August 12, 2025

Dear Shareholders:

The board of directors (the “Board”) of Theratechnologies Inc. (the “Corporation”) cordially invites you to attend a special meeting (the “Meeting”) of the holders (the “Shareholders”) of common shares of the Corporation (the “Shares”) to be held in a hybrid format on Friday, September 12, 2025 at 10:00 a.m. (Eastern time), in person at the offices of Fasken Martineau DuMoulin LLP located at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada and virtually via live audio webcast at https://meetnow.global/MDUWLGW. We hope that hosting a hybrid meeting will increase shareholder participation as it will enable shareholder attendance regardless of geographic location.

Details of the Proposed Plan of Arrangement

At the Meeting, pursuant to the interim order of the Superior Court of Québec (the “Court”), as the same may be amended, Shareholders will be asked to consider and, if deemed advisable, to pass, with or without variation, a special resolution (the “Arrangement Resolution”) approving a statutory plan of arrangement (the “Arrangement”) under Chapter XVI – Division II of the Business Corporations Act (Québec) involving the Corporation and CB Biotechnology, LLC (the “Purchaser”), an affiliate of Future Pak, LLC (“Future Pak”), as more particularly described in the accompanying notice of special meeting of Shareholders and management proxy circular (the “Circular”).

Under the terms of the Arrangement, among other things, the Purchaser will acquire all of the issued and outstanding Shares for US$3.01 in cash per Share (the “Cash Consideration”) and one (1) contingent value right to be issued by the Purchaser (a “CVR” and together with the Cash Consideration, the “Consideration”), less any applicable withholdings, subject to the terms and conditions of the arrangement agreement (the “Arrangement Agreement”) dated July 2, 2025 among the Purchaser, Future Pak and the Corporation.

The Cash Consideration offered to the Shareholders under the Arrangement and the Consideration (assuming maximum payment of the CVR) represent substantial and compelling premiums of 126% and 216%, respectively, to the closing price on the Nasdaq Capital Market on April 10, 2025, the date prior to the announcement of Future Pak’s initial non-binding proposal, and of 90% and 165%, respectively, to the 30-day volume weighted average share price for the period ending on April 10, 2025.

Unanimous Board Recommendation

The Arrangement Agreement is the result of a review of strategic alternatives available to the Corporation that was led by a Special Committee comprised solely of independent directors of the Corporation (the “Special Committee”).

After careful consideration, and after consulting with outside legal and financial advisors and having taken into account such factors and matters as it considered relevant, including, among other things, the unanimous recommendation of the Special Committee, the Board has unanimously determined that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders. Accordingly, the Board has unanimously approved the Arrangement and recommends that Shareholders vote FOR the Arrangement Resolution. A full description of the information and factors considered by the Board and the Special Committee is set forth under the heading “The Arrangement – Reasons for the Arrangement” in this Circular.

Fairness Opinions

Barclays Capital Inc., as exclusive financial advisor to the Corporation, and Raymond James Ltd., retained to provide independent financial advisory services to the Special Committee, provided their respective fairness opinion to the Board and the Special Committee, to the effect that, as of July 2, 2025, and based upon and subject to the assumptions, limitations, qualifications and other matters respectively set forth therein, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to such Shareholders. The complete texts of the fairness opinions are attached as Appendix G and Appendix H to this Circular, respectively. Shareholders are urged to read both fairness opinions in their entirety. See “The Arrangement – Fairness Opinions” in this Circular.

 

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Support and Voting Agreements and Significant Shareholder Support

Concurrently with the execution of the Arrangement Agreement, certain senior officers and directors of the Corporation who together own or exercise control or direction over an aggregate of 524,266 Shares, representing in the aggregate approximately 1.14% of the Corporation’s outstanding Shares, have entered into support and voting agreements with the Purchaser, pursuant to which they have agreed, among other things, to vote in favour of the Arrangement Resolution, subject to customary exceptions.

Soleus Capital Master Fund, L.P., holding 10.4% of the outstanding Shares, has informed the Board that it is supportive of the Arrangement and intends to vote in favour of the Arrangement Resolution absent a material change in circumstances.

Approval Requirements

In order for the Arrangement to become effective, Shareholders will be asked to consider and, if deemed advisable, to pass the Arrangement Resolution. The Arrangement Resolution must be approved by (i) at least 66²⁄₃% of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, and (ii) at least a majority of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, excluding Shares required to be excluded pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions.

The Arrangement is subject to customary closing conditions, including approval by the Court. If the necessary approval is obtained and the other conditions to closing are satisfied or waived, it is anticipated that the Arrangement will be completed before the end of the Corporation’s fourth quarter ending November 30, 2025.

Vote Your Shares Today!

Your vote is important regardless of the number of Shares you hold. Whether or not you expect to attend the Meeting, you are urged to vote in advance electronically, by telephone or by mail, by following the instructions set out on the enclosed form of proxy or voting instruction form, as applicable. All proxy forms must be returned to the attention of the Corporation’s transfer agent, Computershare Investor Services Inc., 320 Bay Street, 14th Floor, Toronto, Ontario M5H 4A6, prior to 10:00 (Eastern Time) on September 10, 2025, or, if the Meeting is adjourned or postponed, no later than 48 hours, excluding Saturdays, Sundays and statutory holidays, before any reconvened Meeting.

Shareholders should review the accompanying Circular which describes, among other things, the background to the Arrangement as well as the reasons for the determinations and recommendations of the Special Committee and the Board. The Circular contains a detailed description of the Arrangement, including certain risk factors relating to the completion of the Arrangement. You should consider carefully all of the information in the Circular. If you require assistance, you are urged to consult your financial, legal, tax or other professional advisor. Shareholders are encouraged to visit the Meeting page on the Corporation’s website for information on all relevant Meeting materials at www.theratech.com.

Shareholder Questions and Assistance with Voting

If you have any questions about the information contained in this Circular or require assistance with voting or in completing your form of proxy or voting instruction form, please contact Laurel Hill Advisory Group, our shareholder communications advisor and proxy solicitation agent, by telephone at 1-877-452-7184 (toll-free in North America) or at 1-416-304-0211 (outside of North America), or by email at assistance@laurelhill.com. Questions on how to complete your letter of transmittal should be directed to Computershare Investor Services Inc. by telephone toll-free in North America at 1-800-564-6253 or outside of North America at 1-514-982-7555 or by email to corporateactions@computershare.com.

 

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On behalf of the Corporation, we would like to thank all Shareholders for their continuing support.

Yours very truly,

 

(signed) Frank Holler				(signed) Paul Lévesque
Frank Holler				Paul Lévesque
Chair of the Board and Chair of the Special Committee of				President and Chief Executive Officer and Director
the Board

 

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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

 

NOTICE IS HEREBY GIVEN THAT, pursuant to an interim order of the Superior Court of Québec dated August 8, 2025 (as the same may be amended, the “Interim Order”), a special meeting (the “Meeting”) of the holders (the “Shareholders”) of common shares (the “Shares”) of Theratechnologies Inc. (the “Corporation”) will be held in a hybrid format on Friday, September 12, 2025 at 10:00 a.m. (Eastern time), for the following purposes:

 

(1)

to consider and, if deemed advisable, to pass, with or without variation, a special resolution (the “Arrangement Resolution”), the full text of which is set forth in Appendix C attached to the accompanying management proxy circular (the “Circular”), approving a statutory plan of arrangement (the “Arrangement”) under Chapter XVI – Division II of the Business Corporations Act (Québec) (the “QBCA”) involving the Corporation and CB Biotechnology, LLC (the “Purchaser”), an affiliate of Future Pak, LLC ( “Future Pak”), as more particularly described in the Circular; and

 

(2)

to transact any other business as may properly come before the Meeting or any adjournment(s) or postponement(s) thereof.

The Meeting will be held in a hybrid format, in person at the offices of Fasken Martineau DuMoulin LLP located at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada and virtually via live audio webcast at https://meetnow.global/MDUWLGW. We hope that hosting a hybrid meeting will increase shareholder participation as it will enable attendance regardless of geographic location.

Shareholders are entitled to vote at the Meeting in person or by proxy, with each Share entitling the holder thereof to one (1) vote at the Meeting. The Board of Directors of the Corporation has fixed August 13, 2025 as the record date for determining Shareholders who are entitled to receive notice of, and to vote at, the Meeting or any adjournment(s) or postponement(s) thereof. Only Shareholders whose names have been entered in the register of the Corporation as at the close of business on such date will be entitled to receive notice of, and to vote at, the Meeting or any adjournment(s) or postponement(s) thereof.

Whether or not you are able to attend the Meeting, Shareholders are strongly encouraged to vote in advance electronically, by telephone or by mail, by following the instructions set out on the form of proxy or voting instruction form, as applicable, which accompanies this Notice of Special Meeting of Shareholders. Detailed instructions on how to complete and return proxies and voting instruction forms by mail or e-mail are provided starting on page 25 of the Circular. Proxies must be received by the Corporation’s transfer agent, Computershare Investor Services Inc., 320 Bay Street, 14th Floor, Toronto, Ontario M5H 4A6, Attention: Proxy Department, not later than 10:00 a.m. (Eastern time) on September 10, 2025 (or not later than 48 hours, excluding Saturdays, Sundays and statutory holidays, before any reconvened meeting if the Meeting is adjourned or postponed). Notwithstanding the foregoing, the Chair of the Meeting has the discretion to accept proxies received after such deadline. The time limit for the deposit of proxies may also be waived or extended by the Chair of the Meeting at his discretion, without notice.

Shareholders who hold their Shares through a broker, investment dealer, bank, trust company, custodian, nominee or other intermediary (each, an “Intermediary”), should carefully follow the instructions set forth in the enclosed voting instruction form to ensure that their Shares are voted at the Meeting in accordance with such Shareholder’s instructions, to arrange for their Intermediary to complete the necessary transmittal documents and to ensure that they receive payment for their Shares if the Arrangement is completed.

The voting rights attached to the Shares represented by a proxy in the enclosed form of proxy will be voted in accordance with the instructions indicated thereon. If no instructions are given, the voting rights attached to such Shares will be voted FOR the Arrangement Resolution.

Pursuant to and in accordance with the plan of arrangement attached as Appendix B to the accompanying Circular (the “Plan of Arrangement”), the Interim Order and the provisions of Chapter XIV the QBCA (as modified or supplemented by the Interim Order, the Plan of Arrangement and any other order of the Superior Court of Québec (the “Court”)), registered Shareholders (other than holders of Shares who have failed to exercise all the voting rights carried by the Shares held by such holders against the Arrangement Resolution) may exercise dissent rights with respect to all of their Shares (the “Dissent Rights”) in connection with the Arrangement and, if the Arrangement becomes effective, to be paid the fair value of their Shares by the Purchaser (less any applicable withholdings). Dissent Rights are more particularly described in the accompanying Circular. A registered Shareholder

 

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who wishes to exercise Dissent Rights must send to the Corporation a written notice informing the Corporation of such Shareholder’s intention to exercise Dissent Rights (the “Dissent Notice”), which Dissent Notice must be received by the Corporation at its head office located at 2015 Peel Street, 11th Floor, Montreal, Québec, Canada H3A 1T8, Attention: Mtre. Jocelyn Lafond, General Counsel and Corporate Secretary, with a copy to Fasken Martineau DuMoulin LLP at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada H3C 0B4, Attention: Mtres. Brandon Farber and Hugo Séguin, not later than 5:00 p.m. (Eastern time) on September 10, 2025 or not later than 5:00 p.m. (Eastern time) on the business day that is two business days (excluding Saturdays, Sundays and holidays) immediately preceding the date that any adjourned or postponed Meeting is reconvened or held, as the case may be. Failure to strictly comply with the requirements set forth in Chapter XIV of the QBCA (as modified or supplemented by the Interim Order, the Plan of Arrangement and any other order of the Court) may result in the loss of Dissent Rights. Anyone who is a beneficial owner of Shares registered in the name of an Intermediary and who wishes to exercise Dissent Rights should be aware that only registered Shareholders are entitled to exercise Dissent Rights. Accordingly, a non-registered Shareholder who desires to exercise Dissent Rights must make arrangements for the Shares beneficially owned by such holder to be registered in the name of such holder prior to the time the Dissent Notice is required to be received by the Corporation or, alternatively, make arrangements for the registered Shareholder of such Shares to exercise Dissent Rights on behalf of such Shareholder. A Shareholder wishing to exercise Dissent Rights may only exercise such rights with respect to all Shares registered in the name of such Shareholder if such Shareholder exercised all the voting rights carried by those Shares against the Arrangement Resolution. It is recommended that you seek independent legal advice if you wish to exercise Dissent Rights.

If you have any questions or require assistance with voting or in completing your form of proxy or voting instruction form, please contact Laurel Hill Advisory Group, the Corporation’s shareholder communications advisor and proxy solicitation agent, by telephone at 1-877-452-7184 (toll-free in North America) or at 1-416-304-0211 (outside of North America), or by email at assistance@laurelhill.com.

Questions on how to complete your Letter of Transmittal should be directed to Computershare Investor Services Inc. by telephone toll-free in North America at 1-800-564-6253 or outside of North America at 1-514-982-7555 or by email to corporateactions@computershare.com.

Dated at Montreal, Québec, Canada, August 12, 2025.

By order of the Board of Directors,

(signed) Jocelyn Lafond

Jocelyn Lafond 

General Counsel and Corporate Secretary

Theratechnologies Inc.

 

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MANAGEMENT PROXY CIRCULAR

 

 

TABLE OF CONTENTS

 

ITEM I.    MANAGEMENT PROXY CIRCULAR			1
ITEM II.   CAUTIONARY STATEMENTS			2
ITEM III.    FORWARD-LOOKING STATEMENTS			3
ITEM IV.    NOTICE TO SHAREHOLDERS NOT RESIDENT IN CANADA			4
ITEM V.   QUESTIONS AND ANSWERS ABOUT THE MEETING AND THE ARRANGEMENT			5
ITEM VI.    SUMMARY			13
1.   The Meeting			13
2.   Record Date			13
3.   Purpose of the Arrangement			13
4.   Parties to the Arrangement			13
5.   Background to the Arrangement			14
6.   Reasons for the Arrangement			14
7.   Recommendation of the Special Committee and the Board			17
8.   Fairness Opinions			18
9.   Procedural Steps			18
10.  Arrangement Steps			19
11.  Required Shareholder Approval			22
12.  Support and Voting Agreements			22
13.  Interest of Certain Persons in the Arrangement			22
14.  Arrangement Agreement			22
15.  Effective Time and Outside Date			22
16.  Court Approval			22
17.  Dissent Rights			23
18.  Risk Factors			23
19.  Delivery of Consideration			23
20.  Certain Canadian Federal Income Tax Considerations			24
21.  Certain United States Federal Income Tax Considerations			24
ITEM VII.  INFORMATION CONCERNING THE MEETING			25
1.   Purpose of the Meeting			25
2.   Date, Time, Place of the Meeting, Record Date and Quorum			25
3.   Availability of Proxy Materials			25
4.   How to Vote at the Meeting			25
5.   Appointment and Revocation of Proxies			29
6.   Exercise of Vote by Proxy			30
7.   Solicitation of Proxies			30
8.   Voting Shares and Principal Holders Thereof			30
9.   Other Matters			31
ITEM VIII.  THE ARRANGEMENT			32
1.   Purpose of the Arrangement			32
2.   Background to the Arrangement			32
3.   Reasons for the Arrangement			36
4.   Recommendation of the Special Committee and the Board			40
5.   Fairness Opinions			40
6.   Procedural Steps			53
7.   Arrangement Steps			53
8.   Certain Effects of the Arrangement			56
9.   Required Shareholder Approval			56
10.  Support and Voting Agreements			57
11.  Sources of Funds			58
12.  Guarantee of Future Pak			58
13.  Expenses of the Arrangement			58
14.  Interest of Certain Persons in the Arrangement			58

 

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15.  Continuing Insurance and Coverage for Directors and Officers of the Corporation			62
16.  Arrangements between the Corporation and Security Holders			62
17.  Intentions of Directors and Senior Officers			62
ITEM IX.  INFORMATION CONCERNING THE CORPORATION			63
1.   General			63
2.   Directors and Senior Officers			63
3.   Description of Share Capital			64
4.   Ownership of Securities			64
5.   Commitments to Acquire Securities of the Corporation			65
6.   Previous Purchases and Sales			65
7.   Previous Distributions			65
8.   Trading in Shares			66
9.   Dividend Policy			66
10.  Interest of Informed Persons in Material Transactions			67
11.  Material Changes in the Affairs of the Corporation			67
12.  Additional Information			67
ITEM X. INFORMATION CONCERNING THE PURCHASER AND FUTURE PAK			68
ITEM XI. THE ARRANGEMENT AGREEMENT			69
1.   Conditions Precedent to the Arrangement			69
2.   Representations and Warranties			71
3.   Corporation Covenants			71
4.   Purchaser Covenants			75
5.   Regulatory Approvals			76
6.   Financing Arrangements			76
7.   Pre-Acquisition Reorganization			76
8.   Non-Solicitation Obligations			77
9.   Right to Match			78
10.  Termination			80
11.  Termination Fee and Reverse Termination Fee			81
12.  CVR Agreement			82
ITEM XII. CERTAIN LEGAL AND REGULATORY MATTERS			84
1.   Steps to Implementing the Arrangement and Timing			84
2.   Court Approval and Completion of the Arrangement			84
3.   Securities Law Matters			85
ITEM XIII.  DISSENTING SHAREHOLDERS RIGHTS			88
ITEM XIV.  RISK FACTORS			91
1.   Risks Relating to the Arrangement			91
2.   Risks Relating to the CVRs			93
3.   Risks Relating to the Business of the Corporation			94
ITEM XV.  ARRANGEMENT MECHANICS			95
1.   Depositary Agreement and Paying Agency Agreement			95
2.   Delivery of Consideration			95
3.   Letters of Transmittal			97
ITEM XVI.  CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS			99
1.   Holders Resident in Canada			100
2.   Holders Not Resident in Canada			102
ITEM XVII.  CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS			104
1.   Disposition of Shares under the Arrangement			105
2.   Passive Foreign Investment Company			106
3.   United States Backup Withholding and Information Reporting			107
4.   Consequences to Dissenting U.S. Shareholders			108

 

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ITEM XVIII. QUESTIONS AND FURTHER ASSISTANCE			109
ITEM XIX. APPROVAL BY THE BOARD OF DIRECTORS			110
ITEM XX. CONSENT OF BARCLAYS CAPITAL INC.			111
ITEM XXI. CONSENT OF RAYMOND JAMES LTD.			113
APPENDIX A GLOSSARY OF TERMS			A1
APPENDIX B PLAN OF ARRANGEMENT			B1
APPENDIX C ARRANGEMENT RESOLUTION			C1
APPENDIX D INTERIM ORDER			D1
APPENDIX E NOTICE OF PRESENTATION OF THE FINAL ORDER			E1
APPENDIX F DISSENT PROVISIONS OF THE QBCA			F1
APPENDIX G FAIRNESS OPINION OF BARCLAYS CAPITAL INC.			G1
APPENDIX H FAIRNESS OPINION OF RAYMOND JAMES LTD.			H1

 

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ITEM I.

MANAGEMENT PROXY CIRCULAR

This management proxy circular (this “Circular”) is furnished in connection with the solicitation of proxies by and on behalf of the management of Theratechnologies Inc. (the “Corporation”) for use at the special meeting of the shareholders of the Corporation (the “Meeting”) to be held on Friday, September 12, 2025 at 10:00 a.m. (Eastern Time) or any adjournment(s) or postponement(s) thereof, and for the purposes set forth in the accompanying Notice of Meeting.

All capitalized terms used in this Circular but not otherwise defined herein have the meanings set forth in the “Glossary of Terms” in Appendix A or elsewhere in the Circular.

All currency amounts referred to in this Circular, unless otherwise stated, are expressed in U.S. dollars. On August 12, 2025, the closing rate published by the Bank of Canada for the conversion of U.S. dollars into Canadian dollars was $1.00 = CAD$1.3775 and of Canadian dollars into U.S. dollars was CAD$1.00 = $0.7260.

Information contained in this Circular is given as of August 12, 2025, except where otherwise noted.

 

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ITEM II.

CAUTIONARY STATEMENTS

We have not authorized any person to give any information or to make any representation in connection with the Arrangement or any other matters to be considered at the Meeting other than those contained in this Circular. If any such information or representation is given or made to you, you should not rely on it as having been authorized or as being accurate.

This Circular does not constitute an offer to buy, or a solicitation of an offer to sell, any securities, or the solicitation of a proxy, by any person in any jurisdiction in which such an offer or solicitation is not authorized or in which the person making such an offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such an offer or solicitation. The delivery of this Circular will not, under any circumstances, create any implication or be treated as a representation that there has been no change in the information set out herein since the date of this Circular.

Shareholders should not construe the contents of this Circular as legal, tax or financial advice and are urged to consult with their own legal, tax, financial or other professional advisor.

The information pertaining to CB Biotechnology, LLC (the “Purchaser”) and Future Pak, LLC (“Future Pak”) contained under “Information Concerning the Purchaser and Future Pak” of this Circular has been provided by them for inclusion in this Circular. Although the Corporation has no knowledge that would indicate that any such information contained herein is untrue or incomplete, the Corporation does not assume any responsibility for the accuracy or completeness of such information, or for the failure by the Purchaser or Future Pak, as applicable, to disclose events or information that may affect the completeness or accuracy of such information.

Descriptions in this Circular of the terms of the Arrangement Agreement, the Plan of Arrangement, the Interim Order, the Support and Voting Agreements, the Barclays Fairness Opinion and the Raymond James Fairness Opinion are summaries of the terms of those documents. Shareholders should refer to the full text of each of the Plan of Arrangement, the Interim Order, the Barclays Fairness Opinion and the Raymond James Fairness Opinion, which are attached to this Circular as Appendix B, Appendix D, Appendix G and Appendix H respectively, and copies of the Arrangement Agreement and the Support and Voting Agreements have been filed by the Corporation under its issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search. You are urged to carefully read the full text of these documents.

THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY ANY SECURITIES REGULATORY AUTHORITY, NOR HAS ANY SECURITIES REGULATORY AUTHORITY PASSED UPON THE FAIRNESS OR MERITS OF THIS TRANSACTION OR UPON THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED IN THIS CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS AN OFFENCE.

 

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ITEM III.

FORWARD-LOOKING STATEMENTS

This Circular contains “forward-looking information” within the meaning of applicable securities legislation and the Corporation intends that such forward-looking information be subject to the safe harbours created thereby. Forward-looking information can generally be identified by the use of words such as “approximately”, “may”, “will”, “could”, “believes”, “expects”, “intends”, “should”, “would”, “plans”, “potential”, “project”, “anticipates”, “estimates”, “scheduled” or “forecasts”, or other comparable terms that state that certain events will or will not occur. More particularly and without restriction, this Circular contains forward-looking statements and information regarding risks and uncertainties related to the transactions contemplated by the Arrangement which include, but are not limited to: the reasons for, and the anticipated benefits of, the Arrangement for the Corporation and its stakeholders; the timing of various steps to be completed in connection with the Arrangement, including the anticipated dates for the holding of the Meeting; the receipt and timing of the Final Order and the Effective Date of the Arrangement; the timing and effects of the Arrangement; the solicitation of proxies by the Corporation; the consequences to Shareholders if the Arrangement is not completed; the expectation that the Corporation will cease to be a reporting issuer following the completion of the Arrangement and that the Shares will be delisted from the TSX and from the Nasdaq following completion of the Arrangement; the ability of the Parties to satisfy the other conditions to the closing of the Arrangement; the achievement of the CVR Milestones; the ability to receive payments pursuant to the terms of the CVR Agreement and the timing of such payments; and other information or statements that relate to future events or circumstances and which do not directly and exclusively relate to historical facts. These forward-looking statements express, as of the date of this Circular, the estimates, predictions, projections, expectations, or opinions of the Corporation about future events or results, as well as other assumptions, both general and specific, that the Corporation believes are appropriate in the circumstances, including but not limited to assumptions as to the ability of the Parties to receive, in a timely manner and on satisfactory terms, the Required Shareholder Approval and Court approval; the ability of the Parties to satisfy, in a timely manner, the other conditions to the Closing and the completion of the Arrangement on expected terms; the impact of the Arrangement and the dedication of substantial resources from the Corporation to pursuing the Arrangement on the Corporation’s ability to maintain its current business relationships and its current and future operations, financial condition and prospects; and other expectations and assumptions concerning the steps required to give effect to the Arrangement. Although the Corporation believes that the expectations produced by these forward-looking statements are founded on valid and reasonable bases and assumptions, these forward-looking statements are inherently subject to important risks and uncertainties, many of which are beyond the Corporation’s control, such that actual results may differ significantly from those that are disclosed in or implied by such forward-looking statements. The important risks and uncertainties that may cause the actual results and future events to differ significantly from the expectations currently expressed include, but are not limited to: the possibility that the Arrangement will not be completed on the terms and conditions, or on the timing, currently contemplated, and that it may not be completed at all, due to a failure to obtain or satisfy, in a timely manner or otherwise, the Required Shareholder Approval and Court approval and other conditions to the closing of the Arrangement or for other reasons; the Purchaser’s ability to complete the anticipated Debt Financing as contemplated by the Debt Commitment Letter; the failure by the Corporation to achieve any CVR Milestone; the uncertainty surrounding the Arrangement could adversely affect the Corporation’s retention of customers, business partners and key employees; the potential for a third party to make an Acquisition Proposal; risks related to tax matters; other risks inherent to the business carried out by the Corporation and factors beyond its control which could have a Material Adverse Effect on the Corporation or its ability to complete the Arrangement; and general economic conditions, including the potential impact of tariffs. For additional risks and uncertainties about the Corporation’s business, please see the “Financial Risk Management” and “Risk Factors” sections of the Corporation’s 2024 Annual MD&A, which is available under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca, and section “Risk Factors” under the heading “Key Information” of the Corporation’s Form 20-F, which is available under the Corporation’s issuer profile on EDGAR at https://www.sec.gov/edgar/search. Readers should carefully consider the matters set forth in the section entitled “Risk Factors”. Readers are cautioned that the foregoing list of factors is not exhaustive and undue reliance should not be placed on forward-looking statements. As a result, readers are advised that actual results may differ materially from expected results. Unless otherwise required by applicable securities laws, the Corporation expressly disclaims any intention, and assumes no obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

 

 

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ITEM IV.

NOTICE TO SHAREHOLDERS NOT RESIDENT IN CANADA

The Corporation is a corporation existing and organized under the laws of Québec, Canada, and is a “foreign private issuer” within the meaning of the rules promulgated under the U.S. Exchange Act. Section 14(a) of the U.S. Exchange Act and related proxy rules are not applicable to the Corporation nor to this solicitation and, therefore, this solicitation is not being effected in accordance with such laws. The solicitation of proxies and the transactions contemplated herein involve securities of a Canadian issuer and are being effected in accordance with Canadian corporate laws and Canadian Securities Laws, which differ from disclosure requirements in the United States.

The unaudited interim financial statements and annual audited historical financial statements of the Corporation and other financial information included or incorporated by reference in this Circular have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board, and thus may differ from the U.S. generally accepted accounting principles. Shareholders that are United States taxpayers are advised to consult their independent tax advisors regarding the United States federal, state, local and foreign tax consequences to them by participating in the Arrangement.

The enforcement by investors of civil liabilities under United States federal and state securities laws may be affected adversely by the fact that the Corporation is organized under the laws of a jurisdiction other than the United States, that some (or all) of its respective officers and directors are residents of countries other than the United States, that some or all of the experts named in this Circular may be residents of countries other than the United States, or that all or a substantial portion of the assets of the Corporation and such directors, officers and experts may be located outside the United States. As a result, it may be difficult or impossible for Shareholders resident in the United States to effect service of process within the United States upon the Corporation and its respective officers and directors or the experts named herein, or to realize against them on judgments of courts of the United States. In addition, Shareholders resident in the United States should not assume that the courts of Canada: (a) would enforce judgments of United States courts obtained in actions against such persons predicated upon civil liabilities under United States federal or state securities laws; or (b) would enforce, in original actions, liabilities against such persons predicated upon civil liabilities under United States federal or state securities laws.

Shareholders who are foreign taxpayers should be aware that the Arrangement described in this Circular may have tax consequences both in Canada and in foreign jurisdictions that are not described in this Circular. Shareholders are advised to consult their tax advisors to determine the tax consequences to them of the transactions contemplated in this Circular having regard to their particular circumstances.

 

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ITEM V.

QUESTIONS AND ANSWERS ABOUT THE MEETING AND THE ARRANGEMENT

The following are some questions that you, as a Shareholder, may have relating to the Meeting and answers to those questions. These questions and answers do not provide all of the information relating to the Meeting or the matters to be considered at the Meeting and are qualified in their entirety by the more detailed information contained elsewhere in this Circular, the attached Appendices, the form of proxy and the Letter of Transmittal, all of which are important and should be reviewed carefully. You are urged to read this Circular in its entirety before making a decision related to your Shares. See the “Glossary of Terms” in Appendix A of this Circular for the meanings assigned to capitalized terms used below and elsewhere in this Circular that are not otherwise defined in these questions and answers.

 

Q:	Why did I receive this document?

 

A:

This document is a management proxy circular that has been mailed in advance of the Meeting. This Circular describes, among other things, the background to the Arrangement as well as the reasons for the determinations and recommendations of the Special Committee and the Board. This Circular contains a detailed description of the Arrangement, including certain risk factors relating to the completion of the Arrangement. If you are a Shareholder, a form of proxy or voting instruction form, as applicable, accompanies this Circular.

On July 2, 2025, the Corporation, the Purchaser and Future Pak entered into the Arrangement Agreement pursuant to which they agreed, subject to certain terms and conditions, to complete the Arrangement. See “The Arrangement Agreement” for a summary of the Arrangement Agreement’s terms and conditions. The full text of the Arrangement Agreement is available under the Corporation’s profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search. The Arrangement is subject to, among other things, obtaining the approval of the Shareholders.

If you are a holder of Exchangeable Subscription Receipts, Warrants, Options, SARs and/or DSUs, but are not a Shareholder on the Record Date, you received this Circular to provide you with notice and information with respect to the treatment of Exchangeable Subscription Receipts, Warrants, Options, SARs and/or DSUs under the Arrangement. See “The Arrangement – Arrangement Steps”.

 

Q:	Who is soliciting my proxy?

 

A:

This Circular is furnished in connection with the solicitation of proxies by and on behalf of the management of the Corporation for use at the Meeting or any adjournment(s) or postponement(s) thereof. It is expected that solicitations of proxies will be made primarily by mail and supplemented by telephone or other personal contact by directors, senior officers and employees of the Corporation without special compensation. The Corporation has retained Laurel Hill Advisory Group as shareholder communications advisor and proxy solicitation agent to, among other things, assist in the solicitation of proxies and may also retain other persons as the Corporation deems necessary to aid in the solicitation of proxies with respect to the Meeting. See “Information concerning the Meeting – Solicitation of Proxies”.

 

Q:	Does the Board support the Arrangement?

 

A:

Yes. After careful consideration, and after consulting with outside legal and financial advisors and having taken into account such factors and matters as it considered relevant, including, among other things, the unanimous recommendation of the Special Committee, the Board has unanimously determined that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders. Accordingly, the Board has unanimously approved the Arrangement and recommends that Shareholders vote FOR the Arrangement Resolution. A full description of the information and factors considered by the Board and the Special Committee is set forth under the heading “The Arrangement – Reasons for the Arrangement” in this Circular.

 

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Q:	What will I receive for my Shares under the Arrangement?

 

A:	If the Arrangement is completed, each Share will be transferred to the Purchaser in exchange for $3.01 in cash and one (1) CVR per Share to be issued by the Purchaser, subject to any applicable withholdings pursuant to the terms and conditions of the Arrangement Agreement.

The cash portion of the consideration offered to the Shareholders and the combined cash and CVR consideration (assuming maximum payment of the CVR) represent premiums of 126% and 216%, respectively, to the closing price on the Nasdaq on April 10, 2025, the date prior to the announcement of Future Pak’s initial non-binding proposal, and of 90% and 165%, respectively, to the 30-day volume weighted average share price for the period ending on April 10, 2025.

 

Q:	What is a CVR?

 

A:

Each CVR is a contractual right and a form of contingent consideration that will entitle the holder thereof to aggregate payments from the Purchaser of up to $1.19 per CVR, subject to the CVR Agreement and if the CVR Milestones set out in the CVR Agreement are achieved by the Corporation. The CVR Agreement contains a maximum aggregate payment of $65 million to CVR Holders. For additional information on the CVRs, please see “The Arrangement Agreement – CVR Agreement” and “Risk Factors – Risks Relating to the Arrangement.”

 

Q:	What will I receive for my Options, SARs, Warrants, DSUs or Exchangeable Subscription Receipts under the Arrangement?

 

A:

In accordance with and subject to the Plan of Arrangement and notwithstanding anything contrary in the Incentive Plans or any applicable grant letter, employment agreement or any resolution or determination of the Board (or any committee thereof), the Options, SARs, Warrants, DSUs or Exchangeable Subscription Receipts identified below shall be treated as follows:

 

(a)

each Option outstanding immediately prior to the Effective Time with an Exercise Price per Share that is less than the Cash Consideration that has not yet vested in accordance with its terms shall be accelerated so that such Option becomes exercisable, notwithstanding the terms of the Share Option Plan or any award or similar agreement pursuant to which such Option was granted or awarded, immediately following which each such Option that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the Cash Consideration less the applicable Exercise Price in respect of such Option, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such Option shall immediately be cancelled and all of the Corporation’s obligations with respect to such Option shall be deemed to be fully satisfied;

 

(b)

each Underwater Option that has not yet vested in accordance with its terms shall be accelerated so that such Option becomes exercisable, notwithstanding the terms of the Share Option Plan or any award or similar agreement pursuant to which such Option was granted or awarded, immediately following which each such Option that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such Option shall immediately be cancelled and all of the Corporation’s obligations with respect to such Option shall be deemed to be fully satisfied; provided that each CVR issued to a holder in respect of an Underwater Option shall only entitle such holder to a maximum amount in cash equal to the amount by which the Cash Consideration plus the Maximum Milestone Payments Amount exceeds the Exercise Price per Share of such Underwater Option, if payable and as otherwise determined in accordance with the CVR Agreement. For greater certainty, where the Exercise Price of any Option is greater than or equal to the Cash Consideration plus the Maximum Milestone Payments Amount, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such Option the Consideration or any other amount in respect of such Option, and the Option shall be immediately cancelled;

 

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(c)

each SAR outstanding immediately prior to the Effective Time with an Exercise Price per Share that is less than the Cash Consideration that has not yet vested in accordance with its terms shall be accelerated so that such SAR becomes exercisable, notwithstanding the terms of the SAR Plan or any award or similar agreement pursuant to which any SARs were granted or awarded, immediately following which each such SAR that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the Cash Consideration less the applicable Exercise Price in respect of such SAR, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement and such SAR shall immediately be cancelled and all of the Corporation’s obligations with respect to such SAR shall be deemed to be fully satisfied;

 

(d)

each Underwater SAR that has not yet vested in accordance with its terms shall be accelerated so that such SAR becomes exercisable, notwithstanding the terms of the SAR Plan or any award or similar agreement pursuant to which such SAR was granted or awarded, immediately following which each such SAR that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such SAR shall immediately be cancelled and all of the Corporation’s obligations with respect to such SAR shall be deemed to be fully satisfied; provided that each CVR issued to a holder in respect of an Underwater SAR shall only entitle such holder to a maximum amount in cash equal to the amount by which the Cash Consideration plus the Maximum Milestone Payments Amount exceeds the Exercise Price per Share of such Underwater SAR, if payable and as otherwise determined in accordance with the CVR Agreement. For greater certainty, where the Exercise Price of any SAR is greater than or equal to the Cash Consideration plus the Maximum Milestone Payments Amount, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such SAR the Consideration or any other amount in respect of such SAR, and the SAR shall be immediately cancelled;

 

(e)

each Warrant outstanding immediately prior to the moment that is immediately prior to the Effective Time that has not yet vested in accordance with its terms shall be accelerated so that such Warrant becomes exercisable, notwithstanding the terms of the Warrants or any award or similar agreement pursuant to which any Warrants were granted or awarded, immediately following which each Warrant that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the amount (if any) by which the Cash Consideration exceeds the Exercise Price of such Warrant, multiplied by the fraction of Share that such Warrant entitles the holder to purchase, being one fourth (1/4) of a Share, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR, issued by the Purchaser on behalf of the Corporation, for every four (4) Warrants, with any fractions rounded down to the nearest whole with no further compensation for any loss of such fractional part of a CVR, less any applicable withholdings pursuant to the Plan of Arrangement, and each such Warrant shall immediately be cancelled and all of the Corporation’s obligations with respect to each such Warrant shall be deemed to be fully satisfied. For greater certainty, where the foregoing amount is equal to zero or negative for any such Warrant, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such Warrant the Cash Consideration or any other amount in respect of such Warrant, and the Warrant shall be immediately cancelled;

 

(f)

each DSU outstanding immediately prior to the Effective Time (whether vested or unvested) shall, notwithstanding the terms of the DSU Plan or any award or similar agreement pursuant to which any DSUs were granted or awarded, as applicable, be deemed to have vested;

 

(g)

each whole DSU that remains outstanding shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation, free and clear of all Liens, in exchange for (i) an amount in cash from the Corporation equal to the Cash Consideration, in each case, with such amounts to be paid to the applicable holders in accordance with the Plan of Arrangement less any applicable withholdings pursuant to the Plan of Arrangement and (ii) one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and each such DSU shall immediately be cancelled and all of the Corporation’s obligations with respect to each such DSU shall be deemed to be fully satisfied;

 

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(h)

each fractional DSU that remains outstanding (if any) shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation in exchange for an amount in cash from the Corporation equal to the Cash Consideration multiplied by the applicable fraction of a DSU held by the applicable holder, in each case, with such amounts to be paid to the applicable holders in accordance with the Plan of Arrangement less any applicable withholdings pursuant to the Plan of Arrangement and each such fractional DSU shall immediately be cancelled and all of the Corporation’s obligations with respect to each such fractional DSU shall be deemed to be fully satisfied; and

 

(i)

each Exchangeable Subscription Receipt that is not exchanged into Shares immediately prior to the Effective Time and that remains outstanding shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation, free and clear of all Liens, in exchange for (i) the Exchangeable Subscription Receipt Cash Consideration with such amount to be paid to the holder in accordance with the Plan of Arrangement less any applicable withholdings and (ii) one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and each such Exchangeable Subscription Receipt shall immediately be cancelled and all of the Corporation’s obligations with respect to each such Exchangeable Subscription Receipt shall be deemed to be fully satisfied.

See “The Arrangement – Arrangement Steps”.

 

Q:	When is the Arrangement expected to be completed?

 

A:

It is currently anticipated that the Effective Date will occur by the end of the Corporation’s fourth quarter ending November 30, 2025. It is not possible, however, to state with certainty when the Effective Date will occur. The Effective Date could be delayed for a number of reasons, including an objection before the Court at the hearing of the application for the Final Order. As provided under the Arrangement Agreement, the Corporation will file the Articles of Arrangement with the Enterprise Registrar as soon as reasonably practicable and in any event no later than seven (7) Business Days after the satisfaction or waiver of the conditions to the completion of the Arrangement to give effect to the Arrangement.

The Arrangement must be completed on or prior to December 2, 2025, which is the Outside Date, unless the parties to the Arrangement Agreement agree to extend the Outside Date.

 

Q:	Who can vote at the Meeting?

 

A:	As a Shareholder on the Record Date, you are entitled to receive notice of, and to vote at, the Meeting. The Corporation is soliciting your proxy, or vote, and providing this Circular in connection with such solicitation.

Only Shareholders on the Record Date are entitled to vote their Shares at the Meeting and holders of only Exchangeable Subscription Receipts, Warrants, Options, SARs and/or DSUs, as the case may be, are not entitled to vote at the Meeting.

 

Q:	Am I a registered shareholder or a non-registered shareholder and what is the difference?

 

A:	Registered Shareholders hold Shares of the Corporation registered in their names with the Corporation’s transfer agent, Computershare, and such Shares are generally evidenced by a share certificate or direct registration statement.

Non-Registered Shareholders beneficially own their Shares through an Intermediary. If your Shares appear on an account statement provided by your bank, broker or financial advisor, you are, in all likelihood, a Non-Registered Shareholder. The Corporation and its transfer agent do not have a record of the Non-Registered Shareholders and, as a result, will have no knowledge of your shareholdings and entitlement to vote. Therefore, Non-Registered Shareholders should carefully follow the instructions of their Intermediaries to ensure that their Shares are voted at the Meeting in accordance with such Non-Registered Shareholder’s instructions.

 

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Q:	When and where is the Meeting?

 

A:

The Meeting will be held in hybrid format on Friday, September 12, 2025 at 10:00 a.m. (Eastern time), in person at the offices of Fasken Martineau DuMoulin LLP located at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada and virtually via live audio webcast at https://meetnow.global/MDUWLGW.

 

Q:	How do I vote my Shares?

 

A:

As a Registered Shareholder, you may vote (i) by attending the Meeting in person or virtually, (ii) by appointing a proxyholder designated by the Corporation in the form of proxy as your proxyholder, (iii) by appointing a Third Party Proxyholder, or (iv) by Internet, smartphone, telephone or mail, as further described in this Circular under the heading “Information concerning the Meeting – How to Vote at the Meeting”.

As a Non-Registered Shareholder, you may vote (i) by attending the Meeting in person or virtually by first appointing yourself as your proxyholder, (ii) by appointing a proxyholder designated by the Corporation in the voting instruction form as your proxyholder or through your Intermediary in accordance with the instructions provided by your Intermediary, or (iii) by Internet, smartphone, telephone or mail as permitted and described in the voting instruction form provided to you, as further described in this Circular under the heading “Information concerning the Meeting – How to Vote at the Meeting”.

 

Q:	If my Shares are held by my broker, will my broker vote my Shares for me?

 

A:

If you are a Non-Registered Shareholder, you must provide your voting instructions to your Intermediary on how to vote. Without instructions, those Shares may not be voted. Most Intermediaries delegate responsibility for obtaining instructions to Broadridge. Broadridge typically mails a scannable voting instruction form in lieu of a form of proxy to Non-Registered Shareholders and provides appropriate instructions respecting voting of Shares to be represented at the Meeting. Non-Registered Shareholders should complete the voting instruction form by following the directions provided on the form. Unless your broker or other Intermediary gives you its specific proxy, voting instruction form or other method to provide voting instructions to vote the Shares at the Meeting, you should complete the voting instruction form provided. See “Information concerning the Meeting – How to Vote at the Meeting”.

 

Q:	Can I revoke my proxy after I submit it?

 

A:

Yes. A Registered Shareholder who has submitted a proxy may revoke such proxy by: (a) completing and signing a proxy bearing a later date and depositing it with Computershare in accordance with the instructions set out above, or (b) depositing an instrument in writing executed by the Registered Shareholder or by such Shareholder’s personal representative authorized in writing (i) at the office of Computershare no later than 10:00 a.m. (Eastern time) on September 10, 2025 (or not later than 48 hours, excluding Saturdays, Sundays and statutory holidays, before any reconvened meeting if the Meeting is adjourned or postponed), (ii) with the Chair of the Meeting, prior to the commencement of the Meeting on the day of the Meeting, or where the Meeting has been adjourned or postponed, prior to the commencement of the reconvened or postponed Meeting on the day of such reconvened or postponed Meeting, or (iii) in any other manner permitted by law. In addition, if you are a Registered Shareholder, once you arrive at the Meeting and you register with the Corporation’s transfer agent, you may (but are not obliged to) revoke any and all previously submitted proxies by voting on the matters put forth at the Meeting. If you attend the Meeting but do not vote by poll, your previously submitted proxy will remain valid. See “Information concerning the Meeting – Appointment and Revocation of Proxies”.

If you are a Non-Registered Shareholder and you want to revoke your voting instruction form, contact your Intermediary to find out what to do. Please note that your Intermediary will need to receive any new instructions sufficiently in advance of the Meeting in order to act on them.

 

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Q:	Should I send in my proxy or voting instructions now?

 

A:

Whether or not you expect to attend the Meeting, we encourage you to take the time to complete, sign, date and return the enclosed form of proxy or voting instruction form, as applicable, in accordance with the instructions set out therein so that your Shares can be voted at the Meeting, in accordance with one of the voting methods set forth in the table below.

 

Voting Method		Registered Shareholders		Non-Registered Shareholders
		If your Shares are held in your name and represented by a share certificate or DRS Advice		If your Shares are held with an Intermediary or a depository (such as CDS Clearing and Depository Services Inc. or Depository Trust Company)
Via the internet		Go to www.investorvote.com. Enter the 15- digit control number printed on your form of proxy and follow the instructions on screen.		Go to www.proxyvote.com. Enter the 16-digit control number printed on your voting instruction form and follow the instructions on the screen.
By email		You will need to scan your completed and signed proxy form and email it to service@computershare.com.		Follow the instructions provided by your Intermediary.
By Smartphone		Scan the QR code on your form of proxy and follow the instructions.		Follow the instructions provided by your Intermediary.
By telephone		Vote by telephone at 1-866-732-8683 within North America (toll-free) or 312-588-4290 outside North America using the 15-digit control number printed on your form of proxy.		Vote by telephone (toll-free) at 1-800-474- 7493 (English) or 1-800-474-7501 (French) using the 16-digit control number provided on the voting instruction form.
By mail		Computershare Investor Services Inc., 320 Bay Street, 14th Floor, Toronto, Ontario M5H 4A6, Attention: Proxy Department		Complete, date and sign the voting instruction form and return it in the enclosed postage paid envelope.
By fax		Complete the proxy form or voting instruction form, as applicable, and return it by fax at 416 263-9524 or 1 866 249-7775.		Follow the instructions provided by your Intermediary.

The Corporation may utilize Broadridge’s QuickVote^™ service to assist eligible Non-Registered Shareholders with voting their Shares over the telephone. In accordance with applicable Securities Laws, certain Non-Registered Shareholders who are NOBOs may be contacted by Laurel Hill Advisory Group, which is soliciting proxies on behalf of the management of the Corporation, to conveniently obtain a vote directly over the telephone.

 

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Q:	Can I ask questions at the Meeting?

 

A:

Registered Shareholders and duly registered Third Party Proxyholders who log into the Meeting will be entitled to ask questions in writing during the Meeting by using the “Q&A” tab of the platform that will be available for that purpose. Persons logging into the virtual Meeting as “guest” will not be able to ask questions during the Meeting. Questions will be reviewed by the Corporation during the Meeting, but not all questions will be answered by directors or members of management attending the Meeting. Questions for which answers will be provided during the Meeting will be read and answered verbally by directors and/or members of management attending the Meeting. The Corporation does not undertake to answer all of the questions asked nor to communicate with each individual who asked questions during the Meeting to provide them with the answers thereof.

 

Q:	What are the Canadian income tax consequences of the Arrangement to Shareholders?

 

A:

The Arrangement will generally be a taxable transaction for Shareholders resident in Canada and, as a result, such Shareholders will generally be required to pay tax on the gain (if any) recognized from the disposition of Shares pursuant to the Arrangement. This summary is qualified in its entirety by the discussion under “Certain Canadian Federal Income Tax Considerations”. The discussion under those headings are not intended to be legal or tax advice to any particular Shareholder. Tax matters are complicated, and the income tax consequences of the Arrangement to you will depend on your particular circumstances.

Shareholders should carefully read the information in this Circular under “Certain Canadian Federal Income Tax Considerations” which qualifies the information set out below and should consult their own tax advisors. Shareholders are urged to consult their own tax advisors to determine the particular tax consequences to them of the Arrangement.

Shareholders who are residents of Canada for purposes of the Tax Act will realize a disposition of their Shares under the Arrangement for income tax purposes. The Canadian income tax consequences in respect of the receipt, holding and disposition of the CVRs, including the tax consequences of the receipt of payments pursuant to the CVRs, are not entirely free from doubt. Shareholders should carefully read the information in this Circular under the heading “Certain Canadian Federal Income Tax Considerations - Holders Resident in Canada” and are urged to consult their own tax advisors having regard to their own particular circumstances.

Shareholders who are not residents of Canada for purposes of the Tax Act and that do not hold their Shares as “taxable Canadian property” (as defined in the Tax Act) will generally not be subject to tax under the Tax Act on the disposition of their Shares under the Arrangement. See “Certain Canadian Federal Income Tax Considerations - Holders Not Resident in Canada”.

The discussion under the heading “Certain Canadian Federal Income Tax Considerations” is not intended to be legal or tax advice to any particular Shareholder. Tax matters are complicated, and the income tax consequences of the Arrangement to you will depend on your particular circumstances. Because individual circumstances may differ, you should consult with your tax advisors as to the specific tax consequences of the Arrangement to you.

 

Q:	What are the United States federal income tax consequences of the Arrangement for U.S. Shareholders?

 

A:

Subject to the discussion in the section under the heading “Certain United States Federal Income Tax Considerations”, including the discussion concerning whether the Corporation is or has been a PFIC (as defined in such section), a U.S. Shareholder who holds Shares as capital assets and who sells such Shares pursuant to the Arrangement and receives the Consideration generally will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference between the amount received and the U.S. Shareholder’s adjusted tax basis in the Shares. The foregoing description of the U.S. federal income tax consequences of the Arrangement is qualified in its entirety by the more detailed discussion under “Certain United States Federal Income Tax Considerations” below, and neither this description nor the more detailed discussion is intended to be legal or tax advice to any particular Shareholder. Accordingly, U.S. Shareholders should consult their tax advisors with respect to their particular circumstances.

 

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Q:	What will I have to do as a Shareholder to obtain the Consideration?

 

A:

Registered Shareholders will have received with this Circular a Letter of Transmittal. In order to receive the Consideration, Registered Shareholders must properly complete and duly execute the Letter of Transmittal and deliver such Letter of Transmittal, together with all other documents and instruments referred to in the Letter of Transmittal or reasonably requested by the Depositary, including the certificate(s) and/or DRS Advice(s) representing the Shares, to the Depositary in accordance with the instructions contained in the Letter of Transmittal. The Letter of Transmittal contains procedural information relating to the Arrangement and should be reviewed carefully. The Cash Consideration payable will be denominated in U.S. dollars, provided that a Registered Shareholder is to be paid a converted amount in Canadian dollars if either (i) it elected to receive the payment in Canadian dollars prior to the Effective Date in its Letter of Transmittal or (ii) its address of record is within Canada and it has not elected to receive the payment in any currency prior to the Effective Date in its Letter of Transmittal. Additional copies of the Letter of Transmittal can be obtained by contacting the Depositary. The Letter of Transmittal for use by Registered Shareholders can also be found under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search.

Non-Registered Shareholders holding their Shares through an Intermediary should contact that Intermediary for instructions and assistance and carefully follow any instructions provided to them by such Intermediary for the Consideration.

See “Arrangement Mechanics – Delivery of Consideration” and “Letters of Transmittal”.

Questions on how to complete the Letter of Transmittal should be directed to the Depositary, Computershare, at 1- 800-564-6253 (toll-free in Canada and the United States) or 1-514-982-7555 (from outside of Canada and the United States), or by email at corporateactions@computershare.com.

 

Q:	Are Shareholders entitled to Dissent Rights?

 

A:

Only Registered Shareholders on the Record Date are entitled to Dissent Rights. Shareholders should carefully read the section entitled “Dissenting Shareholders Rights” if they wish to exercise Dissent Rights and should seek their own legal advice. A failure to strictly comply with the requirements set forth in Chapter XIV of the QBCA (as modified or supplemented by the Interim Order, the Plan of Arrangement and any other order of the Court) may result in the loss of Dissent Rights. See Appendix D and Appendix F to this Circular for a copy of the Interim Order and certain information relating to the Dissent Rights.

None of the following shall be entitled to exercise Dissent Rights: (i) holders of only Exchangeable Subscription Receipts, Warrants, Options, SARs, and/or DSUs, and (ii) Shareholders who vote or have instructed a proxyholder to vote Shares in favour of the Arrangement Resolution or who abstained from voting on the Arrangement Resolution.

 

Q:	Who can help answer my questions?

 

A:

Shareholders who have any questions should consult their financial, legal, tax or other professional advisor. If you have any questions about the information contained in this Circular or require assistance with voting or in completing your form of proxy or voting instruction form, please contact Laurel Hill Advisory Group, our shareholder communications advisor and proxy solicitation agent, by telephone at 1-877-452-7184 (toll-free in North America) or at 1-416-304-0211 (outside of North America), or by email at assistance@laurelhill.com. Questions on how to complete your Letter of Transmittal should be directed to Computershare Investor Services Inc. by telephone toll-free in North America at 1-800-564-6253 or outside of North America at 1-514-982-7555 or by email to corporateactions@computershare.com.

 

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ITEM VI.

SUMMARY

The following is a summary of certain information contained in this Circular. This summary is not intended to be complete and is qualified in its entirety by the more detailed information contained elsewhere in this Circular and the attached Appendices, all of which are important and should be reviewed carefully. See the “Glossary of Terms” in Appendix A of this Circular for the meanings assigned to capitalized terms used below and elsewhere in this Circular that are not otherwise defined in this summary.

 

1.	The Meeting

The Meeting will be held in hybrid format on Friday, September 12, 2025 at 10:00 a.m. (Eastern time), in person at the offices of Fasken Martineau DuMoulin LLP located at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada and virtually via live audio webcast at https://meetnow.global/MDUWLGW. The Meeting is a special meeting of Shareholders at which Shareholders will be asked to consider and, if deemed advisable, to pass, with or without variation, the Arrangement Resolution, the full text of which is set forth at Appendix C. Shareholders may also be asked to consider other business that properly comes before the Meeting or any adjournment(s) or postponement(s) thereof. See “Information concerning the Meeting”.

 

2.	Record Date

The Board has fixed August 13, 2025 as the Record Date, being the date for the determination of the Shareholders entitled to receive notice of, and to vote at, the Meeting or any adjournment(s) or postponement(s) thereof. Only Shareholders whose names have been entered in the register of the Corporation as at the close of business on the Record Date are entitled to receive notice of, and to vote at, the Meeting or any adjournment(s) or postponement(s) thereof. See “Information concerning the Meeting – Voting Shares and Principal Holders Thereof”.

 

3.	Purpose of the Arrangement

The purpose of the Arrangement is to effect the acquisition of the Corporation by the Purchaser by way of a statutory plan of arrangement under Chapter XVI – Division II of the QBCA. Pursuant to the Arrangement Agreement, the Purchaser has agreed to acquire all of the issued and outstanding Shares for $3.01 in cash per Share and one (1) CVR to be issued by the Purchaser, subject to any applicable withholdings, as further described in the CVR Agreement. Upon completion of the Arrangement, among other things, the Purchaser will acquire all of the issued and outstanding Shares and the Corporation will become a privately-held wholly-owned subsidiary of the Purchaser. See “The Arrangement” and “The Arrangement Agreement”.

 

4.	Parties to the Arrangement

The Corporation

The Corporation (TSX: TH / Nasdaq: THTX) is a specialty biopharmaceutical company focused on the commercialization of innovative therapies that have the potential to redefine standards of care. The Corporation’s business strategy is to grow revenues and to achieve a positive adjusted EBITDA from the sale of its existing and potential future assets in North America and to develop a portfolio of complementary products, compatible with its commercialization know-how. The Corporation currently commercializes two approved products for people living with HIV, namely: EGRIFTA SV^® and Trogarzo^® in the United States. The Corporation’s head office is located in Montreal, Québec.

The Purchaser and Future Pak

Future Pak is a privately held contract manufacturer, packager and distributor of pharmaceutical and nutraceutical products. Founded in 1977 and headquartered in Wixom, Michigan, Future Pak, along with its affiliates, operates across retail, specialty and institutional markets, leveraging its robust infrastructure and partner network to deliver quality-first, patient-centric solutions.

The Purchaser is a Delaware limited liability company that was formed on June 4, 2025 solely for the purpose of engaging in the transactions contemplated by the Arrangement Agreement. The Purchaser is not engaged in any business activities other than in connection with the transactions contemplated by the Arrangement Agreement and the Debt Financing.

 

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5.	Background to the Arrangement

The Arrangement Agreement and the other definitive transaction documents were finalized and executed by the parties thereto following the close of markets on July 2, 2025, and the Corporation issued a press release publicly announcing the Arrangement that same evening. A summary of the main events that led to the execution of the Arrangement Agreement and certain meetings, negotiations, discussions and actions of the Parties that preceded the public announcement of the Arrangement on July 2, 2025 is provided in “The Arrangement – Background to the Arrangement”.

