SEDAR Interim Financial Statements

UNAUDITED CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS For the Nine-month period ended November 30, 2025 2 NOTICE OF NO AUDITOR REVIEW OF CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS In accordance with National Instrument 51-102 released by the Canadian Securities Administrators, the Company discloses that its auditors PricewaterhouseCoopers LLP have not reviewed the unaudited condensed interim consolidated financial statements for the Nine-month period ended November 30, 2025. 3 Consolidated Statements of Financial Position (in thousands of U.S. dollars) As at November 30, February 28, 2025 2025 $ $ Assets Current assets Cash and cash equivalents 36,320 34,872 Short-term investments 383 358 Accounts receivable 78,615 62,612 Income taxes recoverable 5,711 5,617 Inventories (note 8) 154,933 134,969 Deposits and prepaid expenses 4,162 3,689 Derivative assets 249 24 Assets held for sale (note 6) - 176,762 280,373 418,903 Non-current assets Property, plant and equipment 50,398 51,349 Intangible assets and goodwill 6,375 5,893 Deferred income taxes 5,193 25,101 Other assets 740 720 62,706 83,063 Total assets 343,079 501,966 Liabilities Current liabilities Bank indebtedness 16,097 2,508 Accounts payable and accrued liabilities 76,726 78,776 Income taxes payable 2,304 1,818 Customer deposits 11,559 22,338 Provisions 7,875 153,957 Derivative liabilities 145 480 Current portion of long-term lease liabilities 1,560 1,437 Current portion of long-term debt (note 9) 3,722 2,096 Liabilities held for sale (note 6) - 110,883 119,988 374,293 Non-current liabilities Long-term lease liabilities 4,221 4,727 Long-term debt (note 9) 13,967 14,107 Income taxes payable - 692 Deferred income taxes 1,339 737 Customer deposits 11,908 3,876 Other liabilities 5,090 4,796 36,525 28,935 Total liabilities 156,513 403,228 Total equity 186,566 98,738 Total liabilities and equity 343,079 501,966 The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements. 4 Consolidated Statements of Income (loss) (in thousands of U.S. dollars, excluding per share amounts) Nine-month periods ended November 30, November 30, November 30, November 30, 2025 2024 2025 2024 $ $ $ $ Sales 71,660 73,404 211,500 211,998 Cost of sales 44,483 45,099 148,022 146,911 Gross profit 27,177 28,305 63,478 65,087 Administration costs 16,457 17,003 50,147 48,348 Restructuring expenses (note 14) 1,305 74,468 7,369 81,301 Other expenses 3,565 (782) 3,520 (192) Operating income (loss) 5,850 (62,384) 2,442 (64,370) Financing expenses ( 259) (442) (893) (966) Income (loss) before income taxes 5,591 (62,826) 1,549 (65,336) Income tax expense (recovery) 2,655 (14,930) (17,483) (13,993) Net Income (loss) for the period from continuing operations 2,936 (47,896) 19,032 (51,343) Results from discontinued operations (note 6) - (14,262) 58,599 (11,890) 2,936 (62,158) 77,631 (63,233) Net Income (loss) attributable to: Subordinate Voting Shares and Multiple Voting Shares 2,996 (62,097) 77,761 (63,081) Non-controlling interest (60) (61) (130) (152) Net Income (loss) attributable to Shareholders for the period 2,936 (62,158) 77,631 (63,233) Net Income (loss) per Subordinate and Multiple Voting Share Basic and diluted from continuing operations 0.14 (2.22) 0.89 (2.37) Basic and diluted from discontinued operations - (0.66) 2.71 (0.55) Basic and diluted from all operations 0.14 (2.88) 3.60 (2.92) Dividends declared per Subordinate and Multiple (0.07) 0.02 (0 --- .38) 0.02 Voting Share (CA$ 0.10) (CA$ 0.03) (CA$ 0.53) (CA$ 0.03) ` Total weighted average number of Subordinate and Multiple Voting Shares Basic and diluted common number of shares 21,585,635 21,585,635 21,585,635 21,585,635 Net Income (loss) attributable to Shareholders: Continuing operations 2,936 (47,896) 19,032 (51,343) Discontinued operations - (14,262) 58,599 (11,890) Net Income (loss) for the period 2,936 (62,158) 77,631 (63,233) Three-month periods ended The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements. 5 Consolidated Statements of Comprehensive Income (loss) (in thousands of U.S. dollars) November 30, November 30, November 30, November 30, 2025 2024 2025 2024 $ $ $ $ Comprehensive Income (loss) Net Income (loss) for the period 2 936 (62 158) 77,631 (63,233) Other comprehensive Income (loss) Foreign currency translation of foreign subsidiaries 11,226 1 188 6,035 (740) Foreign currency translation of foreign subsidiaries from discontinued operations - (4 297) - (2,123) Reclassification of foreign currency translation from discontinued operations - - 12 456 - Comprehensive Income (loss) 14 162 (65,267) 96,122 (66,096) Comprehensive Income (loss) attributable to: Subordinate Voting Shares and Multiple Voting Shares 14,222 (65,206) 96,252 (65,944) Non-controlling interest (60) (61) (130) (152) Comprehensive Income (loss) 14 162 (65,267) 96,122 (66,096) Three-month periods ended Other comprehensive Income (loss) is composed solely of items that may be reclassified subsequently to the consolidated statement of Income (loss). The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements. Nine-month periods ended 6 Consolidated Statements of Changes in Equity (in thousands of U.S. dollars, excluding number of shares) Equity attributable to the Subordinate and Multiple Voting shareholders Share capital Contributed surplus Accumulated other comprehensive Income (loss) Retained earnings Total Non-controlling interest Total equity Balance - February 29, 2024 72,695 6,260 (38,692) 141,914 182,177 1,082 183,259 Net Loss for the period - - - (63,081) (63,081) (152) (63,233) Other comprehensive Income - - (2,863) - (2,863) - (2,863) Comprehensive Income (loss) - - (2,863) (63,081) (65,944) (152) (66,096) Other - 95 - - 95 - 95 Dividends Multiple Voting Shares - - - (333) (333) - (333) Subordinate Voting Shares - - - (129) (129) - (129) Balance - November 30, 2024 72,695 6,355 (41,555) 78,371 115,866 930 116,796 Balance - February 28, 2025 72,695 6,355 (47,141) 65,952 97,861 877 98,738 Net Income (loss) for the period - - - 77,761 77,761 (130) 77,631 Other comprehensive income (loss) - - 6,035 - 6,035 - 6,035 Comprehensive Income (loss) - - 6,035 77,761 83,796 (130) 83,666 Reclassification of foreign currency translation to discontinued operations (note 6) - - 12,456 - 12,456 - 12,456 Dividends Multiple Voting Shares - - - (5,980) (5,980) - (5,980) Subordinate Voting Shares - - - (2,314) (2,314) - (2,314) Balance - November 30, 2025 72,695 6,355 (28,650) 135,419 185,819 747 186,566 The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements. 7 Consolidated Statements of Cash Flow (in thousands of U.S. dollars) November 30, November 30, November 30, November 30, 2025 2024 2025 2024 $ $ $ $ Cash flows from Operating activities Net income (loss) for the period 2,936 (62,158) --- 77,631 (63,233) Less: results from discontinued operations (note 6) - 14,262 (58,599) 11,890 Net Income (loss) for the period for continued operations 2,936 (47,896) 19,032 (51,343) Adjustments to reconcile net loss to cash provided by operating activities (note 12) 5,188 45,240 (9,538) 54,424 Changes in non-cash working capital items (note 13) (15,804) 2,647 (50,679) 16,243 Cash provided (used) by operating activities from continued operations (excluding Asbestos settlement) (7,680) (9) (41,185) 19,324 Asbestos Settlement transaction (note 13) - - (143,553) - Cash provided (used) by operating activities from continued operations (7,680) (9) (184,738) 19,324 Investing activities Short-term investments - (193) (33) 472 Additions to property, plant and equipment (1,721) (4,039) (4,653) (7,860) Additions to intangible assets - (981) - (1,083) Proceeds on disposal of property, plant and equipment 25 31 1,158 177 Net change in other assets 26 258 13 (190) Cash provided (used) by investing activities from continued operations (excluding proceeds on disposal of France assets) (1,670) (4,923) (3,515) (8,484) Proceeds on disposal of France assets - - 182,363 - Cash provided (used) by investing activities from continued operations (1,670) (4,923) 178,848 (8,484) Financing activities Dividends paid to Subordinate and Multiple Voting shareholders (1,539) - (8,294) - Increase in long-term debt 2,168 506 3,311 1,090 Repayment of long-term debt (392) (242) (1,904) (6,753) Repayment of long-term lease liabilities (420) - (1,232) (425) Cash used by financing activities from continued operations (183) 264 (8,119) (6,088) Effect of exchange rate differences on cash and cash equivalents 279 (315) 1,868 26 Net change in cash during the period from continuated operations (9,254) (4,984) (12,141) 4,778 Net change in cash during the period from