Funds managed by Ember Infrastructure Management, LP, Investissement Québec, Caisse de dépôt et placement du Québec and the key executives of H2O Innovation Inc. entered into a definitive agreement to acquire H2O Innovation Inc. (TSX:HEO) from Investissement Québec, Caisse de dépôt et placement du Québec, the key executives and others for approximately CAD 380 million on October 3, 2023. Ember Infrastructure will acquire all of the issued and outstanding common shares in the capital of H2O Innovation, other than the shares to be rolled over by Investissement Québec (?IQ?), Caisse de dépôt et placement du Québec (?CDPQ?) and the key executives of the Corporation (collectively, the ?Rollover Shareholders?), for CAD 4.25 in cash per share. As part of the transaction, IQ has agreed to roll over all of its shares and increase its existing equity ownership in H2O Innovation by acquiring approximately CAD 20 million of additional shares for an amount per share equal to the consideration. Furthermore, CDPQ has agreed to roll over the majority of its shares and the key executives of H2O Innovation have agreed to roll over a portion of their shares for an amount per share equal to the consideration. Upon completion of the transaction, Ember will be the controlling shareholder of H2O Innovation, with IQ, CDPQ and the key executives of H2O Innovation, together, holding an equity interest in H2O Innovation of approximately 21%. Ember is funding its portion of the purchase price with capital it manages on behalf of its limited partners via private equity fund capital as well as select co-investors, including funds affiliated with the Ontario Power Generation Inc. Pension Fund. Pursuant to the agreement, H2O Innovation has a 30-day go-shop period that will extend from October 3, 2023 to November 2, 2023, during which Scotia Capital Inc. will solicit third-party interest in submitting a proposal which is superior to the proposal made by Ember. Upon closing of the transaction, H2O Innovation shares will be delisted from the TSX. H2O Innovation?s head office will remain in the Province of Québec. In case of termination of the agreement, the purchasers will be required to pay a termination fee of CAD 28.5 million whereas H2O Innovation will be required to pay a termination fee of CAD 14.3 million. The ?go-shop? period expired on November 2, 2023 at 11:59 p.m. (Montréal time) with no superior proposal having been received.

The transaction is subject to court approval, approval by H2O Innovation shareholders, dissent rights shall not have been exercised with respect to more than 5% of the issued and outstanding shares. H2O Innovation?s board of directors unanimously approved the transaction. The Superior Court of Québec issued on October 27, 2023 an interim order in connection with the acquisition. The transaction is not subject to any financing condition and is expected to close in the fourth quarter of 2023. As of November 20, 2023, Institutional Shareholder Services and Glass, Lewis & Co. have recommended shareholders to Vote FOR the acquisition. As of November 28, 2023, the H2O Innovation?s shareholders approved the transaction. The Superior Court of Québec issued on December 1, 2023 a final order approving the transaction

Norton Rose Fulbright Canada LLP is H2O Innovation?s legal counsel. Michael J. Aiello, Annemargaret Connolly, Charan J. Sandhu, Devon Bodoh, Gary D. Friedman, John O'Loughlin, Olivia J. Greer, Paul J. Wessel, Timothy C. Welch, Matthew D. Morton, Michael C. Naughton and Eoghan Keenan of Weil, Gotshal & Manges LLP acted as legal advisor to Ember. Davies Ward Phillips & Vineberg LLP is legal counsel to Ember, Marie-Josée Neveu of Fasken Martineau DuMoulin LLP is legal counsel to IQ and Blake, Cassels & Graydon LLP is legal counsel to CDPQ. Scotia Capital Inc. acted as exclusive financial advisor and fairness opinion provider to H2O Innovation and Desjardins Securities Inc. acted as independent financial advisor and fairness opinion provider to the special committee of board of directors of H2O Innovation. Raymond James acted as financial advisor to Ember. H2O Innovation has retained Kingsdale Advisors to act as proxy solicitation agent. TSX Trust Company acted as depositary bank to H2O.

Funds managed by Ember Infrastructure Management, LP, Investissement Québec, Caisse de dépôt et placement du Québec and the key executives of H2O Innovation Inc. completed the acquisition of H2O Innovation Inc. (TSX:HEO) from Investissement Québec, Caisse de dépôt et placement du Québec, the key executives and others on December 8, 2023.