ARC ENERGY FUND 8 ANNOUNCES EXECUTION OF VOTING SUPPORT AGREEMENT WITH MMCAP INTERNATIONAL INC. SPC IN CONNECTION WITH THE PROPOSED GOING-PRIVATE TRANSACTION OF STEP ENERGY SERVICES LTD.

CALGARY, AB, Sept. 25, 2025 /CNW/ - ARC Energy Fund 8 Canadian Limited Partnership, ARC Energy Fund 8 United States Limited Partnership, ARC Energy Fund 8 International Limited Partnership and ARC Capital 8 Limited Partnership (collectively, "ARC Energy Fund 8") issue this press release pursuant to National Instrument 62-104 – Take-Over Bids and Issuer Bids and National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues in respect of its holdings in STEP Energy Services Ltd. ("STEP").

On September 24, 2025, ARC Energy Fund 8 and 2659160 Alberta Ltd. (the "Purchaser" and collectively with ARC Energy Fund 8, the "Purchaser Parties") entered into a voting support agreement (the "Support Agreement") with MMCAP International Inc. SPC ("MMCAP"), pursuant to which MMCAP has agreed to support the Purchaser Parties in completing a proposed going-private transaction involving STEP (the "Proposed Transaction"). The Proposed Transaction is expected to be effected pursuant to a statutory plan of arrangement pursuant to section 193 of the Business Corporations Act (Alberta), and for cash consideration per Common Share of STEP of CAD$5.50.

Pursuant to the Support Agreement, MMCAP has covenanted and agreed that from the date of the Support Agreement until the termination of the Support Agreement it will, among other things, cause the Subject Shares (as defined below) to be counted as present for purposes of establishing quorum and shall vote (or cause to be voted) the Subject Shares  at any meeting of the holders of Common Shares of STEP ("STEP Shareholders") called to vote upon the Proposed Transaction:

(i)

in favour of the approval of the shareholder resolution in respect of the Proposed Transaction and the transactions contemplated thereby, and any other matter necessary for the consummation of such transaction; and

(ii)

against: (A) any acquisition proposal involving STEP or any subsidiary of STEP other than the Proposed Transaction; (B) any action, agreement, transaction or proposal that would result in a breach of any representation, warranty, covenant, agreement or other obligation of MMCAP under the Support Agreement; and/or (C) any matter that could reasonably be expected to delay, prevent, impede or frustrate the successful completion of the Proposed Transaction.

The Support Agreement may be terminated by MMCAP prior to March 24, 2026 if there is a decrease in (or change in the form of) the consideration to be paid for the Common Shares of STEP (from CAD$5.50 per Common Share) pursuant to the Proposed Transaction without the prior written consent of MMCAP or if the Purchaser Parties have not submitted a letter of intent to STEP by October 6, 2025. The Support Agreement will terminate automatically on March 24, 2026 or if the definitive agreement governing the terms of the Proposed Transaction is terminated in accordance with its terms or the parties mutually agree to terminate the Support Agreement.

Pursuant to the Support Agreement, and subject to its terms and conditions, MMCAP has agreed not to directly or indirectly sell, transfer, assign, grant a participation interest in, option, pledge, hypothecate, grant a security interest in, or otherwise convey or encumber, or enter into any forward sale, short sale, repurchase agreement, option or other arrangement or monetization transaction with respect to any of the Subject Shares, or any right or interest therein (legal or equitable) to any person or group of persons, or agree to do any of the foregoing, other than pursuant to the Proposed Transaction prior to the termination of the Support Agreement.

MMCAP beneficially owns, directly or indirectly, or controls 16,401,485 Common Shares of STEP (the "Subject Shares") or 22.51% of the issued and outstanding Common Shares of STEP which would be voted in favour of the Proposed Transaction. The Proposed Transaction will be subject to the requirements of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"), including the "majority of the minority" shareholder approval requirements. The Subject Shares represent 50.26% of the issued and outstanding Common Shares of STEP held by STEP Shareholders other than the Purchaser Parties and ARC Energy Fund 6 Canadian Limited Partnership, ARC Energy Fund 6 United States Limited Partnership, ARC Energy Fund 6 International Limited Partnership and ARC Capital 6 Limited Partnership (collectively, "ARC Energy Fund 6"). It is anticipated that ARC Energy Fund 6 will retain the 13,588,546 Common Shares of STEP (18.6% of the outstanding Common Shares of STEP) that it currently owns in connection with the Proposed Transaction. As of the date hereof, ARC Energy Fund 8 owns, or exercises control or direction over, an aggregate of 26,654,454 Common Shares, representing 36.58% of the issued and outstanding Common Shares.

ARC Energy Fund 8 has not entered into any agreement with STEP to effect the Proposed Transaction. ARC Energy Fund 8 has delivered a non-binding letter of intent to the board of directors of STEP to complete the Proposed Transaction. There can be no assurance that the board of directors of STEP will agree to the terms set forth in the letter of intent or, if accepted, that the parties will enter into a definitive agreement to effect the Proposed Transaction or that Proposed Transaction will be completed by ARC Energy Fund 8.

STEP's address is Bow Valley Square II 1200, 205 5^th Ave SW, Calgary, AB T2P 4B9. A copy of ARC Energy Fund 8's related early warning report will be filed with the applicable securities commissions and will be filed under STEP's SEDAR+ profile at www.sedarplus.ca. Further information and a copy of the early warning report of ARC Energy Fund 8 may be obtained by contacting Tanya Causgrove at [phone] (ARC Energy Fund 8, 4300 400 3rd Ave SW, Calgary, AB T2P 4H2).

FORWARD-LOOKING INFORMATION & STATEMENTS

Certain statements in this press release constitute "forward-looking statements" or "forward-looking information" within the meaning of applicable securities laws. Forward-looking information typically contains statements with words such as "proposed", "expect", "anticipate", "will" or similar words suggesting future outcomes or an outlook.

Forward-looking information in this press release includes, but is not limited to: the Proposed Transaction, including the method by which it will be effected; ARC Energy Fund 6 retaining the Common Shares of STEP that it currently owns in connection with the Proposed Transaction; and the filing of an early warning report with the applicable securities commissions and will be filed under STEP's SEDAR+ profile at www.sedarplus.ca. 

Such forward-looking information is based on a number of assumptions which may prove to be incorrect. Although ARC Energy Fund 8 believes that the expectations reflected in such forward-looking information are reasonable based on the information available at the time of this press release, undue reliance should not be placed on the forward-looking information as ARC Energy Fund 8 can give no assurance that such expectations will prove to be correct. Forward-looking information is based on expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by ARC Energy Fund 8 and described in the forward-looking information.

The forward-looking information contained in this press release is made as of the date hereof and, except as required by applicable securities law, ARC Energy Fund 8 undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise.

SOURCE ARC Financial Corp.