discontinuing operations (note 6) - 9,581 8,745 4,641 Net change in cash and cash equivalents during the period (9,254) 4,597 (3,396) 9,420 Net cash – Beginning of the period 29,477 37,045 32,364 27,283 Net cash – End of the period 20,223 32,061 20,223 32,061 Net cash is composed of: Cash and cash equivalents 36,320 35,051 36,320 35,051 Bank indebtedness (16,097) (2,990) (16,097) (2,990) Net cash – End of the period 20,223 32,061 20,223 32,061 Supplementary information Interest paid 320 (206) 42 (623) Income taxes paid (1,288) (3,618) (4,152) (8,389) Three-month periods ended Nine-month periods ended The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements. 8 NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS For the Nine-month period ended November 30, 2025 1 General information These unaudited condensed interim financial statements represent the consolidation of the accounts of Velan Inc. (the “Company”) and its subsidiaries. The Company is an international manufacturer of industrial valves and is a public company listed on the Toronto Stock Exchange under the symbol “VLN”. It was incorporated under the name Velan Engineering Ltd. on December 12, 1952 and continued under the Canada Business Corporations Act on February 11, 1977. It changed its name to Velan Inc. on February 20, 1981. Velan Inc. maintains its registered head office at 7007 Cote de Liesse, Montreal, Quebec, Canada, H4T 1G2. The Company’s controlling shareholder is Velan Holdings Co. Ltd. These unaudited condensed interim consolidated financial statements were approved for issue by t --- he Company’s Board of Directors on January 14, 2026. 2 Basis of preparation These unaudited condensed interim consolidated financial statements for the Nine-month period ended November 30, 2025 have been prepared in accordance with International Financial Reporting Standards (“IFRS”) in accordance with International Accounting Standard (“IAS”) 34, Interim Financial Reporting. These unaudited condensed interim consolidated financial statements have been prepared using the same basis of presentation, accounting policies, and methods of computation as outlined in Note 2, Summary of significant accounting policies, in the Company’s annual consolidated financial statements for the year ended February 28, 2025, which have also been prepared in accordance with IFRS. Accordingly, these unaudited condensed interim consolidated financial statements should be read in conjunction with the Company’s annual consolidated financial statements for the year ended February 28, 2025. 3 New accounting standards and amendments issued and adopted In May 2024, the IASB issued amendments to IFRS 7, Financial Instruments: Disclosures and IFRS 9, Financial Instruments, following the implementation review of the requirements of IFRS 9 and related requirements of IFRS 7. The IASB amended IFRS 9 to clarify the timing of recognition and derecognition of certain financial assets and liabilities, with a new exception for certain financial liabilities settled in cash through an electronic payment system, and to clarify and add additional guidance for assessing whether the cash flows associated with a financial asset consist solely of repayments of principal and interest payments on the outstanding principal. The IASB amended IFRS 7 to add new disclosures for certain instruments whose contractual terms may modify cash flows, and to improve the presentation of information about equity instruments designated at fair value through other comprehensive income. The Company is currently evaluating the impact of adopting the amendments to IFRS 7 and IFRS 9, which will be effective for fiscal years beginning on or after January 1, 2026. In April 2024, the IASB issued IFRS 18, Presentation and Disclosures in Financial Statements, which will replace the current IAS 1, Presentation of Financial Statements. IFRS 18 introduces three new elements designed to improve the presentation of information in financial statements. It introduces three new categories of revenue and expense (operating, investing, and financing) to improve the comparability of income statements between companies. In addition, IFRS 18 aims to improve the transparency of 9 performance indicators defined by management. Finally, IFRS 18 provides guidance on how to present information in financial statements. The Company is currently evaluating the impact of adopting IFRS 18, which will be applicable to fiscal years beginning on or after January 1, 2027. 4 Estimates The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing these unaudited condensed interim consolidated financial statements, the significant judgements made by management in applying the Company’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the annual consolida --- ted financial statements for the year ended February 28, 2025. 5 Seasonality The Company’s sales are not subject to seasonality. Quarterly sales can vary based on the timing of revenue recognition on large orders. 6 Disposal of Velan S.A.S. and Segault S.A.S. On March 31, 2025, the Company announced the closing of the sale of its French subsidiaries Velan S.A.S. and Segault S.A.S. (the disposal group) for a total consideration of €192,500 ($208,227), including the transfer of an intercompany loan of $24 millions, for a net cash consideration of $183,143 after related finance costs. Based on the net book value at the closing of the transaction and the related costs, a gain of $95,824 recorded in the previous quarter of fiscal year 2026. a) The assets and liabilities of the disposal group is as follows: As at March 31, 2025 (thousands) $ Cash and cash equivalents 25,063 Accounts receivable 47,700 Income taxes recoverable 1,042 Inventories 76,329 Deposits and prepaid expenses 2,104 Property, plant and equipment 16,319 Intangible assets and goodwill 8,960 Deferred income taxes (51) Assets held for sales 177,466 Accounts payable and accrued liabilities 24,057 Customer deposits 49,587 Provisions 3,707 Current portion of long-term lease liabilities 179 Current portion of long-term debt 1,129 Long-term lease liabilities 6,105 Long-term debt 2,717 10 Income taxes payable 861 Deferred income taxes 1,716 Other liabilities 89 Liabilities held for sales 90,147 Net Assets 87,319 Net consideration received in cash 183,143 Proft on disposal 95,824 b) The income and expenses, gains and losses relating to the discontinuation the disposal group have been subtracted from the Company's net income from continuing operations and are presented on a separate line in the consolidated statement of income. The result for the current period only covers one month due to the closing of the sale on March 31, 2025. The details of the elements making up this result are as follows: Three-month periods ended Nine-month periods ended November 30, 2025 November 30, 2024 November 30, 2025 November 30, 2024 (thousands) $ $ $ $ Sales - 23,381 4,764 60,934 Cost of sales - 14,728 3,127 38,583 Gross profit - 8,653 1,637 22,351 Administration costs - 5,241 1,782 15,852 Gain on Disposal of SAS and Segault - - (95,824) - Reclassification of foreign currency translation of foreign subsidiaries from discontinued operations - - 12,456 - Other expense (income) - 360 782 348 Operating income (loss) - 3,052 82,441 6,151 Finance costs – net - (60) (128) (118) Income (loss) before income taxes - 3,112 82,569 6,269 Income tax expense - 17,374 23,970 18,159 Net profit (loss) for the period - (14,262) 58,599 (11,890) 11 c) Cash flows generated by the disposal group for the reporting periods under review until its disposal are as follows: Three Month period ended Nine Month period ended November 30, 2025 November 30, 2024 November 30, 2025 November 30, 2024 (thousands) $ $ $ $ Operating activities - 8,429 (948) 3,582 Investing activities - 1,736 8,912 1,798 Financing activities - (648) 781 (931) Effect of exchange rate differences on cash and cash equivalents - 64 - 192 Net change in cash during the period from discontinuing operations - 9,581 8,745 4,641 7 Settlement of Asbestos liabilities Concurrently with the disposal of Velan S.A.S. and Segault S.A.S. (the disposal, note 6), the Company entered into an agreement to sell to an affiliate of Global Risk Capital its current and future exposure --- to Asbestos-related litigation in the United States. Part of the proceeds received in previous quarter from the Velan SAS and Segault SAS disposal was used on April 3, 2025, to pay an amount of $143 millions for the asbestos divestiture transaction. 8 Inventories As at (thousands) November 30, 2025 $ February 28, 2025 $ Raw materials 15,661 22,001 Work in process and finished parts 99,256 77,450 Finished goods 40,016 35,518 154,933 134,969 As a result of variations in the ageing of its inventories, the Company recognized a net reduction of inventory provision for the Nine-month period ended November 30, 2025, of $32 (February 28, 2025 – addition of $10,466), including reversals of $10,750 (February 28, 2025 - $6,180). 12 9 Long-term debt As at (thousands) November 30, 2025 $ February 28, 2025 $ Canadian subsidiary Secured bank loan ($CAD 17,909; February 28, 2025 - $CAD 18,460) 12,611 12,760 Italian subsidiary Unsecured bank loan (€832; February 28, 2025 - €1,631) 965 1,692 Unsecured state bank loan (€2,000; February 28, 2025 - €333) 2,319 346 Gulf subsidiary Unsecured third-party loan (SAR 1,200; February 28, 2025 – SAR 750) Other 320 1,474 200 1,205 17,689 16,203 Less: current portion 3,722 2,096 13,967 14,107 The Company reported that on May 21, 2025, it entered a new, $25 million, three-year, revolving credit facility (the “Credit Agreement”), the Credit Agreement also includes a $5M swing line and a $5M letter of credit facility. The Credit Agreement replaces the prior ABL agreement, dated as of February 28, 2025, which matured on the closing of the French and Asbestos transactions. The revolving credit facility may be used for general corporate purposes. The credit facility was funded and operational on June 25, 2025. The credit facility matures on May 21, 2028, and may be extended at maturity, subject to lender and borrower agreement. As at November 30, 2025, the Company had drawn down $3,830 (2025 - $Nil) on the revolving credit facility and had $29,948 (February 28, 2025 - $1,789) in the form of outstanding letters of credit and letters of guarantee on a total of $60,328 (February 28, 2025 - $35,316) borrowing availability. As at November 30, 2025, and as at February 28, 2025, the Company was in compliance of its financial covenants ratios. The next calculation for compliance of the covenant will be in February 2026. 10 Fair value of financial instruments The fair value hierarchy has the following levels: ? Level 1 – quoted market prices in active markets for identical assets or liabilities; ? Level 2 – inputs other than quoted market prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and ? Level 3 – unobservable inputs such as inputs for the asset or liability that are not based on observable market data. The level in the fair value hierarchy within which the fair value measurement is categorized in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. 13 The Company does not have any financial instruments measured and recognized at fair value that are material. For other financial instruments not recognized at fair value, their fair value is approximately the carrying amount as at November 30, 2025. 11 Segment reporting The Company reflects its results under a single reportable operating segment. The geographic distribution of its sales by origination country --- is as follows: Three-month period ended November 30, 2025 (thousands) Canada $ United States $ Europe $ Other $ Consolidation adjustment $ Consolidated $ Sales Customers - Domestic 7,316 21,641 12 3,923 - 32,892 Export 14,459 43 23,025 1,241 - 38,768 Intercompany (export) 9,007 1,593 349 20,300 (31,249) - 30,782 23,277 23,386 25,464 (31,249) 71,660 Three-month period ended November 30, 2024 (thousands) Canada $ United States $ Europe $ Other $ Consolidation adjustment $ Consolidated $ Sales Customers - Domestic 2,451 25,923 5,791 1,834 - 35,999 Export 13,899 116 10,798 12,592 - 37,405 Intercompany (export) 12,992 2,411 1 15,972 (31,376) - 29,342 28,450 16,590 30,398 (31,376) 73,404 Nine-month period ended November 30, 2025 (thousands) Canada $ United States $ Europe $ Other $ Consolidation adjustment $ Consolidated $ Sales Customers - Domestic 23,842 70,693 273 15,739 - 110,547 Export 30,082 220 65,681 4,970 - 100,953 Intercompany (export) 24,502 5,659 2,395 49,292 (81,848) - 78,426 76,572 68,349 70,001 (81,848) 211,500 14 Nine-month period ended November 30, 2024 (thousands) Canada $ United States $ Europe $ Other $ Consolidation adjustment $ Consolidated $ Sales Customers - Domestic 13,659 87,295 6,305 14,006 - 121,265 Export 25,812 694 40,993 23,234 - 90,733 Intercompany (export) 38,610 7,891 113 41,029 (87,643) - 78,081 95,880 47,411 78,269 (87,643) 211,998 The sales distribution by customer geographic location is as follows: Three-month period ended November 30, 2025 (thousands) Africa / Middle East $ Europe $ North America $ Asia / Pacific $ South & Central America $ Consolidated $ Sales 6,770 5,457 34,232 23,362 1,779 71,660 Three-month period ended November 30, 2024 (thousands) Africa / Middle East $ Europe $ North America $ Asia / Pacific $ South & Central America $ Consolidated $ Sales 103 (323) 40,350 32,195 1,079 73,404 Nine-month period ended November 30, 2025 (thousands) Africa / Middle East $ Europe $ North America $ Asia / Pacific $ South & Central America $ Consolidated $ Sales 13,523 16,025 107,097 70,069 4,786 211,500 Nine-month period ended November 30, 2024 (thousands) Africa / Middle East $ Europe $ North America $ Asia / Pacific $ South & Central America $ Consolidated $ Sales 21,083 19,212 120,124 49,002 2,577 211,998 15 12 Adjustments to reconcile net loss to cash provided (used) by operating activities Three-month period ended Nine-month period ended (thousands) November 30, 2025 $ November 30, 2024 $ November 30, 2025 $ November 30, 2024 $ Depreciation of property, plant and equipment 1,732 1,545 5,084 5,091 Amortization of intangible assets 595 570 1,655 1,558 Deferred income taxes - (16,714) (24,022) (16,551) Loss (gain) on disposal of property, plant and equipment - 25 25 157 Net change in long-term provisions - 58,176 - 55,989 Net change in customer deposits 2,388 738 8,030 8,431 Net change in derivative assets and liabilities 593 524 (605) 181 Net change in other liabilities (120) 376 295 (432) 5,188 45,240 (9,538) 54,424 13 Changes in non-cash working capital items Three-month period ended Nine-month period ended (thousands) November 30, 2025 $ November 30, 2024 $ November 30, 2025 $ November 30, 2024 $ Accounts receivable (11,564) 2,098 (12,856) 8,522 Inventories (17,680) (14,801) (17,329) (24,718) Income taxes recoverable 285 (70) 754 266 Deposits and prepaid expenses 100 954 (327) 1,588 Accounts payable and accrued liabilities 17,465 7,924 (4,843) 22,722 Income taxes payable (45) 1,178 (1,083) 1,310 C --- ustomer deposits (3,346) 4,766 (11,849) 3,725 Provisions (1,019) 598 (146,699) 2,828 (15,804) 2,647 (194,232) 16,243 16 14 Restructuring expenses Three-month period ended Nine-month period ended (thousands) November 30, 2025 $ November 30, 2024 $ November 30, 2025 $ November 30, 2024 $ Transaction-related costs 1,305 5,404 8,123 7,556 Asbestos-related costs - 69,064 (754) 73,745 1,305 74,468 7,369 81,301 15 Subsequent event On January 14, 2026, the Company announced that its controlling shareholder, Velan Holding Co. Ltd. (“Velan Holding”), the sole holder of the Company’s multiple voting shares, has agreed to sell its 15,566,567 multiple voting shares (representing approximately 72.1% of the Company’s outstanding shares and 92.8% of its aggregate voting rights) and one subordinate voting share to funds managed by Birch Hill Equity Partners Management Inc. (“Birch Hill”), at a price of C$13.10 per share, for aggregate gross proceeds of C$203,922,040.80 to Velan Holding and two other entities associated with shareholders of Velan Holding (the “VH Transaction”). Pursuant to a pre-closing reorganization, Velan Holding will, among other things, convert 2,290,075 multiple voting shares into the same number of subordinate voting shares. Therefore, giving effect to such pre-closing reorganization, 13,276,492 multiple voting shares and 2,290,076 subordinate voting shares will be sold to Birch Hill on closing of the VH Transaction (representing approximately 72.1% of the Company’s outstanding shares and 91.9% of its aggregate voting rights) (collectively the “VH Transaction Shares”). The VH Transaction is expected to close in the first half of 2026, subject to the receipt of the required regulatory approvals and other customary closing conditions. The completion of the VH Transaction is not subject to any financing condition or approval by the Company’s shareholders. The Company estimates that transaction related fees will be approximately $12 million, as well as additional change of control triggered costs of approximately $5 million relating mostly to the vesting and accelerated vesting of various incentive plans already in place at the time of the transaction. Of this total amount, $4 million has already been paid or accrued.