ARR Altius Renewable Royalities Corp

PenderFund Capital Management Ltd., as manager of the Pender Small Cap Opportunities Fund (together, “Pender” or “we”), directly or indirectly controls 1,209,184 common shares of Altius Renewable Royalties Corp. (TSX:ARR) (OTCQX:ATRWF) (the “Company”).

Further to its press release dated November 5, 2024, Pender re-affirms its intent to file a written objection and notice of dissent with respect to all of its common shares of the Company, and re-affirms its intent to vote all such shares “AGAINST” the Transaction. We urge fellow Minority Shareholders to vote AGAINST and exercise DISSENT rights with respect to the Transaction.

On November 11, 2024, Pender sent a letter to the Company’s legal advisor detailing its serious concerns regarding the process undertaken by the special committee, as described in the background to the Transaction in the Company’s management information circular dated October 18, 2024, including:

• the special committee did not engage independent legal counsel or explain why;
• the Company’s 58% controlling shareholder that is also the sole continuing shareholder in the Transaction (the “Continuing Shareholder”) was made aware of the Transaction within about three weeks of Northampton’s initial approach, calling into question the Continuing Shareholder’s influence on the special committee’s independence and its ability to properly discharge its fiduciary duties;
• the independent financial advisors to the special committee were engaged after the key terms of the Transaction had been largely negotiated among the special committee, Northampton and the Continuing Shareholder, including the consideration of $12 per minority share;
• other than the independent financial advisors engaged to prepare the formal valuation and fairness opinion required by securities laws, the special committee did not have the benefit of advice from financial advisors in evaluating Northampton’s offer or available alternatives thereto; and
• other than generic references to considering strategic alternatives which were undertaken without the engagement of a financial advisor and a one-week engagement between May 16 and 23, 2024 in respect of an unsolicited non-binding offer from a third-party to acquire the minority shares which was rejected by the special committee without the benefit of advice of a financial advisor, there was no meaningful market check for available alternatives.

We are alarmed by what appears to be a flawed process by the special committee who, as fiduciaries, are duty-bound to consider and protect the reasonable expectations of, among others, Minority Shareholders. Based on the extent of the Continuing Shareholder’s involvement, it appears that the special committee was more concerned with the Continuing Shareholder’s interests than those of Minority Shareholders.

We are also deeply troubled by the extent of the lock-up agreements entered into which render the upcoming special meeting to consider the Transaction meaningless. With approximately 81% of the outstanding Common Shares subject to such lock-up agreements, both the 66 and 2/3% approval and the minority approval (excluding the shares held by the Continuing Shareholder and other interested parties whose votes must be excluded under applicable securities laws) of the arrangement resolution are guaranteed to pass. We believe the Continuing Shareholder’s early support and involvement in the Transaction influenced other shareholders to enter into such lock-up agreements.

Based on the specific circumstances of the Transaction, practically, the extent of such lock-up agreements and a flawed process have resulted in the defeat of the fairness checks and balances enshrined in applicable corporate and securities laws for statutory arrangements and the deprivation of any meaningful protection for Minority Shareholders.

Accordingly, we urge fellow Minority Shareholders to vote AGAINST the Transaction by submitting a duly completed form of proxy by 1 pm (EST) on November 15, 2024 and to exercise DISSENT rights with respect to the Transaction by submitting a written objection by 4 pm (EST) on November 15, 2024. As only registered shareholders may submit a form of proxy or to exercise dissent rights, Minority Shareholders who hold their Common Shares in non-registered form should contact their brokers or intermediaries as soon as possible before such deadlines to ensure that their votes AGAINST and DISSENT in respect of the Transaction are timely voted and exercised.

We are seeking to engage the Company in constructive dialogue on behalf of all Minority Shareholders with the objective of resolving these serious concerns and ensuring that our investments in the Company are fairly valued.

AdvisorsPender has engaged Norton Rose Fulbright Canada LLP as legal advisor.

About PenderPender was founded in 2003 and is an independent, employee-owned investment firm located in Vancouver, British Columbia. Our goal is to protect and grow wealth for our investors over time. We have a talented investment team of expert analysts, security selectors and independent thinkers who actively manage our suite of differentiated investment funds, exploiting inefficient parts of the investing universe to achieve our goal.

For more information on Pender, visit www.penderfund.com and www.fondspender.com.

Please read important disclosures at www.penderfund.com/disclaimer.

For further information, please contact:Amar PandyaPortfolio Manager, PenderFund Capital Management Ltd.apandya@penderfund.com (604) 688-1511Toll Free: (866) 377-4743

Additional InformationThe information contained in this press release does not and is not meant to constitute a solicitation of a proxy within the meaning of applicable securities laws. Notwithstanding the foregoing, Pender is voluntarily providing the disclosure required under section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations and Alberta Securities Commission Blanket Order 51-520 in accordance with securities laws applicable to public broadcast solicitations.

Any solicitation made by Pender in advance of the special meeting to be held to consider the Transaction (the “Meeting”) is, or will be, as applicable, made by Pender, and not by or on behalf of management of the Company. All costs incurred for any solicitation will be borne by Pender, provided that, subject to applicable law, Pender may seek reimbursement from the Company for out-of-pocket expenses, including proxy solicitation expenses and legal fees.

Any proxies solicited by Pender may be solicited in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian corporate and securities laws, conveyed by way of public broadcast, including press release, speech or publication, and by any other manner permitted under applicable Canadian securities laws. In addition, solicitation may be made by mail, telephone, facsimile, email or other electronic means as well as by newspaper or other media advertising and in person by representatives of Pender in accordance with Canadian securities laws and regulations. All costs incurred for such solicitation will be borne by Pender. To the extent any dissent notices are solicited by Pender in connection with the Meeting, they may be revoked by a failure to follow the strict requirements provided for under law to exercise dissent rights, or in any other manner permitted by law or set out in the Circular.

Other than in respect of the Transaction, Pender does not, to its knowledge, or any of its associates or affiliates, have any material interest, direct or indirect, in any transaction since the commencement of the Company’s most recently completed financial year, or in any proposed transaction which has materially affected or will materially affect the Company or any of its subsidiaries. Pender does not, to its knowledge, or any of its associates or affiliates, have any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter to be acted upon at any upcoming shareholders meeting (including the Meeting), other than as set out herein.

Based upon publicly available information, the Company’s head office is located at 38 Duffy Pl. 2nd Floor, St Johns, Newfoundland and Labrador, A1B 4M5, Canada. A copy of this press release may be obtained on the Company's SEDAR+ profile at www.sedarplus.com.

Forward-looking Statements and Forward-looking Information This news release contains certain “forward-looking statements” within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as “expect” or “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. These statements are only predictions. Forward-looking statements are based on the opinions and estimates of the manager at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements.