EverGen Infrastructure Corp.

A copy of this second amended and restated preliminary prospectus has been filed with the securities regulatory authorities in each of the provinces of Canada, but has not yet become final for the purpose of the sale of securities. Information contained in this second amended and restated preliminary prospectus may not be complete and may have to be amended. The securities may not be sold until a receipt for the prospectus is obtained from the securities regulatory authorities.

No securities regulatory authority has expressed an opinion about these securities and it is an offence to claim otherwise. This prospectus constitutes a public offering of these securities only in those jurisdictions where they may be lawfully offered for sale and therein only by persons permitted to sell such securities. The securities offered hereunder have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the “ U.S. Securities Act ”), or any state securities laws. Accordingly, these securities may not be offered or sold in the United States (as defined below) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration requirements is available. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any of these securities within the United States. See “Plan of Distribution”.

SECOND AMENDED AND RESTATED PRELIMINARY PROSPECTUS

AMENDING AND RESTATING THE AMENDED AND RESTATED PRELIMINARY PROSPECTUS DATED MAY 5, 2021, WHICH AMENDED AND RESTATED THE PRELIMINARY PROSPECTUS DATED APRIL 28, 2021

Initial Public Offering

July 9, 2021

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$20,020,000

3,080,000 Units

This prospectus (the “ Prospectus ”) qualifies the distribution to the public of 3,080,000 units (the “ Offered Units ”) of EverGen Infrastructure Corp. (the “ Company ” or “ EverGen ”) at a price of $6.50 per Offered Unit (the “ Offering Price ”) for gross proceeds to the Company of $20,020,000 (the “ Offering ”). If the Over-Allotment Option (as defined below) is exercised in full, 3,542,000 Units will be sold by the Company. See “ Plan of Distribution ”.

Each Offered Unit consists of one Common Share (as defined herein, and as a constituent of the Offered Unit, a “ Unit Share ”) and one-half of one Common Share purchase warrant of the Company (each whole Common Share purchase warrant, a “ Warrant ”). Each Warrant will entitle the holder to acquire, subject to adjustment in accordance with the Warrant Indenture (as defined below) one Common Share (a “ Warrant Share ”) at a price of $10.50 per Warrant Share at any time prior to 5:00 p.m. (Vancouver time) on the date that is 24 months following the Closing Date (as defined below) (the “ Expiry Date ”). The Warrants will be governed by a warrant indenture (the “ Warrant Indenture ”) to be entered into on or before the Closing Date between the Company and TSX Trust Company, as warrant agent. See “ Description of the Securities Being Distributed ”.

The strategy of EverGen is to develop, own, and operate renewable natural gas (“ RNG ”) projects using proven technologies and intends to supply RNG primarily into the gas grid through the operation of RNG projects. EverGen also develops, owns, and operates organics processing facilities which process municipal source separated organics and food waste under long-term contracts. These organics are converted to soil products via composting and are intended to be converted to biogas via anaerobic digestion. The biogas would then be upgraded to RNG and sold to gas utilities under long term contracts. EverGen’s projects are currently located in British Columbia, Canada, and the Company plans to become the dominant supplier of RNG in the form of purified biomethane to FortisBC, the local

EVERGEN; CANADA’S RENEWABLE NATURAL GAS INFRASTRUCTURE PLATFORM FOR OUR COMMUNITIES, IN OUR COMMUNITIES

EverGen is expediting Canada’s journey to not just show up, but to compete on the global renewable natural gas stage, at the leading edge of combating climate change and helping communities contribute to a sustainable future, starting on the West Coast.

RENEWABLE NATURAL GAS

Renewable Natural Gas doesn’t just have a low carbon footprint (like wind and solar), the production of RNG captures emissions and is often carbon negative.

Re·new·a·ble Nat·u·ral Gas

/rəˈn(y)ooəb(ə)l ˈnaCH(ə)rəl gas/

RNG is produced differently than conventional natural gas. It is derived from biogas, which is produced by decomposing organic waste found in landfills, agricultural waste and wastewater treatment facilities.

The biogas is captured and cleaned to create a sustainable fuel, Renewable Natural Gas (also called biomethane).

Why RNG?

Sustainable: Recycling of organic waste into energy solves a growing waste problem, reducing emissions and providing a clean energy source

Existing Infrastructure: RNG uses existing gas pipeline network (connect to residential, commercial & industrial uses) providing lowcost energy transition

Re-imaging Waste as Feedstock: Municipal landfill bans diverts organic waste and drives feedstock supply growth

Growing Demand: Consumer demand & regulatory momentum (net zero targets & incentives expediting clean energy transition by industry & governments)

How It Works: The RNG Process

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Leading the build-out of sustainable RNG infrastructure in Canada

Our team combines an entrepreneurial mindset with a sophisticated approach to “infra-tizing” the fragmented RNG sector. We rely on our diverse background & technical expertise across over 60 RNG projects to maintain our first mover advantage in Canada

Capturing a Large Market Opportunity

North American gas utilities are looking to achieve 5-15% clean energy / RNG in their systems compared to less than 1% today. FortisBC providing long-term offtake agreements of up to $30/GJ to achieve their goal of 15% RNG by 2030 (totalling $16bn of potential contracts over the life of the program)

Strategy

Infrastructure platform approach to acquiring, developing, owning and operating RNG projects with a focus on reliably supplying the North American gas grid with clean energy

Delivering a Robust Growth Pipeline

Harnessing Global Momentum

Significant momentum and desire for sustainable solutions that reduce GHG emissions and environmental impact of energy generation & current waste management practices. EverGen tackles these two critical sustainability problems - reimaging organic waste as a clean energy source using RNG infrastructure.

Strong pipeline of RNG projects, partnership & acquisition opportunities including conversions, optimization and development projects in Canada with a near-term cash flow focus

ACQUIRED 3

OPERATING PROJECTS IN 4 MONTHS

PROCESSING >100k TONNES OF ORGANIC WASTE

EXPERIENCE IN DEVELOPING AND OPERATING OVER 60 PROJECTS PRODUCING OVER 80,000 GJ OF RNG ANNUALLY

gas utility, and expand its operations in North America, including actively pursuing the development of project clusters similar to the one in British Columbia in the provinces of Alberta, Ontario and Québec.

The Offering is being sold pursuant to the terms of an underwriting agreement (the “ Underwriting Agreement ”) dated July ●, 2021, among the Company, Desjardins Securities Inc. (“ Desjardins ”), Clarus Securities Inc. (“ Clarus ”), Echelon Wealth Partners Inc. (“ Echelon ”), RBC Dominion Securities Inc. (“ RBC ”, and together with Desjardins, Clarus and Echelon, the “ Co Lead Underwriters ”), Haywood Securities Inc. and PI Financial Corp. (collectively with the Co-Lead Underwriters, the “ Underwriters ”). The terms of the Offering, including the Offering Price was determined by arm’s length negotiation between the Company and the Co-Lead Underwriters, on behalf of the Underwriters, in the context of the market. See “ Plan of Distribution ”.

Price: $6.50 per Offered Unit

Per Offered Unit Total(4) Notes:	Offering Price to the Public(1) $6.50 $20,020,000	Underwriters’ Fee(2) $0.39 per Offered Unit $1,201,200	Net Proceeds to the Company(3)
			$6.11 per Offered Unit $18,818,800

(1) The Offering Price has been determined by arm’s length negotiation between the Company and the Co-Lead Underwriters, on behalf of the Underwriters.
(2) The Underwriters will receive a cash fee (the “ Underwriters’ Fee ”) equal to 6% of the gross proceeds of the Offering (including proceeds received upon the exercise of the Over-Allotment Option), subject to a reduced fee of 3% for the Offered Units sold by the Underwriters to certain purchasers designated by the Company who may purchase up to an aggregate of $1,001,000 of Offered Units (the “ President’s List ”).
(3) After deducting the Underwriters’ Fee but before deducting expenses of the Offering, estimated to be $1,000,000 . The expenses of the Offering will be paid by the Company out of the gross proceeds of the Offering. Aggregate participation in the President’s List shall not exceed 5% of the Offering.
(4) The Company has granted the Underwriters an over-allotment option (the “ Over-Allotment Option ”) exercisable, in whole or in part, at the sole discretion of the Underwriters, at any time up to 30 days from and including the Closing Date (as defined below) (the “ Over-Allotment Deadline ”), to purchase up to an additional 462,000 Offered Units (the “ Over-Allotment Units ”) equal to 15% of the aggregate number of Offered Units sold pursuant to the Offering at the Offering Price, to cover over-allotments, if any, and for market stabilization purposes. All references to “Offered Units” in this Prospectus includes the Over-Allotment Units that may be issued and sold pursuant to the OverAllotment Option. A purchaser who acquires securities forming part of the Underwriters’ over-allocation position acquires those securities under this Prospectus, regardless of whether the over-allocation position is ultimately filled through the exercise of the Over-Allotment Option or secondary market purchases. The Over-Allotment Option may be exercised to acquire (i) Over-Allotment Units at the Offering Price, or (ii) additional Unit Shares (the “ Over-Allotment Shares ”) at a price of $6.32 per Over-Allotment Share, or (iii) additional Warrants (the “ Over-Allotment Warrants ”) at a price of $0.18 for each one-half of one Over-Allotment Warrant, or (iv) any combination of OverAllotment Units, Over-Allotment Shares and Over-Allotment Warrants, so long as the aggregate number of Over-Allotment Shares and Over-Allotment Warrants that may be issued under the Over-Allotment Option does not exceed 462,000 Over-Allotment Shares and 231,000 Over-Allotment Warrants. The Over-Allotment Shares and Over-Allotment Warrants are collectively referred to herein as the “ OverAllotment Securities ”. If the Underwriters exercise the Over-Allotment Option in full, the gross proceeds raised under the Offering will be $23,023,000, the Underwriters’ Fee will be $1,381,380, and the net proceeds to the Company will be $21,641,620 (before deducting expenses of the Offering). The Over-Allotment Option is exercisable by the Co-Lead Underwriters giving notice to the Company prior to the OverAllotment Deadline, which notice shall specify the number of Over-Allotment Securities to be purchased. This Prospectus qualifies the grant of the Over-Allotment Option. See “ Plan of Distribution ”.
(5) All calculations above assume no Offered Units are sold to President’s List purchasers.

The following table sets out the maximum number of Over-Allotment Units that may be sold by the Company to the Underwriters assuming the Over-Allotment Option is exercised in full.

Underwriters’ Position Over-Allotment Option	Maximum Size or Number of Securities Available 462,000 Over-Allotment Units	Exercise Period For a period of 30 days from and including the Closing Date	Exercise Price
			$6.50 per Over-Allotment Unit

Unless otherwise indicated or required, all references in this Prospectus to the “Offering”, “Offered Units”, “Unit Shares”, “Warrants” and “Warrant Shares” includes all securities issuable pursuant to any exercise of the OverAllotment Option.

In connection with the Offering, subject to applicable laws, the Underwriters may over-allot or effect transactions intended to stabilize or maintain the market price of the Common Shares at levels other than those which otherwise might prevail on the open market. Such transactions, if commenced, may be discontinued at any time. The Underwriters may offer the Offered Units at a lower price than stated above . See “ Plan of Distribution ”.

The Company has applied to list its Common Shares (including the Unit Shares and the Warrant Shares) on the TSX Venture Exchange (the “ TSX-V ”) under the symbol “EVGN”. Listing is subject to approval by the TSX-V of the Company’s listing application and the Company fulfilling all of the requirements and conditions of the TSX-V, including distribution of Common Shares to a minimum number of public shareholders. The TSX-V has not conditionally approved the listing of the Common Shares (including the Unit Shares, the Warrant Shares, the Special Warrant Unit Shares, the Special Warrant Shares, the Broker Unit Shares and the Broker Warrant Shares) and there is no assurance that the TSX-V will approve the Company’s listing application. Closing of the Offering is conditional upon the aforementioned securities being approved for listing on the TSX-V. See “ Risk Factors ” and “ Plan of Distribution ”.

There is currently no market through which the Unit Shares or Warrants comprising the Offered Units may be sold and purchasers may not be able to resell securities purchased under this Prospectus. This may affect the pricing of the securities in the secondary market, the transparency and availability of trading prices, the liquidity of the securities, and the extent of issuer regulation. See “ Risk Factors ”.

As at the date of this Prospectus, EverGen does not have any of its securities listed or quoted, has not applied to list or quote any of its securities, and does not intend to apply to list or quote any of its securities, on the Toronto Stock Exchange, Aequitas NEO Exchange Inc., a U.S. marketplace, or a marketplace outside Canada and the United States of America (other than the Alternative Investment Market of the London Stock Exchange or the PLUS markets operated by PLUS Markets Group plc).

Investing in the Offered Units is speculative, involves significant risks, and should only be made by persons who can afford the total loss of their investment. Prospective investors should carefully review and evaluate certain risk factors contained in this Prospectus before purchasing the Offered Units. See “ Statement Regarding Forward-Looking Information ” and “ Risk Factors ”.

Prospective investors should rely only on the information contained in this Prospectus. The Company and the Underwriters have not authorized anyone to provide investors with information different from that contained in this Prospectus. The Underwriters are offering to sell and seeking offers to buy the Offered Units only in jurisdictions where, and to persons whom, offers and sales are lawfully permitted. Investors should not assume that the information contained in this Prospectus is accurate as of any date other than the date of this Prospectus.

Prospective investors are advised to consult their own legal counsel and other professional advisors in order to assess income tax, legal and other aspects of this investment based upon their own personal circumstances.

The Underwriters, as principals, conditionally offer the Offered Units, subject to prior sale, if, as and when issued and sold by the Company and accepted by the Underwriters in accordance with the terms and conditions contained in the Underwriting Agreement, and subject to the approval of certain legal matters on behalf of the Company by Borden Ladner Gervais LLP and on behalf of the Underwriters by Cassels Brock & Blackwell LLP.

The Offered Units are being offered for sale in each of the provinces of Canada pursuant to this Prospectus and in the United States on a private placement basis pursuant to available exemptions under applicable United States securities laws. Subject to compliance with applicable law, the Underwriters may also offer the Offered Units in such other jurisdictions outside of Canada and the United States, as agreed between the Company and the Underwriters.

Subscriptions for the Offered Units will be received subject to rejection or allotment, in whole or in part, and the Underwriters reserve the right to close the subscription books at any time without notice. It is expected that the closing of the Offering (the “ Closing ”) will take place on or about ●, 2021 or such other date as the Company and the Underwriters may agree, but in any event, not later than 42 days after the date of the receipt for the (final) prospectus

iii

(the date on which Closing occurs being the “ Closing Date ”), unless an amendment to this Prospectus is filed and a receipt has been issued for such amendment.

It is anticipated that the Company will arrange for one or more instant deposits of the Offered Units issued and sold hereunder with Clearing and Depository Services Inc. (“ CDS ”) or its nominee through the non-certificated inventory system administered by CDS on the Closing Date, or will otherwise duly and validly deliver the Offered Units as directed by the Underwriters on the Closing Date. Except in limited circumstances or as specifically required, no certificates will be issued to purchasers of the Offered Units and a purchaser will receive only a customer confirmation from a registered dealer that is a CDS participant and from or through which the Offered Units are purchased. See “ Plan of Distribution ”.

The Company’s head office is located at Suite 390, 1050 Homer Street, Vancouver, British Columbia, Canada, V6B 2W9 and its registered office located at 1200 Waterfront Centre, 200 Burrard Street, Vancouver, British Columbia, Canada, V6C 3L6.

GLOSSARY.............................................................................................................................................................................................................. 1 ABOUT THIS PROSPECTUS .................................................................................................................................................................................. 9 MEANING OF CERTAIN REFERENCES .............................................................................................................................................................. 9 STATEMENT REGARDING FORWARD-LOOKING INFORMATION ............................................................................................................... 9 EXCHANGE RATE AND CURRENCY INFORMATION ................................................................................................................................... 12 ENFORCEMENT OF JUDGMENTS AGAINST FOREIGN PERSONS ............................................................................................................... 13 THIRD PARTY INFORMATION .......................................................................................................................................................................... 13 MARKETING MATERIALS ................................................................................................................................................................................. 13 NON-IFRS MEASURES ........................................................................................................................................................................................ 14 ELIGIBILITY FOR INVESTMENT....................................................................................................................................................................... 15 PRESENTATION OF FINANCIAL INFORMATION AND ACCOUNTING PRINCIPLES ............................................................................... 16 PROSPECTUS SUMMARY ................................................................................................................................................................................... 17 CORPORATE STRUCTURE ................................................................................................................................................................................. 28 GENERAL DEVELOPMENT AND BUSINESS OF THE COMPANY ................................................................................................................ 29 USE OF PROCEEDS .............................................................................................................................................................................................. 49 PLAN OF DISTRIBUTION .................................................................................................................................................................................... 51 SELECTED HISTORICAL FINANCIAL INFORMATION AND PRO FORMA FINANCIAL INFORMATION .............................................. 54 MANAGEMENT’S DISCUSSION AND ANALYSIS .......................................................................................................................................... 57 DESCRIPTION OF SECURITIES BEING DISTRIBUTED .................................................................................................................................. 57 DIVIDEND POLICY .............................................................................................................................................................................................. 59 CONSOLIDATED CAPITALIZATION................................................................................................................................................................. 59 PRIOR SALES ........................................................................................................................................................................................................ 68 ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTION ON TRANSFER ....................................... 70 PRINCIPAL SHAREHOLDERS ............................................................................................................................................................................ 73 DIRECTORS AND EXECUTIVE OFFICERS ....................................................................................................................................................... 74 DIRECTOR AND EXECUTIVE COMPENSATION ............................................................................................................................................ 79 INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS................................................................................................................... 87 AUDIT COMMITTEE ............................................................................................................................................................................................ 87 STATEMENT ON CORPORATE GOVERNANCE .............................................................................................................................................. 88 CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS .......................................................................................................... 93 RISK FACTORS ..................................................................................................................................................................................................... 97 PROMOTERS ....................................................................................................................................................................................................... 113 LEGAL PROCEEDINGS AND REGULATORY ACTIONS .............................................................................................................................. 114 INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS ................................................................................... 114 AUDITOR, TRANSFER AGENT AND REGISTRAR ........................................................................................................................................ 114 MATERIAL CONTRACTS .................................................................................................................................................................................. 114 EXPERTS ............................................................................................................................................................................................................. 115 STATUTORY AND CONTRACTUAL RIGHTS OF RESCISSION ................................................................................................................... 115 APPENDIX “A” EVERGEN INFRASTRUCTURE CORP. AUDIT COMMITTEE CHARTER ........................................................................ A-1 INDEX TO FINANCIAL STATEMENTS AND MANAGEMENT’S DISCUSSION & ANALYSIS .................................................................F-1 CERTIFICATE OF THE COMPANY .................................................................................................................................................................. C-1 CERTIFICATE OF THE PROMOTERS .............................................................................................................................................................. C-2 CERTIFICATE OF THE UNDERWRITERS ....................................................................................................................................................... C-3

GLOSSARY

In this Prospectus, the following capitalized terms have the following meanings, in addition to other terms defined elsewhere in this Prospectus.

“ Acquired Businesses ” means collectively, the businesses acquired by the Company pursuant to the Acquisitions.

“ Acquisitions ” means collectively, the NZWA Acquisition, the SSS Acquisition and the FVB Acquisition.

“ AD ” means anaerobic digestion.

“ Additional Agreements ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – The SSS Project ”.

“ Agency Agreement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ April 2021 Private Placement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Articles ” means the Articles of Incorporation of the Company dated May 13, 2020.

“ Audit Committee ” means the Audit Committee of the Board.

“ Automatic Exercise Date ” means the earlier of (i) the Prospectus Automatic Exercise Date; and (ii) the first business day following the Exercise Deadline.

“ BCBCA ” means the Business Corporations Act (British Columbia), as amended.

“ Board ” means the board of directors of the Company.

“ Broker Compensation Options ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Broker Options ” has the meaning ascribed to such term on under “ General Development and Business of the Company – General Development of the Company – History” .

“ Broker Unit ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Broker Unit Share ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Broker Unit Warrant ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Broker Warrant Share ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Broker Warrants ” has the meaning ascribed to such term on under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Brokered Private Placement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ CDS ” has the meaning ascribed to such term on the fourth cover page of this Prospectus.

“ CFS ” has the meaning ascribed to such term under “ General Development and Business of the Company – Business of EverGen Infrastructure Corp. – Industry Overview and Competitive Conditions – Regulatory Frameworks ”.

“ Clarus ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Closing ” has the meaning ascribed to such term on the fourth cover page of this Prospectus.

“ Closing Date ” has the meaning ascribed to such term on the fourth cover page of this Prospectus.

“ Code ” has the meaning ascribed to such term under “ General Development and Business of the Company – Social and Environmental Policies ”.

“ Co-Lead Underwriters ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Common Share ” means a common share in the capital of the Company, as currently constituted.

“ Controller ” has the meaning ascribed to such term under “ Eligibility For Investment ”.

“ Corporate Governance and Nomination Committee ” means the Corporate Governance and Nomination Committee of the Board.

“ CRA ” means the Canada Revenue Agency.

“ December Directors and Officers ” has the meaning ascribed to such term under “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer – Other Contractual Restrictions ”.

“ December Lock-Up Agreements ” has the meaning ascribed to such term under “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer – Other Contractual Restrictions ”.

“ December Non-Brokered Private Placement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Desjardins ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ DSU ” means a deferred share unit of the Company which is convertible into treasury Common Shares or, upon the joint election of the Company and the Participant, a cash payment or a combination thereof, granted pursuant to the Equity Incentive Plan.

“ EBITDA PSUs ” has the meaning ascribed to such term under “ Options to Purchase Securities – PSUs ”.

“ Echelon ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ EHS ” has the meaning ascribed to such term under “ General Development and Business of the Company – Business of EverGen Infrastructure Corp. – Social and Environmental Policies ”.

“ Employment Agreement ” has the meaning ascribed to such term under “ Director and Executive Compensation – Termination and Change of Control Benefits ”.

“ Equity Incentive Plan ” means the stock option and other Equity Incentive Plan of the Company adopted by the Board on March 18, 2021, as amended from time to time.

“ ESG ” has the meaning ascribed to such term under “ General Development and Business of the Company – Business of EverGen Infrastructure Corp. – Leading the Development of Canada’s RNG Infrastructure ”.

“ EverGen ” or the “ Company ” means EverGen Infrastructure Corp., a company formed under the laws of British Columbia.

“ Exercise Deadline ” means July 19, 2021.

“ Expiry Date ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Finder ” has the meaning ascribed to such term on under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Finder Compensation Options ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Finder Warrant Shares ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Finder Warrants ” has the meaning ascribed to such term on under “ General Development and Business of the Company – General Development of the Company – History ”.

“Finder Fee ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Significant Acquisitions ”.

“ forward-looking information ” has the meaning ascribed to such term under “ Statement Regarding ForwardLooking Information ”.

“ FVB ” means Fraser Valley Biogas Ltd., a corporation existing under the BCBCA and a wholly owned subsidiary of EverGen.

“ FVB Acquisition ” has the meaning ascribed to it under “ General Development and Business of the Company – General Development of the Company – Other Business Acquisition – Fraser Valley Biogas Ltd. ”.

“ FVB Project ” has the meaning ascribed to it under “ Prospectus Summary – EverGen Infrastructure Corp. – Overview of the Company ”.

“ FVB Purchase Agreement ” has the meaning ascribed to it under “ General Development and Business of the Company – General Development of the Company – Other Business Acquisition – Fraser Valley Biogas Ltd. ”.

“ GAS PSUs ” has the meaning ascribed to such term under “ Options to Purchase Securities – PSUs ”.

“ GHG ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – Industry Overview and Competitive Conditions ”.

“ Heppell ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Other Business Acquisition – Fraser Valley Biogas Ltd. ”.

“ HHV ” has the meaning ascribed to such term under “ General Development and Business of the Company – Business of EverGen Infrastructure Corp. – Industry Overview and Competitive Conditions – Overview of Biogas and RNG ”.

“ Holder ” has the meaning ascribed to such term under “ Certain Canadian Federal Income Tax Considerations ”.

“ Human Resources and Compensation Committee ” means the Human Resources and Compensation Committee of the Board.

“ IEA ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – