrictions will lapse with respect to 100% of the restricted stock or restricted stock units on the third anniversary of the date of grant. The unvested portion of restricted stock and restricted stock units generally will terminate and be forfeited upon the participant’s termination of employment or service with HACII and its affiliates.

Stock Bonus Awards. The Committee may issue unrestricted common shares, or other Awards denominated in common shares, under the Incentive Plan, either alone or in tandem with other Awards. Each stock bonus award will be subject to such conditions as the Committee determines and reflected in the applicable Award agreement.

Performance Compensation Awards. The Committee may designate any Award granted under the Incentive Plan as a performance compensation award intended to qualify as “performance-based compensation” under Section 162(m) of the Code. With regard to any performance compensation award, the Incentive Plan provides the Committee with the sole discretion to select the length of the performance period, the type or types of performance compensation awards to be issued, the performance criteria that will be used to establish the performance goal or goals, the kind and level of the performance goals that are to apply, and the performance formula.

The performance criteria that may be used to establish performance goals will be based on the attainment of specific levels of performance of HACII (and/or one or more divisions or operational units) and includes the following:

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Transferability

Each Award may be exercised during the participant’s lifetime only by the participant, or, if permissible under applicable law, by the participant’s legal guardian or representative, and may not be otherwise transferred or encumbered by a participant other than by will or by the laws of descent and distribution. However, the Committee may permit Awards (other than incentive stock options) to be transferred to family members, a trust for the benefit of the participant or his or her family members, a partnership or limited liability company whose partners or members are the participant or his or her family members or anyone else approved by it or the Board.

Change of Control

Except to the extent otherwise provided in an Award agreement, in the event of a Change in Control (as defined in the Incentive Plan), the Committee may provide that, with respect to all or any portion of a particular outstanding Award or Awards: (a) all of the then outstanding stock options and SARs will immediately vest and become immediately exercisable; (b) the restricted period for any restricted stock or restricted stock units will expire; and (c) performance periods in effect will end on the date the Change in Control occurs. In such event, the Committee will determine the extent to which performance goals for any performance compensation awards have been met based on audited or unaudited financial information or other information then available as it deems relevant. A participant may be entitled to receive partial or full payment of performance compensation awards based upon the Committee’s determination of the degree of attainment of the performance goals, or assuming that the applicable “target” levels of performance have been attained or on such other basis determined by the Committee.

Amendment and Termination of the Incentive Plan

The Board may amend or terminate the Incentive Plan at any time, except that no amendment to the performance criteria or the provision in the Incentive Plan governing amendment of Award agreements will be made without stockholder approval, and no other amendment or termination will be made without stockholder approval if such approval is necessary to comply with any tax or regulatory requirement applicable to the Incentive Plan. Any amendment or termination that would materially and adversely affect the rights of any participant or any holder or beneficiary of any outstanding Award will not to that extent be effective without the consent of the affected participant, holder or beneficiary.

U.S. Federal Income Tax Consequences

The following is a brief description of the material federal income tax consequences of receiving stock options under the Incentive Plan and is based on an analysis of the present provisions of the Code and the regulations promulgated thereunder, all of which are subject to change. A participant may also be subject to state

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and local taxes, the consequences of which are not discussed herein, in the jurisdiction in which he or she works or resides. Moreover, the federal income tax consequences to any particular participant may differ from those described herein by reason of, among other things, the particular circumstances of the participant. This summary is for general information purposes only and is not tax advice.

Incentive Stock Options. An employee granted an incentive stock option will not realize any taxable income upon the grant or the exercise of an incentive stock option. However, the amount by which the fair market value of the shares covered by the incentive stock option (on the date of exercise) exceeds the exercise price paid will be an item of tax preference to which the alternative minimum tax may apply, depending on the participant’s individual circumstances. If the participant does not dispose of the common shares acquired by exercising an incentive stock option within two years from the date of the grant of the incentive stock option and within one year after the shares are transferred to the participant, when the participant later sells or otherwise disposes of the shares, any amount realized by the participant in excess of the exercise price paid will be taxed as a long-term capital gain and any loss will be recognized as a long-term capital loss. HACII generally will not be entitled to an income tax deduction with respect to the grant or exercise of an incentive stock option.

If any of the common shares acquired upon exercise of an incentive stock option are resold or disposed of before the expiration of the prescribed holding periods, the participant would realize ordinary income, instead of capital gain. The amount of the ordinary income realized would be equal to the lesser of (i) the excess of the fair market value of the stock on the exercise date over the exercise price; or (ii) in the case of a taxable sale or exchange, the amount of the gain realized. Any additional gain would be either long-term or short-term capital gain, depending on whether the applicable capital gain holding period has been satisfied. In the event of a premature disposition of common shares acquired by exercising an incentive stock option, HACII generally would be entitled to a deduction equal to the amount of ordinary income realized by the participant.

Nonqualified Stock Options. A participant generally will not realize any taxable income upon the grant of a Nonqualified Stock Option. At the time the participant exercises the Nonqualified Stock Option, the amount by which the fair market value at the time of exercise of the common shares covered by the Nonqualified Stock Option exceeds the exercise price paid upon exercise will constitute ordinary income to the participant in the year of such exercise. HACII generally will be entitled to a corresponding income tax deduction in the year of exercise equal to the ordinary income recognized by the participant. If the participant thereafter sells such common shares, the difference between any amount realized on the sale and the fair market value of the common shares at the time of exercise will be taxed to the participant as capital gain or loss, short-or long-term depending on the length of time the stock was held by the participant before sale.

Section 162(m) of the Code. Subject to a limited number of exceptions, Section 162(m) of the Code denies a deduction to a publicly held corporation for compensation to its chief executive officer and the three other highest-paid officers (other than its chief executive officer and its chief financial officer) to the extent the individual’s compensation for the taxable year exceeds $1 million. For this purpose, compensation attributable to stock options is included within the $1 million limitation. However, to the extent that certain procedural requirements are met (for example, the Incentive Plan is approved by HACII’s common stockholders, grants are made by a Committee consisting solely of two or more outside directors, the exercise price is equal to the fair market value of the underlying common shares upon grant, etc.), income from the exercise of stock options and stock appreciation rights should not be subject to the $1 million limitation. HACII has attempted to structure the Incentive Plan in such a manner that the compensation attributable to stock options and stock appreciation rights and to performance compensation awards will not be subject to the $1 million limitation. HACII has not, however, requested a ruling from the Internal Revenue Service or an opinion of counsel regarding this issue.

Section 280G of the Code . Under certain circumstances, the granting or enhancement of Awards, the accelerated vesting or exercise of stock options or stock appreciation rights, or the accelerated lapse of restrictions with respect to other Awards, in connection with a change in control may be deemed an “excess parachute payment” for purposes of the golden parachute tax provisions of Section 280G of the Code. To the extent it is so considered, the participant may be subject to a 20% excise tax and HACII may be denied a federal income tax deduction.

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Section 409A of the Code . In general, Awards under the Incentive Plan are intended to be exempt from, or to comply with, the requirements of Section 409A of the Code, which governs the payment of non-qualified deferred compensation. To the extent that the Incentive Plan or Awards under the Incentive Plan fail to comply with the requirements of Section 409A of the Code, participants may be subject to a 20% additional tax and premium interest on payments.

New Plan Benefits

Grants under the Incentive Plan will be made at the discretion of the Committee and, except as noted below, are not yet determinable. In addition, the value of the Awards granted under the Incentive Plan will depend on a number of factors, including the fair market value of HACII common shares on future dates, the exercise decisions made by the participants, and the extent to which any applicable performance goals necessary for vesting or payment are achieved. The closing price of HACII Common Stock as reported on Nasdaq on May 15, 2012 was $9.87.

In connection with the Transaction, the compensation committee of Appleton reviewed the type and amounts of awards to employees which would be granted after the Transaction in lieu of equity-based LTIP and RSU awards previously granted by Appleton. As a result of this review, it is expected that the Committee will grant the following Awards (which such Awards include 108,250 shares of restricted stock, which comprise a portion of the Management Incentive Shares, and 373,000 stock options) under the Incentive Plan on the day of the Closing of the Transaction:

It is expected that the stock options will be granted with an exercise price equal to the fair market value of HACII Common Stock as of the closing date of the Transaction. The vesting schedule for the stock options and shares of restricted stock will be determined by the Committee.

Vote Required

The affirmative vote of the holders of a majority of the issued and outstanding shares of HACII Common Stock entitled to vote thereon as of the record date present in person or represented by proxy at the special meeting of HACII stockholders is required for the Incentive Plan Proposal to be approved. Abstentions will have the same effect as a vote “AGAINST” the Incentive Plan Proposal. Broker non-votes will not be considered present for the purposes of establishing a quorum and will have no effect on the Incentive Plan Proposal.

Board Recommendation

After careful consideration, HACII’s board of directors determined that the Incentive Plan is fair to, and in the best interests of, HACII and its stockholders. On the basis of the foregoing, HACII’s board of directors has approved and declared advisable the Incentive Plan and recommends that you vote or give instructions to vote “FOR” the approval of the Incentive Plan Proposal.

HACII’S BOARD OF DIRECTORS RECOMMENDS THAT HACII STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE INCENTIVE PLAN PROPOSAL.

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THE TRANSACTION PROPOSAL

At the special meeting of HACII stockholders, as previously described in this proxy statement, HACII’s stockholders will be asked to (a) adopt the Equity Purchase Agreement, dated as of May 16, 2012, by and among HACII, the Sponsor, Appleton and PDC, (b) adopt the Cross Purchase Agreement, dated as of May 16, 2012, by and between HACII and PDC, and (c) approve the Transaction, pursuant to which, through a series of transactions, Appleton will become a non-wholly-owned subsidiary of HACII. A copy of the Equity Purchase Agreement and the Cross Purchase Agreement is attached as Annex C and Annex D, respectively, to this proxy statement.

Vote Required

The affirmative vote of the holders of a majority of the issued and outstanding shares of HACII Common Stock entitled to vote thereon as of the record date present in person or represented by proxy at the special meeting of HACII stockholders is required for the Transaction Proposal to be approved. In addition, pursuant to the terms of the Equity Purchase Agreement, HACII shall not redeem or repurchase Public Shares to the extent such redemption or repurchase would result in HACII’s failure to meet a closing condition under the Equity Purchase Agreement that it have at least $82.0 million in trust proceeds after giving effect to the Redemption and repurchases but prior to the payment of the Cash Amount, expenses and certain other amounts.

Abstentions will have the same effect as a vote “AGAINST” the Transaction Proposal. Broker non-votes will not be considered present for the purposes of establishing a quorum and will have no effect on the Transaction Proposal.

Board Recommendation

After careful consideration, each member of HACII’s board of directors determined that the Transaction is fair to, and in the best interests of, HACII and its stockholders (despite potential conflicts of interest of certain of HACII’s directors and officers). On the basis of the foregoing, HACII’s board of directors has approved and declared advisable the Transaction and recommends that you vote or give instructions to vote “FOR” the approval of the Transaction Proposal.

The discussion of the information and factors considered by HACII’s board of directors included in this proxy statement is not meant to be exhaustive, but includes the material information and factors considered by HACII’s board of directors.

HACII’S BOARD OF DIRECTORS RECOMMENDS THAT HACII STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE TRANSACTION PROPOSAL. WHEN YOU CONSIDER THE RECOMMENDATION OF HACII’S BOARD OF DIRECTORS IN FAVOR OF THE TRANSACTION PROPOSAL, YOU SHOULD KEEP IN MIND THAT CERTAIN OF HACII’S DIRECTORS AND OFFICERS HAVE INTERESTS IN THE TRANSACTIONS THAT MAY CONFLICT WITH YOUR INTERESTS AS A STOCKHOLDER. SEE THE SECTION ENTITLED, “THE TRANSACTION—POTENTIAL CONFLICTS OF INTERESTS OF HACII’S DIRECTORS AND OFFICERS IN THE TRANSACTION.”

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THE TRANSACTION

The discussion in this proxy statement of the Transaction and the principal terms of the Purchase Agreements is subject to, and is qualified in its entirety by reference to, the Equity Purchase Agreement and the Cross Purchase Agreement. The full texts of the Equity Purchase Agreement and the Cross Purchase Agreement are attached hereto as Annex C and Annex D, respectively, and are incorporated into this proxy statement by reference.

General Description of the Transaction

On May 16, 2012, HACII entered into the Equity Purchase Agreement and the Cross Purchase Agreement, pursuant to which, through a series of transactions, Appleton will become a non-wholly owned subsidiary of HACII.

Pursuant to the Equity Purchase Agreement, Appleton will convert from a Delaware corporation to a Delaware limited liability company and issue to PDC 9,632,024 Appleton Class B Units, plus certain additional Appleton Class B Units, which we refer to as the Over-the-Top Units, in an amount to be determined by the parties prior to closing. At the closing of the Equity Purchase Agreement, HACII will acquire an aggregate number of Appleton Class A Units equal to (a) the number of shares of HACII Common Stock issued and outstanding after giving effect to the Redemption and certain permitted repurchases of shares of HACII Common Stock in connection with the Transaction, less (b) the number of Over-the-Top Units. In exchange, HACII will pay to Appleton an amount in cash equal to the amount held in the trust account less (i) amounts used by HACII to make permitted repurchases of Public Shares, (ii) amounts payable to HACII Public Stockholders that properly exercise their redemption rights, (iii) the Cash Amount payable to HACII Public Warrantholders, and (iv) the aggregate costs, fees and expenses incurred by HACII in connection with its pursuit of an initial business combination (including deferred underwriting commissions) and other working capital expenses.

One day after the closing of the transactions contemplated by the Equity Purchase Agreement, pursuant to the Cross Purchase Agreement, PDC will sell the Over-the-Top Units to HACII, which HACII will immediately surrender to Appleton for cancellation and, upon its receipt thereof, Appleton will issue to HACII a number of Appleton Class A Units equal to the number of cancelled Over-the-Top Units. In exchange, (i) HACII will issue to PDC 481,601.2 shares of HACII Series A Preferred Stock, (ii) PDC will be entitled to receive, to the extent it becomes due and payable in accordance with the terms of the Cross Purchase Agreement, up to an aggregate of 3.0 million shares of HACII Common Stock, or the Contingency Consideration, which will be issued upon the achievement of certain stock price targets based upon the trading price of the HACII Common Stock, and (iii) PDC will be allocated 85% of certain tax-related benefits arising out of the Transaction pursuant to a Tax Receivable Agreement to be entered into between HACII and PDC, or the Tax Receivable Agreement. Each share of HACII Series A Preferred Stock that PDC will receive pursuant to the Cross Purchase Agreement represents 20 votes, so the 481,601.2 preferred shares issued to PDC in the Transaction will give PDC voting power at HACII equivalent to its ownership interest in Appleton. Pursuant to the terms of the Voting Trust Agreement, PDC will then transfer its shares of Series A Preferred Stock to the Voting Trustee, who will vote such shares at the direction of the ESOP participants. Appleton Class B Units are exchangeable into shares of HACII Common Stock on a one-for-one basis on the terms set forth in an Exchange and Support Agreement among HACII, PDC and Appleton, or the Exchange Agreement, and, upon each such exchange, one-twentieth of a share of HACII Series A Preferred Stock will be automatically redeemed. For each share of HACII Common Stock that is issued under the Exchange Agreement, a new Appleton Class A Unit will be issued to HACII.

A condition to the closing of the transactions contemplated by the Equity Purchase Agreement is that, after giving effect to the Redemption and any permitted repurchases of Public Shares, not less than $82.0 million remains in the trust account. Assuming that exactly $82.0 million remains in the trust account after the Redemption and any such repurchases, upon the closing of the Transaction, HACII’s Appleton Class A Units will represent an approximate 54.5% ownership interest in Appleton and holders of HACII Common Stock will

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control approximately 54.5% of the voting power of HACII, with PDC (either directly or through a wholly-owned subsidiary) holding the remaining ownership interests in Appleton and voting power of HACII. In the event that no HACII Public Stockholders elect to redeem their shares of HACII Common Stock and HACII does not make any permitted repurchases, upon the closing of the Transaction, HACII’s Appleton Class A Units will represent an approximate 65.5% ownership interest in Appleton and holders of HACII Common Stock will control approximately 65.5% of the voting power of HACII, with PDC (either directly or through a wholly-owned subsidiary) holding the remaining ownership interests in Appleton and voting power of HACII. See the section entitled “ Beneficial Ownership of Securities ” for more information regarding the post-Transaction ownership. Therefore, immediately following the consummation of the Transaction, PDC (either directly or through a wholly-owned subsidiary) will hold between approximately 45.5% and 34.5% of the ownership interests in Appleton and the voting power of HACII, depending on the number of redemptions and permitted repurchases. Accordingly, the interests of the current HACII stockholders in HACII and Appleton will be proportionately diluted according to PDC’s interests in each of HACII and Appleton.

For a more detailed description of the Transaction, please see the section entitled “ The Purchase Agreements .”

Background of the Transaction

The terms of the Purchase Agreements are the result of negotiations between representatives of HACII, Appleton and PDC. The following is a brief discussion of the background of these negotiations and the Transaction.

HACII is a blank check company that was organized under the laws of the State of Delaware in June 2010. HACII was formed to acquire, or acquire control of, through a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination one or more businesses or assets.

On October 14, 2010, HACII consummated the IPO of 15,000,000 HACII units, each consisting of one share of HACII Common Stock and one HACII Public Warrant, which is exercisable for an additional share of HACII Common Stock at an exercise price of $12.00 per warrant, and received proceeds of approximately $142.5 million, net of underwriting discounts and commissions and expenses of approximately $7.5 million, excluding deferred underwriting discounts and commissions placed in a trust account pending completion of a business combination. Simultaneously with the consummation of the IPO, HACII consummated the private sale of 6,666,667 Sponsor Warrants to the Sponsor at a price of $0.75 per warrant for an aggregate purchase price of $5.0 million. The proceeds of this private placement were also placed in the trust account. The proceeds outside of the trust account as well as up to $2.25 million, subject to adjustment, in interest income (net of franchise and income taxes payable), earned on the trust account balance may be released to HACII to be used to pay for business, legal and accounting due diligence on prospective acquisitions and continuing general and administrative expenses; provided, however, that after such release there remains in the trust account a sufficient amount of interest income previously earned on the trust account balance to pay any taxes on such $2.25 million of interest income. As of March 31, 2012 HACII had withdrawn approximately $226,000 in interest income to pay franchise taxes.

At no time prior to the consummation of the IPO did HACII, or any of its officers, directors, advisors, consultants or affiliates, have discussions with any person regarding an acquisition of, or a business combination with, Appleton.

Subsequent to the consummation of the IPO on October 14, 2010, HACII commenced efforts to identify and evaluate potential acquisitions with the objective of consummating a business combination. HACII identified certain criteria that it looked for in evaluating prospective target businesses and business combination opportunities, including, without limitation, the following:

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In the months following the IPO, HACII screened potential targets based upon the following characteristics:

In addition, HACII’s management attempted to identify potential targets by initiating conversations with (i) management’s own network of business associates and friends, (ii) third-party companies that management believed could make attractive business combination partners and (iii) professional service providers (lawyers, accountants, consultants and investment bankers). HACII educated these parties on its structure as a special purpose acquisition company and its criteria for an acquisition. HACII also responded to inquiries from investment bankers or other similar professionals representing companies engaged in sale or financing processes. Furthermore, HACII’s management conducted independent market research to identify potential acquisition opportunities. From time to time, HACII’s database of potential acquisition candidates was updated and supplemented based on additional information derived from these discussions with third parties.

HACII’s board of directors was updated on a regular basis with respect to the status of the business combination search. Input received from HACII’s board of directors was material to management’s evaluation of potential business combinations.

The screening and sourcing efforts through HACII’s professional network and independent research resulted in over a hundred potential targets. These opportunities were evaluated based on HACII’s stated criteria. Many did not fit HACII’s screening criteria, while some were eliminated due to an insufficient enterprise value or indications that the sellers’ valuation expectations were too high. The screening process was repeated multiple times, and HACII remained in continual dialogue with its sourcing network. Through these efforts, the volume of potential targets remained high.

HACII declined to move forward on some opportunities because it did not believe the financial characteristics, industry profile and/or position, management teams, attainable valuations and/or deal structures were suitable in light of the screening criteria detailed above. There were also companies that were not interested in pursuing a deal with HACII based on its publicly-traded status, capital structure or questions regarding HACII’s ability to timely consummate a transaction. Other companies accepted competitive bids from other acquirers or attempted their own initial public offerings.

Some companies were deemed, based on HACII’s screening efforts and criteria evaluation, as appropriate targets and were advanced to the next phase of the selection process, including, among others, several oilfield services companies, a manufacturer, designer and distributor of high-precision, large diameter gears and gear boxes, a cooler manufacturer, a manufacturer of glass bottles and other containers, a designer and manufacturer of high quality glassware, flatware and dinnerware and a firearms and ammunition manufacturer. However, most

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of these companies, other than the oilfield services companies, did not advance beyond initial stages of discussion. Non-disclosure agreements (and trust waivers) were executed and preliminary discussions were initiated with these potential targets. From this refined pool of potential targets, several companies were further pursued, and in some instances, HACII had substantive discussions, conducted extensive due diligence, and engaged the potential sellers in a negotiation process.

HACII’s most significant negotiations with potential targets other than Appleton occurred between the middle of 2011 and the beginning of 2012 with two separate oilfield services companies, each of which provides similar pressure pumping, hydraulic fracturing and other related services to oil and gas exploration and production companies in the United States. HACII performed significant due diligence with respect to both of these companies, engaged in extensive discussions with management of each company and negotiated draft acquisition agreements with each company. HACII ultimately elected to not pursue a business combination with either of these potential targets primarily due to market conditions in the domestic oilfield services industry. Oil and natural gas prices rose to record levels in 2008 and then began to decline in late 2008 in conjunction with the widespread economic recession. While the price of oil rebounded somewhat in 2009 and continued to rise throughout 2010 and 2011, the price of natural gas has continued to fall since 2009 largely due to discoveries of vast new natural gas resources in the United States, aided by advances in high horsepower hydraulic fracturing and horizontal and directional drilling. The redeployment of hydraulic fracturing fleets from regions of the country that are predominated by gas-oriented discoveries to regions of the country that are predominated by oil-oriented discoveries resulted in increased competition for oilfield services contracts, including hydraulic fracturing pricing. This combination of low natural gas prices coupled with enhanced competition for contracts, among other factors, created a risk that each of these target companies would be forced to decrease the prices for its services, which would likely have a negative impact on revenues and financial performance. These industry trends were reflected in the stock performance of comparable publicly-traded oilfield services companies, which continued to worsen as negotiations with each of these two target companies progressed. As a result of these factors, HACII decided to discontinue negotiations with each of these two companies by early 2012.

HACII first engaged in discussions with Appleton in May 2011. However, at the time HACII was actively pursuing discussions with several companies, so it elected to postpone further business combination discussions with Appleton. Since May 2011, certain developments, including those described under “—HACII’s Board of Directors’ Reasons for the Approval of the Transaction” below, had caused HACII to renew its interest in pursuing a potential business combination with Appleton. In mid-April 2012, representatives of HACII resumed discussions with Appleton and Jefferies & Company, Inc., or Jefferies, as financial and capital markets advisor to Appleton, regarding the pursuit of a potential business combination.

On April 24, 2012, HACII’s board of directors met to discuss and review with management prospective acquisition targets, as it had recently during prior board meetings on March 1, 2012 and April 13, 2012. During the April 24, 2012 board meeting, management made a presentation with respect to Appleton and mentioned that members of management would be traveling to Appleton, Wisconsin later to further evaluate a potential transaction. The board then discussed the business prospects and financial results from the presentation with management. It was determined that management would continue to evaluate Appleton, among other potential acquisition targets.

On the evening of April 24, 2012, HACII’s management met with Jefferies and the management of Appleton and continued discussions the next day at the offices of Appleton to discuss a potential transaction.

On Friday, April 27, 2012, representatives from HACII, including Thomas O. Hicks and Christina Weaver Vest, HACII’s legal advisor, Akin Gump Strauss Hauer & Feld LLP, or Akin Gump, HACII’s accountants, KPMG LLP, or KPMG, and Appleton met via telephone to discuss a possible business combination opportunity. HACII, KPMG and Akin Gump commenced due diligence review of Appleton. On April 30, 2012, the HACII board of directors held a meeting to discuss matters relating to a potential business combination with Appleton and approved the pursuit of further discussions, and the execution of a nonbinding letter of intent was entered

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into with Appleton the following day. Negotiations between Appleton and HACII focused on the share consideration to be paid in the Transaction, with particular attention to the number of Appleton Class B Units to be issued to PDC, the aggregate transaction expenses, the number and terms of any earn-out shares to be issued in connection with the Transaction, and the respective ownership percentages of HACII and PDC in Appleton and of PDC in HACII.

On May 1, 2012, DLA Piper LLP, or DLA Piper, legal advisor to Appleton, circulated an initial draft of the Equity Purchase Agreement. Over the next several days, the parties engaged in extensive negotiations and the exchange of multiple drafts of the Equity Purchase Agreement. Representatives from HACII, including Thomas O. Hicks and Christina Weaver Vest, and representatives from Appleton, including Mark R. Richards and Thomas J. Ferree, also held several telephonic meetings during this period to further discuss HACII’s due diligence review of Appleton, the timing of the Transaction, and the structure of the Transaction. In addition, during this period, there were frequent communications between HACII and Appleton and their respective counsel and other advisors regarding due diligence and transaction terms.

In connection with the Transaction, HACII engaged Deutsche Bank as financial advisor and KPMG as accountants to assist in HACII’s review of the Transaction.

Due diligence conducted by HACII with respect to Appleton included:

On May 4, 2012, HACII’s board of directors held meetings to discuss with the officers of HACII updates on the prospective transaction with Appleton and to discuss diligence findings and listen to presentations regarding the potential transaction by HACII officers. After discussions with management, it was determined that a follow-up board meeting would be held on May 10, 2012 so that the board of directors could receive updated information on the transaction. On May 10, 2012, HACII’s board of directors held a follow-up board meeting with officers of HACII to continue discussions of due diligence and to review the status of legal documentation with respect to the prospective transaction. At the May 10, 2012 board meeting, the board received updated information regarding the transaction from management and in advance of the meeting received a legal due diligence report from HACII’s legal advisors and draft transaction documents. On May 13, 2012 the board met to review due diligence findings, including an accounting due diligence report and to receive updates on the resolution of issues in the transaction documents. Following presentations from management and questions from the board, HACII’s directors and management again discussed the reasons for the recommendation of the transaction with Appleton. See “—  HACII’s Board of Directors’ Reasons for the Approval of the Transaction .” Thereafter, the board of directors agreed to meet the next day to hear an update from management on the status of negotiations.

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Throughout the weeks between May 1, 2012 and May 16, 2012, the parties exchanged drafts of the Equity Purchase Agreement. DLA Piper and Akin Gump also circulated drafts of the Cross Purchase Agreement and the various other documents in connection with the Transaction, and the parties continued to exchange drafts of these documents during the course of negotiations. During this period, Mr. Hicks and Ms. Vest held numerous telephonic meetings with Mr. Richards and Mr. Ferree of Appleton in order to discuss the drafts of the Equity Purchase Agreement and the Cross Purchase Agreement and the other transaction documents being negotiated, with particular focus on the number of Appleton Class B Units to be issued to PDC and the respective ownership percentages of PDC and HACII following the consummation of the Transaction. Negotiations also focused on the minimum cash remaining in the trust account, the use of proceeds, the closing conditions and the mechanics and tax implications of the structure of the Transaction. In exchange for a lower amount of cash remaining in the trust account, the limitations on the use of proceeds were relaxed.

On May 14, 2012, HACII’s board of directors held a telephonic meeting to discuss the prospective transaction with Appleton. During the meeting, the board of directors discussed the valuation of Appleton and considered the current drafts of the various transaction documents, including the Equity Purchase Agreement and the Cross Purchase Agreement. Thereafter, following discussion, the board of directors acted to approve the prospective transaction with Appleton and authorized HACII’s officers to enter into definitive agreements with respect to the Transaction.

On May 16, 2012, the parties finalized and entered into the Equity Purchase Agreement and the Cross Purchase Agreement. On May 16, 2012, HACII publicly announced the execution of the Equity Purchase Agreement and the Cross Purchase Agreement through a press release and commenced investor presentations regarding the Transaction.

On June 20, 2012, the parties entered into an amendment to the Equity Purchase Agreement to:

The Warrant Amendment was contemplated based on investor feedback with respect to concerns about the potential dilutive effect of the current HACII warrant structure. The minimum cash closing condition was agreed upon to help ensure that HACII would continue to meet required net equity requirements for the Nasdaq Capital Market. The possible extension of the dissolution deadline was provided to possibly give flexibility in light of unpredictable market conditions over the next few weeks.

HACII’s Board of Directors’ Reasons for the Approval of the Transaction

Each member of HACII’s board of directors concluded that the Transaction is fair to, and in the best interests of, HACII and its stockholders, and that the consideration to be paid in the Transaction is fair to HACII and its stockholders, despite the fact that some of HACII’s directors and officers have interests that may conflict with HACII stockholders. See the section entitled “ — Potential Conflicts of Interests of HACII’s Directors and Officers in the Transaction .”

HACII’s management conducted a due diligence review of Appleton that included an industry analysis, an evaluation of Appleton’s existing business, a valuation analysis and financial projections in order to enable the board of directors to evaluate Appleton’s business and financial condition and prospects.

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HACII’s board of directors considered various industry and financial data, including certain financial analyses developed by HACII and metrics compiled by HACII’s management, in evaluating the consideration to be paid by HACII in the Transaction. Although HACII’s board of directors did not seek a third party valuation in connection with the Transaction, the board of directors considered valuation information regarding Appleton, including industry comparisons of the enterprise values of Appleton and several of its largest competitors, projections and comparisons of EBITDA, the growth outlook for the end markets that Appleton serves, the abilities of Appleton’s management team, free cash flow characteristics, the specialty nature of Appleton’s operations, dividend yields, capital expenditures, total net debt, and ratios of total enterprise value to pro forma EBITDA and of total enterprise value to EBITDA minus capital expenditures, or free cash flow. The board also considered the dilutive effect of the exchange by PDC of the Appleton Class B Units for shares of HACII Common Stock. In making its determination that the Transaction is fair to, and in the best interests of, HACII and its stockholders, and that the consideration to be paid in the Transaction is fair to HACII and its stockholders, the board of directors considered the amount of cash available in the trust account, the rollover equity incentives for the ESOP participants as the ultimate recipients of ownership interests in HACII and the value of the potential benefits to be derived from the Tax Receivable Agreement, in relation to a total enterprise value of Appleton of approximately $675.0 million.

HACII’s board of directors considered a wide variety of factors in connection with its evaluation of the Transaction. In light of the complexity of those factors, the board did not consider it practicable to, nor did it attempt to, quantify or otherwise assign relative weights to the specific factors it considered in reaching its decision. Furthermore, individual members of the board may have given different weight to different factors.

Favorable Factors

In considering the proposed Transaction, HACII’s board of directors gave considerable weight to the following favorable factors:

Domtar Supply Agreement

On February 22, 2012, Appleton entered into a long-term supply agreement with Domtar Corporation, or Domtar, to purchase carbonless and thermal stock supply. Pursuant to the terms of the supply agreement, Domtar will become Appleton’s exclusive supplier of carbonless and thermal stock for a period of fifteen years, with successive five-year renewals. The supply agreement allows Appleton to eliminate marginal business lines and reduce working capital, fixed assets and overhead costs. The supply agreement also allows Appleton to dispose of certain assets at its West Carrolton, Ohio facility and move certain operations to its Appleton, Wisconsin facility. The board of directors believes that the supply agreement will result in many benefits for Appleton, including improvements to cash flow and EBITDA.

Encapsys

Appleton’s Encapsys business segment discovers, develops and manufactures microencapsulation solutions for external partner companies and for Appleton’s carbonless papers business segment. Microencapsulation is the process of putting a microscopic wall around a core substance. The board of directors believes that the Encapsys business segment will allow Appleton to explore opportunities with potential partners in industries as diverse as agriculture, paints and coatings, food, pharmaceuticals, paper, textiles, personal and household care, adhesives, and oil and gas. Procter & Gamble is one of the leading consumer product companies in the world and is a key strategic partner for Encapsys.

Thermal Paper is a Growing Market

Appleton is North America’s leading producer of thermal paper, a versatile substrate used to make tag, label and entertainment products as well as retail, restaurant and ATM receipts. Appleton is credited with commercializing thermal paper in the 1960s, and the company continues to be viewed as the leader in innovation today. Thermal paper

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production is a rapidly growing segment of Appleton’s operations. In the first quarter of 2012, the EBITDA from Appleton’s thermal paper segment increased by 46% as compared to the same period of the prior year.

Carbonless Paper Provides Substantial Cash Flow

Appleton has long been the world’s largest manufacturer of carbonless paper, a product the company helped introduce nearly 60 years ago. NCR PAPER and Appleton brands are among the most well-recognized and respected in the industry, resulting in the company’s status as one of the two primary competitors in the North American market. The carbonless segment generates substantial free cash flow that can be re-invested in segments with better growth prospects such as thermal paper and Encapsys.

Talented Management Team

Appleton is led by a strong core group of managers who are responsible for the recent strategic initiatives, including the Domtar supply agreement, and who have overseen a period of growth in profits. These executives have substantial tenure in both the specialty paper industry from their time at Appleton and in other manufacturing industries. Appleton has public indebtedness outstanding, and as such its management team is responsible for making regular filings with the SEC. The management team is also already accustomed to maintaining strong investor relations by communicating with investors via quarterly earnings calls and industry conferences.

Other Factors

HACII’s board of directors also considered potentially negative factors. The potentially negative factors considered by the board, which are more fully described in the “ Risk Factors ” section of this proxy statement, included the following:

The risk that HACII Public Stockholders would vote against the Transaction Proposal or exercise their redemption rights

HACII’s board of directors considered the risk that some of the current HACII Public Stockholders would vote against the Transaction Proposal or decide to exercise their redemption rights, thereby depleting the amount of cash available in the trust account. Further, HACII’s board of directors also considered the risk that HACII may need to purchase Public Shares prior to the Transaction, thereby even further depleting available cash. The board concluded that Appleton will still be able to implement its business plan even if the maximum number of HACII Public Stockholders exercised their redemption rights and if HACII needed to purchase Public Shares.

Thomas O. Hicks, William F. Quinn, William A. Montgomery and James C. Musselman may have different interests in the Transaction than the HACII Public Stockholders

HACII’s board of directors considered the fact that Thomas O. Hicks, William F. Quinn, William A. Montgomery and James C. Musselman may have interests in the Transaction that are different from, or are in addition to, the interests of HACII stockholders generally, including the matters described under “ —Potential Conflicts of Interests of HACII Directors and Officers in the Transaction ” below. However, this fact would exist with respect to a business combination with any target company, and the board of directors does not believe that the potentially disparate interests in the Transaction are an issue.

Appleton was previously named as a potentially responsible party under CERCLA related to the Lower Fox River Superfund Site

The Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, also known as the “Superfund” law, and comparable state laws impose strict and joint and several liability, without regard to

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fault or legality of the original conduct, on classes of persons considered to be responsible for the release of a “hazardous substance” into the environment. These persons include the current owner or operator of the site where the release occurred, prior owners or operators that owned or operated the site at the time of the release or disposal of hazardous substances and anyone who disposed or arranged for the disposal of a hazardous substance released at the site. Under CERCLA and comparable state statutes, such persons deemed “responsible parties” may be subject to joint and several and strict liability for removing or remediating previously disposed wastes (including wastes disposed of or released by prior owners or operators) or property contamination (including groundwater contamination), for damages to natural resources and for the costs of certain health studies. In addition, it is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damage allegedly caused by the hazardous substances released into the environment. As described in the following risk factor, Appleton was previously identified as a potentially responsible party, or a PRP, under CERCLA for remediation of polychlorinated biphenyl, or PCB, contamination and alleged natural resources damages related to the Lower Fox River and Green Bay system, which is collectively referred to in this proxy statement as the Lower Fox River.

On July 28, 1998, the EPA placed the Lower Fox River on the National Priorities List of Contaminated Sites pursuant to CERCLA. Appleton was named a PRP with respect to historic discharges of PCBs into the Lower Fox River. Carbonless paper containing PCBs was manufactured at what is currently the Appleton plant from 1954 until 1971. During this period, wastewater containing PCBs was discharged into the Lower Fox River from a publicly-owned treatment works, from the Appleton plant, from the Combined Locks, Wisconsin paper mill and from other local industrial facilities. Wastewater from the Appleton plant was processed through the publicly-owned treatment works. Appleton purchased the Appleton plant and the Combined Locks, Wisconsin paper mill from NCR in 1978, long after discovery of the use of PCBs in the manufacturing process. The EPA issued an administrative order in November 2007, directing the PRPs to implement the remedial action of the Lower Fox River pursuant to which certain of the PRPs commenced remediation in 2008. The EPA, Wisconsin Department of Natural Resources, or the DNR, and the various PRPs, including NCR, continue to contest the scope, extent and costs of the remediation as well as the appropriate bases for determining the individual parties’ relative share of the remediation cost. Appleton has continuously maintained the EPA erred in naming it a PRP. On April 10, 2012, the United States District Court for the Eastern District of Wisconsin agreed and granted Appleton’s motion for summary judgment and dismissed all claims against it in the enforcement action, U.S. v. NCR Corporation et al. , Case. No. 10-C-910. The decision establishes that Appleton is no longer a PRP, no longer liable under CERCLA, no longer considered a legal successor to NCR’s liabilities, and no longer required to comply with the 106 Order commanding remediation of the Lower Fox River.

Notwithstanding the April 10, 2012 ruling, Appleton remains obligated to share in a significant portion of NCR’s joint defense and liability costs in accordance with the terms of a 1998 settlement agreement and a 2006 arbitration determination, collectively known as the Cost Sharing Agreements, arising out of Appleton’s acquisition of assets from NCR in 1978 while it was a subsidiary of B.A.T Industries Limited, or BAT. Appleton and BAT have joint and several liability under the Cost Sharing Agreements. Since NCR remains a PRP, Appleton stands to bear financial responsibility for a significant portion of NCR’s costs of remediating the PCBs that remain in the Lower Fox River. Indeed, on April 27, 2012, the U.S. District Court for the Eastern District of Wisconsin issued a preliminary injunction requiring NCR immediately to resume remediation of the Lower Fox River and to dredge at least 660,000 cubic yards of contaminated sediment from the River, referred to as the Preliminary Injunction. Remediation of this area is estimated at $82.0 million. Additionally, the Court found the harm to the Lower Fox River is “indivisible,” thus leaving the door open for the EPA to demand that NCR alone complete the remediation. Although NCR can seek contribution from other PRPs, future and ongoing costs to remediate the Lower Fox River could be material to Appleton’s financial position. The EPA and the DNR issued two Records of Decision, or RODs, in 2003 estimating the total costs for the Lower Fox River remedial action at approximately $400 million. Other estimates obtained by the PRPs range from a low of $450 million to as much as $1.6 billion. More recent estimates place the cost to remediate operable units 2-5 between $594 million and $900 million. Various government agencies are also asserting that NCR and the other PRPs are liable for natural resources damages caused by the PCBs. In 2000, the U.S. Fish & Wildlife Service estimated that total natural

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resources damages would be in the range of $176 million to $333 million for all PRPs in the aggregate. To date, Appleton has funded approximately $260 million toward the Lower Fox River remediation, with nearly all of its liability, both direct and through NCR, covered by an indemnity from Arjo Wiggins Appleton p.l.c., now known as Windward Prospects Ltd., or AWA. AWA has funded such payments through a $250 million indemnity insurance policy, which has now been exhausted. It is unclear whether AWA can continue to fund Appleton’s share of the remediation, particularly at the higher end of the cost estimates. To the extent AWA fails to satisfy its indemnity obligations, Appleton would be responsible for a significant portion of NCR’s share, and could also have direct responsibility should the regulatory agencies successfully overturn the April 10, 2012 decision on appeal. Even if Appleton remains responsible for only a significant portion of NCR’s share, the potential liability could be significant, which could have a material adverse effect on Appleton and its results of operations.

In November 2007, the EPA issued an administrative order directing the PRPs to implement the remedial action of the Lower Fox River pursuant to which certain of the PRPs commenced remediation in 2008. In October 2010, the United States and the State of Wisconsin filed a lawsuit on behalf of the EPA and the DNR, respectively, against ten companies, including Appleton, and two municipalities seeking recovery of unreimbursed response costs and natural resources damages as well as a declaratory judgment that the defendants are liable for future response costs related to the Lower Fox River. A trial date for this matter is tentatively scheduled for December 3, 2012. If the EPA and the DNR obtain a favorable ruling, Appleton will be required to share in a significant portion of these costs with NCR. If AWA is unable to meet its indemnity obligations to Appleton, this pending litigation could have a material adverse effect on the Company and its results of operations.

Prior to its dismissal as a PRP for the Lower Fox River Superfund Site, Appleton hired experts to evaluate its share of liability at the site. The EPA’s and the DNR’s liability estimates attributable to Appleton and NCR range between 30-40%. Appleton’s experts, however, apportioned liability at a much lower 8-10% range. Under the 8-10% estimate, Appleton believes it has already paid more than its estimated share of the liability. In its Preliminary Injunction decision, the U.S. District Court for the Eastern District of Wisconsin seemed to reject NCR’s attempts to apportion liability given the indivisibility of the harm. As such, it is uncertain whether NCR (and Appleton) can successfully persuade the same court to reduce its apportioned liability. To the extent Appleton and NCR can demonstrate they remediated more than they contributed, they would be able to seek “contribution” from other PRPs; however, one of the larger PRPs is immune to such contribution action as a result of its own settlement with the EPA.

Appleton believes the Lower Fox River remediation will cease upon completion of operable unit 5 (Green Bay). The EPA could, however, decide to investigate Lake Michigan for possible PCB contamination stemming from the Lower Fox River and deem it necessary to continue remediation beyond the current boundaries of operable unit 5. If the remediation is continued into Lake Michigan, Appleton will be required to share in a significant portion of these additional costs with NCR and the impact on Appleton’s financial condition could be material.

Appleton’s former parent, AWA, may fail to comply with its indemnification obligations related to the acquisition of Appleton

Appleton is the beneficiary of two indemnification agreements entered into in 2001 wherein AWA agreed to indemnify PDC and PDC agreed to indemnify Appleton for costs, expenses and liabilities related to certain governmental and third-party environmental claims (including certain claims under the Cost Sharing Agreements), which are defined in the agreements as the Fox River Liabilities. Appleton has recorded a $46.4 million environmental indemnification receivable as of April 1, 2012. To date, AWA has funded its indemnity obligations through a $250 million indemnity insurance policy, which has now been exhausted. It is unclear whether AWA can continue to fund Appleton’s share of the remediation, particularly at the higher end of the cost estimates.

As amended in and as limited by the terms of the purchase agreement relating to the acquisition of Appleton, AWA and two of its affiliates have agreed to indemnify PDC and Appleton for certain losses resulting from (1) inaccuracies in the environmental representations and warranties made by AWA and its affiliates,

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(2) certain known environmental matters that existed at the closing of the acquisition, (3) environmental matters related to the businesses of Newton Falls, Inc., Appleton Coated LLC and several other of Appleton’s former affiliates and subsidiaries and (4) environmental matters relating to the real property on which Appleton’s former Camp Hill, Pennsylvania plant and Appleton’s current distribution center are located that existed prior to its sale of the Camp Hill plant to a third party. Indemnification of these matters could further limit AWA’s ability to meet its indemnity obligations for the Lower Fox River remediation.

