Velan Inc. — Proxy Solicitation & Information Statement 2025

Feb 27, 2025

VELAN INC.

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
to be held on March 20, 2025

NOTICE IS HEREBY GIVEN that a special meeting (the "Meeting") of the holders (the "Shareholders") of the subordinate voting shares (the "Subordinate Voting Shares") and the multiple voting shares (the "Multiple Voting Shares", and collectively with the Subordinate Voting Shares, the "Shares") of Velan Inc. (the "Company") will be held as a virtual-only meeting conducted by live audio webcast at https://meetings.lumiconnect.com/400-773-607-630 on March 20, 2025 at 10:00 a.m. (Montréal time) for the following purposes:

1. to consider and, if thought advisable, to pass, with or without variation, a special resolution (the "Special Resolution") approving the proposed sale by the Company's U.K. direct wholly-owned subsidiary, Velan Valves Limited, of its direct French wholly-owned subsidiaries (being the Company's indirect wholly-owned subsidiaries), Segault and Velan S.A.S. ("Velan France"), to Framatome SAS, for a purchase price of US$177.6 million (€170 million), with the benefit of the transfer by Velan France of an intercompany loan receivable from the Company of US$23.5 million (€22.5 million), for total consideration to the Company of US$201.1 million (€192.5 million) (the "France Transaction"), as outlined in the full text of the Special Resolution provided in Appendix B to the accompanying management information circular (the "Circular"); and
2. to transact such other business as may properly come before the Meeting or any postponement or adjournment thereof.

Specific details of the matters proposed to be put before the Meeting are set forth in the Circular which accompanies and is deemed to form part of this notice of Meeting (this "Notice of Meeting"). Among other considerations, the proceeds of the France Transaction are intended in part to finance the resolution of the Company's asbestos-related liabilities, through the divestiture of the Company's existing U.S. subsidiaries to an affiliate of Global Risk Capital LLC (the "Asbestos Purchaser"), at a cost to the Company of US$143 million (subject to certain adjustments), pursuant to the terms of a previously-announced share purchase agreement made as of January 14, 2025 among the Company, its U.S. wholly-owned subsidiary, Velan Valve Corp., and the Asbestos Purchaser (the "Asbestos Divestiture Transaction").

The France Transaction requires approval by not less than two-thirds of the votes cast at the Meeting by Shareholders virtually present or represented by proxy and entitled to vote at the Meeting (the "Required Shareholder Approval") pursuant to subsection 189(3) of the Canada Business Corporations Act (the "CBCA"). While it is required under the CBCA that the Meeting be held, the Required Shareholder Approval is already effectively secured, as Velan Holding Co. Ltd., the Company's controlling shareholder and the sole holder of the Multiple Voting Shares, representing approximately 72% of the total Shares issued and outstanding and of the aggregate voting rights attached to all of the Shares, has entered into a support and voting agreement pursuant to which it has agreed to vote all of its Shares in favour of the Special Resolution. Accordingly, subject to the entering into of the definitive share purchase agreement and the satisfaction of customary closing conditions, the France Transaction will proceed. Although the Asbestos Divestiture Transaction does not require Shareholder approval under the CBCA, it is discussed in this Notice of Meeting and the Circular due to its interconnectedness with the France Transaction.

To ensure that Shareholders will have an equal opportunity to participate in the Meeting regardless of geographic location, the Meeting will be held in a virtual-only format conducted by live audio webcast at https://meetings.lumiconnect.com/400-773-607-630, the password being "velan2025" (case sensitive). The virtual Meeting will be accessible online starting at 9:30 a.m. (Montréal time) on March 20, 2025. Shareholders will not be able to attend the Meeting in person.

Shareholders are entitled to vote at the Meeting either virtually or by proxy. Pursuant to the articles of the Company, since the approval of the France Transaction is required under subsection 189(3) of the

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CBCA, each Subordinate Voting Share and each Multiple Voting Share entitles the holder thereof to an equal number of votes at the Meeting and, as a result, each Subordinate Voting Share and each Multiple Voting Share entitles the holder thereof to five votes at the Meeting. The Board of Directors of the Company has fixed February 24, 2025 as the record date for determining Shareholders who are entitled to receive notice of and vote at the Meeting. Only Shareholders whose names have been entered in the register of the Company as at the close of business (Montréal time) on such date will be entitled to receive notice of and vote at the Meeting.

Whether or not you are able to virtually attend the Meeting, Shareholders are encouraged to vote as soon as possible electronically, by telephone, email or in writing, by following the instructions set out on the form of proxy or voting instruction form, as applicable, which accompanies this Notice of Meeting. Proxies must be received by the Company's transfer agent, TSX Trust Company (the "Transfer Agent"), at P.O. Box 721, Agincourt, Ontario, M1S 0A1, Attention: Proxy Department, or by email by sending your proxy to proxyvote@tmx.com, not later than 10:00 a.m. (Montréal time) on March 18, 2025 (or no later than 48 hours, excluding Saturdays, Sundays and holidays, before any reconvened meeting if the Meeting is adjourned or postponed). The deadline for the deposit of proxies may be waived or extended by the Chair of the Meeting at his discretion, without notice.

If you hold your Shares through a broker, investment dealer, bank, trust company or other intermediary (each, an "Intermediary") and received a voting instruction form from your Intermediary, Broadridge Financial Solutions Inc. ("Broadridge") or the Transfer Agent, you should follow the instructions in the voting instruction form to ensure your vote is counted at the Meeting.

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 Special Resolution.

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 the Transfer Agent 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 the Transfer Agent no later than 10:00 a.m. (Montréal time) on March 18, 2025 (or no later than 48 hours, excluding Saturdays, Sundays and holidays, before any reconvened meeting if the Meeting is adjourned or postponed), (ii) with the scrutineers of the Meeting, addressed to the attention of 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. If you attend the Meeting but do not vote by poll, your previously submitted proxy will remain valid.

A non-registered Shareholder who has given voting instructions in accordance with the voting instruction form may revoke such voting instructions by following the instructions. However, if the non-registered Shareholder is an objecting beneficial owner, the Intermediary or Broadridge from whom such Shareholder received the voting instruction form may be unable to take action on the revocation if such revocation is not provided sufficiently in advance of the Meeting or any adjournment or postponement thereof.

Registered Shareholders and duly appointed proxyholders, including non-registered Shareholders who have duly appointed themselves as proxyholders and registered their appointment with the Transfer Agent as described in the Circular, will be able to attend, ask questions and vote at the virtual Meeting.

Pursuant to the CBCA, registered Shareholders have the right to dissent in respect of the France Transaction and, if the France Transaction becomes effective, to be paid an amount equal to the fair value of their Shares. This dissent right, and the procedures for its exercise, are described in the Circular under "Information Concerning the Meeting – Dissent Rights of Shareholders". Failure to strictly comply with the dissent procedures described in the Circular will result in the loss or unavailability of any right to dissent. Persons who are beneficial owners of Shares registered in the name of an Intermediary who wish to dissent

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should be aware that only registered Shareholders are entitled to dissent. Accordingly, a beneficial owner of Shares desiring to exercise this right must make arrangements for the Shares beneficially owned by such Shareholder to be registered in the Shareholder's name prior to the time the written objection to the Special Resolution is required to be received by the Company or, alternatively, make arrangements for the registered holder of such Shares to exercise such right to dissent on the Shareholder's behalf. It is strongly suggested that any Shareholder wishing to dissent seek independent legal advice, as the failure to strictly comply with the provisions of the CBCA may result in the forfeiture of such Shareholder's right to dissent.

Dated at Montréal, Québec, this 19th day of February, 2025.

BY ORDER OF THE BOARD OF DIRECTORS OF VELAN INC.

(signed) “James A. Mannebach”

James A. Mannebach
Chairman of the Board of Directors

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