 

6.	Reasons for the Arrangement

In evaluating and approving the Arrangement and in making their determinations and recommendations, each of the Special Committee and the Board considered a number of factors including, among others, the following:

 

•

Thorough Targeted Market Checks. In 2023, amidst efforts by the Corporation (including with the support of Barclays Capital Inc. (“Barclays”)) to find commercial partners to achieve its strategic plan and to secure potential new financing sources, a number of third parties expressed an interest in acquiring the Corporation. As a result, after discussions with its financial and legal advisors, the Board decided to proceed with the First Targeted Market Check, which ran from February 2024 to July 2024 and was ultimately terminated due to unsatisfactory prices being offered. In the second half of 2024, the receipt of certain written and/or verbal indications of interest from third parties led to the formation of the Special Committee and the Market Check Refresh, again with the assistance of Barclays, which did not result in any offers. Following a months-long process with Bidder B that led to an uncompelling final offer, the Corporation ultimately decided to further evaluate the sale of the Corporation by way of an open and non-exclusive Sale Process and to conduct the Second Targeted Market Check, during which 20 potential bidders were contacted and four (4) unsolicited inbound reach outs were received. In connection therewith, the Corporation received two final offers, from each of Future Pak and Bidder C. Therefore, prior to signing the Arrangement Agreement, multiple targeted market checks were conducted involving solicitation of interest from potential bidders identified as potentially having a desire to pursue a transaction involving the Corporation;

 

•

Consideration is a Substantial and Compelling Premium. The cash portion of the consideration offered to the Shareholders and the combined cash and CVR consideration (assuming maximum payment of the CVR) represent premiums of 126% and 216%, respectively, to the closing price on the Nasdaq on April 10, 2025, the date prior to the announcement of Future Pak’s initial non-binding proposal, and of 90% and 165%, respectively, to the 30-day volume weighted average share price for the period ending on April 10, 2025;

 

•

Attractive Transaction Relative to Status Quo. The Special Committee, with the assistance of its financial and legal advisors, and based upon its collective knowledge of the business, affairs, operations, assets, liabilities, financial condition, results of operations and prospects of the Corporation and the current and prospective environment in which the Corporation operates, believes that the Arrangement is an attractive proposition for Shareholders relative to the status quo and is more favourable to the Shareholders than the other strategic alternatives reasonably available to the Corporation, including remaining as an independent public corporation. In particular, the Special Committee’s assessment of the Corporation’s strategic plan, the challenges it would face under the status quo, the substantial capital and resources required to implement the plan, the limited availability and high cost of such capital if the Corporation remained publicly listed, the broad declines in North American equity markets and resulting pressure on the Corporation’s share price, and the difficult macroeconomic environment, led the Special Committee to believe that the Arrangement is in the Corporation’s best interest compared to maintaining the status quo;

 

•

Limited Capacity to Finance Growth via Public Markets. Capital market financings by Nasdaq-listed biopharmaceutical micro-cap companies continue to be challenging with the low trading volume of the Shares being a deterrent to potential new institutional investors and the historically undervalued trading price of the Shares further exacerbates the challenges faced;

 

•

Cash Consideration; Immediate Liquidity. The Cash Consideration to be received by the Shareholders under the terms of the Arrangement Agreement will be paid entirely in cash and provides Shareholders with certainty, immediate value and liquidity for their investment and removes the volatility associated with owning securities of the Corporation as an independent, publicly-traded company, as well as the risks and uncertainties and longer potential timeline for realizing equivalent value from the Corporation’s strategic plan or other possible strategic alternatives;

 

•

Opportunity to Receive Additional Cash Payments under the CVRs. The Consideration includes a CVR tied to the value received through the EGRIFTA and Trogarzo franchises, with a maximum payment of $65 million, which provides Shareholders with an opportunity to receive future cash payments of up to $1.19 per Share;

 

- 14 -

•

Limited Potential Purchasers. In the view of the Special Committee, there are a limited number of potential purchasers with an interest to acquire the Corporation at a price per Share equivalent to the Cash Consideration, in light of the recent Targeted Market Checks performed prior to entering into the Arrangement Agreement and based on the Special Committee’s assessment, including advice from the Corporation’s management, Barclays and Raymond James Ltd. (“Raymond James”). Therefore, there may not be another opportunity for Shareholders to receive a value comparable to the Consideration to be received pursuant to the Arrangement Agreement in another transaction in the future;

 

•

Best Possible Terms from Purchaser. Future Pak made its first non-binding proposal regarding a potential acquisition of the Corporation in August 2024 and, since then, four (4) further offers have been made by Future Pak. Following receipt of the Second Future Pak Proposal in January 2025, which instigated discussions between parties, the discussions and arm’s length negotiations with Future Pak took place over a period of two months. The Special Committee concluded, after such extensive negotiations and on the advice of Norton Rose, Fasken, Barclays and Raymond James, that the terms and conditions in the Arrangement Agreement, including in respect of the consideration to be paid to Shareholders pursuant thereto, are the best that could be obtained from Future Pak;

 

•

Terms of the Arrangement Agreement; Appropriateness of Deal Protections. The Special Committee and the Board have determined, after consultation with their legal advisors, that the terms and conditions of the Arrangement Agreement, including the Corporation’s and the Purchaser’s representations, warranties and covenants and the conditions to completion of the Arrangement are reasonable in light of all applicable circumstances, and believes that the limited nature of the conditions to completion of the Arrangement as provided by the Arrangement Agreement, including the absence of a financing condition, mean that the Arrangement is likely to be completed in accordance with its terms and within a short time period. The Termination Fee of $6 million, the Purchaser’s right to match a Superior Proposal and other deal protection measures contained in the Arrangement Agreement are, in the view of the Special Committee and the Board, after receiving advice from their financial and legal advisors, appropriate for a transaction of this nature. In the view of the Special Committee, after receiving advice from its financial and legal advisors, the Termination Fee is reasonable in the context of similar fees that have been negotiated in other transactions of comparable size and nature and should not preclude a third party from making an acquisition proposal;

 

•

Committed Financing. The Purchaser has provided the Corporation with satisfactory evidence, including the Debt Commitment Letter, that the Purchaser has arranged for committed financing that is not subject to unusual conditions;

 

•

Reverse Termination Fee. The Corporation is entitled to receive the Reverse Termination Fee of $12 million if the Arrangement Agreement is terminated in the event of a breach by the Purchaser in certain circumstances or a failure by the Purchaser to consummate closing in certain circumstances;

 

•

Support and Voting Agreements and Significant Shareholder Support. Certain senior officers and directors of the Corporation, being Joseph Arena, Philippe Dubuc, Frank A. Holler, Jocelyn Lafond, John Leasure, Paul Lévesque, Christian Marsolais, Andrew Molson, Dawn Svoronos, Elina Tea, Dale Weil and Jordan Zwick (the “Supporting Shareholders”), who together owned or exercised control or direction over an aggregate of 524,266 Shares, representing in the aggregate approximately 1.14% of the Corporation’s outstanding Shares as at July 2, 2025, have entered into Support and Voting Agreements with the Purchaser under which they have agreed, among other things, to vote their Shares in favour of the Arrangement Resolution and against any resolution submitted by any other person that is inconsistent with the Arrangement. Further, Soleus, holding 10.4% of the outstanding Shares as at the date hereof, has on multiple occasions expressed to the Board and publicly its belief that an acquisition of the Corporation is in the best interest of the Shareholders and, on July 31, 2025, informed the Board that it is supportive of the Arrangement and intends to vote in favour of the Arrangement absent a material change in circumstances;

 

•

Limited Closing Conditions; Absence of Regulatory Approvals; Accelerated Timeline. The Purchaser’s obligation to complete the Arrangement is subject to a limited number of conditions, which the Special Committee and the Board, after consultation with their legal advisors, believes are reasonable under the circumstances and the closing of the Arrangement is not subject to any regulatory approvals. The Special Committee and the Board believe that the Arrangement is likely to be completed in accordance with its terms and within a short period of time following the receipt of required Shareholder and Court approvals; and

 

•

Treatment of Holders of Incentive Securities. The advantageous treatment of and consideration to be received by holders of Incentive Securities.

 

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In making their unanimous determinations and recommendations, each of the Special Committee and the Board also observed that a number of procedural safeguards were, and are, present to allow the Special Committee and the Board to effectively represent the interests of the Corporation, including, among others:

 

•

Arm’s Length Negotiations and Special Committee Oversight. The Arrangement Agreement is the result of an extensive and robust arm’s-length negotiation process with the oversight and participation of the Special Committee, which is comprised solely of independent directors who have no financial interest in the Arrangement that is different from that of the Shareholders, and with the advice of experienced and qualified financial and legal advisors;

 

•

Independent Fairness Opinion. Raymond James, as independent financial advisor to the Special Committee, provided an independent fairness opinion to the Board and the Special Committee to the effect that, as at July 2, 2025, based upon and subject to the limitations, qualifications, assumptions and other matters set forth therein, the Consideration to be received by Shareholders under the Arrangement is fair, from a financial point of view, to such Shareholders. In connection with such independent fairness opinion, Raymond James will receive a fixed fee that is not dependent on the completion of the Arrangement or the conclusions it reached;

 

•

Financial Advisor’s Fairness Opinion. Barclays provided the Special Committee and the Board with a fairness opinion to the effect that, as at July 2, 2025, based upon and subject to the limitations, qualifications, assumptions and other matters set forth therein, the Consideration to be received by Shareholders under the Arrangement is fair, from a financial point of view, to such Shareholders;

 

•

Fiduciary Out; Ability to Respond to Unsolicited Superior Proposals. Under the Arrangement Agreement, the Board retains the ability, notwithstanding the non-solicitation provisions of the Arrangement Agreement, to consider and respond to unsolicited Superior Proposals prior to the approval of the Arrangement Resolution by the Shareholders on the specific terms and conditions set forth in the Arrangement Agreement, including the payment of the Termination Fee if the Arrangement Agreement is terminated as a result of the Corporation entering into a definitive agreement with respect to a Superior Proposal. In the view of the Special Committee and the Board, after receiving legal and financial advice, the Termination Fee is reasonable in the circumstances and would not preclude a third party from potentially making a Superior Proposal. Further, the Support and Voting Agreements automatically terminate in the event that the Arrangement Agreement is terminated in accordance with its terms, permitting the Supporting Shareholders to support a transaction involving a Superior Proposal;

 

•

Required Shareholder Approval. The Arrangement will become effective only if it is approved by an affirmative vote of at least (i) 662⁄3% of the votes cast by Shareholders and (ii) at least a majority of the votes cast by Shareholders, excluding the votes attached to Shares beneficially owned, or over which control or direction is exercised, by Shareholders required to be excluded pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions, in each case, by Shareholders present in person or represented by proxy at the Meeting;

 

•

Required Court Approval. The Arrangement is subject to a determination of the Court that the Arrangement is fair and reasonable;

 

•

Dissent Rights. Registered Shareholders who oppose the Arrangement may, upon compliance with certain conditions, exercise Dissent Rights and, if validly exercised, receive the fair value of their Shares;

 

•

Appropriate Inducements. The Termination Fee and the Purchaser’s right to match are appropriate inducements to the Purchaser to enter into the Arrangement Agreement; and

 

•

Fairness for Stakeholders. In the Special Committee’s view, the terms of the Arrangement Agreement treat stakeholders of the Corporation fairly in light of all relevant facts and circumstances.

In making their determinations and recommendations, the Special Committee and the Board also considered a variety of uncertainties, risks and other potentially negative factors relating to the Arrangement, including those described below:

 

•

Risk of Non-Completion. There are risks to the Corporation if the Arrangement is not completed in a timely manner or at all, including the costs to the Corporation in pursuing the Arrangement (a significant portion of which will be incurred regardless of whether the Arrangement is consummated), the potential diversion of management’s attention away from conducting the Corporation’s day-to-day business in the ordinary course and the potential impact on the Corporation’s current business relationships, including with future and prospective employees, customers, suppliers and partners;

 

•

Ability to Achieve an Alternative Transaction. If the Arrangement Agreement is terminated, there is no assurance that the Corporation will be able to find an alternative transaction with a party willing to pay greater or equivalent value compared to the Consideration or that the continued operation of the Corporation under its current business model would yield equivalent or greater value compared to that available under the Arrangement;

 

- 16 -

•

Closing Conditions and Approvals. The completion of the Arrangement is subject to certain conditions that must be satisfied or waived, certain of which are outside the control of the Corporation, including the receipt of the Required Shareholder Approval. There is no certainty that the Required Shareholder Approval will be obtained or that the other closing conditions will be satisfied or waived in a timely manner or at all. In addition, the Purchaser has the right to terminate the Arrangement Agreement in certain circumstances, including generally if conditions are not met by the Outside Date;

 

•

Consummation of the Purchaser’s Financing. The conditions set forth in the Debt Commitment Letter may not be satisfied on a timely basis or at all, which risk is partially mitigated by the Reverse Termination Fee, or other events may arise which would prevent the Purchaser from consummating the Arrangement;

 

•

Restrictions on Operations. The restrictions on the conduct of the Corporation’s business imposed pursuant to the Arrangement Agreement, requiring the Corporation to conduct its business in the ordinary course, subject to certain exceptions, during the period between the execution of the Arrangement Agreement and the consummation of the Arrangement or the termination of the Arrangement Agreement, may delay or prevent the Corporation from undertaking business opportunities that may arise pending completion of the Arrangement;

 

•

No Continuing Interest of Shareholders. If the Arrangement is successfully completed, the Corporation will no longer exist as an independent public corporation, the Shares will be delisted from the TSX and the Nasdaq and the consummation of the Arrangement will eliminate the opportunity for Shareholders to participate in potential longer- term benefits of the business of the Corporation that might result from future growth and the potential achievement of the Corporation’s long-term plans to the extent that those benefits, if any, exceed the benefits reflected in the Consideration received by Shareholders pursuant to the Arrangement and with the understanding that there is no assurance that any such long-term benefits will in fact materialize;

 

•

Taxable Transaction. The Arrangement will be a taxable transaction and, as a result, Shareholders will generally be required to pay taxes on any gains that result from their receipt of the Consideration pursuant to the Arrangement;

 

•

Newly-Formed Purchaser. The Purchaser is a newly formed entity with no assets other than its rights under the Debt Commitment Letter; and

 

•

Superior Proposals. The limitations on the Corporation’s ability to solicit additional interest from third parties and the Purchaser’s right contained in the Arrangement Agreement to match a Superior Proposal, under certain conditions, may discourage other parties from making a Superior Proposal.

The foregoing summary of the information and factors considered by the Special Committee and the Board is not intended to be exhaustive but includes the material information, factors and analysis considered by the Special Committee and the Board in making their respective determinations and recommendations with respect to the Arrangement. The members of the Special Committee and the directors of the Corporation evaluated the various factors summarized above in light of their own knowledge of the Corporation and the industry in which it operates and of the Corporation’s business, financial condition and prospects, and were assisted in this regard by management and financial advisors and outside legal counsel. Neither the Special Committee nor the Board considered it practicable to, and did not, quantify or otherwise attempt to assign specific weights to the factors considered in reaching their determinations and recommendations. Neither the Special Committee nor the Board reached any specific conclusion with respect to any of the factors or reasons considered, and the above factors are not presented in any order of priority. The foregoing discussion includes forward-looking information and readers are cautioned that actual results may vary. See “Forward-Looking Statements”.

 

7.	Recommendation of the Special Committee and the Board

Having undertaken a thorough review of, and carefully considered the terms of the Arrangement and the Arrangement Agreement and a number of other factors, including, without limitation, those listed under “The Arrangement – Reasons for the Arrangement”, and after consulting with outside legal and financial advisors, the Special Committee has unanimously determined that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders. Accordingly, the Special Committee has unanimously recommended that the Board (a) approve the Arrangement; (b) resolve that the Corporation enter into the Arrangement Agreement and any ancillary agreements as may be required to implement the Arrangement; (c) recommend that Shareholders vote in favour of the Arrangement Resolution; and (d) take any and all such other actions as may be necessary to implement, or to facilitate the implementation of, the Arrangement.

 

- 17 -

After careful consideration, and after consulting with outside legal and financial advisors and having taken into account such factors and matters as it considered relevant, including, without limitation, those listed under “The Arrangement – Reasons for the Arrangement” as well as the Special Committee’s unanimous recommendation, the Board has unanimously determined that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders. Accordingly, the Board has unanimously approved the Arrangement and recommends that Shareholders vote in favour of the Arrangement Resolution. See “The Arrangement - Recommendation of the Special Committee and the Board”.

 

8.	Fairness Opinions

In connection with the Arrangement, Barclays, as exclusive financial advisor to the Corporation, provided to the Board and the Special Committee its oral Fairness Opinion which was subsequently confirmed in writing, to the effect that, as of July 2, 2025 and based upon and subject to the assumptions, limitations, qualifications and other matters respectively set forth therein, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to such Shareholders. Raymond James, as independent financial advisor to the Special Committee, provided to the Board and the Special Committee its oral Fairness Opinion which was subsequently confirmed in writing, to the effect that, as of July 2, 2025 and based upon and subject to the assumptions, limitations, qualifications and other matters respectively set forth therein, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to such Shareholders.

The full texts of the Barclays Fairness Opinion and the Raymond James Fairness Opinion, which each state, among other things, the assumptions made, information reviewed, matters considered and limitations on the scope of the review undertaken in each case, are attached as Appendix G and Appendix H, respectively, to this Circular and incorporated by reference in their entirety into this Circular. The summaries of the Fairness Opinions in this Circular are qualified in their entirety by reference to the full text of each applicable Fairness Opinion, and Shareholders are encouraged to read the Fairness Opinions carefully in their entirety. The Fairness Opinions were provided solely to the Board and the Special Committee for their exclusive use in connection with their evaluation of the Consideration to be received pursuant to the Arrangement, and do not address any other aspect of the Arrangement. The Fairness Opinions do not constitute recommendations as to how Shareholders should vote or act on any matter relating to the Arrangement, nor as advice as to the price at which the securities of the Corporation may trade at any time or any other matter, and should not be construed as such.

The Fairness Opinions were one of many factors taken into consideration by the Board and the Special Committee in making their respective unanimous determinations that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders, and in recommending that Shareholders vote in favour of the Arrangement Resolution. See “The Arrangement – Fairness Opinions”.

 

9.	Procedural Steps

The Arrangement will be implemented by way of a statutory plan of arrangement under the provisions of Chapter XVI —Division II of the QBCA pursuant to the terms of the Arrangement Agreement. The following procedural steps must be taken in order for the Arrangement to be effective:

 

(a)

the Required Shareholder Approval must be obtained in the manner set forth in the Interim Order;

 

(b)

the Court must grant the Final Order approving the Arrangement;

 

(c)

all conditions precedent to the Arrangement, as set forth in the Arrangement Agreement, must be satisfied or waived by the appropriate party or parties; and

 

(d)

the Articles of Arrangement prepared in the form prescribed by the QBCA and signed by an authorized director or officer of the Corporation, must be filed with the Enterprise Registrar and a Certificate of Arrangement issued related thereto.

The Plan of Arrangement is attached as Appendix B to this Circular and a copy of the Arrangement Agreement is available under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search. See “The Arrangement – Arrangement Steps”.

 

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10.	Arrangement Steps

Pursuant to the Arrangement, each of the following events shall occur and shall be deemed to occur sequentially as set out below without any further authorization, act or formality, in each case, unless stated otherwise, starting at the Effective Time and effective as at two (2) minute intervals (in each case, unless otherwise specified):

 

(1)

notwithstanding the terms of the Shareholder Rights Plan, the Shareholder Rights Plan shall be terminated, and all rights issued pursuant to the Shareholder Rights Plan shall be cancelled without any payment in respect thereof;

 

(2)

notwithstanding the terms of the Investor Rights Agreement, the Investor Rights Agreement shall be terminated;

 

(3)

each Option outstanding immediately prior to the Effective Time with an Exercise Price per Share that is less than the Cash Consideration that has not yet vested in accordance with its terms shall be accelerated so that such Option becomes exercisable, notwithstanding the terms of the Share Option Plan or any award or similar agreement pursuant to which such Option was granted or awarded, immediately following which each such Option that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the Cash Consideration less the applicable Exercise Price in respect of such Option, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such Option shall immediately be cancelled and all of the Corporation’s obligations with respect to such Option shall be deemed to be fully satisfied;

 

(4)

each Underwater Option that has not yet vested in accordance with its terms shall be accelerated so that such Option becomes exercisable, notwithstanding the terms of the Share Option Plan or any award or similar agreement pursuant to which such Option was granted or awarded, immediately following which each such Option that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such Option shall immediately be cancelled and all of the Corporation’s obligations with respect to such Option shall be deemed to be fully satisfied; provided that each CVR issued to a holder in respect of an Underwater Option shall only entitle such holder to a maximum amount in cash equal to the amount by which the Cash Consideration plus the Maximum Milestone Payments Amount exceeds the Exercise Price per Share of such Underwater Option, if payable and as otherwise determined in accordance with the CVR Agreement. For greater certainty, where the Exercise Price of any Option is greater than or equal to the Cash Consideration plus the Maximum Milestone Payments Amount, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such Option the Consideration or any other amount in respect of such Option, and the Option shall be immediately cancelled;

 

(5)

each SAR outstanding immediately prior to the Effective Time with an Exercise Price per Share that is less than the Cash Consideration that has not yet vested in accordance with its terms shall be accelerated so that such SAR becomes exercisable, notwithstanding the terms of the SAR Plan or any award or similar agreement pursuant to which any SARs were granted or awarded, immediately following which each such SAR that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the Cash Consideration less the applicable Exercise Price in respect of such SAR, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement and such SAR shall immediately be cancelled and all of the Corporation’s obligations with respect to such SAR shall be deemed to be fully satisfied;

 

(6)

each Underwater SAR that has not yet vested in accordance with its terms shall be accelerated so that such SAR becomes exercisable, notwithstanding the terms of the SAR Plan or any award or similar agreement pursuant to which such SAR was granted or awarded, immediately following which each such SAR that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof,

 

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shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such SAR shall immediately be cancelled and all of the Corporation’s obligations with respect to such SAR shall be deemed to be fully satisfied; provided that each CVR issued to a holder in respect of an Underwater SAR shall only entitle such holder to a maximum amount in cash equal to the amount by which the Cash Consideration plus the Maximum Milestone Payments Amount exceeds the Exercise Price per Share of such Underwater SAR, if payable and as otherwise determined in accordance with the CVR Agreement. For greater certainty, where the Exercise Price of any SAR is greater than or equal to the Cash Consideration plus the Maximum Milestone Payments Amount, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such SAR the Consideration or any other amount in respect of such SAR, and the SAR shall be immediately cancelled;

 

(7)

each Warrant outstanding immediately prior to the moment that is immediately prior to the Effective Time that has not yet vested in accordance with its terms shall be accelerated so that such Warrant becomes exercisable, notwithstanding the terms of the Warrants or any award or similar agreement pursuant to which any Warrants were granted or awarded, immediately following which each Warrant that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the amount (if any) by which the Cash Consideration exceeds the Exercise Price of such Warrant, multiplied by the fraction of Share that such Warrant entitles the holder to purchase, being one fourth (1/4) of a Share, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR, issued by the Purchaser on behalf of the Corporation, for every four (4) Warrants, with any fractions rounded down to the nearest whole with no further compensation for any loss of such fractional part of a CVR, less any applicable withholdings pursuant to the Plan of Arrangement, and each such Warrant shall immediately be cancelled and all of the Corporation’s obligations with respect to each such Warrant shall be deemed to be fully satisfied. For greater certainty, where the foregoing amount is equal to zero or negative for any such Warrant, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such Warrant the Cash Consideration or any other amount in respect of such Warrant, and the Warrant shall be immediately cancelled;

 

(8)

each director of the Corporation shall resign from, and shall be deemed to have immediately resigned from, the Board and the board of directors of any Subsidiary;

 

(9)

each DSU outstanding immediately prior to the Effective Time (whether vested or unvested) shall, notwithstanding the terms of the DSU Plan or any award or similar agreement pursuant to which any DSUs were granted or awarded, as applicable, be deemed to have vested;

 

(10)

each whole DSU that remains outstanding shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation, free and clear of all Liens, in exchange for (i) an amount in cash from the Corporation equal to the Cash Consideration, in each case, with such amounts to be paid to the applicable holders in accordance with the Plan of Arrangement less any applicable withholdings pursuant to the Plan of Arrangement and (ii) one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and each such DSU shall immediately be cancelled and all of the Corporation’s obligations with respect to each such DSU shall be deemed to be fully satisfied;

 

(11)

each fractional DSU that remains outstanding (if any) shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation in exchange for an amount in cash from the Corporation equal to the Cash Consideration multiplied by the applicable fraction of a DSU held by the applicable holder, in each case, with such amounts to be paid to the applicable holders in accordance with the Plan of Arrangement less any applicable withholdings pursuant to the Plan of Arrangement and each such fractional DSU shall immediately be cancelled and all of the Corporation’s obligations with respect to each such fractional DSU shall be deemed to be fully satisfied;

 

(12)

(i) each former holder of Incentive Securities shall cease to be a holder of such Incentive Securities, (ii) such holder’s name shall be removed from each applicable register, (iii) the Incentive Plans and any and all option, award or similar agreements relating to the Incentive Securities shall be terminated and shall be of no further

 

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force and effect, and (iv) each such holder shall cease to have any rights as a holder in respect of such Incentive Securities or under the Incentive Plans and have only the right to receive the consideration, if any, to which it is entitled to, at the time and in the manner specified in the Plan of Arrangement;

 

(13)

each Exchangeable Subscription Receipt that is not exchanged into Shares immediately prior to the Effective Time and that remains outstanding shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation, free and clear of all Liens, in exchange for (i) the Exchangeable Subscription Receipt Cash Consideration with such amount to be paid to the holder in accordance with the Plan of Arrangement less any applicable withholdings and (ii) one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and each such Exchangeable Subscription Receipt shall immediately be cancelled and all of the Corporation’s obligations with respect to each such Exchangeable Subscription Receipt shall be deemed to be fully satisfied;

 

(14)

each outstanding Share held by a Dissenting Holder in respect of which Dissent Rights have been validly exercised shall be deemed to be transferred without any further action by or on behalf of the holder thereof to the Purchaser, free and clear of all Liens, and:

 

(a)

such Dissenting Holder shall cease to be the holder of such Share and to have any rights as a Shareholder, other than the right to be paid the fair value of such Share by the Purchaser in accordance with the Plan of Arrangement;

 

(b)

such Dissenting Holder’s name shall be removed from the register of holders of Shares maintained by or on behalf of the Corporation;

 

(c)

the Purchaser shall be recorded in the register of holders of Shares maintained by or on behalf of the Corporation as the holder of the Shares so transferred, and shall be deemed to be the legal and beneficial owner thereof; and

 

(15)

concurrently with the step set forth above, each outstanding Share (for greater certainty, other than the Shares held by Dissenting Holders who have validly exercised their respective Dissent Rights) shall be transferred without any further action by or on behalf of the holder thereof, to the Purchaser, free and clear of all Liens, in exchange for the Cash Consideration, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR, less any applicable withholdings pursuant to the Plan of Arrangement, and:

 

(a)

the holder of such Share shall cease to be the holder thereof and to have any rights as a Shareholder other than the right to receive the Consideration in accordance with the Plan of Arrangement;

 

(b)

such holder’s name shall be removed from the register of holders of Shares maintained by or on behalf of the Corporation; and

 

(c)

the Purchaser shall be recorded in the register of holders of Shares maintained by or on behalf of the Corporation as the holder of the Shares so transferred, and shall be deemed to be the legal and beneficial owner thereof.

Notwithstanding anything to the contrary, to the extent the Corporation determines that any treatment of any Option, Warrant, SAR or DSU or payment pursuant to the Plan of Arrangement may trigger any tax or penalty under Section 409A of the Code, the Corporation shall be permitted to take any and all actions the Corporation in its sole discretion, after consultation with and approval by Purchaser, deems necessary or advisable to avoid such tax or penalty, including by altering the treatment or payment terms or otherwise providing that such payment shall be made on the earliest date that payment would not trigger such tax or penalty.

The Plan of Arrangement is attached as Appendix B to this Circular and a copy of the Arrangement Agreement is available under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search. See “The Arrangement – Arrangement Steps”.

 

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11.	Required Shareholder Approval

At the Meeting, pursuant to the Interim Order, Shareholders will be asked to consider and, if deemed advisable, to pass the Arrangement Resolution. To be effective, the Arrangement Resolution must be approved by (i) at least 66²⁄₃% of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, and (ii) at least a majority of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, excluding Shares required to be excluded pursuant to Multilateral Instrument 61-101. See “The Arrangement – Required Shareholder Approval”.