If the indemnified matters result in significant liabilities for Appleton, and AWA and/or its affiliates are unable or unwilling to honor these indemnification obligations, Appleton could be required to pay for these liabilities, which could materially adversely affect its business, financial condition and results of operations.

Appleton may have cleanup liabilities for the West Carrollton Mill

The West Carrollton, Ohio mill operates pursuant to various state and federal permits for discharges and emissions to air and water. As a result of the de-inking of carbonless paper containing PCBs through the early 1970s, there have been releases of PCBs and volatile organic compounds into the soil in the area of the wastewater impoundments at the West Carrollton facility and, in 2001, low levels of PCBs were detected in the groundwater immediately under this area. In addition, PCB contamination was discovered in sediment in the adjacent Great Miami River, but it is believed that this contamination is from a source other than the West Carrollton mill.

The Ohio Environmental Protection Agency, or the Ohio EPA, is presently conducting a biological and water quality survey of the Lower Great Miami River Basin. The study is expected to conclude in 2013. The West Carrollton mill’s waste water discharges into the Great Miami River are included in the study’s scope. The Ohio EPA’s 2012 fish consumption advisory discourages the public from consuming certain types of fish due to PCB, lead and mercury contamination concerns.

Based on the limited 2001 investigation and delineation of PCB contamination in soil and groundwater in the area of the wastewater impoundments, Appleton believes that it may be necessary to undertake remedial action in the future, although Appleton is currently under no obligation to do so. Appleton has not had any discussions or communications with any federal, state or local agencies or authorities regarding remedial action to address PCB contamination at the West Carrollton mill. The cost for remedial action, which could include installation of a cap, long-term pumping, treating and/or monitoring of groundwater and removal of sediment in the Great Miami River, was estimated in 2001 to range up to approximately $10.5 million, with approximately $3 million in short-term capital costs and the remainder to be incurred over a period of 30 years. However, costs could exceed this amount if additional contamination is discovered, if additional remedial action is necessary or if the remedial action costs are more than expected.

Given the uncertainty surrounding the ultimate course of action for the West Carrollton mill property, the Great Miami River remediation and Appleton’s share of these remediation costs, if any, and since Appleton is currently under no obligation to undertake remedial action in the future, no provision has been recorded in its financial statements for estimated remediation costs. In conjunction with the acquisition of PDC by the ESOP in 2001, and as limited by the terms of the purchase agreement, AWA agreed to indemnify PDC for 50% of all environmental liabilities at the West Carrollton mill for the first $5.0 million in costs and damages and 100% of any costs and damages thereafter. The aggregate indemnity cap under the 2001 purchase agreement is $93 million. Unlike the Lower Fox River indemnity, AWA does not maintain insurance to fund this indemnity. AWA’s ability to meet its indemnity obligations for the West Carrollton mill is uncertain. In addition, the former owners and operators of the West Carrollton mill may be liable for all or part of the cost of remediation of the historic PCB contamination.

Risks associated with underfunded pension liabilities

HACII’s board of directors considered the risk that the total projected benefit obligation of Appleton’s defined benefit pension plans exceeded the fair value of the plan assets by $125.8 million on December 31, 2011.

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However, Appleton is forecasting a contribution to the plans of $25 million in 2012, and the board of directors believes that the risks related to Appleton’s underfunded pension liabilities are within the range of those seen in other publicly traded companies in the industry.

Risks associated with outstanding debt instruments

HACII’s board of directors considered the potential risks associated with Appleton’s substantial amount of outstanding indebtedness, which was approximately $512.0 million as of April 1, 2012. However, during the course of the due diligence process, HACII’s board of directors considered Appleton’s debt position with respect to the possible de-levering that would occur in connection with the consummation of the Transaction, the possible opportunities to refinance the remaining indebtedness following the consummation of the Transaction, Appleton’s expected ability to generate strong free cash flow, the limited maintenance capital expenditure needs of Appleton and the stability of Appleton’s raw material inputs.

HACII’s board of directors also considered the risk that Appleton’s current outstanding debt instruments constrain Appleton’s activities, including certain rights that would be triggered upon consummation of the Transaction. In connection with Appleton’s entry into the Equity Purchase Agreement, Appleton agreed to solicit certain amendments to, or waivers from, its current outstanding debt instruments in order to permit the consummation of the Transaction. The board of directors believes that Appleton will be able to secure the amendments and consents necessary in order to permit the consummation of the Transaction without violating the restrictive covenants in Appleton’s outstanding debt instruments.

Risks associated with net losses

HACII’s board of directors considered Appleton’s net losses, but believes that such losses could be mitigated in the future due to the benefits Appleton could realize from the supply agreement with Domtar, including the elimination of marginal business lines, reduction of working capital, fixed assets and overhead costs, and disposition of certain assets at its West Carrolton, Ohio facility, potential multi-faceted growth from the Encapsys business segment, Appleton’s expected free cash flow generation possibilities, and the possible de-levering that would occur in connection with the consummation of the Transaction.

The cessation of papermaking and transition to base stock supplied under the Domtar long-term supply agreement may take longer or cost more than planned

Appleton has developed plans to cease papermaking operations in West Carrollton and transition to replacement base stock supplied under the Domtar long-term supply agreement. Though management has not yet finalized the specific actions to be taken, Appleton expects to incur substantial costs to effect the transition over a defined period and anticipates it will be able to fund those costs with manufacturing cost savings, working capital reductions and normal operations. However, the success of the transition depends on the ability of this supplier to manufacture paper that meets Appleton’s specifications, the ability of Appleton to successfully coat the replacement base stock to meet the requirements of Appleton’s customers, and acceptance of the products by customers and the successful use in their businesses. If difficulties develop in the transition process, the time and expense associated with the transition may expand beyond planned periods and amounts and Appleton’s business, financial condition and results of operations may be materially adversely affected.

Potential Conflicts of Interests of HACII’s Directors and Officers in the Transaction

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Therefore, based on the $25,000 and $5.0 million purchase price paid by the Sponsor for the Founder Shares and the Sponsor Warrants, respectively, if the Transaction is consummated:

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