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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by the Registrantý

 Filed by a Party other than the Registranto

Check the appropriate box:

ý

 Preliminary Proxy Statement

o

 Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

o

 Definitive Proxy Statement

o

 Definitive Additional Materials

o

 Soliciting Material Pursuant to § 240.14a-12

QLTNOVELION THERAPEUTICS INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

ý

 No fee required

o

 

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11

 (1) Title of each class of securities to which transaction applies:

    

 (2) Aggregate number of securities to which transaction applies:

    

 (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

    

 (4) Proposed maximum aggregate value of transaction:

    

 (5) Total fee paid:

    

o

 Fee paid previously with preliminary materials.

o

 Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number of the Form or Schedule and the date of its filing.

 (1) Amount Previously Paid:

    

 (2) Form, Schedule or Registration Statement No.:

    

 (3) Filing Party:

    

 (4) Date Filed:

    

   


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PRELIMINARY PROXY STATEMENT DATED SEPTEMBER 20, 2019 — SUBJECT TO COMPLETION

LOGOLOGO

January 4, 2016[    ·    ], 2019

To the Shareholders of QLTNovelion Therapeutics Inc.

I am pleased to invite you to attend a special meetingthe Annual General Meeting (the "Special Meeting""Annual Meeting") of shareholders of QLTNovelion Therapeutics Inc. ("QLT"(the "Company" or "Novelion") to be held on Thursday, February 11, 2016November 5, 2019 at 10:00 AM (Pacific(Eastern Time)/1:7:00 PM (EasternAM (Pacific Time) at Suite 1800–510 West Georgia Street, Vancouver, British Columbia V6B 0M3.the offices of Goodwin Procter LLP, 100 Northern Avenue, Boston, Massachusetts 02210.

The board of directors of the Company (the "Board") has called the Annual Meeting in order to seek your approval of, among other things, (i) the voluntary liquidation and dissolution of the Company pursuant to the Business Corporations Act (British Columbia) (the "BCBCA") at a time to be determined by the Board, (ii) the Company's plan of liquidation and distribution substantially in the form attached to the accompanying Proxy Statement as Schedule A (the "Liquidation Plan") and (iii) one or more distributions to shareholders of any remaining property of the Company under the voluntary liquidation and dissolution each as more particularly described in the accompanying Proxy Statement (together, the "Liquidation Matters").

At the Annual Meeting, you will be asked to:

Consider and vote upon a proposal to approve as a special resolution the Liquidation Matters (the "Liquidation Resolution").

Consider and vote upon a proposal to approve as an ordinary resolution: (i) the appointment of Alvarez & Marsal Canada Inc. as the liquidator of the Company pursuant to Section 319(2)(a) of the BCBCA (the "Liquidator"); and (ii) the authorization of the Board to set the remuneration of the Liquidator (the "Liquidator Resolution").

Consider and vote upon a proposal to elect three directors to hold office until the next annual general meeting of shareholders of Novelion and until their successors are duly elected and qualified, subject to their earlier resignation or removal, or earlier in accordance with the Liquidation Plan.

Consider and conduct an advisory (non-binding) vote to approve the compensation of our named executive officers.

Consider and vote upon a proposal to appoint Deloitte & Touche LLP as the independent registered public accounting firm of Novelion for the fiscal year ending December 31, 2019.

Transact such other business as may properly come before the Annual Meeting, or at any adjournments or postponements thereof.

The Board has unanimously approved each of these proposals and recommends that you vote "FOR" each of the proposals described in the Notice of SpecialAnnual Meeting and the Proxy Statement.


Background

On May 20, 2019, the Company, Aegerion Pharmaceuticals, Inc. ("Aegerion"), a subsidiary of the Company, Dublin-based Amryt Pharma Plc ("Amryt") and certain other parties entered into a restructuring support agreement, and Aegerion and Amryt entered into a plan funding agreement, which, among other things, set forth the terms and conditions of Amryt's acquisition of 100% of the outstanding equity interests of reorganized Aegerion, pursuant to which Aegerion will become a wholly-owned subsidiary of Amryt (the "Aegerion Recapitalization"). To facilitate the Aegerion Recapitalization, Aegerion and its U.S. subsidiary Aegerion Pharmaceuticals Holdings, Inc. filed voluntary petitions under Chapter 11 of Title 11 of the United States Code (the "Chapter 11 Proceedings") in the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court"). Under the chapter 11 plan, which was confirmed by the Bankruptcy Court on September 10, 2019, the Company's existing approximately $36 million intercompany secured loan to Aegerion


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will be allowed in full as a claim in the Chapter 11 Proceedings. In satisfaction of this claim, the Company will receive a distribution of Amryt equity under the Aegerion Recapitalization, which is projected to represent approximately 8.1% equity ownership of Amryt on a pro forma basis, prior to dilution from other equity interests to be issued following the Aegerion Recapitalization (the "Amryt Equity"). The Aegerion Recapitalization is expected to close on [    ·    ], 2019. See "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —General" and "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Background of the Transactions and Discussions Preceding the Proposed Liquidation" each beginning on page 28 of the accompanying Proxy Statement provide detailsfor more information regarding the Aegerion Recapitalization. Following the completion of the Aegerion Recapitalization, the Amryt Equity will be the only remaining material asset of Novelion and any distributions made to shareholders in connection with the Liquidation Matters will consist almost entirely of the Amryt Equity, any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation Matters, or a combination thereof, net of the Company's liabilities.

In furtherance of the Company's duty to maximize value for the Company's shareholders and stakeholders, after reviewing the limited strategic alternatives reasonably available to the Company and considering that the Company will cease to have any ongoing business operations or sources of revenue upon the consummation of the Aegerion Recapitalization, the Board has determined that it is in the best interests of the Company and its shareholders to liquidate, wind-up and dissolve the Company pursuant to the Liquidation Plan. The Board has unanimously approved the Liquidation Matters, pending shareholder approval. Accordingly, the Board unanimously recommends that the Company's shareholders vote "FOR" the approval of the Liquidation Matters.

Given that the Company currently expects that the liquidation distributions will consist almost entirely of the Amryt Equity (which is publicly traded), any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation Matters, or a combination thereof, net of the Company's liabilities, the Company cannot predict with certainty the value of any liquidation distributions to its shareholders. Accordingly, you will not know the amount of any liquidation distributions you may receive as a result of the Liquidation Plan when you vote on the Liquidation Resolution. Many of the factors influencing the value of the liquidation distributions cannot currently be quantified with certainty and are subject to change, including the amount of cash the Company will need to fund the liquidation, the amount of Amryt Equity that will need to be conductedsold by the Company in connection with such funding and the proceeds received therefrom, and the value of the Amryt Equity, which is dependent upon the business operations and financial success of Amryt and is subject to market fluctuations and volatility among other risks over which we have no control. The Company cannot determine at this time when, or potentially whether, it will be able to make any liquidation distributions to the Special Meeting. Company's shareholders or the value of any such distributions. Shareholders may receive substantially less than the value that they expect to receive. See "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The NoticeCompany cannot assure shareholders of Special Meetingthe timing or amount of any liquidation distributions" and "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The value of the Amryt Equity and/or the amount of proceeds that might be realized from the sale of any of the Amryt Equity (if any), which is the Company's primary asset, is subject to fluctuation in the market prices of such Amryt Equity and the Company's ability to monetize such Amryt Equity on favorable terms, in a timely manner or at all." beginning on pages 24 and 26 of the accompanying Proxy Statement, and the Instrument of Proxy (or voting information form) are first being mailed to shareholders on or about January 12, 2016. The Annual Report on Form 10-K was previously mailed to shareholders on May 12, 2015.respectively.

Your vote is very important to us.    Approval of the Liquidation Resolution requires the affirmative vote, in person or by proxy, of two-thirds of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting. Approval of the Liquidator Resolution requires the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting. We cannot complete the liquidation and dissolution of the Company pursuant to the Liquidation Plan unless the Liquidation Resolution and the Liquidator Resolution are approved by our shareholders. Whether or not you plan to attend our Specialthe Annual Meeting, please communicate your vote in accordance with the instructions in the Proxy Statement and the enclosed Instrument of Proxy (or voting information form).

Novelion does not have sufficient resources, operations or assets to continue as a stand-alone operating company. If the Liquidation Resolution and the Liquidator Resolution are not approved, the future of Novelion will be uncertain, and any realization of value for your Novelion shares will likely be significantly delayed or you may not


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realize any value for your Novelion shares. If the Liquidation Resolution and the Liquidator Resolution are not approved, the Company may apply to court for an order that a liquidator be appointed and that the Company be liquidated, wound up and dissolved.

You are encouraged to review carefully the accompanying Proxy Statement, as it explains the reasons for the proposals to be voted on at the Annual Meeting and contains other important information, including a copy of the Liquidation Plan, which is attached as Schedule A to the accompanying Proxy Statement. In particular, please review the matters referred to under "Risk Factors" beginning on page 24 of the accompanying Proxy Statement for a discussion of the risks related to the Liquidation Resolution.

The Notice of Annual Meeting and Proxy Statement and the Instrument of Proxy (or voting information form) are first being mailed or made available to shareholders on or about [    ·    ], 2019.

Thank you for your continued support of QLT and I look forward to seeing you at the Special Meeting on February 11, 2016.Novelion.

Sincerely,

QLT
Novelion Therapeutics Inc.

GRAPHIC



Dr. Geoffrey F. Cox
Interim Chief Executive Officer

Ben Harshbarger
Interim Chief Executive Officer & General Counsel


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PRELIMINARY PROXY STATEMENT DATED SEPTEMBER 20, 2019 — SUBJECT TO COMPLETION

QLT Novelion Therapeutics Inc.
887 Great Northern Way, Suite 250c/o Norton Rose Fulbright
1800 — 510 West Georgia Street, Vancouver, British Columbia, V5T 4T5BC V6B 0M3 Canada

Notice of SpecialAnnual General Meeting of Shareholders to be held on February 11, 2016November 5, 2019

1.
To approve as a reorganizationspecial resolution: (i) the voluntary liquidation and dissolution of QLT's share capitalthe Company pursuant to a statutory plan of arrangement under Section 288 of theBusiness Corporations Act (British Columbia) (the "BCBCA") at a time to be determined by the board of directors of the Company (the "Board"); (ii) the plan of liquidation and distribution substantially in the form attached to the accompanying Proxy Statement as Schedule A (the "Liquidation Plan"); and (iii) one or more distributions to shareholders of any remaining property of the Company under the voluntary liquidation and dissolution each as more particularly described in the accompanying Proxy Statement (together, the "Liquidation Resolution").

2.
To approve as an ordinary resolution: (i) the appointment of Alvarez & Marsal Canada Inc. as the liquidator of the Company pursuant to Section 319(2)(a) of the BCBCA (the "Liquidator"); and (ii) the authorization of the Board to set the remuneration of the Liquidator (the "Liquidator Resolution").

3.
To elect three directors to hold office until the next annual general meeting of shareholders of Novelion and until their successors are duly elected and qualified, subject to their earlier resignation or removal, or earlier in accordance with the Liquidation Plan (the "Election of Directors Proposal").

4.
To approve on a non-binding, advisory basis the compensation of our named executive officers (the "Advisory Compensation Proposal").

5.
To appoint Deloitte & Touche LLP as the independent registered public accounting firm of Novelion for the fiscal year ending December 31, 2019 and authorizing the Board to fix their remuneration (the "Appointment of Independent Auditors Proposal").

6.
To transact such other business as may properly come before the SpecialAnnual Meeting, or at any adjournments or postponements thereof.

7.
To receive the Annual Report on Form 10-K (as amended), and the Audited Consolidated Financial Statements of Novelion for the year ended December 31, 2018, together with the Report of the Independent Registered Public Accounting Firm on those Financial Statements.

The Board has unanimously approved each of the proposals and recommends that you vote "FOR" the Liquidation Resolution, "FOR" the Liquidator Resolution, "FOR" the Election of Directors Proposal, "FOR" the Advisory Compensation Proposal and "FOR" the Appointment of Independent Auditors Proposal. Information about each of the proposals is included in the accompanying Proxy Statement.We urge you to read this material carefully. A copy of the Liquidation Plan is attached as Schedule A to the accompanying Proxy Statement.

Approval of the Liquidation Resolution requires the affirmative vote, in person or by proxy, of two-thirds of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting. Approval of the Liquidator Resolution, the Advisory Compensation Proposal and the Appointment of Independent Auditors Proposal each requires the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting.

For the Election of Directors Proposal, under the BCBCA and the Articles of Novelion, directors are entitled to be elected by a plurality of the common shares voted at the Annual Meeting. This means that the three nominees with the most votes for election will be elected, subject to the requirements of Novelion's majority voting policy, which applies for elections of directors at uncontested shareholders' meetings. Pursuant to this policy, any nominee for director for which there are a greater number of votes


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The enclosed Instrument of Proxy is solicited by ourthe Board of Directors and management, but you may amend it if you wish by striking out the names listed in the Instrument of Proxy and inserting in the space provided the name of the person you wish to represent you at the SpecialAnnual Meeting.


We encourage you to read the Proxy Statement in its entirety.

Your vote is very important.

DATED at Vancouver, British Columbia, this 4th[    ·    ] day of January, 2016.[    ·    ] 2019.


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BY ORDER OF THE BOARD OF DIRECTORS



GRAPHIC

Dr. Geoffrey F. CoxBen Harshbarger
Interim Chief Executive Officer & General Counsel


Whether or not you plan to attend the SpecialAnnual Meeting, please communicate your vote in accordance with the instructions in the Proxy Statement and the enclosed Instrument of Proxy (or voting information form) as soon as possible. If you are able to attend the SpecialAnnual Meeting and wish to vote your shares in person, you may do so at any time before the proxy is exercised.



Important Notice Regarding the Availability of Proxy Materials

This Proxy Statement and our Annual Report for the fiscal year ended December 31, 20142018 are available atwww.qltinc.comhttp://ir.novelion.com/financial-information/annual-reports by clicking on "2016 Proxy Materials for Special Meeting and Annual Report" or directly at:http://phx.corporate-ir.net/phoenix.zhtml?c=67181&p=irol-proxy.


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 Page 

QUESTIONS AND ANSWERS ABOUT THIS PROXY STATEMENT AND OUR SPECIALANNUAL MEETING

1

WHY DID I RECEIVE THIS PROXY STATEMENT?

1

CAN I ACCESS THE PROXY MATERIALS ON THE INTERNET?

1

WHAT IS THE DATE, TIME AND PLACE OF THE SPECIAL MEETING?

  2 

WHO IS ENTITLED TO VOTE AT THE SPECIAL MEETING?SUMMARY

  2

WHAT AM I VOTING ON AT THE SPECIAL MEETING?

2

HOW DOES THE BOARD RECOMMEND THAT I VOTE?

2

WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL?

2

WHO MAY ATTEND THE SPECIAL MEETING?

2

WHAT IS THE QUORUM FOR THE SPECIAL MEETING?

3

HOW DO I VOTE?

3

HOW WILL PROXIES BE EXERCISED?

4

WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE SET OF PROXY MATERIALS?

5

CAN I CHANGE MY VOTE AFTER I HAVE VOTED?

5

WHO WILL TABULATE THE VOTES?

5

WHO PAYS THE COST OF THE PROXY SOLICITATION?

5

HOW CAN SHAREHOLDERS SUBMIT PROPOSALS FOR QLT'S NEXT ANNUAL GENERAL MEETING?

5
15
 

CAUTIONARY NOTESTATEMENT REGARDING FORWARD LOOKING STATEMENTSINFORMATION

  
23

6RISK FACTORS


24

PROPOSAL NO. 1: APPROVAL OF LIQUIDATION RESOLUTION AND PROPOSAL NO. 2: APPROVAL OF LIQUIDATOR RESOLUTION


28

PROPOSAL NO. 3: ELECTION OF DIRECTORS


50

CORPORATE GOVERNANCE


53

COMPENSATION OF DIRECTORS


62

EXECUTIVE OFFICERS


65
 

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

  6
66
 

APPROVAL OF A REORGANIZATION OF SHARE CAPITAL PURSUANT TO AN ARRANGEMENTEXECUTIVE COMPENSATION

  8
69
 

CANADIAN FEDERAL INCOME TAX CONSEQUENCESSECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

  11
77
 

CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCESPROPOSAL NO. 4: ADVISORY COMPENSATION PROPOSAL

  17
78
 

INTERESTINDEBTEDNESS OF CERTAIN PERSONS IN MATERIAL TRANSACTIONSDIRECTORS AND EXECUTIVE OFFICERS

  
79

24REPORT OF THE AUDIT COMMITTEE


79

PROPOSAL NO. 5: APPROVAL OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


80

PROCEDURES AND TRANSACTIONS WITH RELATED PERSONS


82
 

AUDITED CONSOLIDATED FINANCIAL STATEMENTS AND ADDITIONAL INFORMATION

  25
84
 

DOCUMENTS INCORPORATED BY REFERENCESECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

  25
84
 

OTHER BUSINESS

  26
84
 

APPENDIX "A" —SCHEDULE A PLAN OF ARRANGEMENTLIQUIDATION AND DISTRIBUTION

  A-1

APPENDIX "B" — INTERIM ORDER

B-1

APPENDIX "C" — REQUISITION FOR FINAL HEARING

C-1
85
 

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QLTPRELIMINARY PROXY STATEMENT DATED SEPTEMBER 20, 2019 — SUBJECT TO COMPLETION

NOVELION THERAPEUTICS INC.
887 Great Northern Way, Suite 250c/o Norton Rose Fulbright
1800 — 510 West Georgia Street, Vancouver, British Columbia, V5T 4T5BC V6B 0M3 Canada

PROXY STATEMENT FOR
SPECIALANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 11, 2016November 5, 2019

        We are providing you this Notice of SpecialAnnual General Meeting and Proxy Statement (the "Proxy Statement"), together with the enclosed Instrument of Proxy, because our Board of Directors and managementwe are soliciting your proxy to vote at the Specialour Annual General Meeting (the "Annual Meeting") of shareholders to be held on February 11, 2016 (the "Special Meeting").November 5, 2019 at 10:00 AM (Eastern Time)/7:00 AM (Pacific Time) at the offices of Goodwin Procter LLP, 100 Northern Avenue, Boston, Massachusetts 02210. This Proxy Statement contains information about the matters being voted on at the SpecialAnnual Meeting and important information about QLT.Novelion. Unless otherwise stated, information in this Proxy Statement is given as of January 4, 2016.September 13, 2019. As many of our shareholders are expected to be unable to attend the SpecialAnnual Meeting in person, proxies are solicited, to give each shareholder an opportunity to vote on all matters that will properly come before the SpecialAnnual Meeting. QLTNovelion intends to mail this Proxy Statement and accompanying Instrument of Proxy or voting information form ("VIF"VIF"), as applicable, on or about January 12, 2016[    ·    ], 2019 to all shareholders of record as of the close of business on January 4, 2016,September 13, 2019, which we refer to as the "record date."

        We use a number of abbreviations in this Proxy Statement. We refer to QLTNovelion Therapeutics Inc. as "QLT""Novelion" or "the Company," "we," "us" or "our" and to our board of directors as the "Board" or the "Board of Directors." The term "proxy solicitation materials" includes this Proxy Statement and the enclosed Instrument of Proxy or VIF, as applicable. References to "2014" and "2015" mean our 2014 fiscal year which began on January 1, 2014 and ended on December 31, 2014 and our 2015 fiscal year which began on January 1, 2015 and ended on December 31, 2015, respectively. Our SpecialAnnual General Meeting of Shareholdersshareholders to be held on Thursday, February 11, 2016November 5, 2019 is referred to as the "Special"Annual Meeting" or the "Meeting." References in this Proxy Statement to the SpecialAnnual Meeting include any adjournment or postponement of the SpecialAnnual Meeting.

        EnclosedOn May 20, 2019, the Company, Aegerion Pharmaceuticals, Inc. ("Aegerion"), a subsidiary of the Company, Dublin-based Amryt Pharma Plc ("Amryt") and certain other parties entered into a restructuring support agreement, and Aegerion and Amryt entered into a plan funding agreement, which, among other things, set forth the terms and conditions of Amryt's acquisition of 100% of the outstanding equity interests of reorganized Aegerion, pursuant to which Aegerion will become a wholly-owned subsidiary of Amryt (the "Aegerion Recapitalization"). To facilitate the Aegerion Recapitalization, Aegerion and its U.S. subsidiary Aegerion Pharmaceuticals Holdings, Inc. filed voluntary petitions under Chapter 11 of Title 11 of the United States Code (the "Chapter 11 Proceedings") in the mailingUnited States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court"). Under the chapter 11 plan, which was confirmed by the Bankruptcy Court on September 10, 2019, the Company's existing approximately $36 million intercompany secured loan to Aegerion will be allowed in full as a claim in the Chapter 11 Proceedings. In satisfaction of this claim, the Company will receive a distribution of Amryt equity under the Aegerion Recapitalization, which is projected to represent approximately 8.1% equity ownership of Amryt on a pro forma basis, prior to dilution from other equity interests to be issued following the Aegerion Recapitalization (the "Amryt Equity"). The Aegerion Recapitalization is expected to close on [    ·    ], 2019. See "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —General" and "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Background of the Transactions and Discussions Preceding the Proposed Liquidation" each beginning on page 28 of this Proxy Statement is a copy of a prospectus (the "Aralez Prospectus") of Aralez Pharmaceuticals Inc. ("Aralez") relating tofor more information regarding the common shares of Aralez (the "Aralez Shares") that QLT intends to distribute to its shareholders pursuant toAegerion Recapitalization. Following the Special Distribution (as defined below). The Aralez Prospectus includes a detailed descriptioncompletion of the Aralez SharesAegerion Recapitalization, the Amryt Equity will be the only remaining material asset of Novelion and material informationany distributions made to shareholders in connection with respect to Aralez. In addition tothe matters described in this Proxy Statement we encourage youwill consist almost entirely of the Amryt Equity, any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to readfund the enclosed Aralez Prospectus in its entirety.Company's expenses, including expenses of the liquidation, winding up and dissolution of the Company, or a combination thereof, net of the Company's liabilities.


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QUESTIONS AND ANSWERS ABOUT THIS PROXY STATEMENT
AND OUR SPECIALANNUAL MEETING

Annual Meeting

What is the date, time and place of the Annual Meeting?

        The Annual Meeting will be held at the offices of Goodwin Procter LLP, 100 Northern Avenue, Boston, Massachusetts 02210, on November 5, 2019 at 10:00 AM (Eastern Time)/7:00 AM (Pacific Time).


Why did I receive this Proxy Statement?

        You are receiving these proxy solicitation materials from us because you owned common shares of QLTNovelion at the close of business on the record date. When you vote using the Instrument of Proxy, you appoint Mr. Jason M. AryehBenjamin Harshbarger or, failing him, Dr. Geoffrey Cox,Michael Price, as your representative at the SpecialAnnual Meeting. Mr. Aryeh and Dr. CoxBenjamin Harshbarger or Michael Price (or their appointees) will vote your shares at the SpecialAnnual Meeting as you have instructed them on the Instrument of Proxy. This way, your shares will be voted whether or not you attend the SpecialAnnual Meeting. Even if you plan to attend the SpecialAnnual Meeting, it is a good idea towe recommend that you vote by proxy in advance of the SpecialAnnual Meeting in case your plans change.You have the right to appoint another person or company to attend and act on your behalf at the SpecialAnnual Meeting other than the persons named in the enclosed Instrument of Proxy. To exercise this right, you should strike out the names of the persons named in the Instrument of Proxy and insert the name of your nominee in the blank space provided. A person appointed as a proxy holder need not be a shareholder of QLT.Novelion.


Can I access the proxy materials on the Internet?

        Yes. This Proxy Statement isand our Annual Report for the fiscal year ended December 31, 2018 are available athttp://ir.novelion.com/financial-information/annual-reports. This Proxy Statement and Annual Report on Form 10-K for the year ended December 31, 2018 (as amended) are also available on our website atwww.qltinc.com by clicking "2016 Proxy Materials for Special Meeting and Annual Report" or directly at:http://phx.corporate-ir.net/phoenix.zhtml?c=67181&p=irol-proxy.


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What is the date, time and place of the Special Meeting?

        The Special Meeting will be held at Suite 1800–510 West Georgia Street, Vancouver, British Columbia V6B 0M3, on Thursday, February 11, 2016 at 10:00 AM (Pacific Time)/1:00 PM (Eastern Time).


Who is entitled to vote at the Special Meeting?

        Only shareholders of record at the close of businessNovelion's profile on the record date may vote at the Special Meeting. On a show of hands every shareholder present in person has one vote,SEDAR website (www.sedar.com) and on a poll every shareholder present in person or by proxy has one vote, for each QLT common share registered in such shareholder's name. There are no other classes of voting securities other than the common shares. Cumulative voting is not permitted.EDGAR website (www.sec.gov).


What am I voting on at the SpecialAnnual Meeting?

        At the SpecialAnnual Meeting, shareholders will be asked to approveconsider and vote on the following proposals:


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What

        The Instrument of Proxy confers upon the proxy holder discretionary authority to vote is required to approve each proposal?

        Broker Non-Votes and Abstentions.    Commonall shares that are represented by "broker non-votes" (i.e., common shares held by a bank, broker or other holder of record holding shares for a beneficial owner that are represented at the Special Meeting butproxy with respect to whichamendments or variations to matters identified in the bank, brokerNotice of Meeting and any other matter that properly comes before the Annual Meeting. We know of no such amendment, variation or other matter that is to be presented for action at the Annual Meeting. However, if any other matters which are not now known to us should properly come before the Annual Meeting, the proxies will be voted, or not voted, by the proxy holder of record isin his or her discretion, whether or not empowered to vote on a particular proposal) and common shares held by holders who abstain from voting (or vote "withhold") on any matter will have no effect on the legal outcome of the matter, but are included for quorum purposes.We encourage all shareholders that hold shares through a bank, brokeramendment, variation or other holder of record to provide voting instructions to such parties well in advance ofmatter that comes before the SpecialAnnual Meeting to ensure that their shares are voted at the Special Meeting.

        Approval of Reorganization of Share Capital.    The proposed Reorganization of Share Capital will require the affirmative vote of two-thirds of the common shares voted at the Special Meeting for approval.is contested.


Who may attend the SpecialAnnual Meeting?

        All QLT        Novelion shareholders are invited to attend the SpecialAnnual Meeting, including shareholders whose shares are held by their brokerage firm or another similar organization, or who otherwise do not hold their common shares in their own name (referred to herein as "Beneficial Shareholders""Beneficial Shareholders"). Beneficial Shareholders fall into two categories — those who object to their identity being known to the issuers of securities which they own ("OBOs"OBOs") and those who do not object to their identity being made known to the issuers of the securities which they own ("NOBOs"NOBOs"). Beneficial Shareholders should note that only proxies deposited by shareholders who appear on the records maintained by QLT'sNovelion's registrar and transfer agent as registered holders of common shares will be recognized for the purposes of attending and voting at the SpecialAnnual Meeting. If common shares are listed in an account statement provided to a Beneficial Shareholder by a broker, then those common shares will, in all likelihood, not be registered in the shareholder's name. Such common shares will more likely be registered under the name of the shareholder's broker or an agent of that broker. Without specific instructions, brokers and their agents and nominees are prohibited from voting shares for the broker's clients.clients on non-routine matters. Therefore, each


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Beneficial Shareholder should ensure that voting instructions are communicated to the appropriate person well in advance of the SpecialAnnual Meeting.

        Although a Beneficial Shareholder may not be recognized directly at the SpecialAnnual Meeting for the purposes of voting common shares registered in the name of such shareholders' broker, a Beneficial Shareholder may attend the SpecialAnnual Meeting as proxyholderproxy holder for the registered shareholder and vote the common shares in that capacity. A Beneficial Shareholder who wishes to attend the SpecialAnnual Meeting and to vote their common shares as proxyholderproxy holder for the registered shareholder, should enter their own name in the blank space on the VIF and return the same to their broker (or the broker's agent) in accordance with the instructions provided by such broker. Alternatively, National Instrument 54-101 —Communication with Beneficial Owners of Securities of a Reporting Issuer ("NI 54-101"54-101") allows a Beneficial Shareholder to submit to the applicable intermediary any document in writing that requests that the Beneficial Shareholder, or a nominee of the Beneficial Shareholder, be appointed as proxyholder. If such a request is received, the applicable intermediary must arrange, without expense to the Beneficial Shareholder, to appoint such Beneficial Shareholder or its nominee as a proxyholderproxy holder and to deposit that proxy within the time specified in this Proxy Statement, provided that the intermediary receives such written instructions from the Beneficial Shareholder at least one business day prior to the time by which proxies are to be submitted at the SpecialAnnual Meeting, with the result that such a written request must be received by 10:00 AM (Pacific(Eastern Time)/1:7:00 PM (EasternAM (Pacific Time) on the day which is at least threetwo business days prior to the SpecialAnnual Meeting.

Liquidation Resolution and Liquidation Plan

What does the Liquidation Plan entail?

        The Liquidation Plan provides for the voluntary liquidation, dissolution and winding up of the Company. Pursuant to the Liquidation Plan, the Liquidator will be appointed as the liquidator of the estate and effects of the Company for the purpose of the liquidation of the Company's business and affairs and distributing its assets to shareholders, after satisfying all valid creditors' claims, including any obligations owed to employees, all in accordance with the Liquidation Plan and any order of the British Columbia Supreme Court (the "BC Supreme Court").


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Why is the Board recommending approval of the Liquidation Resolution and approval of the Liquidator Resolution?

        It is anticipated that, following the conclusion of the Aegerion Recapitalization, the Company will retain its existing cash balances and net operating loss ("NOL") carryforwards (subject to applicable tax laws). The value, if any, of such NOL carryforwards is expected to be minimal. Any remaining cash balances of the Company are also expected to be minimal, and will continue to decrease throughout the course of the liquidation and dissolution of the Company as administrative expenses will continue to be incurred and as currently existing obligations and liabilities are satisfied, including the payment of employee severance obligations. Accordingly, the Company will need to monetize at least a portion of the Amryt Equity in order to help fund this process. Therefore, the unsold Amryt Equity will be the only remaining material asset of Novelion and any distributions made to shareholders in connection with the Liquidation will consist almost entirely of the Amryt Equity, any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation, or a combination thereof, net of the Company's liabilities.

        As part of Novelion's review of strategic alternatives and evaluation process, and in connection with and leading up to the Aegerion Recapitalization, the Board considered the risks and viability of each alternative potentially available to Novelion, as well as management's financial and cash projections, and consulted with management and Novelion's legal and financial advisors. In arriving at its determination that the Liquidation Plan is advisable and in Novelion's best interests and the best interests of Novelion's shareholders, and is the preferred and only viable strategic option for Novelion after the consummation of the Aegerion Recapitalization, the Board carefully considered the terms of the Liquidation Plan and the liquidation and dissolution process under the BCBCA, as well as other potential available strategic alternatives. In approving the Liquidation Plan, the Board considered such terms and alternatives, as well as the following factors:

        The Board also considered the other factors described in the sections entitled "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Reasons for the Proposed Liquidation" and "Risk Factors" beginning on pages 33 and 24 of this Proxy Statement, respectively, and in those risk factors identified in Novelion's filings with the SEC.


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        In furtherance of the Company's duty to maximize value for the Company's shareholders and stakeholders, after reviewing the limited strategic alternatives reasonably available to the Company and considering that the Company will cease to have any ongoing business operations or sources of revenue upon the consummation of the Aegerion Recapitalization, the Board has determined that it is in the best interests of the Company and its shareholders to liquidate, wind-up and dissolve the Company pursuant to the Liquidation Plan.


What will happen if the Liquidation Resolution is approved?

Termination of Certain Employment Relationships and Business Operations

        In connection with the consummation of the Aegerion Recapitalization, we will decrease the number of full-time employees to three and our administrative (i.e., IT support, office space, expense reporting, payroll) expenses will decrease substantially. In addition, Amryt has agreed to reimburse us for certain compensation and benefits that we will be paying to two of the three remaining employees starting at the closing of the Aegerion Recapitalization until the earlier of each employee's last date of employment with the Company and December 31, 2019, in exchange for such employee's providing executive and transitional services to Amryt during such period. Under this agreement, Amryt will also provide us with accounting and SEC reporting support, if requested, for an agreed monthly fee, and administrative support at no cost. We further expect that as of the Effective Date or soon thereafter, the Company will not have any full-time employees. Regardless of whether the Liquidation Resolution is approved, however, the consummation of the Aegerion Recapitalization qualifies as a "Sale Event" or "Change in Control", as applicable, under our executive officers' employment agreements and, accordingly, upon the date of each executive officer's termination without cause or resignation for good reason, if applicable, such officer will (subject to the execution of a release of claims) be entitled to a lump-sum cash payment of his or her salary continuation and bonus severance benefits to be paid by Novelion. Further, the vesting of all outstanding awards under the Amended and Restated Novelion 2017 Equity Incentive Plan and the Aegerion Pharmaceuticals, Inc. 2010 Stock Option and Incentive Plan will accelerate immediately prior to the closing of the Aegerion Recapitalization. See "Executive Compensation —Narrative Disclosure to Summary Compensation —Employment Agreements with our current NEOs —Termination Arrangements with Messrs. Harshbarger and Louis" and "Executive Compensation —Narrative Disclosure to Summary Compensation —Employment Agreements with our current NEOs —Termination Arrangements with Mr. Price" for a more detailed description of the termination arrangements for our NEOs.

        Additionally, as set forth under "Proposal No. 3: Election of Directors", in connection with the Annual Meeting, the Board will be streamlined to consist of three directors, two of whom will be independent, reducing the amount of director compensation the Company will be responsible for. Further, upon the Effective Date, the Board will be deemed to have resigned and all powers of the Board will cease. The Liquidator will thereafter supervise the liquidation of the business and affairs of Novelion and the distribution of assets to shareholders after the satisfaction of all claims and obligations.

        Lastly, following the completion of the Aegerion Recapitalization, the Company will terminate all contracts and relationships with vendors that are not related to the liquidation, winding up and dissolution of the Company or continued compliance with applicable law throughout the implementation of the Liquidation Plan. Thus, other than executive and employee salaries and severance, and related costs, we expect that, after the Aegerion Recapitalization, our primary ongoing expenses will consist of legal expenses, auditor expenses and other administrative costs.

Liquidation Process

        Following the completion of the Aegerion Recapitalization, the Company's assets will consist principally of the Amryt Equity and cash on hand. The Company anticipates that, assuming receipt of the requisite shareholder approval, it will then adopt the Liquidation Plan and commence the liquidation process as soon as practicable. See "Schedule A —Plan of Liquidation and Distribution". If the requisite shareholder approval is not received at the Annual Meeting, the Company may adjourn or postpone the meeting and solicit additional votes of the Company's shareholders or it may apply to the BC Supreme Court for an order that a liquidator be appointed and that the Company be liquidated, wound up and dissolved.


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        Following the completion of a Claims Process (defined herein) and payment of remaining liabilities, including tax obligations, if any, arising from the disposition or distribution in kind of the Amryt Equity, the Company's liabilities are expected to be limited to those relating to the completion of the liquidation process and ongoing reporting to shareholders. Please refer to the disclosure under the heading "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Claims Process" beginning on page 37 of this Proxy Statement for additional information.


What is the quorumreporting and listing status of the Company?

Status as a Nasdaq-Listed Company

        As discussed under "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator and Remuneration Resolution —Trading of Common Shares" beginning on page 36 of this Proxy Statement, it is possible that the common shares of Novelion may be delisted following the Company's hearing scheduled with the Nasdaq Hearing Panel on October 3, 2019. Although Novelion is appealing to the Nasdaq Hearing Panel to permit the common shares of Novelion to continue to trade on The Nasdaq Stock Market LLC ("Nasdaq") at least through the date of the Annual Meeting, or through a subsequent date following the Annual Meeting, Novelion can make no assurance as to when the common shares of Novelion will be delisted from Nasdaq (or what trading halts may be imposed). Following any such delisting, the common shares of Novelion will no longer be listed for trading on Nasdaq or on any stock exchange and may only trade in the U.S. on the over-the-counter market, which is a less liquid market, if at all.

        Regardless of the foregoing, we anticipate that any and all trading of our common shares on Nasdaq or the over-the-counter market, as the case may be, will be suspended as of the Effective Date or as soon thereafter as is reasonably practicable, and that we will close our stock transfer books and discontinue recording transfers at that time. Accordingly, it is expected that trading in our common shares will cease after the Effective Date, at the latest. The Liquidation Plan provides that any liquidation distributions to shareholders of Novelion will be made only to those shareholders who are registered shareholders as of the Effective Date, though distributions may take place long after the Effective Date has passed.

Status as a Reporting Issuer

        The Company expects that, as part of the application to be made to the BC Supreme Court in connection with the liquidation, winding up and dissolution of the Company, a determination will be made to establish the timing for the Special Meeting?application to have the Company cease to be a reporting issuer pursuant to applicable Canadian securities laws. The Company anticipates that, subject to the BC Supreme Court's discretion, such application will be made as soon as possible after the commencement of the Liquidation, but there can be no assurance regarding how long the Company may continue as a reporting issuer.

        Additionally, whether or not the Liquidation Plan is approved, the Company has an obligation to continue to comply with the applicable reporting requirements of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"). If the Liquidation Plan is approved, in order to curtail expenses, the Company will seek relief from the SEC or otherwise initiate the steps to exit from certain reporting requirements under the Exchange Act. However, such process may be protracted or the SEC may not grant any such relief, or, if relief is granted, the Company may be required to continue to file Current Reports on Form 8-K to disclose material events, including those related to the Liquidation. See "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The Company will continue to incur expenses that will reduce the amount available for distribution, including expenses of complying with public company reporting requirements and paying its service providers, among others".

        Accordingly, the Company will continue to incur the costs associated with being a reporting issuer and public company until such time as it ceases to be subject to reporting obligations under applicable U.S. and Canadian law. The costs of compliance with such ongoing reporting requirements would reduce the amount which otherwise could be distributed to shareholders in connection with the Liquidation Plan.


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What is the total amount of payments, if any, that shareholders will receive and when will such payments be received?

The amount and timing of any distribution to registered shareholders will only be determined during the liquidation process by the Liquidator under supervision of the BC Supreme Court. The Board believes that it is not appropriate to distribute any property to shareholders until a court-supervised process is conducted in order to solicit outstanding claims and liabilities of the Company. The solicitation and resolution of claims will be implemented as part of the dissolution and liquidation process of the Company. See "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Distribution of Assets" beginning on page 38 of this Proxy Statement. It is intended that the Company, subject to shareholder approval, be dissolved and liquidated and that it complete the Liquidation Plan attached as "Schedule A —Plan of Liquidation and Distribution" hereto. The Company currently believes that the Liquidator will complete distributions in the fourth quarter of 2020, subject to the resolution of outstanding claims. See "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Uncertainty of Liquidation Distribution Amounts" beginning on page 39 of this Proxy Statement.

        Given that the Company currently expects that the liquidation distributions will consist almost entirely of the Amryt Equity (which is publicly traded), any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation, or a combination thereof, net of the Company's liabilities, the Company cannot predict with certainty the value of any liquidation distributions to its shareholders. Accordingly, you will not know the amount of any liquidation distributions you may receive as a result of the Liquidation Plan when you vote on the Liquidation Resolution. Many of the factors influencing the value of the liquidation distributions cannot currently be quantified with certainty and are subject to change, including the amount of cash the Company will need to fund the liquidation, the amount of Amryt Equity that will need to be sold by the Company in connection with such funding and the proceeds received therefrom, and the value of the Amryt Equity, which is dependent upon the business operations and financial success of Amryt and is subject to market fluctuations and volatility among other risks over which we have no control. The Company cannot determine at this time when, or potentially whether, it will be able to make any liquidation distributions to the Company's shareholders or the value of any such distributions. Shareholders may receive substantially less than the value that they expect to receive. See "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The Company cannot assure shareholders of the timing or amount of any liquidation distributions" and "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The value of the Amryt Equity and/or the amount of proceeds that might be realized from the sale of the Amryt Equity (if any), which is the Company's primary asset, is subject to fluctuation in the market prices of such Amryt Equity and the Company's ability to monetize such Amryt Equity on favorable terms, in a timely manner or at all. "beginning on pages 24 and 26 of this Proxy Statement, respectively.


When do you expect the Liquidation to be completed?

        Assuming the Liquidation pursuant to the Liquidation Plan is approved by the Company's shareholders, the Company will, as soon as practicable, sign the Liquidation Plan and will file a statement of intent to liquidate with the British Columbia Registrar of Companies. The authorisedBoard intends to set the Effective Date as promptly as practicable in the statement of intent to liquidate to be filed by the Company under the BCBCA. The completion of the Liquidation is currently expected to occur within three (3) months after the Company makes the liquidation distributions to its shareholders, with the completion of the dissolution expected to occur as specified in sections 341 to 343 of the BCBCA. See "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Overview of Steps to Complete the Liquidation and Dissolution" beginning on page 40 of this Proxy Statement.

        Under the BCBCA, despite the Liquidation, each shareholder of the Company to whom any of its property has been distributed is potentially liable, for a period of two years, to any person claiming under section 346 of BCBCA to the extent of the amount received by that shareholder upon the distribution, and an action to enforce such liability may be brought. Although the Company will be seeking a Claims Bar Order with the intention that no claims should be pursued following the Liquidation, there is no absolute certainty that the risk of claims arising after the Liquidation will be eliminated completely. See "Proposal No. 1: Approval of Liquidation


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Resolution and Proposal No. 2: Approval of Liquidator Resolution —Claims Process" and "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Potential Liability of Shareholders" beginning on pages 37 and 39, respectively, of this Proxy Statement.


Are there any appraisal or dissenters' rights?

        Pursuant to the BCBCA and the Company's organizational documents, you are not entitled to appraisal or dissenters' rights in connection with the Liquidation.


What are the material tax consequences of the Liquidation?

        All shareholders of the Company should review "Certain Material Canadian Federal Income Tax Considerations" and "Certain Material U.S. Federal Income Tax Considerations" beginning on pages 42 and 45, respectively, of this Proxy Statement for a general summary of certain material tax consequences of the Liquidation.Shareholders are urged to consult their own tax advisors as to the specific tax consequences to them of the Liquidation in light of each shareholder's particular circumstances.


What are the risks and uncertainties associated with the Liquidation?

        The Liquidation involves a number of risks, including, among others, that:

        You should read carefully the section of this Proxy Statement entitled "Risk Factors". In addition, if insufficient votes are received to approve the Liquidation Resolution and/or the Liquidator Resolution, the Company may adjourn or postpone the meeting and solicit additional votes of Company shareholders, or (iii) oneit may apply to the BC Supreme Court for an order that a liquidator be appointed and that the Company be liquidated and dissolved or may pursue other alternatives, but the Board does not believe these alternatives would result in greater shareholder value than the proposed Liquidation pursuant to the Liquidation Plan, and any alternative we select may entail additional risks.


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Do directors and executive officers have interests in the Liquidation?

        In considering the Board's recommendation to approve the Liquidation Resolution, you should be aware that some of our directors and executive officers may have interests in the Liquidation that are different from, or in addition to, the interests of our shareholders generally, namely, the Company's continuing indemnification obligations to its directors and officers. The Board was aware of these interests and considered them, among other matters, in approving the Liquidation pursuant to the Liquidation Plan and the transactions contemplated thereby. For additional information regarding the interests of the Company's directors and executive officers in the Liquidation, see "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Interests of the Company's Directors and Executive Officers in the Liquidation" beginning on page of 41 of this Proxy Statement.


What will happen if the Liquidation Resolution is not approved?

        If the Company's shareholders do not approve the Liquidation pursuant to the Liquidation Plan, the Company will continue its corporate existence. Given the lack of operations and that it has no source of revenues, the Board will have to explore other alternatives for returning capital to shareholders in a proxy holder representing anothermanner intended to maximize value and may apply to the BC Supreme Court for an order that a liquidator be appointed and that the Company be liquidated and dissolved without shareholder approval.

        As noted above under "—Liquidation Resolution and Liquidation Plan —What will happen if the Liquidation Resolution is approved? —Termination of Certain Employment Relationships and Business Operations", the Company currently expects that, in connection with the Aegerion Recapitalization, its full-time employees will gradually be reduced to none and that Board membership will be streamlined. Given these cost-reduction initiatives, there is no assurance that Board and committee composition will be fully compliant with applicable requirements or that anything more than essential management will remain in place for any length of time subsequent to the Aegerion Recapitalization.

Investors should be aware that Novelion does not have sufficient resources, operations or assets to continue as a stand-alone operating company. If the Liquidation Resolution and the Liquidator Resolution are not approved, the future of Novelion will be uncertain, and any realization of value will likely be significantly delayed or you may not realize any value for your Novelion shares.

Voting at the Annual Meeting

Who is entitled to vote at the Special Meeting,Annual Meeting?

        Only shareholders of record at the close of business on the record date may vote at the Annual Meeting. On a show of hands every shareholder present in person at the beginning of the Special Meetinghas one vote, and collectively holdingon a poll, every shareholder present in person or representing by proxy has one vote, for each Novelion common share registered in the aggregateshareholder's name. There are no other classes of voting securities other than the common shares. Cumulative voting is not less than 331/3% of the issued and outstanding QLT common shares as of the record date, will constitute a quorum for the Special Meeting. To the knowledge of the directors and executive officers of QLT, as of January     •    , 2016, the only persons or companies that beneficially own, control or direct, directly or indirectly, 10% or more of QLT's common shares is NB Public Equity K/S which, as evidenced by public filings, owns[6,447,626] common shares, representing approximately[12.20%] of the issued and outstanding common shares.permitted.


How do I vote?

        Carefully read and consider the information contained or incorporated by reference in this Proxy Statement. You should also determine whether you hold your shares directly in your name as a registered shareholder or through a broker or other nominee, because this will determine the procedure that you must follow in order to vote. If you are a registered shareholder of QLTNovelion (that is, if your shares are registered in your name, as opposed to being held through a broker or other intermediary), you may vote in any of the following ways:


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        All votes made by proxy must be received (whether delivered by mail, telephone or Internet)no later than Tuesday, February 9, 2016November 1, 2019 at 10:00 AM (Eastern Time)/7:00 AM (Pacific Time)/1:00 PM (Eastern Time). The Chair of the Annual Meeting may waive or extend the proxy cut-off time without notice.

        If you are a Beneficial Shareholder, then you will have received this material from your broker or the intermediary seeking your instructions as to how you wish your shares to be voted. In that case, follow the instructions given to you by your broker or the other intermediary. Existing Canadian regulatory policy requiresregulations require brokers and other intermediaries to seek voting instructions from Beneficial Shareholders in advance of shareholder meetings. The various brokers and other intermediaries have their own mailing procedures and provide their own return instructions to clients, which should be carefully followed by Beneficial Shareholders in order to ensure that their common shares are voted at the SpecialAnnual Meeting. The form of proxy supplied to a Beneficial Shareholder by its broker (or the agent of the broker) is substantially similar to the Instrument of Proxy provided directly to registered shareholders by QLT.Novelion. However, its purpose is limited to instructing the registered shareholder (i.e., the broker or agent of the broker) how to vote on behalf of the Beneficial Shareholder. A Beneficial Shareholder who receives a VIF from its broker or other intermediary cannot use that form to vote common shares directly at the SpecialAnnual Meeting. The VIFs must be returned to your broker or other intermediary (or instructions respecting the voting of common shares must otherwise be communicated to your broker or other intermediary) well in advance of the SpecialAnnual Meeting in order to have theyour common shares voted. If you have any questions respectingwith respect to the voting of common shares held through a broker or other intermediary, please contact that broker or other intermediary for assistance.

        The Notice of Meeting, Proxy Statement, Instrument of Proxy and VIF, as applicable, and the 2018 Annual Report are being provided to both registered shareholders and Beneficial Shareholders. Subject to the provisions of NI 54-101, issuers may request and obtain a list of their NOBOs from intermediaries directly or via their transfer agent and may obtain and use the NOBO list for the distribution of proxy-related materials directly to such NOBOs.