 

12.	Support and Voting Agreements

Certain senior officers and directors of the Corporation, who, as at the date hereof, together beneficially own or exercise control or direction over an aggregate of 524,266 Shares, representing in the aggregate approximately 1.14% of the Corporation’s outstanding Shares, have entered into Support and Voting Agreements with the Purchaser, pursuant to which they have agreed, among other things, to vote in favour of the Arrangement Resolution, subject to customary exceptions. The Support and Voting Agreements entered into with the Purchaser can be found under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search. See “The Arrangement – Support and Voting Agreements”.

 

13.	Interest of Certain Persons in the Arrangement

In considering the unanimous recommendations of the Special Committee and the Board, Shareholders should be aware that directors and senior officers of the Corporation and its subsidiaries may have interests in the Arrangement that differ from, or are in addition to, the interests of Shareholders generally. See “The Arrangement – Interest of Certain Persons in the Arrangement”.

 

14.	Arrangement Agreement

On July 2, 2025, the Corporation, the Purchaser and Future Pak entered into the Arrangement Agreement, pursuant to which it was agreed, among other things, to implement the Arrangement in accordance with and subject to the terms and conditions contained in the Plan of Arrangement. This Circular contains a summary of certain provisions of the Arrangement Agreement, which summary does not purport to be complete and is qualified in its entirety by reference to the full text of the Arrangement Agreement (which has been filed by the Corporation under its issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search) and to the Plan of Arrangement (attached to this Circular as Appendix B). Shareholders are encouraged to read the Arrangement Agreement and the Plan of Arrangement carefully and in their entirety as they contain important provisions governing the terms and conditions of the Arrangement. See “The Arrangement Agreement” for a summary of the Arrangement Agreement.

 

15.	Effective Time and Outside Date

Pursuant to section 420 of the QBCA, the Arrangement will become effective on the date the Articles of Arrangement are filed with the Enterprise Registrar, as shown on the Certificate of Arrangement. It is currently anticipated that the Effective Date will occur by the end of the Corporation’s fourth quarter ending November 30, 2025. It is not possible, however, to state with certainty when the Effective Date will occur. The Effective Date could be delayed for a number of reasons, including an objection before the Court at the hearing of the application for the Final Order. As provided under the Arrangement Agreement, the Corporation will file the Articles of Arrangement with the Enterprise Registrar as soon as reasonably practicable and in any event no later than seven Business Days after the satisfaction or waiver of the conditions to the completion of the Arrangement to give effect to the Arrangement.

The Arrangement must be completed on or prior to December 2, 2025, which is the Outside Date, unless the parties to the Arrangement Agreement agree to extend the Outside Date.

 

16.	Court Approval

The Arrangement requires the Court’s granting of the Final Order. Accordingly, on August 8, 2025, the Corporation obtained the Interim Order authorizing and directing the Corporation to call, hold and conduct the Meeting and to submit the Arrangement to the Shareholders for approval. A copy of the Interim Order is attached as Appendix D to this Circular. Subject to the terms of the Arrangement Agreement and receipt of the Required Shareholder Approval, the Corporation will make an application to the Court for the Final Order. The hearing in respect of the Final Order is expected to take place before the Superior Court of Québec (Commercial Division), sitting in the district of Montreal, on September 16, 2025, in room 16.04 of the Courthouse located at 1 Notre-Dame Street East, Montreal, Québec H2Y 1B6, at 2:30 p.m. (Eastern time) (or as soon as counsel may be heard). See “The Arrangement — Court Approval and Completion of the Arrangement”.

 

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17.	Dissent Rights

Pursuant to and in accordance with the Plan of Arrangement, the Interim Order and the provisions of Chapter XIV of the QBCA (as modified or supplemented by the Interim Order, the Plan of Arrangement and any other order of the Court), Registered Shareholders (other than holders of Shares who have failed to exercise all the voting rights carried by the Shares held by such holders against the Arrangement Resolution) may exercise Dissent Rights in connection with the Arrangement and, if the Arrangement becomes effective, to be paid the fair value of their Shares by the Purchaser (subject to any applicable withholdings). Dissent Rights are more particularly described in this Circular in the section “Dissenting Shareholders Rights.”. A Registered Shareholder who wishes to exercise Dissent Rights must send to the Corporation a written notice informing the Corporation of such Shareholder’s intention to exercise Dissent Rights (the “Dissent Notice”), which Dissent Notice must be received by the Corporation at its head office located at 2015 Peel Street, 11th Floor, Montreal, Québec, H3A 1T8, Canada, Attention: Mtre. Jocelyn Lafond, General Counsel and Corporate Secretary, with a copy to Fasken Martineau DuMoulin LLP at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada H3C 0B4, Attention: Mtres. Brandon Farber and Hugo Séguin, not later than 5:00 p.m. (Eastern time) on September 10, 2025 or not later than 5:00 p.m. (Eastern time) on the Business Day that is two Business Days (excluding Saturdays, Sundays and holidays) immediately preceding the date that any adjourned or postponed Meeting is reconvened or held, as the case may be. Failure to strictly comply with the requirements set forth in Chapter XIV of the QBCA (as modified or supplemented by the Interim Order, the Plan of Arrangement and any other order of the Court) may result in the loss of Dissent Rights. Anyone who is a Non-Registered Shareholder who wishes to exercise Dissent Rights should be aware that only Registered Shareholders are entitled to exercise Dissent Rights. Accordingly, a Non-Registered Shareholder desiring to exercise Dissent Rights must make arrangements for the Shares beneficially owned by that holder to be registered in the name of the Shareholder prior to the time the Dissent Notice is required to be received by the Corporation or, alternatively, make arrangements for the registered holder of such Shares to exercise Dissent Rights on behalf of the holder. In such case, the Dissent Notice should specify the number of Shares. A Dissenting Shareholder may only dissent with respect to all the Shares held on behalf of any one beneficial owner and registered in the name of the Dissenting Shareholder, subject to such Dissenting Shareholder exercising all the voting rights carried by such Shares against the Arrangement Resolution. Note that Chapter XIV of the QBCA, the text of which is attached as Appendix F to this Circular, sets forth special provisions which are required to be followed with respect to the exercise of Dissent Rights by Non-Registered Shareholders.

 

18.	Risk Factors

Shareholders should consider a number of risk factors relating to the Arrangement and the Corporation in evaluating whether to approve the Arrangement Resolution. See “Risk Factors”.

 

19.	Delivery of Consideration

Registered Shareholders will have received with this Circular a Letter of Transmittal. In order to receive the Consideration, Registered Shareholders must properly complete and duly execute the Letter of Transmittal and deliver such Letter of Transmittal, together with all other documents and instruments referred to in the Letter of Transmittal or reasonably requested by the Depositary, including the certificate(s) and/or DRS Advice(s) representing the Shares, to the Depositary in accordance with the instructions contained in the Letter of Transmittal. The Letter of Transmittal contains procedural information relating to the Arrangement and should be reviewed carefully. The Cash Consideration payable will be denominated in U.S. dollars, provided that a Registered Shareholder is to be paid a converted amount in Canadian dollars if either (i) it elected to receive the payment in Canadian dollars prior to the Effective Date in its Letter of Transmittal or (ii) its address of record is within Canada and it has not elected to receive the payment in any currency prior to the Effective Date in its Letter of Transmittal. Additional copies of the Letter of Transmittal can be obtained by contacting the Depositary. The Letter of Transmittal for use by Registered Shareholders can also be found under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search.

Non-Registered Shareholders holding their Shares through an Intermediary should contact that Intermediary for instructions and assistance and carefully follow any instructions provided to them by such Intermediary for the Consideration.

 

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See “Arrangement Mechanics – Delivery of Consideration” and “Letters of Transmittal”.

 

20.	Certain Canadian Federal Income Tax Considerations

This Circular contains a summary of certain Canadian federal income tax considerations generally applicable to certain Shareholders who, under the Arrangement, dispose of one or more Shares. See “Certain Canadian Federal Income Tax Considerations”, for a general summary of certain Canadian federal income tax considerations relevant to Shareholders. Such summary is not intended to be legal or tax advice. All Shareholders should also consult their own tax advisors regarding relevant provincial, territorial, state or local tax considerations of the Arrangement. This Circular does not address the tax consequences of the Arrangement to holders of Exchangeable Subscription Receipts, Warrants or Incentive Securities. Such holders should consult their own tax advisors in this regard.

Shareholders who are residents of Canada for purposes of the Tax Act will generally realize a disposition of their Shares under the Arrangement for income tax purposes. The Canadian income tax consequences in respect of the receipt, holding and disposition of the CVRs, including the tax consequences of the receipt of payments pursuant to the CVRs, are not entirely free from doubt. Shareholders should carefully read the information in this Circular under the heading “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada” and are urged to consult their own tax advisors having regard to their own particular circumstances. Shareholders who are not residents of Canada for purposes of the Tax Act and that do not hold their Shares as “taxable Canadian property” (as defined in the Tax Act) will generally not be subject to tax under the Tax Act on the disposition of their Shares under the Arrangement. See “Certain Canadian Federal Income Tax Considerations– Holders Not Resident in Canada.”

Shareholders are urged to consult their own tax advisors as to the tax consequences of the Arrangement to them with respect to their particular circumstances.

 

21.	Certain United States Federal Income Tax Considerations

Subject to the discussion in “Certain United States Federal Income Tax Considerations” and assuming the Corporation is not, and has not been, a PFIC (as defined in such section), a U.S. Shareholder who holds Shares as capital assets and who sells such Shares pursuant to the Arrangement and receives the Consideration generally will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference between the amount received and the U.S. Shareholder’s adjusted tax basis in the Shares. The foregoing description of U.S. federal income tax consequences of the Arrangement is qualified in its entirety by the more detailed discussion under “Certain United States Federal Income Tax Considerations” below, including with respect to the CVR, and neither this description nor the more detailed discussion is intended to be legal advice to any particular Shareholder residing in the United States. Accordingly, U.S. Shareholders should consult their tax advisors with respect to their particular circumstances.

 

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ITEM VII.

INFORMATION CONCERNING THE MEETING

 

1.	Purpose of the Meeting

At the Meeting, Shareholders will be asked to consider and, if deemed advisable, to pass, with or without variation, the Arrangement Resolution (a copy of which is attached as Appendix C to this Circular) and to transact such other business as may properly come before the Meeting.

 

2.	Date, Time, Place of the Meeting, Record Date and Quorum

The Meeting will be held in hybrid format on Friday, September 12, 2025 at 10:00 a.m. (Eastern time), in person at the offices of Fasken Martineau DuMoulin LLP located at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada and virtually via live audio webcast at https://meetnow.global/MDUWLGW. The Board has fixed August 13, 2025 as the Record Date, being the date for the determination of the Shareholders entitled to receive notice of, and to vote at, the Meeting or any adjournment(s) or postponement(s) thereof. A quorum of Shareholders will be present at the Meeting, regardless of the actual number of persons present in person or virtually, if one or more holder of Shares, representing not less than ten percent (10%) of the total number of votes attached to all the Shares, are present in person or virtually or duly represented by proxy at the Meeting.

 

3.	Availability of Proxy Materials

The Corporation is not relying on the notice-and-access delivery procedures outlined in National Instrument 54-101 –

Communication with Beneficial Owners of Securities of a Reporting Issuer to distribute copies of the proxy-related materials in connection with the Meeting. As a result, all Shareholders will receive paper copies of the Circular and related materials via prepaid mail, which includes both Registered Shareholders and Non-Registered Shareholders.

 

4.	How to Vote at the Meeting

The manner in which you vote your Shares depends on whether you are a Registered Shareholder or a Non-Registered Shareholder. You are a “Registered Shareholder” if you have a DRS Advice or share certificate issued in your name and you appear as the Registered Shareholder on the books of the Corporation. You are a “Non-Registered Shareholder” if your Shares are registered in the name of an intermediary, generally being a securities broker, financial institution, investment dealer, trust company, custodian, depositary, nominee or other intermediary (collectively “Intermediaries”, and each an “Intermediary”).

Under applicable Securities Laws, there are two types of Non-Registered Shareholders: (i) a “non-objecting beneficial owner” (“NOBO”) when such Non-Registered Shareholder has or is deemed to have provided instructions to the Intermediary holding the securities on such Shareholder’s behalf not objecting to the Intermediary disclosing ownership information about the Non-Registered Shareholder in accordance with said legislation; and (ii) an “objecting beneficial owner” when such Non-Registered Shareholder has or is deemed to have provided instructions objecting to same.

Voting by proxy before the Meeting

You may vote before the Meeting by completing your form of proxy or voting instruction form in accordance with the instructions provided therein. Non-Registered Shareholders should also carefully follow all instructions provided by their Intermediaries to ensure their Shares are voted at the Meeting. Each Intermediary has its own mailing procedures and provides its own return instructions, which should be carefully followed by Non-Registered Shareholders in order to ensure that their Shares are voted at the Meeting.

The persons named in the form of proxy and voting instruction form are directors of the Corporation. However, as further described herein, you may choose another person to act as your proxyholder, including someone who is not a shareholder of the Corporation, by inserting another person’s name in the blank space provided in the form of proxy or voting instruction form. See “Appointment of a Third Party as Proxy” below.

The persons named or appointed in the form of proxy will vote your Shares in respect of which they are appointed as proxies in accordance with the instructions given in the form of proxy. In the absence of instructions, the voting rights attached to the Shares referred to in your form of proxy will be exercised FOR the matters mentioned in the form of proxy or voting instruction form.

 

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Whether or not you expect to attend the Meeting, we encourage you to take the time to complete, sign, date and return the enclosed form of proxy or voting instruction form, as applicable, in accordance with the instructions set out therein so that your Shares can be voted at the Meeting, in accordance with one of the voting methods set forth in the table below.

 

Voting Method		Registered Shareholders		Non-Registered Shareholders
		If your Shares are held in your name and represented by a share certificate or DRS Advice		If your Shares are held with an Intermediary or a depository (such as CDS Clearing and Depository Services Inc. or Depository Trust Company)
Via the internet		Go to www.investorvote.com. Enter the 15-digit control number printed on your form of proxy and follow the instructions on screen.		Go to www.proxyvote.com. Enter the 16- digit control number printed on your voting instruction form and follow the instructions on the screen.
By email		You will need to scan your completed and signed proxy form and email it to service@computershare.com.		Follow the instructions provided by your Intermediary.
By Smartphone		Scan the QR code on your form of proxy and follow the instructions.		Follow the instructions provided by your Intermediary.
By telephone		Vote by telephone at 1-866-732-8683 within North America (toll-free) or 312-588-4290 outside North America using the 15-digit control number printed on your form of proxy.		Vote by telephone (toll-free) at 1-800-474- 7493 (English) or 1-800-474-7501 (French) using the 16-digit control number provided on the voting instruction form.
By mail		Computershare Investor Services Inc., 320 Bay Street, 14th Floor, Toronto, Ontario M5H 4A6, Attention: Proxy Department.		Complete, date and sign the voting instruction form and return it in the enclosed postage paid envelope.
By fax		Complete the proxy form or voting instruction form, as applicable, and return it by fax at 416 263-9524 or 1 866 249-7775.		Follow the instructions provided by your Intermediary.

The Corporation may utilize Broadridge’s QuickVote^™ service to assist eligible Non-Registered Shareholders with voting their Shares over the telephone. In accordance with applicable Securities Laws, certain Non-Registered Shareholders who are NOBOs may be contacted by Laurel Hill Advisory Group, which is soliciting proxies on behalf of the management of the Corporation, to conveniently obtain a vote directly over the telephone.

 

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Voting at the Meeting

Registered Shareholders may vote at the Meeting by completing a ballot online during the Meeting, as further described below. See “How do I attend, participate and vote at the Meeting” below.

Non-Registered Shareholders who have not duly appointed themselves as proxyholder will NOT be able to vote at the Meeting. This is because the Corporation and its transfer agent do not have a record of the Non-Registered Shareholders of the Corporation and, as a result, will have no knowledge of your shareholdings or entitlement to vote, unless you appoint yourself as a proxyholder. If you are a Non-Registered Shareholder and wish to vote at the Meeting, you MUST appoint yourself as proxyholder, by inserting your own name in the space provided on the voting instruction form sent to you and must follow all of the applicable instructions provided by your Intermediary. See “Appointment of a Third Party as Proxy” and “How do I attend, participate and vote at the Meeting” below.

Appointment of a Third Party as Proxy

The following applies to Shareholders who wish to appoint a person (a “Third Party Proxyholder”) other than the nominees set forth in the form of proxy or voting instruction form as proxyholder, including Non-Registered Shareholders who wish to appoint themselves as proxyholder to attend, participate or vote at the Meeting.

Shareholders who wish to appoint a Third Party Proxyholder to attend, participate or vote at the Meeting as their proxy and vote their Shares MUST submit their form of proxy or voting instruction form (as applicable) appointing such Third Party Proxyholder AND register the Third Party Proxyholder, as described below. Registering the Third Party Proxyholder is an ADDITIONAL step to be completed AFTER you have submitted your form of proxy or voting instruction form. Failure to register the Third Party Proxyholder will result in the proxyholder not receiving a Username to attend, participate or vote online at the Meeting. However, if a Third Party Proxyholder is to attend the Meeting in person, such Username will NOT be necessary.

Below are the steps to appoint a Third Party Proxyholder:

 

•

Step 1 - Submit your form of proxy or voting instruction form: To appoint a Third Party Proxyholder, insert such person’s name in the blank space provided in the form of proxy or voting instruction form (if permitted) and follow the instructions for submitting such form of proxy or voting instruction form. This must be completed prior to registering such Third Party Proxyholder, which is an additional step to be completed once you have submitted your form of proxy or voting instruction form.

If you are a Non-Registered Shareholder located in the United States, you must also provide Computershare with a duly completed legal proxy if you wish to attend, participate or vote at the Meeting or, if permitted, appoint a third party as your proxyholder. See below for additional details.

 

•

Step 2 - Register your proxyholder: To register a Third Party Proxyholder, shareholders MUST visit www.computershare.com/Theratech prior to 10:00 a.m. (Eastern time) on September 10, 2025, and provide Computershare with the required proxyholder contact information, so that Computershare may provide the Third Party Proxyholder with a Username via email. Without a Username, a Third Party Proxyholder will not be able to vote online at the Meeting. If such Third Party Proxyholder is to attend the Meeting in person, such Username will NOT be necessary

If you are a Non-Registered Shareholder and wish to attend, participate or vote at the Meeting, you have to insert your own name in the space provided on the voting instruction form sent to you by your Intermediary, follow all of the applicable instructions provided by your Intermediary AND register yourself as a Third Party Proxyholder, as described above. By doing so, you are instructing your Intermediary to appoint you as proxyholder. It is important that you comply with the signature and return instructions provided by your Intermediary. Please also see further instructions below under the heading “How do I attend, participate and vote at the Meeting?”.

If you are a Non-Registered Shareholder located in the United States and wish to attend, participate or vote at the Meeting or, if permitted, appoint a Third Party Proxyholder, in addition to the steps described above and below under “How

 

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do I attend, participate and vote at the Meeting?”, you must obtain a valid legal proxy from your Intermediary. Follow the instructions from your Intermediary included with the legal proxy form and the voting information form sent to you, or contact your Intermediary to request a legal proxy form or a legal proxy if you have not received one. After obtaining a valid legal proxy from your Intermediary, you must then submit such legal proxy to Computershare. Requests for registration from Non-Registered Shareholders located in the United States that wish to attend, participate or vote at the Meeting or, if permitted, appoint a third party as their proxyholder must be sent by email or by courier to USLegalProxy@computershare.com (if by email), or Computershare Investor Services Inc., 320 Bay Street, 14^th Floor, Toronto, Ontario, Canada M5H 4A6 (if by courier), and in both cases, must be labeled as “legal proxy” and received prior to 10:00 a.m. (Eastern time) on September 10, 2025.

How do I attend, participate and vote at the Meeting?

The Corporation is holding the Meeting as a hybrid meeting, on Friday, September 12, 2025 at 10:00 a.m. (Eastern time), in person at the offices of Fasken Martineau DuMoulin LLP located at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada and virtually via live audio webcast at https://meetnow.global/MDUWLGW.

Registered Shareholders and duly appointed proxyholders will be able to attend, participate and vote at the Meeting. Such persons may then enter the virtual Meeting by clicking “I have a login” and by entering a Username before the start of the virtual Meeting:

 

•

Registered Shareholders: The 15-digit control number located on the form of proxy or in the email notification you received is the Username.

If as a Registered Shareholder you are using your control number to login to the Meeting and you accept the terms and conditions, you will be provided the opportunity to vote by online ballot on the matters put forth at the Meeting. Voting online during the meeting will revoke any and all previously submitted proxies for the meeting. If you do not wish to revoke a previously submitted proxy, do not vote at the Meeting.

 

•

Third Party Proxyholders: Computershare will provide the registered Third Party Proxyholder with a Username by email following the expiry of the registration deadline, which is 10:00 a.m. (Eastern time) on September 10, 2025.

Only Registered Shareholders and duly registered Third Party Proxyholders will be entitled to attend, participate and vote at the Meeting whether in person or virtually. Non-Registered Shareholders who have not duly appointed themselves as proxyholder will NOT be able to attend the Meeting in person, but will be able to attend the Meeting virtually as “guests” only and will NOT be able to vote and ask questions at the Meeting.

Shareholders who wish to appoint a Third Party Proxyholder to represent them at the Meeting (including Non-Registered Shareholders who wish to appoint themselves as proxyholder to attend, participate or vote at the Meeting) MUST submit their duly completed proxy or voting instruction form AND register the Third Party Proxyholder. See “Appointment of a Third Party as Proxy” above.

If you are a Non-Registered Shareholder located in the United States and wish to attend, participate or vote at the Meeting or, if permitted, appoint a Third Party Proxyholder, you MUST also submit your legal proxy to Computershare. See “Appointment of a Third Party as Proxy” above.

If you or your Third Party Proxyholder attend the Meeting virtually and are entitled to vote, it will be important that you or your Third Party Proxyholder remain connected to the internet at all times during the Meeting in order to vote when balloting commences. You or your Third Party Proxyholder must ensure connectivity for the duration of the Meeting. You or your Third Party Proxyholder should allow enough time to check into the Meeting online and complete the related procedure.

If you or your Third Party Proxyholder attend the Meeting in person, please check in at the registration desk with our transfer agent, Computershare, when you arrive at the offices of Fasken Martineau DuMoulin LLP located at 800 Square Victoria, Suite 3500, Montreal, Québec, Canada.

 

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How to Vote Virtually During the Meeting?

Once voting has opened, the voting tab will appear on the navigation bar at the top of your screen. The resolution and voting choices will then be displayed. After you vote, a message confirming “vote received” will appear. Your vote can be changed by simply clicking on the other option. If you wish to cancel your vote, please press “cancel”.

Can I ask questions at the virtual Meeting?

Registered Shareholders and duly registered Third Party Proxyholders who log into the Meeting will be entitled to ask questions in writing during the Meeting by using the “Q&A” tab of the platform that will be available for that purpose. Persons logging into the virtual Meeting as “guest” will not be able to ask questions during the Meeting. Questions will be reviewed by the Corporation during the Meeting, but not all questions will be answered by directors or members of management attending the Meeting. Questions for which answers will be provided during the Meeting will be read and answered verbally by directors and/or members of management attending the Meeting. The Corporation does not undertake to answer all of the questions asked nor to communicate with each individual who asked questions during the Meeting to provide them with the answers thereof.

Difficulties in Accessing the virtual Meeting

Internal network security protocols including firewalls and VPN connections may block access to the Computershare platform. If you are experiencing any difficulty connecting or watching the Meeting, ensure your VPN setting is disabled or use a computer on a network not restricted to security settings or your organization. For further help, contact Computershare, at 1-800-564-6253 (toll-free in Canada and the United States) or 1-514-982-7555 (from outside of Canada and the United States), or by email at service@computershare.com.

Who can I contact with questions?

If you require assistance with voting or in completing your form of proxy or voting instruction form, please contact Laurel Hill Advisory Group, our shareholder communications advisor and proxy solicitation agent, by telephone at 1-877-452-7184 (toll-free in North America) or at 1-416-304-0211 (outside of North America), or by email at assistance@laurelhill.com.

 

5.	Appointment and Revocation of Proxies

By returning a form of proxy or voting instruction form, you are authorizing the person named in the proxy or voting instruction form to attend the Meeting and vote your Shares on each item of business according to your instructions. The persons named in the enclosed form of proxy or voting instruction form are officers and/or directors of the Corporation.

A Registered Shareholder desiring to appoint some other person or company, who need not be a Shareholder, to represent him or her at the Meeting, may do so by inserting such person’s name in the blank space provided in the enclosed form of proxy or by completing another proper form of proxy and, in either case, depositing the completed and executed proxy in the manner described above.

A Non-Registered Shareholder desiring to appoint some other person or company, who need not be a Shareholder, to represent him or her at the Meeting, may do so by following the instructions on the voting instruction form.

A Registered Shareholder who has submitted a proxy may revoke such proxy by: (a) completing and signing a proxy bearing a later date and depositing it with Computershare in accordance with the instructions set out above, or (b) depositing an instrument in writing executed by the Registered Shareholder or by such Shareholder’s personal representative authorized in writing (i) at the office of Computershare no later than 10:00 a.m. (Eastern time) on September 10, 2025 (or not later than 48 hours, excluding Saturdays, Sundays and statutory holidays, before any reconvened meeting if the Meeting is adjourned or postponed), (ii) with the Chair of the Meeting, prior to the commencement of the Meeting on the day of the Meeting, or where the Meeting has been adjourned or postponed, prior to the commencement of the reconvened or postponed Meeting on the day of such reconvened or postponed Meeting, or (iii) in any other manner permitted by law. In addition, if you are a Registered Shareholder, once you registered with the transfer agent upon your arrival to the Meeting, you may (but are not obliged to) revoke any and all previously submitted proxies by voting by poll on the matters put forth at the Meeting. If you attend the Meeting but do not vote by poll, your previously submitted proxy will remain valid.

 

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The revocation of a proxy does not affect any matter on which a vote has been taken before the revocation.

 

6.	Exercise of Vote by Proxy

The Shares represented by properly executed proxies will be voted for or against any matter to be acted upon where such Shareholder specifies a choice for such matter. In respect of proxies in favour of management proxyholders in which Shareholders have failed to specify the manner of voting, the Shares represented by such proxies will be voted FOR the Arrangement Resolution.

The form of proxy also confers discretionary authority upon the management proxyholders in respect of amendments or variations to matters identified in the notice of Meeting or other matters that may properly come before the Meeting or any adjournment(s) or postponement(s) thereof. Management knows of no amendments, variations or other matters to come before the Meeting other than the matters referred to in the notice calling the Meeting. However, if any amendments, variations or other matters which are not now known to management should properly come before the Meeting or any adjournment(s) or postponement(s) thereof, the Shares represented by proxies in favour of management proxyholders will be voted on such amendments, variations or other matters in accordance with the best judgment of the proxyholder.

 

7.	Solicitation of Proxies

It is expected that solicitations of proxies will be made primarily by mail and supplemented by telephone or other personal contact by directors, officers and employees of the Corporation without special compensation. The Corporation has also retained Laurel Hill Advisory Group as shareholder communications advisor and proxy solicitation agent to, among other things, assist in the solicitation of proxies and may also retain other persons as the Corporation deems necessary to aid in the solicitation of proxies with respect to the Meeting. Except as provided in the Arrangement Agreement, the costs of soliciting proxies and printing and mailing this Circular in connection with the Meeting will be borne by the Corporation. The Corporation and Laurel Hill Advisory Group have entered into an engagement agreement with customary terms and conditions providing for proxy solicitation and advisor services to be provided by Laurel Hill Advisory Group for a fixed fee of CAD$70,000, plus reasonable out-of-pocket expenses, as well as certain fees in respect of retail shareholder calls and communications.

The Corporation has distributed copies of this Circular and other related materials to Intermediaries for onward distribution to Non-Registered Shareholders. The Intermediaries are required to forward the Meeting materials to such Non-Registered Shareholders. The Corporation intends to reimburse such Intermediaries for permitted fees and costs incurred by them in mailing the Meeting materials to beneficial owners.

The Corporation is not relying on the notice-and-access delivery procedures outlined in National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer to distribute copies of the proxy-related materials in connection with the Meeting.

 

8.	Voting Shares and Principal Holders Thereof

As of the date of this Circular, the Shares are the only outstanding voting shares of the Corporation. The holders of Shares as at the close of business on the Record Date are entitled to vote on all matters brought before a meeting of the Shareholders. The holders of Shares are entitled to one vote per Share. As at the date hereof, there are 45,980,019 Shares issued and outstanding.

The Arrangement Resolution must be approved by (i) at least 66²⁄₃% of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, and (ii) at least a majority of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, excluding Shares required to be excluded pursuant to Multilateral Instrument 61-101.

As at the date hereof, to the knowledge of the directors and senior officers of the Corporation the following persons beneficially owned, directly or indirectly, or exercised control or direction over more than 10% of the voting rights attached to the Shares:

 

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Name		Number of Shares				Percentage of Outstanding Shares
Investissement Québec			9,118,184				19.8	%
Soleus Capital Master Fund, L.P.			4,801,375				10.4	%

 

9.	Other Matters

As of the date of this Circular, the Corporation has no knowledge of any additional business that will be presented at the Meeting other than to consider the Arrangement Resolution.

 

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ITEM VIII.

THE ARRANGEMENT

 

1.	Purpose of the Arrangement

The purpose of the Arrangement is to effect the acquisition of the Corporation by the Purchaser by way of a statutory plan of arrangement under Chapter XVI — Division II of the QBCA. Pursuant to the Arrangement Agreement, the Purchaser has agreed to acquire all of the issued and outstanding Shares for $3.01 in cash per Share and one (1) CVR to be issued by the Purchaser, subject to any applicable withholdings. Upon completion of the Arrangement, among other things, the Purchaser will acquire all of the issued and outstanding Shares and the Corporation will become a privately-held wholly-owned subsidiary of the Purchaser.

 

2.	Background to the Arrangement

The entering into of the Arrangement Agreement is the result of the Strategic Review, completed under the oversight of the Special Committee and extensive arm’s length negotiations conducted between the Corporation and Future Pak and their respective advisors. The following is a summary of the main events that led to the execution of the Arrangement Agreement and related definitive transaction documents, and certain meetings, negotiations, discussions and actions of the parties that preceded the execution of the Arrangement Agreement on July 2, 2025, and the public announcement of the Arrangement on such date.

As part of its ongoing mandate to act in the best interests of the Corporation, the Board, with the assistance of the Corporation’s management and advisors, routinely evaluates the Corporation’s performance, future growth prospects, capital requirements, overall corporate strategy and long-term strategic plans as well as potential strategic alternatives with the goal of expanding and strengthening the Corporation’s business and increasing shareholder value.

In 2023, the Corporation faced various challenges, including a declining price for the Shares and difficulties raising capital, which led the Corporation to explore potential commercialization partnerships and evaluate strategic alternatives.

In November 2023, the Board engaged Barclays as its exclusive financial advisor in the event the foregoing circumstances were to result in the Board having to consider a proposal for a strategic transaction involving the Corporation.

On December 1, 2023, Barclays recommended that all potential opportunities be explored, and management of the Corporation and the Board instructed Barclays to conduct a targeted confidential outreach to third party pharmaceutical companies to discuss business development opportunities.

During 2023, the price of the Shares fluctuated between CAD$1.24 and CAD$6.20 and $0.89 and $4.48, respectively, on each of the TSX and Nasdaq, and, as of December 29, 2023, the last trading day in 2023, the closing price of the Shares on each of the TSX and Nasdaq was CAD$2.14 and $1.62, respectively.

On February 29, 2024, the Board met, with members of management, Barclays and Fasken present, and, after reviewing business development opportunities and certain unsolicited non-binding proposals received by the Corporation to such date and on Barclays’ recommendation, decided to proceed with a confidential targeted market check to assess if there was a basis to pursue a strategic transaction for the acquisition of the Corporation (the “First Targeted Market Check”).

Following the receipt and consideration of certain non-binding indications of interest resulting from such First Targeted Market Check, on July 3, 2024, the Board decided to end the First Targeted Market Check due to proposals received being unsatisfactory and, on July 22, 2024, Barclays’ engagement was also terminated.

On August 12, 2024, the Corporation received a first unsolicited indication of interest from Future Pak (the “First Future Pak Proposal”), which offered $100 million in cash payable at closing and a CVR tied to value received through the EGRIFTA franchise, with a maximum payment of $50 million. The First Future Pak Proposal was determined by the Board to be an unsatisfactory proposal.

Following the receipt of certain written and/or verbal indications of interest from third parties during the period of August 2024 to November 2024, including the First Future Pak Proposal, and a letter from Soleus, a significant shareholder of the Corporation, indicating that it believed the best path forward for the Corporation was to pursue a merger or acquisition by another company to leverage the Corporation’s assets, on November 21, 2024, the Board formed an ad hoc Committee of independent directors —

 

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Frank Holler (Chair), Andrew Molson, and Dawn Svoronos — to review acquisition proposals and other strategic alternatives for the Corporation (the “Strategic Review”). Barclays was re-engaged as financial advisor and Fasken was engaged as legal advisor to support both the Corporation and the Special Committee during the Strategic Review.

During November and December 2024, Barclays re-engaged with four (4) companies who were active potential acquirors during the First Targeted Market Check, as a refresh, as well as one (1) supplemental potential acquiror (the “Market Check Refresh”). Ultimately, none of such five (5) potential acquirors wanted to re-engage and/or present a proposal at such time, however, the Corporation would have subsequent exchanges with one (1) of such potential acquirors (“Bidder B”).

During 2024, the price of the Shares fluctuated between CAD$1.60 and CAD$3.05 and $1.17 and $2.30, respectively, on each of the TSX and Nasdaq, and, as of December 31, 2024, the last trading day in 2024, the closing price of the Shares on each of the TSX and Nasdaq was CAD$2.62 and $1.81, respectively.

Following subsequent exchanges with Bidder B, the Corporation received a non-binding indication of interest from Bidder B on January 2, 2025, which led to further negotiations, and, on January 12, 2025, the execution of an exclusivity agreement with Bidder B which provided for an initial exclusivity period ending February 26, 2025.

On January 15, 2025, the Corporation received a second unsolicited acquisition proposal for the acquisition of the Corporation from Future Pak (the “Second Future Pak Proposal”), but due to the exclusivity agreement with Bidder B, the Corporation was unable to engage with Future Pak.

On February 18, 2025, the Special Committee met and agreed not to immediately renew Bidder B’s exclusivity expiring on February 26, 2025 in order to provide a window of time during which they could evaluate the Second Future Pak Proposal.

Subsequent to the February 26, 2025 expiration of the exclusivity agreement with Bidder B, the Special Committee, based on the advice of its legal and financial advisors, discussed the relative merits of re-entering into exclusivity with Bidder B, and determined that it could consider a limited duration renewed exclusivity period if Bidder B would agree, in the event that the two parties were to reach a definitive agreement, to allow for a “go-shop” period with a two-tiered break fee. Bidder B acknowledged that it would agree to a “go-shop” period which would allow the Corporation to solicit additional offers for the Corporation. 

After further consideration of the then current proposals from each of Future Pak and Bidder B, as well as further engagement with Future Pak regarding certain aspects of its proposal, on March 5, 2025, the Special Committee, considering the advice of management and its legal and financial advisors, determined to extend exclusivity with Bidder B for fifteen (15) days.

On March 9, 2025, the Corporation received a third unsolicited acquisition proposal from Future Pak.

On March 11, 2025, the Special Committee met, with management and Fasken present, to receive an update from Barclays on discussions with Bidder B and Future Pak and to discuss next steps. Board member Jordan Zwick was also invited for additional expertise. It was agreed that: (i) a non-disclosure agreement (“NDA”) containing a standard standstill provision would be prepared for signature by Future Pak; and (ii) the Corporation would continue negotiating an exclusivity extension with Bidder B, to be entered into following completion of Future Pak’s preliminary due diligence once under an NDA.

On March 12, 2025, Future Pak indicated it would not sign an NDA containing a standstill without having been granted exclusivity.

In each of February and March 2025, a potential acquiror (“Bidder C”), who had previously submitted two unsolicited non-binding indications of interest to the Corporation in late 2024, reached out to each of Barclays and the Chair of the Special Committee to indicate an on-going interest in engaging with the Corporation.

On March 15, 2025, the Corporation received a fourth unsolicited acquisition proposal from Future Pak.

On each of March 13 and March 15, 2025, meetings of the Special Committee were held to receive updates and discuss approaches in respect of each of Future Pak, Bidder B and Bidder C. Taking into consideration Future Pak’s indication that it would not sign an NDA including a standstill, the Special Committee determined it was advisable to renew exclusivity with Bidder B. On March 17, 2025, Barclays communicated to Future Pak that the Corporation was extending exclusivity with Bidder B. On March 22, 2025, Future Pak sent the Chair of the Special Committee and Barclays its signature to a draft mutual NDA,

 

- 33 -

but, as the Corporation had re-entered exclusivity with Bidder B earlier on the same day, Barclays reiterated to Future Pak that it was unable to engage with Future Pak at such time.

Following renewed exclusivity being granted to Bidder B, the Corporation and Bidder B and their respective financial and legal advisors advanced due diligence as well as drafting of legal documentation in connection with a potential transaction.

On March 28, 2025, Raymond James was retained as independent financial advisor to provide the Special Committee with strategic advice in the context of the Strategic Review and for the purposes of delivering an independent fairness opinion, as needed.

On April 11, 2025, Future Pak issued a press release (the “Future Pak Press Release”) announcing that, since January 2025, it had submitted two formal proposals to acquire all of the outstanding Shares, the latest proposal offering cash consideration of $3.51 to $4.50 per Share. On April 10, 2025, the last trading day prior to such announcement, the closing price of the Shares on each of the TSX and Nasdaq was CAD$1.85 and $1.33, respectively.

On April 11, 2025, following the issuance of the Future Pak Press Release, the Board received a letter from Soleus, holder of 10.4% of issued and outstanding Shares at such time, urging the Corporation to engage with Future Pak.

On April 11, 2025, the Corporation released a statement clarifying certain facts in the Future Pak Press Release, indicating that it was under exclusivity with an unnamed third party and informing the public that the Special Committee had been formed to review proposals received and determine the course of action that was in the best interests of the Corporation and its stakeholders.

On April 12, 2025, Future Pak’s advisor relayed to Barclays that the Future Pak Press Release was issued to publicly register their offer amid rumors they would not have an opportunity to compete, and that Future Pak was ready to engage, having done considerable work using public information.

On April 14, 2025, the Special Committee, following discussions with its advisors, determined that the final offer received the prior day from Bidder B (the “Final Bidder B Offer”) was insufficient and agreed (i) to give Bidder B 24 hours to improve its offer and (ii) that if a satisfactory revision to the then current offer was not received within 24 hours, the Corporation would terminate exclusivity and issue a press release announcing the Corporation had decided to further evaluate the sale of the Corporation by way of an open and non-exclusive sale process (the “Sale Process”) and, in light of the public nature of the potential sale of the Corporation following the Future Pak Press Release, the Special Committee retained Norton Rose as its independent legal advisor.

On April 15, 2025, at a meeting of the Board, with management, Barclays, Fasken and Norton Rose present, the Board appointed Jordan Zwick as a formal member of the Special Committee and the Special Committee provided the Board with an update on recent developments following the Future Pak Press Release, as well as the Special Committee’s suggested strategy in respect of Bidder B.

Later in the day on April 15, 2025, as Bidder B had not improved the offer it had previously made, the Corporation issued a press release announcing the Sale Process and entered into an NDA with Future Pak.

On April 18, 2025, the Special Committee met, with Norton Rose, Fasken, Barclays and Raymond James present, and, following a presentation by Barclays and on the advice of its legal and financial advisors, the Special Committee determined to re-engage with the two counterparties who expressed interest during Bidder B’s exclusivity periods (namely, Future Pak and Bidder C), plus a targeted market check to see if any other potential bidders would be interested in participating in the Sale Process (the “Second Targeted Market Check” and, together with the First Targeted Market Check and the Market Check Refresh, the “Targeted Market Checks”).

Twenty (20) potential bidders (including Future Pak and Bidder C) were contacted as part of the Second Targeted Market Check and Barclays received unsolicited inbound reach outs from three (3) other potential bidders, following which five (5) parties executed NDAs and four (4) parties attended management presentations.

On May 21, 2025, another significant shareholder of the Corporation (the “Significant Shareholder”) signed a confidentiality undertaking in order for the Corporation to discuss with such shareholder its possible support of a potential transaction for the acquisition of the Corporation.

 

- 34 -

On May 22, 2025, a fifth revised offer was received from Future Pak (the “Fifth Future Pak Proposal”) and a revised offer was received from Bidder C. During the Second Targeted Market Check, Bidder B had reiterated that it would not change the Final Bidder B Offer. No offers were received from the other three (3) counterparties with whom NDAs were executed as part of the Second Targeted Market Check.

The Fifth Future Pak Proposal included a “SpinCo” concept to house certain assets and management of the Corporation. Such proposal was accompanied by a draft debt commitment letter from a potential lender to Future Pak (the “Debt Commitment Letter”).

On May 23, 2025, the Special Committee met, with Norton Rose, Fasken, Barclays and Raymond James present, to discuss the proposals received and (without Barclays present) Raymond James provided its preliminary financial analysis in respect of the Corporation. The Special Committee determined to continue engaging with Future Pak and Bidder B. Following such meeting, on the Special Committee’s instruction, Barclays requested a revised offer from Future Pak removing the “SpinCo” concept.

On May 25, 2025, a further revised offer was received from Future Pak (the “Sixth Future Pak Proposal”) for the aggregate price of $190 million in cash at closing, subject to a closing net debt adjustment in the event the closing net debt of the Corporation moved more than $3.5 million either upward or downward, and a CVR tied to value received through the EGRIFTA and Trogarzo franchises, with a maximum payment of $65 million, and which offer no longer contained the “SpinCo” concept.

On May 26, 2025, the Special Committee met, with management, Norton Rose, Fasken, Barclays and Raymond James present, to consider the Sixth Future Pak Proposal and (without management and Raymond James present) Barclays presented a preliminary financial analysis of the Corporation. Considering, among other things, the Targeted Market Checks that had been performed by the Corporation over the course of 2024 and 2025 and the strength of the Sixth Future Pak Proposal from a financial point of view as compared to the most recent offer received from Bidder B, as well as the fact that each of Barclays and Raymond James confirmed that, if requested by the Special Committee, they would be in a position to issue customary fairness opinions, subject to the assumptions, limitations and qualifications to be set forth therein, to the effect that the consideration to be received by Shareholders based on the Sixth Future Pak Proposal would be fair, from a financial point of view, to such Shareholders, the Special Committee agreed to continue to engage with Future Pak, with a goal of negotiating, signing and announcing a definitive agreement as soon as possible.

On May 29, 2025, the Chair of the Special Committee, along with Fasken, met with representatives of the Significant Shareholder to present the Sixth Future Pak Proposal to them and discuss such shareholder’s possible support for a potential transaction on the terms set out in the Sixth Future Pak Proposal with Future Pak.

In the weeks that followed, the Special Committee, with the support of Norton Rose, Fasken, Barclays and Raymond James, in collaboration with management, oversaw the negotiation with Future Pak of the Arrangement Agreement to be entered into by the Corporation with the Purchaser and Future Pak, and the ancillary documents thereto.

Between May 26, 2025 and July 2, 2025, the Corporation and Future Pak, and their respective legal and financial advisors, held several calls and meetings and exchanged and negotiated drafts of the Arrangement Agreement, which included a form of CVR Agreement, and the Debt Commitment Letter. In addition, Future Pak and its advisors continued to conduct confirmatory due diligence and held several meetings with management and the Corporation’s advisors.

On June 19, 2025, the Significant Shareholder contacted the Chair of the Special Committee and indicated in general terms that it might be willing to offer some form of financial support to a potential buyer, subject to such buyer agreeing to certain undertakings in respect of the Corporation’s presence in Québec, and request that such possibility be discussed with the bidders involved in the Second Targeted Market Check (including each of Future Pak and Bidder B).

On June 21, 2025, the Special Committee met to discuss the approach from the Significant Shareholder. On June 22, 2025, on instruction from the Special Committee, Barclays (i) communicated the Significant Shareholder’s interest in considering the possibility of some form of financial support for a transaction in exchange for certain undertakings with Future Pak and (ii) contacted Bidder B’s advisors to share the Significant Shareholder’s interest in considering the possibility of some form of financial support for a transaction in exchange for certain undertakings and requested that Bidder B consider such proposal and submit a revised offer on such basis.

 

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On June 23, 2025, while negotiations were progressing with Future Pak, as the Corporation was not under exclusivity with Future Pak, Barclays did a final reach out to Bidder B’s advisors, who indicated that Bidder B would not be submitting a revised offer, despite the possibility of some form of financial support for a transaction from the Significant Shareholder.

On June 26, 2025, the Chair of the Special Committee, along with Barclays and Fasken, met with representatives of Future Pak and the Significant Shareholder to discuss the possible transaction between the Corporation and Future Pak, as well as Future Pak’s future plans for the Corporation.

On June 27, 2025, the Significant Shareholder conveyed to Fasken that it was not going to take a position at such point in time with respect to the Corporation’s possible transaction with Future Pak.

In the afternoon of July 2, 2025, the Special Committee met to review and discuss the proposed Arrangement and to conduct a final review of its material terms and conditions and to receive the advice of Barclays, Raymond James, Fasken and Norton Rose. Each of Barclays and Raymond James presented updates to their respective financial analyses with respect to the Arrangement and rendered their respective oral Fairness Opinions to the Special Committee, each subsequently confirmed in writing, to the effect that, as of that date and based upon and subject to the assumptions, limitations, qualifications and other matters set forth in each applicable written Fairness Opinion, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to such Shareholders. After reviewing the terms of the draft Arrangement Agreement and the related transaction documentation, discussing the presentations by financial and legal advisors and having taken into consideration the Fairness Opinions, the Special Committee discussed and analyzed the benefits and risks associated with the Arrangement, including the factors described under “The Arrangement – Reasons for the Arrangement”. After careful consideration, the Special Committee unanimously determined that the Arrangement Agreement is in the best interests of the Corporation and is fair to the Shareholders. Accordingly, the Special Committee unanimously resolved to recommend that the Board approve the Arrangement and recommend that the Shareholders vote for the Arrangement Resolution.

Later in the afternoon of July 2, 2025, the Board met with Barclays, Raymond James, Fasken and Norton Rose to review the terms of the Arrangement Agreement and the related transaction documentation and to receive the unanimous recommendation of the Special Committee. Among other things, Barclays rendered its oral Fairness Opinion to the Board, subsequently confirmed in writing, to the effect that, as of that date and based upon and subject to the assumptions, limitations, qualifications and other matters set forth in the written Barclays Fairness Opinion, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to such Shareholders. After careful consideration, and after consulting with Barclays, Fasken and Norton Rose, and having taken into account such factors and matters as it considers relevant, including, among other things, the unanimous recommendation of the Special Committee and the factors described under “The Arrangement – Reasons for the Arrangement”, the Board unanimously determined that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders, and unanimously resolved to recommend that Shareholders vote for the Arrangement Resolution.

During the evening of July 2, 2025, the Arrangement Agreement, the Support and Voting Agreements and the related transaction documentation were finalized and executed. A press release announcing the Arrangement was issued later that same evening.

 

3.	Reasons for the Arrangement

In evaluating and approving the Arrangement and in making their determinations and recommendations, each of the Special Committee and the Board considered a number of factors including, among others, the following:

 

•

Thorough Targeted Market Checks. In 2023, amidst efforts by the Corporation (including with Barclays’ support) to find commercial partners to achieve its strategic plan and to secure potential new financing sources, a number of third parties expressed an interest in acquiring the Corporation. As a result, after discussions with its financial and legal advisors, the Board decided to proceed with the First Targeted Market Check, which ran from February 2024 to July 2024 and was ultimately terminated due to unsatisfactory prices being offered. In the second half of 2024, the receipt of certain written and/or verbal indications of interest from third parties led to the formation of the Special Committee and the Market Check Refresh, again with the assistance of Barclays, which did not result in any offers. Following a months-long process with Bidder B that led to an uncompelling final offer, the Corporation ultimately decided to further evaluate the sale of the Corporation by way of an open and non-exclusive Sale Process and to conduct the Second Targeted Market Check, during which 20 potential bidders were contacted and four (4) unsolicited inbound reach outs were received. In connection therewith, the Corporation received two final offers, from each of Future Pak and Bidder C. Therefore, prior to signing the Arrangement Agreement, multiple targeted market checks were conducted involving solicitation of interest from potential bidders identified as potentially having a desire to pursue a transaction involving the Corporation;

 

- 36 -

•

Consideration is a Substantial and Compelling Premium. The cash portion of the consideration offered to the Shareholders and the combined cash and CVR consideration (assuming maximum payment of the CVR) represent premiums of 126% and 216%, respectively, to the closing price on the Nasdaq on April 10, 2025, the date prior to the announcement of Future Pak’s initial non-binding proposal, and of 90% and 165%, respectively, to the 30-day volume weighted average share price for the period ending on April 10, 2025;

 

•

Attractive Transaction Relative to Status Quo. The Special Committee, with the assistance of its financial and legal advisors, and based upon its collective knowledge of the business, affairs, operations, assets, liabilities, financial condition, results of operations and prospects of the Corporation and the current and prospective environment in which the Corporation operates, believes that the Arrangement is an attractive proposition for Shareholders relative to the status quo and is more favourable to the Shareholders than the other strategic alternatives reasonably available to the Corporation, including remaining as an independent public corporation. In particular, the Special Committee’s assessment of the Corporation’s strategic plan, the challenges it would face under the status quo, the substantial capital and resources required to implement the plan, the limited availability and high cost of such capital if the Corporation remained publicly listed, the broad declines in North American equity markets and resulting pressure on the Corporation’s share price, and the difficult macroeconomic environment, led the Special Committee to believe that the Arrangement is in the Corporation’s best interest compared to maintaining the status quo;

 

•

Limited Capacity to Finance Growth via Public Markets. Capital market financings by Nasdaq-listed biopharmaceutical micro-cap companies continue to be challenging with the low trading volume of the Shares being a deterrent to potential new institutional investors and the historically undervalued trading price of the Shares further exacerbates the challenges faced;

 

•

Cash Consideration; Immediate Liquidity. The Cash Consideration to be received by the Shareholders under the terms of the Arrangement Agreement will be paid entirely in cash and provides Shareholders with certainty, immediate value and liquidity for their investment and removes the volatility associated with owning securities of the Corporation as an independent, publicly-traded company, as well as the risks and uncertainties and longer potential timeline for realizing equivalent value from the Corporation’s strategic plan or other possible strategic alternatives;

 

•

Opportunity to Receive Additional Cash Payments under the CVRs. The Consideration includes a CVR tied to the value received through the EGRIFTA and Trogarzo franchises, with a maximum payment of $65 million, which provides Shareholders with an opportunity to receive future cash payments of up to $1.19 per Share;

 

•

Limited Potential Purchasers. In the view of the Special Committee, there are a limited number of potential purchasers with an interest to acquire the Corporation at a price per Share equivalent to the Cash Consideration, in light of the recent Targeted Market Checks performed prior to entering into the Arrangement Agreement and based on the Special Committee’s assessment, including advice from the Corporation’s management, Barclays and Raymond James. Therefore, there may not be another opportunity for Shareholders to receive a value comparable to the Consideration to be received pursuant to the Arrangement Agreement in another transaction in the future;

 

•

Best Possible Terms from Purchaser. Future Pak made its first non-binding proposal regarding a potential acquisition of the Corporation in August 2024 and, since then, four (4) further offers have been made by Future Pak. Following receipt of the Second Future Pak Proposal in January 2025, which instigated discussions between parties, the discussions and arm’s length negotiations with Future Pak took place over a period of two months. The Special Committee concluded, after such extensive negotiations and on the advice of Norton Rose, Fasken, Barclays and Raymond James, that the terms and conditions in the Arrangement Agreement, including in respect of the consideration to be paid to Shareholders pursuant thereto, are the best that could be obtained from Future Pak;

 

•

Terms of the Arrangement Agreement; Appropriateness of Deal Protections. The Special Committee and the Board have determined, after consultation with their legal advisors, that the terms and conditions of the Arrangement Agreement, including the Corporation’s and the Purchaser’s representations, warranties and covenants and the conditions to completion of the Arrangement are reasonable in light of all applicable circumstances, and believes that the limited nature of the conditions to completion of the Arrangement as provided by the Arrangement Agreement, including the absence of a financing condition, mean that the Arrangement is likely to be completed in accordance with its terms and within a short time period. The Termination Fee of $6 million, the Purchaser’s right to match a Superior Proposal and other deal protection measures contained in the Arrangement Agreement are, in the view of the Special Committee and the Board, after receiving advice from their financial and legal advisors, appropriate for a transaction of this nature. In the view of the Special Committee, after receiving advice from its financial and legal advisors, the Termination Fee is reasonable in the context of similar fees that have been negotiated in other transactions of comparable size and nature and should not preclude a third party from making an acquisition proposal;

 

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•

Committed Financing. The Purchaser has provided the Corporation with satisfactory evidence, including the Debt Commitment Letter, that the Purchaser has arranged for committed financing that is not subject to unusual conditions;

 

•

Reverse Termination Fee. The Corporation is entitled to receive the Reverse Termination Fee of $12 million if the Arrangement Agreement is terminated in the event of a breach by the Purchaser in certain circumstances or a failure by the Purchaser to consummate closing in certain circumstances;

 

•

Support and Voting Agreements and Significant Shareholder Support. The Supporting Shareholders, who together owned or exercised control or direction over an aggregate of 524,266 Shares, representing in the aggregate approximately 1.14% of the Corporation’s outstanding Shares as at July 2, 2025, have entered into Support and Voting Agreements with the Purchaser under which they have agreed, among other things, to vote their Shares in favour of the Arrangement Resolution and against any resolution submitted by any other person that is inconsistent with the Arrangement. Further, Soleus, holding 10.4% of the outstanding Shares as at the date hereof, has on multiple occasions expressed to the Board and publicly its belief that an acquisition of the Corporation is in the best interest of the Shareholders and, on July 31, 2025, informed the Board that it is supportive of the Arrangement and intends to vote in favour of the Arrangement absent a material change in circumstances;

 

•

Limited Closing Conditions; Absence of Regulatory Approvals; Accelerated Timeline. The Purchaser’s obligation to complete the Arrangement is subject to a limited number of conditions, which the Special Committee and the Board, after consultation with their legal advisors, believes are reasonable under the circumstances and the closing of the Arrangement is not subject to any regulatory approvals. The Special Committee and the Board believe that the Arrangement is likely to be completed in accordance with its terms and within a short period of time following the receipt of required Shareholder and Court approvals; and

 

•

Treatment of Holders of Incentive Securities. The advantageous treatment of and consideration to be received by holders of Incentive Securities.

In making their unanimous determinations and recommendations, each of the Special Committee and the Board also observed that a number of procedural safeguards were, and are, present to allow the Special Committee and the Board to effectively represent the interests of the Corporation, including, among others:

 

•

Arm’s Length Negotiations and Special Committee Oversight. The Arrangement Agreement is the result of an extensive and robust arm’s-length negotiation process with the oversight and participation of the Special Committee, which is comprised solely of independent directors who have no financial interest in the Arrangement that is different from that of the Shareholders, and with the advice of experienced and qualified financial and legal advisors;

 

•

Independent Fairness Opinion. Raymond James, as independent financial advisor to the Special Committee, provided an independent fairness opinion to the Board and the Special Committee to the effect that, as at July 2, 2025, based upon and subject to the limitations, qualifications, assumptions and other matters set forth therein, the Consideration to be received by Shareholders under the Arrangement is fair, from a financial point of view, to such Shareholders. In connection with such independent fairness opinion, Raymond James will receive a fixed fee that is not dependent on the completion of the Arrangement or the conclusions it reached;

 

•

Financial Advisor’s Fairness Opinion. Barclays provided the Special Committee and the Board with a fairness opinion to the effect that, as at July 2, 2025, based upon and subject to the limitations, qualifications, assumptions and other matters set forth therein, the Consideration to be received by Shareholders under the Arrangement is fair, from a financial point of view, to such Shareholders;

 

•

Fiduciary Out; Ability to Respond to Unsolicited Superior Proposals. Under the Arrangement Agreement, the Board retains the ability, notwithstanding the non-solicitation provisions of the Arrangement Agreement, to consider and respond to unsolicited Superior Proposals prior to the approval of the Arrangement Resolution by the Shareholders on the specific terms and conditions set forth in the Arrangement Agreement, including the payment of the Termination Fee if the Arrangement Agreement is terminated as a result of the Corporation entering into a definitive agreement with respect to a Superior Proposal. In the view of the Special Committee and the Board, after receiving legal and financial advice, the Termination Fee is reasonable in the circumstances and would not preclude a third party from potentially making a Superior Proposal. Further, the Support and Voting Agreements automatically terminate in the event that the Arrangement Agreement is terminated in accordance with its terms, permitting the Supporting Shareholders to support a transaction involving a Superior Proposal;

 

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•

Required Shareholder Approval. The Arrangement will become effective only if it is approved by an affirmative vote of at least (i) 662⁄3% of the votes cast by Shareholders and (ii) at least a majority of the votes cast by Shareholders, excluding the votes attached to Shares beneficially owned, or over which control or direction is exercised, by Shareholders required to be excluded pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions, in each case, by Shareholders present in person or represented by proxy at the Meeting;

 

•

Required Court Approval. The Arrangement is subject to a determination of the Court that the Arrangement is fair and reasonable;

 

•

Dissent Rights. Registered Shareholders who oppose the Arrangement may, upon compliance with certain conditions, exercise Dissent Rights and, if validly exercised, receive the fair value of their Shares;

 

•

Appropriate Inducements. The Termination Fee and the Purchaser’s right to match are appropriate inducements to the Purchaser to enter into the Arrangement Agreement; and

 

•

Fairness for Stakeholders. In the Special Committee’s view, the terms of the Arrangement Agreement treat stakeholders of the Corporation fairly in light of all relevant facts and circumstances.

