Mr. Randy MacEwen reports

BALLARD INKS $25M DEAL WITH BROAD-OCEAN FOR FUEL CELL ENGINE MANUFACTURE & SALES IN CHINA

Ballard Power Systems Inc. has signed a definitive agreement relating to technology transfer, licensing and supply arrangements with strategic partner Zhongshan Broad-Ocean Motor Co. Ltd. for the assembly and sale of FCveloCity 30-kilowatt and 85 kw fuel cell engines in China. Under the deal, Broad-Ocean will manufacture fuel cell modules in three strategic regions in China, including Shanghai. The deal has an estimated value of approximately $25-million in revenue to Ballard over the initial five-year term, including $12-million in technology solutions revenue.

Randy MacEwen, Ballard president and chief executive officer, said: "Converging macrotrends in China, including large-scale urbanization, continued buildout of mass urban transportation, degrading air quality and a mandate to address climate change, together present an historic opportunity for zero-emission fuel cell solutions in the world's largest mobility market. Our strategic partnership with Broad-Ocean is a central piece in our China strategy, premised on the establishment of a comprehensive local fuel cell supply chain and related ecosystem to address the fast-growing clean energy bus and commercial vehicle markets.

"We are thrilled to have Broad-Ocean as a key partner to accelerate adoption of fuel-cell-powered heavy-duty vehicles in China. Ballard's fuel cell modules will be locally manufactured in key Chinese markets by Broad-Ocean, a highly regarded company that has manufacturing scale, supply chain muscle, operations excellence, relationships with government, and with bus and commercial vehicles original equipment manufacturers, and a strong balance sheet. Ballard will also benefit from Broad-Ocean's demand pull-through of fuel cell vehicles for use in its own new energy vehicle leasing business."

Charles Lu, founder and chairman of Broad-Ocean, added: "Hydrogen fuel cells are entering an exciting new growth phase in China and we intend to be at the forefront. We believe that this co-operation between Ballard and Broad-Ocean combines the strengths of both companies and will put us in a leading position in this new hydrogen fuel cell growth phase in China."

In each of the three assembly operation locations, Broad-Ocean plans to engage with local governments as well as with bus and commercial vehicle OEMs for deployment of fuel cell buses and commercial vehicles incorporating Ballard-designed modules manufactured by Broad-Ocean.

Broad-Ocean will make payments to Ballard at closing and, based on certain commissioning milestones, initial supply agreements and recurring royalty payments. Ballard will also have the exclusive right to purchase fuel cell engines from any of the Broad-Ocean manufacturing operations for sale outside China.

Each fuel cell engine assembled by Broad-Ocean will utilize FCvelocity-9SSL fuel cell stacks, initially manufactured by Ballard at its Vancouver HQ facility. Stack supply will be transferred to Guangdong Synergy Ballard Hydrogen Power Co., Ltd. (JVCo), the joint venture owned by Guangdong Nation Synergy Hydrogen Power Technology Co. Ltd. (Synergy) and Ballard in the city of Yunfu in China's Guangdong province, once JVCo becomes fully operational, expected in late 2017. From that time forward, Ballard will supply membrane electrode assemblies (MEAs) on an exclusive basis for stacks manufactured by JVCo.

This transaction is subject to customary closing conditions and is expected to close by second quarter 2017.

About Ballard Power Systems Inc.

Ballard Power Systems provides clean energy products that reduce customer costs and risks, and help customers solve difficult technical and business challenges in their fuel cell programs.

We seek Safe Harbor.