Xebec Adsorption Inc.
TSX : XBC

Xebec Adsorption Inc.

March 17, 2009 23:59 ET

QuestAir Technologies and Xebec Adsorption merger to create a North American Leader in renewable natural gas and gas purification

BURNABY, BC, March 17 - QuestAir Technologies Inc. ("QuestAir";
TSX: QAR) is pleased to announce that it has entered into a definitive
agreement with the shareholders of Blainville, Quebec-based Xebec Adsorption
Inc. ("Xebec"), whereby the parties have agreed to combine their businesses to
create a North American leader in the renewable natural gas and gas
purification sectors.

Andrew Hall, President and CEO of QuestAir said, "A strategic merger with
Xebec provides a solid platform for the next phase of QuestAir's growth.
Xebec's strength in the natural gas vehicle fuel market perfectly complements
our increased focus and success in renewable natural gas. Together, we will
maximize the potential of QuestAir's advanced adsorption technology by
leveraging Xebec's manufacturing facilities in Quebec and China, and its
global sales and distribution networks."

Under the transaction, which requires approval by QuestAir shareholders
and the Toronto Stock Exchange (the "TSX"), QuestAir will issue QuestAir
shares to the shareholders of privately held Xebec. Post transaction, Xebec
shareholders will hold 45% of the merged public company and existing QuestAir
shareholders will hold 55%.

Xebec shareholders will be able to earn additional shares to increase
their shareholding to approximately 57% of the merged company. The number of
additional shares earned will be based on the achievement of certain financial
targets in the 2009 and 2010 fiscal years.

Both QuestAir and Xebec offer products based on proprietary and
conventional adsorption technology. Xebec is a world leader in natural
gas-drying technology for compressed natural gas ("CNG") fueling stations and
a manufacturer of filtration and dehydration equipment for gases and
compressed air. QuestAir is a developer and supplier of gas purification
systems for the biogas upgrading and industrial hydrogen markets.

Xebec is profitable and growing quickly, with top-line growth driven by
increased demand for drying applications for compressed natural gas and
ongoing demand for energy-efficient compressed air dryers. For the fiscal year
ended December 31, 2008, Xebec had revenues of $16.8 million and net income of
$1.2 million (all figures in Canadian dollars).

Kurt Sorschak, President of Xebec Adsorption Inc. said, "Xebec has built
a successful and strong business, with loyal customers and a global footprint.
Our merger with QuestAir will help us pursue leadership positions in growing
sectors such as biogas purification, specialized gas filtration, natural gas
dehydration, and hydrogen purification. Currently these segments provide an
addressable market of over $500 million annually and represent a compelling
business opportunity."

The merged company will be named "Xebec Adsorption Inc." and Xebec's
current President Kurt Sorschak will be named President and CEO. Andrew Hall,
currently President and CEO of QuestAir, will lead the sales and business
development function. The company will be headquartered in Blainville, Quebec,
a suburb north of Montreal, and will maintain operations in Shanghai,
Singapore, Burnaby and Newcastle (UK).

"The transaction announced today will combine two premier clean
technology companies, and create a North American market leader that is a
great deal more than the sum of its parts," said Hall. "We plan to use this
merger to immediately leverage the identified synergies, grow the merged
company quickly and aggressively, and create long-term shareholder value."

A merger will enable QuestAir and Xebec to optimize their technologies to
make further inroads in the fast-growing market for CNG as a vehicle fuel,
including renewable CNG produced from biogas. In the United States, natural
gas vehicle fuel consumption has more than tripled in the past decade, from
793 million cubic feet in December 1998 to 2.5 billion cubic feet in December
2008. In addition, adoption of CNG vehicles has been rapid in some developing
countries, and there are now more than seven million natural gas vehicles
worldwide. Compressed natural gas is gaining ground as an affordable,
low-carbon fuel that produces significantly lower levels of greenhouse gases
than oil-based gasoline and diesel.



Transaction Highlights:

The combined company will:

- utilize Xebec's low-cost manufacturing and supply chains to drive
margin expansion and growth
- leverage QuestAir's proprietary technology in natural gas and
hydrogen adsorption
- fully utilize Xebec's sales and distribution networks in high growth
markets in North America, Asia and Europe
- take full advantage of QuestAir's leading edge adsorption research
and test facilities
- gain on-the-ground presence in key markets through offices and sales
teams based in Singapore, Shanghai, Montreal, Burnaby and Newcastle
(UK)
- gain complementary products and services that target overlapping
markets
- obtain greater exposure to the rapidly growing CNG infrastructure
market
- make further inroads into the evolving market for biogas to CNG
- reduce operating and overhead costs to enhance profitability
- achieve annualized synergies of up to $3.5 million per annum,
excluding restructuring related costs
- gain enhanced market credibility by leveraging Xebec's 40 years of
manufacturing experience

The Combined QuestAir-Xebec Entity at a glance:

- $27.7 million in revenue (pro-forma 2008 revenue)
- Profitability following transaction-related restructuring
- Complete range of products based on proprietary and conventional
adsorption technology
- Leadership position in key markets including biogas upgrading,
natural gas drying, and hydrogen purification
- Extensive base of 1300+ customers that includes market leaders in
compressed natural gas infrastructure, the oil and gas sector, and
biogas project development
- Worldwide distribution and support for all products, with offices in
Blainville, Burnaby, Singapore, Shanghai and Newcastle (UK)
- World-leading R&D and testing capabilities in adsorption technology
- Manufacturing facilities in Quebec and China with approximately
62,000 square feet of combined space
- Experienced leadership team


Terms of the Transaction:

The transaction will be structured as a Plan of Arrangement under the
Canada Business Corporations Act (Canada). Upon completion of the Plan of
Arrangement, all outstanding Xebec common and preferred shares will be
automatically exchanged for 9,407,727 QuestAir common shares. An additional
5,834,249 QuestAir common shares will be issued to the Xebec shareholders and
placed in escrow. The Xebec shareholders will be able to earn the release of
these additional common shares to increase their shareholding upon the
achievement of certain financial targets in the 2009 and 2010 fiscal years.

The Xebec shareholders will also receive 6,180,000 anti-dilution common
share purchase warrants of QuestAir. These warrants, which will have a term of
two years, are intended to allow the Xebec shareholders to maintain their
ownership interest in QuestAir as existing QuestAir warrants are exercised.
The anti-dilution warrants will only become exercisable upon, and to the
extent of, the exercise of the existing QuestAir warrants. The anti-dilution
warrants will have an exercise price of $2.15 per share, will not be
transferable and will not be listed on the TSX.

Upon completion of the transaction, QuestAir shareholders will hold 55%
of the outstanding shares of the merged company, and the Xebec shareholders
will hold 45% of the outstanding shares. If the Xebec shareholders earn the
release in full of the escrowed shares, the Xebec shareholders will hold
approximately 57% of the combined company. Any escrowed shares not released
will be returned to the merged company and cancelled.

The final step of the Plan of Arrangement is the amalgamation of QuestAir
and Xebec.

Insiders holding approximately 47.4% of the outstanding shares of
QuestAir have agreed to support the transaction at the special meeting of the
QuestAir shareholders that will be called to consider the transaction.

Closing:

Closing of the transaction is subject to customary conditions, including,
but not limited to, approval by a favorable vote of at least 66 and 2/3 per
cent of the votes cast in person or by proxy by QuestAir shareholders at a
special shareholders meeting, and the receipt of court and necessary
regulatory approvals, including the approval of the TSX.

An information circular for the special shareholders' meeting of QuestAir
is expected to be mailed in late March 2009 and QuestAir plans to hold a
special meeting to approve the transaction in late April 2009. If approved,
the transaction is expected to close shortly thereafter.

Board Recommendations:

The merger of QuestAir Technologies Inc. and Xebec Adsorption Inc. has
been unanimously approved by the boards of directors of both QuestAir and
Xebec. The board of directors of QuestAir has determined that the transaction
is in the best interests of QuestAir shareholders and unanimously recommends
that QuestAir shareholders vote in favour of the transaction. Each Director
and Officer of QuestAir, in aggregate holding 2.5% of the QuestAir common
shares, has entered into an agreement to vote in support of the transaction.

Advisors:

Deloitte & Touche LLP acted as financial advisor to QuestAir and provided
a fairness opinion to the board of directors of QuestAir that the transaction
is fair, from a financial point of view, to QuestAir's shareholders.

McCarthy Tétrault LLP acted as QuestAir's legal counsel.

Celtis Capital Inc. acted as financial advisor to Xebec and De Grandpre
Chait LLP acted as legal counsel to Xebec and the Xebec shareholders.

About QuestAir Technologies Inc.

QuestAir Technologies, Inc. is a developer and supplier of proprietary
gas purification systems for several large international markets, including
biogas production, natural gas processing and oil refining. QuestAir is based
in Burnaby, British Columbia and its shares trade on the Toronto Stock
Exchange under the symbol "QAR".

About Xebec Adsorption Inc.

Xebec Adsorption Inc. specializes in the design and manufacture of
filtration, purification, separation and dehydration equipment for compressed
air and gases. Xebec Adsorption's regenerative adsorption equipment, filters
and other products provide environmentally-responsible engineered solutions to
its customers in order to ensure their productivity and profitability. The
company operates out of a state-of-the-art manufacturing facility located in
Blainville, Quebec. Xebec Adsorption products and services include design,
engineering, coded welding, fabrication and assembly capabilities. All Xebec
Adsorption products are designed and manufactured according to stringent
quality specifications (including ISO 9001: 2000, ISO 14001: 2004 and OHSAS
18001: 1999) and in accordance with multiple pressure vessel codes.

Forward Looking Statements

Certain statements in this press release may constitute "forward-looking"
statements within the meaning of applicable securities laws. This forward
looking information includes, but is not limited to, the expectations and/or
claims of management of QuestAir and Xebec with respect to the completion of
the transaction, the synergies that can be achieved by combining the two
companies, and information regarding the business, operations and financial
condition of QuestAir and Xebec. Forward looking information contained in this
press release involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of QuestAir,
Xebec and the merged company, or industry results, to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such risks and uncertainties include, but are
not limited to, uncertainties related to whether the QuestAir shareholders
will approve the transaction; uncertainties related to whether all required
third-party, court, regulatory and governmental approval to the transaction
will be obtained, or other conditions to the completion of the transaction
will be satisfied or waived; and uncertainties with regard to anticipated
synergies and other benefits of the transaction. This list is not exhaustive
of the factors that may affect forward-looking information contained in this
press release. When used in this press release, such statements use such words
as "anticipate", "believe", "plan", "estimate", "expect", "intend", "may",
"will" and other similar terminology. These statements reflect current
expectations regarding future events and operating performance and speak only
as of the date of this press release. Forward-looking statements involve
significant risks and uncertainties, should not be read as guarantees of
future performance or results, and will not necessarily be accurate
indications of whether or not such results will be achieved. A number of
factors could cause actual results to differ materially from the results
discussed in the forward-looking statements.

%SEDAR: 00021328E

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