Mr. Randy MacEwen reports

BALLARD ANNOUNCES ACQUISITION OF PROTONEX

Ballard Power Systems Inc. has signed a definitive agreement to acquire Protonex Technology Corp., a leading designer and manufacturer of advanced power management products and portable fuel cell solutions. As consideration for the transaction, valued at $30-million, Ballard is assuming and paying Protonex's debt obligations at closing, currently estimated at approximately $4.4-million, and paying the balance of approximately $25.6-million through the issuance of 11.2 million Ballard shares. The number of Ballard shares to be issued is subject to adjustment based on the final debt obligations at closing.

Founded in 2000, Protonex is a private company headquartered in Southborough, Mass., and currently has 53 employees and approximately 85 patents issued and pending in power management solutions, proton-exchange-membrane fuel cells, solid-oxide fuel cells and fuel reformer technology, which generate clean energy from readily available fuels such as propane, natural gas or diesel. In its last fiscal year ending Sept. 30, 2014, Protonex generated revenue of $13.8-million, with 40-per-cent gross margin and positive adjusted earnings before interest, taxes, depreciation and amortization.

"We continue to evolve Ballard's business model, including our recent implementation of a customer-centric sales and marketing strategy built on power products and technology solutions growth platforms," said Randy MacEwen, Ballard president and chief executive officer. "The acquisition of Protonex represents a complementary addition to our power products platform by delivering strategic benefits in four key areas -- diversification, growth, scale and profitability."

Expected benefits of the transaction include:

1. Diversification -- the deal adds power management capabilities along with small-scale portable products to Ballard's already extensive power products portfolio. Power management capability will enable Ballard to seamlessly link fuel cell, solar and storage technologies to deliver clean energy simply and efficiently. The transaction also provides exposure to military applications for power management products, as well as the opportunity to penetrate this vertical with fuel cell products in the longer term.
2. Growth -- the deal will enhance Ballard's overall growth profile as Protonex has enjoyed a compound annual growth rate in revenue of approximately 22 per cent since 2011 and is forecasting further significant growth in 2015 and 2016.
3. Scale -- Ballard's consolidated revenue will show a significant top-line improvement following the transaction.
4. Profitability -- Protonex generates high-margin revenue that will positively impact not only Ballard's top line but the bottom line as well, moving the company more rapidly toward positive earnings.

Dr. Paul Osenar, co-founder, president and chief executive officer of Protonex, added: "We are excited to join Ballard at this time of rapid growth in the clean energy industry. From the Protonex perspective, Ballard's strong brand, talented team and international sales capability position us to rapidly grow our business on Ballard's global platform."

Ballard expects the Protonex employee base and leadership team to remain intact, including Dr. Osenar, who is expected to continue in his current leadership role as president of Protonex.

The transaction is expected to close in the third quarter of 2015, subject to Protonex shareholder approval, regulatory approvals and customary closing conditions. The transaction requires approval of shareholders holding more than 50 per cent of the Protonex shares. Ballard has entered into support and voting agreements with each of the directors and executive officers of Protonex, as well as certain major shareholders of Protonex, who collectively hold more than 50 per cent of the currently outstanding shares of Protonex, under which those holders have irrevocably agreed to vote in favour of the transaction.

Cowen and Company is acting as financial adviser to Ballard. KPMG is acting as financial adviser to Protonex.

It should be noted that EBITDA measures net loss excluding finance expense; income taxes; depreciation of property, plant and equipment; amortization of intangible assets; and goodwill impairment charges. Adjusted EBITDA adjusts EBITDA for stock-based compensation expense, transactional gains and losses, asset impairment charges, finance, and other income and acquisition costs.

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