Mr. Brett Hodson reports

ANAERGIA ANNOUNCES STRATEGIC INVESTMENT OF C$40.8 MILLION TO BE SECURED BY BANK GUARANTEES

Anaergia Inc. has arranged a $40.8-million equity investment by Marny Investissement SA, by way of an arm's-length, three-tranche, non-brokered private placement.

Marny, through a wholly owned subsidiary (Marny Holdco), has agreed to subscribe for an aggregate of 102 million units of the company at a price of 40 cents per unit, with each unit consisting of one subordinate voting share of the company and one-fifth of one subordinate voting share purchase warrant of the company. Each warrant will entitle Marny to purchase one additional subordinate voting share at an exercise price of 80 cents for a period of three years following the closing of the first tranche. The unit subscription price of 40 cents represents a 57-per-cent premium to the 10-day volume-weighted average price of the subordinate voting shares on the Toronto Stock Exchange (TSX) as of Dec. 15, 2023.

The Strategic investment will close in three tranches of 34 million units for gross proceeds of $13.6-million each. The first, second and third tranches may close no later than Jan. 15, 2024, Feb. 15, 2024, and March 15, 2024, respectively. The strategic investment is subject to, among other things, the timely fulfilment of the payment obligations under the subscription by Marny and the delivery by Marny of guarantees in respect of the payment obligations, acceptable to Anaergia, acting reasonably, on or about Dec. 22, 2023 (the interim conditions completion date). The closing of the first, second and third tranches are subject to a limited number of customary conditions.

"As part of its strategic review process, the company has focused on reducing costs, eliminating certain debt burdens and obligations, and improving liquidity. The strategic investment reflects the confidence that Marny has in these efforts to unlock the potential value in Anaergia's long-term vision. The aggregate proceeds from the strategic investment are designed to enhance our liquidity position over time, providing us, potentially, with the resources to navigate current challenges as we have previously disclosed," said Brett Hodson, the chief executive officer of Anaergia. "We appreciate the support of our stakeholders as we work towards strengthening our financial foundation and achieving our business plans. The anticipated capital injections reaffirm our commitment to delivering on our business strategy to drive sustainable success and harness the exciting opportunities that lie ahead for Anaergia."

"We are pleased to make the strategic investment in Anaergia, which is well positioned as a worldwide global renewable fuels leader," said Ohad Epschtein, the beneficial owner of Marny. "We have analyzed Anaergia's unique technology and manufacturing capabilities, and we are very optimistic that the strategic investment will allow the company to unlock additional growth and potential. We expect to work closely with Dr. Andrew Benedek and Anaergia's management team as we continue to expand and grow Anaergia's business interests in new directions, all with the ultimate goal of creating a cleaner and better world."

Anaergia intends to use the proceeds from the strategic investment to pay accounts payable and to finance its continuing activities.

Marny has the right (the allotment option), in its sole discretion, to allocate an aggregate of 10.2 million of the subordinate voting shares for which it has subscribed to certain individual investors (the Marny individual investors), on a pro rata basis for each tranche, and any such Marny individual investors shall grant an irrevocable proxy to Marny Holdco in respect of the voting rights for such subordinate voting shares.

On the interim conditions completion date, Anaergia will enter into an investor rights agreement with Marny and Dr. Benedek, providing for, among other things, customary registration rights and participation rights, and certain information and director nomination rights, including the right for Marny to nominate a majority of the company's board of directors, following the closing of the third tranche of the strategic investment, so long as Marny owns or controls at least 40 per cent of the voting power attached to the company's shares. The investor rights agreement will become effective as of the closing of the first tranche of the strategic investment. Following the completion of the first tranche of the strategic investment, Marny will have the right to appoint one nominee to the company's board of directors. The investor rights agreement will supersede and replace the company's existing principal shareholders agreement with Dr. Benedek.

Dr. Benedek has agreed to waive his pre-existing right to participate on a pro rata basis in equity financings by the company and to convert one-third of all multiple voting shares of the company held by him into subordinate voting shares on a one-for-one basis in accordance with Anaergia's constating documents with the closing of each tranche of the strategic investment.

Assuming the exercise in full, of the warrants, 122.4 million subordinate voting shares will be issued pursuant to the strategic investment, representing in aggregate approximately 187.2 per cent of the 32,222,369 currently issued and outstanding multiple voting shares and 33,179,135 of the currently issued and outstanding subordinate voting shares.

Following the completion of the strategic investment and the conversion of the multiple voting shares held by Dr. Benedek, Marny will own (or own or control, if the allotment option is exercised) approximately 60.9 per cent of the issued and outstanding subordinate voting shares (on a non-diluted basis) and 65.2 per cent of the issued and outstanding subordinate voting shares (on a partially diluted basis) assuming the exercise in full of the warrants. Following the completion of the first tranche of the strategic investment and the conversion of one-third of the multiple voting shares held by Dr. Benedek, Marny will own (or own or control, if the allotment option is exercised) approximately 20.8 per cent of the voting rights attached to the subordinate voting shares and the multiple voting shares (on a non-diluted basis), and 23.9 per cent of the voting rights attached to the subordinate voting shares and the multiple voting shares (on a partially diluted basis) assuming the exercise in full of the warrants.

In connection with the strategic investment, the company has provided an undertaking to the TSX to reclassify the subordinate voting shares as common shares and to eliminate the multiple voting shares from the company's authorized capital within 60 days from the closing of the third tranche of the strategic investment. Pursuant to a voting and support agreement, Dr. Benedek will agree to vote in favour of the reclassification.

The TSX will generally require security holder approval as a condition of acceptance of a notice under Section 602 if a private placement: (i) materially affects control of the listed issuer pursuant to Section 604(a)(i) of the TSX company manual; or (ii) provides for the issuance of greater than 25 per cent of the currently outstanding listed securities pursuant to Section 607(g)(i) of the manual. Section 604(d) of the manual provides that such approval may be obtained in writing from shareholders holding a majority of the outstanding voting securities of the listed issuer without the requirement to convene a shareholders meeting for such purposes, and the company intends to obtain shareholder approval for the strategic investment in such a manner by having the company's major shareholder, Dr. Benedek, provide a written consent.

Piper Sandler & Co. is acting as financial adviser to the company in connection with the strategic investment.

The subordinate voting shares to be issued pursuant to the strategic investment will be subject to a statutory four-month hold period in accordance with applicable Canadian securities laws.

About Anaergia Inc.

Anaergia was created to eliminate a major source of greenhouse gases (GHGs) by cost-effectively turning organic waste into renewable natural gas (RNG), fertilizer and water through the use of proprietary technologies. With a record of delivering innovative projects, Anaergia is uniquely positioned to provide solutions to today's most pressing resource recovery challenges using a broad portfolio of proven technologies and multiple project delivery methods. Anaergia is one of the world's only companies with a proprietary portfolio of end-to-end solutions that integrate solid waste processing as well as waste water treatment with organics recovery, high-efficiency anaerobic digestion, RNG production, and recovery of fertilizer and water from organic residuals. The combination of these technologies enhances carbon-negative biogas, clean water and natural fertilizer production, utilizes a minimized footprint, and lowers waste and waste water treatment costs and GHG emissions.

We seek Safe Harbor.