        QLT is distributingNovelion will distribute copies of the Notice of Meeting, Proxy Statement, VIF and VIF2018 Annual Report to intermediaries for distribution to NOBOs. Unless you have waived your right to receive the Notice of Meeting, Proxy Statement and VIF, intermediaries are required to deliver them to you as a NOBO of QLTNovelion and to seek your instructions on how to vote your common shares.

        QLT'sNovelion's OBOs can expect to be contacted by their brokers or their broker's agents. QLTNovelion will assume the costs associated with the delivery of the Notice of Meeting, Proxy Statement, VIF and VIF,2018 Annual Report as set out above, to OBOs by intermediaries.

        The ChairmanChair of the Annual Meeting may determine, in his or her sole discretion, to accept or reject an Instrument of Proxy that is delivered in person to the ChairmanChair at the SpecialAnnual Meeting as to any matter in respect of which a vote has not already been cast.If you are a shareholder of record, you have the right to appoint another person or company to attend and act on your behalf at the SpecialAnnual Meeting other than the persons named in the enclosed Instrument of Proxy. To exercise this right, you should strike out the names of the persons named in the Instrument of Proxy and insert the name of your nominee in the blank space provided. A person appointed as a proxy holder need not be a shareholder of QLT.Novelion. If you are a Beneficial Shareholder, you should follow the instructions set out above in the section entitled "— W"Whoho may attend the SpecialAnnual Meeting?" in connection with appointing another person to attend and act for ityou at the SpecialAnnual Meeting.


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How does the Board recommend that I vote?

        The Board believes that each of the resolutions being put to the shareholders at the Annual Meeting is in the best interests of Novelion and its shareholders and, accordingly, recommends that each shareholder vote such shareholder's common shares:


What vote is required to approve each proposal?

        Broker Non-Votes and Abstentions.    A "broker non-vote" occurs when a bank, broker or other holder of record holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have authority to vote on that particular proposal without receiving voting instructions from the beneficial owner. Broker non-votes will be treated as present for purposes of determining whether a quorum is present. Common shares held by holders who abstain from voting (or vote "withhold") will also be included for quorum purposes. Broker non-votes and abstentions are not counted as votes cast and, therefore, will have no effect on the outcome of any of the proposals being considered. However, a broker will have the discretion to vote on Proposal No. 5 (the Appointment of Independent Auditors Proposal) without any instructions from the beneficial owner. Brokers may not vote on any of the other proposals contained in this Proxy Statement, which are considered "non-routine" proposals, unless they have received voting instructions from the beneficial owner, and to the extent that they have not received voting instructions, brokers report such number of shares as "non-votes."We encourage all shareholders who hold shares through a bank, broker or other holder of record to provide voting instructions to such parties well in advance of the Annual Meeting to ensure that their shares are voted at the Annual Meeting.

        Liquidation Resolution.    For Proposal No. 1, the Liquidation Resolution, under the BCBCA, the affirmative vote, in person or by proxy, of two-thirds of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval.

        Liquidator Resolution.    For Proposal No. 2, Liquidator Resolution, the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval.

        Election of Directors Proposal.    For Proposal No. 3, the Election of Directors Proposal, under the BCBCA and the Articles of Novelion, directors are entitled to be elected by a plurality of the common shares voted at the Annual Meeting. This means that the three nominees with the most votes for election will be elected, subject to the requirements of the Company's majority voting policy (the "Majority Voting Policy"), which applies for elections of directors at uncontested shareholders' meetings. Pursuant to this policy, any nominee for director for which there are a greater number of votes "withheld" than votes "for" his or her election will be required to tender his or her resignation as a director of the Company. For more details with respect to the Majority Voting Policy, see "Proposal No. 3: Election of Directors —Majority Voting Policy." You may choose to vote, or withhold your vote, separately for each nominee director.

        Advisory Vote to Approve the Compensation of NEOs.    For Proposal No. 4, the Advisory Compensation Proposal, the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval, on an advisory basis. Because your vote is advisory, it will not be binding on the Board, the Compensation Committee of the Board or Novelion.

        Appointment of Independent Auditors Proposal.    For Proposal No. 5, the Appointment of Independent Auditors Proposal, the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of,


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shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval.


What is the quorum for the Annual Meeting?

        As of September 13, 2019, the authorized share structure of Novelion was comprised of 100,000,000 common shares and 5,000,000 non-voting First Preference shares, of which there were 19,618,946 common shares of Novelion issued and outstanding. All common shares in the capital of the Company carry the right to one vote. At least (i) two shareholders, (ii) two proxy holders representing two shareholders, or (iii) one shareholder and a proxy holder representing another shareholder entitled to vote at the Annual Meeting, present in person at the beginning of the Annual Meeting and collectively holding or representing by proxy in the aggregate not less than 331/3% of the issued and outstanding Novelion common shares as of the record date, will constitute a quorum for the Annual Meeting. To the knowledge of our directors and executive officers, as of September 13, 2019, the record date for the Annual Meeting, only the following persons or companies beneficially own, control or direct, directly or indirectly, 10% or more of our common shares: EdgePoint Investment Group Inc., which, as evidenced by public filings, beneficially owns 2,368,819 common shares, representing approximately 12.1% of our issued and outstanding common shares and Broadfin Capital, LLC, which, as evidenced by public filings, beneficially owns 2,138,597 common shares, representing approximately 10.9% of our issued and outstanding common shares. See the "Security Ownership of Certain Beneficial Owners and Management" section of this Proxy Statement for additional details. Abstentions and broker non-votes will be counted as present for the purpose of establishing a quorum; however, abstentions and broker non-votes will not be counted as votes cast.


How will proxies be exercised?

        The proxy holder will vote or withhold from voting according to instructions in the Instrument of Proxy on any ballot that may be called for and for which a choice has been specified. If you properly return your Instrument of Proxy, but do not include instructions on how to vote, your shares will be voted "FOR"voted:

        The Instrument of Proxy also confers upon the proxy holder discretionary authority to vote all shares represented by the proxy with respect to amendments or variations to matters identified in the Notice of Meeting and any other matter that properly comes before the SpecialAnnual Meeting. We know of no such amendment, variation or other matter that is to be presented for action at the SpecialAnnual Meeting. However, if any other matters which are not now known to us should properly come before the SpecialAnnual Meeting, the proxies will be voted, or not voted, by the proxy holder in his or her discretion.


Table of Contentsdiscretion, whether or not the amendment, variation or other matter that comes before the Annual Meeting is contested.


What does it mean if I receive more than one set of proxy materials?

        You may receive more than one set of proxy materials because you own QLTNovelion common shares that are registered under different names. For example, you may own some shares directly as a shareholder of record and other shares through a broker, or you may own shares through more than one broker. In these situations, you will receive multiple sets of proxy materials. It is necessary for you to vote all of the Instruments of Proxy according to the instructions contained in this Proxy Statement and to follow the instructions for any alternative voting procedures you receive in order to vote all of the shares you own. Each Instrument of Proxy you receive will come with its own prepaid return envelope. If you vote by mail, please make sure you return each Instrument of Proxy in the return envelope that accompanies that Instrument of Proxy.


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Can I change my vote after I have voted?

You may revoke your proxy at any time before it is exercised at the SpecialAnnual Meeting.    A proxy may be revoked by voting in person at the SpecialAnnual Meeting, by an instrument in writing stating that the proxy is revoked and signed and delivered as follows, or in any other manner provided by law. In order to revoke your proxy:

If your shares are held in the name of an intermediary such as a brokerage firm, securities dealer, trust company, bank or other nominee institution, you may change your vote by submitting new voting instructions to your intermediary, as applicable. You will need to contact your brokerage firm, securities dealer, trust company, bank or other nominee institution to learn how to make that change.


Who will tabulate the votes?

        Our transfer agent, Computershare, will tabulate votes cast by proxy by an automated system. Votes cast by proxy or in person at the SpecialAnnual Meeting will be counted by the persons appointed by us to act as scrutineer for the SpecialAnnual Meeting.


Who pays the cost of the proxy solicitation?

        This solicitation is made on behalf of Novelion. We will pay the cost of soliciting these proxies, including the printing, handling and mailing of the proxy materials. Copies of these materials will be given to brokerage firms, securities dealers, trust companies, banks and other institutions that hold our shares that are beneficially owned by others. We will reimburse these brokerage firms, securities dealers, trust companies, banks and other institutions for their reasonable out-of-pocket expenses in forwarding proxy materials to beneficial owners of our shares. Proxies may be solicited by certain directors, officers and employees of QLTNovelion personally or by telephone, mail, facsimile or e-mail. No additional compensation will be paid to directors, officers or other QLTNovelion employees for soliciting proxies. In addition, we may engage external proxy solicitation servicesWe have retained Okapi Partners LLC to solicitassist in soliciting proxies from brokers, banks and other institutional holders and from beneficial owners and individual holdersby personal interview, telephone, mail, facsimile or e-mail for a fee of record of common shares. In the event we engage such proxy solicitation services, we anticipate that the services would be provided at a standard fee and on other typical commercial terms.approximately $15,000, plus expenses.


How can shareholders submit proposals for QLT's NextNovelion's next Annual General Meeting?

        Under        Because Novelion is expecting to wind-up operations and liquidate, it is unlikely that it will hold another annual general meeting of shareholders. However, if there is to be another annual general meeting of shareholders of the Company, under U.S. securities laws, the deadline for submitting shareholder proposals for inclusion in the Company's proxy statement and form of proxy for the Company's 2016such annual meeting of Shareholders is


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May 21, 2016.    ], 2020. Proposals must be sent to our registered office at Suite 2600, 1066c/o Norton Rose Fulbright, 1800 — 510 West HastingsGeorgia Street, Vancouver, British Columbia, Canada V6E 3X1.V6B 0M3.

        Under        However, in the event that a 2020 annual general meeting of shareholder of the Company is convened, under the BCBCA, a proposal for a matter for consideration at the 2016next annual general meeting of Shareholdersshareholders, if any, must be received at our registered office at the address above on or before July 14, 2016.[    ·    ], 2020. For a proposal under the BCBCA to be valid, it must be in writing, accompanied by the requisite declarations and signed by the submitter and qualified shareholders who at the time of signing are the registered or beneficial owners of shares that, in the aggregate, (i) constitute at least 1% of the issued shares of QLTNovelion that have the right to vote at general meetings, or (ii) have a fair market value in excess of $2,000. For the submitter or a qualified


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shareholder to be eligible to sign the proposal, that shareholder must have been the registered or beneficial owner of QLTNovelion shares that carry the right to vote at general meetings for an uninterrupted period of at least two years before the date the proposal is signed, among other requirements.

        Shareholders are permitted to nominate individuals for election as directors under and if they comply with the provisions of our Advance Notice Policy, which is available on our website by following the link to such policy at:http://ir.novelion.com/corporate-governance.cfm. To be timely submitted for consideration for election at an annual general meeting of shareholders, nominations must be received at our registered office at the address above not less than 30 nor more than 65 days prior to the date of the annual meeting of shareholders; provided, however, that in the event that the annual meeting of shareholders is to be held on a date that is less than 50 days after the date on which the first public announcement of the date of the annual meeting was made, the nomination may be delivered not later than the close of business on the tenth day following the notice date.


Who can help answer my questions?

If you have questions about voting procedures, please call our proxy solicitor, Okapi Partners LLC, at (877) 629-6355.


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SUMMARY

This summary section highlights selected information contained elsewhere in this Proxy Statement and does not contain all of the information that is important to you. To understand fully the legal requirements for the voluntary liquidation, winding up and dissolution of the Company under the BCBCA and for a more complete description of the terms of the Liquidation Plan, you should carefully read this entire Proxy Statement and the documents delivered with this Proxy Statement.

The Company

Prior to the Aegerion Recapitalization, Novelion, through Aegerion, had operated a biopharmaceutical business dedicated to developing and commercializing new treatments for individuals living with rare diseases, including the two commercialized drugs in Aegerion's portfolio: (a) lomitapide (marketed in Canada, the United States and other markets as JUXTAPID® and as LOJUXTA® in the EU); and (b) metreleptin (marketed in the United States as MYALEPT® and in the EU as MYALEPTA®).

The mailing address and phone number of our principal executive office is c/o Norton Rose Fulbright, 1800-510 West Georgia Street, Vancouver, BC V6B 0M3 Canada and (877) 764-3131.

The Aegerion Recapitalization

On May 20, 2019, the Company, Aegerion, Amryt and certain other parties entered into a restructuring support agreement, and Aegerion and Amryt entered into a plan funding agreement, which, among other things, set forth the terms and conditions of the Aegerion Recapitalization. To facilitate the Aegerion Recapitalization, Aegerion and its U.S. subsidiary Aegerion Pharmaceuticals Holdings, Inc. filed the Chapter 11 Proceedings in the Bankruptcy Court. Under the chapter 11 plan, which was confirmed by the Bankruptcy Court on September 10, 2019, the Company's existing approximately $36 million intercompany secured loan to Aegerion will be allowed in full as a claim in the Chapter 11 Proceedings. In satisfaction of this claim, the Company will receive a distribution of the Amryt Equity, which is projected to represent approximately 8.1% equity ownership of Amryt on a pro forma basis, prior to dilution from other equity interests to be issued following the Aegerion Recapitalization. The Aegerion Recapitalization is expected to close on [·], 2019. See "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —General" and "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Background of the Transactions and Discussions Preceding the Proposed Liquidation" each beginning on page 28 of this Proxy Statement for more information regarding the Aegerion Recapitalization. Following the completion of the Aegerion Recapitalization, the Amryt Equity will be the only remaining material asset of Novelion and any distributions made to shareholders in connection with the Liquidation will consist almost entirely of the Amryt Equity, any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation, or a combination thereof, net of the Company's liabilities.


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The Liquidation Plan

General (see page 28)

At the Annual Meeting, the shareholders of the Company will be asked to approve, as a special resolution, the Liquidation Resolution and, as an ordinary resolution, the Liquidator Resolution, which were unanimously approved by the Board on September 18, 2019, subject to shareholder approval. The Board recommends that the Company's shareholders vote "FOR" the approval of the Liquidation Resolution and "FOR" the approval of the Liquidator Resolution.

The Board proposes the Liquidation of the Company pursuant to section 319(1) of the BCBCA, which Liquidation will become effective and commence at the Effective Date, in accordance with the Liquidation Plan. The Board intends to set the Effective Date as soon as practicable in the statement of intent to liquidate to be filed by the Company under the BCBCA. For a brief summary of the steps required to complete the Liquidation and the anticipated timing of each step, see "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Overview of Steps to Complete the Liquidation and Dissolution" beginning on page 40 of this Proxy Statement.

Reasons for the Proposed Liquidation (see page 33)

The Board believes that the voluntary liquidation, winding-up and dissolution of the Company is in the Company's best interests and the best interests of the Company's shareholders. The Board reviewed at length, with the assistance of legal, financial and other advisors, potential strategic alternatives. In arriving at its determination, the Board carefully considered, in addition to other pertinent factors:

the fact that, in connection with and leading up to the Aegerion Recapitalization, Novelion conducted a broad and public review of strategic alternatives involving Novelion as a whole, including a merger, asset sale, comprehensive restructuring or other business combination transaction, and despite outreach by Novelion's financial advisors to more than 50 parties, no viable potential buyer or partner emerged or was identified that was interested in such a transaction involving Novelion as a whole;

the fact that the go-shop provided for as part of the Aegerion Recapitalization did not yield any alternative proposals (see page 33 for a description of the go-shop);

the unlikelihood that shareholders would have realized more value per share upon a sale or other transaction involving Novelion than they will receive in connection with the Liquidation Plan;

the fact that, after the consummation of the Aegerion Recapitalization, Novelion remains a public company, complete with the substantial accounting, legal and other expenses typical for a public company but with limited assets and resources, and no remaining source of revenue;

the unlikelihood that the price of Novelion's common stock would increase in the future to a price greater than the current price or the value of the assets distributed in liquidation, given Novelion's limited assets and resources and that it has no source of revenue;

the terms and conditions of the Liquidation Plan; and


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the fact that the BCBCA requires that the liquidation of a corporation under section 319 of the BCBCA be approved by the affirmative vote of holders of two-thirds of Novelion common shares, represented in person or by proxy at the Annual Meeting, which ensures that, if the Board decides to proceed with the Liquidation, the Board will be taking actions of which a significant majority of Novelion's voting shareholders approve.

The Board also considered the other factors described in the sections entitled "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Reasons for the Proposed Liquidation" and "Risk Factors" beginning on pages 33 and 24, respectively, of this Proxy Statement and in those risk factors identified in Novelion's filings with the SEC.

In furtherance of the Company's duty to maximize value for the Company's shareholders and stakeholders, after reviewing the limited strategic alternatives reasonably available to the Company and considering that the Company will cease to have any ongoing business operations or sources of revenue upon the consummation of the Aegerion Recapitalization, the Board has determined that it is in the best interests of the Company and its shareholders to liquidate, wind-up and dissolve the Company pursuant to the Liquidation Plan.

Overview of the Liquidation (see pages 34 and 40)

If the Liquidation Plan and the appointment of the Liquidator are approved at the Annual Meeting, the steps set forth below, among others, will be completed following the Effective Date at such times as the Board, the Liquidator or the BC Supreme Court, as applicable, deems necessary, appropriate or advisable, all in accordance with the Liquidation Plan and the BCBCA:

the filing of any statement of intent to liquidate and the publishing of a notice to creditors as required under sections 321 and 331 of the BCBCA, respectively;

the application to the BC Supreme Court under section 325(1) of the BCBCA for such other directions and orders as may be deemed necessary or appropriate in connection with the liquidation of the Company, including without limitation an order establishing the Claims Process described herein;

the sale of any of the Company's non-cash property and assets, (See "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Distribution of Assets —Liquidation Distribution(s)");

the establishment of the Claims Process to be approved by the BC Supreme Court for the identification, resolution and barring of claims by creditors, including employees of the Company, against the Company ("Liquidation Claims"), including the provision of written notice of the commencement of the Liquidation to all known creditors and claimants of the Company, including employees;


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the delisting of the common shares of the Company from Nasdaq, as described under the heading "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Trading of Common Shares", unless sooner delisted in connection with the hearing scheduled with the Nasdaq Hearing Panel on October 3, 2019;

the application to cease being a reporting issuer in Canada, as described under the heading "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Status as a Reporting Issuer";

request relief from the SEC or otherwise initiate steps to exit from the reporting requirements under the Exchange Act, as described under the heading "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Status as a Reporting Issuer";

the payment of or the making of reasonable provision for the payment of all Proven Claims and obligations known to the Company, and the making of reserves as will be reasonably sufficient to provide compensation for any contingent Liquidation Claim, including, without limitation, the establishment and setting aside of a reasonable amount of cash and/or property to satisfy such contingent Liquidation Claims against, and obligations of, the Company;

the application to the Canada Revenue Agency (the "CRA") and other applicable governmental authorities for tax and other clearance certificates;

in accordance with the BCBCA and any order of the BC Supreme Court, the pro rata distribution to registered shareholders of the remaining assets of the Company after taking into account the payment or provision for payment of Proven Claims and contingent Liquidation Claims against and obligations of the Company; and

the winding up and dissolution of the Company.

Claims Process (see page 37)

A BC Supreme Court approved Claims Process will be established if the Company is successful in its application to the BC Supreme Court under section 325(1) of the BCBCA, for the identification, resolution and barring of Liquidation Claims. The Company anticipates seeking BC Supreme Court approval of a Claims Process as soon as reasonably practicable after the Effective Date.


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Liquidation Distributions and Uncertainty of Liquidation Distribution Amounts (see pages 38 and 39)

Given that the Company currently expects that the liquidation distributions will consist almost entirely of the Amryt Equity (which is publicly traded), any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation, or a combination thereof, net of the Company's liabilities, the Company cannot predict with certainty the value of any liquidation distributions to its shareholders. Accordingly, you will not know the amount of any liquidation distributions you may receive as a result of the Liquidation Plan when you vote on the Liquidation Resolution. The Company currently believes that the Liquidator will complete distributions by the fourth quarter of 2020, subject to the resolution of claims. The amount and timing of any liquidation distribution has not been determined.

Many of the factors influencing the value of the liquidation distributions cannot currently be quantified with certainty and are subject to change, including the amount of cash the Company will need to fund the Liquidation, the amount of Amryt Equity that will need to be sold by the Company in connection with such funding and the proceeds received therefrom, and the value of the Amryt Equity, which is dependent upon the business operations and financial success of Amryt and is subject to market fluctuations and volatility among other risks over which we have no control.

The Company cannot determine at this time when, or potentially whether, it will be able to make any liquidation distributions to the Company's shareholders or the value of any such distributions. Shareholders may receive substantially less than the value that they expect to receive. See "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The Company cannot assure shareholders of the timing or amount of any liquidation distributions" and "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The value of the Amryt Equity and/or the amount of proceeds that might be realized from the sale of any of the Amryt Equity (if any), which is the Company's primary asset, is subject to fluctuation in the market prices of such Amryt Equity and the Company's ability to monetize such Amryt Equity on favorable terms, in a timely manner or at all." beginning on pages 24 and 26 of this Proxy Statement, respectively.


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Trading of Common Shares (see page 36)

As discussed under "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Trading of Common Shares" beginning on page 36 of this Proxy Statement, it is possible that the common shares of Novelion may be delisted following the Company's hearing scheduled with the Nasdaq Hearing Panel on October 3, 2019. Although Novelion is appealing to Nasdaq to permit the shares of Novelion to continue to trade on Nasdaq at least through the date of the Annual Meeting, or through a subsequent date following the Annual Meeting, Novelion can make no assurance as to when the Novelion shares will be delisted from Nasdaq (or what trading halts may be imposed). Following any such delisting, the common shares of Novelion will no longer be listed for trading on Nasdaq or on any stock exchange and may only trade in the U.S. on the over-the-counter market, which is a less liquid market, if at all.

Regardless of the foregoing, we anticipate that any and all trading of our common shares on Nasdaq or the over-the-counter market, as the case may be, will be suspended as of the Effective Date or as soon thereafter as is reasonably practicable, and that we will close our stock transfer books and discontinue recording transfers at that time. Accordingly, it is expected that trading in our shares of common stock will cease after the Effective Date, at the latest. The Liquidation Plan provides that any liquidation distributions to shareholders of Novelion will be made only to those shareholders who are registered shareholders as of the Effective Date, though distributions may take place long after the Effective Date has passed.

Reporting Requirements

The Company expects that, as part of the application to be made to the BC Supreme Court in connection with the Liquidation, a determination will be made to establish the timing for the application to have the Company cease to be a reporting issuer pursuant to applicable Canadian securities laws. The Company anticipates that, subject to the BC Supreme Court's discretion, such application will be made as soon as possible after the commencement of the Liquidation, but there can be no assurances regarding how long the Company may continue as a reporting issuer.

Additionally, whether or not the Liquidation Plan is approved, the Company has an obligation to continue to comply with the applicable reporting requirements of the Exchange Act. If the Liquidation Plan is approved, in order to curtail expenses, the Company will seek relief from the SEC or otherwise initiate the steps to exit from certain reporting requirements under the Exchange Act. However, such process may be protracted or the SEC may not grant any such relief, or, if relief is granted, the Company may be required to continue to file Current Reports on Form 8-K to disclose material events, including those related to the Liquidation. See "Risk Factors —Risks Related to the Approval or the Failure to Approve the Liquidation Plan —The Company will continue to incur expenses that will reduce the amount available for distribution, including expenses of complying with public company reporting requirements and paying its service providers, among others".


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Potential Liability of Shareholders (see page 39)

Under the BCBCA, despite the Liquidation, each shareholder of the Company to whom any of its property has been distributed is potentially liable, for a period of two years, to any person claiming under section 346 of the BCBCA to the extent of the amount received by that shareholder upon the distribution, and an action to enforce such liability may be brought. The Claims Process described under the heading "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Claims Process", including the Claims Bar Order, is intended to mitigate the risk that any claims may arise following the Liquidation of the Company, but there is no absolute certainty that this risk will be eliminated completely.

Interests of Executive Officers and Directors in the Liquidation of the Company (see page 41)

Some of our directors and executive officers may have interests in the Liquidation that are different from, or in addition to, the interests of our shareholders generally, namely, the Company's continuing indemnification obligations to its directors and officers. The Board was aware of these interests and considered them, among other matters, in approving the Liquidation pursuant to the Liquidation Plan and the transactions contemplated thereby.

Certain Material Canadian Federal Income Tax Considerations (see page 42)

All shareholders of the Company should review "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Certain Material Canadian Federal Income Tax Considerations" for a general summary of certain material Canadian federal tax consequences of the Liquidation. Shareholders are urged to consult their own tax advisors as to the specific tax consequences to them of the Liquidation in light of each shareholder's particular circumstances.

Certain Material U.S. Federal Income Tax Considerations (see page 45)

All shareholders of the Company should review "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Certain Material U.S. Federal Income Tax Considerations" for a general summary of certain material U.S. federal tax consequences of the Liquidation. Shareholders are urged to consult their own tax advisors as to the specific tax consequences to them of the Liquidation in light of each shareholder's particular circumstances.

Annual Meeting

The Annual Meeting will be held at the offices of Goodwin Procter LLP, 100 Northern Avenue, Boston, Massachusetts 02210, on November 5, 2019 at 10:00 AM (Eastern Time)/7:00 AM (Pacific Time) for the following purposes, each of which is described in more detail in this Proxy Statement:

To approve as a special resolution the Liquidation Resolution.

To approve as an ordinary resolution the Liquidator Resolution.

To approve the Election of Directors Proposal.

To approve the Advisory Compensation Proposal, on a non-binding, advisory basis.

To approve the Appointment of Independent Auditors Proposal.


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To transact such other business as may properly come before the Annual Meeting, or at any adjournments or postponements thereof.

Required Vote

Liquidation Resolution.    For Proposal No. 1, the Liquidation Resolution, under the BCBCA, the affirmative vote, in person or by proxy, of two-thirds of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval.

Liquidator Resolution.    For Proposal No. 2, Liquidator Resolution, the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval.

Election of Directors Proposal.    For Proposal No. 3, under the BCBCA and the Articles of Novelion, directors are entitled to be elected by a plurality of the common shares voted at the Annual Meeting. This means that the three nominees with the most votes for election will be elected, subject to the requirements of the Company's majority voting policy (the "Majority Voting Policy"), which applies for elections of directors at uncontested shareholders' meetings. Pursuant to this policy, any nominee for director for which there are a greater number of votes "withheld" than votes "for" his or her election will be required to tender his or her resignation as a director of the Company. For more details with respect to the Majority Voting Policy, see "Proposal No. 3: Election of Directors —Majority Voting Policy." You may choose to vote, or withhold your vote, separately for each nominee director.

Advisory Vote to Approve the Compensation of NEOs.    For Proposal No. 4, the Advisory Compensation Proposal, the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval, on an advisory basis. Because your vote is advisory, it will not be binding on the Board, the Compensation Committee of the Board or Novelion.

Appointment of Independent Auditors Proposal.    For Proposal No. 5, the Appointment of Independent Auditors Proposal, the affirmative vote, in person or by proxy, of a majority of the votes cast by, or on behalf of, shareholders of the Company entitled to vote in person or by proxy at the Annual Meeting will be required for approval.

Recommendation of Our Board of Directors

The Board believes that each of the resolutions being put to the shareholders at the Annual Meeting is in the best interests of Novelion and its shareholders and, accordingly, recommends that each shareholder vote such shareholder's shares:

"FOR" the Liquidation Resolution;

"FOR" the Liquidator Resolution;

"FOR" the Election of Directors Proposal;

"FOR" the Advisory Compensation Proposal; and

"FOR" the Appointment of Independent Auditors Proposal.

Risk Factors

In evaluating the Liquidation Plan, you should carefully read this Proxy Statement and especially consider the factors discussed in the section entitled "Risk Factors" beginning on page 24 of this Proxy Statement.


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CAUTIONARY NOTESTATEMENT REGARDING FORWARD LOOKING STATEMENTSINFORMATION

        This        Certain statements in this Proxy Statement and the documents incorporated by reference herein contain forward-looking statementsmay constitute "forward looking information" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and may be forward-looking information as defined under applicable Canadian and United States securities legislation (collectively, "forward-looking statements"). Forward looking statements include, but are not limited to, statements concerninglaws. Without limiting the proposed Aralez Transaction, the proposed Special Distribution, the proposed Reorganization of Share Capital (as such terms are defined herein), including any statements regarding the expected timetable for completion of the Aralez Transaction, the Special Distribution, the Reorganization of the Share Capital, the potential benefits of the Special Distribution, the Reorganization of Share Capital to QLT shareholders, the future potential of Aralez Pharmaceuticals Inc. and any other statements regarding QLT's future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts are "forward-looking" statements made within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are often, but not always, made through the use offoregoing, words or phrases such as "believe,"will likely result," "expect,"are expected to," "will continue," "anticipate," "should," "planned," "will," "may," "intend," "estimated," "aim," "on track," "target," "opportunity," "tentative," "positioning," "designed," "create," "predict,"estimate," "project," "seek,"pro forma," "would,"believe," "could," "potential," "continue," "ongoing," "upside," "increases," and "potential" and"intend" or similar expressions.expressions are intended to identify forward-looking statements. All such forward-looking statements involve estimates and assumptions that, although believed to be reasonable based on information currently available to management, are subject to risks, uncertainties and other factors that could result in material changes to the plans expressed or described in the statements. Such risks and uncertainties relate to, among other things: the availability, timing and amount of liquidation distributions; the amounts that will need to be set aside by the Company; the adequacy of such reserves to satisfy the Company's obligations; the ability of the Company to favorably resolve any potential tax claims, litigation matters and other unresolved contingent liabilities of the Company; the amount of proceeds that might be realized from any sale or other disposition of the Amryt Equity; the potential volatility in the market price of such Amryt Equity; the application of, and any changes in, applicable tax laws, regulations, administrative practices, principles and interpretations; and the incurrence by the Company of expenses relating to the Liquidation. Further information regarding the risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed in the statements. In making such statements the Company has assumed that the Aralez Transaction will complete and that the transactions contemplated under the Backstop Agreement will complete. There is no certainty that such assumptions will be correct. Among the key factors that could cause actual results to differ materially from those projected in theof these forward-looking statements are discussed under the Board's discretion not to complete either the Special Distribution, timing to consummate the Special Distributionsection "Risk Factors" in this Proxy Statement and the risk that a condition to closing the Aralez Transaction may not be satisfied,in our periodic and the risk that shareholder approval of the Reorganization of Share Capital may not be obtained. Additional information concerning thesecurrent reports and other factors can be found in QLT's filingsdocuments filed with the SEC, including QLT's most recent Annual ReportSEC. You should not place undue reliance on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. QLT assumesany such forward-looking statements. Except as required by law, we undertake no obligation to update any forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as ofor revise the date hereof.


SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        The following table sets forth the common sharesinformation contained in QLT's authorized share structure beneficially owned by (i) each of our current directors, (ii) each of our named executive officers, (iii) all of our directors and executive officersthis Proxy Statement, whether as a group, and (iv) all persons known by us to beneficially own more than 5%result of our outstanding voting shares. We have determined the beneficial ownership shown on this table in accordance with the rules of the SEC and the applicable Canadian securities regulators. Under those rules, shares are considered beneficially owned if held by the person indicated,new information, future events or if such person, directlycircumstances or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares the power to vote, to direct the voting ofotherwise.


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and/or
RISK FACTORS

There are many factors the Company's shareholders should consider when deciding whether to disposevote in favor of orthe Liquidation Resolution and the Liquidator Resolution, including the risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2018 (as amended), in subsequently filed Quarterly Reports on Form 10-Q and in our subsequent Current Reports on Form 8-K. In addition to directthese risks, you should carefully consider the disposition of such security. Except as otherwise indicatedadditional risks described below, together with all other information included in this Proxy Statement and the documents delivered with this Proxy Statement before making a decision about voting on the proposals. Notably, the Company cautions that trading in the accompanying footnotes, beneficial ownershipCompany's securities is shownhighly speculative and poses substantial risks. Trading prices for the Company's securities may bear little or no relationship to the actual value realized, if any, by holders of the Company's securities. Accordingly, the Company urges extreme caution with respect to existing and future investments in its securities.


Risks Related to the Approval or the Failure to Approve the Liquidation Plan

The Company cannot assure shareholders of the timing or amount of any liquidation distributions.

        Given that the Company currently expects that the liquidation distributions will consist almost entirely of the Amryt Equity (which is publicly traded), any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation, or a combination thereof, net of the Company's liabilities, the Company cannot predict with certainty the value of any liquidation distributions to its shareholders. Accordingly, you will not know the amount of any liquidation distributions you may receive as a result of January     •    , 2016.the Liquidation Plan when you vote on the Liquidation Resolution. Many of the factors influencing the value of the liquidation distributions cannot currently be quantified with certainty and are subject to change, including the amount of cash the Company will need to fund the Liquidation, the amount of Amryt Equity that will need to be sold by the Company in connection with such funding and the proceeds received therefrom, the value of the Amryt Equity, which is dependent upon the business operations and financial success of Amryt and is subject to market fluctuations and volatility among other risks over which we have no control, the Company's inability to predict the amount of its remaining liabilities or the amount that the Company will incur during the course of the Liquidation, the net value, if any, of its remaining non-cash assets and the fact that, if the Liquidation and Liquidation Plan are approved, the Liquidator will have the power and authority to approve the number, amount and timing of any liquidation distributions. In addition, the timing and amount of any liquidation distributions may be impacted by (i) the Company's and/or the Liquidator's discussions with the CRA and other applicable taxation authorities in finalizing the Company's and its subsidiaries final tax returns and the amounts of their corresponding tax liabilities and (ii) the number and complexity of claims resulting from the Claims Process and whether any disputed claims can be reserved for or processed in an expedited manner.

        The value of the Amryt Equity may fluctuate materially. Therefore, the value distributed under the Liquidation Plan may vary materially. The value of the Amryt Equity may fluctuate with the performance of Amryt, specific industry conditions, including the success or failure of other companies in the industry, the investment attitude with respect to the industry and changes to its regulatory environment, and general economic conditions, including the level of interest rates, corporate earnings, economic activity, the value of currencies and other factors, including the fact that there may be a limited or no market for the Amryt Equity.

 
 Amount and Nature of Beneficial
Ownership
 Total Beneficial
Ownership
Name of Beneficial Owner
 Shares
Beneficially
Owned
 Shares for Which
Beneficial Ownership
Can Be Acquired Within
60 Days(1)
 Number of
Shares(2)
 Percent of Class(3)

Directors

           

Jason M. Aryeh

  517,078    517,078 *

Dr. John W. Kozarich

  57,000    57,000 *

Jeffrey A. Meckler

  107,000  225,000  332,000 *

Dr. Stephen L. Sabba

  37,000    37,000 *

John C. Thomas, Jr.

  37,000    37,000 *

Officers

           

W. Glen Ibbott

    100,000  100,000 *

Dr. Geoffrey F. Cox

  78,500  90,000  168,500 *

Dori C. Assaly

  500    500 *

Lana E. Janes

       *

All directors and executive officers as a group (9 persons)(4)

  834,078  415,000  1,249,078 2.4%

5% Shareholders

           

NB Public Equity K/S(5)

  6,447,626    6,447,626 12.20%

Broadfin Capital LLC(6)

  4,445,527    4,445,527 8.41%

BVF PARTNERS L P/IL(7)

  3,737,446    3,737,446 7.07%

Scopia Capital Management LLC(8)

  3,336,177     3,336,177 6.32%

Kingstown Capital Management LP(9)

  3,000,000    3,000,000 5.68%

Ancora Advisors, LLC(10)

  2,937,862    2,937,862 5.56%

*
Represents

        You may receive substantially less than 1%.

(1)
Indicates common sharesthe value that you expect to receive. These risks will be amplified if the Liquidation Plan is not approved, in which case the Company can make no assurances that any liquidation distributions will be made to the Company's shareholders.

The Company will continue to incur expenses that will reduce the amount available for distribution, including expenses associated with complying with public company reporting requirements and paying its service providers, among others.

        As the Company winds up, it will continue to incur expenses from operations, including compensation to the limited number of employees implementing the Liquidation Plan, if any, compensation to the Company's remaining independent directors (if any), directors' and officers' insurance and other insurance premiums, income, payroll and other taxes (including any taxes that may be acquired upon exercise of outstanding stock options that are presently exercisableimposed on any sale, distribution or will be exercisable within 60 days of January     •    , 2016 by the persons named in the table above and by all directors and executive officers as a group, except where otherwise described in the Notes to the above table.

(2)
Excludes DSUs, which are issued to directors and are payable only in cash. As of January     •    , 2016, each of Messrs. Cox, Kozarich, Meckler, Sabba and Thomas hold 19,861 vested DSUs and Mr. Aryeh holds 39,722 vested DSUs.

(3)
Percentage ownership of QLT common shares is based on[52,829,398] common shares of QLT outstanding on January     •    , 2016.

(4)
The information in the table is derived from the System for Electronic Disclosures by Insiders (SEDI).

(5)
The information in the table and this note is derived from a Schedule 13D/A filed by NB Public Equity K/S with the SEC on July 15, 2014. Based on information contained in the Schedule 13D/A, NB Public Equity K/S, NB Public Equity Komplementar ApS, Cora Madsen and Florian Schönharting (collectively, the "NB Entities") are deemed beneficial owners of 6,447,626 shares. Each of the NB Entities has shared voting and dispositive power over all shares they are deemed to beneficially own. The business address of NB Public Equity K/S is Ostergade 24A, 1, DK-1100, Copenhagen K, Denmark.

(6)
The information in the table and this note is derived from a Schedule 13G filed by Broadfin Capital, LLC with the SEC on June 25, 2015 and the Form 13F filed by Broadfin Capital, LLC with the SEC on November 16, 2015. Based on information contained in the Schedule 13G and the Form 13F, Broadfin Capital, LLC, Broadfin Healthcare Master Fund, Ltd., and Kevin Kotler (collectively, the "Broadfin Entities") are deemed beneficial owners of 4,445,527 shares. Each of the Broadfin Entities has shared voting and dispositive power over all shares they are deemed to beneficially own. The business address of Broadfin Capital, LLC is 300 Park Avenue, 25th Floor, New York, New York 10022, United States of America. Broadfin Healthcare Master Fund, Ltd. is a party to the Backstop Agreement. See the heading below "Proposal No. 2 — Approval of a Reorganization of Share Capital Pursuant to an Arrangement — Aralez Distribution." As announced by QLT on June 8, 2015, Broadfin Healthcare Master Fund, Ltd. has also agreed to acquire 5,347,594 common shares of QLT pursuant to a private placement financing following completion of the Special Distribution to QLT shareholders.

(7)
The information in the table is derived from the Form 13F filed by BVF INC/IL with the SEC on November 16, 2015.
other


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(8)

disposition of the Company's remaining non-cash assets), legal, accounting, financial, advisory and consulting fees and general and administrative expenses. Additionally, regardless of whether the Liquidation Resolution is approved, the Company will (subject to a release of claims) be required to pay each of our four executive officers a lump-sum cash payment of his or her salary continuation and bonus severance benefits because the Aegerion Recapitalization constitutes a "Sale Event" or "Change in Control", as applicable, under each executive officer's employment agreement and upon any corresponding termination without cause or resignation for good reason in connection therewith. See "Executive Compensation — Narrative Disclosure to Summary Compensation — Employment Agreements with our current NEOs — Termination Arrangements with Messrs. Harshbarger and Louis" and "Executive Compensation — Narrative Disclosure to Summary Compensation — Employment Agreements with our current NEOs — Termination Arrangements with Mr. Price" for a more detailed description of the relevant termination arrangements with such officers.

The informationactual amount of such expenses could be much higher than currently anticipated and will reduce the amount of assets available for ultimate distribution to our shareholders. If the Liquidation Plan is not approved, the Company expects to continue to incur expenses from operations, including to officers and other employees, directors and advisors of the Company, including as the Company contemplates its other alternatives, and will be responsible for such termination arrangements noted above upon any corresponding termination without cause or resignation for good reason that occurs in connection with the Aegerion Recapitalization. Such expenses would likely be in excess of those expected to be incurred in connection with implementing the Liquidation Plan.

        The Company will have an obligation to continue to comply with the applicable reporting requirements of the Exchange Act and applicable Canadian securities law, even if compliance with these reporting requirements is economically burdensome. In order to curtail expenses, the Company will request relief from the SEC or otherwise initiate the steps to exit from certain reporting requirements under the Exchange Act. Concurrently therewith, we also expect, as part of the application to be made to the BC Supreme Court in connection with the Liquidation, an application will be made to establish the timing for the Company to cease to be a reporting issuer in Canada. With regard to SEC reporting requirements, such process may be protracted or the SEC may not grant any such relief, or, if relief is granted, the Company may be required to continue to file Current Reports on Form 8-K to disclose material events, including those related to the Liquidation. Accordingly, the Company will continue to incur the costs associated with being a reporting issuer and public company until such time as it ceases to be subject to reporting obligations under applicable U.S. and Canadian law. The costs of compliance with such reporting requirements would reduce the amount which otherwise could be distributed to shareholders.

If the Company fails to retain sufficient funds to pay the liabilities actually owed to the Company's creditors, including employees of the Company, each shareholder receiving liquidation distributions could be liable for payment to the Company's creditors, including employees, of his, her or its pro rata share of any shortfall, up to the amount actually distributed to each shareholder in connection with the Liquidation.

        The Company will only be able to confirm the amount of its liabilities following completion of the Claims Process contemplated by the Liquidation Plan. However, as discussed under the heading "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Claims Process" in this Proxy Statement, although the Company will be seeking a Claims Bar Order which would provide that no claims may be pursued following the Liquidation, there is no absolute certainty that the risk of claims arising after the Liquidation of the Company will be eliminated completely. In the event that the Company fails to retain sufficient funds to pay the expenses and liabilities actually owed to the Company's creditors, including employees of the Company, each shareholder could be held liable for the repayment to those creditors, including employees, whose claims are not barred by the Claims Bar Order or otherwise, out of amounts previously received by such shareholder from the Company (up to the full amount actually received by such shareholder).

        Moreover, the amount of taxes payable estimated by the Company is subject to assessment by taxation authorities. The process available for distribution to shareholders will be negatively impacted by claims exceeding estimated liabilities or taxes exceeding accrued amounts thereof.


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The value of the Amryt Equity and/or the amount of proceeds that might be realized from any sales of the Amryt Equity (if any), which is the Company's primary asset, is subject to fluctuation in the tablemarket prices of such Amryt Equity and the Company's ability to monetize such Amryt Equity on favorable terms, in a timely manner or at all.

        As of [    ·    ], 2019, the Amryt Equity represented approximately [    ·    ]% of the Company's total assets. The trading price of the Amryt Equity may be volatile or there may be no trading market for such equity on AIM (The London Stock Exchange's international market for smaller growing companies on which Amryt will be traded upon the consummation of the Aegerion Recapitalization), which could result in substantial losses to the Company and affect the Company's ability to monetize the Amryt Equity on favorable terms, in a timely manner or at all. It is currently expected that Amryt will apply to list its ordinary shares, or American depositary shares representing the Amryt Equity, on Nasdaq within 90 days of the consummation of the Aegerion Recapitalization, however, there is no assurance that such an application will be successful or, if it is, that a market will develop for the Amryt Equity in the United States. Moreover, the value and market price of the Amryt Equity is affected by Amryt's business, management, results of operations and financial condition and may be affected by open market sales of such equity by the Company or others. Accordingly, the market for the Amryt Equity may be limited and the value of the Amryt Equity may significantly decline from the closing of the Aegerion Recapitalization based on the trading volume of such equity and the performance of Amryt generally.

Shareholders should review information made available by Amryt at its website at www.amrytpharma.com because the Company's ability to monetize the Amryt Equity on favorable terms or at all, will depend heavily upon and be influenced by the value of the Amryt Equity. Information relating to Amryt in this Proxy Statement is derived from public information available on Amryt's website. Such information is provided for informational purposes only and the Form 13F filedCompany makes no representation and assumes no responsibility for the accuracy or completeness of such information.

The Company will cease to carry on an active business.

        Following the completion of the Aegerion Recapitalization, the Company will cease to carry on any active business and will have no sources of revenue.Notably, Novelion does not have sufficient resources, operations or assets to continue as a stand-alone operating company. If the Liquidation Resolution and the Liquidator Resolution are not approved, the future of Novelion will be uncertain, and any realization of value for your Novelion shares will likely be significantly delayed or you may not realize any value for your Novelion shares. If the Liquidation Resolution and the Liquidator Resolution are not approved, the Company may apply to court for an order that a liquidator be appointed and that the Company be liquidated, wound up and dissolved.

The Company may be unable to continue as a going concern if the Liquidation Resolution is not approved and may have to seek court assistance to liquidate.

        If the Liquidation Resolution and the Liquidator Resolution are not approved by Scopia Capital Management LPshareholders at the Annual Meeting, and consequently, if the Liquidation Plan is not implemented with the SEC on November 16, 2015.

(9)
The informationsupport of shareholders, the Company does not anticipate being able to generate cash flow to meet its financial obligations given that the Company will have no current operating business and no sources of revenue after the closing of the Aegerion Recapitalization. As such, the Company may be unable to continue as a going concern and may be required to: (i) apply to the BC Supreme Court for an order that a liquidator be appointed and that the Company be liquidated, wound up and dissolved; or (ii) in the tableevent that the Company's remaining assets are depleted through continuing administrative and/or other unforeseen expenditures, seek protection under applicable bankruptcy and this noteinsolvency laws.

The common shares of the Company will be delisted from Nasdaq.

        As discussed below under "Proposal No. 1: Approval of Liquidation Resolution and Proposal No. 2: Approval of Liquidator Resolution —Trading of Common Shares" beginning on page 36, it is derived frompossible that the Form 13F filed by Kingstown Capital Management L.P.common shares of Novelion may be delisted following the Company's hearing scheduled with the SECNasdaq Hearing Panel on November 16, 2015October 3, 2019. Although Novelion is appealing to Nasdaq to permit the shares of Novelion to continue to trade on Nasdaq at least through the date of the Annual Meeting, or, through a subsequent date following the Annual Meeting, Novelion can make no assurance as to when the Novelion shares will be delisted from Nasdaq


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(or what trading halts may be imposed). Following any such delisting, the common shares of Novelion will no longer be listed for trading on Nasdaq or any stock exchange and the Schedule 13D/A filed by Kingstown Partners Master Ltd., Kingstown Partners II, L.P., Ktown, LP, Kingstown Capital Partners, LLC, Kingstown Capital Management L.P., Kingstown Management GP LLC, Michael Blitzer and Guy Shannon (collectively, the "Kingstown Entities") with the SEC on July 9, 2014. Based on information containedmay only trade in the Schedule 13D/A, Kingstown Partners Master Ltd. beneficially owns 2,488,132U.S. on the over-the-counter market, which is a less liquid market, if at all.

        Regardless of the foregoing, we anticipate that any and all trading of our common shares Kingstown Partners II, L.P. beneficially owns 316,212 shares, Ktown, L.P. beneficially owns 445,656 shares, Kingstown Capital Partners, LLC beneficially owns 3,000,000 shares, and each of Kingstown Capital Management L.P., Kingstown Management GP LLC, Michael Blitzer and Guy Shannonon Nasdaq or the over-the-counter market, as the case may be, deemedwill be suspended as of the Effective Date or as soon thereafter as is reasonably practicable, and that we will close our stock transfer books and discontinue recording transfers at that time. Accordingly, it is expected that trading in our shares of common stock will cease after the Effective Date, at the latest. The Liquidation Plan provides that any liquidation distributions to shareholders of Novelion will be made only to those shareholders who are registered holders as of the Effective Date, though distributions may take place long after the Effective Date has passed.

        When the common shares of Novelion cease to be the beneficial owner of 3,000,000 shares. Eachlisted for trading on Nasdaq or on any other designated stock exchange in Canada (as defined for purposes of the Kingstown EntitiesTax Act), the common shares will continue to be a "qualified investment" (as defined under the Tax Act) for a "registered plan" unless certain conditions are satisfied simultaneously. For this purpose, a registered plan is a trust governed by a registered retirement savings plan, registered retirement income fund, registered disability savings plan, deferred profit sharing plan, tax-free savings account and a registered education savings plan. The relevant conditions are that: (i) the CRA notifies the Company that is has shared voting and dispositive power over all shares they are deemedbeen designated not to beneficially own. The business address of Kingstown Partners Master Ltd. is c/o Walkers Corporate Services Limited, Walkers House, 87 Mary Street, George Town, Grand Cayman Ky1-9005, Cayman Islands. The business address of eachbe a public corporation in accordance with subparagraph (c)(ii) of the other Kingstown Entities is 100 Park Avenue, 21st Floor, New York City, New York, 10017.

(10)
The informationdefinition of "public corporation" under the Tax Act, and (ii) the Company ceases to meet specified requirements regarding the ownership of its common shares. There can be no assurances given that the common shares of Novelion would continue to satisfy the requirements to remain as a qualified investment for an investment by a registered plan. Shareholders who hold common shares in a registered plan should seek their own tax advice regarding the table is derived fromimplications to them if the Form 13F filed by Ancora Advisors, LLC with the SEC on October 30, 2015.
common shares cease to be classified as a qualified investment.


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PROPOSAL NO. 1: APPROVAL OF A REORGANIZATIONLIQUIDATION RESOLUTION

AND

PROPOSAL NO. 2: APPROVAL OF SHARE CAPITAL PURSUANT TO AN ARRANGEMENTLIQUIDATOR RESOLUTION

General

        We are seeking shareholder approval of the Liquidation Resolution and the Liquidator Resolution at the Annual Meeting. The Liquidation Plan was unanimously approved by the Board on September 18, 2019, subject to shareholder approval. The Board has approved,recommends that you vote "FOR" the approval of the Liquidation Resolution and "FOR" the approval of the Liquidator Resolution.

        On May 20, 2019, the Company, Aegerion, Amryt and certain other parties entered into a restructuring support agreement, and Aegerion and Amryt entered into a plan funding agreement, which, among other things, set forth the terms and conditions of the Aegerion Recapitalization. To facilitate the Aegerion Recapitalization, Aegerion and its U.S. subsidiary Aegerion Pharmaceuticals Holdings, Inc. filed voluntary petitions under Chapter 11 of Title 11 of the United States Code (the "Chapter 11 Proceedings") in principle, returning capitalthe United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court"). Under the chapter 11 plan, which was confirmed by the Bankruptcy Court on September 10, 2019, the Company's existing approximately $36 million intercompany secured loan to Aegerion will be allowed in full as a claim in the shareholdersChapter 11 Proceedings. In satisfaction of this claim, the Company will receive a distribution of Amryt equity under the Aegerion Recapitalization, which is projected to represent approximately 8.1% equity ownership of Amryt on a pro forma basis, prior to dilution from other equity interests to be issued following the Aegerion Recapitalization (the "Amryt Equity"). The Aegerion Recapitalization is expected to close on [    ·    ], 2019.

        It is anticipated that, following the conclusion of the Aegerion Recapitalization, the Company will retain its existing cash balances and net operating loss ("NOL") carryforwards (subject to applicable tax laws). The value, if any, of such NOL carryforwards is expected to be minimal. Any remaining cash balances of the Company throughare also expected to be minimal, and will continue to decrease throughout the course of the liquidation and dissolution of the Company as administrative expenses will continue to be incurred and as currently existing obligations and liabilities are satisfied, including the payment of employee severance obligations. Accordingly, the Company will need to monetize at least a special distribution (the "Special Distribution")portion of the Amryt Equity in order to help fund this process. Therefore, the QLTunsold Amryt Equity will be the only remaining material asset of Novelion and any distributions made to shareholders of common shares of Aralez Pharmaceuticals Inc. (the "Aralez Shares") which QLT will acquire, or cash in lieu of Aralez Shares, provided that the cash amount will not exceed $15 million.

        The decision whether to proceedconnection with the Special Distribution andLiquidation will consist almost entirely of the meansAmryt Equity, any remaining proceeds from the sale of any such distribution, is entirely ata portion of the discretionAmryt Equity by the Company in order to fund the Company's expenses, including the expenses of the Liquidation, or a combination thereof, net of the Company's Board.liabilities.


Background of the Transactions and Discussions Preceding the Proposed Liquidation

        Prior to the Aegerion Recapitalization, Novelion, through Aegerion, had operated a biopharmaceutical business dedicated to developing and commercializing new treatments for individuals living with rare diseases, including the two commercialized drugs in Aegerion's portfolio: (a) lomitapide (marketed in Canada, the United States and other markets as JUXTAPID® and as LOJUXTA® in the EU); and (b) metreleptin (marketed in the United States as MYALEPT® and in the EU as MYALEPTA®).

        The Company intends to implementAs a result of a merger transaction involving,inter alia, Novelion's predecessor, QLT Inc. and Aegerion, Aegerion became a wholly-owned subsidiary of Novelion on November 29, 2016 (the "2016 Merger"). Aegerion had a portfolio of therapies at the Special Distribution by reorganizing its share capital so that each QLT shareholder would receive Aralez Shares (or cash in lieu, subject to proration) and a new QLT common share in exchange for each existing common share held (the "Reorganization of Share Capital") pursuant to a court-approved statutory plan of arrangement under Section 288time of the BCBCA (the "Arrangement"). The terms of the Arrangement are set out2016 Merger, but also had over $300 million in outstanding debt in the Planform of Arrangement, attachedconvertible notes. To address Aegerion's immediate financial needs, Novelion agreed to this Proxy Statement as Appendix "A".

        Undertaking the Reorganization of Share Capital should permit the Company to make the Special Distribution to the Company's shareholders without Canadian withholding taxesadvance Aegerion a secured loan of up to 25% on dividends being payable.

        See "Tax Consequences$15 million (the "Intercompany Loan") at the time the merger agreement was signed in June 2016, in order to fund Aegerion through to the November 2016 closing of the Reorganization of Share Capital". Shareholders are urged2016 Merger. The 2016 Merger was subject to obtain their own tax advice with respect toshareholder approval by Novelion's shareholders under the tax consequencesToronto Stock Exchange and Nasdaq listing requirements because of the Reorganizationsignificant share issuance that took place in conjunction with the transaction. Approximately 98% of Share Capital.

        If the Company is unable to implement the Special Distribution by a Reorganization of Share Capital, the Board may implement the Special Distribution by distributing the Aralez Shares (or cashNovelion's shareholders voted in lieu, subject to proration) to the QLT shareholders as a dividend in kind. The Company believes that for most QLT shareholders, a dividend in kind may be less tax efficient than a Reorganization of Share Capital. See "Tax Consequencesfavor of the Special Distribution if Effected as a Dividend". Shareholders are urged to obtain their own tax advice with respect to the tax consequences of a receipt of a dividend in kind having regard to their particular circumstances.

The Company believes that the tax treatment of the Reorganization of Share Capital (as compared to a dividend in kind) may be more tax efficient for most shareholders, depending on their individual tax characteristics. See "Canadian Federal Income Tax Considerations" for a summary of the differing tax considerations relevant to a QLT shareholder. Individual shareholders are encouraged to obtain their own tax advice, having regard to their particular circumstances.

The decision whether to complete the Special Distribution is entirely at the discretion of the Board and there is no requirement at law for shareholder approval of such transactions. Accordingly, at the Special Meeting, QLT shareholders are being asked to vote only on the Reorganization of Share Capital and not on the Special Distribution or the underlying transactions.2016 Merger.


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        Notwithstanding shareholder approvalIn October 2017 and again in February 2018, Novelion extended additional funds under the Intercompany Loan to address Aegerion's ongoing operating needs. However, these advances were insufficient to address Aegerion's continuing financial challenges and, therefore, Aegerion needed additional cash injections, which it sought from other lenders.

        In response to Aegerion's continued financial difficulties, in late 2017 Novelion and Aegerion began to explore options to restructure Aegerion's debt (which, to be feasible, would require negotiating with and seeking support from a majority of the Reorganization of Share Capital, the decision whether or not to complete the Special Distribution is entirely at the Board's discretion and there is no guarantee that the Special Distribution will be completed.

        Following is a summary descriptionholders of the Special Distribution.

        Pursuant to an Agreementoutstanding convertible notes) and Plan of Mergerin August 2018, Novelion and Arrangement dated June 8, 2015 and amended August 19, 2015 and December 7, 2015, Tribute Pharmaceuticals Canada Inc., an Ontario corporationAegerion jointly retained Moelis & Company LLC ("Tribute"Moelis"), and POZEN, Inc., a Delaware corporation ("POZEN") have agreed to complete a business combinationglobal investment banking advisory firm who had industry knowledge and form a combined company known as Aralez Pharmaceuticals Inc. ("Aralez"), which will be resident in Canada. In connection with the proposed transaction (the "Aralez Transaction"), the Company and an investor group led by Deerfield Private Design Fund III, L.P., Deerfield International Master Fund, L.P., Deerfield Partners, L.P. ("Deerfield") and certain other co-investors agreed to invest $75 million in new equity of Aralez, of which the Company will invest $45 million. In addition, Deerfield and/or its affiliates will invest $75 million in exchangeable notes of Aralez, and will provide a US$200 million senior secured debt facility to fund future acquisitions. These financings are scheduled to be completed simultaneously with the closingknowledge of the Aralez Transaction expected incompanies, to explore strategic options and financing alternatives for the first quarter of 2016.companies.

        In connection with the Aralez Transaction, on June 8, 2015, QLTMarch 2018, Aegerion entered into a share subscription$20 million loan and security agreement as amended on October 29, 2015with Broadfin Capital, LLC ("Broadfin") and Sarissa Capital Management LP ("Sarissa") (the "Original Aralez Subscription Agreement""2018 Term Loan") pursuant, which was subordinated in security and priority to which the Company agreed to purchase 6,250,000 Aralez Shares for an aggregate purchase priceIntercompany Loan. Broadfin and Sarissa were both shareholders of $45 million,Novelion and whose affiliates were members of the Board at a price per Aralez Share of $7.20. On December 7, 2015, the Original Aralez Subscription Agreementtime.

        Concurrent with the 2018 Term Loan, the agreement governing the Intercompany Loan was terminated and an amended and restated subscription agreement was executed (the "Amended and Restated Aralez Subscription Agreement").restated. At the time of the restatement, the outstanding balance on the Intercompany Loan had grown to approximately $38 million.

        Under the terms of the Amended2018 Term Loan and Restated Aralez Subscriptionthe amended and restated Intercompany Loan, Aegerion could not issue any additional senior debt with priority to those loans without the consent of Broadfin, Sarissa and Novelion.

        In August 2018, Aegerion initiated a cost reduction plan that included, among other things, reductions to its U.S. commercial operations, the suspension of key clinical development activities and the elimination of 36% of its workforce.

        Later that month, Aegerion retained AlixPartners, a management consulting firm that specializes in complex financial restructurings, and expanded Moelis' mandate to include the restructuring of Aegerion's debt as well as the provision of investment banking services for Aegerion.

        Moelis thereafter commenced actively identifying potential merger partners, strategic buyers and private equity firms that may have an interest in the business of Novelion and Aegerion. This process included a broad marketing effort through which Moelis reached out to more than 50 potential merger partners, strategic buyers and private equity firms, including Amryt.

        Around the same time, Aegerion also expanded the size of its board of directors (the "Aegerion Board") and brought on two new independent directors. The Aegerion Board had no overlapping directors with our Board. The post-expansion Aegerion Board was comprised of Michael Price, Barbara Chan, Mathew Cantor and Colin Adams.

        The Aegerion Board or its two independent directors, Messrs. Cantor and Adams, who served on a special transaction committee (the "Aegerion Special Transaction Committee"), met and deliberated separately from our Board throughout the fall of 2018 and continuing through 2019. Much of the Aegerion Board's deliberations (including the deliberation of any issues related to Novelion) were conducted by the Aegerion Special Transaction Committee. Novelion did not maintain or exercise any control over the Aegerion Board or the Aegerion Special Transaction Committee.

        At a meeting on September 4, 2018, our Board, after discussion and in light of Novelion's liquidity profile, determined to form its own special committee of independent directors (the "Novelion Special Committee") to explore, negotiate and recommend to our Board (if advisable and applicable) financing alternatives and transactions. Our Board appointed Dr. Bruhn, Dr. Sabba and Mr. Thomas to the Novelion Special Committee.

        Due to the inherent conflict between Aegerion and Novelion's interests as a result of Aegerion's substantial indebtedness to Novelion, at a meeting on September 24, 2018, our Board, based on the recommendation of the Novelion Special Committee, determined it would be prudent to engage an independent financial advisor to protect Novelion's interests and explore alternatives for Novelion as Aegerion explored its own strategic


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alternatives. On September 25, 2018, after interviewing several qualified parties for this role, Novelion, at the recommendation of the Novelion Special Committee and the direction of our Board engaged Evercore Inc. ("Evercore"), a global independent investment banking and financial advisory firm, in light of Evercore's expertise in the industry in which Novelion was operating and with companies facing similar financial and operational crises.

        From September 2018 through December 2018, our Board and the Novelion Special Committee met in person or by telephone regularly to discuss Novelion's and Aegerion's financial circumstances and Novelion's strategic options. Our Board and the Novelion Special Committee reviewed presentations and materials provided by Novelion's management and Evercore regarding, among other things, market conditions, financial and cash projections, potential strategic alternatives and risks and opportunities associated therewith, and the long-term sustainability of Novelion, particularly given Aegerion's financial condition and the cost and regulatory burden associated with Novelion being a public company, noting that, other than the Intercompany Loan, substantially all of Novelion's assets and liabilities were residing at the Aegerion level. Our Board was also regularly advised on its fiduciary duties by Canadian and U.S. counsel. At the direction of our Board and the Novelion Special Committee, Novelion's management and Evercore continued to explore various strategic alternatives, including financing alternatives, although at such time it was still uncertain which strategic alternatives, if any, Novelion could ultimately pursue, especially given that such a transaction would likely need to include a restructuring of Aegerion's convertible notes, which would require, to be feasible, negotiating with and seeking support from a majority of the holders of the outstanding convertible notes.

        After discussions and negotiations among Novelion, Aegerion and certain of Aegerion's lenders over the course of several weeks, on November 8, 2018, Aegerion and an ad hoc group of holders of over 67% of Aegerion's outstanding convertible notes (the "Bridge Loan Lenders" or the "ad hoc group") entered into a bridge credit agreement (the "Bridge Loan Agreement"), whereby Aegerion borrowed: (a) $50 million (the "New Money Loans"), which was to be used to (i) provide Aegerion with bridge funding to allow it to continue to operate, (ii) repay the 2018 Term Loan in an aggregate principal of approximately $21.2 million and (iii) repay a portion of the principal of the Intercompany Loan in an amount of $3.5 million; and (b) $22.5 million to repurchase and retire an equal amount of the convertible notes held at par by certain funds managed by the Bridge Loan Lenders (the "Roll Up Loans", and, together with the New Money Loans, the "Bridge Loan").

        The Bridge Loan contemplated that the New Money Loans would have priority over the Intercompany Loan, while the Roll Up Loans would be secured but subordinated to the Intercompany Loan.

        The Bridge Loan was intended to provide Aegerion with financing to support its operations while Aegerion continued to explore strategic alternatives. The Bridge Loan was not intended to be a stand-alone solution to Aegerion's financial challenges.

        With the benefit of advice from its financial and legal advisors, our Board, upon the recommendation of the Novelion Special Committee, determined that the New Money Loans being offered under the Bridge Loan offered the best path to preserve the value of the Intercompany Loan by providing Aegerion with funding to pursue strategic alternatives.

        The Novelion Special Committee and our Board believed that if the Bridge Loan could not be secured, it was likely that Aegerion would have to file for what is known as a "free fall bankruptcy" in which it would have to seek bankruptcy protection without any plan to emerge from that process. If that were to occur, the Novelion Special Committee and our Board believed there would almost certainly be significant value erosion with the risk that creditors of Aegerion, including Novelion, would receive little or no recovery.

        Accordingly, Novelion provided consent to the Bridge Loan and agreed to subordinate the Intercompany Loan to the New Money Loans pursuant to a subordination agreement entered into on November 8, 2018 (the "Subordination Agreement").

        On the same day that Novelion entered into the Subordination Agreement, QLT will now acquire $45Novelion issued a press release that Aegerion had entered into the Bridge Loan Agreement and that Novelion and Aegerion were working through strategic alternatives. In particular, Novelion disclosed that Aegerion had engaged Moelis and AlixPartners, both of whom advised on the Bridge Loan, to continue the comprehensive review of Aegerion's capital structure, and that Novelion and Aegerion had also engaged Evercore and Moelis, respectively, to


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explore and advise the companies on all available financial and strategic options, such as a restructuring of Aegerion's outstanding convertible notes (including a restructuring that would likely involve a debt for equity swap), a possible sale or merger of Novelion or Aegerion, or the sale or other disposition of certain businesses or assets, including territorial licensing deals.

        At this time, Aegerion was facing imminent debt maturities. Aegerion's upcoming obligations totaled approximately $412.6 million:

        Aegerion did not have the ability to repay these obligations, nor did it have the ability to fund its ongoing operations. Consequently, Aegerion and Novelion continued to work with Moelis to pursue strategic alternatives and actively marketed the business for investment or sale as a means of addressing its financial concerns.

        On November 20, 2018, Novelion, at the direction of our Board, issued a press release announcing that a strategic transaction may require Novelion and/or Aegerion to seek protection under U.S. or Canadian bankruptcy laws, in particular reiterating that Aegerion had engaged Moelis and AlixPartners, both of whom advised on the recently announced Bridge Loan, to continue the comprehensive review of Aegerion's capital structure, and that Novelion and Aegerion had also engaged Evercore and Moelis, respectively, to explore and advise the companies on all available financial and strategic options, such as a restructuring of Aegerion's outstanding convertible notes (including a restructuring that would likely involve a debt for equity swap), a possible sale or merger of Novelion or Aegerion, or the sale or other disposition of certain businesses or assets, including territorial licensing deals. Such disclosure cautioned investors that "effecting such a refinancing, restructuring, or other wholesale recapitalization or other strategic alternative (and some of these alternatives could potentially lead Novelion and/or Aegerion to seek certain protections afforded under law, including the bankruptcy laws of the Aralez Transaction,United States and Canada) will be critical for us to continue to execute on our commercial strategy and pursue our goals and objectives, and we may not be successful in doing so."

        At a meeting held on December 17, 2018, our Board discussed, with its financial and legal advisors, that of the more than 50 parties contacted in connection with Novelion's and Aegerion's review of strategic alternatives, only Amryt and one other strategic party ("Party A") had emerged as a potential viable acquiror or merger partner, though Party A had only recently expressed an interest and had not yet submitted a proposal. Our Board also discussed Aegerion's potential restructuring alternatives and the potential impact to Novelion, including a sale of Novelion and/or Aegerion, pursuit of a standalone plan, and a free-fall bankruptcy event, and the status of ongoing discussions with the ad hoc group. Our Board authorized management and its advisors to continue to engage in discussions with Amryt and Party A regarding a business combination.

        Over the next several weeks, Novelion, Aegerion, Amryt, Party A and the ad hoc group continued discussions and negotiations and our Board continued to hold meetings to discuss Novelion's and Aegerion's review of strategic alternatives and the liquidity needs of Novelion and Aegerion, including Aegerion's upcoming debt maturities, as well as certain cost-sharing provisions between Novelion and Aegerion to memorialize the allocation of certain operational services and the costs associated therewith as between the two companies. Although during this time Party A submitted a proposal for a merger transaction, such proposal considerably undervalued the Company and, after further negotiations and due diligence, Party A was unable to make a proposal that was amenable to Novelion, Aegerion or the ad hoc group and discussions with Party A ceased.

        On February 17, 2019, the ad hoc group informed Novelion that it was supportive of pursuing a business combination with Amryt in lieu of an alternative involving the standalone plan and submitted two proposals in connection with a business combination involving Amryt, which were reviewed by our Board at a price per share equalmeeting held on February 21, 2019, one for a business combination between Amryt and Aegerion, and the other focused on the treatment of Novelion's claims and pro forma arrangement between the ad hoc group and Novelion. At this


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meeting, our Board noted that the proposals ascribed no value to Novelion's Nasdaq listing, which was inconsistent with prior discussions among the ad hoc group, Aegerion, Novelion and Amryt. Our Board discussed the importance of securing favorable treatment for the Intercompany Loan and instructed its advisors and management to (x) negotiate with the ad hoc group on the proposal for the treatment of the Intercompany Loan and the proposed equity split of the company that would be surviving the business combination and (y) continue discussions and negotiations with the ad hoc group, Aegerion and Amryt regarding a business combination with Amryt, and on a fair cost-sharing arrangement between Novelion and Aegerion.

        The parties continued discussions and negotiations and in early March 2019, Aegerion, Amryt and the ad hoc group held an in-person meeting and thereafter informed Novelion that the ad hoc group, Aegerion and Amryt were going to pursue a business combination that did not involve Novelion, whereby a transaction would be effected through a chapter 11 plan of reorganization by Aegerion, which transaction would include the business combination of Amryt and Aegerion without the need for a Novelion shareholder vote. At a meeting held on March 8, 2019, our Board discussed this new proposal and the importance of negotiating the best terms available for the treatment of the Intercompany Loan and finalizing negotiations of cost-sharing arrangements between Novelion and Aegerion.

        From March 2019 through May 2019, the ad hoc group, Aegerion and Amryt negotiated the business combination and Novelion negotiated with the ad hoc group, Aegerion and Amryt as to the treatment of the Intercompany Loan and the equity split of the post-transaction Amryt, and to reach the final structure of the proposed restructuring plan that would be implemented through a chapter 11 bankruptcy process, referred to herein as the Aegerion Recapitalization.

        Our Board remained actively engaged throughout this period. Between January and May 2019, our Board and its legal and financial advisors met 14 times, in person or by telephone, to review and critically examine Aegerion's financial circumstances and the options available to Novelion, including the Aegerion Recapitalization and Novelion's advisors negotiated the most favorable terms available for the Intercompany Loan, including the post-closing Amryt equity split, and for the cost-sharing arrangement between Novelion and Aegerion.

        On May 20, 2019, our Board held a meeting to consider the terms of the Aegerion Recapitalization and determined to support the Aegerion Recapitalization and enter into the restructuring support agreement in connection therewith. Our Board determined to support the Aegerion Recapitalization because it would address Novelion's financial interests in the following ways:

        In determining to support the Aegerion Recapitalization and enter into the corresponding restructuring support agreement, our Board also noted that the Aegerion Recapitalization would provide four key benefits to Novelion:


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        Our Board also noted that Aegerion's agreement with Amryt included a "go shop" provision that allowed Aegerion, with the assistance of the Aralez Transaction, notits financial advisor Moelis, to be less than $6.25, multiplied by (b) 0.1455 (the "Per Share Consideration"). In the event Tribute, Pozen or Aralez announceshop for a material event (other than the results of any shareholder meeting) during the ten day period immediately precedingmore favorable deal prior to the closing of the Aralez Transaction, clause (ii) above shallAegerion Recapitalization, which could benefit Novelion if another viable suitor were to emerge who was interested in a business combination involving Novelion or otherwise assigned value to Novelion beyond the Intercompany Loan, noting, though, that it appeared unlikely that any prospective buyer of Novelion would be revised to read, "a 5% discount offidentified given the two day VWAP per share of Pozen Common Stock, calculated overbroad and public process Novelion had undertaken without identifying any interested buyer or merger partner for Novelion previously. At this meeting, our Board also discussed that following the two trading days immediately preceding the date of closing of the Aralez Transaction, notAegerion Recapitalization, at which point Novelion would be an Amryt shareholder, the combined Aegerion/Amryt businesses will have a larger suite of drug products, a substantially reduced debt load, fresh liquidity to operate and no imminent debt repayments.

        On May 20, 2019, the parties entered into the Aegerion Recapitalization. In its press release on May 21, 2019 announcing the Aegerion Recapitalization, Novelion stated that in furtherance of its duty to maximize value for its shareholders, our Board, together with its management team and legal and financial advisors, would be less than $6.25"evaluating post-closing plans with respect to Novelion, including a potential wind-up of Novelion and a distribution of assets to shareholders.

        Between May 2019 and September 2019, our Board met several times, including with its legal and financial advisors, to discuss the potential strategic alternatives available to Novelion after the consummation of the Aegerion Recapitalization and of the costs and benefits of continuing its operations, including the substantial accounting, legal and other expenses associated with being a small publicly-traded company with limited assets and no source of revenue, and of additional factors more fully described in "— Reasons for the Proposed Dissolution and Liquidation. The Tribute Shares acquired" During this period, Evercore, at the direction of our Board explored the possibility of a reverse merger or similar transaction involving Novelion or its assets; however, no merger partner or other buyers were identified. At a meeting held on September 18, 2019, our Board determined that the Liquidation is advisable and in the best interests of Novelion and its shareholders. In furtherance of these efforts, our Board is presenting the Liquidation Plan for approval by QLT will be exchangedNovelion's shareholders.


Reasons for Aralez Shares pursuantthe Proposed Dissolution and Liquidation

        As part of Novelion's review of strategic alternatives and evaluation process, and in connection with and leading up to the Aralez Transaction. AsAegerion Recapitalization, our Board considered the risks and viability of each alternative potentially available to Novelion, as well as management's financial and cash projections, and consulted with management and Novelion's legal and financial advisors. In arriving at its determination that the Liquidation Plan is advisable and in Novelion's best interests and the best interests of Novelion's shareholders, and is the preferred and only viable strategic option for Novelion after the consummation of the Aegerion Recapitalization, our Board considered the foregoing, as well as the following factors:


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        Our Board also considered the following risks in arriving at its conclusion that liquidating, winding up and dissolving Novelion is in Novelion's best interests and the Toronto Stock Exchange.best interests of Novelion's shareholders:

        Our Board also considered the other factors described in the section entitled "Risk Factors" in this Proxy Statement and in those risk factors identified in Novelion's filings with the SEC.

        In view of the variety of factors considered in connection with its evaluation of the Liquidation Plan, our Board did not find it practical, and did not quantify or otherwise attempt, to assign relative weight to the specific factors considered in reaching its conclusions. In addition, our Board did not undertake to make any specific determination as to whether any particular factor, or any aspect of any particular factor, was favorable or unfavorable to its ultimate determination, but rather conducted an overall analysis of the factors described above. In considering the factors described above, individual members of our Board may have given different weight to different factors.

        Novelion cannot offer any assurance that the value of any liquidation distributions will equal or exceed the price or prices at which shares of the Company's common stock have recently traded at or could trade at in the future. However, our Board believes that it is in Novelion's best interests and the best interests of Novelion's shareholders to distribute to the shareholders of Novelion net assets pursuant to the Liquidation Plan. If Novelion's shareholders do not approve the Liquidation Plan, our Board will explore what, if any, alternatives are available in light of Novelion's limited business activities, limited resources and operations, limited assets and that Novelion has no source of revenue.

        Possible remaining strategic alternatives would include seeking voluntary dissolution with the BC Supreme Court approval at a later time and with diminished assets. At this time, our Board has considered all strategic options and has determined that it is in Novelion's best interests and in the best interests of Novelion's shareholders to dissolve Novelion and distribute any remaining assets or cash to Novelion's shareholders. Our Board, however, retains the right to consider other alternatives and abandon the Liquidation Plan prior to the Effective Date should a more beneficial alternative arise before the Effective Date.


Overview of Liquidation

        The Company intends, followingBoard proposes the purchasevoluntary liquidation, winding up and dissolution of the Aralez SharesCompany (the "Liquidation") pursuant to effectsection 319(1) of the Special DistributionBCBCA, which wouldLiquidation will become effective and commence at a time to be determined by the Board (the "Effective Date"), in accordance with the Liquidation Plan. The Board intends to set the Effective Date in the statement of intent to liquidate to be filed by the Company under the BCBCA. For a special distributionbrief summary of the steps required to each of its shareholders payable atcomplete the electionLiquidation and the anticipated timing of each such shareholder, in either Aralez Shares or cash, subjectstep, see "— Overview of Steps to proration as may be necessary to reflect a maximum cash componentComplete the Liquidation and Dissolution" beginning on page 40 of $15 million. The entitlement of a QLT shareholder to a portion of the Aralez Shares (or cash in lieu thereof, subject to proration) will be determined on a pro rata basis based on the number of Aralez Shares acquired by QLT pursuant to the Amended and Restated Aralez Subscription Agreement and the number of QLT shares outstanding on the record date determined for the Special Distribution (the "Aralez Share Exchange Ratio").

        The $15 million cash component would be funded exclusively pursuant to the terms of the Backstop Agreement, as described below. Following the expiry of the election period within which QLT's shareholders will have an opportunity to make their elections, QLT will determine the number of Aralez Shares to be distributed to each of its shareholders and the number of Aralez Shares to be sold to certain other parties for cash pursuant to the terms of the Backstop Agreement. Details of the election process for the Special Distribution are provided under the heading below "Details of the Election For the Special Distribution". A QLT shareholder that elects to receive cash in lieu of all or part of their entitlement to Aralez Shares will only receive such cash if the transactions contemplated by the Backstop Agreement complete. In the event these transactions do not complete, a QLT shareholder that elects to receive cash in lieu of all or part of their entitlement to Aralezthis Proxy Statement.


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Shares will, notwithstanding such an election, receive Aralez Shares instead. Details        A portion of the Backstop Agreementdistributions to be made to registered shareholders of the Company may be by way of a reduction of capital, to the extent the solvency requirements of the BCBCA and theBankruptcy and Insolvency Act (Canada) are providedsatisfied at the time of distribution. See "Liquidation Distribution(s)" beginning on page 38 of this Proxy Statement. The Liquidation and the Liquidation Plan require shareholder approval by a special resolution of the Company's shareholders. In addition, the Company will need to obtain shareholder approval by an ordinary resolution in order to appoint the Liquidator and authorize the Board to set such Liquidator's remuneration. The Board has determined that the liquidation and dissolution pursuant to the Liquidation Plan, described in this Proxy Statement, is advisable and in the best interests of the Company, its shareholders and its stakeholders, and have approved the Liquidation and the Liquidation Plan, which is to become effective and commence at a time to be determined by the Board, subject to shareholder approval. The Board recommends that shareholders of the Company vote in favor of (i) the Liquidation Resolution, the full text of which is set forth on page 48 of this Proxy Statement and (ii) the Liquidator Resolution, the full text of which is set forth on page 49 of this Proxy Statement. Capitalized terms used below and not otherwise defined have the meaning given to them in the Liquidation Plan.


Liquidation and Dissolution Procedure

        If the Liquidation and the Liquidation Plan are approved at the Annual Meeting, the Company will, as soon as practicable, sign the Liquidation Plan and will file a statement of intent to liquidate with the British Columbia Registrar of Companies.The Liquidation Plan provides that it will become effective as of the Effective Date (which is a date to be determined by a resolution of the Board, in its discretion, which date shall be the date established as the date for commencement of the liquidation and winding up in the statement of intent to liquidate that is filed by the Company pursuant to and in accordance with the BCBCA.

        The full text of the Liquidation Plan is attached hereto as "Schedule A — Plan of Liquidation and Distribution" and shareholders are urged to read the Liquidation Plan in its entirety. The description of the Liquidation Plan below is a summary and is qualified in its entirety by the more detailed information contained in Schedule A. The entering into of the Liquidation Plan will have a number of consequences effective as of the Effective Date, including but not limited to the following:

        The Liquidation Plan may be amended in accordance with its terms, which provide:


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        Following the Effective Date, the Liquidator will oversee the Liquidation. The Liquidator's powers and authorities are derived from the BCBCA, the Liquidation Plan and the terms of any BC Supreme Court orders pertaining to the Liquidation. See "The Backstop AgreementSchedule A — Plan of Liquidation and Distribution".

        PursuantIf the Liquidation Plan and the appointment of the Liquidator are approved at the Annual Meeting, the steps set forth below will be completed following the Effective Date at such times as the Liquidator or the BC Supreme Court, as applicable, deems necessary, appropriate or advisable, all in accordance with the Liquidation Plan and the BCBCA:

See "— Overview of Steps to Complete the Liquidation and Dissolution" for a brief summary of the steps required to complete the Liquidation and the anticipated timing of each step.


Trading of Common Shares

        On August 21, 2019, the Company received a letter (the "Nasdaq Letter") from the Listing Qualifications Staff ("Staff") of The Nasdaq Stock Market LLC ("Nasdaq"), notifying the Company that no Canadian hold period will applyNasdaq has determined to delist the Aralez Shares issued to QLTCompany's common stock from Nasdaq pursuant to the plan of arrangement as described inStaff's discretionary authority under Listing Rule 5101. The Nasdaq Letter stated that the Tribute Circular, including the conditions described therein. See the heading below "Documents Incorporated by Reference". Similarly, no Canadian hold period will apply to the Aralez Shares distributed to QLT shareholders.

The Backstop Agreement

        The Company entered into an agreement (the "Backstop Agreement") dated June 8, 2015 and amended December 7, 2015 with each of the following co-investors (the "Co-Investors"): Broadfin Healthcare Master Fund Ltd., JW Partners, LP and JW Opportunities Master Fund Ltd. Pursuant to the Backstop Agreement, the Co-Investors agreed to purchase from the Company, within three business days of the expiration of the election period for the Special Distribution, those Aralez SharesStaff's determination was based on its belief that the Company shareholders have electedhas no current operating business and has not to receive in the Special Distribution, up to a maximum of $15 million of Aralez Shares. The per share price to be paid by the Co-Investors in exchange for the Aralez Shares will be equal to the Per Share Consideration. As a result, QLT shareholders will be able to elect to receive their respective pro rata entitlement of the Special Distribution in cash instead of Aralez Shares, up to an aggregate amount of $15 million (the "Maximum Cash Amount").

        The Company's ability to distribute the Maximum Cash Amount topublicly disclosed its shareholders is entirely dependent onfuture business operations following the completion of the transactions under the Backstop Agreement. In the event the sale of Aralez Shares to the Co-Investors under the Backstop Agreement does not complete for any reason, QLT shareholders will receive their entire pro rata entitlement to the Special Distribution in Aralez Shares, notwithstanding that they may have elected to receive cash instead.

        Subject to receiving shareholder approval of the Reorganization of Share Capital at the Special Meeting, the Company intends to implement the Special Distribution as a Reorganization of Share Capital pursuant to the Plan of Arrangement. If QLT shareholder approval of the Reorganization of Share Capital is not obtained at the Special Meeting, the Board intends to effect the Special Distribution by distributing the Aralez Shares, and/or cash in lieu, to the QLT shareholders as a dividend in kind. The Company believes that for most shareholders, a dividend in kind may have less efficient tax consequences than the Reorganization of Share Capital. See the heading below "Tax Consequences of the Special Distribution if Effected by a Dividend". Shareholders are urged to obtain their own tax advice with respect to the tax consequences of a receipt of a dividend in kind having regard to their particular circumstances.

Details of the Election For the Special Distribution

        The Board will set a record date for the purpose of determining the QLT shareholders entitled to participate in the Special Distribution, following which, the Company's registrar and transfer agent, Computershare Investor Services Inc. ("Computershare"), will mail those shareholders an election form providing the opportunity to elect to receive their pro rata entitlement of the Special Distribution in cash up to the Maximum Cash Amount, subject to proration. The QLT shareholders will have a period of time (to be specified on the election form) within which to return their election forms to Computershare. The QLT shareholders who (i) do not elect to receive their pro rata entitlement of the Special Distribution in cash, or (ii) do not return the completed election forms to Computershare within the specified time, will following the expiry of the election period receive such number of Aralez Shares reflecting their pro rata entitlement of theAegerion Recapitalization.


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Special Distribution        The Nasdaq Letter also stated that the Company's delay in filing its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 serves as an additional basis for delisting the Company's securities from Nasdaq. Nasdaq Listing Rule 5250(c)(1) requires companies to timely file all required periodic financial reports with the SEC. Previously, and as required, on August 12, 2019, the Company filed a Form 12b-25 with the SEC which reported that it would not be in a position to timely file the Form 10-Q because of the significant work required to effect the deconsolidation and the other demands associated with the Chapter 11 Proceedings.

        The Nasdaq Letter further stated that the Company may appeal the Staff's determination to a Hearings Panel (the "Panel"), pursuant to the procedures set forth in the Nasdaq Listing Rules and that if the Company requested a hearing, it may also request an extended stay of the suspension of the trading of the Company's common stock, pending the hearing.

        The Company submitted an appeal of the Staff's decision prior to the deadline to appeal on August 28, 2019 pursuant to the procedures set forth in the Nasdaq Listing Rules, and to request an extended stay of the suspension of the trading of the Company's common stock in connection therewith. The Panel granted a stay of the delisting of the Company's common stock from The Nasdaq Stock Market in response to the Company's request for a hearing and scheduled a hearing for October 3, 2019. Further, on September 9, 2019, the Panel granted the Company's request to extend the 15-calendar day stay of the suspension from Nasdaq, pending the hearing scheduled for October 3, 2019 and a final determination regarding the Company's listing status.

        Although Novelion is appealing to the Panel to permit the shares of Novelion to continue to trade on Nasdaq at least through the date of the Annual Meeting, or through a subsequent date following the Annual Meeting, Novelion can make no assurance as to when the Novelion shares will be delisted from Nasdaq (or what trading halts may be imposed). Following any such delisting, the common shares of Novelion will no longer be listed for trading on Nasdaq or on any stock exchange and may only trade in the U.S. on the over-the-counter market, which is a less liquid market, if at all.

        Regardless of the foregoing, we anticipate that any and all trading of our common shares on Nasdaq or the over-the-counter market, as the case may be, will be suspended as of the Effective Date or as soon thereafter as is reasonably practicable, and that we will close our stock transfer books and discontinue recording transfers at that time. Accordingly, it is expected that trading in our shares of common stock will cease after the Effective Date. The Liquidation Plan provides that any liquidation distributions made to shareholders of Novelion will be made only to those shareholders who are registered shareholders as of the Effective Date, though liquidation distributions may take place long after the Effective Date has passed.


Claims Process

        A BC Supreme Court approved Claims Process will be established following the successful application to the BC Supreme Court under section 325(1) of the BCBCA for the identification, resolution and barring of Liquidation Claims (the "Claims Process"). The Company anticipates seeking BC Supreme Court approval of a Claims Process as soon as reasonably practicable after the Effective Date. The Claims Process will include the provision of written notice of the commencement of the Liquidation to all known creditors of the Company, including its employees, and its present or former officers and directors. Such notice will be published in major newspapers in Canada and the U.S. and will be sent by the Liquidator to known and potential creditors based on the Aralez Share Exchange Ratio. The QLT shareholders who elect to receive their pro rata entitlementCompany's books and records, informing them of the Special Distribution in cashLiquidation and stating that any Liquidation Claims must be filed with the Liquidator so that they are received by the deadline stated within the letter, which the Company anticipates will be 120 days after the initial BC Supreme Court approval of the Claims Process is obtained, which is consistent with the time periods required pursuant to section 331 of the BCBCA. Shareholders of the Company are hereby notified of the Claims Process and should review the Company's future press releases (filed onwww.sedar.com and onwww.sec.gov/edgar/) and/or the Liquidator's website for further details at:www.alvarezandmarsal.com/novelion.

        The Claims Process will request expedited hearings of any disputed Liquidation Claims by the BC Supreme Court, but there are no assurances as to the number of Liquidation Claims that may be filed, the monetary amount of such Liquidation Claims and the amount of time such Liquidation Claims will require for resolution.


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        The Claims Process described above is intended to fully and finally determine all claims against the Company. A court order will be sought that any claims not submitted pursuant to the Claims Process will be fully and finally barred (the "Claims Bar Order") with the intention that no claims should be pursued following the expiryLiquidation of the election period and assuming completionCompany. However, there is no absolute certainty that the risk of claims arising after the Liquidation of the saleCompany will be eliminated completely. See "— Distribution of Assets —Potential Liability of Shareholders" below.


Distribution of Assets

Liquidation Distribution(s)

        The following discussion assumes that the Liquidation Plan will be approved by the shareholders of the Aralez SharesCompany. If the Liquidation Plan is not approved by the shareholders of the Company or otherwise approved by the BC Supreme Court, no Liquidation distributions will be made pursuant to the Co-Investors underLiquidation Plan.

        Pursuant to the Backstop Agreement, receive such numberLiquidation Plan, the Liquidator is authorized and empowered, but not obligated, to cause the Company to sell any of Aralez Shares and/its assets, including the Amryt Equity and, after paying or making reasonable provision for the payment of Liquidation Claims against and obligations of the Company as required by law and once it has obtained all required tax clearance certificates, distribute any remaining assets or cash reflecting their pro rata entitlement to the Special Distribution, subject to the Maximum Cash Amount. In the event the saleShareholders as a reduction of Aralez Shares to the Co-Investors under the Backstop Agreement does not complete, QLT shareholders will receive only Aralez Shares notwithstanding that they have elected to receive cash instead. The Board believes that the Special Distribution will provide QLT's shareholders with the opportunity to participate in the growthcapital and/or as a dividend. Amounts distributed by way of a newly formed, exceptionally managed, commercial-stage, Canadian-resident, specialty pharmaceutical company, Aralez Pharmaceuticals Inc.

        Further disclosure on Aralez is containedreduction of capital may, in certain circumstances, be received tax free by the Aralez Registration Statement andshareholders of the Tribute Circular which are incorporated by reference and are available on Tribute's SEDAR profile at www.sedar.com.Company. See the heading below ""— Documents Incorporated by ReferenceCertain Material Canadian Federal Income Tax Considerations".

        As noted above,The Company will continue to defend any proceedings commenced against it, and incur claims, liabilities and expenses (such as salaries and benefits, directors' and officers' insurance, payroll and taxes, legal, accounting and consulting fees and miscellaneous office expenses) following approval of the Aralez TransactionLiquidation Plan and during the period following the Effective Date until the Liquidation of the Company is subjectcomplete. Satisfaction of these claims, liabilities and expenses will reduce the amount of assets available for ultimate distribution to athe registered shareholders of the Company.

        In order to reduce its expenses, and in connection with the Aegerion Recapitalization, the Company will decrease the number of conditions, many of which are outside the control of QLT. The Special Distributionfull-time employees to three and its administrative (i.e., IT support, office space, expense reporting, payroll) expenses will decrease substantially. In addition, Amryt has agreed to reimburse us for certain compensation and benefits that we will be effected onlypaying to two of the three remaining employees starting at the closing of the Aegerion Recapitalization until the earlier of each employee's last date of employment with the Company and December 31, 2019, in exchange for such employee's providing executive and transitional services to Amryt during such period. Under this agreement, Amryt will also provide us with accounting and SEC reporting support, if requested, for an agreed monthly fee, and administrative support at no cost. We further expect that as of the Effective Date or soon thereafter, the Company will not have any full-time employees. Additionally, as set forth under "Proposal No. 3: Election of Directors", in connection with the Annual Meeting, the Board will be streamlined to consist of three directors, two of whom will be independent, reducing the amount of director compensation the Company will be responsible for. Upon the Effective Date, the Board will be deemed to have resigned and all powers of the Board will cease. Lastly, following the completion of the issuanceAegerion Recapitalization, the Company will terminate all contracts and relationships with vendors that are not related to the Liquidation and/or continued compliance with applicable law throughout the implementation of Aralez Sharesthe Liquidation. Thus, other than executive and employee salaries and severance, and related costs, the Company expects that, after the Aegerion Recapitalization, its primary ongoing expenses will consist of legal expenses, auditor expenses and other administrative costs.

        Given that the Company currently expects that the liquidation distributions will consist almost entirely of the Amryt Equity (which is publicly traded), any remaining proceeds from the sale of a portion of the Amryt Equity by the Company in order to QLTfund the Company's expenses, including the expenses of the Liquidation, or a combination thereof, net of the Company's liabilities, the Company cannot predict with certainty the value of any liquidation distributions to its shareholders. Accordingly, you will not know the amount of any liquidation distributions you may receive as a result of the Liquidation Plan when you vote on the Liquidation Resolution. Many of the factors influencing the value of the liquidation distributions cannot currently be quantified with certainty and are subject to change, including the amount of cash the Company will need to fund the liquidation,


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the amount of Amryt Equity that will need to be sold by the Company in connection with such funding and the formal approvalproceeds received therefrom, and the value of the Amryt Equity, which is dependent upon the business operations and financial success of Amryt and is subject to market fluctuations and volatility among other risks over which we have no control, the Company's inability to predict the amount of its remaining liabilities or the amount that the Company will incur during the course of the Liquidation, the net value, if any, of its remaining non-cash assets and the fact that, if the Liquidation and Liquidation Plan are approved, the Liquidator will have the power and authority to approve the number, amount and timing of distributions, which will consist almost entirely of Amryt Equity, any remaining proceeds from the sale of a portion of the Amryt Equity by the BoardCompany in order to fund the Company's expenses, including the expenses of the Special Distribution, includingLiquidation, or a combination thereof, net of the establishmentCompany's liabilities. In addition, the timing and amount of any distributions may be impacted by (i) the Company's and/or the Liquidator's discussions with the CRA (as defined herein) and other applicable taxation authorities in finalizing the Company's and its subsidiaries final tax returns and the amounts of their corresponding tax liabilities and (ii) the number and complexity of claims resulting from the Claims Process and whether any disputed claims can be reserved for or processed in an expedited manner. There is no guarantee of the value of any distribution.

        Based upon the foregoing, Liquidation distribution(s), if made, may be comprised of cash or may be distributions of assets, such as the Amryt Equity, in kind, payable as a record date for such purposes. If the Aralez Transaction is not completed, and therefore QLT does not receive the Aralez Shares, the Special Distribution will not occur. In addition,return of capital. Following the completion of the sale of Aralez SharesClaims Process, the Company expects to issue a press release as to the Co-Investors to fund the Maximum Cash Amount is subject to conditions which are outside the controlestimated amount, character and timing of QLT, as set out above. If, for any reason, the saleLiquidation distributions.The Liquidator's website (www.alvarezandmarsal.com/novelion) will also include periodic updates in respect of the Aralez Shares to the Co-Investors does not complete, QLT shareholders will receive only Aralez Sharesestimated amount, character and will not be entitled to the Maximum Cash Amount.timing of any Liquidation distributions


Uncertainty of Liquidation Distribution Amounts

        The Company may be subject to contingent claims including lawsuits. If such contingent claims are determined to be valid, the Company could be required to pay significant amounts to these contingent claimants and, even if it is successful in defending such claims, the Company could incur significant legal costs to do so, either of which could result in a significant reduction in the amount available to be distributed to its shareholders and/or a significant delay in the timing of any such distribution.

        As a result, the amount of cash and/or assets to be distributed to shareholders as Liquidation distributions cannot currently be quantified with certainty and is subject to change.Accordingly, you will not know the amount of any Liquidation distributions you may receive as a result of the Liquidation Plan when you vote on the proposal to approve the Liquidation Plan. You may receive substantially less than your pro rata share of the net assets of the Company, as set out on its most recent balance sheet. In addition, as disclosed in the Company's press release of August 12, 2019, due to the need to deconsolidate the Company's financial statements from those of Aegerion, the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 may not be completed and published prior to the date of the Annual Meeting. The Company currently believes that the Liquidator will complete distributions by the fourth quarter of 2020, subject to the resolution of claims. The amount and timing of any distribution has not been determined.


Potential Liability of Shareholders

        Under the BCBCA, despite the Liquidation, each shareholder of the Company to whom any of its property has been distributed is potentially liable, for a period of two years, to any person claiming under section 346 of the BCBCA to the extent of the amount received by that shareholder upon the distribution, and an action to enforce such liability may be brought.

        Section 346 of the BCBCA provides that, despite the dissolution of a company under the BCBCA:

    a civil, criminal, quasi-criminal, administrative or regulatory action or proceeding (each, a "legal proceeding") that was commenced by or against a company before its dissolution may be continued as if the company had not been dissolved; and

    a legal proceeding may be brought against a company within two years after its dissolution, as if the company had not been dissolved.

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    A shareholder will not be liable under Section 346 of the BCBCA unless (a) in the case of a legal proceeding that is ongoing, such shareholder is added as a party to the legal proceeding within two years after the date on which the Company is dissolved, or (b) if a judgement is obtained in a legal proceeding described above, the judgment creditor brings a legal proceeding against such shareholder within two years after the date on which the Company is dissolved.

            Under Section 101 of theBankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended, if a distribution is made to shareholders of the Company (i) at a time when the Company is insolvent; or (ii) that renders the Company insolvent, a court may, in certain circumstances, give judgment against a shareholder who received such distribution in the amount of the distribution received and interest thereon.

            The Claims Process described under the heading "— Claims Process", including the Claims Bar Order, is intended to mitigate the risk that any claims may arise following the Liquidation of the Company, but there is no absolute certainty that this risk will be eliminated completely.


    Overview of Steps to Complete the Liquidation and Dissolution

            Assuming that the Liquidation is approved by the shareholders of the Company at the Annual Meeting and the Aegerion Recapitalization is completed on or about [    ·    ], 2019, the following is a chronological list of the principal steps required to complete the Liquidation and the expected timing. There can be no assurance that the steps listed below and discussed in greater detail elsewhere in this Proxy Statement will occur within the timeframes noted below.

    StepExpected Timing
    Effective Date for LiquidationAs soon as reasonably practicable after the Annual Meeting (and, in any event, within 90 days of the closing of the Aegerion Recapitalization).

    Application to the BC Supreme Court for an order approving the Claims Process and for such other orders and directions as may be deemed necessary.


    As soon as reasonably practicable following approval of the Liquidation Resolution and the Liquidator Resolution.

    Establishment of the Claims Process


    As soon as reasonably practicable once the BC Supreme Court so orders.

    Completion of Claims Process


    The Claims Bar Date is estimated to be 120 days following the date of the BC Supreme Court order approving the Claims Process, which is consistent with the time periods required pursuant to section 331 of the BCBCA. The completion of the Claims Process will depend on the number and complexity of the Liquidation Claims filed in the Claims Process and any appeals thereof.

    Trading of Common Shares on Nasdaq ceases


    The delisting of the common shares of the Company from Nasdaq, as described under the heading "— Trading of Common Shares", unless sooner delisted in connection with the hearing scheduled with the Nasdaq Hearing Panel on October 3, 2019

    Application to cease being a reporting issuer


    Timing to be determined by the BC Supreme Court or the Liquidator, as appropriate; however, the Company anticipates that, subject to the BC Supreme Court's discretion, such application would be made as soon as possible after the commencement of the Liquidation, but there can be no assurances regarding how long the Company may continue to be a reporting issuer.

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    StepExpected Timing
    If the Liquidation Plan is approved, the Company will seek relief from the SEC or otherwise initiate steps to exit from certain reporting requirements under the Exchange Act. However, such process may be protracted or the SEC may not grant any such relief, or, if relief is granted, the Company may be required to continue to file Current Reports on Form 8-K to disclose material events, including those related to the Liquidation.

    Distributions


    Expected during the fourth quarter of 2020, subject to resolution of outstanding claims.

    Completion of Liquidation (including preparation of final accounts of the Liquidation and notice to shareholders), per Section 341 of the BCBCA


    Within 3 months after making the final distribution to Shareholders (the "3 Month Period").

    Application to the BC Supreme Court for an order approving the dissolution of the Company, per Section 342 of the BCBCA


    Promptly after the expiry of the 3 Month Period.

    Application for dissolution to BC Companies Registrar, per Section 343 of the BCBCA


    Promptly after receipt of the BC Supreme Court order approving dissolution.

    Completion of dissolution


    As specified in Section 343 of the BCBCA.


    Interests of the Company's Directors and Executive Officers in the Liquidation

            Some of our directors and executive officers may have interests in the Liquidation that are different from, or in addition to, the interests of our shareholders generally, namely, the Company's continuing indemnification obligations to its directors and officers. The Board was aware of these interests and considered them, among other matters, in approving the Liquidation pursuant to the Liquidation Plan and the transactions contemplated thereby. While our executive officers may be entitled to certain single and double trigger change in control payments or benefits in connection with the Aegerion Recapitalization, the Liquidation will not give rise to any incremental compensation, severance or change in control benefits for our directors or officers.

    Stock Ownership

            Certain members of the Board and our executive officers own, as of September 13, 2019, an aggregate of 27,419 common shares of the Company. In connection with any liquidation distributions, certain of our directors and our executive officers will be entitled to the same pro rata cash distributions as our shareholders based on their ownership of common shares of the Company. See "Security Ownership of Certain Beneficial Owners and Management" beginning on page 66 of this Proxy Statement for a table setting forth the number of common shares of the Company beneficially owned by each of our directors and executive officers as of September 13, 2019.

    Indemnification of Directors and Officers

            The Company will continue, until the completion of the Liquidation, to indemnify and provide for advancement of expenses to its officers, directors, employees, agents and representatives in accordance with the Company's organizational documents, any contractual arrangements and applicable law, for acts or omissions of such persons in connection with the implementation of the Liquidation Plan and the winding up of the affairs of the Company. The Company's obligation to indemnify (or advance expenses to) such persons may also be satisfied out of insurance proceeds.

            The Board or any trustee(s) or agent(s) as may be appointed by the Board under the Liquidation Plan, as applicable, is authorized to obtain and maintain insurance as may be necessary, appropriate or desirable to cover


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    the Company's obligations under the Liquidation Plan, including its existing directors' and officers' liability insurance policy or any replacement policy.


    Certain Material Canadian Federal Income Tax ConsequencesConsiderations

            The following is a summary as at the date of this Proxy Statement, describes the principal Canadian federal income tax consequencesconsiderations generally applicable under the Tax Act to a QLT shareholder that disposes of QLT common shares ("QLT Shares") in the Reorganization of Share Capital or that receives the Special Distribution as a dividend-in-kind and, who at all relevant times, for purposesshareholders of theIncome Tax Act (Canada) (the "Act"), (i) deals at arm's length with Liquidation, winding up and is not affiliated withdissolution of the Company and Aralez, and (ii) holds or will hold the QLT Shares, the QLT Class A Common Shares (as defined below)(the "Dissolution") and the Aralez Shares as capital property (referred to in this portiondistribution of the summary as a "holder"). Generally, the QLT Shares, the QLT Class A Common Shares and Aralez Shares will constitute capital property to a holder provided the holder does not hold those securitiesany amounts in the course of carrying on a business or as part of an adventure or concernthe winding up in accordance with the nature of trade.Liquidation Plan.

            For greater certainty, this summary also does not apply to holders of stock options, warrants, RSUs or DSUs.

            This summary is based on the current provisions of the Tax Act and the regulations thereunder, (the "Regulations"), and on the Company'san understanding of the current administrative policies and practices of the CRA published in writing prior to the date hereof (the "Tax Practices"). This summary takes into accountand all specific proposals to amend the Tax Act or Regulations that have been publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof (the "("Tax Proposals"Proposals") and assumes that all Tax Proposals will. There can be enacted in the form proposed. However, no assurance can be given that the Tax Proposals will be enactedimplemented in thetheir current form proposed, or at all. This summary except for the Tax Proposals, does not otherwise take into account or anticipate any changes in income tax law or Tax Practices,administrative practice, whether by judicial, governmental or legislative regulatory, administrativedecision or judicial means. This summaryaction, nor does notit take into account Canadian provincial, territorial or foreign tax considerations, which may differ significantly from those set outdiscussed herein.

    This summary is not exhaustive of all Canadian federal income tax considerations.

            This summary is not applicable to a person (i) that is a "financial institution" for purposes of the mark-to-market rules in the Tax Act, (ii) an interest in which is a "tax shelter investment", (iii) that reports its "Canadian tax results" in a currency other than Canadian currency, or (iv) that has entered into or will enter into a "derivative forward agreement" in respect of the common shares of the Company, each as defined in the Tax Act. Such persons should consult their own tax advisors having regard to their particular circumstances. In addition, this summary assumes that any distributions made pursuant to the Liquidation Plan are considered to occur on the Liquidation or discontinuance of the Company's business for the purposes of the Tax Act. This summary does not address the Canadian federal income tax considerations applicable to the holdings by a shareholder of the Amryt Equity, which may be distributed in kind. Shareholders should consult their own tax advisors in this regard.

            This summary is of a general nature only and is not intended to be, nor should it be construedconsidered to be, tax or legal business or tax advice to any particular holder. Accordingly, holders should consult their own tax advisors having regardshareholder and no representation is made with respect to their particular circumstances.


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            For the purposes of the Act, subject to certain exceptions where an amount that is relevant in computing a taxpayer's "Canadian tax results" is expressed in a currency other than Canadian dollars, the amount must be converted to Canadian dollars using the noon exchange rate quoted by the Bank of Canada for the day on which the amount arose. For greater certainty this summary may not apply to a taxpayer that has made an election to compute its "Canadian tax results" in a currency other than Canadian currency.

    A.    QLT Shareholders Resident in Canada

            This portion of the summary is generally applicable to a holder who, at all relevant times, for purposes of the Act and any applicable income tax convention is, or is deemedconsequences to be, resident in Canada (referred to in this portion of the summary as a "resident holder"). Certain resident holders may be entitled to make, or may have already made, the irrevocable election permitted by subsection 39(4) of the Act to deem to be capital property any QLT Shares, QLT Class A Common Shares and Aralez Shares (and all other "Canadian securities", as defined in the Act) owned by such resident holder in the taxation year in which the election is made and in all subsequent taxation years. Resident holdersparticular shareholder. Accordingly, shareholders should consult their own tax advisors concerning this election.the application and effect of the income and other taxes of Canada and of any other relevant country, province, territory, state or local tax authority, having regard to their particular circumstances.

    Residents of Canada

            ThisThe following portion of the summary does not applyis applicable to a QLT shareholder: (i) with respect to whom Aralez is or will be a "foreign affiliate" within the meaning of the Act, (ii) that is a "financial institution"shareholders who, at all relevant times and for the purposes of the mark-to-market rules in theTax Act, (iii) an interest in which is a "tax shelter investment" as defined in the Act, (iv) that is a "specified financial institution" as defined in the Act, (v) that reports its "Canadian tax results" in a currency other than Canadian currency, (vi) that enters into, with respectare resident or deemed to its QLT Shares, the QLT Class A Common Shares or Aralez Shares, a "derivative forward agreement", as defined in the Act. Such resident holders should consult their own tax advisors with respect to the Special Distribution.

            Additional considerations, not discussed herein, may be applicable to a resident holder that is a corporation resident in Canada, hold their common shares as "capital property" and is, or becomes, as part of a transaction or event or series of transactions or events that includesdeal at arm's length with and are not "affiliated" with the Arrangement, controlled by a non-resident corporation for purposes of the "foreign affiliate dumping" rules in the Act. Such resident holders should consult their tax advisors with respect to the consequences of the transactions discussed herein.Company ("Resident Shareholders").

    1.     Tax Consequences for Resident Holders of a Reorganization of Share Capital

    (i)    General

            If the aggregate fair market value of the Aralez Shares (or cash in lieu thereof) received by a resident holder on the exchange of existing QLT Shares under the Reorganization of Share Capital for new        Generally, common shares of the Company (the "QLT Class A Common Shares",will be considered to be capital property to a Resident Shareholder provided that the Resident Shareholder does not hold the common shares in the course of carrying on a business or has not acquired them in one or more transactions considered to be an adventure or concern in the nature of trade. Certain Resident Shareholders whose common shares might not otherwise qualify as capital property may, in certain circumstances, make an irrevocable election in accordance with subsection 39(4) of the Tax Act to have the common shares, and every "Canadian security" as defined in the Arrangement), andTax Act owned by such Resident Shareholder in the Aralez Shares (or cash in lieu thereof) exceeds the paid-up capitaltaxation year of the existing QLT Shares so exchanged, then the excess will beelection and in all subsequent taxation years, deemed to be capital property.

    Distributions to Resident Shareholders

            Where a dividend received bydistribution under the resident holder fromLiquidation Plan and in the Company. See "(ii) QLT Class A Common Shares" below for a general descriptioncourse of the treatment of dividends under the Act including amounts deemed under the Act to be received as dividends. The CompanyDissolution is effected through a reduction of the view that the fair market valuecapital in respect of the Aralez Shares (and any cash in lieu thereof) received by a resident holder will be less than the paid-up capital of the exchanged QLT Shares immediately before such exchange. Accordingly, the Company does not expect that a deemed dividend should arise as a result of the Reorganization of Share Capital.

            On the exchange of QLT Sharescommon shares of the Company, for QLT Class A Common Shares and Aralez Shares (or cash in lieu thereof), a capital gain (or capital loss) may alsoResident Shareholder will be realized byconsidered to have received a resident holder equaldividend only to the amount by which: (a)extent (if any) that the aggregate of any amounts received on such distribution exceeds the cost"paid-up capital" (as defined in the Tax Act) at that time of the Aralez Shares (or cash in lieu thereof), determined as described below, less the amount of any dividend deemed to be received by such resident holder on the exchange (which is expected to be nil), exceeds (or is less than); (b) the aggregate of the adjusted cost base to such resident holder of the existing QLT Shares exchanged and any reasonable costs of disposition. See "(iv) Taxation of Capital Gains and Capital Losses" below for a general description of the treatment of capital gains and capital losses under the Act.Resident


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    (ii)   QLT Class A Common Shares

    Shareholder's common shares. The costCompany reasonably expects that its paid-up capital will be greater than the anticipated aggregate amount of the distributions, with the result that no portion of the distributions expected to be paid to the Resident Shareholders on the reduction of capital and in the course of the liquidation, winding up and dissolution of the Company should be classified as a taxable dividend. Provided that this expectation is correct, no deemed taxable dividend should arise as a consequence of any distribution. However, the CRA could take a different view as to the calculation of the paid-up capital of the common shares, which could result in materially different tax consequences to the Resident Shareholders. Any portion of a distribution that is paid by the Company as a dividend would be taxable to a resident holderResident Shareholder, as generally described below under the heading "— Taxation of Dividends".

            Any portion of a distribution received on a reduction of the QLT Class A Common Shares acquired onpaid-up capital in respect of the exchangeResident Shareholder's common shares will be equaldeducted from the Resident Shareholder's adjusted cost base of its common shares. To the extent that the amount received on such reduction of paid-up capital exceeds the adjusted cost base to the amount, if any, by whichResident Shareholder of the common shares, the adjusted cost base of the resident holder's QLT Shares immediately beforecommon shares to the exchange exceedsResident Shareholder will be reduced to nil and the fair market valueexcess of such paid-up capital reduction over the resulting reduction in adjusted cost base will be deemed to be a capital gain of the AralezResident Shareholder for the year from the disposition of the common shares. The tax consequences to a Resident Shareholder of any such capital gain are generally as described below under the heading "— Taxation of Capital Gains and Losses" beginning on page 44 of this Proxy Statement.

    Cancellation of the Common Shares (or cash in lieu thereof) received on the exchange.

            For purposes of determining the adjusted cost base toTax Act a resident holder of QLT Class A Common Shares so acquired, the cost of the QLT Class A Common SharesResident Shareholder will generally be averaged withconsidered to have disposed of the common shares when all of the legal requirements for dissolution have been satisfied and the final distribution of the Company's assets has been made.

            A Resident Shareholder may realize a capital loss on cancellation of the Resident Shareholder's common shares on the final dissolution of the Company equal to the positive amount, if any, of the adjusted cost base of any other QLT Class A Common Shares held by the resident holder as capital property atResident Shareholder's common shares determined immediately before that time. The tax consequences to a Resident Shareholder of such capital losses are generally as described below under the heading "— Taxation of Capital Gains and Losses" beginning on page 44 of this Proxy Statement.

    Taxation of Dividends

            A resident holderResident Shareholder will be required to include in computing income such holder's income for a taxation year the amount of any dividends received or deemed to be received on the QLT Class A Common Shares.common shares.

            In the case ofAny dividend that is, or is deemed to be, received by a resident holderResident Shareholder who is an individual dividends received or deemed to be received on the QLT Class A Common Shares will be subject to the gross-upgross up and dividend tax credit rules normally applicable to taxable dividends received by Canadian resident individuals from a taxable Canadian corporations,corporation, including the enhanced gross up and dividend tax credit rules applicable to dividends validly designated byif the dividend recipient receives notice from the Company designating the dividend as an "eligible dividends" for the purposes of the Act. There are limits on the ability of a corporation to designate dividends as "eligible dividends" for the purposes of the Act.dividend".

            In the case ofAny dividend that is, or is deemed to be, received by a resident holderResident Shareholder that is a corporation dividends received or deemed towill be received onincluded in computing the QLT Class A Common SharesResident Shareholder's income as a dividend, and will subject to the following, generallyordinarily be deductible in computing its taxable income to the extent and under theincome. In certain circumstances, provided in the Act. In particular, subsection 55(2) of the Tax Act (as proposed to be amended by Tax Proposals) maywill treat a taxable dividend received by a resident holderResident Shareholder that is a corporation asto be proceeds of a disposition or as a capital gain. Resident holdersShareholders that are corporations should consult their own tax advisors having regard to their own circumstances.

            A resident holderResident Shareholder that is a "private corporation" or "subject corporation" (as such terms are, as defined in the Act) mayTax Act, or any other corporation resident in Canada controlled, whether because of a beneficial interest in one or more trusts or otherwise, by or for the benefit of an individual (other than a trust) or a related group of individuals (other than trusts), will generally be liable to pay tax under Part IV of the Tax Act to pay a(which may be refundable tax of 331/3% ofin certain circumstances) on dividends received or deemed to be received on the QLT Class A Common Shares to the extent such dividends are deductible in computing the resident holder'sResident Shareholder's taxable income.income for the taxation year.


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    Taxation of Capital Gains and Losses

            DividendsGenerally, on a disposition or deemed to be received by a resident holder who is an individual or trust other than certain specified trusts, may give rise to alternative minimum tax under the Act.

            Generally, a resident holder that disposes of or is deemed to have disposeddisposition of a QLT Class A Common Share (except to the Company)common share, a Resident Shareholder will realize a capital gain (or capital loss) equal to the amount, if any, by which the proceeds of disposition, net of any reasonable costs of disposition, exceed (or are less than) the adjusted cost base to the resident holderResident Shareholder of the QLT Class A Common Sharescommon share immediately before the disposition or deemed disposition. See "(iv) Taxation of Capital Gains and Capital Losses" below for

            Generally, a general description of the treatment of capital gains and capital losses under the Act.

    (iii)  Aralez Shares

            A resident holder will be considered to have acquired the Aralez Shares at a cost equal to their fair market value at the time of the exchange. For purposes of determining the adjusted cost base to a resident holder of Aralez Shares so acquired, the cost of the Aralez Shares will generally be averaged with the adjusted cost base of any other Aralez Shares held by the resident holder as capital property at that time.

            A resident holderResident Shareholder will be required to include in computing such holder'sits income for a taxation year the amount of dividends received or deemed to be received on the, Aralez Shares. In the case of a resident holder who is an individual, dividends received or deemed to be received on the Aralez Shares will be subject to the gross-up and dividend tax credit rules normally applicable to taxable dividends received from taxable Canadian corporations, including the dividend tax credit rules applicable to dividends validly designated by Aralez as "eligible dividends" for the purposes of the Act. There are limits on the ability of a corporation to designate dividends as "eligible dividends" for the purposes of the Act.

            In the case of a resident holder that is a corporation, dividends received or deemed to be received on the Aralez Shares will, subject to the following, generally be deductible in computing its taxable income to the extent and under the circumstances provided in the Act. In particular, subsection 55(2) of the Act (as proposed to be amended by Tax Proposals) may treat a taxable dividend received by a resident holder that is a corporation as


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    proceeds of a disposition or as a capital gain. Resident holders that are corporations should consult their own tax advisors having regard to their own circumstances.

            A resident holder that is a "private corporation" or "subject corporation" (as such terms are defined in the Act) may be liable under Part IV of the Act to pay a refundable tax of 331/3% of dividends received or deemed to be received on the Aralez Shares to the extent such dividends are deductible in computing the resident holder's taxable income.

            Dividends deemed to be received by a resident holder who is an individual or trust other than certain specified trusts, may give rise to alternative minimum tax under the Act.

            Generally a resident holder that disposes of or is deemed to have disposed of Aralez Shares will realize a capital gain (or capital loss) equal to the amount, if any by which the proceeds of disposition, net of any reasonable costs of disposition, exceed (or are less than) the adjusted cost base to the resident holder of the Aralez Shares immediately before the disposition or deemed disposition. See "(v)Taxation of Capital Gains and Capital Losses" below for a general description of the treatment of capital gains and capital losses under the Act.

    (iv)  Taxation of Capital Gains and Capital Losses

            Generally, one half of the amount of any capital gain (a "taxable"taxable capital gain"gain") realized by a resident holder in a taxation year must be included in the resident holder's incomeit in that year and, subjectyear. A Resident Shareholder will generally be entitled to and in accordance with the provisions of the Act,deduct one half of the amount of any capital loss (an "allowable"allowable capital loss"loss") realized by a resident holder in a taxation year must be deducted from taxable capital gains realized by the resident holderResident Shareholder in that year. Allowable capital losses inyear, and any excess of taxable capital gains in any particular year may be carried back and deducted into any of the three preceding taxation years or carried forward and deducted into any subsequent taxation year and deducted against net taxable capital gains realized in such years, to the extent and under the circumstances describedspecified in the Tax Act.

            The amount of anya capital loss realized on the disposition or deemed disposition of a QLT Sharecommon share by a resident holderResident Shareholder that is a corporation may, to the extent and under the circumstances specified in certain circumstances,the Tax Act, be reduced by the amount of dividends on the common shares received or deemed to have beenbe received by it on such QLT Shares,the Resident Shareholder, to the extent and underin the circumstances prescribed byset out in the Tax Act. Similar rules may apply where common shares are owned by a partnership or trust of which a corporation, trust or partnership is a member of a partnership or a beneficiary of a trust that owns common shares, directly or indirectly, through a partnership or trust.beneficiary. Resident holdersShareholders to whom these rules may be relevant should consult their own tax advisors.advisors in this regard.

            A Resident Shareholder that is a "Canadian controlled private company" (as defined in the Tax Act) may be liable to pay an additional refundable tax on its "aggregate investment income" for the year, which is defined to include an amount in respect of taxable capital gains.

    Alternative Minimum Tax

            A capital gain realized, or a dividend received (or deemed to be received) by a Resident Shareholder that is an individual, orincluding a trust (other than certain specified trusts), may give rise to a liability for alternative minimum tax.tax as calculated under the detailed rules set out in the Tax Act. Such Resident Shareholders should consult their own tax advisors with respect to the alternative minimum tax rules set out in the Tax Act.

    Non-Residents of Canada

            The following portion of the summary is applicable to shareholders of the Company who, at all relevant times and for purposes of the Tax Act, are not resident or deemed to be resident in Canada and do not use or hold, and are not deemed to use or hold, their common shares in connection with carrying on a business in Canada ("Non-Resident Shareholders"). Special rules not discussed in this summary may apply to an insurer carrying on an insurance business in Canada, and any such insurers should consult their own tax advisors.

    Distributions

            The consequences to Non-Resident Shareholders of any distribution under the Tax Act will be as described above under the heading "— Residents of Canada — Distributions to Resident Shareholders" beginning on page 42 of this Proxy Statement.

    A resident holderdistribution under the Liquidation Plan that is effected as a "Canadian-controlled private corporation"return of capital on the common shares held by a Non-Resident Shareholder will not be subject to Canadian withholding tax, unless the amount received on such distributions exceeds the "paid-up capital" (as defined in the Tax Act) may be liable for an additional refundable tax on investment income. For this purpose, investment income will generally include taxable capital gains.

    2.     Tax Consequences of a Dividend-in-Kind

            The paymentat that time in respect of the Special DistributionNon-Resident Shareholder's common shares. In such case, any such excess amount will be deemed to be a dividend and would be subject to taxation as described below under the heading "— Taxation of Dividends" beginning on page 45 of this Proxy Statement.

            The Company reasonably anticipates that its paid-up capital will be greater than the anticipated aggregate amount of the distributions with the result that no amount of the distributions to be paid to the Non-Resident Shareholders on the reduction of capital and in the course of the liquidation, winding up and dissolution of the Company should be classified as a dividend-in-kind will betaxable dividend. However, the CRA could take a taxable dividenddifferent view as to resident holders. The amount of that dividend will be equal to the fair market value of the Aralez Shares (or cash in lieu thereof) at the time of the payment. The taxation of dividends is discussed above under "1.Tax Consequences for Resident Holders of a Reorganization of Share Capital — (ii) QLT Class A Common Shares".

            See"(iii) Aralez Shares" above under "1.Tax Consequences for Resident Holders of a Reorganization of Share Capital" for a general discussion of the tax consequences of holding such securities to resident holders.

    3.     Eligibility for Investment (Resident Holders)

            Provided that the QLT Class A Common Shares are listed on a designated stock exchange (which currently includes the TSX and NASDAQ), the QLT Class A Common Shares will be a qualified investment under the Act for a trust governed by a "registered retirement savings plan", "registered retirement income fund", "tax-free savings account", "registered education savings plan", "deferred profit sharing plan", "registered disability savings plan" (each, a "Registered Plan").


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            Provided that the Aralez Shares are listed on a designated stock exchange, the Aralez Shares will be qualified investments under the Act for Registered Plans.

            Notwithstanding that a QLT Class A Common Share or Aralez Share may be a qualified investment for a Registered Plan, if the QLT Class A Common Share or Aralez Share is a "prohibited investment" within the meaningcalculation of the Act for a Registered Plan, the holder or annuitant of the Registered Plan, as the case may be, will be subject to adverse tax consequences as set out in the Act. A QLT Class A Common Share or Aralez Share will generally not be a "prohibited investment" for a Registered Plan if the holder or annuitant, as the case may be, does not have a "significant interest" (as defined for this purpose in the Act) in the Company or Aralez.

    B.    QLT Shareholders Not Resident in Canada

            This portion of the summary is applicable to a QLT shareholder who, at all relevant times and for the purposes of the Act (i) is not and is not deemed to be resident in Canada, (ii) who does not use or hold and will not be, deemed to use or hold the QLT Shares, the QLT Class A Common Shares and the Aralez Shares in carrying on a business in Canada, and (iii) is neither a "specified shareholder" (as defined in subsection 18(5) of the Act) of the Company nor a person who does not deal at arm's length with such specified shareholder (a "non-resident holder"). This summary does not apply to a non-resident that is an insurer carrying on business in Canada.

    1.     Tax Consequences to Non-Resident Holders of a Reorganization of Share Capital

    (i)    General

            If the aggregate fair market value of the Aralez Shares (or cash in lieu thereof) received by a non-resident holder on the Reorganization of Share Capital exceeds the paid-up capital attributable to the QLT Shares exchanged by such non-resident holder, then the excess will be deemed to be a dividend received by the non-resident holder. See "2.Tax Consequences to Non-Resident Holders of a Dividend-in-Kind" below for a general description of the treatment under the Act of dividends received by non-resident holders, including amounts deemed under the Act to be received as dividends. As noted above, the Company is of the view that the fair market value of the Aralez Shares (or cash in lieu thereof) received by a non-resident holder will be less than the paid-up capital of the exchanged QLT Shares immediately before such exchange. Accordingly, the Company does not expect that a deemed dividend will arise as acommon shares, which could result of the exchange.

            On the exchange of QLT Shares for QLT Class A Common Shares and Aralez Shares (or cash in lieu thereof), a capital gain (or capital loss) may also be realized by a non-resident holder equalmaterially different tax consequences to the amount by which: (a) the fair market value of the Aralez Shares (or cash in lieu thereof) received by the non-resident holder, less the amount of any dividend deemed to be received by the non-resident holder on the exchange (which is expected to be nil), exceeds (or is less than); (b) the aggregate of the adjusted cost base to the non-resident holder immediately before the exchange of the QLT Shares exchanged and any reasonable costs of disposition. See "Non-Resident Shareholders.

    (iv) Taxation of Capital Gains and Capital Losses" below for a general description of the treatment of capital gains and capital losses under the Act.

    (ii)   QLT Class A Common SharesDividends

            Under the Act, dividends paid        Any dividend that is, or credited on the QLT Class A Common Shares, oris deemed to be, paid or credited on QLT Class A Common Shares,by the Company to a non-resident holderNon-Resident Shareholder will be subject to Canadian withholding tax at a rate of 25% or such lower rate as may be provided under the terms of an applicable Canadian income tax treaty. Under the Canada-United States Income Tax Convention the rate of 25%withholding tax on dividends paid or credited to a Non-Resident Shareholder that is fully entitled to the benefits of such treaty is generally reduced to 15% of the gross amount of the dividends, subject to any reduction in the rate of withholding to which the non-resident holder is entitled under any applicable income tax treaty or convention between Canada and the country in which the Non-Resident Holder is resident. For example, where a non-resident holder is a resident of the United States, is fully entitled to the benefits under theCanada-United States Income Tax Convention (1980), as amended, and is the beneficial owner of the dividend, the applicable rate of Canadian withholding tax generally may be reduced to 15% of the amount of such dividend.

            A non-resident holder will not be subject to tax under the Act on any capital gain realized on any disposition or deemed disposition of QLT Class A Common Shares unless such shares constitute "taxable


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    Canadian property" (as defined by the Act) to the non-resident holder at the time of the disposition and the non-resident holder is not entitled to relief under an applicable income tax treaty or convention.dividends.

            See "(iv) Taxation of Capital Gains and Capital Losses" below for a general description of the treatment of capital gains and capital losses under the Act.

    (iii)  Aralez Shares

            Under the Act, dividends paid or credited on the Aralez Shares, or deemed to be paid or credited on the Aralez Shares, to a non-resident holder will be subject to Canadian withholding tax at the rate of 25% of the gross amount of the dividends, subject to any reduction in the rate of withholding to which the non-resident holder is entitled under any applicable income tax treaty or convention between Canada and the country in which the Non-Resident Holder is resident. For example, where a non-resident holder is a resident of the United States, is fully entitled to the benefits under theCanada-United States Income Tax Convention (1980), as amended, and is the beneficial owner of the dividend, the applicable rate of Canadian withholding tax generally may be reduced to 15% of the amount of such dividend.

            A non-resident holder will not be subject to tax under the Act on any capital gain realized on any disposition or deemed disposition of Aralez Shares unless such shares constitute "taxable Canadian property" (as defined by the Act) to the non-resident holder at the time of the disposition and the non-resident holder is not entitled to relief under an applicable income tax treaty or convention.

            See "(iv) Taxation of Capital Gains and Capital Losses" below for a general description of the treatment of capital gains and capital losses under the Act.

    (iv)  Taxation of Capital Gains and Losses

            A non-resident holder will not be subject to tax under the Act on any capital gain realized on any disposition or deemed disposition of QLT Shares, QLT Class A Common Shares or Aralez Shares unless such shares constitute "taxable Canadian property" (as defined by the Act) to the non-resident holder at the time of the disposition and the non-resident holder is not entitled to relief under an applicable income tax treaty or convention.

            Generally, QLT Shares, QLT Class A Common Shares or Aralez Shares will not constitute taxable Canadian property to a non-resident holder at a particular time provided that such QLT Shares, QLT Class A Common Shares or Aralez Shares, as the case may be, are listed at that time on a designated stock exchange (which currently includes the TSX and NASDAQ), unless at any particular time during the 60-month period that ends at that particular time (1) the non-resident holder, persons with whom the non-resident holder does not deal at arm's length (for the purposes of the Act) and partnerships in which the non-resident holder or a person with whom the non-resident holder does not deal at arm's length holds a membership interest directly or indirectly through one or more partnerships, or the non-resident holder together with all such persons or partnerships, has owned 25% or more of the issued shares of any class or series of QLT or Aralez, as the case may be, and (2) more than 50% of the fair market value of the QLT Shares, QLT Class A Common Shares or Aralez Share, as the case may be, was derived directly or indirectly from one or any combination of: (i) real or immovable properties situated in Canada, (ii) "Canadian resource properties" (as defined in the Act), (iii) "timber resource properties" (as defined in the Act), and (iv) options in respect of, or interests in, or for civil law rights in, property in any of the foregoing whether or not the property exists. Notwithstanding the foregoing, in certain circumstances set out in the Act, QLT Shares, QLT Class A Common Shares or Aralez Shares could be deemed to be taxable Canadian property.

    2.     Tax Consequences of a Dividend-in-Kind

            A non-resident holder who receives the Special Distribution as a dividend-in-kind will be considered to have received a dividend from the Company equal to the fair market value of the Aralez Shares (or cash in lieu thereof), on the date of distribution. The taxation of dividends is discussed above under "1.Tax Consequences to Non-Resident Holders of the Reorganization of Share Capital — (ii) QLT Class A Common Shares".


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            A portion of the Aralez Shares otherwise to be distributed to a non-resident holder may be sold on the non-resident holder's behalf or retained in order to fund the payment of any withholding tax for which the holder is liable.


    Certain Material U.S. Federal Income Tax Consequences

    U.S. TREASURY CIRCULAR 230 NOTICE

    TO ENSURE COMPLIANCE WITH U.S. TREASURY CIRCULAR 230, EACH HOLDER OF QLT SHARES IS HEREBY NOTIFIED THAT (I) ANY DISCUSSION OF U.S. FEDERAL TAX ISSUES IN THE MEETING MATERIALS IS NOT INTENDED OR WRITTEN TO BE RELIED UPON, AND CANNOT BE RELIED UPON, BY SUCH HOLDER FOR THE PURPOSE OF AVOIDING U.S. FEDERAL TAX PENALTIES THAT MAY BE IMPOSED ON SUCH HOLDER OR PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY TRANSACTION OR MATTER ADDRESSED IN THE MEETING MATERIALS, (II) SUCH DISCUSSION IS INCLUDED HEREIN TO SUPPORT THE MARKETING OR PROMOTION OF THE PROPOSED SPECIAL DISTRIBUTION ON THE TERMS DESCRIBED IN THE MEETING MATERIALS, AND (III) EACH HOLDER SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.

    General

            The following is a summary of certain material U.S. federal income tax consequences of the proposed Special Distribution and does not purport to be a complete discussion of all of the possible U.S. federal income tax consequences of the matters addressed in this summary. This summary is included for general information only. It does not cover any state, local or non-U.S. income, U.S. federal estate or gift or other tax consequences. It does not address the tax consequences to shareholders that are subject to special tax rules, including, but not limited to, banks, life insurance companies, regulated investment companies, personal holding companies, non-U.S. persons, persons subject to alternative minimum tax, persons that do not use the U.S. dollar as their functional currency, persons who hold options of any kind with respect to any class of the Company's stock, shareholders of 10% or more of the voting shares of the Company, broker-dealers and tax-exempt organizations or persons holding the QLT Shares as part of a hedging, straddle, conversion or constructive sale transaction. This summary assumes that a U.S. holder (as defined below) holds the QLT Shares as capital assets.

            This summary is based on the provisions of the United States Internal Revenue Code of 1986, as amended (the "U.S. Code"), the regulations promulgated thereunder and rulings and judicial decisions interpreting the U.S. Code, each as of the date hereof. These authorities are subject to change at any time, possibly with retroactive effect. No assurances can be given that any changes in these laws or authorities will not affect the accuracy of the discussions set forth in this summary. We have not and will not request a ruling from the U.S. Internal Revenue Service (the "IRS") as to the U.S. federal income tax consequences of the proposed Special Distribution.

            As used herein, a "U.S. holder" means the beneficial owner of the QLT Shares that is, for U.S. federal income tax purposes, (i) a citizen or individual resident of the United States, (ii) a corporation, or an entity treated as a corporation for U.S. federal income tax purposes, created or organized under the laws of the United States or its political subdivisions, (iii) an estate the income of which is subject to U.S. federal income tax without regard to its source or (iv) a trust (a) subject to the primary supervision of a U.S. court and the control of one or more U.S. persons or (b) that has elected to be treated as a domestic trust for U.S. federal income tax purposes. The U.S. federal income tax treatment of a partner in a partnership that holds QLT Shares will depend on the status of the partner and the activities of the partnership.

    Special Distribution Pursuant to the Arrangement

            Whether the Special Distribution occurs pursuant to the Arrangement (or simply pursuant to a declaration of a dividend), it should be governed by the distribution rules of the U.S. Code. Subject to possible different treatment pursuant to the PFIC rules mentioned below, to the extent that the Company has current or accumulated undistributed earnings and profits, the amount of cash and the fair market value of the Aralez Shares (if any) received by a U.S. holder should be considered a dividend. Any amount distributed in excess of


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    the earning and profits of the Company should be treated as a return of capital distribution to the extent of and in reduction of a U.S. holder's basis in its shares, and any remaining amount should be taxed as capital gain. The Company believes it has no positive current or accumulated earnings and profits at present. However, because the determination of current earnings and profits is not determinable until the close of the year in which the Special Distribution occurs, and because it is possible that current earnings and profits may result from the distribution of Aralez Shares or otherwise, there can be no assurance that the Company will have no positive current or accumulated earnings and profits. Further, the determination of earnings and profits may be subject to IRS review and audit.

            As discussed below, the Company believes that it may be deemed a Passive Foreign Investment Company ("PFIC") for certain prior years and that it may be classified as a PFIC in 2015. In the event that the Company is considered to be a PFIC in the current or any previous year in which a U.S. holder was the owner of shares in the Company, and to the extent that the Special Distribution constitutes an "excess distribution," as described below, U.S. holders may be subject to an interest charge on any "deferred tax amounts" under the PFIC regime.

    Arrangement

            The exchange of shares pursuant to the Arrangement should be considered a recapitalization of the shares of the Company for U.S. federal income tax purpose. A U.S. holder's tax basis and holding period in the shares of the Company received or deemed received pursuant to the Arrangement should be the same as such U.S. holder's tax basis and holding period in the shares of the Company exchanged or deemed exchanged therefor (in each case, preserving the separate tax bases and holding periods of separate blocks, if any, held by such U.S. holder).

            Under applicable regulations, the Special Distribution should be treated as a distribution separate from the recapitalization and, as described above, governed by the distribution rules of the U.S. Code.

    Passive Foreign Investment Company Provisions

            The U.S. Code provides special rules regarding certain distributions received by U.S. persons with respect to, and sales, exchanges and other dispositions, including pledges, of, shares of stock in a PFIC. The Company believes, but cannot offer any assurance, that it was classified as a PFIC for one or more taxable years prior to 2000, and that it was not a PFIC during any of the taxable years from the taxable year ended December 31, 2000 through the taxable year ended December 31, 2007. The Company further believes that it was a PFIC for the taxable years ended December 31, 2008 through 2014. The Company is uncertain regarding its potential PFIC status for the taxable year ending December 31, 2015. The Company's actual PFIC status for a given taxable year will not be determinable until the close of such year and, accordingly, no assurances can be given regarding the Company's PFIC status in 2015 or any future year. See further discussion of the PFIC rules below.

            A U.S. holder that holds stock in a foreign corporation during any taxable year in which the corporation qualifies as a PFIC is subject to special tax rules with respect to (a) any gain realized on the sale, exchange or other disposition of the stock and (b) any "excess distribution" by the corporation to the holder, unless the holder elects to treat the PFIC as a "qualified electing fund" ("QEF") or makes a "mark-to-market" election, each as discussed below. An "excess distribution" is that portion of a distribution with respect to PFIC stock that exceeds 125% of the average of such distributions over the preceding three-year period or, if shorter, the U.S. holder's holding period for its shares.

            In the event that the Company is considered to be a PFIC in the current or any previous year in which a U.S. holder was the owner of shares in the Company, the Special Distribution may constitute an "excess distribution." In such case, as in the case of gain realized on a disposition of the shares, the Special Distribution must be allocated ratably to each day in the U.S. holder's holding period of shares in the Company. The amounts allocated to the current taxable year and to taxable years prior to the first year in which the Company was classified as a PFIC are included as ordinary income in a U.S. holder's gross income for that year. The amount allocated to each other prior taxable year is taxed as ordinary income at the highest tax rate in effect for the U.S. holder in that prior year (without offset by any net operating loss for such year) and are subject to an interest charge at the rate on income tax deficiencies.


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            In addition, a U.S. holder who acquires shares in a PFIC from a decedent generally will not receive a "stepped-up" fair market value tax basis in such shares but, instead, will receive a tax basis equal to the decedent's basis, if lower.

            If a corporation is a PFIC for any taxable year during which a U.S. holder holds shares in the corporation, then the corporation generally will continue to be treated as a PFIC with respect to the holder's shares, even if the corporation no longer satisfies either the passive income or passive asset tests that determine PFIC status, unless the U.S. holder terminates this deemed PFIC status by electing to recognize gain, which will be taxed under the excess distribution rules as if such shares had been sold on the last day of the last taxable year for which the corporation was a PFIC.

            The adverse tax consequences described above will not apply, however, if a U.S. holder makes a QEF election effective beginning with the first taxable year in the U.S. holder's holding period in which the corporation is a PFIC. A U.S. holder that makes a QEF election is required to include in income its pro rata share of the PFIC's ordinary earnings and net capital gain as ordinary income and long-term capital gain, respectively, subject to a separate election to defer payment of taxes, which deferral is subject to an interest charge. A U.S. holder whose QEF election is effective after the first taxable year during the holder's holding period in which the corporation is a PFIC will continue to be subject to the excess distribution rules for years beginning with such first taxable year for which the QEF election is effective. In a chain of ownership, only the first U.S. person that is a shareholder of the PFIC may make the QEF election.

            In general, a U.S. holder makes a QEF election by attaching a completed IRS Form 8621 to a timely filed (taking into account any extensions) U.S. federal income tax return for the year beginning with which the QEF election is to be effective. In certain circumstances, a U.S. holder may be able to make a retroactive QEF election. A QEF election can be revoked only with the consent of the IRS. In order for a U.S. holder to make a valid QEF election, the corporation must annually provide or make available to the holder certain information.

            As an alternative to making a QEF election, a U.S. holder may make a "mark-to-market" election with respect to its PFIC shares if the shares meet certain minimum trading requirements. If a U.S. holder makes a valid mark-to-market election for the first tax year in which such holder holds (or is deemed to hold) stock in a corporation and for which such corporation is determined to be a PFIC, such holder generally will not be subject to the PFIC rules described above in respect of its stock. Instead, a U.S. holder that makes a mark-to-market election will be required to include in income each year an amount equal to the excess of the fair market value of the shares that the holder owns as of the close of the taxable year over the holder's adjusted tax basis in the shares. The U.S. holder will be entitled to a deduction for the excess, if any, of the holder's adjusted tax basis in the shares over the fair market value of the shares as of the close of the taxable year; provided, however, that the deduction will be limited to the extent of any net mark-to-market gains with respect to the shares included by the U.S. holder under the election for prior taxable years. The U.S. holder's basis in the shares will be adjusted to reflect the amounts included or deducted pursuant to the election. Amounts included in income pursuant to a mark-to-market election, as well as gain on the sale, exchange or other disposition of the shares, will be treated as ordinary income. The deductible portion of any mark-to-market loss, as well as loss on a sale, exchange or other disposition of shares to the extent that the amount of such loss does not exceed net mark-to-market gains previously included in income, will be treated as ordinary loss. The mark-to-market election applies to the taxable year for which the election is made and all subsequent taxable years, unless the shares cease to meet applicable trading requirements or the IRS consents to its revocation.

            A U.S. holder of PFIC stock must generally file an IRS Form 8621 annually. A U.S. holder must also provide such other information as may be required by the U.S. Treasury Department if the U.S. holder (i) receives certain direct or indirect distributions from a PFIC, (ii) recognizes gain on a direct or indirect disposition of PFIC stock, or (iii) makes certain elections (including a QEF election or a mark-to-market election) reportable on IRS Form 8621.

    THE APPLICABILITY AND CONSEQUENCES OF THE PFIC RULES ARE EXCEEDINGLY COMPLEX. IN ADDITION, THE FOREGOING SUMMARY DOES NOT ADDRESS ALL OF THE POTENTIAL U.S. FEDERAL INCOME TAX CONSEQUENCES WITH RESPECT TO PFIC STATUS THAT MAY BE RELEVANT TO A PARTICULAR U.S. HOLDER IN LIGHT OF SUCH INVESTOR'S PARTICULAR CIRCUMSTANCES OR THAT MAY BE RELEVANT TO U.S. HOLDERS THAT ARE SUBJECT TO SPECIAL


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    TREATMENT UNDER U.S. FEDERAL INCOME TAX LAW. ACCORDINGLY, U.S. HOLDERS ARE STRONGLY URGED TO CONSULT THEIR TAX ADVISORS REGARDING THE APPLICATION OF THE PFIC RULES TO THEM AND THE ADVISABILITY OF MAKING ANY OF THE ELECTIONS DESCRIBED ABOVE.

    Information Reporting and Backup Withholding in Respect of the QLT Shares

            In general, information reporting requirements will apply to distributions made on the Company's common shares within the United States to a non-corporate U.S. holder and to the proceeds from the sale, exchange, redemption or other disposition of the Company's common shares by a non-corporate U.S. holder to or through a U.S. office of a broker. Payments made (and sales or other dispositions effected at an office) outside the United States will be subject to information reporting in limited circumstances.

            In addition, backup withholding of U.S. federal income tax may apply to such amounts if the U.S. holder fails to provide an accurate taxpayer identification number (or otherwise establishes, in the manner provided by law, an exemption from backup withholding) or to report dividends required to be shown on the U.S. holder's U.S. federal income tax returns.

            Backup withholding is not an additional income tax, and the amount of any backup withholding from a payment to a U.S. holder will be allowed as credit against the U.S. holder's U.S. federal income tax liability provided that the appropriate returns are filed.

            A non-U.S. holder generally may eliminate the requirement for information reporting and backup withholding by providing certification of its foreign status to the payor, under penalties of perjury, on IRS Form W-8BEN or W-8BEN-E, as applicable. You should consult your own tax advisor as to the qualifications for exemption from backup withholding and the procedures for obtaining the exemption.

    Tax consequences to U.S. holders of Aralez Shares

      Taxation of Dividends

            Subject to the PFIC rules discussed below, the gross amount of cash distributions on Aralez Shares (including any withheld Canadian taxes) will be taxable as dividends to the extent paid out of Aralez's current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Such income (including any withheld Canadian taxes) will be includable in a U.S. holder's gross income as ordinary income on the day actually or constructively received by the holder. For U.S. corporate holders, such dividends generally will not be eligible for the dividends-received deduction, except for a portion of certain dividends received by a corporate U.S. holder that owns 10% of Aralez's Shares (measured by both vote and value).

            Distributions in excess of Aralez's current and accumulated earnings and profits, as determined for U.S. federal income tax purposes, will be treated as a non-taxable return of capital to the extent of the U.S. holder's basis in the Aralez Shares, and thereafter as capital gain.

            With respect to non-corporate U.S. holders, certain dividends received from a qualified foreign corporation may be subject to reduced rates of taxation ("qualified dividend income"). A qualified foreign corporation includes a foreign corporation that is eligible for the benefits of a comprehensive income tax treaty with the United States that the U.S. Treasury Department determines to be satisfactory for these purposes and which includes an exchange of information provision. The U.S. Treasury Department has determined that the Canadian-U.S. tax treaty meets these requirements. However, a foreign corporation is also treated as a qualified foreign corporation with respect to dividends paid by that corporation on shares that are readily tradable on an established securities market in the United States. U.S. Treasury Department guidance indicates that the Aralez Shares, which are expected to be listed on the NASDAQ and application has been made to list the Aralez Shares on the Toronto Stock Exchange, will be considered readily tradable on an established securities market in the United States, but there can be no assurance that the Aralez Shares will be considered readily tradable on an established securities market. Non-corporate holders that do not meet a minimum holding period requirement during which they are not protected from the risk of loss or that elect to treat the dividend income as "investment income" pursuant to section 163(d)(4) of the U.S. Code (dealing with the deduction for investment interest expense) will not be eligible for the reduced rates of taxation applicable to qualified dividend income


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    regardless of Aralez's status as a qualified foreign corporation. In addition, the rate reduction will not apply to dividends if the recipient of a dividend is obligated to make related payments with respect to positions in substantially similar or related property. This disallowance applies even if the minimum holding period has been met.

            Subject to certain limitations, any Canadian tax withheld on dividends paid with respect to Aralez Shares in accordance with the Canadian-U.S. tax treaty and paid over to Canada, will be eligible for credit or deduction against the U.S. holder's U.S. federal income tax liability, but special complex rules apply in determining the foreign tax credit limitation with respect to dividends that are subject to the preferential tax rates. U.S. holders are urged to consult their own tax advisors to determine eligibility. Subject to the discussion below regarding section 904(h) of the U.S. Code, dividends generally will be foreign source income and will, depending on the U.S. holder's circumstances, be either "passive" or "general" income for purposes of computing the foreign tax credit allowable to such holder.

            Under section 904(h) of the U.S. Code, dividends paid by a foreign corporation that is treated as 50% or more owned, by vote or value, by U.S. persons may be treated as U.S. source income (rather than foreign source income) for foreign tax credit purposes, to the extent the foreign corporation earns U.S. source income. In most circumstances, U.S. holders would be able to choose the benefits of section 904(h)(10) and elect to treat dividends that would otherwise be U.S. source dividends as foreign source dividends, but in such a case, the foreign tax credit limitations would be separately determined with respect to such "resourced" income. In general, therefore, the application of section 904(h) may adversely affect a U.S. holder's ability to use foreign tax credits. Since the Aralez Shares are expected to be listed on the NASDAQ and application has been made to list the Aralez Shares on the Toronto Stock Exchange, Aralez may be treated as 50% or more owned by U.S. persons for purposes of section 904(h). U.S. holders are strongly urged to consult their own tax advisors regarding the possible impact if section 904(h) should apply.

            Distributions of Aralez Shares to a U.S. holder with respect to Aralez Shares that are made as part of a pro rata distribution to all Aralez shareholders generally will not be subject to U.S. federal income tax.

      Taxation of Capital Gains

            SubjectA Non-Resident Shareholder will not be subject to tax under the Tax Act in respect of a capital gain realized on the disposition or deemed disposition of the common shares provided the common shares do not constitute "taxable Canadian property" for the purposes of the Tax Act. The common shares of the Company will not generally constitute taxable Canadian property to a Non-Resident Shareholder at the time of disposition or deemed disposition provided that at no time during the 60 month period prior to the PFIC rules discussed below,disposition more than 50% of the fair market value of such common shares was derived directly or indirectly from real or immovable property situated in Canada or "Canadian resource properties", "timber resources property" (such as defined in the Tax Act), and options in respect of, or interests in or civil law rights in such properties. The Company does not believe that, at any time in the 60 month period ending on the date hereof, more than 50% of the fair market value of the common shares was derived directly or indirectly from real or immovable property situated in Canada, "Canadian resource properties", "timber resources property" and options in respect of, or interests in or civil law rights in such properties.

            The common shares of the Company may also be deemed to constitute taxable Canadian property to a U.S. holderparticular Non-Resident Shareholder in certain circumstances under the Tax Act. In the event that sells or otherwise disposesthe common shares of Aralez Shares will recognizethe Company constitute taxable Canadian property to a particular Non-Resident Shareholder, any resulting capital gain may be exempt from tax under the Tax Act in accordance with any applicable income tax treaty. If the capital gains (or capital losses) are derived from the disposition or loss fordeemed disposition of "taxable Canadian property" by a Non-Resident Shareholder, the Non-Resident Shareholder may in certain circumstances be required to file a Canadian tax return reporting the disposition or deemed disposition.A Non-Resident Shareholder who believes that its common shares may constitute taxable Canadian property should consult with its own tax advisor as to the particular Canadian tax implications that may be applicable.


    Certain Material U.S. Federal Income Tax Considerations

            The following is a general summary of certain material U.S. federal income tax purposes equalconsiderations applicable to the difference betweenLiquidation Plan that are applicable to our shareholders that are U.S. holders (as defined below). This discussion is included for general information purposes only and does not constitute, and is not, a tax opinion or tax advice to any particular U.S. holder. This summary is based on the amount realizedprovisions of the Internal Revenue Code of 1986, as amended (the "Code"), the Treasury Regulations promulgated thereunder, judicial decisions, administrative rulings and such holder's tax basis in its Aralez Shares. Capital gainother legal authorities, all as of a non-corporate U.S. holder is generally taxed at preferential rates where the property is held for more than one year. The gain or lossdate hereof and all of which are subject to change, possibly with retroactive effect. No ruling from the Internal Revenue Service (the "IRS") and no opinion of counsel will generally be income or loss from sources withinrequested concerning the United States for foreign tax credit limitation purposes.

      PFIC Rules

            Aralez has indicated that it believes that Aralez Shares should not be treated as stock of a PFIC for U.S. federal income tax purposes, but this conclusion isconsequences of the Liquidation Plan. The tax consequences set forth in the following discussion are not binding on the IRS or the courts, and no assurance can be given that contrary positions will not be successfully asserted by the IRS or adopted by a factual determinationcourt.

    Each shareholder should consult his, her or its tax advisors to determine the U.S. federal income tax consequences to such shareholder as a result of the Liquidation Plan, and any U.S. federal non-income, state, local or non-U.S. tax consequences relevant to such shareholder as a result of the Liquidation Plan.

            The following discussion does not address all of the U.S. federal income tax consequences that is made annually and thusmay be relevant to our shareholders, including Company shareholders who, in light of their particular circumstances, may be subject to change. See above for a general discussion of the PFIC rules. Holders are urged to consult their tax advisors regarding the possible application of the PFIC rules.

            Notwithstanding any election made with regard to Aralez Shares, dividendsspecial rules, including, without limitation, shareholders that a U.S. holder receives from Aralez will not constitute qualified dividend income if Aralez is a PFIC either in the taxable year of the distribution or the preceding taxable year. Dividends that a U.S. holder receives that do not constitute qualified dividend income are not eligible for taxation at the preferential rates applicable to qualified dividend income. Instead, such holder must include the gross amount of any such dividend paid by Aralez out of its accumulated earnings and profits (as determined for United States federal income tax purposes) in such holder's gross income, and it will be subject to tax at rates applicable to ordinary income. A U.S. holder that owns Aralez Shares during any year that Aralez is a PFIC with respect to such holder may be required to file IRS Form 8621.

      Information with Respect to Foreign Financial Assets

            Owners of "specified foreignholders, mutual funds, retirement plans, financial assets" with an aggregate value in excess of $50,000 (and in some circumstances, a higher threshold) may be required to file an information report with respect to such assets withinstitutions, tax-exempt organizations, insurance companies, regulated


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    investment companies, real estate investment trusts, brokers or dealers in securities, traders who mark to market, shareholders who hold their shares as part of a straddle, hedge or conversion transaction, shareholders whose "functional currency" is not the U.S. dollar and shareholders that hold shares through a partnership or any entity treated as a partnership for U.S. federal income tax returns. Specified foreign financialpurposes. Furthermore, this discussion does not apply to shareholders of options or warrants or shareholders who acquired their shares by exercising options or warrants, nor does it apply to shareholders who received their shares in connection with the performance of services. This discussion assumes that shareholders hold their stock as capital assets within the meaning of Section 1221 of the Code. In addition, the discussion does not address the alternative minimum tax, the Medicare tax or any aspect of U.S. federal non-income, state, local or non-U.S. taxation that may include financial accounts maintained by foreign financial institutions, as well as the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities issued by non-United States persons, (ii) financial instruments and contracts held for investment that have non-United States issuers or counterparties, and (iii) interests in foreign entities. Holders are urgedbe applicable to consult their tax advisors regarding the applicationa particular shareholder.

            For purposes of this reporting requirement to their ownershipdiscussion, a U.S. holder is a beneficial owner of our common stock that is for U.S. federal income tax purposes:

      an individual who is a citizen or resident of the shares.

        United States;Backup Withholding and Information Reporting

              For

      a non-corporatecorporation (or other entity that is classified as a corporation for U.S. holder, information reporting requirements, on IRS Form 1099, generally will applyfederal income tax purposes) that is created or organized in or under the laws of the United States, any State thereof or the District of Columbia;

      an estate the income of which is subject to dividend paymentsU.S. federal income tax regardless of its source; or other taxable distributions made to such holder

      a trust (i) if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the paymentauthority to control all substantial decisions of proceedsthe trust, or (ii) that has a valid election in effect under applicable Treasury regulations to such holder from the sale of Aralez Shares effected atbe treated as a U.S. office of a broker. Additionally, backup withholding may apply to such payments to a non-corporateperson for U.S. holder that fails to provide an accurate taxpayer identification number, is notified by the IRS that such holder has failed to report all interest and dividends required to be shown on the holder's federal income tax returns,purposes.

    Federal Income Taxation of Liquidation Distributions Received by U.S. Holders

            Subject to the discussion below under "— Passive Foreign Investment Company Considerations," amounts received by U.S. holders pursuant to a distribution in complete liquidation will be treated as full payment in exchange for their shares of common stock. As a result of our Liquidation Plan, a U.S. holder generally will recognize gain or loss equal to the difference between (i) the amount of cash and the fair market value (at the time of distribution) of any other property distributed, less any liabilities assumed by the shareholder or to which the distributed property is subject, if applicable, and (ii) such U.S. holder's tax basis in certain circumstances, failshis, her or its shares of our common stock.

            Amounts received by U.S. holders pursuant to comply with applicable certification requirements.


    Principal Stepsthe Liquidation Plan will first be applied against and reduce a U.S. holder's tax basis in his, her or its shares of common stock. Gain will be recognized as a result of a liquidation distribution to the extent that the aggregate value of the Arrangement

            Under the Arrangement, each of the issued QLT common shares ("QLT Shares") will be exchanged for: (a) one common share of a newly created class of common shares (referred to as "QLT Class A Common Shares")distribution and (b) a pro rata portion of the Aralez Shares (or cash in lieu up to an aggregate amount of $15 million, subject to proration). While the terms of the QLT Class A Common Sharesany prior liquidation distributions received by a QLT shareholder underU.S. holder with respect to a share exceeds his, her or its tax basis for that share. If we make more than one liquidation distribution, each liquidation distribution will be allocated proportionately to each share of common stock owned by a U.S. holder. Any loss will generally be recognized only when the Arrangementfinal distribution from us has been received and then only if the aggregate value of all liquidation distributions with respect to a share is less than the U.S. holder's tax basis for that share. Gain or loss recognized by a U.S. holder will differ frombe capital gain or loss provided the current QLT Shares,shares are held as capital assets, and will be long-term capital gain or loss if the common stock has been held for more than one year.

            In the event of a distribution of property, the U.S. holder's tax basis in such differenceproperty immediately after the distribution will generally be the fair market value of such property at the time of distribution and the holding period in such property will begin on the day following such distribution.

            If a U.S. holder is required to satisfy any liability of ours not fully covered by our reserves, payments by U.S. holders in satisfaction of such liabilities would generally produce a capital loss in the year paid, which, in the hands of individual U.S. holders, could not be material. No new share certificates will be issued representing the QLT Class A Common Shares and they will be renamed "common shares".

            The principal features of the Arrangement may be summarized as follows (and are qualifiedcarried back to prior years to offset capital gains realized from liquidation distributions in its entirety by reference to the full text of the Plan of Arrangement attached to this Proxy Statement as Appendix "A"):those years.

      (a)
      QLT's authorized share structure, its Notice of Articles and Articles will be altered by:

      (i)
      creating the QLT Class A Common Shares; and

      (ii)
      creating and attaching to the QLT Class A Common Shares the special rights and restrictions set out in Exhibit I to the Plan of Arrangement, which will be contained in Part 26 of the Articles;

      (b)
      each of the issued QLT Shares will be and be deemed to be exchanged for the following:

      (i)
      one QLT Class A Common Share; and

      (ii)
      such number of Aralez Shares as is equal to the Aralez Share Exchange Ratio or, cash in lieu of such Aralez Shares, if the transactions contemplated by the Backstop Agreement are completed and such holder has so elected to receive cash in lieu of all or part of their entitlement to Aralez Shares, subject to proration;

      (c)
      all of the QLT Shares will be cancelled and will form part of the authorized but unissued share capital of QLT and no QLT Shares will remain outstanding;

      (d)
      QLT's authorized share structure, its Notice of Articles and Articles will be altered by:

      (i)
      reducing the authorized capital by eliminating the authorized and unissued QLT Shares;

      (ii)
      deleting the special rights and restrictions attached to the QLT Class A Common Shares and by deleting Part 26 of the Articles of QLT in its entirety; and

      (iii)
      altering the identifying name of all of the QLT Class A Common Shares to be common shares;

      (e)
      the existing QLT stock option plan will be cancelled and will have no further force or effect and a replacement option plan (which shall have the same terms and conditions as the existing QLT stock

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        option plan exceptPassive Foreign Investment Company Considerations

                The treatment of a U.S. holders holding our common stock could be materially different from that any references to QLT Shares indescribed above if we are or were treated as a "passive foreign investment company" within the meaning of Section 1297 of the Code (a "PFIC") for U.S. federal income tax purposes.

                A non-U.S. corporation, such planas our Company, will be deemed toa PFIC, if, in the case of any particular taxable year, either (i) 75% or more of its gross income for such year consists of certain types of "passive" income or (ii) 50% or more of the average quarterly fair market value of its assets during such year produce or are held for the production of passive income. For this purpose, cash is categorized as a passive asset and the company's unbooked intangibles associated with active business activities may generally be QLT Class A Common Shares)classified as active assets. Passive income generally includes, among other things, dividends, interest, rents, royalties, and gains from the disposition of passive assets. We will be deemed to be adopted by QLTtreated as owning a proportionate share of the assets and earning a proportionate share of the income of any other corporation in effect;

      (f)
      which we own, directly or indirectly, more than 25% (by value) of the existing QLT deferred share unit plan will be cancelledstock.

              Based on the price of our common stock and will have no further force or effectcomposition of our assets, we believe that we were a PFIC for our taxable years ending December 31, 2008 through December 31, 2015 and that we were not a replacement deferred share unit plan (which shall havePFIC for our taxable years ending December 31, 2016 through December 31, 2018. Additionally, the same termsdetermination of whether we are a PFIC is made annually and conditionsdepends on the particular facts and circumstances (such as the existing QLT deferred share unit plan except that any references to QLT Shares in such plan willvaluation of our assets, including goodwill and other intangible assets) and also may be deemed to be QLT Class A Common Shares) will be deemed to be adopted by QLT and in effect;

      (g)
      each outstanding QLT stock option will be exchangedaffected by the holder thereof, without any further act or formality, for a stock option (a "Replacement Option") onapplication of the same terms and conditions as the QLT stock option so exchanged except that such Replacement Option shall be exercisable to acquire a QLT Class A Common Share;

      (h)
      each outstanding QLT restricted stock unit will be exchanged by the holder thereof, without any further act or formality, for a restricted stock unit (a "Replacement Restricted Stock Unit") on the same terms and conditions as the QLT restricted stock unit so exchanged except that such Replacement Restricted Stock Unit will entitle the holders, upon vesting, to acquire a QLT Class A Common Share; and

      (i)
      each outstanding QLT deferred share unit will be exchanged by the holder thereof, without any further act or formality, for a deferred share unit (a "Replacement Deferred Share Unit") on the same terms and conditions as the QLT deferred share unit so exchanged except that the value of such Replacement Deferred Share Unit will be equal to a QLT Class A Common Share.


    Court Approval

            Statutory plans of arrangement under the BCBCAPFIC rules, which are subject to approval by the Supreme Court of British Columbia (the "Court"). On    •    , 2016, QLT obtained an interim order of the Court (the "Interim Order") pursuant to Section 291 of the BCBCA, which providesdiffering interpretations. Accordingly, there can be no assurances that we will not be a PFIC for the calling and holding oftaxable year ending with the Special Meeting. A copy ofliquidation (or if earlier, the Interim Order is attached as Appendix "B"taxable year ending December 31, 2019).

            If shareholder approval ofwe have been a PFIC for any taxable year during which a U.S. holder held our common stock, unless the Reorganization of Share Capital pursuantU.S. holder had made a timely qualified electing fund election or mark-to-market election with respect to the Arrangement is obtained andshares, the Board determinesU.S. holder will generally be subject to proceedspecial tax rules in connection with the Arrangement, QLT intends to apply toLiquidation distribution. In general, under the Court for a final order approvingPFIC rules, in connection with the Arrangement (the "Final Order") at the Court House, 800 Smithe Street, Vancouver, British Columbia on    •    , 2016, at 9:45 a.m. (Vancouver time) or so soon thereafter as counsel may be heard. Please see the Requisition for Final Hearing attached as Appendix "C" for further information on participating or presenting evidence at the hearing for the Final Order.

            At the hearing for the Final Order, shareholders and creditors of QLT are entitled to appear in person or by counsel and to make a submission regarding the Arrangement, subject to filing and serving an appearance and satisfying any other applicable requirements.

            At the hearing for the Final Order, the Court will also consider, among other things, the fairness of the terms and conditions of the Arrangement and the rights and interests of every person affected. The Court may approve the Arrangement either as proposed, or subject to such terms and conditions as the Court considers appropriate, or may dismiss the application.


    Recommendation of the Board of Directors

    The Board of Directors unanimously recommends that our shareholders vote "FOR" the approval of the Reorganization of Share Capital.

            In reaching its recommendation the Board of Directors considered, among others, the following factors:Liquidation distribution:

      any excess distribution and/or gain will be allocated ratably over the results ofU.S. holder's holding period for the Company's process to determine the most effective and efficient means to return capital to shareholders and review of strategic alternatives for maximizing shareholder value;common stock;

      information concerning the financial condition, results of operations, business plans and prospects of the Company both before and after giving effectamount allocated to the Reorganization of Share Capital;current taxable year and any taxable years in the U.S. holder's holding period prior to the first taxable year in which we are a PFIC, each a pre-PFIC year, will be taxable as ordinary income;

      the adviceamount allocated to each prior taxable year, other than a pre-PFIC year, will be subject to tax at the highest tax rate in effect applicable to the U.S. holder for that year; and

      an interest charge generally applicable to underpayments of tax will be imposed on the tax attributable to each prior taxable year, other than a pre-PFIC year.

    We cannot provide any assurances regarding our PFIC status for the current or prior taxable years. Regardless of whether you made a qualified electing fund election or mark-to-market election with respect to the shares, we strongly urge you to consult your tax advisor regarding the impact of our PFIC status on your investment in the common stock as well as the application of the Company's managementPFIC rules to your investment in the common stock.

    Backup Withholding

            In order to avoid "backup withholding" of U.S. federal income tax on the Liquidation distribution, each U.S. holder, unless an exception applies, may be required to provide such U.S. holder 's correct taxpayer identification number ("TIN") on IRS Form W-9 (or, if appropriate, another withholding form) and advisors;certify under penalties of perjury that such number is correct and that such shareholder is not subject to backup withholding. If a Company shareholder fails to provide the correct TIN or certification, payments received may be subject to backup withholding at the then prevailing rate (currently at 24%). Backup withholding is not an additional tax. Rather, the tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may generally be obtained from the IRS, provided that the required information is properly furnished in a timely manner to the IRS.


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      The tax consequences of the ability to makeLiquidation Plan may vary depending upon the Special Distribution pursuantparticular circumstances of the shareholder. We recommend that each shareholder consult his, her or its tax advisor regarding the U.S. federal income tax consequences of the Liquidation Plan as well as the state, local and foreign tax consequences.

      This Proxy Statement does not address any tax considerations other than certain Canadian federal income tax considerations and certain material U.S. federal income tax considerations. Shareholders who are resident in jurisdictions other than Canada or the U.S. should consult their own tax advisors with respect to the Reorganization of Share Capital without Canadian withholding taxes of up to 25% being payable.

            The foregoing discussiontax implications in such jurisdictions of the informationLiquidation and factors considered byany distributions that may be made in connection therewith. All Shareholders should consult their own tax advisors regarding provincial, territorial or other tax considerations of the Board of DirectorsLiquidation and any distributions that may be made in connection therewith.


    Consequences if the Liquidation Plan is not intended to be exhaustive. In reaching the determination to propose and recommend that shareholders approve the Reorganization of Share Capital, the Board of Directors did not assign any relative or specific weights to the factors which were considered.Approved

    NOVELION DOES NOT HAVE SUFFICIENT RESOURCES, OPERATIONS OR ASSETS TO CONTINUE AS A STAND-ALONE OPERATING COMPANY. IF THE LIQUIDATION RESOLUTION AND THE LIQUIDATOR RESOLUTION ARE NOT APPROVED, THE FUTURE OF NOVELION WILL BE UNCERTAIN, AND ANY REALIZATION OF VALUE FOR YOUR NOVELION SHARES WILL LIKELY BE SIGNIFICANTLY DELAYED OR YOU MAY NOT REALIZE ANY VALUE FOR YOUR NOVELION SHARES. IF THE LIQUIDATION RESOLUTION AND THE LIQUIDATOR RESOLUTION ARE NOT APPROVED, THE COMPANY MAY APPLY TO COURT FOR AN ORDER THAT A LIQUIDATOR BE APPOINTED AND THAT THE COMPANY BE LIQUIDATED, WOUND UP AND DISSOLVED.


    Vote Required and Board of Director's Recommendation

            AtApproval of the Special Meeting, shareholders will be askedLiquidation Resolution and the Liquidator Resolution would give the Board authority to consider a special resolution authorizing and approvingcomplete, among other things, the Arrangement pursuant to whichLiquidation Plan as described herein.

    Proposal No. 1 Approval of the ReorganizationLiquidation Resolution

            This proposal requires the affirmative vote of Share Capital may be effected. In order for the special resolution to be approved by shareholders, it must be passed by two-thirds of the votes cast by, or on behalf of, the shareholders of the Company entitled to vote present in respect thereofperson or by proxy voting at the SpecialAnnual Meeting.

            As set out above, shareholdersUnless the shareholder directs that the shareholder's common shares are being askedto be voted against the Liquidation Resolution, the persons named in the enclosed Form of Proxy intend to vote only onFOR the Arrangement and not on the Special Distribution or the underlying transactions.Liquidation Resolution.

            The following special resolution will be submitted for a shareholder vote at the SpecialAnnual Meeting:

        "BE IT RESOLVED AS A SPECIAL RESOLUTION OF SHAREHOLDERS THAT:

        1.
        The Company is hereby authorized to voluntarily liquidate, wind-up and dissolve pursuant to section 319 of the BCBCA, which Liquidation shall become effective and commence at a time to be determined by the Board of the Company in accordance with the terms of the Liquidation Plan substantially in the form attached to the Proxy Statement of the Company dated [    ·    ] as "Schedule A — Plan of Liquidation and Distribution";

        2.
        the Liquidation Plan is hereby approved and any officer or director of the Company is authorized to execute and deliver the Liquidation Plan;

        3.
        the Company is hereby authorized to make one or more distributions following the Effective Date by way of a reduction of capital, in an amount not to exceed the capital, provided that the solvency requirements of the BCBCA and section 101 of the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended, are satisfied at the time of the distribution;

        4.
        notwithstanding the provisions hereof, the Board is authorized to delay or determine not to proceed with the implementation of any of the matters contemplated by the foregoing resolutions and the Proxy Statement, without further approval of the shareholders of the Company, if in the opinion of the Board, it is necessary or desirable to do so, and may, pursuant to the provisions of the BCBCA revoke this special resolution at any time before it is acted upon without further approval of the shareholders of the Company; and

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        5.
        any officer or director of the Company be and is hereby authorized, on behalf of and in the name of the Company, to take all necessary steps and proceedings, and to execute and deliver and file any and all declarations, agreements, documents and other instruments and to do all such other acts and things (whether under corporate seal of the Company or otherwise) that may be necessary or desirable to give effect to the provisions of this resolution."

    The Board of Directors unanimously recommends that our shareholders vote "FOR" the Liquidation Resolution.

    Proposal No. 2 Approval of the Liquidator Resolution

            This proposal requires the affirmative vote of a majority of the votes cast by, or on behalf of, the shareholders of the Company entitled to vote present in person or by proxy voting at the Annual Meeting.Unless the shareholder directs that the shareholder's common shares are to be voted against the Liquidator Resolution, the persons named in the enclosed Form of Proxy intend to vote FOR the Liquidator Resolution.

            The following ordinary resolution will be submitted for a shareholder vote at the Annual Meeting:

        "BE IT RESOLVED AS AN ORDINARY RESOLUTION OF SHAREHOLDERS THAT:

        1.
        Alvarez & Marsal Canada Inc. is hereby appointed as the liquidator of the Company pursuant to Section 319(2)(a) of the BCBCA (the "Liquidator") to,inter alia, liquidate the Company in accordance with the BCBCA and wind-up and dissolve the Company in accordance with section 341 to 343 of the BCBCA;

        2.
        the Board is hereby authorized to set the remuneration of the Liquidator;

        3.
        notwithstanding the provisions hereof, the Board is authorized to delay or determine not to proceed with the implementation of any of the matters contemplated by the foregoing resolutions and the Proxy Statement, without further approval of the shareholders of the Company, if in the opinion of the Board, it is necessary or desirable to do so, and may, pursuant to the provisions of the BCBCA revoke this ordinary resolution at any time before it is acted upon without further approval of the shareholders of the Company; and

        4.
        any officer or director of the Company be and is hereby authorized, on behalf of and in the name of the Company, to take all necessary steps and proceedings, and to execute and deliver and file any and all declarations, agreements, documents and other instruments and to do all such other acts and things (whether under corporate seal of the Company or otherwise) that may be necessary or desirable to give effect to the provisions of this resolution."

    The Board of Directors unanimously recommends that our shareholders vote "FOR" the Liquidator Resolution.


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    SPECIAL RESOLUTION TO APPROVE THE REORGANIZATIONPROPOSAL NO. 3: ELECTION OF
    SHARE CAPITAL PURSUANT TO THE ARRANGEMENT DIRECTORS

            "BE IT RESOLVEDBased on the recommendation of the Corporate Governance and Nominating Committee, the Board has nominated Dr. Suzanne Bruhn, Stephen Sabba and Michael Price, our current Executive Vice President and Chief Financial Officer, to serve as a special resolution that:

      1.
      The Arrangement under Section 288directors of theBusiness Corporations Act (British Columbia) set forth Company. If you are voting by proxy, the persons named as proxies in the Planenclosed proxy card will vote to elect as directors the three nominees named below, all of Arrangement attached as Appendix "A" to the Company's Proxy Statement dated January 4, 2016, and all transactions contemplated thereby and any amendment thereto made in accordance with the Plan of Arrangement is authorized and approved.

      2.
      Notwithstanding approval of this special resolution by the Company's shareholders, the Company's Board of Directors may elect not to proceed with the Arrangement, at any time prior to the Arrangement becoming effective.

      3.
      Any director or officerwhom are currently directors of the Company, is authorized,unless you withhold authority to vote for and on behalfthe election of any or all of the Company,directors by delivering a proxy to executethat effect. Upon the Effective Date of the Liquidation, the Board will be deemed to have resigned and deliver all documentspowers of the Board will cease. The Liquidator will then supervise the liquidation of the business and instruments and take such other actions as such director or officer may determine to be necessary or desirable to implement this special resolutionaffairs of Novelion and the matters authorized hereby, such determinationdistribution of assets to be conclusively evidenced byshareholders after the execution and deliverysatisfaction of any such documents or instruments and the taking of any such actions."
    all claims.


    INTEREST OF CERTAIN PERSONS IN MATERIAL TRANSACTIONSInformation Regarding Director Nominees

            UnlessThe persons named below will be presented for election at the Annual Meeting and the persons named in the accompanying form of proxy intend to vote for the election of these nominees. Each director elected at the Annual Meeting will hold office until the next annual general meeting of Novelion or until his or her successor is elected or appointed, unless his or her office is earlier vacated in accordance with the articles of Novelion or with the provisions of the BCBCA.

            The names of the nominees and certain information about them are set forth below:

     
    Name of Nominee and
    Residence

     Age
     Position(s) With the
    Company

     Independent
     Director
    Since

     Principal Occupation
     
    DR. SUZANNE BRUHN
    Massachusetts, USA
     56 Director Yes 2017 Director
     
    MICHAEL D. PRICE
    Florida, USA
     62 Executive Vice President and Chief Financial Officer No Nominee Executive Vice President and Chief Financial Officer of the Company
     
    STEPHEN SABBA
    New York, USA
     60 Director Yes 2012 Partner and Portfolio Manager
     

            There is no family relationship between any of our directors, director nominees or executive officers. The number of common shares owned by each of the nominees for election as a director is set forth under "Security Ownership of Certain Beneficial Owners and Management" in this Proxy Statement.

    Directors

    Suzanne Bruhn, Ph.D., age 56, has served as a director of Novelion since October 2017. Dr. Bruhn currently serves as the President and Chief Executive Officer of Tiaki Therapeutics, Inc., a private biotechnology company. Prior to that she served as the President and Chief Executive Officer of Proclara Biosciences, Inc., a clinical-stage biotechnology company, or Proclara, from April 2017 to September 2018. Prior to joining Proclara, from May 2012 to November 2015, Dr. Bruhn served as President and Chief Executive Officer of Promedior, Inc. She also served as a member of the board of directors of Raptor Pharmaceuticals Corp., a publicly-traded biopharmaceutical company, from 2011 until it was acquired by Horizon Pharma plc in 2016. Previously, Dr. Bruhn served in a number of roles of increasing responsibility at Shire, a biopharmaceutical company, from 1998 until 2012, most recently as Senior Vice President, Strategic Planning and Program Management. Dr. Bruhn currently also serves on the board of directors of Aeglea BioTherapeutics, Inc., a publicly-traded biotechnology company focused on the treatment of rare genetic diseases and cancer, and Pliant Therapeutics, a private biotechnology company. Dr. Bruhn received her B.S. degree in Chemistry from Iowa State University and her Ph.D. in Chemistry from Massachusetts Institute of Technology.

            The Board has concluded that Dr. Bruhn is well-qualified to serve on the Board and has the requisite qualifications, skills and perspectives derived from her extensive experience in the biopharmaceutical industry, including her expertise in the development and commercialization of treatments for rare diseases.


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    Michael D. Price, age 62, has served as our EVP and Chief Financial Officer since July 16, 2018 and, prior to that, as our Senior Vice President and Chief Financial Officer since December 4, 2017. Prior to joining Novelion in November 2017 as Senior Vice President, Finance, Mr. Price served as Vice President and Chief Financial Officer for Noven Pharmaceuticals from November 2007 to March 2016. Noven was publicly traded until its acquisition by Hisamitsu Pharmaceutical Company in August 2009. Prior to joining Noven in 2007, Mr. Price was Vice President, Chief Financial Officer, Treasurer, and Secretary for Bentley Pharmaceuticals, a publicly-traded pharmaceutical company, from March 1992 until September 2006. Mr. Price began his career with Price Waterhouse (now PricewaterhouseCoopers), where his client base was concentrated in the life sciences/healthcare sector. Mr. Price is a certified public accountant. He holds a B.S. degree in Business Administration (Accounting) from Auburn University and a M.B.A. degree from Florida State University.

            The Board has determined to nominate Mr. Price to our Board, on the recommendation of the Corporate Governance and Nominating Committee, based on his extensive financial experience and deep institutional knowledge of the Company.

    Stephen Sabba, M.D., age 60, has served as a director of Novelion since 2012. Currently, Dr. Sabba is also a Partner and Health Care Portfolio Manager at Knott Partners, LP, an investment fund, and a director of Ligand Pharmaceuticals Inc., a public biotechnology company, positions he has held since 2006 and 2008, respectively. Previously, from 2001 to 2006, he was a Partner and Director of Research with Kilkenny Capital Management, a Chicago-based hedge fund. Dr. Sabba received his medical degree from the New York University School of Medicine, and completed a residency in internal medicine and a fellowship in gastroenterology at the Veterans Administration Medical Center in New York City. He earned a B.S. degree with honors at Cornell University.

            The Board has concluded that Dr. Sabba is well-qualified to serve on the Board and has the requisite qualifications, skills and perspectives based on his capital markets and financial expertise gained from his experience working in the hedge fund and investment fund industries.


    Cease Trade Order

            Each of Dr. Bruhn, Mr. Price and Dr. Sabba are subject to the general "failure to file" cease trade order issued on August 20, 2019 by the British Columbia Securities Commission and the Ontario Securities Commission (on behalf of the applicable Canadian securities regulatory authorities) as a result of Novelion being unable to file its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 by the applicable filing deadline. For more information on the cease trade order, please refer to Novelion's press release dated August 21, 2019.


    Majority Voting Policy

            The Board has adopted a Majority Voting Policy which requires that any nominee for director for which there are a greater number of votes "withheld" than votes "for" his or her election will be required to tender his or her resignation as a director of the Company. This policy applies only to uncontested elections, which are elections in which the number of nominees for election as director is equal to the number of positions available on the Board. If a nominee for director is required under the Majority Voting Policy to tender his or her resignation, the Board will refer the resignation to the Corporate Governance and Nominating Committee (except in certain circumstances, in which case the entire Board will review the resignation without reference to the Corporate Governance and Nominating Committee) which will consider the director's resignation and will recommend to the Board whether or not to accept it. The Corporate Governance and Nominating Committee will generally be expected to recommend accepting the resignation, except in situations where extraordinary circumstances would warrant the applicable director to continue to serve on the Board. The Board will act on the Corporate Governance and Nominating Committee's recommendation within 90 days following the certification by the scrutineer of the voting results of the applicable annual meeting and will promptly disclose by press release its decision whether to accept the director's resignation, including the reasons for rejecting the resignation, if applicable. A director who tenders his or her resignation pursuant to the Majority Voting Policy will not participate in any meeting of the Board or the Corporate Governance and Nominating Committee at which the resignation is considered.


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    Advance Notice Policy

            The Board has adopted an Advance Notice Policy which was ratified and approved by shareholders at our 2014 annual general meeting. The intention of the Advance Notice Policy is to facilitate an orderly and efficient annual general meeting or, where the need arises, special meeting, to ensure that all shareholders receive adequate notice of director nominations and sufficient information with respect to all nominees, and allow shareholders to register an informed vote having been afforded reasonable time for appropriate deliberation.

            Pursuant to the Advance Notice Policy, any additional director nominations for an annual general meeting must be received by the Company not less than 30 nor more than 65 days prior to the date of the meeting. If no nominations are received by October 6, 2019, being the date which is 30 days prior to the Annual Meeting date, management's nominees for election as directors set forth below shall be the only nominees eligible to stand for election at the Meeting.


    Vote Required and Board of Directors' Recommendation

            Under the BCBCA and the Articles of Novelion, directors are elected by a plurality of the common shares voted at the Annual Meeting. This means that the three nominees with the most votes for election would be elected, subject to the requirements of our Majority Voting Policy, as described above.

    The Board unanimously recommends that our shareholders vote "FOR" the election each of the three nominees for director.


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    CORPORATE GOVERNANCE

    Investors are cautioned that the historical corporate governance discussion below is not necessarily indicative of the Company's current or near-term corporate governance policies and procedures and website resources related thereto, given the Company's significantly scaled-down operations and related cost-reduction initiatives, which have been and will continue to be implemented, in furtherance of the Company's expected winding up and dissolution.

    It is expected that, in connection with the Company's winding up initiatives, in order to preserve resources and limit administrative costs, the Board selection process, committee roles and membership, and overall corporate governance will be significantly streamlined and the policies and approaches required to be described herein will not be indicative of Novelion's corporate governance on a go-forward basis.


    Overview of Our Corporate Governance Principles

            The Board has adopted corporate governance guidelines to assist and guide its members in the exercise of their responsibilities. We review our corporate governance policies periodically, monitor emerging developments in corporate governance and update our policies and procedures when the Board determines that it would benefit Novelion and its shareholders to do so. These guidelines should be interpreted in accordance with any requirements imposed by applicable federal or state law or regulation, exchange requirements, and our organizational documents.

            Our corporate governance guidelines can be found at http://ir.novelion.com/corporate-governance.cfm. Although these corporate governance guidelines have been approved by the Board, it is expected that these guidelines will evolve over time as customary practice and legal requirements change. In particular, those guidelines that encompass legal, regulatory or exchange requirements as they currently exist will be deemed to be modified as and to the extent that such legal, regulatory or exchange requirements are modified. In addition, the guidelines may also be amended by the Board at any time as it deems appropriate.

            Currently, our Global Code of Conduct (the "Code of Conduct") and committee charters can be found at Novelion's website atwww.novelion.com under "Governance." These documents will also be provided without charge to any shareholder who requests them.


    Code of Conduct

            Novelion has adopted the Code of Conduct which is applicable to all directors, officers and employees of Novelion and its affiliates. As further described in the charter of the Audit Committee, the Audit Committee is responsible for reviewing, at least on an annual basis and with management and its principal financial and accounting officer, compliance with the Code of Conduct, the adequacy of and any requests for waivers under the Code of Conduct and to make recommendations to the Board with regard to any waiver sought with respect to any executive officer or director. As further described in the charter of the Compliance Committee, the Compliance Committee is responsible for reviewing and assessing the adequacy of the Code of Conduct periodically, but at least annually, and to recommend any proposed changes to the Board for approval.

            If required, we intend to disclose on our website any amendment or waiver of a provision of the Code of Conduct that is required to be disclosed by applicable SEC rules and regulations.

            Novelion complies with the provisions of the BCBCA that deal with conflict of interest situations. Novelion, through directors' and officers' questionnaires and other systems, also gathers and monitors relevant information in relation to potential conflicts of interest that a director or officer may have.


    Gender Diversity

            The Board has adopted a policy to reflect its commitment to diversity and inclusion in all levels in the workplace and on the Board (the "Diversity Policy"). While the Diversity Policy does not specifically target the identification and nomination of women directors or nomination of directors of a particular race, ethnicity or culture, it does require the Board and the Corporate Governance and Nominating Committee to consider


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    diversity (including gender, as well as age, geography, members of minority groups and persons with disabilities) as an element in the overall selection criteria of new Board members and executive officer appointments.

            The Company does not support the adoption of quotas as the Board believes that quotas do not necessarily result in the selection of the best candidates and, accordingly, no specific targets have been set for female Board members or female executive officers.


    Mandate of the Board and the Chair of the Board

            The Board is responsible for the supervision of the management of the business and affairs of Novelion, the stewardship of Novelion and the enhancement of shareholder value. The Board has adopted a written mandate, which is applicable to all directors, and which has formalized its position on corporate governance (the "Mandate of the Board"). The Board has also developed a written mandate regarding the position of Chair of the Board, which is detailed in the Mandate of the Chair of the Board and described below under the heading "Board Leadership Structure." The Mandate of the Board, which is incorporated by reference into this Proxy Statement and which is available on SEDAR at www.sedar.com, and the Mandate of the Chair of the Board are each available on our website atwww.novelion.com. Copies of each will be provided without charge to any shareholder who requests them by writing to "Novelion Investor Relations," c/o Norton Rose Fulbright, 1800 — 510 West Georgia Street, Vancouver, BC V6B 0M3 Canada. The Corporate Governance and Nominating Committee of the Board is charged with reviewing and ensuring that good corporate governance practices and the Mandate of the Board are followed. The Corporate Governance and Nominating Committee is also responsible for reviewing and, if determined appropriate, updating the Mandate of the Board.


    Role of the Board in Risk Oversight

            The Board is actively involved in overseeing risk management for Novelion. In accordance with the Mandate of the Board, the Board, as a whole, oversees the development and application of policies regarding corporate governance, and is responsible for adopting the corporate strategies and plans for Novelion's business, identifying the principal risks of Novelion's business and ensuring the implementation of the appropriate systems to manage these risks, overseeing compliance with applicable laws and regulations, overseeing the integrity of Novelion's internal controls, disclosure procedures and management information systems, and maintaining a continuing dialogue with senior management in order to ensure Novelion's ability to respond to changes, both internal and external, which may affect its business operations from time to time. This oversight is also conducted through standing committees of the Board. The Board receives full reports from each committee Chair regarding the committee's consideration and actions. The oversight responsibility of the Board and its committees is enabled by management reporting processes that are designed to provide visibility to the Board about the identification, assessment and management of critical risks. These areas of focus include; financial reporting, compliance, compensation and operations, as summarized below.

            The Audit Committee reviews and discusses with management significant financial risks and the actions management has taken to monitor and mitigate potential exposures. The Audit Committee also assesses other areas of enterprise risk exposure, such as the disclosure controls and procedures, internal controls over financial reporting, whistleblower procedures and information technology systems.

            The Corporate Governance and Nominating Committee oversees risk management as it relates to, among other things, the development and assessment of our corporate governance framework and CEO, Board and Chair succession, including board and committee nominations, membership and standards, and potential conflicts of interest.


    Board Leadership Structure

            We have been operating under a corporate governance structure where the Chair of the Board and the CEO were separate positions held by different individuals. Due to the demands of each position, we believe separating these roles enhances the ability of each to discharge his duties and fosters more accountability. Our leadership structure will be streamlined as we proceed towards a winding up and dissolution; however, the Board is expected to determine and implement the most appropriate mechanism to fulfill its oversight responsibilities.


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    Given the changes to the Board, the position of Chair of the Board has not been determined post-Annual Meeting, but it will be one of the independent directors.


    Board Attendance

            It is a policy of the Board to encourage directors to attend regular Board meetings, Board committee meetings on which they serve and each annual general meeting of the shareholders. Each of the incumbent directors of the Board attended at least 75% of all meetings of the Board and meetings of committees of the Board upon which they served (during the periods that they served) during 2018. All of the directors who served on the Board as of the time of our 2018 annual general meeting on August 9, 2018 (the "2018 Annual Meeting") attended the meeting, except for Mr. Aryeh whose term expired at the 2018 Annual Meeting.

            The Board held 29 meetings (in person or by teleconference) in 2018. During the period from January 1, 2018 to December 31, 2018, attendance by the directors at meetings of the Board was as follows:

    Director
    Board Meetings

    Jason Aryeh*

    9 of 16

    Dr. Suzanne Bruhn

    29 of 29

    Mark Corrigan, M.D.

    28 of 29

    Mark DiPaolo*

    18 of 19

    Kevin Kotler*

    18 of 19

    John Orloff

    28 of 29

    Dr. Stephen Sabba

    29 of 29

    Donald K. Stern

    28 of 29

    John C. Thomas, Jr.

    26 of 29
    *
    Mr. DiPaolo resigned from the Board on September 13, 2018 and Mr. Kotler resigned from the Board on September 24, 2018. Mr. Aryeh's term expired at our 2018 Annual Meeting on August 9, 2018.


    Director Nomination Process

            To assist with director nominations, the Board has delegated the director selection and nomination process to the Corporate Governance and Nominating Committee. In evaluating prospective nominees, the Corporate Governance and Nominating Committee looks for the following minimum qualifications: experience at a strategic or policy-making level in a business, government, non-profit or academic organization of high standing; accomplishments in his or her respective field with superior credentials and recognition; high standards of integrity, ethics, commitment and independence of thought and judgment; significant business or professional experience or a demonstrated exceptional understanding of the pharmaceutical industry or other disciplines relevant to the business of the Company; sufficient time and availability to devote to the affairs of the Company, particularly in light of the number of boards on which the nominee may serve; and, to the extent a nominee serves or has previously served on other boards, a demonstrated history of active contribution to board meetings. In evaluating prospective nominees (which process involves interviews and background checks), the Corporate Governance and Nominating Committee also takes into account shareholder support of prospective nominees in previous director elections of the Company, any direct experience in the pharmaceutical industry or markets in which the Company operates and any experience as a board member of other public companies. All nominees are selected with a view to the best interests of Novelion as a whole.

            To foster and maintain a diversity of viewpoints, backgrounds and experience on the Board, the Corporate Governance and Nominating Committee evaluates the mix of skills and experience of the directors and assesses nominees and potential candidates in the context of the current composition of the Board and Novelion's objectives. In searching for a new director, the Corporate Governance and Nominating Committee identifies particular areas of specialization that it considers beneficial, in addition to the general qualifications, having


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    regard to the skill sets of the other members of the Board. Further, in accordance with the Diversity Policy, while the Company does not support the adoption of quotas, management and the Board will consider diversity as an element of the overall selection criteria of candidates. All nominations proposed by the Corporate Governance and Nominating Committee are subject to the approval of the Board. Potential nominees are interviewed in person before any nomination is recommended to the Board.

            The Board will also consider any director nominees proposed by shareholders. Shareholders may submit nominations to the Board by addressing a communication to the Chair of the Corporate Governance and Nominating Committee and providing sufficient information to the Corporate Governance and Nominating Committee to permit it to conduct an assessment of the qualifications of the proposed nominee, including biographical information about the candidate and his or her professional experience, confirmation of the candidate's willingness to serve as a director, and complete contact information for the candidate and the nominating shareholder. The method by which a shareholder may communicate with the Corporate Governance and Nominating Committee are set out in the Security Holder Communications Policy which can be found on Novelion's website atwww.novelion.com. As a matter of policy, the Corporate Governance and Nominating Committee is committed to giving due and fair consideration to proposed nominations submitted by shareholders using the same criteria and processes as other nominations that come before it.

            The Board has also adopted an amended and restated advance notice policy (the "Advance Notice Policy") for the receipt of nominations to the board in advance of annual general or special meetings of shareholders, as applicable. For more details with respect to the Advance Notice Policy, see "Proposal No. 3: Election of Directors — Advance Notice Policy."


    Independence of Directors

            To ensure that we maintain good and objective governance, the Board strives to maintain strong independence from management. In determining whether directors are independent, each year the Board considers and discusses the nature and materiality of all direct or indirect relationships between each director, or nominee, and Novelion, including any family or business relationships, for the purposes of determining whether a material relationship exists that might signal a potential conflict of interest or otherwise interfere with such director's ability to satisfy his or her responsibilities as an independent director. Under the applicable Canadian and U.S. securities laws, a relationship is considered material where that relationship could, in the view of the Board, reasonably interfere with the exercise of the director's independent judgment. A director who also serves as CEO, or, depending on duration of term, interim CEO, of a company would be considered a non-independent director of that company under applicable Canadian and United States securities laws. As a result, and in connection with its 2018 annual review of the nature and materiality of all direct or indirect relationships between each director and Novelion and its subsidiaries, the Board has determined that none of its directors, other than Dr. Orloff (a former Executive Vice President of Novelion), has any relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and is "independent" within the meaning of our director independence standards and the independence standards of Nasdaq and the SEC rules and regulations, as applicable. In addition, the Board has determined that each director who served as a member on each of the Audit Committee, the Compensation Committee and the Corporate Governance and Nominating Committee during 2018 was "independent" within the meaning of our director independence standards and the independence standards of Nasdaq and the SEC, as applicable, including Rule 10a-3(b)(1) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and National Instrument 52-110 —Audit Committees.


    Orientation and Continuing Education Programs

            As and when a new Board nominee is appointed, the Board will ensure that a program of orientation and education is provided for the nominee, including, but not limited to, information on our corporate history, copies of past minutes of meetings of the Board and the Mandate of the Board, and information regarding our business and operations. The Corporate Governance and Nominating Committee is responsible for reviewing the current orientation and education program and recommending and initiating improvements to this program as warranted. As part of the ongoing commitment of the Board to effective governance and director continuing


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    education, our directors are encouraged to periodically attend accredited courses on current trends in corporate governance and other relevant areas.


    Assessments

            The Board has an annual formal assessment process with respect to performance of the Board and its committees. The Board as a whole considers the contributions and performance of the Board and each of its committees by conducting a performance review questionnaire. The Board uses this assessment to determine whether additional expertise is required to ensure that the Board is able to discharge its responsibilities and individuals with specific skill sets are identified.


    Term and Age Limits

            The Board has not adopted policies imposing any term or retirement age limit in connection with individuals nominated for election as directors because the Board considers the assessments of the contributions of individual directors and its annual review process to be more effective than term limits or other mechanisms of Board renewal, such as setting a mandatory retirement age.


    Executive Session of Independent Directors

            The independent members of the Board meet without management and non-independent directors present during sessions following periodic Board meetings (unless the independent directors determine such a session is not required).


    Communicating with the Board of Directors

            The Board has approved a Security Holder Communications Policy that can be found on our website atwww.novelion.com. Pursuant to this policy, shareholders who wish to address questions regarding our business directly with the Board as a whole, or with any individual director, should direct his or her questions in writing to the attention of the Secretary of Novelion at:

    Novelion Therapeutics Inc.
    c/o Norton Rose Fulbright
    1800 — 510 West Georgia Street, Vancouver, BC V6B 0M3 Canada

            Communications will be distributed to the Board, or to any individual director or directors, as appropriate, depending on the facts and circumstances outlined in the communications.

            Shareholders and other interested persons may submit concerns regarding accounting matters by following the instructions for making a report published in the Corporate Governance subsection of the Investors section of our website.


    Board of Directors and Board Committees

            The Board has maintained a standing Audit Committee, Corporate Governance and Nominating Committee and Compensation Committee. From time to time, the Board has and may establish special committees to assist the Board with respect to certain matters.


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            Set forth below is a chart indicating, by committee, each of the Audit Committee's, Corporate Governance and Nominating Committee's and Compensation Committee's members as of the date of this Proxy Statement and the key functions of the committees. Investors are cautioned that the Board and its committees are expected to change considerably as Novelion undertakes streamlining its operations and corporate governance upon the closing of the Aegerion Restructuring.

    Committee
    Members
    Number
    of
    Meetings

    Key Functions

    Audit

    John C. Thomas, Jr.*
    Mark Corrigan
    Stephen Sabba

    The Board has determined that each member of the audit committee is "independent" for audit committee purposes as that term is defined under Rule 10A-3 of the Exchange Act, and the applicable Nasdaq rules. Each member of the Audit Committee meets the requirements for financial literacy under the applicable rules and regulations of the SEC and Nasdaq. The Board has designated Mr. Thomas as an "audit committee financial expert," as defined under the applicable rules of the SEC.
    9

    Appoints, approves the compensation, and assesses the independence of our independent auditors;

    Pre-approves audit and permissible non-audit services to be provided by our auditors and the terms of these services;

    Reviews and recommends to the Board the approval of the audited financial statements; reviews and approves the interim financial statements and earnings releases prior to filing;

    Coordinates the oversight and reviews the adequacy of our internal controls over financial reporting and our disclosure controls and procedures;

    Oversees our accounting and financial reporting practices;

    Reviews the management of corporate financial risks and related party transactions in accordance with Novelion's Related Party Transaction Policy;

    Establishes, oversees and periodically assesses the procedures for the receipt and retention of complaints and concerns regarding accounting, internal accounting controls, or auditing;

    Reviews, at least annually with management, compliance with our Code of Conduct;

    Establishes procedures regarding the receipt, retention and consideration of any report of evidence of a material violation of applicable U.S. or Canadian securities laws or a material breach of fiduciary duty by our directors, officers, employees or agents, and initiates and oversees any investigations arising therefrom;

    Reviews and assesses the adequacy of the Audit Committee Charter annually and recommends to the Board any amendments or modifications that the Audit Committee deems appropriate; and

    Reviews, discusses, and assesses the Audit Committee's performance as well as its role and responsibilities at least annually, seeking input from senior management, the Board, and others as the Audit Committee deems appropriate.


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    Committee
    Members
    Number
    of
    Meetings

    Key Functions

    Corporate Governance and Nominating

    Suzanne Bruhn
    Mark Corrigan
    Donald Stern

    The Board has determined that each member of the Corporate Governance and Nominating Committee is "independent" as that term is defined in the applicable SEC and Nasdaq rules.
    3

    Develops and recommends to the Board criteria for identifying, selecting and evaluating nominees for appointment or election as members of the Board and committee members;

    Identifies, considers and recommends to the Board qualified individuals for nomination for election or to fill Board vacancies;

    Considers director nominees recommended by shareholders, and oversees the Company's policies and procedures with respect to these nominations;

    Retains, oversees and terminates search firms used to identify director candidates, legal counsel or other advisers, including approval of their fees and terms of retention;

    When required, expeditiously considers any resignation tendered by a director pursuant to the Company's Majority Voting Policy in accordance with the provisions of such policy and recommends to the Board whether to accept, delay accepting or reject such resignation;

    Reviews annually the Corporate Governance and Nominating Committee's Charter and each of the Mandate of the Board and the Mandate of the Chair of the Board, and recommends changes to the Board;

    Develops, oversees and reviews Board governance principles and the effectiveness of corporate governance for recommendation to the Board;

    Evaluates the size, composition and structure of the Board and Board committees for recommendation to the Board;

    Develops and oversees the Board continuing education program and the orientation program;

    Coordinates and oversees an annual process to assess the effectiveness of the Board and individual members of the Board;

    Develops succession plans for the Chair of the Board and the CEO; and

    Reviews compliance with share ownership guidelines by members of the Board and executive officers.


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    Committee
    Members
    Number
    of
    Meetings

    Key Functions

    Compensation

    Stephen Sabba*
    Suzanne Bruhn
    John C. Thomas, Jr.

    The Board has determined that each member of the Compensation Committee is "independent" as that term is defined in the applicable SEC and Nasdaq rules.
    6

    Reviews and recommends to the Board the corporate goals relevant to the compensation of the CEO, and evaluates and makes recommendations to the Board concerning the performance of the CEO against those goals;

    Considers any risks associated with proposed CEO compensation arrangements and potential ways to mitigate such risks;

    Determines the compensation and employment agreement terms for all executive officers of the Company;

    Reviews and makes recommendations to the Board concerning the director compensation program;

    Provides oversight of management's decisions regarding the compensation of senior management;

    Manages, administers, reviews and makes recommendations to the Board with respect to short and long-term incentive-based compensation plans and equity-based plans;

    Manages and administers all equity-based plans, and reviews and makes recommendations with regard to policies and procedures for the grant of equity-based awards;

    Reviews, discusses with management and recommends the Compensation Discussion and Analysis for inclusion in the Company's Proxy Statement or Form 10-K;

    Develops and proposes share ownership guidelines for members of the Board and executive officers;

    Reviews and assesses the adequacy of the Compensation Committee Charter annually and submits any proposed changes to the Board for approval;

    Performs an annual performance evaluation of the Compensation Committee and reports to the Board on the results of such evaluation; and

    Exercises sole authority to retain, terminate and approve any fees and other retention terms of any consulting firm, independent legal counsel or other outside adviser on compensation matters that is to be used by the Company or the Compensation Committee to assist in the evaluation of director, CEO or executive officer compensation.

    *
    Chair

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    Committee Chairs

            The Board has not developed written position descriptions for the Chair of each of the committees of the Board. The Chair of each committee has accepted leadership responsibilities of the committee including setting the agenda for and chairing the meetings, liaising with management as appropriate, as well as for ensuring fulfillment of the mandate set out in the charters of the committees.


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    COMPENSATION OF DIRECTORS

    Director Compensation

            Our non-employee directors receive cash and equity-based compensation for their services on the Board as described below.

    Cash Compensation

            The cash compensation component of our non-employee director compensation program includes annual cash Board and committee member or Chair, Executive Committee or Executive Chair retainers. Non-employee directors are also eligible for reimbursement of their expenses incurred in connection with attendance at Board meetings, in accordance with our policies, and reimbursement for preparation of annual Canadian tax returns. Non-employee director retainers are paid to the Board quarterly in arrears.

            Fees payable to our non-employee directors for our standing committees in 2018 were as follows:

    Nature of Board Duty
     Fee (US$) 

    Annual Board Retainer Fee:

        

    •    for all directors

     $40,000 

    •    additional retainer for Chair of the Board

      40,000 

    Additional Annual Retainer Fee for Chair of the:

        

    •    Audit Committee

      20,000 

    •    Compensation Committee

      15,000 

    •    Corporate Governance and Nominating Committee

      10,000 

    •    Compliance Committee

      20,000 

    •    Scientific & Innovation Committee

      10,000 

    Additional Annual Retainer Fee for Non-Chair Member of the:

        

    •    Audit Committee

      10,000 

    •    Compensation Committee

      7,500 

    •    Corporate Governance and Nominating Committee

      5,000 

    •    Compliance Committee

      10,000 

    •    Scientific & Innovation Committee

      5,000 

    Additional fee to perform Board or committee business (other than attendance at a Board or committee meeting) at the specific request of the Board or relevant committee:

        

    •    if no out-of-town travel is required

      1,500 

    •    if out-of-town travel is required

      3,000 

    Fee to Novelion Board member for attending operating subsidiary Board meeting as a member of the Board of the operating subsidiary (whether in person or by telephone)

      1,500 

            In addition, non-employee directors are generally entitled to receive annual cash retainers and other fees for service on any ad hoc committees that the Board may establish from time to time commensurate with the level of efforts expected to be undertaken by such committee (which may also include an increased retainer fee for the chair of any such committee).

    Equity-Based Compensation

            In addition to cash compensation, our non-employee directors also receive equity-based compensation to ensure that their interests are aligned with those of our shareholders.

            Non-employee directors are eligible to receive grants of stock options and restricted stock units under our 2017 Equity Incentive Plan (the "Equity Incentive Plan"). We also maintain a non-qualified deferred compensation arrangement for our non-employee directors, in the form of deferred stock units ("DSUs"), which are converted to cash only when a director ceases to be a member of the Board; DSUs have not been granted since our merger with Aegerion in November 2016.

            In August 2018, following our annual meeting of shareholders and upon the recommendation of the Compensation Committee, the Board approved a grant of an option to purchase 10,000 of our common shares


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    to each non-employee director and a grant of an option to purchase 50,000 of our common shares to our Executive Chair. The stock options were granted with an exercise price per share equal to the closing price of our common shares on the grant date, and vest in 12 equal monthly installments commencing on the monthly anniversary of the grant date, subject to continued service on the Board through each applicable vesting date.

            The following table provides information regarding the compensation earned by our non-employee directors in 2018:

    Name(1)
     Fees Earned or
    Paid in Cash ($) USD(2)
     Option
    Awards ($)(3)
     Total 

    Suzanne Bruhn

     $53,664 $15,187(4)$68,851 

    Mark Corrigan

      241,010(5)(6) 75,935(4) 316,945 

    John Orloff

      50,000  15,187(4) 65,187 

    Stephen Sabba

      65,000  15,187(4) 80,187 

    Donald K. Stern

      62,842  15,187(4) 78,029 

    John C. Thomas, Jr. 

      67,500  15,187(4) 82,687 

    Jason Aryeh

      163,428(5)(7) 10,565(8) 173,993 

    Mark DiPaolo(9)

      37,038  15,187(4) 52,225 

    Kevin Kotler(10)

      42,298  15,187(4) 57,485 

     $782,780 $192,809 $975,589 

    (1)
    Mr. Aryeh did not stand for re-election at the 2018 annual meeting of shareholders and his term as a director therefore ended on August 9, 2018. Mr. DiPaolo resigned from the Board on September 13, 2018, and Mr. Kotler resigned from the Board on September 24, 2018.

    (2)
    Represents the aggregate dollar amount of 2018 fees earned or paid in cash for services as a director, including annual retainer fees and committee fees.

    (3)
    Represents the aggregate grant date fair value of stock options, as applicable, calculated in accordance with ASC Topic 718. Such aggregate grant date fair values do not take into account any estimated forfeitures related to service-based vesting conditions. The valuation assumptions used in determining such amounts are described in Note 12 to the audited consolidated financial statements in our Annual Report on Form 10-K filed on March 15, 2019. The amounts reflect the accounting cost for the stock options, as applicable, and do not correspond to the actual economic value that may be received by the non-employee directors upon exercise of the stock options or sale of any underlying common shares.

    (4)
    Represents time-based stock options granted on August 9, 2018 under the Equity Incentive Plan, which vest in twelve equal monthly installments, beginning one month after the grant date, subject to continued service through each applicable vesting date.

    (5)
    Includes a special one-time payment of $70,000 to each of Dr. Corrigan and Mr. Aryeh for their service on the Executive Committee of the Board from November 2017 through May 2018.

    (6)
    Includes $21,000 in fees paid to Dr. Corrigan on a monthly basis in connection with his tenure as Executive Chair, effective July 2, 2018.

    (7)
    Includes cash paid to Mr. Aryeh in connection with the settlement of his DSUs upon the termination as a non-employee director.

    (8)
    Represents the incremental fair value, calculated in accordance with ASC Topic 718, of the modification of the vesting of Mr. Aryeh's stock option awards, in connection with his termination as a non-employee director on August 9, 2018. The Board approved the full acceleration of vesting of Mr. Aryeh's unvested stock options and an extension of the post-termination exercise period of his stock options from 90 days to one year from the termination date of August 9, 2018.

    (9)
    Fees earned by Mr. DiPaolo were paid to Sarissa Capital Management LP.

    (10)
    Fees earned by Mr. Kotler were paid to Broadfin Healthcare Master Fund, Ltd.

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    Director Awards Outstanding as of December 31, 2018

    Name
     Total Outstanding
    Stock Options(1)
     Total
    Outstanding
    DSUs(2)
     

    Suzanne Bruhn

      19,600   

    Mark Corrigan

      59,600   

    John Orloff

      19,600   

    Stephen Sabba

      29,600  5,680 

    Donald K. Stern

      19,600   

    John C. Thomas, Jr. 

      29,600  5,680 

    Jason Aryeh

      29,600   

      207,200  11,360 

    (1)
    Messrs. DiPaolo and Kotler did not hold any stock options as of December 31, 2018. Due to their resignations as non-employee directors in 2018, all the unvested stock options were cancelled upon their respective resignation date; the vested stock options expired 90 days after each resignation date on September 13, 2018 and September 24, 2018, respectively.

    (2)
    DSUs are settled in cash and can only be settled once a director ceases to be a member of the Board.

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    EXECUTIVE OFFICERS

            The following table sets forth the name, age and position of each of our current executive officers (other than Michael D. Price, the Executive Vice President and Chief Financial Officer, whose biography appears above under the caption "Proposal No. 3: Election of Directors"):

    Name
    Age
    Position(s) with the Company
    BEN HARSHBARGER51Interim Chief Executive Officer ("CEO") and General Counsel
    LINDA BUONO53Senior Vice President, Human Resources
    ROGER LOUIS64Global Chief Compliance Officer and Interim Head of Research and Development ("R&D")

    Ben Harshbarger has served as our Interim CEO since November 2018 and as our General Counsel since November 2016. Mr. Harshbarger was Acting General Counsel at Aegerion from September 2015 to August 2016 and General Counsel from August 2016 to November 2016. Prior to that, he served as Aegerion's VP, EMEA Legal Counsel from January 2014 to September 2015 and as Aegerion's VP, Deputy General Counsel from April 2012 to January 2014. Before joining Aegerion, Mr. Harshbarger served as Senior Director, Corporate Counsel at Cubist Pharmaceuticals, Inc. from March 2008 to March 2012, and Senior Director, Deputy General Counsel at ViaCell, Inc. from March 2006 to March 2008. Mr. Harshbarger served in several legal positions of increasing responsibility at Biogen Idec Corporation from November 2001 to March 2006 and served as an associate at the law firm of Mintz Levin from 1996 to 2001. Mr. Harshbarger has a J.D. from Boston College Law School and a B.A. from the University of Richmond.

    Linda Buono has served as our Senior Vice President, Human Resources since November 2016. Prior to this, Ms. Buono was Senior Vice President, Human Resources at Aegerion from August 2016 to November 2016. From March 2016 to August 2016, she served as Aegerion's Vice President, Human Resources. Prior to that, Ms. Buono, held a series of positions with ImmunoGen, most recently as Executive Director, Human Resources since July 2013 and Senior Director, Human Resources from July 2008 through June 2013.

    Roger Louis has served as our Interim Head of R&D since October 2018 and as our Senior Vice President, Global Chief Compliance Officer since November 2016. Prior to this, Mr. Louis was Senior Vice President, Global Chief Compliance Officer at Aegerion from November 2015 to November 2016. Mr. Louis has extensive experience in compliance and risk management having served most recently as Senior Vice President, Compliance & Risk Management, Chief Compliance Officer at Cubist Pharmaceuticals from August 2013 until its acquisition by Merck in January 2015. Mr. Louis joined Cubist Pharmaceuticals from Biogen Idec Corporation where he was Senior Vice President, Chief Compliance Officer. From 1997 to 2012, he held positions of increasing responsibility at Genzyme Corporation, including Senior Vice President, Chief Compliance Officer. Mr. Louis began his legal career as an Associate at Hale & Dorr LLP (now WilmerHale) in Boston where he practiced corporate and securities law. Mr. Louis received his J.D. from University of Chicago School of Law and his B.A. from Tufts University.


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    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

            The following table sets forth information with respect to the beneficial ownership of our common shares as of September 13, 2019 (unless otherwise noted) with respect to:

      each person, or group of affiliated persons, known to us to be the beneficial owner of more than 5% of our common shares outstanding as of such date ("5% Shareholders"), based on currently available Schedules 13G and 13D filed with the SEC, as may be updated by a Statement of Change of Beneficial Ownership of Securities on Form 4 subsequently filed with the SEC;

      each of our NEOs and directors; and

      all of our current executive officers and directors as a group.

            Beneficial ownership is determined in accordance with the rules of the SEC and the applicable Canadian securities regulators. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities and include common shares issuable upon the exercise of stock options or other securities that are immediately exercisable or exercisable within sixty days after September 13, 2019, although these shares are not deemed outstanding for the purpose of computing percentage ownership of any other person. Inclusion of shares of common share in the following table does not constitute an admission that the named shareholder is a direct or indirect beneficial owner for any other purpose. Except as otherwise indicated, all of the shares reflected in the table are our common shares, and all persons listed below have sole voting and investment power with respect to the common shares beneficially owned by them, subject to applicable community property laws. The information is not necessarily indicative of beneficial ownership for any other purpose. Percentage of ownership is based on 19,618,946 common shares outstanding as of September 13, 2019.


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            Except as otherwise indicated in the table below, addresses of named beneficial owners are c/o Novelion Therapeutics Inc., c/o Norton Rose Fulbright, 1800 — 510 West Georgia Street, Vancouver, BC V6B 0M3 Canada.

     
     Amount and Nature of Beneficial
    Ownership
      
      
     
     
     Total Beneficial
    Ownership
     
     
      
     Shares for Which
    Beneficial Ownership
    May Be Acquired Within
    60 Days(2)
     
    Name of Beneficial Owner(1)
     Shares
    Beneficially
    Owned
     Number of
    Shares(3)
     Percent of
    Class
     

    Directors and Named Executive Officers

                 

    Suzanne Bruhn

        19,600  19,600  * 

    Mark Corrigan

        59,600  59,600  * 

    John Orloff

        19,600  19,600  * 

    Stephen Sabba

      7,400  29,600  37,000  * 

    Donald K. Stern

      2,500  19,600  22,100  * 

    John C. Thomas, Jr. 

      7,400  29,600  37,000  * 

    Ben Harshbarger

      3,683  217,400  221,083  1.1%

    Michael D. Price

      4,704  113,333  118,037  * 

    Roger Louis

      1,162  66,740  67,902  * 

    Jeffrey Hackman

      77,018    77,018  * 

    Murray Stewart

            * 

    All current directors and executive officers as a group (10 persons)(4)

      27,419  697,473  724,892  3.6%

    5% Shareholders

                

    Edgepoint Investment Group Inc.(5)

      2,368,819    2,368,819  12.1%

    Broadfin Capital, LLC(6)

      1,229,301  909,296  2,138,597  10.9%

    NB Public Equity K/S(7)

      1,890,525    1,890,525  9.6%

    Whitefort Capital Master Fund, LP(8)

      1,886,230    1,866,230  9.5%

    Healthcare Value Capital, LLC(9)

      1,800,000    1,800,000  9.2%

    Stonepine Capital Management, LLC(10)

      1,155,085    1,155,085  5.9%

    JFL Capital Management LLC(11)

      1,144,554    1,144,554  5.8%

    *
    Represents less than 1%.

    (1)
    The information in the table regarding the beneficial ownership of 5% Shareholders is derived from the System for Electronic Disclosures by Insiders ("SEDI") and the Electronic Data Gathering, Analysis, and Retrieval system ("EDGAR"). Includes all current directors and executive officers of the Company.

    (2)
    Indicates common shares that may be acquired upon exercise of outstanding stock options that are presently exercisable or will be exercisable by the persons named in the table above and by all current directors and executive officers as a group within 60 days of September 13, 2019, as well as common shares that may be acquired on vesting of restricted stock units within 60 days of such date. Amounts take into account the accelerated vesting of outstanding equity awards that will be triggered upon the closing of the Aegerion Recapitalization.

    (3)
    Excludes DSUs, which are issued to directors and are payable only in cash when a director ceases to be a member of the Board. As of September 13, 2019, Dr. Sabba and Mr. Thomas each holds 5,680 vested DSUs.

    (4)
    Includes, in addition to the holdings of our directors and those named executive officers who are current officers of the Company, 570 shares of common shares beneficially owned and 73,266 shares of common shares that may be acquired upon exercise of outstanding stock options that are presently exercisable or will be exercisable within 60 days of September 13, 2019, held by Linda Buono, our Senior Vice President, Human Resources.

    (5)
    The information in the table and this note is derived from a Schedule 13G/A filed with the SEC on February 13, 2019 by EdgePoint Investment Group Inc. and EdgePoint Canadian Portfolio (collectively, "EdgePoint"). Excludes 260,999 and 19,926 shares of common shares issuable upon conversion of the Company's 2.00% Convertible Senior Notes due 2019 (the "Convertible Notes") directly owned by EdgePoint Investment Group Inc. and EdgePoint Canadian Portfolio, respectively. Of the 2,368,819 common shares beneficially owned, EdgePoint Investment Group Inc. reports shared voting power and shared dispositive power as to 2,368,819 shares and EdgePoint Canadian Portfolio reports shared voting power and shared dispositive power as to 1,350,323 shares. The address for EdgePoint is 150 Bloor Street West, Suite 500, Toronto, Ontario M5S 2X9, Canada. The percentage of beneficial ownership has been adjusted to reflect our actual shares of common shares outstanding as of the close of business on September 13, 2019.

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    (6)
    The information in the table and this note is derived from a Form 13F filed with the SEC on February 14, 2019 by Broadfin Capital, LLC and from a Form 4 filed with the SEC on March 15, 2018 by Broadfin Healthcare Master Fund, Ltd. Of the 1,229,301common shares beneficially owned, Broadfin Capital, LLC, Broadfin Healthcare Master Fund, Ltd. and Mr. Kevin Kotler each have shared voting power and shared dispositive power as to 1,229,301 shares. Includes 909,296 warrants issued to Broadfin Healthcare Master Fund Ltd., a private investment fund managed by Broadfin Capital, LLC, of which Mr. Kotler is the managing member (Mr. Kotler disclaims beneficial ownership of the warrants except to the extent of his pecuniary interest therein). The percentage of beneficial ownership has been adjusted to reflect our actual shares of common shares outstanding as of the close of business on September 13, 2019.

    (7)
    The information in the table and this note is derived from a Schedule 13G/A filed with the SEC on December 17, 2018 by NB Public Equity K/S, NB Public Equity Komplementar ApS, Cora Madsen and Florian Schonharting. Of the 1,890,525 common shares beneficially owned, NB Public Equity K/S, NB Public Equity Komplementar ApS, Cora Madsen and Florian Schonharting each report shared voting power and shared dispositive power as to 1,890,525 shares. The address for NB Public Equity K/S is Ostergade 24A, 1, 1100 Copenhagen K, Denmark. The percentage of beneficial ownership has been adjusted to reflect our actual shares of common shares outstanding as of the close of business on September 13, 2019.

    (8)
    The information in the table and this note is derived from a Schedule 13D/A filed with the SEC on June 20, 2019 by Whitefort Capital Master Fund, LP, Whitefort Capital Management, LP, David Salanic and Joseph Kaplan. Of the 1,866,230 common shares beneficially owned, Whitefort Capital Master Fund, LP, Whitefort Capital Management, LP, David Salanic and Joseph Kaplan each report shared voting power and shared dispositive power as to 1,866,230 shares. The address for Whitefort Capital Master Fund, LP is 780 Third Avenue, 26th Floor, New York, New York 10017. The percentage of beneficial ownership has been adjusted to reflect our actual shares of common shares outstanding as of the close of business on September 13, 2019.

    (9)
    The information in the table and this note is derived from a Schedule 13D/A filed with the SEC on December 3, 2018 by Healthcare Value Capital, LLC, Healthcare Value Capital General Partner, LLC, Healthcare Value Partners, L.P. and Joseph P. Riccardo. Of the 1,800,000 common shares beneficially owned, Healthcare Value Capital, LLC, Healthcare Value Capital General Partner, LLC, Healthcare Value Partners, L.P. and Joseph P. Riccardo each report shared voting power and shared dispositive power as to 1,800,000 shares. The address for Healthcare Value Capital, LLC is 50 Tice Blvd, Suite 140, Woodcliff Lake, New Jersey 07677. The percentage of beneficial ownership has been adjusted to reflect our actual shares of common shares outstanding as of the close of business on September 13, 2019.

    (10)
    The information in the table and this note is derived from a Schedule 13G filed with the SEC on August 23, 2019 by Stonepine Capital Management, LLC, Stonepine Capital, L.P., Jon M. Plexico and Timothy P. Lynch. Of the 1,155,085 common shares beneficially owned, Stonepine Capital Management, LLC, Stonepine Capital, L.P., Jon M. Plexico and Timothy P. Lynch have reported shared voting power and shared dispositive power as to 1,155,085 shares. The address for Stonepine Capital Management, LLC is 919 NW Bond Street, Suite 204, Bend, Oregon 97703-2767. The percentage of beneficial ownership has been adjusted to reflect our actual shares of common shares outstanding as of the close of business on September 13, 2019.

    (11)
    The information in the table and this note is derived from a Schedule 13G filed with the SEC on May 31, 2019 by JFL Capital Management LLC. Of the 1,144,554 common shares beneficially owned, JFL Capital management LLC reported shared voting power and shared dispositive power as to 1,144,554 shares. The address for JFL Capital Management LLC is 2110 Ranch Road 620 S, #341732, Lakeway, Texas 78734. The percentage of beneficial ownership has been adjusted to reflect our actual shares of common shares outstanding as of the close of business on September 13, 2019.

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    EXECUTIVE COMPENSATION

    2018 Summary Compensation Table

            The following table summarizes total compensation, for services rendered in all capacities, paid or earned by our named executive officers, as set forth in the table below ("NEOs"), during the fiscal years ended December 31, 2018 and 2017.

    Name and Principal Position
     Year Salary
    ($)
     Bonus
    ($)
     Stock
    Awards
    ($)(1)
     Option
    Awards
    ($)(2)
     Non-
    Equity
    Incentive Plan
    Compensation
    ($)(3)
     All Other
    Compensation
    ($)
     Total
    ($)
     

    Ben Harshbarger,

      2018 $444,000(4)$ $ $85,901 $ $8,970(5)$538,871 

    Interim CEO and General Counsel

      2017  374,673      215,355  141,750  8,100  739,878 

    Michael D. Price,

      
    2018
      
    416,923

    (6)
     
      
      
      
      
    175,630

    (7)
     
    592,553
     

    EVP and Chief Financial Officer

      2017  39,904    79,400  165,580    2,463  287,347 

    Roger Louis,

      
    2018
      
    360,500
      
      
      
    47,723
      
      
    9,243

    (5)
     
    417,466
     

    Global Chief Compliance Officer

      2017  352,313        105,000  8,100  465,413 

    and Interim Head of R&D

                             

    Jeffrey Hackman,

      
    2018
      
    456,683

    (9)
     
      
      
      
      
    8,850

    (5)
     
    465,533
     

    former Interim CEO(8)

      2017  79,385    671,175  262,292    554  1,013,406 

    Murray Stewart,

      
    2018
      
    448,000
      
      
      
    85,901
      
      
    23,455

    (7)
     
    557,356
     

    former EVP, R&D(10)

      2017  53,846    198,500  331,160    7,293  590,799 

    (1)
    This column represents the aggregate grant date fair value of the restricted stock units, calculated in accordance with ASC Topic 718,Compensation — Stock Compensation ("ASC Topic 718"). Such aggregate grant date fair values do not take into account any estimated forfeitures related to service-based vesting conditions. The valuation assumptions used in determining such amounts are described in Note 12 to the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2018. The amounts reflect the accounting cost for the restricted stock units and do not correspond to the actual economic value that may be received by the NEOs upon vesting or settlement of the restricted stock units.

    (2)
    This column represents the aggregate grant date fair value of the stock options, calculated in accordance with ASC Topic 718. Such aggregate grant date fair date values do not take into account any estimated forfeitures related to service-based vesting conditions. The valuation assumptions used in determining such amounts are described in Note 12 to the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2018. The amounts reflect the accounting cost for the stock options and do not correspond to the actual economic value that may be received by the NEOs upon exercise of the stock options or the sale of any underlying common shares.

    (3)
    For 2017, this column represents the cash bonuses earned by the NEOs for the year under our annual cash award plan, based on our achievement of corporate performance goals. For 2018, given the resignations of Mr. Hackman and Dr. Stewart during the fourth quarter of the year, the only NEOs who would have been eligible for annual cash awards attributable to 2018 performance were Mr. Harshbarger, Mr. Price and Mr. Louis. None of these eligible NEOs received 2018 performance-based cash awards as a result of the replacement of the 2018 annual performance-based cash award plan by the Key Executive Incentive Plan in November 2018, discussed below.

    (4)
    Mr. Harshbarger's base salary was increased to $480,000 from $441,000, effective December 1, 2018.

    (5)
    For Mr. Harshbarger and Mr. Hackman, the "All Other Compensation" column for 2018 represents 401(k) plan contributions from the Company and parking allowance. For Mr. Louis, the "All Other Compensation" column for 2018 represents 401(k) plan contributions from the Company, parking allowance and reimbursement for gym membership.

    (6)
    Mr. Price's base salary was increased to $440,000 from $415,000, effective December 1, 2018.

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    (7)
    For Mr. Price and Dr. Stewart, the "All Other Compensation" column for 2018 represents the following:
    Name
     Year Reimbursement for
    Housing and
    Commuting
    Allowance(a)
     401(k) Plan
    Contributions
     Tax Gross-
    Ups for
    Benefits
    Provided to
    NEOs
     Other Total 

    Michael D. Price,

      2018 $95,207 $8,250 $72,173 $ $175,630 

    EVP and Chief Financial Officer

                       

    Murray Stewart,

      2018  5,911  8,250  8,734  560  23,455 

    former EVP, R&D

                       

    (a)
    Represents the following: for Mr. Price, amounts paid to or on behalf of him in connection with temporary housing and commuting in his role as EVP and Chief Financial Officer of the Company; for Dr. Stewart, amounts paid to or on behalf of him in connection with temporary housing and commuting in his former role as EVP, R&D of the Company.
    (8)
    Mr. Hackman was appointed as our Chief Operating Officer on November 1, 2017 and was appointed as our Interim Chief Executive Officer on July 2, 2018. He served in that capacity until November 19, 2018, but remained as an employee of the Company until November 30, 2018. Mr. Hackman did not receive any severance in connection with his resignation.

    (9)
    The amount represents Mr. Hackman's base salary and the cash payment for his unused vacation upon his resignation.

    (10)
    Dr. Stewart was appointed as our EVP, R&D on November 27, 2017. He served in that capacity until October 17, 2018 and did not receive any severance in connection with his resignation.


    Narrative Disclosure to Summary Compensation

    Overview of Our Key 2018 Compensation Elements

            The compensation that our NEOs were initially eligible for in 2018 primarily consisted of annual base salary, annual performance-based cash awards and equity incentives, in the form of stock options. As noted below, for certain of our executive officers, the 2018 annual performance-based cash award plan was replaced by the Key Executive Incentive Plan in November 2018, and therefore no annual performance-based cash awards were made to our current executive officers for 2018 performance. Below is a description of our key NEO compensation elements for 2018.

            Base Salary.    During the first quarter of 2018, as part of our annual performance review cycle, the Compensation Committee approved increases in the base salaries of Mr. Harshbarger, from $420,000 to $441,000, effective January 1, 2018 and Mr. Louis, from $350,000 to $360,500, effective January 1, 2018. The Compensation Committee did not increase the salaries of our other NEOs during this performance cycle given that each of them started employment with us in the fourth quarter of 2017. In addition, in November 2018, the Board and the Compensation Committee approved an increase to Mr. Harshbarger's base salary from $441,000 to $480,000, effective December 1, 2018, in connection with Mr. Harshbarger's promotion to Interim CEO, and an increase to Mr. Price's salary from $415,000 to $440,000, effective December 1, 2018.

            Annual performance-based cash awards.    The Compensation Committee has the authority to award annual performance-based cash awards to our executive officers, including our NEOs (other than our CEO), and to recommend such awards for the CEO to the Board for approval. These awards, if made, would be based upon the level of achievement against pre-established corporate goals. Given the resignations of Mr. Hackman and Dr. Stewart during the fourth quarter of 2018, the only NEOs who would have been eligible for annual cash awards, attributable to 2018 performance, were Mr. Harshbarger, Mr. Price and Mr. Louis. None of these eligible NEOs received 2018 performance-based cash awards as a result of the replacement of the 2018 annual performance-based cash award plan by the Key Executive Incentive Plan in November 2018.

            Key Executive Incentive Plan.    In November 2018, the Board and the Compensation Committee approved a retention plan which was subsequently amended and restated (the "Key Executive Incentive Plan") for certain executive officers, including Mr. Harshbarger, Mr. Price and Mr. Louis. Under the terms of the Key Executive Incentive Plan, participants are entitled to a bonus opportunity, payable in four tranches, based on the levels of achievement by the Company of a cumulative net operating cash flow target (the "NOCF") over the course of three performance periods (which, together, represent 75% of the aggregate payout (the "NOCF Portion")) and the completion of a transaction (the "Transaction Event" and the date on which the Transaction Event occurs,


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    the "Transaction Date") in connection with the Company's review of strategic alternatives (representing 25% of the aggregate payout (the "Transaction Event Portion")) and, together with the NOCF Portion, the ("Total Target Award"), as follows:

    Tranche
    MetricPayoutMeasurement Period
    OneNOCF25% of the NOCF PortionNovember 4, 2018 through February 28, 2019
    TwoNOCF25% of the NOCF Portion*November 4, 2018 through June 30, 2019
    ThreeNOCF50% of the NOCF Portion***November 4, 2018 through the Transaction Date**
    FourTransaction Event100% of the Transaction Event PortionTransaction Date

    *
    New payout opportunity included as part of the March 2019 amendments.

    **
    If the Transaction Date occurs prior to September 30, 2019, then achievement of the NOCF metric shall be determined as of the end of the last completed calendar month preceding the Transaction Date. If the Transaction Date takes place after September 30, 2019, this NOCF period will be extended to the date upon which the Transaction Date occurs and the achievement of the NOCF metric shall be determined as of the end of the last completed calendar month preceding the Transaction Date.

    ***
    March 2019 amendments reduced this tranche to 50% from 75% in light of the new Tranche Two above.

            The NOCF Portion is subject to a minimum level of achievement, at which level the participant would be eligible to receive 50% of the target NOCF Portion, and is capped at a payout of 120% of the target NOCF Portion if the NOCF performance meets or exceeds the maximum performance level (if the minimum level of achievement is not attained, no amount is payable under the NOCF Portion). If performance is between the minimum and target performance levels or the target and maximum performance levels, then the amount of the NOCF Portion shall be determined by linear interpolation.

            The Transaction Event Portion is subject to increase based on an award modifier depending on the type of Transaction Event (if any), and based on the consummation date of such Transaction Event, which modifier could increase the target Transaction Event Portion by a maximum of 25%.

            A participant's right to the Total Target Award will be forfeited upon an employee's voluntary termination prior to the date on which such award is paid. However, in the event of death or disability, termination by the Company without cause or a resignation by the participant with good reason, in each case prior to the applicable payment date, the amounts payable under the Total Target Award will be prorated for the number of completed months the participant was actively employed during the applicable performance period, and measured based upon actual performance at the end of each Measurement Period. Further, if a participant resigns other than for good reason or is terminated for cause, in each case within 90 days following receipt of any portion of the Total Target Award (the "Clawback Period"), the value of all payouts paid to such participant within the Clawback Period (on an after-tax basis) shall be repaid to the Company. For purposes of calculating the prorated payment amount for the second and third NOCF tranches, the number of completed calendar months shall be based on commencement dates of March 1, 2019 and July 1, 2019, respectively.

            Pursuant to the Key Executive Incentive Plan, Mr. Harshbarger is eligible for a Total Target Award of $840,000, Mr. Price is eligible for a Total Target Award of $440,000, and Mr. Louis is eligible for a Total Target Award of $288,400. As part of the March 2019 amendments to the Key Executive Incentive Plan, each of Mr. Harshbarger, Mr. Price and Mr. Louis received his respective first NOCF payment at the target level of payout despite having exceeded the maximum level of achievement as consideration for the additional, incremental payout opportunity at the new June 2019 measurement period. Further, each of Mr. Harshbarger, Mr. Price and Mr. Louis received his respective second NOCF payment at 120% of the target level of payout . It is currently anticipated that each of Mr. Harshbarger, Mr. Price and Mr. Louis will receive his respective third NOCF payment at 120% of the target level of payout and the Transaction Event payment at 105% of the target level of payout upon the closing of the Aegerion Recapitalization, which is expected to occur on [    ·    ], 2019. The March 2019 amendments did not increase any award opportunities (at threshold, target or maximum amounts) or reduce any performance metrics for any participants. Rather, the March 2019 amendments re-allocated the potential payments and adjusted the performance measurement periods in light of the expected timing to complete our review of strategic alternatives.


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            Long-Term Incentive Awards.    We currently maintain one equity compensation plan, the 2017 Equity Incentive Plan (the "Equity Incentive Plan"), under which we may grant time-based stock options, time-based restricted stock units and/or performance-based restricted stock units, as applicable, to directors, officers, including our NEOs, employees and key consultants of the Company and its affiliates.

            In February 2018, as part of annual performance review cycle, we made the following equity awards to our NEOs. Neither Mr. Price nor Mr. Hackman received an equity award as part of the 2018 annual performance cycle given the timing, size and type of equity awards that they received when they joined the Company in November 2017.

    NEOs
    Shares Subject to
    Time-Based
    Stock Option

    Ben Harshbarger

    45,000

    Roger Louis

    25,000

    Murray Stewart

    45,000(1)

    (1)
    The option granted to Dr. Stewart was cancelled in its entirety in connection with his resignation from the Company in October 2018.

    Other Compensation

    Broad-based benefit programs.    We currently maintain broad-based employee benefits that are provided to our NEOs, including health insurance, life and disability insurance, and dental and vision insurance.

            401(k) Plan.    Our U.S.-based employees, including our NEOs, are eligible to participate in our tax-qualified 401(k) plan, which provides participants with an opportunity to save for retirement on a tax-advantaged basis. Our 401(k) plan permits employees to make contributions up to the statutory limit. We have the discretion to match up to 50% of the first 6% of gross wages that an employee contributes, resulting in a maximum match by us that totals up to 3% of an employee's gross wages (as further limited by statutorily defined annual compensation limits). We matched 50% of the first 6% of employee contributions in 2018 (subject to statutory limits).

            Perquisites; Other Benefits.    We provide certain perquisites and personal benefits to our NEOs. See below, in the section entitled "Employment Arrangements with our current NEOs," for a more detailed description of the perquisites and/or personal benefits that we provided in 2018 to our NEOs. In general, we provide each of our NEOs with the Canadian tax support, in order to ensure that they are in a comparable tax position, both in terms of taxes paid and payments for tax services, as they would have been had they not been required to work and pay taxes in Canada. We also provide certain housing and commuting benefits and certain moving expenses to certain of our NEOs who reside outside of the Cambridge, Massachusetts area. In addition, we pay tax-gross ups for certain of these benefits.

    Employment Agreements with our current NEOs

    Compensation Arrangements for Ben Harshbarger, Interim CEO, General Counsel

            We entered into an employment agreement with Mr. Harshbarger, dated November 28, 2016, as amended on August 28, 2017. The employment agreement, as amended, provides for Mr. Harshbarger's initial annual base salary (subject to increase by the Board), initial annual target bonus and eligibility to participate in our health insurance and other benefits, generally. Mr. Harshbarger's current annual base salary is $480,000 and his current annual target bonus is 45% of base salary. We also agreed to reimburse Mr. Harshbarger for incurrence of reasonable expenses for independent tax consultation regarding Canadian tax obligations in connection with service in Canada up to $5,000 on an annual basis, as well as tax equalization payments for Mr. Harshbarger's services in Canada and fees associated with the calculation of such payments. Mr. Harshbarger's employment agreement also includes severance and other benefits that would be paid to Mr. Harshbarger in the event of certain types of termination of employment, as described below. Mr. Harshbarger is subject to the restrictive covenants in the Company's standard Confidentiality, Assignment of Intellectual Property and Non-Competition agreement.


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    Compensation Arrangements for Michael D. Price, EVP, Chief Financial Officer

            We entered into an employment agreement with Mr. Price on December 4, 2017, which was subsequently amended in April 2018 and July 2018. The employment agreement, as amended, provides for Mr. Price's annual base salary (subject to increase by the Board), annual target cash bonus based on achievement of certain performance goals with a target of 50% of his base salary, and eligibility to participate in our health insurance and other benefits, generally. Mr. Price's current base salary is $440,000 and his current annual target bonus is 50% of base salary. Under his original employment agreement, Mr. Price also received (a) a time-based option to purchase 100,000 of our common shares and (b) time-based restricted stock units representing 20,000 of our common shares. Additionally, during the term of his employment, until April 20, 2018, we were obligated to (a) provide Mr. Price with a temporary housing allowance of up to $5,500 per month; and (b) weekly commuting costs not to exceed $1,000, as well as a tax gross-up payment in the amount necessary to offset the tax liability associated with such allowances. Effective April 20, 2018, we are obligated to provide Mr. Price with an aggregate temporary housing and commuting allowance of up to $9,500 per month, as well as a tax gross-up payment in the amount necessary to offset the tax liability associated with such allowances. We also agreed to reimburse Mr. Price for incurrence of reasonable expenses for independent tax consultation regarding Canadian tax obligations in connection with service in Canada up to $5,000 on an annual basis, as well as tax equalization payments for Mr. Price's services in Canada and fees associated with the calculation of such payments. Mr. Price's employment agreement also includes severance and other benefits that would be paid to Mr. Price in the event of certain types of termination of employment, as described below. Mr. Price is subject to the restrictive covenants in the Company's standard Confidentiality, Assignment of Intellectual Property and Non-Competition agreement.

    Compensation Arrangements for Roger Louis, Global Chief Compliance Officer and Interim Head of R&D

            We entered into an employment agreement with Mr. Louis, dated November 28, 2016, as amended August 28, 2017. The employment agreement, as amended, provides for Mr. Louis' initial annual base salary (subject to increase by the Board), initial annual target bonus and eligibility to participate in our health insurance and other benefits, generally. Mr. Louis' current annual base salary is $360,500, and his current annual target bonus is 40% of base salary. We also agreed to reimburse Mr. Louis for incurrence of reasonable expenses for independent tax consultation regarding Canadian tax obligations in connection with service in Canada up to $5,000 on an annual basis, as well as tax equalization payments for Mr. Louis's services in Canada and fees associated with the calculation of such payments. Mr. Louis's employment agreement also includes severance and other benefits that would be paid to Mr. Louis in the event of certain types of termination of employment, as described below. Mr. Louis is subject to the restrictive covenants in the Company's standard Confidentiality, Assignment of Intellectual Property and Non-Competition agreement.

    Termination Arrangements with Messrs. Harshbarger and Louis

      Involuntary Termination of Employment Not in Connection with a Change in Control

            Pursuant to their respective employment agreements, as amended, if the executive is terminated by us for any reason other than "Cause" (as defined in the applicable agreement) death or disability, or the executive resigns for "Good Reason" (as defined in the applicable agreement) then he will be entitled to the following, subject to his execution of a general release of claims in our favor and continued compliance with applicable restrictive covenants: (i) continued base salary for 12 months; and (ii) if he was participating in our group health plan immediately prior to the date of termination and elects COBRA health continuation, we will pay him an amount equal to our share of the premium for the executive's group health coverage, for up to 12 months.

      Involuntary Termination of Employment in Connection with a Change in Control

            In the event of a termination by us for any reason other than Cause, death or disability, or the executive's resignation for Good Reason, in each case within 18 months following a "Sale Event" (as defined in the applicable agreement), he will be entitled to the payments and benefits described above (however, the salary and bonus payments shall be payable in a one-time lump sum cash payment following the termination event), as well as full accelerated vesting of all outstanding equity awards held by him as of the date of such termination, the


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    target bonus for the year of termination and a portion of his target bonus for the year of termination, pro-rated for his employment during such year, in each case subject to his execution of a general release of claims in our favor and continued compliance with applicable restrictive covenants. Although the Liquidation will not give rise to any incremental compensation or benefits on the part of the Mr. Harshbarger and Mr. Louis, the Aegerion Recapitalization qualifies as a Sale Event (or similar term) under applicable agreements, and gives rise to the executive's ability to resign for Good Reason.

            The payments and benefits provided under the employment agreement in connection with a Sale Event may not be eligible for federal income tax deduction for the Company pursuant to Section 280G of the Internal Revenue Code ("Code"). These payments and benefits may also be subject to an excise tax under Section 4999 of the Code. If the payments or benefits payable to the executive in connection with a Sale Event would be subject to the excise tax imposed under Section 4999 of the Code, then those payments or benefits may be reduced, at the discretion of the executive, if such reduction would result in a higher net after-tax benefit to him.

            For purposes of the employment agreements:

            "Cause" generally means (i) his failure (except where due to a disability), neglect or refusal to perform in any material respect his duties and responsibilities; (ii) any act by him that has, or could reasonably be expected to have, the effect of injuring our business in any material respect; (iii) his conviction of, or plea of guilty or no contest to (A) a felony or (B) any other criminal charge that has, or could be reasonably expected to have, an adverse impact on the performance of his duties or otherwise result in material injury to our reputation or business; (iv) his commission of an act of fraud or embezzlement against us, or any other act that creates or reasonably could create negative or adverse publicity for us; (v) any violation by him of our policies, including but not limited to those relating to sexual harassment or business conduct, and those otherwise set forth in our manuals or statements of policy; (vi) his violation of federal or state securities laws; or (vii) his breach of his employment agreement or breach of his confidentiality agreement.

            "Good Reason" generally means that he has complied with the proper notification process following the occurrence of any of the following events (i) a material diminution of his responsibilities, authority or duties; (ii) a material diminution in his base salary except for across-the-board salary reductions applicable to all similarly situated executives; (iii) the relocation of his principal place of employment more than 50 miles from its current location; or (iv) our material breach of his employment agreement.

            "Sale Event" generally means (i) the sale of all or substantially all of our assets on a consolidated basis to an unrelated person or entity; (ii) a merger, reorganization or consolidation pursuant to which the holders of our outstanding voting power immediately prior to such transaction do not own a majority of the outstanding voting power of the resulting or successor entity; (iii) the sale of all of our common shares to an unrelated person or entity; (iv) the acquisition, directly or indirectly, by any person or group of persons acting jointly or in concert (other than us or a person that directly or indirectly controls, is controlled by, or is under common control with, us) of beneficial ownership of securities possessing more than 50% of the total combined voting power of our outstanding securities pursuant to a tender offer (which includes a takeover bid) made directly to our stockholders.

            As confirmed in separate letter agreements with Mr. Harshbarger and Mr. Louis, the Aegerion Recapitalization qualifies as a "Sale Event" under their respective employment agreements. Therefore, following any termination without Cause or resignation for Good Reason, in either case, within eighteen (18) months following the closing of the Aegerion Recapitalization, each of Mr. Harshbarger and Mr. Louis, as applicable, would be entitled (subject to the execution of a release of claims) to the salary continuation and bonus severance benefits as described above under"— Termination Arrangements with Messrs. Harshbarger and Louis — Involuntary Termination of Employment in Connection with a Change in Control", to be paid out in one lump-sum cash payment. Messrs. Harshbarger and Louis are otherwise entitled to all other severance benefits as described in and pursuant to the terms of their employment agreements in connection with any termination without Cause or resignation for Good Reason, in either case.