In making their determinations and recommendations, the Special Committee and the Board also considered a variety of uncertainties, risks and other potentially negative factors relating to the Arrangement, including those described below:

 

•

Risk of Non-Completion. There are risks to the Corporation if the Arrangement is not completed in a timely manner or at all, including the costs to the Corporation in pursuing the Arrangement (a significant portion of which will be incurred regardless of whether the Arrangement is consummated), the potential diversion of management’s attention away from conducting the Corporation’s day-to-day business in the ordinary course and the potential impact on the Corporation’s current business relationships, including with future and prospective employees, customers, suppliers and partners;

 

•

Ability to Achieve an Alternative Transaction. If the Arrangement Agreement is terminated, there is no assurance that the Corporation will be able to find an alternative transaction with a party willing to pay greater or equivalent value compared to the Consideration or that the continued operation of the Corporation under its current business model would yield equivalent or greater value compared to that available under the Arrangement;

 

•

Closing Conditions and Approvals. The completion of the Arrangement is subject to certain conditions that must be satisfied or waived, certain of which are outside the control of the Corporation, including the receipt of the Required Shareholder Approval. There is no certainty that the Required Shareholder Approval will be obtained or that the other closing conditions will be satisfied or waived in a timely manner or at all. In addition, the Purchaser has the right to terminate the Arrangement Agreement in certain circumstances, including generally if conditions are not met by the Outside Date;

 

•

Consummation of the Purchaser’s Financing. The conditions set forth in the Debt Commitment Letter may not be satisfied on a timely basis or at all, which risk is partially mitigated by the Reverse Termination Fee, or other events may arise which would prevent the Purchaser from consummating the Arrangement;

 

•

Restrictions on Operations. The restrictions on the conduct of the Corporation’s business imposed pursuant to the Arrangement Agreement, requiring the Corporation to conduct its business in the ordinary course, subject to certain exceptions, during the period between the execution of the Arrangement Agreement and the consummation of the Arrangement or the termination of the Arrangement Agreement, may delay or prevent the Corporation from undertaking business opportunities that may arise pending completion of the Arrangement;

 

•

No Continuing Interest of Shareholders. If the Arrangement is successfully completed, the Corporation will no longer exist as an independent public corporation, the Shares will be delisted from the TSX and the Nasdaq and the consummation of the Arrangement will eliminate the opportunity for Shareholders to participate in potential longer- term benefits of the business of the Corporation that might result from future growth and the potential achievement of the Corporation’s long-term plans to the extent that those benefits, if any, exceed the benefits reflected in the Consideration received by Shareholders pursuant to the Arrangement and with the understanding that there is no assurance that any such long-term benefits will in fact materialize;

 

•

Taxable Transaction. The Arrangement will be a taxable transaction and, as a result, Shareholders will generally be required to pay taxes on any gains that result from their receipt of the Consideration pursuant to the Arrangement;

 

•

Newly-Formed Purchaser. The Purchaser is a newly formed entity with no assets other than its rights under the Debt Commitment Letter; and

 

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•

Superior Proposals. The limitations on the Corporation’s ability to solicit additional interest from third parties and the Purchaser’s right contained in the Arrangement Agreement to match a Superior Proposal, under certain conditions, may discourage other parties from making a Superior Proposal.

The foregoing summary of the information and factors considered by the Special Committee and the Board is not intended to be exhaustive but includes the material information, factors and analysis considered by the Special Committee and the Board in making their respective determinations and recommendations with respect to the Arrangement. The members of the Special Committee and the directors of the Corporation evaluated the various factors summarized above in light of their own knowledge of the Corporation and the industry in which it operates and of the Corporation’s business, financial condition and prospects, and were assisted in this regard by management and financial advisors and outside legal counsel. Neither the Special Committee nor the Board considered it practicable to, and did not, quantify or otherwise attempt to assign specific weights to the factors considered in reaching their determinations and recommendations. Neither the Special Committee nor the Board reached any specific conclusion with respect to any of the factors or reasons considered, and the above factors are not presented in any order of priority. The foregoing discussion includes forward-looking information and readers are cautioned that actual results may vary. See “Forward-Looking Statements”.

 

4.	Recommendation of the Special Committee and the Board

Having undertaken a thorough review of, and carefully considered the terms of the Arrangement and the Arrangement Agreement and a number of other factors, including, without limitation, those listed under “The Arrangement – Reasons for the Arrangement”, and after consulting with outside legal and financial advisors, the Special Committee has unanimously determined that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders. Accordingly, the Special Committee has unanimously recommended that the Board approve the Arrangement and that the Board recommend that Shareholders vote in favour of the Arrangement Resolution.

After careful consideration, and after consulting with outside legal and financial advisors and having taken into account such factors and matters as it considered relevant, including, without limitation, those listed under “The Arrangement – Reasons for the Arrangement”, as well as the Special Committee’s unanimous recommendation, the Board has unanimously determined that the Arrangement is in the best interests of the Corporation and is fair to the Shareholders. Accordingly, the Board has unanimously approved the Arrangement and recommends that Shareholders vote in favour of the Arrangement Resolution.

 

5.	Fairness Opinions

In deciding to approve the Arrangement and recommend that Shareholders vote in favour of the Arrangement Resolution, the Special Committee and the Board considered, among other things, the Fairness Opinions. The Fairness Opinions each state that, as at July 2, 2025, and based upon and subject to the assumptions, limitations, qualifications and other matters respectively set forth in therein, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to such Shareholders.

The Fairness Opinions were one of many factors considered by the Special Committee and the Board in evaluating the Arrangement and should not be viewed as determinative of the views of the Special Committee or the Board with respect to the Arrangement or the Consideration to be received by Shareholders under the Arrangement.

The following summaries of the Fairness Opinions are qualified in their entirety by reference to the full texts of the applicable Fairness Opinion attached to this Circular as Appendix G and Appendix H, respectively. You are encouraged to read the Fairness Opinions in their entirety. The Fairness Opinions are not recommendations as to how any Shareholder should vote with respect to the Arrangement or any other matter.

Barclays Fairness Opinion

The Corporation engaged Barclays to act as its financial advisor with respect to pursuing strategic alternatives for the Corporation, including a possible sale of the Corporation, pursuant to an engagement letter dated November 10, 2023 and the subsequent reinstatement of such engagement letter on November 21, 2024. On July 2, 2025, Barclays rendered its oral opinion (which was subsequently confirmed in writing) to the Board and the Special Committee that, as of such date and based upon and subject to the qualifications, limitations and assumptions stated in the Barclays Fairness Opinion, the Consideration to be received by the Shareholders is fair, from a financial point of view, to such Shareholders.

 

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The full text of the Barclays Fairness Opinion, dated as of July 2, 2025, is attached as Appendix G to this Circular. The Barclays Fairness Opinion sets forth, among other things, the assumptions made, procedures followed, factors considered and limitations upon the review undertaken by Barclays in rendering the Barclays Fairness Opinion. You are encouraged to read the Barclays Fairness Opinion carefully in its entirety. The following is a summary of the Barclays Fairness Opinion and the methodology that Barclays used to render the Barclays Fairness Opinion. This summary is qualified in its entirety by reference to the full text of the Barclays Fairness Opinion.

The Barclays Fairness Opinion, the issuance of which was approved by Barclays’ Valuation and Fairness Opinion Committee, is addressed to the Board and the Special Committee, addresses only the fairness, from a financial point of view, of the Consideration to be received by the Shareholders (other than any Dissenting Shareholders who have validly exercised their respective Dissent Rights) and does not constitute a recommendation to any Shareholder as to how such Shareholder should vote with respect to the Arrangement or any other matter. The terms of the Arrangement were determined through arm’s-length negotiations between the Corporation and Future Pak, and were unanimously approved by the Board. Barclays did not recommend any specific form of Consideration to the Shareholders or that any specific form of consideration constituted the only appropriate consideration for the Arrangement. Barclays was not requested to address, and the Barclays Fairness Opinion does not in any manner address, the Corporation’s underlying business decision to proceed with or effect the Arrangement, the likelihood of the consummation of the Arrangement, or the relative merits of the Arrangement as compared to any other transaction in which the Corporation may engage. In addition, Barclays expressed no opinion on, and the Barclays Fairness Opinion does not in any manner address, the fairness of the amount or the nature of any compensation to any officers, directors or employees of any parties to the Arrangement, or any class of such Persons, relative to the Consideration to be received by the Shareholders in the Arrangement. No limitations were imposed by the Board or the Special Committee upon Barclays with respect to the investigations made or procedures followed by it in rendering the Barclays Fairness Opinion.

In arriving at the Barclays Fairness Opinion, Barclays, among other things:

 

•

reviewed and analyzed drafts of the Arrangement Agreement and Plan of Arrangement, each dated as of July 2, 2025, and the specific terms of the Arrangement;

 

•

reviewed and analyzed a draft of the CVR Agreement, dated as of July 2, 2025;

 

•

reviewed and analyzed publicly available information concerning the Corporation that Barclays believed to be relevant to its analysis, including the Corporation’s Annual Report on Form 20-F for the fiscal year ended November 30, 2024 and certain interim reports of the Corporation on Form 6-K;

 

•

reviewed and analyzed financial and operating information with respect to the business, operations and prospects of the Corporation furnished to Barclays by the Corporation, including financial projections of the Corporation prepared by the Corporation’s management;

 

•

reviewed and analyzed a trading history of the Shares from April 2024 through July 2025 and a comparison of such trading history with those of other companies that Barclays deemed relevant;

 

•

reviewed and analyzed a comparison of the historical financial results and present financial condition of the Corporation with those of other companies that Barclays deemed relevant;

 

•

reviewed and analyzed a comparison of the financial terms of the Arrangement with the financial terms of certain other transactions that Barclays deemed relevant;

 

•

reviewed and analyzed published estimates of independent research analysts with respect to the future financial performance and price targets of the Corporation;

 

•

reviewed and analyzed the results of Barclays’ efforts to solicit indications of interest from third parties with respect to a sale of all or part of the Corporation;

 

•

had discussions with the management of the Corporation concerning its business, operations, assets, liabilities, financial condition and prospects; and

 

•

has undertaken such other studies, analyses and investigations as Barclays deemed appropriate.

 

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In arriving at the Barclays Fairness Opinion, Barclays assumed and relied upon the accuracy and completeness of the financial and other information used by Barclays without any independent verification of such information (and had not assumed responsibility or liability for any independent verification of such information). Barclays also relied upon the assurances of the management of the Corporation that they were not aware of any facts or circumstances that would make such information inaccurate or misleading. With respect to the financial projections of the Corporation, upon the advice of the Corporation, Barclays assumed that such projections were reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of the Corporation as to the Corporation’s future financial performance and that the Corporation would perform in accordance with such projections. In arriving at the Barclays Fairness Opinion, Barclays relied upon the Corporation’s management’s assessments and projections as to the probability and estimated timing of achievement of the CVR Milestones triggering the Milestone Payments, which were provided to or discussed with Barclays by the management of the Corporation. In arriving at the Barclays Fairness Opinion, Barclays assumed no responsibility for and expressed no view as to any such projections or estimates or the assumptions on which they were based. In arriving at the Barclays Fairness Opinion, Barclays did not conduct a physical inspection of the properties and facilities of the Corporation and did not make or obtain any evaluations or appraisals of the assets or liabilities of the Corporation. The Barclays Fairness Opinion was necessarily based upon market, economic and other conditions as they existed on, and could be evaluated as of, July 2, 2025. Barclays assumed no responsibility for updating or revising the Barclays Fairness Opinion based on events or circumstances that may have occurred after, July 2, 2025. In addition, Barclays expressed no opinion as to the CVR Agreement, including without limitation the structure or form of the CVR (with respect to transferability, illiquidity, or otherwise), or whether and when any amount payable thereunder will be paid.

Barclays assumed that the executed Arrangement Agreement, the Plan of Arrangement and the CVR Agreement would conform in all material respects to the last drafts of each agreement reviewed by Barclays. In addition, Barclays assumed the accuracy of the representations and warranties contained in the Arrangement Agreement and all agreements related thereto, including the Plan of Arrangement and the CVR Agreement. Barclays also assumed, upon the advice of the Corporation, that all material governmental, regulatory and third party approvals, consents and releases for the Arrangement would be obtained within the constraints contemplated by the Arrangement Agreement and Plan of Arrangement and that the Arrangement will be consummated in accordance with the terms of the Arrangement Agreement, the Plan of Arrangement and the CVR Agreement without waiver, modification or amendment of any material term, condition or agreement thereof. Barclays did not express any opinion as to any tax or other consequences that might result from the Arrangement, nor did the Barclays Fairness Opinion addresses any legal, tax, regulatory or accounting matters, as to which Barclays understood the Corporation had obtained such advice as it deemed necessary from qualified professionals.

In connection with rendering the Barclays Fairness Opinion, Barclays performed certain financial, comparative and other analyses as summarized below. In arriving at the Barclays Fairness Opinion, Barclays did not ascribe a specific range of values to the Shares but rather made its determination as to fairness, from a financial point of view, to the Shareholders of the Consideration to be received by such Shareholders in the Arrangement on the basis of various financial and comparative analyses. The preparation of the Barclays Fairness Opinion is a complex process and involves various determinations as to the most appropriate and relevant methods of financial and comparative analyses and the application of those methods to the particular circumstances. Therefore, the Barclays Fairness Opinion is not readily susceptible to summary description.

In arriving at the Barclays Fairness Opinion, Barclays did not attribute any particular weight to any single analysis or factor considered by it but rather made qualitative judgments as to the significance and relevance of each analysis and factor relative to all other analyses and factors performed and considered by it and in the context of the circumstances of the particular transaction. Accordingly, Barclays believes that its analyses must be considered as a whole, as considering any portion of such analyses and factors, without considering all analyses and factors as a whole, could create a misleading or incomplete view of the process underlying the Barclays Fairness Opinion.

Summary of Material Financial Analyses

The following is a summary of the material financial analyses used by Barclays in preparing the Barclays Fairness Opinion. The summary of Barclays’ analyses and reviews provided below is not a complete description of the analyses and reviews underlying the Barclays Fairness Opinion. The preparation of the Barclays Fairness Opinion is a complex process involving various determinations as to the most appropriate and relevant methods of analysis and review and the application of those methods to particular circumstances, and, therefore, is not readily susceptible to summary description.

 

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For the purposes of its analyses and reviews, Barclays made numerous assumptions with respect to industry performance, general business, economic, market and financial conditions and other matters, many of which are beyond the control of the Corporation, Future Pak, Barclays or any other parties to the Arrangement. No company, business or transaction considered in Barclays’ analyses and reviews is identical to the Corporation or Future Pak or the Arrangement, and an evaluation of the results of those analyses and reviews is not entirely mathematical. Rather, the analyses and reviews involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the acquisition, public trading or other values of the companies, businesses or transactions considered in Barclays’ analyses and reviews. None of the Corporation, Future Pak, Barclays or any other person assumes responsibility if future results are materially different from those discussed. Any estimates contained in these analyses and reviews and the ranges of valuations resulting from any particular analysis or review are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than as set forth below. In addition, analyses relating to the value of companies, businesses or securities do not purport to be appraisals or reflect the prices at which the companies, businesses or securities may actually be sold. Accordingly, the estimates used in, and the results derived from, Barclays’ analyses and reviews are inherently subject to substantial uncertainty.

The summary of the financial analyses and reviews provided below includes information presented in tabular format. In order to fully understand the financial analyses and reviews used by Barclays, the tables must be read together with the text of each summary, as the tables alone do not constitute a complete description of the financial analyses and reviews. Considering the data in the tables below without considering the full description of the analyses and reviews, including the methodologies and assumptions underlying the analyses and reviews, could create a misleading or incomplete view of Barclays’ analyses and reviews.

For purposes of its analyses and reviews, Barclays considered both the Cash Consideration payable at closing pursuant to the Arrangement Agreement as well as an estimate of the net present value of the total consideration as of May 31, 2025, taking into account the Corporation’s management’s estimates of the likelihood of achieving the CVR Milestones set forth in the CVR Agreement and applying a discount rate of 12.25% (the midpoint of the discount rate range of 10.5% to 14.0% determined by Barclays), reflecting estimates of the Corporation’s weighted average cost of capital, to calculate an implied net present value per Share (the “Implied NPV Consideration”).

Selected Comparable Company Analysis

In order to assess how the public market values shares of similar publicly traded companies and to provide a range of relative implied equity values per Share by reference to those companies, which could then be used to calculate implied ranges, Barclays reviewed and compared specific financial and operating data relating to the Corporation with selected companies that Barclays, based on its experience in the biopharmaceutical industry, deemed comparable to the Corporation. The selected comparable companies with respect to the Corporation were (the “Selected Comparable Companies”):

 

•

Xeris Biopharma Holdings, Inc.

 

•

Pharming Group NV

 

•

Rigel Pharmaceuticals, Inc.

 

•

Heron Therapeutics Inc.

 

•

Puma Biotechnology, Inc.

 

•

Medexus Pharmaceuticals Inc.

Barclays calculated and compared various financial multiples and ratios of the Corporation and the Selected Comparable Companies (the “Selected Comparable Company Analysis”). As part of its Selected Comparable Company Analysis, Barclays calculated and analyzed each company’s ratio of its enterprise value to its 2025 estimated revenue. The enterprise value of each

 

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company was obtained by adding its short and long-term debt to the sum of the market value of its common equity and the book value of any minority interest, and subtracting its cash and cash equivalents. All of these calculations were performed, and based on publicly available financial data and closing prices, as of July 1, 2025, the last trading date prior to the delivery of the Barclays Fairness Opinion. The results of this Selected Comparable Company Analysis are summarized below:

 

Metric

25th Percentile

Median

Mean

75th Percentile

Enterprise Value / 2025E Revenue

1.0x

2.0x

2.0x

2.8x

Barclays selected the Selected Comparable Companies because their businesses and operating profiles were considered by Barclays to be reasonably similar to that of the Corporation. However, because no Selected Comparable Company is exactly the same as the Corporation, Barclays believed that it was inappropriate to, and therefore did not, rely solely on the quantitative results of the Selected Comparable Company Analysis. Accordingly, Barclays also made qualitative judgments concerning differences between the business, financial and operating characteristics and prospects of the Corporation and the Selected Comparable Companies that could affect the public trading values of each in order to provide a context in which to consider the results of the quantitative analysis. These qualitative judgments related primarily to the differing sizes, growth prospects, profitability levels and degree of operational risk between the Corporation and the Selected Comparable Companies. Based upon these judgments, Barclays selected a range of enterprise value multiples of 1.0x to 2.8x of 2025 estimated revenues and applied such range to the management projections to calculate ranges of implied prices per Share.

Barclays noted that on the basis of the Selected Comparable Company Analysis, the Cash Consideration per Share was within the range of implied values per Share and the Implied NPV Consideration per Share was above the range of implied values per Share calculated in the Selected Comparable Company Analysis.

Discounted Cash Flow Analysis

In order to estimate the present value of the Shares, Barclays performed a discounted cash flow analysis (“DCF Analysis”) of the Corporation. A DCF Analysis is a traditional valuation methodology used to derive a valuation of an asset by calculating the “present value” of estimated future cash flows of the asset. “Present value” refers to the current value of future cash flows or amounts and is obtained by discounting those future cash flows or amounts by a discount rate that takes into account macroeconomic assumptions and estimates of risk, the opportunity cost of capital, expected returns and other appropriate factors.

To calculate the estimated enterprise value of the Corporation using the DCF Analysis, Barclays added (i) the Corporation’s projected after-tax unlevered free cash flows for the second half of fiscal year 2025 and fiscal years 2026 through 2036 based on management projections to (ii) the “terminal value” of the Corporation as of the end of the Corporation’s fiscal year 2036, and discounted such amount to its present value using a range of selected discount rates. The after-tax unlevered free cash flows were calculated by taking the tax-affected earnings before interest, tax expense and amortization (excluding amortization of purchased intangibles) and subtracting capital expenditures, adding depreciation and adjusting for changes in working capital. The “terminal value” refers to the residual value of the Corporation at the end of the forecast period and was estimated by discounting the after-tax unlevered free cash flows for the Corporation’s fiscal year 2036 to present value using a range of selected discount rates and an estimated perpetuity growth rate of -40%. The range of after-tax discount rates of 10.5% to 14.0% was selected based on an analysis of the weighted average cost of capital of the Corporation and the comparable companies. Barclays then calculated a range of implied prices per Share by subtracting estimated net debt as of May 31, 2025, as provided by the Corporation management, from the estimated enterprise value using the discounted cash flow method and dividing such amount by the fully diluted number of Shares calculated on a treasury stock method basis (taking into account outstanding in-the-money Options, Exchangeable Subscription Receipts, DSUs, SARs and Warrants, if applicable) as of May 31, 2025.

Barclays noted that on the basis of the DCF Analysis, the Cash Consideration per Share was within the range of implied values per Share, and the Implied NPV Consideration per Share was above the range of implied values per Share calculated in the analysis above.

 

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Selected Precedent Transaction Analysis

Barclays reviewed and compared the purchase prices and financial multiples paid in selected other transactions that Barclays, based on its experience with merger and acquisition transactions in the biopharmaceutical industry, deemed relevant (the “Precedent Transactions Analysis”). Barclays chose such transactions based on, among other things, the similarity of the applicable target companies in the transactions to the Corporation with respect to the size, mix, margins and other characteristics of their businesses.

As part of its selected precedent transaction analysis, for each of the selected transactions, based on information Barclays obtained from company filings and broker research, Barclays analyzed the enterprise value of each target company at the time of announcement of the respective transactions as compared to their projected revenues for the following fiscal year (or their current fiscal year if the announcement of the transaction occurred less than halfway through the applicable fiscal year).

The reasons for and the circumstances surrounding each of the selected precedent transactions analyzed were diverse and there are inherent differences in the business, operations, financial conditions and prospects of the Corporation and the companies included in the selected precedent transaction analysis. Accordingly, Barclays believed that a purely quantitative selected precedent transaction analysis would not be particularly meaningful in the context of considering the proposed transaction. Barclays therefore made qualitative judgments concerning differences between the characteristics of the selected precedent transactions and the proposed transaction which would affect the acquisition values of the selected target companies and the Corporation. Based upon these judgments, Barclays selected a range of enterprise value multiples implied by the prices paid (excluding contingent consideration) of 1.5x to 3.0x of 2025 estimated revenues and applied such range to the management projections. The following table sets forth the transactions analyzed based on such characteristics and the results of such analysis:

 

Date Announced		Target		Acquiror		Transaction Value / 1Y Forward Revenue
March 19, 2025		OptiNose, Inc.		Paratek Pharmaceuticals, Inc.		2.5x
February 20, 2025		Mayne Pharma Group Ltd.		Cosette Pharmaceuticals, Inc.		1.5x
June 24, 2024		Alimera Sciences, Inc.		ANI Pharmaceuticals, Inc.		3.5x
June 6, 2023		Paratek Pharmaceuticals, Inc.		Gurnet Point Capital LLC / Novo Holdings A/S		1.5x
July 11, 2022		La Jolla Pharmaceutical Company		Innoviva, Inc.		2.1x
February 14, 2022		BioDelivery Sciences International, Inc.		Collegium Pharmaceutical, Inc.		3.2x
October 11, 2021		Adamas Pharmaceuticals, Inc.		Supernus Pharmaceuticals, Inc.		4.2x
June 25, 2021		Osmotica Pharmaceuticals plc		Alora Pharmaceuticals, LLC		1.3x
March 16, 2020		Correvio Pharma Corp.		Advanz Pharma Corp. Limited		1.7x
January 18, 2019		Spectrum Pharmaceuticals, Inc.		Acrotech Biopharma		1.5x
		25th percentile		1.5x		1.8x
		Median		1.9x		2.4x
		Mean		2.3x		2.7x
		75th percentile		3.0x		3.4x

 

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Barclays noted that on the basis of the Precedent Transactions Analysis, the Cash Consideration per Share and the Implied NPV Consideration per Share were each within the range of implied values per Share, calculated using the projections of the Corporation’s management.

Other Factors

Barclays also reviewed and considered other factors, which were not considered part of its financial analyses in connection with rendering its advice, but were references for informational purposes, including, among other things, the historical share price analysis, transaction premium analysis and analyst price target analysis, each described below.

Transaction Premium Analysis

In order to assess the premium to be received by the Shareholders in the Arrangement relative to the premiums offered to shareholders in other transactions, Barclays reviewed the premium paid in select biopharmaceutical transactions valued between $50 million and $250 million in the 10-year period ending July 1, 2025 (the “Transaction Premium Analysis”). For each transaction, Barclays calculated the premium per share paid by the acquirer by comparing the announced transaction value per share to the target company’s share price on the last unaffected date prior to the announcement of such transaction. These selected transactions yielded a premium range of 22% to 168%.

The reasons for and the circumstances surrounding each of the transactions analyzed in the transaction premium analysis were diverse and there are inherent differences in the business, operations, financial conditions and prospects of the Corporation and the companies included in the transaction premium analysis. Accordingly, Barclays believed that a purely quantitative transaction premium analysis would not be particularly meaningful in the context of considering the proposed transaction. Barclays therefore made qualitative judgments concerning the differences between the characteristics of the selected transactions and the proposed transaction which would affect the acquisition values of the target companies and the Corporation. Based upon these judgments, Barclays selected a range to the closing price of the Share on April 10, 2025 (the last trading day prior to the public announcement of Future Pak’s acquisition proposal for the Corporation) to calculate a range of implied prices per Share.

Barclays noted that on the basis of the Transaction Premium Analysis, the Cash Consideration per Share was within the range of implied values per Share, and the Implied NPV Consideration per Share was above the range of implied values per Share, in each case, calculated using the closing price of the Shares on the Nasdaq on April 10, 2025.

Historical Share Price Analysis

To illustrate the trend in the historical trading prices of the Shares, Barclays considered historical data with regard to the trading prices of the Shares for the 12-month period ended April 10, 2025 (the last trading day prior to the public announcement of Future Pak’s acquisition proposal for the Corporation). Barclays noted that during the 12-month period ended April 10, 2025, the closing price of the Shares on the Nasdaq ranged from $1.15 to $2.05.

Equity Research Target Prices Analysis

Barclays reviewed the price target for the Shares published by three research analysts covering the Corporation, as of a range of dates between February 26, 2025 and April 14, 2025 (after the public announcement of Future Pak’s acquisition proposal for the Corporation). The publicly available per share price targets published by such research analysts do not necessarily reflect current market trading prices for the Shares and such estimates are subject to uncertainties, including future financial performance of the Corporation and future market conditions.

General

Barclays is an internationally recognized investment banking firm and, as part of its investment banking activities, is regularly engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, investments for passive and control purposes, negotiated underwritings, competitive bids, secondary distributions of listed and unlisted securities, private placements and valuations for estate, corporate and other purposes. The Board selected Barclays because of its familiarity with the Corporation and its qualifications, reputation and experience in the valuation of businesses and securities in connection with mergers and acquisitions generally, as well as substantial experience in transactions comparable to the proposed transaction.

 

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Barclays is acting as financial advisor to the Corporation in connection with the Arrangement. As compensation for its services in connection with the Arrangement, the Corporation paid Barclays a fee upon the delivery of the Barclays Fairness Opinion which is referred to as the “Opinion Fee”. The Opinion Fee was not contingent upon the conclusion of the Barclays Fairness Opinion or the consummation of the Arrangement. Additional compensation will be payable on completion of the Arrangement against which the Opinion Fee will be credited. In addition, the Corporation has agreed to reimburse Barclays for a portion of its reasonable out-of-pocket expenses incurred in connection with the Arrangement and to indemnify Barclays for certain liabilities that may arise out of its engagement by the Corporation and the rendering of the Barclays Fairness Opinion. In the past two years, Barclays has not received fees from either the Corporation, the Purchaser or Future Pak for any investment banking services.

Barclays and its affiliates engage in a wide range of businesses from investment and commercial banking, lending, asset management and other financial and non-financial services. In the ordinary course of its business, Barclays and affiliates may actively trade and effect transactions in the equity, debt and/or other securities (and any derivatives thereof) and financial instruments (including loans and other obligations) of the Corporation and Future Pak and certain of their respective affiliates for its own account and for the accounts of its customers and, accordingly, may at any time hold long or short positions and investments in such securities and financial instruments.

Raymond James Fairness Opinion

Pursuant to an engagement letter between the Corporation and Raymond James dated March 28, 2025 (the “Raymond James Engagement Letter”), Raymond James was retained by the Corporation to act as an independent financial advisor to the Special Committee, including to advise and assist the Special Committee in considering all strategic alternatives available to the Corporation as part of a strategic review process and to provide an opinion to the Special Committee as to the fairness, from a financial point of view, of the Consideration to be received by the Shareholders pursuant the Arrangement. Under the terms of the Raymond James Engagement Letter, Raymond James will receive a fixed fee from the Corporation for its advisory services and a fee payable on delivery of the Raymond James Fairness Opinion, which is not contingent, in whole or in part, upon the conclusions reached in the Raymond James Fairness Opinion or the outcome of the Arrangement. The Corporation has also agreed to reimburse Raymond James for all reasonable legal and out-of-pocket expenses and to indemnify Raymond James against certain potential liabilities arising out of its engagement.

At the meetings of the Special Committee and the Board each held on July 2, 2025 to consider the Arrangement, Raymond James orally delivered the Raymond James Fairness Opinion to the Special Committee and the Board, which was subsequently confirmed in writing in a written opinion dated July 2, 2025. The Raymond James Fairness Opinion concluded that, as of July 2, 2025, and based upon and subject to the assumptions, limitations, qualifications and other matters set forth in the written Raymond James Fairness Opinion as well as such other information, analyses and discussions as Raymond James considered necessary or appropriate in the circumstances, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to such Shareholders.

The full text of the Raymond James Fairness Opinion which states, among other things, the credentials of Raymond James, the assumptions made, information reviewed, matters considered and limitations on the scope of the review undertaken, is attached as Appendix H to this Circular and incorporated by reference in its entirety into this Circular. Shareholders are urged to read the Raymond James Fairness Opinion carefully and in its entirety. The summary of the Raymond James Fairness Opinion described in this Circular is qualified in its entirety by reference to the full text of the Raymond James Fairness Opinion.

The Raymond James Fairness Opinion was provided to the Special Committee and the Board for their exclusive use only in considering the Arrangement and does not address any other aspects of the Arrangement and does not constitute and should not be construed as a recommendation to the Special Committee or the Board as to any decision with respect to the Arrangement or as to how any Shareholder should vote or act on any matter relating to the Arrangement, nor as an opinion concerning the trading price or value of any securities of the Corporation at any time, including following the announcement, completion or termination of the Arrangement. The Raymond James Fairness Opinion may not be published, disclosed to any other person, relied upon or used by any other person, or used for any other purpose, without the express prior written consent of Raymond James, which consent has been obtained for the purposes of its inclusion in this Circular. The Raymond James Fairness Opinion does not

 

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address the relative merits of the Arrangement as compared to other transactions or business strategies that might be available to the Corporation or the Corporation’s underlying business decision to implement the Arrangement. Raymond James has not been asked to prepare, nor has it prepared, a formal valuation or appraisal of the Corporation or any of its securities or assets, and the Raymond James Fairness Opinion should not be construed as such.

Neither of Raymond James nor any of its affiliates or associates is an “associated entity”, an “affiliate entity” or an “issuer insider” (as such terms are defined in Multilateral Instrument 61-101) of the Interested Parties. Neither Raymond James nor any of its affiliates has been engaged to provide financial advisory services, nor participated in any financing involving the Interested Parties within the 24 months prior to the date of the Raymond James Fairness Opinion, other than services provided under the Raymond James Engagement Letter and as described herein and in the Raymond James Fairness Opinion. There are no other understandings, agreements, or commitments between Raymond James and any of the Interested Parties with respect to any current or future business dealings which are or would be material to Raymond James.

Raymond James may, in the ordinary course of its business, provide financial advisory or investment banking services to the Interested Parties or their respective affiliates or associates from time to time. In addition, in the ordinary course of its business, Raymond James acts as a trader and dealer, both as principal and agent, in major financial markets and, as such, may have, today or in the future, positions in the securities of the Interested Parties or their respective affiliates or associates, and, from time to time, may have executed or may execute transactions on behalf of the Interested Parties or other clients for which it received or may receive compensation. In addition, as an investment dealer, Raymond James conducts research on securities, and may, in the ordinary course of its business, provide research reports and investment advice to its clients on investment matters, including with respect to the Interested Parties or their respective affiliates or associates.

The Raymond James Fairness Opinion represents the opinion of Raymond James and its form and content have been approved for release by a committee of managing directors of Raymond James, each of whom is experienced in providing valuations and fairness opinions for mergers and acquisitions as well as providing capital markets advice.

In connection with rendering the Raymond James Fairness Opinion, Raymond James has reviewed and relied without independent verification upon, among other things, the following:

 

i.	Proposals submitted to the Corporation, including the non-binding indications of interest submitted by the Purchaser dated May 22, 2025 and May 25, 2025, along with their supporting documents;

 

ii.	A draft of the Arrangement Agreement, including the Plan of Arrangement, dated June 23, 2025 and the schedules attached thereto (together with disclosure letters relating thereto);

 

iii.	A draft of the form of the Contingent Value Rights Agreement dated June 23, 2025;

 

iv.	The Corporation’s consolidated annual financial statements, and management of the Corporation’s management discussion and analysis for the years ended November 30, 2024, 2023, and 2022 together with notes thereto, and the auditor’s report thereon;

 

v.

The Corporation’s interim consolidated unaudited financial statements, and the Corporation’s management discussion and analysis for the three-month periods ended February 28, 2025, August 31, 2024, May 31, 2024, February 29, 2024, August 31, 2023, May 31, 2023, February 28, 2023, August 31, 2022, May 31, 2022, and February 28, 2022;

 

vi.	Certain public disclosure by the Corporation as filed on SEDAR + and EDGAR, as at July 2, 2025, including press releases issued by the Corporation;

 

vii.	Certain public investor presentations and marketing materials prepared by the Corporation;

 

viii.

Certain internal financial, operational, corporate and other information with respect to the Corporation, including financial models prepared by the Corporation’s management, as well as internal operating and financial projections prepared or reviewed by the Corporation’s management (and discussions with the Corporation’s management with respect to such information, model, projections and presentations);

 

ix.	Various verbal and written conversations with the Corporation’s management with regards to the operations, financial condition and corporate strategy of the Corporation;

 

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x.	A financial model received from the Corporation (the “Corporation Financial Model”) dated June 28, 2025, reflecting the Corporation’s management’s view of financial and operating projections for the Corporation and discussions with the Corporation’s management with respect thereto;

 

xi.	Selected public market trading statistics and financial information of the Corporation and other entities considered by Raymond James to be relevant;

 

xii.	Other public information relating to the business, operations and financial condition of the Corporation considered by Raymond James to be relevant;

 

xiii.

Other publicly available information relating to selected public companies considered by Raymond James to be relevant, including where available to Raymond James, published reports by equity research analysts and industry reports;

 

xiv.	Information with respect to selected precedent transactions considered by Raymond James to be relevant; and

 

xv.	Such other information, analyses, investigations, and discussions as Raymond James considered necessary or appropriate in the circumstances.

Raymond James has also participated in various discussions with Fasken, legal counsel to the Board and the Corporation, and Norton Rose, legal counsel to the Special Committee, concerning the Arrangement Agreement and related matters. Raymond James has also reviewed the projections provided by the Corporation’s management in the Corporation Financial Model together with the CVR Milestones. Additionally, Raymond James has discussed with the Corporation’s management their perspectives on the likelihood of achieving the proposed CVR Milestones.

Raymond James also participated in discussions with the Corporation’s management, the Corporation’s financial advisor Barclays, as well as the Board, respecting potential alternative strategic and business development transactions with select third parties other than the Purchaser that were considered as part of the market check and sale processes conducted, and the status, outcomes and probabilities of those potential alternative strategic transactions.

Raymond James has not, to the best of its knowledge, been denied access by the Corporation to any information requested by Raymond James.

The President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer of the Corporation have represented (with respect to and on behalf of the Corporation and not in their personal capacities) to Raymond James that, to the best of their knowledge after due inquiry, there have been no valuations or appraisals relating to the Corporation or any of its subsidiaries, or any of their material assets, made in the 24 months preceding the date of the Raymond James Fairness Opinion, including any “prior valuation” within the meaning of Multilateral Instrument 61-101.

Raymond James has not been asked to prepare and has not prepared, as a formal valuation under Multilateral Instrument 61-101, an appraisal of any of the assets or securities of the Corporation or any of its subsidiaries and the Raymond James Fairness Opinion should not be construed as such. Raymond James has relied upon the advice of counsel to the Corporation that the Arrangement is not subject to the formal valuation requirements of Multilateral Instrument 61-101. Raymond James has relied upon, and has assumed the completeness, accuracy and fair presentation of all information, data, advice, opinions and representations obtained by Raymond James from public sources, or provided to Raymond James by the Corporation or its affiliates or advisors or otherwise obtained by Raymond James pursuant to their engagement, and the Raymond James Fairness Opinion is conditional upon such completeness, accuracy and fair presentation.

Raymond James has not been requested to, or attempted to verify independently the accuracy, completeness or fairness of presentation of any such information, data, advice, opinions and representations. Raymond James has not met separately with the independent auditors of the Corporation in connection with preparing the Raymond James Fairness Opinion and have assumed the accuracy and fair presentation of, and relied upon, the Corporation’s audited financial statements and the reports of the auditors thereon and the Corporation’s interim unaudited financial statements.

 

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With respect to the non-historical financial data, operating and financial forecasts and budgets provided to Raymond James concerning the Corporation and relied upon in their financial analyses, Raymond James has assumed that they have been reasonably prepared on bases reflecting the most reasonable assumptions, estimates and judgements of the Corporation’s management, having regard to the Corporation’s business, plans, financial condition and prospects. Raymond James has also assumed that the Arrangement will be completed substantially in accordance with its terms (without any waiver or amendment of any terms or conditions) and all applicable Laws, and that the Arrangement Agreement and the Circular will disclose all material facts relating to the Arrangement and will satisfy all applicable legal requirements.

Raymond James has assumed that the Arrangement Agreement (including the schedules thereto and the Corporation Disclosure Letter relating thereto) will not differ materially from the form of the drafts reviewed by Raymond James; Raymond James has assumed that the representations and warranties made by the parties in the Arrangement Agreement are true and correct.

The Corporation has represented to Raymond James, in a certificate of its President and Chief Executive Officer and its Senior Vice President and Chief Financial Officer dated the date of the Raymond James Fairness Opinion (with respect to and on behalf of the Corporation and not in their personal capacities), among other things, that the information (financial or otherwise), data, documents, opinions, appraisals, valuations and other information and materials of whatsoever nature or kind provided to Raymond James by or on behalf of the Corporation respecting the Arrangement, the Corporation and its subsidiaries and their respective assets, including, without limitation, the written information and discussions concerning the Corporation referred to under the heading “Scope of Review” in the Raymond James Fairness Opinion (collectively, the “Information provided to Raymond James”), are complete, true, accurate and correct in all material respects at the date the Information provided to Raymond James was provided to Raymond James and that no change has occurred in the Information provided to Raymond James or any part thereof, since the respective dates which would have or which would reasonably be expected to have a material effect on the Raymond James Fairness Opinion or the Arrangement.

The Raymond James Fairness Opinion does not address the treatment of the Corporation’s holders of dilutive securities under the Arrangement.

Raymond James are not legal, tax or accounting experts and express no opinion concerning any legal, tax or accounting matters concerning the Arrangement or the sufficiency of the Raymond James Fairness Opinion for the Special Committee’s purposes; Raymond James has relied upon, without independent verification, the assessment by the Corporation and its legal, tax and accounting advisors with respect to such matters.

The Raymond James Fairness Opinion is rendered on the basis of securities markets, economic and general business and financial conditions prevailing as at the date of the Raymond James Fairness Opinion and the conditions and prospects, financial and otherwise, of the Corporation as they are reflected in the Information provided to Raymond James and as they were represented to Raymond James in discussions with the Corporation’s management and advisors. In Raymond James’ analyses and in connection with the preparation of the Raymond James Fairness Opinion, Raymond James made numerous assumptions with respect to industry performance, general business, markets and economic conditions and other matters, many of which are beyond the control of any party involved in the Arrangement.

Raymond James believes that its analyses must be considered as a whole and that selecting portions of its analyses and the factors considered by it, without considering all factors and analyses together, could create a misleading view of the process underlying the Raymond James Fairness Opinion. The preparation of an opinion is complex and is not necessarily susceptible to partial analysis or summary description and any attempt to do so could lead to undue emphasis on any particular factor or analysis; accordingly, the Raymond James Fairness Opinion should be read in its entirety.

The Raymond James Fairness Opinion was given as of July 2, 2025 and, although Raymond James reserves the right to change or withdraw the Raymond James Fairness Opinion if Raymond James learns that any of the information, including the Information provided to Raymond James, that Raymond James relied upon in preparing the Raymond James Fairness Opinion was inaccurate, incomplete or misleading in any material respect, Raymond James disclaims any obligation to change or withdraw the Raymond James Fairness Opinion, to advise any person of any change that may come to Raymond James’ attention or to update the Raymond James Fairness Opinion after the date of the Raymond James Fairness Opinion.

 

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Fairness Methodologies

In support of the Raymond James Fairness Opinion, Raymond James has performed certain financial analyses on the Corporation, based on those methodologies and assumptions that Raymond James considered appropriate in the circumstances for the purposes of providing the Raymond James Fairness Opinion. In the context of the Raymond James Fairness Opinion, Raymond James has considered the following methodologies (as each such term is defined below):

 

a)	Premiums Paid Analysis;

 

b)	Public Company Trading with Premium Approach;

 

c)	Precedent Transactions Approach; and

 

d)	Discounted Cash Flow (DCF) Approach.

Premiums Paid Analysis

Raymond James compared the premium represented by the Consideration, calculated with reference to the unaffected share price of the Corporation on the Nasdaq as at April 10, 2025 (the trading day immediately preceding the public press release by the Purchaser), to premiums paid for shares of target companies in Canadian change of control transactions over the past eight years and North American change of control transactions in the specialty pharmaceutical industry in the last five years (the “Precedent Premiums”) considered by Raymond James to be relevant. The observed average and median for the Precedent Premiums were 44% and 39%, respectively for Canadian change of control transactions and 85% and 65%, respectively for transactions in the North American specialty pharmaceutical industry.

Raymond James compared the implied Share value as derived from the Premiums Paid Analysis to the Cash Consideration, and to the Cash Consideration plus the CVR.

Public Company Trading with Premium Approach

Raymond James compared public market trading statistics of the Corporation to corresponding data from selected publicly traded, specialty pharmaceutical companies that Raymond James considered relevant. Raymond James based its comparison on the following companies (the “Selected Publicly-Traded Peers”):

 

•

Knight Therapeutics Inc.

 

•

Cipher Pharmaceuticals Inc.

 

•

HLS Therapeutics Inc.

 

•

Medexus Pharmaceuticals Inc.

 

•

Emergent BioSolutions Inc.

 

•

Pharming Group N.V.

 

•

Ironwood Pharmaceuticals, Inc.

 

•

SIGA Technologies, Inc.

Raymond James examined multiples based on the enterprise value for each of the Selected Publicly-Traded Peers to the revenue for such companies. While Raymond James did not consider any of the Selected Publicly-Traded Peers to be directly comparable to the Corporation, Raymond James believed that they shared certain business, financial, and/or operational characteristics to

 

- 51 -

those of the Corporation and Raymond James used its professional judgement, informed by the analysis, to arrive at ranges of multiples that would be appropriate for companies with the Corporation’s operational, financial and risk profile. Raymond James then applied the selected range of enterprise value multiples to the corresponding data of the Corporation for calendar year (“CY”) 2025 and CY2026, to calculate an implied equity value of the Corporation, to which Raymond James applied a change of control premium (the “Public Company Trading with Premium Approach”).

The Public Company Trading with Premium Approach implied an enterprise value (calculated as equity value of the Corporation plus debt, less cash and cash equivalents, and if applicable, adjusted for any minority interests or unconsolidated investments, the “Enterprise Value”) to the Corporation’s CY2025 revenue (“EV/CY2025”) multiple range of 2.3x to 2.7x, and an implied Enterprise Value to the Corporation’s CY2026 revenue (“EV/CY2026”) multiple range of 2.0x to 2.4x.

Raymond James compared the implied Share value as derived from the Public Company Trading with Premium Approach to the Cash Consideration, and to the Cash Consideration plus the CVR.

Precedent Transactions Approach

Raymond James reviewed available information in connection with select change of control transactions involving specialty pharmaceutical companies that Raymond James considered relevant (the “Precedent Transactions Approach”). Raymond James considered the enterprise value of the acquired companies compared to such acquired companies’ revenue for the first and second forward calendar years from the time of such transaction. Raymond James then applied a range of selected enterprise value multiples from these transactions to the corresponding CY2025 and CY2026 data of the Corporation. The Precedent Transactions Approach implied an EV/CY2025 multiple range of 1.8x to 2.8x and EV/CY2026 range of 1.7x to 2.1x.

Raymond James compared the implied Share value as derived from the Precedent Transactions Approach to the Cash Consideration, and to the Cash Consideration plus the CVR.

Discounted Cash Flow Approach

The discounted cash flow approach (the “DCF Approach”) is a present value calculation of future cash flow expectations to determine a value of a company. It involves estimating annual net discretionary (or “free”) cash flows for each year of the cash flow projection period. Where the business is expected to operate beyond the cash flow projection period, subsequent projected results are capitalized at the end of the cash flow period utilizing a terminal cash flow method, and then discounted to their present value.

Raymond James utilized an unlevered discounted cash flow analysis whereby Raymond James, using projections provided by the Corporation’s management, calculated the earnings before interest and taxes and then proceeded to deduct taxes, capital expenditures, anticipated working capital requirements, and add back depreciation and amortization. Raymond James’ calculations were based on projections of cash flows and other amounts prepared by the Corporation’s management.

The DCF Approach requires that certain assumptions be made to derive the present value of future free cash flows including, among other things, growth rates and profit margins, capital investment, working capital, discount rates, terminal multiples and terminal growth rates. As part of the DCF Approach, Raymond James performed a range of sensitivity analyses on a variety of factors. This included considering a range of estimated terminal values by assuming a growth rate on the terminal year unlevered free cash flow after tax in perpetuity. This methodology capitalizes the terminal year unlevered free cash flow after tax at the WACC (as defined below) less a growth rate reflective of the long-term growth of unlevered free cash flows after tax beyond the discrete forecast period.

The projected free cash flows of the Corporation were discounted using weighted average costs of capital (“WACC”). In developing an estimate for the WACC, Raymond James employed the capital asset pricing model to determine appropriate costs of equity for the Corporation. Key assumptions included:

 

•

the assessment of observed betas for each of the Selected Publicly-Traded Peers;

 

- 52 -

•

the Government of Canada 10-year bond yield;

 

•

a standard market risk premium; and

 

•

an applicable company and size specific premium.

The after-tax cost of debt reflects Raymond James’ estimate of the marginal cost of issuing new debt for the Corporation. The Corporation’s capital structure was adjusted to reflect leverage levels consistent with industry standards. The WACC utilized by Raymond James ranged from 12.4% to 14.4%.

The DCF Approach implied an EV/CY2025 multiple range of 2.0x to 2.2x and an implied EV/CY2026 multiple range of 1.6x to 1.8x.

Raymond James compared the implied Share value as derived from the DCF Approach to the Cash Consideration, and to the Cash Consideration plus the CVR.

 

6.	Procedural Steps

The Arrangement will be implemented by way of a statutory plan of arrangement under the provisions of Chapter XVI —Division II of the QBCA pursuant to the terms of the Arrangement Agreement. The following procedural steps must be taken in order for the Arrangement to be effective:

 

(a)

the Required Shareholder Approval must be obtained in the manner set forth in the Interim Order;

 

(b)

the Court must grant the Final Order approving the Arrangement;

 

(c)

all conditions precedent to the Arrangement, as set forth in the Arrangement Agreement, must be satisfied or waived by the appropriate party or parties; and

 

(d)

the Articles of Arrangement, prepared in the form prescribed by the QBCA and signed by an authorized director or officer of the Corporation, must be filed with the Enterprise Registrar and a Certificate of Arrangement issued related thereto.

The Plan of Arrangement is attached as Appendix B to this Circular and a copy of the Arrangement Agreement is available under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search. See “The Arrangement – Arrangement Steps”.

 

7.	Arrangement Steps

Pursuant to the Arrangement, each of the following events shall occur and shall be deemed to occur sequentially as set out below without any further authorization, act or formality, in each case, unless stated otherwise, starting at the Effective Time and effective as at two (2) minute intervals (in each case, unless otherwise specified):

 

(1)

notwithstanding the terms of the Shareholder Rights Plan, the Shareholder Rights Plan shall be terminated, and all rights issued pursuant to the Shareholder Rights Plan shall be cancelled without any payment in respect thereof;

 

(2)

notwithstanding the terms of the Investor Rights Agreement, the Investor Rights Agreement shall be terminated;

 

(3)

each Option outstanding immediately prior to the Effective Time with an Exercise Price per Share that is less than the Cash Consideration that has not yet vested in accordance with its terms shall be accelerated so that such Option becomes exercisable, notwithstanding the terms of the Share Option Plan or any award or similar agreement pursuant to which such Option was granted or awarded, immediately following which each such

 

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Option that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the Cash Consideration less the applicable Exercise Price in respect of such Option, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such Option shall immediately be cancelled and all of the Corporation’s obligations with respect to such Option shall be deemed to be fully satisfied;

 

(4)

each Underwater Option that has not yet vested in accordance with its terms shall be accelerated so that such Option becomes exercisable, notwithstanding the terms of the Share Option Plan or any award or similar agreement pursuant to which such Option was granted or awarded, immediately following which each such Option that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such Option shall immediately be cancelled and all of the Corporation’s obligations with respect to such Option shall be deemed to be fully satisfied; provided that each CVR issued to a holder in respect of an Underwater Option shall only entitle such holder to a maximum amount in cash equal to the amount by which the Cash Consideration plus the Maximum Milestone Payments Amount exceeds the Exercise Price per Share of such Underwater Option, if payable and as otherwise determined in accordance with the CVR Agreement. For greater certainty, where the Exercise Price of any Option is greater than or equal to the Cash Consideration plus the Maximum Milestone Payments Amount, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such Option the Consideration or any other amount in respect of such Option, and the Option shall be immediately cancelled;

 

(5)

each SAR outstanding immediately prior to the Effective Time with an Exercise Price per Share that is less than the Cash Consideration that has not yet vested in accordance with its terms shall be accelerated so that such SAR becomes exercisable, notwithstanding the terms of the SAR Plan or any award or similar agreement pursuant to which any SARs were granted or awarded, immediately following which each such SAR that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the Cash Consideration less the applicable Exercise Price in respect of such SAR, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement and such SAR shall immediately be cancelled and all of the Corporation’s obligations with respect to such SAR shall be deemed to be fully satisfied;

 

(6)

each Underwater SAR that has not yet vested in accordance with its terms shall be accelerated so that such SAR becomes exercisable, notwithstanding the terms of the SAR Plan or any award or similar agreement pursuant to which such SAR was granted or awarded, immediately following which each such SAR that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and such SAR shall immediately be cancelled and all of the Corporation’s obligations with respect to such SAR shall be deemed to be fully satisfied; provided that each CVR issued to a holder in respect of an Underwater SAR shall only entitle such holder to a maximum amount in cash equal to the amount by which the Cash Consideration plus the Maximum Milestone Payments Amount exceeds the Exercise Price per Share of such Underwater SAR, if payable and as otherwise determined in accordance with the CVR Agreement. For greater certainty, where the Exercise Price of any SAR is greater than or equal to the Cash Consideration plus the Maximum Milestone Payments Amount, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such SAR the Consideration or any other amount in respect of such SAR, and the SAR shall be immediately cancelled;

 

(7)

each Warrant outstanding immediately prior to the moment that is immediately prior to the Effective Time that has not yet vested in accordance with its terms shall be accelerated so that such Warrant becomes exercisable, notwithstanding the terms of the Warrants or any award or similar agreement pursuant to which any Warrants were granted or awarded, immediately following which each Warrant that is outstanding and has not been duly exercised, without any further action by or on behalf of the holder thereof, shall be deemed to be assigned and

 

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surrendered by such holder to the Corporation, free and clear of all Liens, in exchange for an amount in cash from the Corporation equal to the amount (if any) by which the Cash Consideration exceeds the Exercise Price of such Warrant, multiplied by the fraction of Share that such Warrant entitles the holder to purchase, being one fourth (1/4) of a Share, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR, issued by the Purchaser on behalf of the Corporation, for every four (4) Warrants, with any fractions rounded down to the nearest whole with no further compensation for any loss of such fractional part of a CVR, less any applicable withholdings pursuant to the Plan of Arrangement, and each such Warrant shall immediately be cancelled and all of the Corporation’s obligations with respect to each such Warrant shall be deemed to be fully satisfied. For greater certainty, where the foregoing amount is equal to zero or negative for any such Warrant, neither the Corporation nor the Purchaser shall be obligated to pay the holder of such Warrant the Cash Consideration or any other amount in respect of such Warrant, and the Warrant shall be immediately cancelled;

 

(8)

each director of the Corporation shall resign from, and shall be deemed to have immediately resigned from, the Board and the board of directors of any Subsidiary;

 

(9)

each DSU outstanding immediately prior to the Effective Time (whether vested or unvested) shall, notwithstanding the terms of the DSU Plan or any award or similar agreement pursuant to which any DSUs were granted or awarded, as applicable, be deemed to have vested;

 

(10)

each whole DSU that remains outstanding shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation, free and clear of all Liens, in exchange for (i) an amount in cash from the Corporation equal to the Cash Consideration, in each case, with such amounts to be paid to the applicable holders in accordance with the Plan of Arrangement less any applicable withholdings pursuant to the Plan of Arrangement and (ii) one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and each such DSU shall immediately be cancelled and all of the Corporation’s obligations with respect to each such DSU shall be deemed to be fully satisfied;

 

(11)

each fractional DSU that remains outstanding (if any) shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation in exchange for an amount in cash from the Corporation equal to the Cash Consideration multiplied by the applicable fraction of a DSU held by the applicable holder, in each case, with such amounts to be paid to the applicable holders in accordance with the Plan of Arrangement less any applicable withholdings pursuant to the Plan of Arrangement and each such fractional DSU shall immediately be cancelled and all of the Corporation’s obligations with respect to each such fractional DSU shall be deemed to be fully satisfied;

 

(12)

(i) each former holder of Incentive Securities shall cease to be a holder of such Incentive Securities, (ii) such holder’s name shall be removed from each applicable register, (iii) the Incentive Plans and any and all option, award or similar agreements relating to the Incentive Securities shall be terminated and shall be of no further force and effect, and (iv) each such holder shall cease to have any rights as a holder in respect of such Incentive Securities or under the Incentive Plans and have only the right to receive the consideration, if any, to which it is entitled to, at the time and in the manner specified in the Plan of Arrangement;

 

(13)

each Exchangeable Subscription Receipt that is not exchanged into Shares immediately prior to the Effective Time and that remains outstanding shall, without any further action by or on behalf of the holder thereof, be deemed to be transferred by such holder to the Corporation, free and clear of all Liens, in exchange for (i) the Exchangeable Subscription Receipt Cash Consideration with such amount to be paid to the holder in accordance with the Plan of Arrangement less any applicable withholdings and (ii) one (1) CVR issued by the Purchaser on behalf of the Corporation, less any applicable withholdings pursuant to the Plan of Arrangement, and each such Exchangeable Subscription Receipt shall immediately be cancelled and all of the Corporation’s obligations with respect to each such Exchangeable Subscription Receipt shall be deemed to be fully satisfied;

 

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(14)

each outstanding Share held by a Dissenting Holder in respect of which Dissent Rights have been validly exercised shall be deemed to be transferred without any further action by or on behalf of the holder thereof to the Purchaser, free and clear of all Liens, and:

 

(a)

such Dissenting Holder shall cease to be the holder of such Share and to have any rights as a Shareholder, other than the right to be paid the fair value of such Share by the Purchaser in accordance with the Plan of Arrangement;

 

(b)

such Dissenting Holder’s name shall be removed from the register of holders of Shares maintained by or on behalf of the Corporation;

 

(c)

the Purchaser shall be recorded in the register of holders of Shares maintained by or on behalf of the Corporation as the holder of the Shares so transferred, and shall be deemed to be the legal and beneficial owner thereof; and

 

(15)

concurrently with the step set forth above, each outstanding Share (for greater certainty, other than the Shares held by Dissenting Holders who have validly exercised their respective Dissent Rights) shall be transferred without any further action by or on behalf of the holder thereof, to the Purchaser, free and clear of all Liens, in exchange for the Cash Consideration, less any applicable withholdings pursuant to the Plan of Arrangement, and one (1) CVR, less any applicable withholdings pursuant to the Plan of Arrangement, and:

 

(a)

the holder of such Share shall cease to be the holder thereof and to have any rights as a Shareholder other than the right to receive the Consideration in accordance with the Plan of Arrangement;

 

(b)

such holder’s name shall be removed from the register of holders of Shares maintained by or on behalf of the Corporation; and

 

(c)

the Purchaser shall be recorded in the register of holders of Shares maintained by or on behalf of the Corporation as the holder of the Shares so transferred, and shall be deemed to be the legal and beneficial owner thereof.

Notwithstanding anything to the contrary, to the extent the Corporation determines that any treatment of any Option, Warrant, SAR or DSU or payment pursuant to the Plan of Arrangement may trigger any tax or penalty under Section 409A of the Code, the Corporation shall be permitted to take any and all actions the Corporation in its sole discretion, after consultation with and approval by Purchaser, deems necessary or advisable to avoid such tax or penalty, including by altering the treatment or payment terms or otherwise providing that such payment shall be made on the earliest date that payment would not trigger such tax or penalty.

This description of the steps of the Arrangement is qualified in its entirety by the full text of the Plan of Arrangement attached as Appendix B to this Circular.

 

8.	Certain Effects of the Arrangement

If the procedural steps described above are taken and the Arrangement becomes effective, Shareholders will receive the Consideration for their Shares, including CVRs to be issued by the Purchaser to Shareholders as part of the Consideration, and the only shareholder of the Corporation will be the Purchaser. If the Arrangement is completed, other than possible Milestone Payments to CVR Holders, the Purchaser will be the sole beneficiary of the Corporation’s future earnings and growth, if any, and will also bear the risks of the Corporation’s ongoing operations, including the risks of any decrease in the Corporation’s value after the Arrangement. The Corporation expects that the Shares will be delisted from the TSX and Nasdaq promptly following the Effective Date. Following the Effective Date, it is expected that the Purchaser will cause the Corporation to apply to terminate its status as a reporting issuer under the Securities Laws of each province of Canada and pursuant to Section 12(g)(4) of the U.S. Exchange Act and will cease to file continuous disclosure documents with Canadian and U.S. securities regulatory authorities.

 

9.	Required Shareholder Approval

At the Meeting, pursuant to the Interim Order, Shareholders will be asked to consider and, if deemed advisable, to pass the Arrangement Resolution. To be effective, the Arrangement Resolution must be approved by (i) at least 66²⁄₃% of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, and (ii) at least a majority of the votes cast thereon by the holders of Shares present in person or virtually or represented by proxy at the Meeting, excluding Shares required to be excluded pursuant to Multilateral Instrument 61-101.

 

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10. Support and Voting Agreements

Concurrently with the execution of the Arrangement Agreement on July 2, 2025, the Supporting Shareholders, who together beneficially own or exercise control or direction over an aggregate of 524,266 Shares, representing in the aggregate approximately 1.14% of the Corporation’s outstanding Shares, entered into support and voting agreements with the Purchaser (the “Support and Voting Agreements”), pursuant to which they have agreed, among other things, to vote in favour of the Arrangement Resolution, subject to customary exceptions.

The Support and Voting Agreements entered into with the Purchaser can be found under the Corporation’s issuer profile on SEDAR+ at www.sedarplus.ca and on EDGAR at https://www.sec.gov/edgar/search. The following is only a summary of the Support and Voting Agreements and is qualified in its entirety by the full text of each of the Support and Voting Agreements.

Pursuant to the terms of the Support and Voting Agreements, the Supporting Shareholders have agreed, solely in their capacity as securityholders and not in their capacity as directors or senior officers of the Corporation, among other things:

 

(a)

to cause to be counted as present for purposes of establishing quorum and vote or to cause to be voted all of the Shares and Options they hold (collectively, “Subject Securities”) in favour of the approval of the Arrangement Resolution and any other matter necessary for the consummation of the Arrangement and against any proposed action or agreement that would reasonably be expected to adversely affect, prevent, materially delay or interfere with the completion of the Arrangement;

 

(b)

no later than ten days prior to the Meeting, to deliver or to cause to be delivered to the Corporation duly executed proxies or voting instruction forms voting in favour of the approval of the Arrangement Resolution, to name in such proxies or voting instruction forms those individuals as designated in the Circular and such proxies or voting instruction forms not to be revoked or withdrawn without the prior written consent of the Purchaser;

 

(c)

not to, directly or indirectly, (i) sell, transfer, gift, assign, grant a participation interest in, option, pledge, hypothecate, grant a security or voting interest in or otherwise convey or encumber (each, a “Transfer” for the purpose of this paragraph), or enter into any agreement, option or other arrangement (including any profit-sharing arrangement, forward sale or other monetization arrangement) with respect to the Transfer of any of its Subject Securities to any Person; (ii) grant any proxies, voting instructions or power of attorney, deposit any of its Subject Securities into any voting trust or enter into any voting arrangement, whether by proxy, voting agreement or otherwise, with respect to its Subject Securities, other than pursuant to the Arrangement Agreement and any amendment thereto; or (iii) agree to take any of the actions described in the foregoing clauses (i) and (ii); provided that, the director or senior officer of the Corporation may (i) exercise Options to acquire additional Shares, and (ii) Transfer Subject Securities to a corporation, family trust, registered retirement savings plan or other entity directly or indirectly owned or controlled by the Supporting Shareholder or under common control with or controlling the Supporting Shareholder provided that (x) such Transfer shall not relieve or release them of or from his or her obligations under the Arrangement Agreement, including, without limitation, their obligation to vote or cause to be voted all Subject Securities at the Meeting in favour of the approval of the Arrangement Resolution and any other matter necessary for the consummation of the Arrangement, and (y) prompt written notice of such Transfer is provided to the Purchaser and the transferee agrees to be bound by the terms of the Support and Voting Agreement as though it were an original signatory thereto on terms acceptable to the Purchaser acting reasonably; and

 

(d)

not to exercise any rights of appraisal or rights of dissent provided under any Laws or otherwise in connection with the Arrangement.

The Support and Voting Agreements shall terminate upon the mutual written agreement of the parties thereto or shall automatically terminate upon the earlier of: (i) the Effective Time, (ii) the Purchaser, without the consent of the Supporting Shareholders, decreasing the Consideration or changing, in a manner adverse to them, the form of Consideration payable to them under the Arrangement Agreement, or (iii) the termination of the Arrangement Agreement in accordance with its terms.

 

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11.	Sources of Funds

Concurrently with the execution and delivery of the Arrangement Agreement, the Purchaser delivered to the Corporation the fully executed Debt Commitment Letter addressed to Future Pak, among others, pursuant to which, among other things, the lenders thereunder (collectively, the “Lenders”), have committed to provide term loans in the aggregate principal amounts of $220 million, subject to the terms and conditions set forth therein, the proceeds of which are to be used by the Purchaser for, among other things, the financing of the Arrangement (the “Debt Financing”).

The Purchaser has agreed under the Arrangement Agreement that it shall, and shall cause its affiliates to use commercially reasonable best efforts to take or cause to be taken all actions and to do, or cause to be done, all things necessary to arrange and obtain the proceeds of the Debt Financing on the terms and conditions described in the Debt Commitment Letter by no later than the date specified in the Arrangement Agreement, including using commercially reasonable best efforts to, among other things, negotiate and enter into definitive agreements with respect to the Debt Financing on the terms and conditions contained in the Debt Commitment Letter and to satisfy on a timely basis all conditions to funding in the Debt Commitment Letter that are within its control.

The Purchaser has represented in the Arrangement Agreement that, assuming the Debt Financing is funded in accordance with the Debt Commitment Letter, the net proceeds contemplated by the Debt Financing will, in the aggregate (when taken together with any other available financial resources of the Purchaser at such time, as applicable), be sufficient to enable the Purchaser to consummate the Arrangement. Obtaining the Debt Financing or any alternative financing is not a condition to the consummation of the Arrangement.

If the Purchaser fails to fund the amounts required by it to be funded pursuant to the Arrangement Agreement, all other conditions to the closing of the Arrangement in favour of the Purchaser are and continue to be satisfied or waived, and the Corporation is otherwise prepared to consummate the Arrangement, the Corporation may terminate the Arrangement Agreement and the Purchaser shall be required to pay the Reverse Termination Fee of $12 million to the Corporation. See “The Arrangement Agreement – Termination Fee and Reverse Termination Fee”.

 

12.	Guarantee of Future Pak

Pursuant to the Arrangement Agreement, Future Pak guarantees the entirety of the Purchaser’s covenants, obligations and undertakings thereunder, including the payment of the aggregate Cash Consideration, the Exchangeable Subscription Receipt Consideration, the Warrant Consideration, the Incentive Securities Consideration and all other amounts payable in connection with the Arrangement Agreement, including the Reverse Termination Fee.

 

13.	Expenses of the Arrangement

The Corporation estimates that expenses in the aggregate amount of approximately $16 million will be incurred by the Corporation in connection with the Arrangement, including, among others, legal, financial advisory, proxy solicitation, filing fees and costs, the cost of preparing, printing and mailing this Circular, organizing and holding the Meeting, and fees in respect of the Fairness Opinions. Except as otherwise expressly provided in the Arrangement Agreement (including the Termination Fee and the Reverse Termination Fee), the parties to the Arrangement Agreement agreed that all out-of-pocket expenses of the parties relating to the Arrangement Agreement or the transactions contemplated thereby shall be paid by the party incurring such expenses.

 

14.	Interest of Certain Persons in the Arrangement

Other than as described below, none of the directors or senior officers of the Corporation or, to the knowledge of such directors and senior officers, any of their respective associates or affiliates, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter to be acted upon in connection with the Arrangement or that would materially affect the Arrangement.

 

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Ownership of Securities by Directors and Senior Officers

The Shares, Options and DSUs held by the directors and senior officers of the Corporation are listed under “Information Concerning the Corporation – Ownership of Securities”. All such Shares, Options and DSUs held by the directors and senior officers of the Corporation will be treated in the same fashion under the Arrangement as those held by any other holder.

In connection with the Arrangement and subject to the completion thereof and as contemplated in the Arrangement Agreement and the Plan of Arrangement: (i) each Share will be exchanged for the Consideration (less any applicable withholdings); (ii) each Option outstanding will be exchanged for an amount by which the Cash Consideration exceeds the Exercise Price of the Option, plus one CVR for each such Option (less any applicable withholdings); (iii) each Underwater Option outstanding will be exchanged for one CVR for each such Underwater Option and the holder thereof will be entitled to a portion of the payments made to each CVR, which portion shall be equal to the amount by which the Cash Consideration plus maximum aggregate possible payments to be made for a CVR exceeds the Exercise Price of such Underwater Option (less any applicable withholdings); and (iv) each DSU will be exchanged for the Cash Consideration per share plus one CVR for each DSU held (less any applicable withholdings). See “The Arrangement – Arrangement Steps”. Also refer to the full text of the Plan of Arrangement, attached as Appendix B to this Circular.

The table below sets forth the proceeds to be received by each of the directors and senior officers of the Corporation at Closing of the Arrangement (less any applicable withholdings) for the Shares, vested Options and DSUs held by them as at the date hereof :

 

Name		Position with the Corporation		Shares (1)				Vested Options (2)				DSUs (3)				Total proceeds to be received for such securities
Frank A. Holler		Chair of the Board and Director			59,750				22,727				1,325			$223,368
				($	179,847	)		($	39,533	)		($	3,988	)
Paul Lévesque		President and Chief Executive			72,800				500,000				—			$1,088,878
		Officer and Director		($	219,128	)		($	869,750	)
Joseph P. Arena		Director			13,750				22,926				—			$81,507
				($	41,387	)		($	40,120	)
Andrew Molson		Director			137,500				22,727				2,531			$461,026
				($	413,875	)		($	39,533	)		($	7,618	)
Dawn Svoronos		Director			110,900				22,727				214			$373,986
				($	333,809	)		($	39,533	)		($	644	)
Elina Tea		Director			—				22,727				—			$39,533
								($	39,533	)
Dale Weil		Director			43,242				22,727				1,383			$173,854
				($	130,158	)		($	39,533	)		($	4,163	)
Jordan Zwick		Director			—				22,926				—			$40,120
								($	40,120	)
Marie-Noël		Vice President, Finance			2,768				75,000				796			$139,593
Colussi				($	8,332	)		($	130,462	)		($	799	)
Philippe Dubuc		Senior Vice President and Chief			15,750				150,000				—			$308,332
		Financial Officer		($	47,407	)		($	260,925	)

 

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Name		Position with the Corporation		Shares (1)				Vested Options (2)				DSUs (3)				Total proceeds to be received for such securities
André Dupras		Vice President, Human			—				100,000				—			$173,950
		Resources						($	173,950	)
Christian		Senior Vice President and Chief			14,824				181,249				1,578			$369,870
Marsolais		Medical Officer		($	44,620	)		($	320,500	)		($	4,750	)
Jocelyn Lafond		General Counsel and Corporate			4,500				126,250				1,250			$241,302
		Secretary		($	13,545	)		($	223,995	)		($	3,762	)
John Leasure		Global Commercial Officer			51,250				125,000				—			$373,012
				($	154,262	)		($	218,750	)

(1)

The amounts reported in this column represents the number of Shares owned or over which control or direction is expected to be exercised, directly or indirectly, by such person at closing of the Arrangement and the value of the Cash Consideration (exclusive of applicable withholdings) that would be received in respect of such Shares pursuant to the Arrangement. The estimated amount of consideration to be received excludes the value of the CVRs that would be received in respect of such Shares.

(2)	The dollar amount represents the excess of the Cash Consideration over the Exercise Price of each such Option. The estimated amount of consideration to be received excludes the value of the CVRs that would be received in respect of such Options.

(3)	All DSUs are vested and may be settled following the departure of the director in accordance with their terms. The estimated amount of consideration to be received excludes the value of the CVRs that would be received in respect of such DSUs.

The table below sets forth the proceeds to be received by each of the directors and senior officers of the Corporation pursuant to the Arrangement (less any applicable withholdings) for the unvested Options held by them as at the date hereof, the vesting and/or settlement of which is to be accelerated pursuant to the Arrangement:

 

Name		Position with the Corporation		Unvested Options (1)				Total proceeds to be received for such securities
Frank A. Holler		Chair of the Board and Director			—				—
Paul Lévesque		President and Chief Executive			1,000,000			$	1,739,500
		Officer and Director		($	1,739,500	)
Joseph P. Arena		Director			—				—
Andrew Molson		Director			—				—
Dawn Svoronos		Director			—				—
Elina Tea		Director			—				—
Dale Weil		Director			—				—
Jordan Zwick		Director			—				—
Marie-Noël Colussi		Vice President, Finance			150,000			$	260,925
				($	260,925	)
Philippe Dubuc		Senior Vice President and Chief			300,000			$	521,850
		Financial Officer		($	521,850	)
André Dupras		Vice President, Human			200,000			$	347,900
		Resources		($	347,900	)

 

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Name		Position with the Corporation		Unvested Options (1)				Total proceeds to be received for such securities
Jocelyn Lafond		General Counsel and Corporate			200,000			$	347,900
		Secretary		($	347,900	)
John Leasure		Global Commercial Officer			250,000			$	437,500
				($	437,500	)
Christian Marsolais		Senior Vice President and Chief			300,000			$	521,850
		Medical Officer		($	521,850	)

 

(1)	The dollar amount represents the excess of the Cash Consideration over the Exercise Price of each such Option. The estimated amount of consideration to be received excludes the value of the CVRs that would be received in respect of such Options.

Ownership of Securities by Other Insiders

The Shares beneficially owned, or over which control or direction is exercised, directly or indirectly, by Investissement Québec and Soleus are listed under “Information Concerning the Corporation – Ownership of Securities”.

2024 Long-Term Incentive Replacement Payments

In light of the Targeted Market Checks and the related blackout period imposed by the Corporation, the senior officers of the Corporation did not receive their annual Option grants for the 2024 fiscal year. Instead, the Board approved as replacement a cash payment in an amount equal to the respective individual’s long-term incentive compensation component for the fiscal year ending November 30, 2024, payable in cash upon completion of the Arrangement, subject to the individual’s continued employment or service, as applicable, until the completion of the Arrangement. As a result, at Closing, the following amounts will be paid to senior officers of the Corporation: $1,545,750 will be paid to Paul Lévesque, President and Chief Executive Officer and Director of the Corporation; $208,600 will be paid to Marie-Noël Colussi, Vice President, Finance of the Corporation; $440,000 will be paid to Philippe Dubuc, Senior Vice President and Chief Financial Officer of the Corporation; $318,000 will be paid to André Dupras, Vice President, Human Resources of the Corporation; $390,000 will be paid to Jocelyn Lafond, General Counsel and Corporate Secretary of the Corporation; $402,000 will be paid to John Leasure, Global Commercial Officer of the Corporation; and $373,000 will be paid to Christian Marsolais, Senior Vice President and Chief Medical Officer of the Corporation.

Similarly, for the reasons explained above, the Corporation’s non-executive directors did not receive their annual long-term incentive grants as part of their Board compensation and instead the Board approved, as a replacement, a cash payment of $50,000 which is equivalent to the value of the foregone long-term equity incentive grants, for each non-executive director, to be paid upon Closing.

Transaction and Retention Bonuses

In connection with the Strategic Review, the Board approved transaction and retention bonuses to certain key employees of the Corporation to reward their contribution to the Targeted Market Checks and the Arrangement and the additional work required in connection therewith. Bonuses in the aggregate amount of CAD $155,000 were awarded to certain employees for their role in the Strategic Review. All such transaction bonuses will be payable in cash upon completion of the Arrangement, subject to the employees’ continued employment until the completion of the Arrangement. None of such transaction and retention bonuses were granted to senior officers of the Corporation.

Change of Control Benefits

The employment agreements of each senior officer (excluding the President and Chief Executive Officer) of the Corporation provide, among other things, that in the event such senior officer is terminated, or resigns of his/her own volition, within twenty-four (24) months following a change of control of the Corporation, he/she will be entitled to receive an amount ranging between 100% and 200% of his/her annual base salary plus an amount ranging between 100% and 200% of his/her annual bonus target calculated on such annual base salary. The determination of the aforementioned percentage that a senior officer is entitled to is

 

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based on the number of years he/she worked for the Corporation: (i) 100% where a senior officer has been employed by the Corporation between one (1) to five (5) years; (ii) 150% where a senior officer has been employed by the Corporation between five (5) to ten (10) years; and (iii) 200% where a senior officer has been employed by the Corporation for more than ten (10) years. In addition, senior officers who have accrued vacations over the years will receive an amount equal to the value of such accrued vacations calculated on the then annual base salary.

The employment agreement of the President and Chief Executive Officer of the Corporation provides, among other things, that in the event he is terminated within twenty-four (24) months following a change of control of the Corporation, he will be entitled to receive an amount equal to (i) 200% of his annual base salary, (ii) 200% of his annual bonus target calculated on such annual base salary, and (iii) the cash value of his benefits calculated over a twenty-four (24) month period preceding the date of his termination. Such employment agreement also provides that if he resigns of his own volition within twelve (12) months following a change of control of the Corporation, he will receive an amount equal to (i) 100% of his annual base salary, (ii) 100% of his annual bonus target calculated on such annual base salary, and (iii) the cash value of his benefits calculated over a twelve (12) month period preceding the date of his termination.

 

15.	Continuing Insurance and Coverage for Directors and Officers of the Corporation

Consistent with standard practice in similar transactions, in order to ensure that directors and officers do not lose or forfeit their protection under liability insurance policies maintained by the Corporation, the Arrangement Agreement provides for the maintenance of such protection for six years by way of the purchase by the Corporation of a customary tail insurance policy, subject to certain limitations set forth in the Arrangement Agreement.

 

16.	Arrangements between the Corporation and Security Holders

Except as otherwise described in this Circular, the Corporation has not made or proposed to be made any agreement, commitment or understanding with a security holder of the Corporation relating to the Arrangement. The Corporation is not a party to any of the Support and Voting Agreements.

 

17.	Intentions of Directors and Senior Officers

The Supporting Shareholders who together beneficially own or exercise control or direction over an aggregate of 524,266 Shares, representing in the aggregate approximately 1.14% of the Corporation’s outstanding Shares, have entered into Support and Voting Agreements with the Purchaser, pursuant to which they have agreed, among other things, to vote in favour of the Arrangement Resolution, subject to customary exceptions. See “The Arrangement – Support and Voting Agreements”.

 

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ITEM IX.

INFORMATION CONCERNING THE CORPORATION

 

1.

General

The Corporation is a specialty biopharmaceutical company focused on the commercialization of innovative therapies that have the potential to redefine standards of care. The Corporation’s business strategy is to grow revenues and to achieve a positive adjusted EBITDA from the sale of its existing and potential future assets in North America and to develop a portfolio of complementary products, compatible with its commercialization know-how. The Corporation currently commercializes two approved products for people living with HIV, namely: EGRIFTA SV^® and Trogarzo^® in the United States.

 

2.	Directors and Senior Officers

The following table sets forth the name, province/state and country of residence, principal occupation for the past five years and, where applicable, any other previously held positions, in the last five years for each of the current non-executive directors of the Corporation.

 

Name		Principal Occupation		Previously Held Positions (Last Five Years)
Joseph P. Arena		Corporate Director		Vice President Oncology
Pennsylvania, USA				Products, Global Regulatory
				Affairs (Pfizer, Inc.)
Frank A. Holler		Corporate Director – Chair of the		—
British Columbia,		Board of the Corporation
Canada		President and CEO, Ponderosa
		Capital Inc.
Andrew Molson		Chair of the Board, Avenir Global		—
Québec, Canada
Dawn Svoronos		Corporate Director		—
Québec, Canada
Elina Tea		Chief Financial Officer, GLS		Chief Financial Officer
Québec, Canada		North America		(Vosker Corp.: 2021-2022);
				Vice President, Corporate
				Development (COGECO
				Communications: 2020-2021)
Dale Weil		Executive Director, Teresa Dellar		—
Québec, Canada		Palliative Care Residence
Jordan Zwick		Chief Business Officer, Mirador		—
North Carolina, USA		Therapeutics, Inc.

The following table sets forth the name, province/state and country of residence, the principal occupation with the Corporation and, where applicable, any other previously held positions in the past five years with the Corporation or one of its subsidiaries, or outside of the Corporation of each of the senior officers of the Corporation.

 

Name		Principal Occupation		Previously Held Position (Last Five Years)
Paul Lévesque		President and Chief Executive		Global President, Rare
Québec, Canada		Officer of the Corporation,		Disease (Pfizer, Inc.)
		Director of the Corporation

 

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Name		Principal Occupation		Previously Held Position (Last Five Years)
Marie-Noël Colussi		Vice President, Finance		—
Québec, Canada
Philippe Dubuc		Senior Vice President and Chief		—
Québec, Canada		Financial Officer
André Dupras		Vice President, Human Resources		Vice President, Human
Québec, Canada				Resources (Clementia
				Pharmaceuticals Inc.)
Jocelyn Lafond		General Counsel and Corporate		—
Québec, Canada		Secretary
John Leasure		Global Commercial Officer		Country Lead and General
Vermont, USA				Manager, Oncology (Pfizer
				Canada)
Christian Marsolais		Senior Vice President and Chief		—
Québec, Canada		Medical Officer

 

3.	Description of Share Capital

The authorized share capital of the Corporation consists of an unlimited number of Shares, of which 45,980,019 Shares are issued and outstanding as at the date hereof and an unlimited number of preferred shares, none of which are issued and outstanding as at the date hereof. The Shares carry one vote per Share for all matters coming before Shareholders at the Meeting. Only Shareholders of record as at the Record Date will be entitled to vote at the Meeting. As at the date hereof, 3,381,816 Exchangeable Subscription Receipts are issued and outstanding. Exchangeable Subscription Receipts are fully funded, non-voting subscription receipts, exchangeable at all times into Shares on a one-for-one basis.

 

4.	Ownership of Securities

Ownership of Securities by Directors and Senior Officers

The names of the directors and senior officers of the Corporation, the positions held by them with the Corporation and the number and percentage of outstanding Shares beneficially owned, or over which control or direction is exercised, directly or indirectly, by each of them and their respective associates or affiliates, are listed in the table below. The table also sets out the number of Options and DSUs held by each of them as at the date hereof.

 

Name		Position with the Corporation		Shares				% of Shares				Options				DSUs
Joseph P. Arena		Director			13,750				0.03	%			31,903				—
Frank A. Holler		Director – Chair of the Board			59,750				0.13	%			31,704				1,325
Paul Lévesque		Director and President and Chief			72,800				0.16	%			2,033,682				—
		Executive Officer
Andrew Molson		Director			137,500				0.30	%			35,019				—
Dawn Svoronos		Director			110,900				0.24	%			49,205				214
Elina Tea		Director			—				—				22,727				—
Dale Weil		Director			43,242				0.09	%			45,455				1,383

 

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Name		Position with the Corporation		Shares				% of Shares				Options				DSUs
Jordan Zwick		Director			—				—				22,296				—
Marie-Noël Colussi		Vice President, Finance			2,768				0.01	%			329,523				795
Philippe Dubuc		Senior Vice President and Chief Financial Officer			15,750				0.03	%			664,604				—
André Dupras		Vice President, Human Resources			—				—				385,351				—
Jocelyn Lafond		General Counsel and Corporate Secretary			4,500				0.01	%			446,214				1,250
John Leasure		Global Commercial Officer			51,250				0.11	%			476,212				—
Christian Marsolais		Senior Vice President and Chief Medical Officer			14,824				0.03	%			695,093				1,578

Ownership of Securities by Other Insiders

To the knowledge of the Corporation after reasonable inquiry, the names of the insiders of the Corporation, other than directors and senior officers listed above, and the number and percentage of outstanding Shares beneficially owned, or over which control or direction is exercised, directly or indirectly, by each of them and their respective associates or affiliates, as at the date hereof, are listed in the table below:

 

Name		Number of Shares				Percentage of Outstanding Shares
Investissement Québec(1)			9,118,184				19.8	%
Soleus Capital Master Fund, L.P.			4,801,376				10.4	%

 

(1)	Investissement Québec holds 3,381,816 Exchangeable Subscription Receipts.

 

5.	Commitments to Acquire Securities of the Corporation

Except as disclosed in this Circular, there are no agreements, commitments or understandings to acquire securities of the Corporation by (i) the Corporation, (ii) any directors or officers of the Corporation, or (iii) to the knowledge of the directors and officers of the Corporation, after reasonable inquiry, by any insider of the Corporation or any associate or affiliate of such insider or any associate or affiliate of the Corporation or any person or company acting jointly or in concert with the Corporation.

 

6.	Previous Purchases and Sales

Other than the Shares issued pursuant to the exercise of Options, no Shares or other securities of the Corporation have been purchased or sold by the Corporation during the 12-month period preceding the date of this Circular.

 

7.	Previous Distributions

Below are the distributions of Shares that occurred during the five-year period preceding the date of this Circular, other than Shares issued pursuant to the exercise of Options.

On January 19, 2021, the Corporation completed a public offering for the sale and issuance of 16,727,900 units, for gross proceeds of $46 million. Each unit was comprised of one Share and one half of one common share purchase warrant of the Corporation (each whole warrant, a “Public Offering Warrant”), for a total of 8,363,950 Public Offering Warrants. During the fiscal year ending November 30, 2021, 233,400 Public Offering Warrants were exercised for proceeds of $742,000. All remaining issued and outstanding Public Offering Warrants expired on January 19, 2024.

 

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