Neo Performance Materials Inc. — Capital/Financing Update 2021

Jan 26, 2021

January 25, 2021

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TERM SHEET

The Common Shares will be offered by way of a short form prospectus in all of the provinces of Canada other than Quebec. A preliminary short form prospectus containing important information relating to the Common Shares has not yet been filed with the applicable Canadian securities regulatory authorities. A copy of the preliminary short form prospectus is required to be delivered to any investor that received this term sheet and expressed an interest in acquiring the Common Shares. There will not be any sale or any acceptance of an offer to buy the Common Shares until a receipt for the final short form prospectus has been issued. This term sheet does not provide full disclosure of all material facts relating to the Common Shares. Investors should read the preliminary short form prospectus, final short form prospectus and any amendment, for disclosure of those facts, especially risk factors relating to the Common Shares, before making an investment decision.

Terms and Conditions

Issuer:	Neo Performance Materials Inc. (the “Company”).
Selling	OPPS NPM II S.à.r.l and OPPS NPM S.à.r.l (each, a “Selling Shareholder” and
Shareholders:	collectively, the “Selling Shareholders”).
Offering:	4,500,000 common shares (the "Common Shares") sold in aggregate by the
	Selling Shareholders (the “Offering”).
Offering Price:	$15.75 per Common Share.
Issue Amount:	$70,875,000.
Form of Offering:	Bought deal by way of a short form prospectus to be filed in all of the provinces of
	Canada other than Quebec (the “Jurisdictions”). Offering in such jurisdictions as
	the Company, the Selling Shareholders, and the Underwriters mutually agree
	provided that any offering or sale of Common Shares outside of the Jurisdictions
	does not give rise to any requirement on the part of the Company to file a
	prospectus, registration statement or offering memorandum or similar obligation,
	and does not impose any form of continuous disclosure obligations on the Company
	in such jurisdictions. Private placement offerings in the United States will be made
	to “qualified institutional buyers” pursuant to Rule 144A of the United States
	Securities Act of 1933.
Overallotment	The Selling Shareholders have granted the Underwriters an option to purchase that
Option:	number of additional Common Shares at the Offering Price equal to 15% of the
	base Offering Size, exercisable up to 30 days following the Closing Date.
Listing:	The outstanding common shares of the Company are listed on the Toronto Stock
	Exchange.
Use of Proceeds:	The Company will not receive any proceeds from the Offering. The net proceeds
	of the Offering will be payable to the Selling Shareholders.
Eligibility:	Eligible for RRSPs, RRIFs, RESPs, TFSAs, RDSPs and DPSPs.
Underwriters:	Paradigm Capital Inc., on behalf of a syndicate of underwriters (the
	“Underwriters”).
Standstill Period:	The Company will be subject to a 90-day standstill period, subject to certain
	exceptions.

95 Wellington Street West, Suite 2101, Toronto, Ontario M5J 2N7 Tel. (416) 361-9892

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Lock-Up Period: Each of the Selling Shareholders, Oaktree Capital Management, LP (" Oaktree ") and any other entity managed, controlled, associated or affiliated with the Selling Shareholders or Oaktree, will be subject to a 120-day lock-up period, subject to certain exceptions.

Cash Commission: Cash commission equal to 5% of the gross proceeds of the Offering. Closing: February 17, 2021 or such other date as the Underwriters, the Company and each of the Selling Shareholders may agree.

95 Wellington Street West, Suite 2101, Toronto, Ontario, Canada M5J 2N7 Tel. (416) 361-9892

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