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    Termination Arrangements with Mr. Price

      Involuntary Termination of Employment Not in Connection with a Change in Control

            Pursuant to his employment agreement, if Mr. Price is terminated by us for any reason other than "Cause" (as defined in his agreement), death or disability or Mr. Price resigns for "Good Reason" (as defined in his agreement), then he will be entitled to the following, subject to execution of a general release of claims in our favor and continued compliance with applicable restrictive covenants: (i) continued base salary for 12 months; (ii) if the Board determines that he is eligible for a target bonus for the year during which his employment terminates, a portion of such target bonus, pro-rated for his employment during such year; and (iii) if Mr. Price was participating in our group health plan immediately prior to the date of termination and elects COBRA health continuation, we will pay him an amount equal to our share of the premium for his group health coverage, for up to 12 months.

      Involuntary Termination of Employment in Connection with a Change in Control

            In the event of a termination by us for any reason other than Cause, death or disability or Mr. Price's resignation for Good Reason, in each case within 18 months following a "Change in Control" (as defined in his agreement), Mr. Price will be entitled to the following (instead of the payments and benefits described above), subject to his execution of a general release of claims in our favor and continued compliance with applicable restrictive covenants: (A) 12 months of base salary (at his then-current rate or base salary in effect immediately prior to the Change in Control, if higher); (B) a portion of his target bonus for the year of termination, pro-rated for his employment during such year; (C) full accelerated vesting of all outstanding equity awards held by him as of the date of such termination; and (D) if he was participating in our group health plan immediately prior to the date of termination and elects COBRA health continuation, we will pay him an amount equal to its share of the premium for his group health coverage, for up to 12 months. The salary and bonus payments shall be payable in a one-time lump sum cash payment following the termination event. Although the Liquidation will not give rise to any incremental compensation or benefits on the part of the Mr. Price, the Aegerion Recapitalization qualifies as a Change in Control (or similar term) under his applicable arrangement, and gives rise to the Mr. Price's ability to resign for Good Reason.

            The payments and benefits provided under the employment agreement in connection with a Change in Control may not be eligible for federal income tax deduction for the Company pursuant to Section 280G of the Code. These payments and benefits may also be subject to an excise tax under Section 4999 of the Code. If the payments or benefits payable to Mr. Price in connection with a Change in Control would be subject to the excise tax imposed under Section 4999 of the Code, then those payments or benefits may be reduced, at the discretion of Mr. Price if such reduction would result in a higher net after-tax benefit to him.

            For purposes of Mr. Price's employment agreement:

            "Cause" generally means (i) his conduct constituting a material act of misconduct in connection with the performance of his duties; (ii) a material and willful misrepresentation by him to our CEO or the Board regarding a matter of material importance to us; (iii) his commission of any felony or misdemeanor involving moral turpitude, deceit, dishonesty or fraud, or any conduct by him that would reasonably be expected to result in material injury or reputational harm to us or any of our subsidiaries and affiliates if he were retained in his position; (iv) his continued non-performance of his duties hereunder with a cure period and standard carve-outs; (v) his breach of any of the provisions contained in section 7 of his employment agreement; (vi) his material violation of our written employment policies; (vii) his failure to cooperate with a bona fide internal investigation or an investigation by regulatory or law enforcement authorities, after being instructed by us to cooperate, or the willful destruction or failure to preserve documents or other materials known to be relevant to such investigation or the inducement of others to fail to cooperate or to produce documents or other materials in connection with such investigation.

            "Change in Control" generally means any of the following (i) any person becomes the beneficial owner, directly or indirectly, of our securities representation 50 percent or more of the combined voting power of our then-outstanding securities having the right to vote in an election of the Board, as such terms are used in the Exchange Act, as amended; (ii) the date a majority of the members of the board is replaced during any 12-month


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    period by directors whose appointment or election is not endorsed by a majority of the members of the board before the date of the appointment or elects; or (iii) the consummation of (A) any consolidation or merger of us where our shareholders, immediately prior to the consolidation or merger, would not, immediately after the consolidation or merger, beneficially own, directly or indirectly, shares representing in the aggregate more than 50 percent of the voting shares of the company issuing cash or securities in the consolidation or merger, or (B) any sale or other transfer of all or substantially all of our assets.

            "Good Reason" generally means that he has complied with the proper notification process following the occurrence of any of the following events (i) a material diminution of his responsibilities, authority or duties; (ii) a material diminution in his base salary except for across-the-board salary reductions based on our financial performance similarly affecting all or substantially all our senior management employees; (iii) a material change in the geographic location at which he provides services to us; or (iv) our material breach of his employment agreement.

            As confirmed in a letter agreement with Mr. Price, the Aegerion Recapitalization qualifies as a "Change in Control" under his employment agreement. Therefore, following any termination without Cause or resignation for Good Reason, in either case, within eighteen (18) months following the closing of the Aegerion Recapitalization, Mr. Price would be entitled (subject to a release of claims) to the salary continuation and bonus severance benefits as described above under"— Termination Arrangements with Mr. Price — Involuntary Termination of Employment in Connection with a Change in Control", to be paid out in one lump-sum cash payment. Mr. Price is otherwise entitled to all other severance benefits as described in and pursuant to the terms of his employment agreement in connection with any termination without Cause or resignation for Good Reason, in either case.

    Vesting of Outstanding Equity Awards

            All remaining vesting of any outstanding awards for all participants under the Amended and Restated Novelion 2017 Equity Incentive Plan and the Aegerion Pharmaceuticals, Inc. 2010 Stock Option and Incentive Plan will accelerate immediately prior to the closing of the Aegerion Recapitalization.


    Outstanding Equity Awards at 2018 Fiscal Year-End

            The following table provides information regarding equity awards held by our NEOs as of December 31, 2018. Dr. Stewart is not included in the following table because he did not hold any equity awards as of December 31, 2018, due to his resignation in 2018.

     
     Options Awards(1) Stock Awards(1) 
    Name
     Number of Securities
    Underlying
    Unexercised
    Options (#)
    Exercisable
     Number of Securities
    Underlying
    Unexercised
    Options (#)
    Unexercisable
     Option
    Exercise
    Price ($)
     Option
    Expiration
    Date
     Number of
    Shares or Units
    of Stock That
    Have Not
    Vested (#)
     Market Value of
    Shares or Units of
    Stock That Have
    Not Vested ($)(2)
     

    Ben Harshbarger

      64,933(3) 32,467(3)$8.65  12/22/2026  348(4)$292 

      25,000(5) 50,000(5) 7.03  10/6/2027  374(6) 314 

        45,000(7) 4.44  2/12/2028     

    Michael D. Price

      33,333(8) 66,667(8) 3.97  11/27/2027  13,333(9) 11,200 

    Roger Louis

      27,827(3) 13,913(3) 8.65  12/22/2026  546(4) 459 

        25,000(7) 4.44  2/12/2028     

    Jeffrey Hackman

      45,000(10)   4.71  2/28/2019(10) (11)  

    (1)
    Pursuant to the NEOs' employment agreements, such equity awards are subject to certain acceleration of vesting provisions in the event of certain qualifying terminations in connection with a change in control, as discussed further in "Employment Agreements with our current NEOs" above.

    (2)
    Based on the closing price of our common shares on December 31, 2018 ($0.84), the last trading date of 2018.

    (3)
    Represents time-based stock options granted on December 22, 2016 under the Equity Incentive Plan, which vest ratably on an annual basis over three years from the grant date, subject to continued employment through each applicable vesting date.

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    (4)
    Represents time-based restricted stock units granted on May 9, 2016 under the Aegerion Pharmaceuticals, Inc. 2010 Stock Option and Incentive Plan ("Aegerion 2010 Plan"), which vest ratably on an annual basis over three years from the grant date, subject to continued employment through each applicable vesting date.

    (5)
    Represents time-based stock options granted on October 6, 2017 under the Equity Incentive Plan, which vest ratably on an annual basis over three years from the grant date, subject to continued employment through each applicable vesting date.

    (6)
    Represents time-based restricted stock units granted on May 9, 2016 under the Aegerion 2010 Plan, 25% of which vest on the first anniversary of the grant date, 50% of which vest on the second anniversary grant date, and 25% of which vest on the third anniversary grant date, subject to continued employment through each applicable vesting date.

    (7)
    Represents time-based stock options granted on February 12, 2018 under the Equity Incentive Plan, which vest ratably on an annual basis over three years from the grant date, subject to continued employment through each applicable vesting date.

    (8)
    Represents time-based stock options granted on November 27, 2017 under the Equity Incentive Plan, which vest ratably on an annual basis over three years from the grant date, subject to continued employment through each applicable vesting date.

    (9)
    Represents time-based restricted stock units granted on November 27, 2017 under the Equity Incentive Plan, which vest ratably on an annual basis over three years from the grant date, subject to continued employment through each applicable vesting date.

    (10)
    Represents time-based stock options granted on November 1, 2017 under the Equity Incentive Plan, which vest ratably on an annual basis over three years from the grant date. The remaining unvested time-based stock options were cancelled upon Mr. Hackman's resignation from the Company. All the vested stock options expired on February 28, 2019, 90 days after Mr. Hackman's termination date.

    (11)
    In connection with Mr. Hackman's appointment as the former Chief Operating Officer of the Company, on November 1, 2017, he was granted (1) 50,000 shares of time-based restricted stock units under the Equity Incentive Plan, of which, 16,667 shares were vested on November 1, 2018; and (2) 92,500 shares of time-based restricted stock units under the Equity Incentive Plan, of which 100% was vested on November 1, 2018. The remaining unvested time-based restricted stock units were cancelled upon Mr. Hackman's resignation from the Company.


    SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

            We currently maintain the Equity Incentive Plan, pursuant to which directors, officers, employees and consultants of Novelion and its affiliates may be granted restricted stock units and stock options to acquire common shares, as well as a 2017 Employee Stock Purchase Plan (the "ESPP"), pursuant to which our eligible employees may use payroll deductions to purchase our common shares at a discount. Our ESPP program is currently suspended.

            The following table sets out information as of December 31, 2018 with respect to our common shares that may be issued under our existing equity compensation plans.

    Plan Category
     Number of securities to be
    issued upon exercise of
    outstanding options,
    warrants and rights
    (a)
     Weighted-average
    exercise price of
    outstanding options,
    warrants and rights
    (b)
     Number of securities remaining
    available for future issuance under
    equity compensation plans (excluding
    securities reflected in column (a))
    (c)
     

    Equity compensation plans approved by security holders

      2,239,485(1)$5.63(2) 2,250,137(3)

    Equity compensation plans not approved by security holders

           

    Total

      2,239,485 $5.63  2,250,137 

    (1)
    Reflects securities (both shares underlying stock options and restricted stock units) from the Aegerion 2010 Plan (16,832 shares) and the Equity Incentive Plan (2,222,653 shares).

    (2)
    Represents the weighted-average exercise price of outstanding stock options only, as there are no exercise prices associated with the restricted stock units.

    (3)
    Reflects available securities for future issuance from the Equity Incentive Plan. The Company no longer issues any equity awards under the Aegerion 2010 Plan.

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    PROPOSAL NO. 4: ADVISORY COMPENSATION PROPOSAL

    Background

            Section 14A of the Exchange Act requires that we provide our shareholders with the opportunity to vote to approve, on a non-binding, advisory basis, not less frequently than once every three years, the compensation of our NEOs as disclosed in our annual proxy statement in accordance with the compensation disclosure rules of the SEC.

            We seek to align the interests of our NEOs with those of our shareholders. Our compensation philosophy is to provide a compensation package that attracts, retains and motivates executives and rewards business successes that have the potential to increase shareholder value. More specifically, our executive compensation programs are designed to:

      attract, retain, and motivate executives with significant industry knowledge and the experience and leadership capability necessary for our corporate success;

      align incentives for our executive officers with our short-term and long-term corporate strategies and business objectives and goals; and

      drive the achievement of key strategic performance measures aligned to the long-term interests of our shareholders.

            The vote on this resolution is not intended to address any specific element of compensation but rather the overall compensation of our NEOs described in this Proxy Statement. The vote is advisory, which means that the vote is not binding on Novelion, our Board or the Compensation Committee. Although non-binding, the Board and the Compensation Committee value the opinions that shareholders express in their votes and will review the voting results and take them into consideration as they deem appropriate if and when making future decisions regarding our executive compensation program.


    Vote Required and Board of Directors' Recommendation

            The advisory vote to approve the compensation of our NEOs, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the SEC, requires the affirmative vote of a majority of the votes cast by, or on behalf of, the shareholders of the Company entitled to vote present in person or by proxy voting at the Annual Meeting, on an advisory basis.

            The following resolution will be submitted for a shareholder vote at the Annual Meeting:

        "BE IT RESOLVED that the shareholders of Novelion Therapeutics Inc. approve, on an advisory basis, the compensation of Novelion's NEOs, as disclosed in Novelion Therapeutics Inc.'s proxy statement for the 2019 annual general meeting of shareholders pursuant to the compensation disclosure rules of the SEC."

    The Board of Directors unanimously recommends that our shareholders vote "FOR" the Advisory Compensation Proposal.


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    INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS

            No current or former directors, executive officers or employees of Novelion or any subsidiaries thereof, or proposed nominees for election as a director of Novelion, are currently indebted to Novelion or its subsidiaries.


    REPORT OF THE AUDIT COMMITTEE

            The information contained in this Audit Committee report shall not be deemed to be (1) "soliciting material," (2) "filed" with the SEC, (3) subject to Regulations 14A or 14C of the Exchange Act, or (4) subject to the liabilities of Section 18 of the Exchange Act. No portion of this Audit Committee report shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, through any general statement incorporating by reference in its entirety the proxy statement in which this report appears, except to the extent that Novelion specifically incorporates this report or a portion of it by reference. In addition, this report shall not be deemed filed under either the Securities Act or the Exchange Act.

            This report is submitted by the Audit Committee of the Board. None of the members of the Audit Committee is an officer or employee of Novelion, and the Board has determined that each member of the Audit Committee is "independent" for Audit Committee purposes as that term is defined under Rule 10A-3 of the Exchange Act and applicable Nasdaq rules. Each member of the Audit Committee meets the requirements for financial literacy under the applicable rules and regulations of the SEC and Nasdaq. The Board has designated Mr. Thomas as an "audit committee financial expert," as defined under the applicable rules of the SEC. The Audit Committee operates under a written charter adopted by the Board.

            The Audit Committee has reviewed and discussed the audited consolidated financial statements for the year ended December 31, 2018 with the management of Novelion and Deloitte & Touche LLP, our independent registered public accounting firm for the 2018 fiscal year.

            The Audit Committee has discussed with Deloitte & Touche LLP the matters required to be discussed by Statement on Auditing Standards No. 61, as amended (AICPA Performance Standards Vol. 1. AU Section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T. In addition, the Audit Committee has received the written disclosures and the letter from Deloitte & Touche LLP required by applicable requirements of the Public Company Accounting Oversight Board regarding their independence, and has discussed with Deloitte & Touche LLP their independence relative to us, including whether the provision of their services is compatible with maintaining Deloitte & Touche LLP's independence.

            Based on the review and discussions referred to above, the Audit Committee recommended to Novelion's Board that the audited consolidated financial statements for the year ended December 31, 2018 be included in Novelion's Annual Report on Form 10-K (as amended) for 2018 filed with the SEC.

    John C. Thomas, Jr., Chair
    Mark Corrigan
    Stephen Sabba

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    PROPOSAL NO. 5: APPROVAL OF APPOINTMENT OF INDEPENDENT REGISTERED
    PUBLIC ACCOUNTING FIRM

            Deloitte & Touche LLP, an independent registered public accounting firm, served as our independent registered public accounting firm for the year ended December 31, 2018. Deloitte LLP, an independent registered public accounting firm, served as our independent registered public accounting firm from 1981 through fiscal year 2016. On April 11, 2017, in recognition of the fact that the financial operations and management team of Novelion had transitioned to be primarily located in the U.S. following the merger of QLT (KNA Novelion) and Aegerion, Deloitte LLP resigned as our independent registered public accounting firm, and Deloitte & Touche LLP was appointed as the successor independent registered public accounting firm. The decision to change the certifying accountant was approved by the Audit Committee and ratified by our shareholders at the 2017 Annual Meeting.

            As a matter of good corporate governance, the Board determined to submit to stockholders for approval the appointment of Deloitte & Touche LLP. Our shareholders are being asked to approve this proposal at the Annual Meeting. Novelion has been advised that a representative of Deloitte & Touche LLP will attend the Annual Meeting and will have the opportunity to make a statement if he or she decides to do so and will be available to respond to appropriate questions from shareholders.


    Fees Paid for Services

            The following table sets forth the aggregate fees billed by Deloitte & Touche LLP ("Deloitte U.S."), and Deloitte LLP, the other member firms of Deloitte Touche Tohmatsu, and their respective affiliates (collectively, "Deloitte Canada") for the following services during 2018 and 2017. All fees incurred for fiscal year 2018 were billed by Deloitte U.S.

     
      
     2017 (US$) 
    Description of Service
     2018 (US$) Deloitte U.S. Deloitte
    Canada
     Total 

    Audit Fees(1)

     $1,301,950 $1,281,350 $8,560 $1,289,910 

    Audit-Related Fees

             

    Tax Fees (Tax compliance, tax advice and planning)

      198,000  74,996    74,996 

    All Other Fees

      556,165(2) 669,043(2) 40,928(3) 709,971 

    Total Fees

     $2,056,115 $2,025,389 $49,488 $2,074,877 

    (1)
    For 2018, "Audit Fees" consist of fees for the audit of Novelion's annual financial statements and reviews of quarterly financial statements. For 2017, "Audit Fees" consist of fees for the integrated audit of Novelion's annual financial statements, reviews of quarterly financial statements, audits of internal controls over financial reporting, and Deloitte Canada's issuance of consent in connection with the 2017 audited consolidated financial statements.

    (2)
    For 2018 and 2017, "All Other Fees" billed by Deloitte U.S. consist of fees related to document production and related services in connection with the U.S. Department of Justice and SEC investigations of Aegerion. Although Deloitte U.S. was engaged by our outside legal counsel for the document production and related services, fees are paid directly by the Company to Deloitte U.S. The "All Other Fees" billed by Deloitte U.S. also include an annual subscription to Deloitte U.S.' technical accounting research tool.

    (3)
    For 2017, "All Other Fees" billed by Deloitte Canada consist of fees related to services in connection with the filing with the SEC of certain Registration Statements on Form S-8.


    Pre-Approval Policies and Procedures

            The charter of the Audit Committee provides that the Audit Committee is responsible for the pre-approval of all audit and permitted non-audit services to be performed for Novelion by the independent auditors. The fees paid to the independent registered public accounting firm that are shown in the chart above for 2018 and 2017 were approved by the Audit Committee in accordance with the procedures described below.

            The Audit Committee reviews and approves audit and non-audit services proposed to be provided by the independent registered public accounting firm. The Audit Committee has delegated to its Chair, or an alternate member of the Audit Committee, the authority to grant pre-approvals if either deems it necessary or appropriate


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    to consider a pre-approval request without approval and/or meeting of the full Audit Committee. Pre-approvals by the Chair of the Audit Committee or an alternate member are reviewed with the Audit Committee at its next regularly scheduled meeting.

            In considering the pre-approval of proposed audit or non-audit services by the independent registered public accounting firm, management reviews with the Audit Committee or its delegate a description of and the budget for the proposed service and the reasons that the independent registered public accounting firm are being requested to provide the services, including any possible impact on the independence of the independent registered public accounting firm. Additional Audit Committee approval is required if the pre-approved services exceed the pre-approved budgeted amount for the services.


    Vote Required and Board of Directors' Recommendation

            This proposal requires the affirmative vote of a majority of the votes cast by, or on behalf of, the shareholders of the Company entitled to vote present in person or by proxy voting at the Annual Meeting. If the proposal is not approved, the BCBCA provides that the current auditors, Deloitte & Touche LLP, will continue to act for Novelion until such time as the shareholders approve alternate auditors.

            The following resolution will be submitted for a shareholder vote at the Annual Meeting:

        "BE IT RESOLVED that Deloitte & Touche LLP, an independent registered public accounting firm, be appointed as independent auditors of Novelion Therapeutics Inc. for the ensuing year, and the Audit Committee of the Board of Directors of Novelion Therapeutics Inc. be authorized to fix the remuneration to be paid to the auditors."

    The Board of Directors unanimously recommends that our shareholders vote "FOR" the proposal to appoint Deloitte & Touche LLP as our independent auditors for 2019 at a remuneration to be fixed by the Audit Committee of the Board of Directors.


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    TRANSACTIONS WITH RELATED PERSONS

            Except as disclosed in this Proxy Statement, none of the directors, director nominees, executive officers, persons who have been directors or executive officers at any time since the beginning of QLT'sNovelion's last completed fiscal year, or any beneficial owner of more than 5% of the outstanding common shares of QLTNovelion or any associate or affiliate of such person, had any material interest, direct or indirect, in any transaction or proceeding during the past fiscal year or in any proposed transaction or pending proceeding which has materially affected or will materially affect QLTNovelion or its subsidiaries.subsidiaries or which would require disclosure under Item 404(a) of Regulation S-K. In the event that a director is determined to have any material interest, direct or indirect, in any transaction or proceeding or in any proposed transaction or pending proceeding of QLT,Novelion, only those directors not having a material interest would be permitted to consider and evaluate any such transaction or any agreements relating to that transaction, or any actions to be undertaken by QLTNovelion relating to such proceeding.

            QLTOn March 15, 2018, Aegerion entered into a loan and security agreement with affiliates of Broadfin Capital, LLC ("Broadfin Capital") and Sarissa Capital Management LP ("Sarissa Capital") (the "Shareholder Term Loan Agreement"), pursuant to which the lenders made a single-draw term loan to Aegerion in an aggregate amount of $20.0 million (the "Shareholder Term Loans"). In connection with the Shareholder Term Loan Agreement, the lenders of the Shareholder Term Loans were issued warrants ("Shareholder Term Loan Warrants") to purchase approximately 1.8 million Novelion common shares. The Shareholder Term Loan Warrants have an exercise price equal to $4.40 per share, representing the volume weighted average price of Novelion common shares for the 20 trading days ended March 14, 2018. The terms of the Shareholder Term Loan Agreement, which were approved by our Audit Committee and by a special committee of disinterested directors and our full Board (with conflicted members recused), can be found in our Current Report on Form 8-K filed with the SEC on March 15, 2018.

            At the time of the Shareholder Term Loans and based on publicly available information, Broadfin Capital beneficially owned, or had control or direction over, directly or indirectly, 1,948,554 common shares of Novelion (excluding the Shareholder Term Loan Warrants), or approximately 10.45% of the outstanding common shares of Novelion at the time. Further, at the time of the Shareholder Term Loans, Mr. Kevin Kotler was a non-employee director of Novelion, and is the founder and general partner of Broadfin Capital, the general partner of Broadfin Healthcare Master Fund, Ltd. Mr. Kotler, Broadfin Capital and Broadfin Healthcare Master Fund, Ltd. were each deemed to be beneficial owners of the 1,948,554 shares. Mr. Kotler was designated to the Board by Broadfin Capital.

            At the time of the Shareholder Term Loans and based on publicly available information, Sarissa Capital beneficially owned, or had control or direction over, directly or indirectly, 1,025,000 common shares of Novelion (excluding the Shareholder Term Loan Warrants), or approximately 5.55% of the outstanding common shares of Novelion at the time. Further, at the time of the Shareholder Term Loans, Mr. Mark DiPaolo was a non-employee director of Novelion and is the general counsel of Sarissa Capital. Mr. DiPaolo was appointed to the Board by Sarissa Capital in accordance with the requirements of our agreement with Sarissa Capital, as set forth in the merger agreement by which we acquired Aegerion, which provided Sarissa Capital with the right to appoint an additional director by providing written notice to the Company within a defined period of time of the 2017 Annual Meeting.

            The Shareholder Term Loans were subsequently repaid in connection with Aegerion's entry into a bridge credit agreement on November 8, 2018 with certain funds managed by Highbridge Capital Management, LLC and Athyrium Capital Management, LP, as lenders (the "Bridge Lenders"), under which Aegerion borrowed new secured first lien term loans in cash in an original aggregate principal amount of $50.0 million ("New Money Loans") and $22.5 million of new secured term loans that were funded, on behalf of Aegerion, to repurchase and retire an equal amount of Aegerion's outstanding Convertible Notes, at par, held by certain funds managed by the Bridge Lenders (the "Roll Up Loans"). On November 8, 2018, in addition to the repurchase and cancellation of certain Aegerion's outstanding Convertible Notes with the proceeds of the Roll Up Loans, Aegerion used proceeds of the New Money Loans to repay, at par, (a) the amounts outstanding under the Shareholder Term Loan Agreement, in an aggregate principal amount of approximately $21.2 million, and (b) principal under Aegerion's secured term loan owed to Novelion in an amount of $3.5 million. The Shareholder Term Loan Warrants remain outstanding.


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            Novelion has entered into indemnity agreements with our directors and all other officers of Novelion which provide, among other things, that, subject to any requirements that may exist under the BCBCA or the Articles of QLT, QLTNovelion, Novelion will indemnify such officer or director, under the circumstances and to the extent specified, for expenses, damages, judgments, fines and settlements he or she may be required to pay in actions or proceedings to which he or she is or may be made a party by reason of his or her position as a director or officer of QLT.Novelion.


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    AUDITED CONSOLIDATED FINANCIAL STATEMENTS
    AND ADDITIONAL INFORMATION

            A copy of our Annual Report on Form 10-K for the fiscal year ended December 31, 2014 was previously mailed to all registered and beneficial shareholders of QLT. The Audited Consolidated Financial Statements of QLTNovelion for its most recently completed fiscal year ended December 31, 2014,2018, together with the Auditors' Report thereon, which are included in our Annual Report for Canadian regulatory purposes, will be presented at the Annual General Meeting scheduled to be held on January 8, 2016.Meeting. Copies of the Audited Consolidated Financial Statements, including management discussionManagement's Discussion and analysis,Analysis, are available on our website atwww.qltinc.comwww.novelion.com or upon request directly to QLTNovelion to the attention of "QLT"Novelion Investor Relations," 887 Great Northern Way, Suite 250,c/o Norton Rose Fulbright, 1800 — 510 West Georgia Street, Vancouver, British Columbia, Canada V5T 4T5 (Phone: 604-707-7000; Fax: 604-707-7001;V6B 0M3; e-mail:ir@qltinc.cominvestors@novelion.com).

            You may read        In light of the developments with Novelion and copy any document QLT files at the SEC's Public Reference Room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You may obtain informationAegerion subsequent to December 31, 2018, including those matters described herein, investors are cautioned not to place undue reliance on the operationAnnual Report and are encouraged to read all of the Public Reference Room by calling the SEC at 1-800-SEC-0330. QLT's SECNovelion's subsequent reports and filings, are also available to the public at the SEC's website atincluding this Proxy Statement in its entirety.

    www.sec.gov.        Additional information relating to QLTNovelion has been filed and is available on SEDAR atwww.sedar.com and from the SEC's website atwww.sec.gov.


    DOCUMENTS INCORPORATED BY REFERENCESECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

            The applicableSection 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers and directors and beneficial owners of more than ten percent of a registered class of our equity securities laws allow QLT to "incorporate by reference" documents into this Proxy Statement which are filed on SEDAR (www.sedar.com). The following information incorporated by reference into this Proxy Statement is considered to be a partfile reports of this Proxy Statement:

      QLT's Annual Reportownership on Form 10-K for the fiscal year ended December 31, 2014, filed3 and changes in ownership on Form 4 or 5 with the SEC. Such executive officers, directors and 10% beneficial owners are also required by SEC rules to furnish us with copies of all Section 16(a) reports they file.

        Delinquent Section 16(a) Reports

              We are required to disclose herein any late filings of such reports. To our knowledge, based solely on February 26, 2015, as amended on April 30, 2015.

      Aralez Pharmaceutical Inc.'s registration statement on Form S-4 declared effectivea review of copies of reports filed by the SEC on December 28, 2015reporting persons furnished to us, or written representations from reporting persons, we believe that all reporting persons timely complied with all applicable filing requirements, except that Forms 4 were not timely filed by Mr. Harshbarger in respect of shares that were withheld to satisfy tax obligations upon vesting of certain of his restricted stock units. The withholdings occurred during May and September of 2018, but the Form 4 was not filed on SEDAR on January     •    , 2016 (the "Aralez Registration Statement"); and

      The management information circular of Tribute Pharmaceuticals Canada Inc. ("Tribute") prepared for the special meeting of Tribute shareholders to be held on February 1, 2016 (the "Tribute Circular") filed as exhibit 99.1 to the current report on Form 8K by Tribute on January     •    , 2016, and filed on SEDAR on January     •    , 2016.

            The Aralez Registration Statement and Tribute Circular are available on SEDAR under Tribute's profile at www.sedar.com. QLT undertakes to provide without charge to each person to whom a copy of this proxy statement has been delivered, upon request, by first class mail or other equally prompt means, within one business day of receipt of the request, a copy of any or all of the documents incorporated by reference into this proxy statement, other than the exhibits to these documents, unless the exhibits are specifically incorporated by reference into the information that this proxy statement incorporates.

            You should direct any requests for documents to QLT's headquarters at QLT Inc., Attention: Investor Relations, 887 Great Northern Way, Suite 250, British Columbia, Canada V5T 4T5, telephone: (604) 707-7000.

            Document requests from QLT should be made by February 4, 2016 in order to receive them before the Special Meeting.


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    OTHER BUSINESS

            The Board is not awareInstrument of Proxy confers upon the proxy holder discretionary authority to vote all shares represented by the proxy with respect to amendments or variations to matters identified in the Notice of Meeting and any other matter that willproperly comes before the Annual Meeting. We know of no such amendment, variation or other matter that is to be presented for action at the SpecialAnnual Meeting. IfHowever, if any other matters which are not now known to us should properly come before the SpecialAnnual Meeting, both the Interim Chief Executive Officer andproxies will be voted, or not voted, by the Chairman ofproxy holder in his or her discretion, whether or not the Board intend to voteamendment, variation or other matter that comes before the common shares represented by proxy for which either of themAnnual Meeting is appointed in accordance with their best judgment on such matters.contested.

    BY ORDER OF THE BOARD OF DIRECTORS OF QLTNOVELION THERAPEUTICS INC.

    GRAPHIC



    Dr. Geoffrey F. Cox
    Interim Chief Executive Officer

    Ben Harshbarger
    Interim Chief Executive Officer & General Counsel

    (This page has been left blank intentionally.)


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    APPENDIX "A"

    PLAN OF ARRANGEMENT
    Schedule A


    Dated                            
    QLT INC.
    PLAN OF ARRANGEMENT UNDER
    SECTIONS 288 TO 299 OF THE BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA)

    ARTICLE 1
    INTERPRETATION

    1.1   Definitions

            In this Plan of Arrangement:

    (a)
    "Aralez" means Aralez Pharmaceuticals Inc., a company existing under the laws of British Columbia

    (b)
    "Aralez Cash Consideration" means the price per Aralez Share which QLT is contractually entitled to receive pursuant to the terms and conditions of a backstop agreement dated June 8, 2015 and amended December 7, 2015 entered into among QLT, Broadfin Healthcare Master Fund Ltd., JW Partners, LP and JW Opportunities Master Fund Ltd, as such agreement may be further amended or supplemented from time to time.

    (c)
    "Aralez Cash Election Notice" means the notice of election given by a QLT Shareholder in accordance with Section 2.2 pursuant to which a QLT Shareholder may elect to receive Aralez Cash Consideration in lieu of Aralez Shares, subject to proration in accordance with Section 2.3.

    (d)
    "Aralez Closing" means the acquisition by QLT of a minimum of 6,250,000 Aralez Shares and a maximum of 7,200,000 Aralez Shares or such other number of Aralez Shares acquired by QLT pursuant to the terms and conditions of an amended and restated share subscription agreement dated December 7, 2015, entered into among Aralez Pharmaceuticals Inc., Aralez Pharmaceuticals Plc, Tribute Pharmaceuticals Canada Inc., Pozen Inc., QLT and certain other parties, as such agreement may be further amended or supplemented from time to time.

    (e)
    "Aralez Shares" means common shares of Aralez.

    (f)
    "Aralez Share Exchange Ratio" means the number, rounded down to the nearest five decimal places, that is equal to the quotient obtained by dividing the number of Aralez Shares acquired by QLT pursuant to the Aralez Closing by the number of QLT Shares issued and outstanding on the Record Date.

    (g)
    "Arrangement" means an arrangement under Sections 288 to 299 of the Business Corporations Act on the terms and conditions set forth in this Plan of Arrangement.

    (h)
    "Board" means the board of directors of QLT.

    (i)
    "Business Corporations Act" means the Business Corporations Act, S.B.C. 2002, c. 57, as amended.

    (j)
    "Business Day" means any day which is not a Saturday, Sunday or a day on which banks are not open for business in the relevant place.

    (k)
    "Computershare" means, together, Computershare Investor Services Inc., QLT's registrar and transfer agent, and its affiliate Computershare Trust Company of Canada, a trust company.

    (l)
    "Court" means the Supreme Court of British Columbia.

    (m)
    "Effective Date" means the date on which the last of all necessary documents to effect the Plan of Arrangement have been filed with the Registrar.

    (n)
    "Election Deadline" means 5:00 p.m. (Pacific standard time) on the date established by QLT as the date by which each QLT Shareholder wishing to make an election as out in Section 2.2(a) must deposit with Computershare its duly completed Aralez Cash Election Notice in accordance with Section 2.2.

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    (o)
    "holder" means, when used with reference to any QLT Shares, the holder of such QLT Shares, as shown from time to time on the register of shareholders maintained by Computershare on behalf of QLT.

    (p)
    "ITA" means theIncome Tax Act·    (Canada).

    (q)
    "Maximum Cash" means $15,000,000.

    (r)
    "Plan of Arrangement" means this plan of arrangement, proposed under Sections 288 to 299 of the Business Corporations Act, as amended and supplemented from time to time in accordance herewith and any order of the Court.

    (s)
    "QLT" means QLT Inc., a company incorporated under the laws of British Columbia.

    2019
    (t)
    "QLT Class A Common Shares" has the meaning set out in Section 2.1(a).

    (u)
    "QLT Deferred Share Unit" means a deferred share unit issued pursuant to the QLT Deferred Share Unit Plan, each of which is converted only into cash and has a value equal to the market price of QLT Shares.

    (v)
    "QLT Deferred Share Unit Plan" means the QLT Directors' Deferred Share Unit Plan.

    (w)
    "QLT Meeting" means the special meeting of QLT Shareholders and any adjournment thereof to be held to consider and, if deemed advisable, approve the Arrangement.

    (x)
    "QLT Option" means an incentive stock option of QLT issued pursuant to the QLT Option Plan which is exercisable to acquire QLT Shares.

    (y)
    "QLT Option Plan" means the QLT 2000 Incentive Stock Plan as amended and restated on April 25, 2013.

    (z)
    "QLT Proxy Statement" means the notice of the QLT Meeting and the accompanying proxy statement, including all schedules thereto, to be sent to the QLT Shareholders and others in connection with the QLT Meeting, together with any amendments or supplements thereto.

    (aa)
    "QLT Restricted Stock Unit" means a restricted stock unit of QLT issued pursuant to the QLT Option Plan which entitles the holder, upon vesting, to acquire QLT Shares.

    (bb)
    "QLT Securityholders" means, collectively, QLT Shareholders, holders of QLT Options, holders of QLT Deferred Share Units and holders of QLT Restricted Stock Units;

    (cc)
    "QLT Shareholders" means the registered holders of QLT Shares as of the Record Date.

    (dd)
    "QLT Shares" means the common shares in the authorized share structure of QLT as constituted prior to the Effective Date, and from and after the Effective Date, it means QLT Class A Common Shares.

    (ee)
    "Registrar" means the Registrar of Companies appointed under Section 400 of the Business Corporations Act.

    (ff)
    "Record Date" means the date established by QLT for the purpose of determining the QLT Shareholders entitled to receive any of, or all of, the QLT Class A Common Shares and Aralez Shares (or Aralez Cash Consideration fully or partially in lieu thereof) under the Arrangement.

    (gg)
    "Replacement Deferred Share Unit" has the meaning set out Section 2.1(h).

    (hh)
    "Replacement Deferred Share Unit Plan" means the plan adopted by QLT pursuant to which the Replacement Deferred Share Units will be issued, which plan will have the same terms and conditions as the QLT Deferred Share Unit Plan except that any references to QLT Shares in such plan will be deemed to be to QLT Class A Common Shares.

    (ii)
    "Replacement Option" has the meaning set out Section 2.1(f).

    (jj)
    "Replacement Option Plan" means the plan adopted by QLT pursuant to which the Replacement Options and Replacement Restricted Stock Units will be issued, which plan will have the same terms and conditions as the QLT Option Plan except that any references to QLT Shares in such plan will be deemed to be to QLT Class A Common Shares.

    (kk)
    "Replacement Restricted Stock Unit" has the meaning set out Section 2.1(g).

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    (ll)
    "Total Elected Cash" has the meaning set out Section 2.3.

    1.2   Headings and References

            The division of this Plan of Arrangement into Articles and sections and the insertion of headings are for convenience of reference only and do not affect the construction or interpretation of this Plan of Arrangement. Unless otherwise specified, references to sections are to sections of this Plan of Arrangement.

    1.3   Number, etc.

            Unless the context otherwise requires, words importing the singular number only will include the plural and vice versa; words importing the use of any gender will include all genders; and words importing persons will include firms and corporations and vice versa.

    1.4   Construction

            In this Plan of Arrangement unless otherwise indicated:

    (a)
    the words "include", "including" or "in particular", when following any general term or statement, will not be construed as limiting the general term or statement to the specific items or matters set forth or to similar items or matters, but rather as permitting the general term or statement to refer to all other items or matters that could reasonably fall within the broadest possible scope of the general term or statement;

    (b)
    a reference to a statute means that statute, as amended and in effect as of the date of this Plan of Arrangement, and includes each and every regulation and rule made thereunder and in effect as of the date hereof;

    (c)
    where a word, term or phrase is defined, its derivatives or other grammatical forms have a corresponding meaning; and

    (d)
    time is of the essence.

    1.5   Currency

            Currency amounts are expressed in United States dollars.


    ARTICLE 2
    THE ARRANGEMENT

    2.1   The Arrangement

            On the Effective Date, subject to the provisions of Section 4.1, the following will occur and will be deemed to occur in the following order without any further authorization, act or formality:

    (a)
    QLT's authorized share structure, its Notice of Articles and Articles will be altered by:

    (i)
    creating 500,000,000 Class A common shares (the "QLT Class A Common Shares"); and

    (ii)
    creating and attaching to the QLT Class A Common Shares the special rights and restrictions set out in Exhibit I, which will be contained in Part 26 of the Articles;

    (b)
    each issued and outstanding QLT Share will be and be deemed to be exchanged for the following:

    (i)
    one QLT Class A Common Share; and

    (ii)
    such number of Aralez Shares as is equal to the Aralez Share Exchange Ratio or, in lieu of such Aralez Shares, the Aralez Cash Consideration if QLT has received the Aralez Cash Consideration and such holder has so elected in accordance with Section 2.2, subject to proration in accordance with Section 2.3;

      and all QLT Shares will be cancelled and will form part of the authorized but unissued share capital of QLT and no QLT Shares will remain outstanding;


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    (c)
    QLT's authorized share structure, its Notice of Articles and Articles will be altered by:

    (i)
    reducing the authorized capital by eliminating the authorized and unissued QLT Shares;

    (ii)
    deleting the special rights and restrictions attached to the QLT Class A Common Shares and by deleting Part 26 of the Articles of QLT in its entirety; and

    (iii)
    altering the identifying name of all of the QLT Class A Common Shares to be "common shares";

    (d)
    the QLT Option Plan will be cancelled and will have no further force or effect and the Replacement Option Plan will be deemed to be adopted by QLT and in effect;

    (e)
    the QLT Deferred Share Unit Plan will be cancelled and will have no further force or effect and the Replacement Deferred Share Unit Plan will be deemed to be adopted by QLT and in effect;

    (f)
    each outstanding QLT Option will be deemed to be exchanged for a stock option (a "Replacement Option") on the same terms and conditions as the QLT Stock Option so exchanged except that such Replacement Option will be exercisable to acquire a QLT Class A Common Share and will be issued pursuant to, and governed by the terms of, the Replacement Option Plan;

    (g)
    each outstanding QLT Restricted Stock Unit will be deemed to be exchanged for a restricted stock unit (a "Replacement Restricted Stock Unit") on the same terms and conditions as the QLT Restricted Stock Unit so exchanged except that such Replacement Restricted Stock Unit will entitle the holder, upon vesting, to acquire a QLT Class A Common Share and will be issued pursuant to, and governed by the terms of, the Replacement Option Plan; and

    (h)
    each outstanding QLT Deferred Share Unit will be deemed to be exchanged for a deferred share unit (a "Replacement Deferred Share Unit") on the same terms and conditions as the QLT Deferred Share Unit so exchanged except that the value of such Replacement Deferred Share Unit will be equal to the value of a QLT Class A Common Share and will be issued pursuant to, and governed by the terms of, the Replacement Deferred Share Unit Plan.

    2.2   Aralez Cash Election

            With respect to the distribution of Aralez Shares effected pursuant to Section 2.1(b)(ii):

    (a)
    each QLT Shareholder may elect to receive, in respect of each Aralez Share distributable to such QLT Shareholder pursuant to this Plan of Arrangement, the Aralez Cash Consideration, subject to proration in accordance with Section 2.4;

    (b)
    the election provided for in Section 2.2(a) will be made by each QLT Shareholder by depositing with Computershare, prior to the Election Deadline, a duly completed Aralez Cash Election Notice;

    (c)
    any Aralez Cash Election Notice, once deposited with Computershare, will be irrevocable and may not be withdrawn by a QLT Shareholder;

    (d)
    any QLT Shareholder who does not deposit with Computershare a duly completed Aralez Cash Election Notice prior to the Election Deadline will be deemed to have elected to receive Aralez Shares in respect of all of such holder's QLT Shares; and

    (e)
    notwithstanding Section 2.3 and any other contrary provision herein, in the event QLT does not receive the Aralez Cash Consideration, QLT Shareholders will not be entitled to receive the Aralez Cash Consideration.

    2.3   Proration

            Subject to Section 2.2, the maximum amount of cash that may, in the aggregate, be paid to the QLT Shareholders pursuant to Section 2.1(b)(ii) will be equal to the Maximum Cash. In the event that the aggregate amount of cash that would, but for this Section 2.3, be paid to QLT Shareholders in accordance with the elections of such QLT Shareholders pursuant to Section 2.2 (the "Total Elected Cash"), exceeds the Maximum Cash, then the aggregate amount of cash to be paid to any QLT Shareholder will be determined by multiplying


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    the aggregate amount of elected cash that would, but for this Section 2.3, be paid to such QLT Shareholder by a fraction, rounded down to five decimal places, the numerator of which is the Maximum Cash and the denominator of which is the Total Elected Cash. As a result, such holder: (i) will be deemed to have elected to receive cash for such number of Aralez Shares, rounded down to the nearest whole Aralez Share, as is equal to the amount of cash received divided by the Aralez Cash Consideration, and (ii) will receive Aralez Shares for the remainder of such holder's election entitlement for which, but for this Section 2.3, such holder would have received cash.

    2.4   Entitlement to Cash Consideration

            In any case where the aggregate cash consideration payable to a particular QLT Shareholder under this Arrangement would, but for this Section 2.4, include a fraction of a cent, the consideration payable will be rounded down to the nearest whole cent.

    2.5   No Fractional Aralez Shares

            No certificates representing fractional Aralez Shares will be issued under the Arrangement and no Aralez Cash Consideration will be paid in respect of fractional Aralez Shares. Where the aggregate number of Aralez Shares to be issued under the Arrangement would result in a fraction of an Aralez Share being issuable to a QLT Shareholder, the number of Aralez Shares to be received by such QLT Shareholder will be rounded down to the nearest whole Aralez Share and no QLT Shareholder will be entitled to any compensation in respect of a fractional Aralez Share.

    2.6   Existing Certificates to Govern

    (a)
    The QLT Class A Common Shares to be issued pursuant to Section 2.1(b)(i) will be evidenced by the existing share certificates representing the QLT Shares, and no share certificates representing such QLT Class A Common Shares will be issued to the QLT Shareholders.

    (b)
    The Replacement Options to be issued pursuant to Section 2.1(f) will be evidenced by the existing stock option certificates representing the QLT Options, and no stock option certificates representing such Replacement Options will be issued under the Replacement Option Plan.

    (c)
    The Replacement Restricted Stock Units to be issued pursuant to Section 2.1(g) will be evidenced by the existing restricted stock unit certificates representing the QLT Restricted Stock Units, and no restricted stock unit certificates representing such Replacement Restricted Stock Units will be issued under the Replacement Option Plan.

    (d)
    The Replacement Deferred Share Units to be issued pursuant to Section 2.1(h) will be evidenced by the existing deferred share unit certificates representing the QLT Deferred Share Units, and no deferred share unit certificates representing such Replacement Deferred Share Units will be issued under the Replacement Deferred Share Unit Plan.


    ARTICLE 3
    DELIVERY OF SECURITIES AND CASH

    3.1   Distribution of Aralez Share Certificates and Cash

            As soon as practicable following the Effective Date, QLT will cause Computershare to deliver to the QLT Shareholders as of the Record Date in accordance with the terms hereof, share certificates representing the Aralez Shares, the Aralez Cash Consideration and all other consideration to which such QLT Shareholders are entitled following the Arrangement.

    3.2   Withholding and Sale Rights

            Each of QLT and Computershare will be entitled to deduct and withhold from (i) any Aralez Shares, Aralez Cash Consideration or other consideration otherwise issuable or payable pursuant to this Plan of Arrangement to any holder of QLT Shares, or (ii) any dividend or consideration otherwise payable to any holder of QLT


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    Shares such amounts as QLT or Computershare, respectively, is required to deduct and withhold with respect to such issuance or payment, as the case may be, under the ITA, the U.S. Internal Revenue Code or any provision of provincial, state, local or foreign tax law, in each case as amended. To the extent that the amount so required to be deducted or withheld from the Aralez Shares, dividends or consideration otherwise issuable or payable to a holder exceeds the cash portion of the consideration otherwise payable to such holder, each of QLT and Computershare is hereby authorized to sell or otherwise dispose of, at such times and at such prices as it determines, in its sole discretion, such portion of the Aralez Shares otherwise issuable or payable to such holder as is necessary to provide sufficient funds to QLT and Computershare, as the case may be, to enable it to comply with such deduction or withholding requirement, and will notify the holder thereof and remit to such holder any unapplied balance of the net proceeds of such sale or disposition (after deducting applicable sale commissions and any other reasonable expenses relating thereto) in lieu of the Aralez Shares or other consideration so sold or disposed of. To the extent that amounts are so withheld or Aralez Shares or other consideration are so sold or disposed of, such withheld amounts, or shares or other consideration so sold or disposed of, will be treated for all purposes as having been paid to the holder of the shares in respect of which such deduction, withholding, sale or disposition was made, provided that such withheld amounts, or the net proceeds of such sale or disposition, as the case may be, are actually remitted to the appropriate taxing authority. Neither QLT nor Computershare will be obligated to seek or obtain a minimum price for any of the Aralez Shares or other consideration sold or disposed of by it hereunder, nor will either of them be liable for any loss arising out of any such sale or disposition.


    ARTICLE 4
    MISCELLANEOUS PROVISIONS

    4.1   Amendment of the Plan of Arrangement

    (a)
    QLT reserves the right to amend, modify or supplement this Plan of Arrangement at any time and from time to time prior to the Effective Date, provided that each such amendment, modification or supplement must be (i) set out in writing, (ii) approved by the Board, (iii) filed with the Court and, (iv) if made following the Meeting, approved by the Court, and communicated to the QLT Securityholders if and as required by the Court.

    (b)
    Any amendment, modification or supplement to this Plan of Arrangement that is approved by the Court following the Meeting shall be effective only if:

    (i)
    it is approved by the Board; and

    (ii)
    if required by the Court, it is consented to by the QLT Shareholders voting in the manner directed by the Court.

    (c)
    Any amendment, modification or supplement to this Plan of Arrangement may be made following the Effective Date unilaterally by QLT, provided that it concerns a matter which, in the reasonable opinion of QLT, is of an administrative nature required to better give effect to the implementation of this Plan of Arrangement and is not adverse to the financial or economic interests of any former QLT Securityholders.

    4.2   Arrangement Effectiveness

            The Arrangement will become final and conclusively binding on the QLT Securityholders and QLT on the Effective Date.

    4.3   Supplementary Actions

            Notwithstanding that the transactions and events set out in Section 2.1 will occur and will be deemed to occur in the chronological order therein set out without any act or formality, QLT will make, do, execute and deliver, or cause and procure to be made, done, executed and delivered all such further acts, deeds, agreements, transfers, assurances, instruments or documents as may be required to give effect to this Plan of Arrangement, including, without limitation, any resolution of the Board authorizing the issue or transfer of shares, any share transfer powers evidencing the transfer of shares and any receipt therefor, and any necessary additions to or deletions from share registers.




    Table of ContentsNOVELION THERAPEUTICS INC.

    PLAN OF LIQUIDATION AND
    EXHIBIT I

    SPECIAL RIGHTS AND RESTRICTIONS
    ATTACHING TO THE CLASS A COMMON SHARES
    DISTRIBUTION

    Dividends

            The holders of the Class A Common Shares will, in the absolute discretion of the directors, be entitled to receive and the Company will pay out of monies of the Company properly applicable to the payment of dividends, such dividends as may be declared from time to time in respect of the Class A Common Shares. Notwithstanding any other provision of these Articles, the directors will not declare a dividend on the First Preference Shares or the Common Shares without declaring an identical dividend on the Class A Common Shares.


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    APPENDIX "B"NOVELION THERAPEUTICS INC.

    INTERIM ORDERPLAN OF LIQUIDATION AND DISTRIBUTION

    No.


    Vancouver Registry

    IN THE SUPREME COURT OF BRITISH COLUMBIA

    BETWEEN:

    QLT INC.

    PETITIONER

    RE: IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING QLT INC. AND ITS SECURITYHOLDERS PURSUANT TO SECTIONS 288 TO 299 OF THE        WHEREAS the board of directors (theBUSINESS CORPORATIONS ACTBoard) of Novelion Therapeutics Inc. (Novelion (BRITISH COLUMBIA), S.B.C. 2002, c. 57, AS AMENDEDor the

    ORDER MADE AFTER APPLICATIONCompany

    )), the

    BEFORE

    )MASTER)day of

    ))•, 2016

    ON THE APPLICATION) has concluded that it is in the best interests of the Petitioner, QLT Inc.

          ýwithout notice, coming on for hearing at 800 Smithe Street, Vancouver, British Columbia on    •    , the    •    day of    •    , 2016 and on hearing counsel for the Petitioner, Carey Veinotte;

    THIS COURT ORDERS that:

    1.
    The Petitioner, QLT Inc. (the "Petitioner" or "QLT"), be permitted to convene, hold and conduct a special meeting of its registered holders of common shares (the "QLT Shareholders")Company to be held at 10:00 a.m. (Pacific Standard Time) on    •    , 2016 in Vancouver, British Columbia at the offices of QLT at 1800-510 West Georgia Street, Vancouver, British Columbia (the "Meeting").

    2.
    At the Meeting, QLT Shareholders will considerliquidated voluntarily and if deemed advisable, pass, with or without variation, a special resolution (the "Arrangement Resolution"), authorizing, approvingwound up and agreeingdissolved pursuant to adopt a plan of arrangement (the "Plan of Arrangement") among the Petitioner and the QLT Securityholders (the "Arrangement") as described in the Plan of Arrangement attached as part of Exhibit "B" to the Affidavit of    •    , sworn on     •    , 2016.

    3.
    The Meeting shall be called, held and conducted in accordance with the provisions of theBusiness Corporations Act (British Columbia), S.B.C. 2002, c. 27 (the "BCBCA"), as amended and the Articles of QLT, in each case subject toaccordance with the terms of this Interim OrderLiquidation Plan (as defined below);

            AND WHEREAS the Board has passed a resolution authorizing the Company to seek shareholder approval for the liquidation, winding up and dissolution of the Company and hold a special meeting of shareholders to consider and vote to direct the Company to be liquidated voluntarily, wound up and dissolved and, in connection therewith, approve this Liquidation Plan and the appointment of the Liquidator;

            NOW THEREFORE THIS Liquidation Plan is approved by the Board as of the last date set forth below, having the terms and conditions as set out herein.


    Article 1
    INTERPRETATION

    1.1   Definitions

            In this Liquidation Plan:

    Aegerion Parties means Aegerion Pharmaceuticals, Inc. and Aegerion Pharmaceuticals Holdings, Inc.;

    Assets means all of the property, assets, undertaking and the proceeds thereof of Novelion;

    Board has the meaning given to it in the recitals of this Liquidation Plan;

    Business Day means a day, other than a Saturday or Sunday, on which banks are generally open for business in Vancouver, British Columbia;

    Calendar Day means any day, including a Saturday, Sunday or statutory holiday in Vancouver, British Columbia;

    BCBCA means theBusiness Corporations Act (British Columbia);

    Claim means

      (a)
      any right of any Person against Novelion in connection with any indebtedness, liability or obligation of any kind of Novelion and any further Orderinterest accrued thereon or costs payable in respect thereof, whether liquidated, unliquidated, reduced to judgment, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, unsecured, present, future, known or unknown, by guarantee, surety or otherwise, and whether or not such right is executory or anticipatory in nature, including any claim made or asserted against Novelion through any affiliate, associate or any right or ability of any Person to advance a claim for contribution or indemnity or otherwise, in each case, with respect to any matter, action, cause or chose in action, whether existing at present or commenced in the Court.

      4.
      The following information (collectively the "Meeting Materials"):

      (a)
      the Notice of Special Meeting of Shareholders;future; and

      (b)
      any existing or future right of any Person against any one or more of the Proxy Statement;

      Directors or Officers which arose or arises as a result of such Director's or Officer's position, supervision, management or involvement as a Director or Officer of Novelion whether such right, or the circumstances giving rise to it, arose before or after the Effective Date and whether enforceable in any civil, administrative or criminal proceeding;

    Claims Bar Date means the date on which a Claim must be filed pursuant to the Claims Process;

    Claims Process means the process established by the Liquidator and approved by the Court for the identification, resolution and barring of Claims;

    Clearance Certificates means:

      (c)(a)
      a certificate issued pursuant to subsection 159(2) of the Interim Order;Income Tax Act, R.S.C. 1985, c.1 (5th Supp.) as amended (theITA), and

      (d)
      the Requisition any provincial equivalent thereof, certifying that all amounts for Final Hearing,which

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        in substantiallyNovelion is, or can reasonably be expected to become, liable under the same form annexedITA and relevant provincial legislation, as Exhibit "B" of the Affidavit of    •    , sworn on    •    , 2016, with such amendmentsapplicable, up to and inclusions thereto as counsel for the Petitioner may advise are necessary or desirable, provided that such amendments and inclusions are not inconsistent with the terms of this Order, shall be mailed by prepaid ordinary mail or sent by facsimile or other electronic transmission:

        (a)
        to the QLT Shareholders at their registered address as they appear on the books of the Petitioner at the close of business on January 4, 2016, being the record date for the determination of QLT Shareholders entitled to notice of the Meeting; and

        (b)
        to the directors and auditors of the Petitioner.

        which mailing shall occur at least twenty-one (21) days prior toincluding the date of the Meeting, excludingfirst distribution to Shareholders, have been paid, or that security for payment has been accepted;

      (b)
      a certificate issued pursuant to subsection 23(5) of the date of mailingCanada Pension Plan, R.S.C. 1985, c. C-8 (theCPP), or any equivalent thereof, certifying that all amounts for which Novelion is liable under the CPP up to and excludingincluding the date of the Meeting,first distribution to Shareholders, have been paid or that security for the payment thereof has been accepted;

      (c)
      a certificate issued pursuant to subsection 86(3) of theEmployment Insurance Act, S.C. 1996, c. 23 (theEIA), or any equivalent thereof, certifying the payment, or acceptance of security for payment, of all amounts for which Novelion is liable under the EIA up to and that service of the Meeting Materials as herein described, shall constitute good and sufficient service of such Notice of the Special Meeting of Shareholders and Notice of the Petition for a Final Order, upon all who may wish to appear in these proceedings, and no other service need be made, and such service shall be effective on the fifth day after the said Meeting Materials are mailed or, if sent by facsimile or other electronic transmission, on the date of said transmission.

    5.
    The Meeting Materials be mailed by prepaid ordinary mail or sent by facsimile or other electronic transmission to the holders of options and other rights to acquire securities of the Petitioner, to the extent that the holders of such rights are not already QLT Shareholders, which mailing shall occur at least twenty-one (21) days prior toincluding the date of the Meeting, excludingfirst distribution to Shareholders;

    (d)
    a certificate issued pursuant to subsection 81(1) of the dateExcise Tax Act, R.S.C. 1985, c. E-15 (theETA), or any equivalent thereof, certifying that, as of mailing and excluding the date of the Meeting, and that servicefirst distribution to Shareholders, no tax, penalty, interest or other sum under the ETA, chargeable against or payable by the Liquidator or chargeable against or payable in respect of the Meeting Materials as herein described shall constitute good and sufficient service of such Notice of Meeting and NoticeAssets or the Company, remains unpaid or that security for the payment thereof has, in accordance with section 80.1 of the ApplicationETA, been accepted;

    (e)
    a certificate issued pursuant to subsection 270(3) of the ETA, or any equivalent thereof, certifying that all amounts payable or remittable under Part IX of the ETA by Novelion in respect of the reporting period during which the first distribution to Shareholders is made or any previous reporting period, and all amounts that are, or can reasonably be expected to become, payable or remittable under Part IX of the ETA by the Liquidator or the Company in respect of the reporting period during which the distribution is made or any previous reporting period, has been paid or that security for a Final Order upon all such personsthe payment thereof has been accepted; and no other service need be made, and such service shall be effective on the fifth day after the said Meeting Materials are mailed or, if sent by facsimile or other electronic transmission, on the date of said transmission.

    6.(f)
    The accidental omission to give the Notice of the Meeting or Notice of the Application for a Final Order to, or the non-receipt of such notices by, one or more of the persons specified herein, shall not invalidate any resolution passed or proceedings taken at the Meeting.

    7.
    The Chair of the Meeting (the "Chair") shall be an officer or director of the Petitioner or such other personsimilar certificate as may be appointed by the QLT Shareholders for that purpose.

    8.
    The Chair is at libertyrequired pursuant to call on the assistance ofany legal counsel to the Petitioner at any time and from time to time, as the Chair may deem necessary or appropriate during the Meeting, and such legal counsel is entitled to attend the Meeting for this purpose.

    requirement.
    9.
    The Meeting may be adjourned or postponed for any reason upon the approval of the Chair, and if the Meeting is adjourned or postponed, it shall be reconvened or held at a place and time to be designated by the Chair.

    10.
    The quorum required at the Meeting shall be the quorum required by the Articles of the Petitioner.

    11.
    The vote of QLT shareholders required to adopt the Arrangement Resolution at the Meeting shall be the affirmative vote of two-thirds of

    Common Shares means the common shares cast by QLT Shareholders who vote in person or by proxy on the Arrangement Resolution.

    12.
    The Chair or Secretarycapital of Novelion;

    Company has the Meeting shall,meaning given to it in due course, file with the Court Affidavit(s) verifying the actions taken and the decisions reached by the QLT Shareholders at the Meeting with respect to the Arrangement.

    13.
    The only persons entitled to notice of or vote at the Meeting or any adjournment(s) or postponement(s) thereof either in person or by proxy shall be the QLT Shareholders as at the close of business on January 4, 2016 and the directors and auditors of the Petitioner.

    14.
    The Petitioner be at liberty to give noticerecitals of this application to persons outside the jurisdiction of this Honourable Court in the manner specified herein.

    Table of ContentsLiquidation Plan;

    15.
    Unless the directors of the Petitioner by resolution determine to abandon the Arrangement, the Application for the Final Order (the "Final Application") be set down for hearing before the presiding Judge in Chambers at the Courthouse at 800 Smithe Street, Vancouver, British Columbia, on    •    , 2016 at 9:45 a.m., or such other date following the date of the Meeting as the Petitioner may determine, and that, upon approval of the Arrangement Resolution at the Meeting in the manner set forth in this Interim Order, the Petitioner be at liberty to proceed with the Final Application on that date.

    16.
    Any QLT Shareholder and any holder of any other right to acquire a security of the Petitioner may appear at the Final Application provided that such person shall file a Response to the Petition filed herein, in the form prescribed by the Rules of

    Court of means the Supreme Court of British Columbia,Columbia;

    Creditor means any Person with a Claim;

    Directors means all individuals who were, on or at any time before the Effective Date, directors of Novelion, includingde facto directors, and deliver a copythe term "Director" shall mean any one of them;

    Dissolution Date means the date on which the winding up of the filed Response, together withCompany is completed upon its dissolution pursuant to the BCBCA;

    Effective Date means the date to be established by a copyresolution of all material onthe Board upon which such person intends to rely at the Final Application, including an outlineimplementation of such person's proposed submissions, to counselthe Liquidation Plan shall commence, which date shall be the date established as the date for commencement of the Petitioner at its address for delivery as set outliquidation and winding up in the Petition, on or before 4:00 p.m. at least seven (7) days priorstatement of intent to liquidate that is filed by the date of the Hearing of the Final Application, or as the Court may otherwise direct.

    17.
    SubjectCompany pursuant to other provisions in this Order no material other than that contained in the Meeting Materials need be served on any persons in respect of these proceedings.

    18.
    If the Final Application is adjourned, only those persons who have filed and delivered a Response in accordance with this Interim Order needthe BCBCA.

    Employees means the employees of Novelion;

    Governmental Authority means any nation or government, any province, state or other political subdivision thereof, any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to be servedgovernment or any Legal Requirement and provided with noticeany corporation or other entity owned or controlled, through capital stock or otherwise by any of the adjourned date.

    19.
    The provisions of Rule 8-1 (apart from the requirement for an Application Record) and 16-1 be hereby dispensed with for the purposesforegoing;

    Legal Requirement means any statute, law, treaty, rule, regulation, order, decree, writ, injunction or determination of any further applicationarbitrator, court, Governmental Authority or securities exchange and, with respect to be made pursuant to this Petition.

    20.
    The Petitioner andany Person, includes all such Legal Requirements applicable or binding upon such Person, its business or the QLT Shareholders, directors and auditors shall, and hereby do, have liberty to apply for such further Orders as may be appropriate.

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    APPENDIX "C"

    REQUISITION FOR FINAL HEARING

    No.


    Vancouver Registry

    IN THE SUPREME COURT OF BRITISH COLUMBIA

    BETWEEN:

    QLT INC.

    PETITIONER

    RE: IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING QLT INC. AND ITS SECURITYHOLDERS PURSUANT TO SECTIONS 288 TO 299 OF THEBUSINESS CORPORATIONS ACT (BRITISH COLUMBIA), S.B.C. 2002, c. 57, AS AMENDED

    REQUISITION — GENERAL

    Filed by:        The Petitioner, QLT Inc. ("QLT")

    Required:

    To re-set the Hearing of the Petition to    •    , 2016 at 9:45 a.m. before the presiding Judge in Chambers at the Courthouse at 800 Smithe Street, Vancouver, British Columbia, for a final order (the "Final Order") approving an arrangement (the "Arrangement") under section 291 of theBusiness Corporations Act (British Columbia), S.B.C. 2002, c. 57, as amended, described in the Plan of Arrangement, which is attached as Schedule "A" to the draft form of the Final Order which is attached as Exhibit "A" to this Requisition.

    Please take notice that by an Interim Order of the Supreme Court of British Columbia, pronounced on,    •    , 2016, the Court has given directions as to the calling of a special meeting of the shareholders of the Petitioner for the purpose of voting upon a special resolution to approve the Arrangement.

    At the Hearing of the Application for the Final Order (the "Final Application"), any shareholder of the Petitioner, directorownership or auditor of the Petitioner, or any other interested party with leave of the Court, desiring to support or oppose the Final Application may, after filing a Response and related materials as outlined in the Interim Order and further herein, appear for that purpose, either in person or by counsel. If you do not attend, either in person or by counsel, at that time, the Court may approve the Arrangement as presented, or may approve it subject to such terms and conditions as the Court shall deem fit, without any further notice to you.

    If you wish to appear at the Final Application or wish to be notifieduse of any further proceedings, YOU MUST GIVE NOTICE of your intention by filing a Response to Petition with the Court at the Court Registry at 800 Smithe Street, Vancouver, British Columbia, and YOU MUST ALSO DELIVER a copy of the filed Response, together with a copy of all material on which you intend to rely at the Final Application, if any, to counsel for the Petitioner at their address for delivery set out below by 4:00 p.m. (Pacific Standard Time) on    •    , 2016or at a later date with leave of the Court.

    The Petitioner's address for delivery is:its assets;

    Taylor Veinotte Sullivan, Barristers
    Suite 300 – 1168 Hamilton Street
    Vancouver, BC V6B 2S2
    Telephone: (604) 687-7007

    Attention: Carey Veinotte

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    YouLiquidation Plan means this plan of liquidation and distribution as it may be amended, supplemented, restated or your counselotherwise modified in accordance with its terms;

    Liquidator means the Person appointed from time to time pursuant to Sections 4.1, 4.5, or 4.6 in its capacity as liquidator of Novelion;

    Minister means the Minister of National Revenue;

    NASDAQ means the NASDAQ Global Select Market;

    Novelion has the meaning given to it in the recitals of this Liquidation Plan;

    Officers means all individuals who were, on or at any time before the Effective Date, officers of Novelion, includingde facto officers, and the term "Officer" shall mean any one of them;

    Person means any individual, partnership, limited partnership, joint venture, trust, corporation, unincorporated organization, government, agency, regulatory body or instrumentality thereof, legal personal representative or litigation guardian, or any other judicial entity howsoever designated or constituted domiciled;

    Proven Claim means a Claim finally accepted in accordance with the provisions of the Claims Process;

    Resolution means the special resolution of the Shareholders authorizing the voluntary liquidation, winding up and dissolution of Novelion made in accordance with the BCBCA and approving this Liquidation Plan and the ordinary resolution of Shareholders authorizing the appointment of the Liquidator;

    Shareholder Approval Date means the date on which the shareholders of the Company pass the Resolution;

    Shareholders means all holders of Common Shares shown on the Effective Date in the registers maintained by or on behalf of Novelion by the Transfer Agent in respect of the Common Shares;

    Shared Services Agreements means the shared services agreements entered into among Novelion, Novelion Services USA, Inc. and Aegerion Pharmaceuticals, Inc. dated December 1, 2016, as amended May 20 2019;

    Tax Return means any report, return or other information required to be supplied to a taxing authority in connection with (a) all taxes, charges, fees, levies and other assessments (whether federal, provincial, local or foreign), including income, gross receipts, excise, property, sales, use, transfer, license, payroll, franchise, withholding, social security and unemployment taxes, and (b) any interest, penalties and additions related to the foregoing; and

    Transfer Agent means Computershare Investor Services Inc., as transfer agent for the Common Shares of the Company.

    1.2   Certain Rules of Interpretation

            In this Liquidation Plan and the Schedules hereto:

      (a)
      all references to currency are to Canadian Dollars, except as otherwise expressly indicated;

      (b)
      the division of this Liquidation Plan into articles, sections, subsections and clauses and the insertion of headings and a table of contents are for convenience of reference only and shall not affect the construction or interpretation of this Liquidation Plan. The terms "this Liquidation Plan", "hereof', "hereunder", "herein" and similar expressions refer to this Liquidation Plan and not to any particular article, section, subsection or clause and include any plan supplemental hereto. Unless otherwise indicated, any reference in this Liquidation Plan to an article, section, subsection, clause or schedule refers to the specified article, section, subsection, clause or schedule of or to this Liquidation Plan;

      (c)
      the use of words in the singular or plural, or with a particular gender, shall not limit the scope or exclude the application of any provision of this Liquidation Plan or a schedule hereto to such Person (or Persons) or circumstances as the context otherwise permits;

      (d)
      the words "includes" and "including" and similar terms of inclusion shall not, unless expressly modified by the words "only" or "solely", be construed as terms of limitation, but rather shall mean "includes

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        without limitation" and "including without limitation", so that references to included matters shall be regarded as illustrative without being either characterizing or exhaustive;

      (e)
      unless otherwise specified, all references to time herein and in any document issued pursuant hereto mean local time in Vancouver, British Columbia and any reference to an event occurring on a Business Day shall mean prior to 5:00 p.m., on such Business Day. Unless otherwise specified, the time period within or following which any payment is to be made or act is to be done shall be calculated by excluding the day on which the period commences and including the day on which the period ends and by extending the period to the next succeeding Business Day if the last day of the period is not a Business Day. Whenever any payment to be made or action to be taken under this Liquidation Plan is required to be made or to be taken on a day other than a Business Day, such payment shall be made or action taken on the next succeeding Business Day;

      (f)
      unless otherwise specified, where any reference to an event occurring within any number of "days" appears in this Liquidation Plan, such reference means Calendar Days and not Business Days; and

      (g)
      unless otherwise provided, any reference to a statute, or other enactment of parliament or a legislature includes all regulations made thereunder, all enactments to or re-enactments of such statute or regulations in force from time to time, and, if applicable, any statute or regulation that supplements or supersedes such statute or regulation.


    Article 2
    PURPOSE OF THE PLAN

    2.1   Purpose

            The purpose of this Liquidation Plan is to provide for a plan of liquidation, winding up and distribution of the Assets, payment or settlement of all Claims and dissolution of the Company.

    2.2   Commencement of Liquidation, Winding Up and Dissolution

            The voluntary liquidation, winding up and dissolution of the Company shall commence on and as of the Effective Date.

    2.3   Affected Persons

            This Liquidation Plan will be implemented under the BCBCA and, as of the Effective Date will be binding on the Company, the Directors, the Liquidator, the Shareholders, beneficial holders of shares of the Company, and any other holder of a Claim in accordance with its terms. On the Shareholder Approval Date, each Shareholder and beneficial holder of shares of the Company (whether or not such holder voted in respect of the Liquidation Plan), and each holder of a Claim shall be deemed to have consented and agreed to all of the provisions of this Liquidation Plan in its and their entirety.


    Article 3
    EFFECT OF PLAN

    3.1   Share Transfers

            The Company will request, in accordance with any Court order directing same, that the Transfer Agent refrain from making any changes to the registers maintained by the Transfer Agent in respect of the Common Shares, except with the explicit sanction of the Liquidator following the Effective Date.

    3.2   Company to Cease Business

            On and as of the Effective Date, the Company shall cease to carry on its enterprise and undertaking, except in so far as may filebe required or as beneficial for the Response. You may obtain a formliquidation and dissolution thereof in the discretion of Response atthe Liquidator. The Company's corporate existence and all its corporate powers, notwithstanding the terms of the Company's articles or by-laws, shall continue under the control of the Liquidator until it is dissolved.


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    3.3   Resignation of Directors

            On and as of the Effective Date, all the powers of the Directors and Officers shall cease and the Directors and Officers shall be deemed to have resigned.


    Article 4
    THE LIQUIDATOR

    4.1   Appointment of Liquidator

            On and as of the Effective Date, Alvarez & Marsal Canada Inc. is hereby appointed as the liquidator of the estate and effects of the Company (theLiquidator) for the purpose of liquidation and dissolution of its business and affairs and distributing its Assets to the Shareholders, after satisfying all prior ranking Claims, all in accordance with the terms of this Liquidation Plan, and who shall serve until removal and replacement in accordance with this Liquidation Plan. The Liquidator shall have the authority to enter into agreements and execute documents for and on behalf of the Company pursuant to the powers and obligations of the Liquidator as contained in this Liquidation Plan or otherwise under the BCBCA.

    4.2   Mandatory Obligations of the Liquidator

            The Liquidator is expressly directed, empowered and authorized to, and shall:

      (a)
      deposit all money that the Liquidator has belonging to the Company in any bank in Canada listed in Schedule I or II to theBank Act (Canada) or in any trust corporation or loan corporation that is registered under theFinancial Institutions Act (BC), theCredit Union Incorporation Act (BC), or in any other depository approved by the Court, Registry.

      If you dowhich deposit shall not filebe made in the name of the Liquidator individually, but shall be a Responseseparate deposit account in the Liquidator's name as Liquidator of the Company, and attend eithersuch money shall be withdrawn for payment of Claims or fees and expenses incurred in person orconnection with the implementation of the Liquidation Plan and signed in accordance with such signing authorities as may be determined by counsel at the time of such Final Application,Liquidator;

      (b)
      forthwith after the Shareholder Approval Date, make an application to the Court may approveunder Section 325 of the Arrangement,BCBCA to have the liquidation of the Company supervised by the Court, including the application for such specific orders as presented,the Liquidator deems appropriate and as permitted by the BCBCA;

      (c)
      establish and implement a court-supervised Claims Process;

      (d)
      pay or may approve itotherwise satisfy all Proven Claims ranking ahead of the Shareholders from the Assets in accordance with the Claims Process;

      (e)
      after satisfying all prior ranking Proven Claims and in accordance with the provisions of the BCBCA and any order of the Court, distribute the remaining Assets rateably among the Shareholders according to their rights and interests in the Company;

      (f)
      cause to be filed with the appropriate Governmental Authority all Tax Returns required to be filed by Novelion and any trusts for which Novelion continues to have responsibility under applicable Legal Requirements;

      (g)
      pay or remit all taxes or other amounts required to be paid or remitted by Novelion in accordance with all applicable statutes, all outstanding CPP contributions and EIA premiums, including any associated interest and penalties and obtain the Clearance Certificates;

      (h)
      cause to be filed with the appropriate Governmental Authority all statements and reports required to be filed by Novelion subject to amendments or exclusions which may be obtained by Court Order during the liquidation proceedings;

      (i)
      maintain the continuous disclosure requirements applicable to the Company under all applicable securities laws, subject to amendments, exclusions or relief which may be obtained by Court Order or from applicable securities regulatory authorities during the liquidation proceedings;

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      (j)
      prepare such termsaccounts, file such notices and conditionscomply with all other applicable requirements and duties as are stipulated by the BCBCA unless otherwise ordered by the Court, shall deem fit, all withoutincluding pursuant to Sections 330, 331, 333, 338, 341, 342 and 343 thereof;

      (k)
      at any further noticetime after the affairs of the Company have been fully liquidated but in accordance with Division 7, Part 10 of the BCBCA, make an application to you. Any person desiring further information about the steps that must be taken prior to making submissions may contact counselCourt for an order approving the winding up and dissolution of the Company and, thereafter, apply for the Petitioner at the address set out above.

      A copydissolution of the PetitionCompany in accordance with the BCBCA; and other documents

      (l)
      after the Effective Date, in the proceedings will be furnished toaccordance with any shareholderorder of the Petitioner or other interested party requestingCourt directing same, request that the sameTransfer Agent refrain from making any changes to the registers maintained by counsel for the Petitioner.Transfer Agent in respect of the Common Shares, except with the explicit sanction of the Liquidator.

    4.3   Discretionary Powers of the Liquidator

    This Requisition        The Liquidator is supported byexpressly empowered and authorized, but not obligated, to do any of the following:

      1.(a)
      Petition dated    •    , 2016bring or defend any action, suit or prosecution, or other legal proceedings, civil or criminal, in the name and filed herein;on behalf of the Company;

      2.(b)
      Affidavit No. 2carry on the business of •    ,the Company so far as may be required or as beneficial for the liquidation and dissolution of the Company;

      (c)
      oversee and address any of the Company's remaining rights and obligations under the Shared Services Agreements with any of the Aegerion Parties and other agreements, if any, under which the Company has ongoing obligations;

      (d)
      engage any former employee of the Company on a "term and task" basis to assist with the Liquidator's administration and implementation of the Liquidation Plan;

      (e)
      sell any of the Assets by public auction or private sale or, where applicable, through a stock exchange, and receive payment of the purchase price either in cash or otherwise;

      (f)
      do all acts and execute, in the name and on behalf of the Company, all documents, and for that purpose use the seal of the Company, if any;

      (g)
      draw, accept, make and endorse any bill of exchange or promissory note in the name and on behalf of the Company;

      (h)
      raise upon the security of the Assets any requisite money;

      (i)
      call meetings of the Shareholders for any purpose the Liquidator thinks fit;

      (j)
      in accordance with the Claims Process or any further order of the Court, compromise all debts and liabilities capable of resulting in debts, and all Claims, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist between the Company and any contributory, alleged contributory or other debtor or person who may be liable to the Company and all questions in any way relating to or affecting the Assets, or the liquidation and dissolution of the Company, upon the receipt of such sums payable at such times and generally upon such terms as are agreed, and the Liquidator may take any security for the discharge of such debts or liabilities and give a complete discharge in respect thereof;

      (k)
      in accordance with and subject to the provisions of the BCBCA and any order of the Court, make or cause to be made, •    , 2016;from time to time, any interim distributions or distributions in kind of portions of the Assets to the Shareholders rateably among the Shareholders according to their rights and interests in the Company, and while maintaining such reserves as are reasonably necessary to provide for all Claims;

      (l)
      liquidate or dissolve subsidiaries of the Company; and

      3.(m)
      Interim Orderdo and execute all such other things as are necessary for the liquidation and dissolution of Master    •    , pronounced    •    , 2016.the business and affairs of the Company and distributing the Assets.

    It is anticipated thatTable of Contents

    4.4   Reporting Obligations

            The Liquidator shall, subject to the requirements of the BCBCA, report to the Shareholders at such times and intervals as the Liquidator may deem appropriate with respect to matters relating to the Assets, Novelion and such other matters as may be relevant to this Final Application will notLiquidation Plan.

    4.5   Removal of the Liquidator

            The Liquidator may be contentious and will take 10 minutesremoved by order of the Court pursuant to a motion brought following either:

      (a)
      a determination by the Liquidator, in its discretion, to be heard.




      Date:

            •      , 2016



      Signature of

      o    Petitionerý    lawyer for the Petitioner

      This REQUISITION was prepareddischarged by the law firmCourt; or

      (b)
      special resolution of Taylor Veinotte Sullivan, Barristers (Attention:    •    ), Suite 300 – 1168 Hamilton Street, Vancouver, British Columbia, V6B 2S2, Telephone: (604) 687-7007.the Shareholders at a meeting called for the purpose of removing the Liquidator, notice of which meeting has been sent to the Liquidator and to each creditor which has an unpaid Claim that exceeds US$1,000,

      but only if such order of the Court appoints another liquidator in the Liquidator's stead which successor liquidator shall become the Liquidator under this Liquidation Plan.

    4.6   Resignation of the Liquidator and Filling Vacancy

            If the Liquidator resigns or is discharged by order of the Court, then a successor liquidator shall be appointed by ordinary resolution of the Shareholders at a meeting called for the purpose of appointing a successor liquidator or by order of the Court, and such successor liquidator shall become the Liquidator under this Liquidation Plan.

    4.7   Fees of the Liquidator and its counsel

            The Liquidator shall be paid its reasonable fees and disbursements at its standard rates and charges, from the Assets as and when the Liquidator renders an account to the Company. Pursuant to Section 325(3) of the BCBCA, the costs, charges and expenses of the liquidation and dissolution, including the remuneration of the Liquidator, are payable out of the Assets in priority to all other Claims.

    4.8   Indemnity

            The Company hereby releases, holds harmless, and indemnifies the Liquidator from and against all liabilities, claims and costs of any nature arising from the Liquidator's execution of this Liquidation Plan, save and except any such liabilities, claims or costs arising as a result of the Liquidator's fraud, gross negligence or wilful misconduct.


    Article 5
    TERMINATION OF EMPLOYEES

    5.1   Termination of Employment

            Those Employees who are requested by the Liquidator to remain in service and assist in the implementation of this Liquidation Plan and agree to do so shall remain Employees of the Company. Any other Employees shall be terminated on the Effective Date.

    5.2   Employment Agreements

            In connection with the termination of any Employees, Novelion will comply with all existing agreements with such Employees, if any.


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    EXHIBIT "A" — DRAFT FINAL ORDERArticle 6
    INSPECTORS

    6.1   Appointment of Inspectors

            The Company or the Liquidator, as applicable, may (but shall not be required to) apply to the Court for an Order appointing any inspectors having any responsibilities as the Company or the Liquidator, as applicable, deem appropriate pursuant to Section 325(3) of the BCBCA.


    Article 7
    DISTRIBUTIONS

    7.1   Delivery of Distribution to Shareholders

            Unless otherwise directed, distributions to Shareholders shall be made by the Liquidator at the addresses set forth in the registers maintained by the Transfer Agent in respect of the Common Shares as at the Effective Date. Beneficial holders of Common Shares shall be entitled to receive distributions only through the applicable Shareholder on the registers maintained by the Transfer Agent in respect of the Common Shares as at the Effective Date.

    7.2   Undeliverable Distributions to Shareholders

            Where the Liquidator is unable to distribute rateably the Assets among the Shareholders because a Shareholder is unknown or a Shareholder's whereabouts is unknown, the share of the Assets of such Shareholder shall be dealt with in accordance with Section 337 of the BCBCA, or as otherwise ordered by the Court.

    7.3   Form of Distributions

            Any distributions to Shareholders shall be made as a distribution of stated capital to the extent of the "paid-up" capital for purposes of the ITA of the Common Shares and, thereafter, as a dividend, in each case subject to satisfying the applicable solvency tests in the BCBCA and theBankruptcy and Insolvency Act (Canada).


    Article 8
    COMPLETION OF THE LIQUIDATION PLAN

    8.1   Discharge of Liquidator

            At the Dissolution Date, the Liquidator shall be discharged and shall have no further obligations or responsibilities, except only with respect to any remaining duties or power required to implement and give effect to the terms of this Liquidation Plan.


    Article 9
    GENERAL PROVISIONS

    9.1   Liquidation Plan Amendment

      (a)
      The Liquidator may, at any time prior to the Dissolution Date, amend, modify and/or supplement this Liquidation Plan without the approval of the Shareholders or the Court, (i) in order to correct any clerical or typographical error, (ii) as required to maintain the validity or effectiveness of this Liquidation Plan as a result of any change in any Legal Requirement, or (iii) in order to make any change that in the opinion of the Liquidator is administrative in nature and does not materially change the terms of this Liquidation Plan.

      (b)
      Subject to the ability of the Liquidator to amend, modify and/or supplement or amend this Liquidation Plan without the approval of the Shareholders or the Court as provided in Section (a), the Liquidator reserves the right, at any time prior to the Dissolution Date, to amend, modify and/or supplement this Liquidation Plan, provided that any such amendment, modification or supplement shall not be

    Table of Contents

        effective until approved by either: (i) a special resolution of the Shareholders at a meeting of Shareholders called for the purposes of approving such amendment, modification or supplement; or (ii) order of the Court.

    9.2   Severability

            In the event that any provision in this Liquidation Plan is held by the Court to be invalid, void or unenforceable, the Court shall have the power to alter and interpret such term or provision to make it valid and enforceable to the maximum extent practicable, consistent with the original purpose of the term or provision held to be invalid, void or unenforceable, and such term or provision shall then be applicable as altered and interpreted. Notwithstanding any such holding, alteration or interpretation, the remainder of the terms and provisions of this Liquidation Plan shall remain in full force and effect and shall in no way be affected, impaired or invalidated by such holding, alteration or interpretation.

    9.3   Paramountcy

            From and after the Effective Date, any conflict between: (A) this Liquidation Plan; and (B) any information summary in respect of this Liquidation Plan, or the covenants, warranties, representations, terms, conditions, provisions or obligations, express or implied, of any contract, document or agreement, written or oral, and any and all amendments and supplements thereto existing between the Company and any of the Shareholders, Directors, Officers or the Liquidator, as at the Effective Date, will be deemed to be governed by the terms, conditions and provisions of this Liquidation Plan, which shall take precedence and priority.

    9.4   Responsibilities of the Liquidator

            The Liquidator will have only those powers granted to it by this Liquidation Plan, by the BCBCA and by any order of the Court.

    9.5   Notices

            Any notice or communication to be delivered hereunder shall be in writing and shall reference this Liquidation Plan and may, subject as hereinafter provided, be made or given by personal delivery, by fax, courier or e-mail addressed to the respective parties as follows:

      (i)
      if to a Shareholder:

        at the addresses set forth in the securities register kept at the Transfer Agent as at the Effective Date;

      (ii)
      if to a Creditor:

        at the addresses set forth in the books and records of the Company or the proofs of claim filed by such Creditor in accordance with the Claims Process

      (iii)
      if to the Company:

        Novelion Therapeutics Inc.

        c/o Norton Rose Fulbright Canada LLP
        510 W Georgia St. Suite 1800
        Vancouver, BC M5X 1B8

    Attention:
     No.Ben Harshbarger and Michael Price

    E-mail:
     
    Vancouver Registryinvestors@novelion.com

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        with a copy to (which shall not constitute notice):

        Norton Rose Fulbright Canada LLP
        222 Bay Street, Suite 3000, P.O. Box 53
        Toronto, Ontario M5K 1E7

    Attention:Evan Cobb
    E-mail:evan.cobb@nortonrosefulbright.com/
      (iv)
      if to the Liquidator:

        Alvarez & Marsal Canada Inc.
        Commerce Place
        400 Burrard Street, Suite 1680
        Vancouver, BC V6C 3A6

    Attention:Anthony Tillman
    Email:atillman@alvarezandmarsal.com

    or to such other address as any party may from time to time notify the others in accordance with this Section 9.5. All such notices and communications which are delivered shall be deemed to have been received on the date of delivery. Any such notices and communications which are faxed shall be deemed to be received on the date faxed if sent before 5:00 p.m. in Vancouver, British Columbia, on a Business Day and otherwise shall be deemed to be received on the Business Day next following the day upon which such fax was sent. Any notice or other communication sent by mail shall be deemed to have been received on the fifth Business Day after the date of mailing. The unintentional failure by the Liquidator to give a notice contemplated hereunder shall not invalidate any action taken by any Person pursuant to this Liquidation Plan.

    IN THE SUPREME COURT OF BRITISH COLUMBIA9.6   Governing Law

    BETWEEN:

    QLT INC.

    PETITIONER        This Liquidation Plan shall be governed by and construed in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein without regard to conflict of laws. All questions as to the interpretation or application of this Liquidation Plan and all proceedings taken in connection with this Liquidation Plan and its provisions shall be subject to the exclusive jurisdiction of the Court.

    RE: IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING QLT INC. AND ITS SECURITYHOLDERS PURSUANT TO SECTIONS 288 TO 299 OF THE        The foregoing Liquidation Plan being adopted by the Board as of this    BUSINESS CORPORATIONS ACT·     (BRITISH COLUMBIA)day of     ·, S.B.C. 2002, c. 57, AS AMENDED

    ORDER MADE AFTER APPLICATION2019.





    BY ORDER OF THE BOARD

     )

    By:

     )•, the



       Name:  

    BEFORE

    )THE HONOURABLE)• day of

       Title:  

    ))•, 2016

    ON THE APPLICATION of the Petitioner, QLT Inc.

    ý    coming on for hearing at 800 Smithe Street, Vancouver, British Columbia on    •    , 2016 and on hearing counsel for the Petitioner,    •    ;

    AND UPON all of the terms of the Interim Order in this proceeding pronounced on    •    , 2016 having been complied with and the requisite approval of the Shareholders of the Petitioner having being obtained at the Meeting (as defined in the Interim Order) of the Petitioner called and held in accordance with the Interim Order;

    AND UPON IT APPEARING that the terms and conditions of the arrangement (the "Arrangement") as described in the plan of arrangement, a copy of which is annexed as Schedule "A" to this Order (the "Plan of Arrangement") may properly be approved by this Honourable Court.

    THIS COURT DECLARES:

    1.
    that the Arrangement be and is hereby approved as being fair and reasonable to the holders of common shares, options, restricted stock units and deferred share units of the Petitioner; and

    THIS COURT ORDERS:

    1.
    that the Arrangement be and is hereby, approved, and shall be implemented in the manner set forth in the Plan of Arrangement and be binding on the Petitioner and its Securityholders in accordance with the terms of the Plan of Arrangement; and

    2.
    that the Petitioner shall, and hereby does, have liberty to apply for such further Order or Orders as may be appropriate.

    Table of Contents

    THE FOLLOWING PARTIES APPROVE THE FORM OF THIS ORDER AND CONSENT TO EACH OF THE ORDERS, IF ANY, THAT ARE INDICATED ABOVE AS BEING BY CONSENT:






    Signature of
    o    petitionerý    lawyer for Petitioner,
    QLT INC.





    By the Court

    Registrar

     

    QLTQPRELIMINARY PROXY CARD - SUBJECT TO COMPLETION NOVELION THERAPEUTICS INC. 8th Floor, 100 University Avenue Toronto, Ontario M5J 2Y1 www.computershare.com 000001 6$0 6$03/(Mr A Sample Designation (if any) Add1 Add2 add3 add4 add5 add6 Security Class 123 6$03/(6 675((7 6$03/(72:1 66 ;9; ;9; &$1$'$ 6HFXULW\ &ODVV &20021 6+$5(6 +ROGHU $FFRXQW 1XPEHU C9999999999 IND )ROG )RUP RI 3UR[\Holder Account Number C1234567890 XXX Fold Form of Proxy - 6SHFLDO 0HHWLQJ WR EH KHOG RQ )HEUXDU\ 11, 2016 7KLV )RUP RI 3UR[\ LV VROLFLWHG E\ DQG RQ EHKDOI RI 0DQDJHPHQW. 1RWHV WR SUR[\Annual General Meeting to be held on Tuesday, November 5, 2019 This Form of Proxy is solicited by and on behalf of Management. Notes to proxy 1. 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If you are voting on behalf of a corporation or another individual you must sign this proxy with signing capacity stated, and you may be required to provide documentation evidencing your power to sign this proxy. 3. This proxy should be signed in the exact manner as the name(s) appear(s) on the proxy. 4. If this proxy is not dated, it will be deemed to bear the date on which it is mailed by Management to the holder. 5. The securities represented by this proxy will be voted as directed by the holder, however, if such a direction is not made in respect of any matter, this proxy will be voted as recommended by Management. 6. The securities represented by this proxy will be voted in favour or withheld from voting or voted against each of the matters described herein, as applicable, in accordance with the instructions of the holder, on any ballot that may be called for and, if the holder has specified a choice with respect to any matter to be acted on, the securities will be voted accordingly. 7. )ROGThis proxy confers discretionary authority in respect of any amendments or variations to matters identified in the Notice of Meeting or other matters that may properly come before the meeting or any adjournment or postponement thereof, in each instance, to the extent permitted by law, whether or not the amendment, variation or other matter that comes before the meeting is routine and whether or not the amendment, variation or other matter that comes before the meeting is contested. 8. 3UR[LHV VXEPLWWHG PXVW EH UHFHLYHG E\ )HEUXDU\ 9, 2016 DWThis proxy should be read in conjunction with the accompanying documentation provided by Management. 9. The Chair of the meeting may waive or extend the proxy cut-off without notice. Fold Proxies submitted must be received by 10:00 $0 (3DFLILF 7LPH) 927( 86,1* 7+( 7(/(3+21( 25 ,17(51(am Eastern Time/7:00 am Pacific Time, on Friday, November 1, 2019 VOTE USING THE TELEPHONE OR INTERNET 24 HOURS A DAY 7 24 +2856 $ '$< 7 '$<6 $ :((.! 7R 9RWH 8VLQJ WKH 7HOHSKRQH 7R 9RWH 8VLQJ WKH ,QWHUQHW ‡ &DOO WKH QXPEHU OLVWHG %(/2: IURP D WRXFK WRQH WHOHSKRQH. 1-866-732-927(DAYS A WEEK! To Vote Using the Telephone • Call the number listed BELOW from a touch tone telephone. 1-866-732-VOTE (8683) 7ROO )UHH ‡ *R WR WKH IROORZLQJ ZHE VLWH ZZZ.LQYHVWRUYRWH.FRP ‡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oll Free To Vote Using the Internet • Go to the following web site: www.investorvote.com • Smartphone? Scan the QR code to vote now. If you vote by telephone or the Internet, DO NOT mail back this proxy. Voting by mail may be the only method for securities held in the name of a corporation or securities being voted on behalf of another individual. Voting by mail or by Internet are the only methods by which a holder may appoint a person as proxyholder other than the Management nominees named on the reverse of this proxy. Instead of mailing this proxy, you may choose one of the two voting methods outlined above to vote this proxy. To vote by telephone or the Internet, you will need to provide your CONTROL NUMBER listed below. CONTROL NUMBER 123456789012345 CPUQC01.E.INT/000001/000001/i *S000001Q01*i1234 01JE2A

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    MR SAM SAMPLE C1234567890 XXX 123 Appointment of Proxyholder I/We being holder(s) of Novelion Therapeutics Inc. hereby appoint(s): Benjamin Harshbarger, or failing him, Michael Price Print the name of the person you are appointing if this person is someone other than the management nominees listed herein. OR as my/our proxyholder with full power of substitution and to attend, act and to vote for and on behalf of the shareholder in accordance with the following direction (or if no directions have been given, as the proxyholder sees fit) and all other matters that may properly come before the Annual General Meeting of shareholders of Novelion Therapeutics Inc. to be held at the offices of Goodwin Procter LLP, 100 Northern Avenue, Boston, Massachusetts 02210 on Tuesday, November 5, 2019 at 10:00 am (Eastern Time) / 7:00 am (Pacific Time) and at any adjournment or postponement thereof. VOTING RECOMMENDATIONS ARE INDICATED BY HIGHLIGHTED TEXT OVER THE BOXES. 1. Liquidation Resolution To approve as a special resolution: (i) the voluntary liquidation and dissolution of the Company pursuant to the Business Corporations Act (British Columbia) at a time to be determined by the Board of Directors of the Company; (ii) the plan of liquidation and distribution substantially in the form attached to our proxy statement as Schedule A; and (iii) one or more distributions to shareholders of any remaining property of the Company under the voluntary liquidation and dissolution, each as more particularly described in our proxy statement. Fold 2. Liquidator Appointment and Remuneration Resolution To approve as an ordinary resolution: (i) the appointment of Alvarez & Marsal Canada Inc. as the liquidator of the Company pursuant to Section 319(2) (a) of the Business Corporations Act (British Columbia) (the “Liquidator”); and (ii) the authorization of the Board of Directors of the Company to set the remuneration of the Liquidator, each as more particularly described in our proxy statement. 3. Election of Directors Withhold Withhold Withhold 01. Dr. Suzanne Bruhn 02. Michael D. Price 03. Dr. Stephen Sabba 4. Named Executive Officers Compensation To approve on a non-binding, advisory basis the compensation of our named executive officers, as more particularly described in our proxy statement. 5. Appointment of Auditors To appoint Deloitte & Touche LLP as the independent registered public accounting firm of Novelion for the fiscal year ending December 31, 2019 and authorizing the Directors to fix their remuneration, as more particularly described in our proxy statement. Fold Signature(s) Date Authorized Signature(s) – This section must be completed for your instructions to be executed. I/We authorize you to act in accordance with my/our instructions set out above. I/We hereby revoke any proxy previously given with respect to the Meeting. If no voting instructions are indicated above, this Proxy will be voted as recommended by Management. MM / DD / YY Q L T Q 286749 X X X X A R 0 999999999999 For Withhold For Against Abstain For For For For Against Abstain For Against Abstain

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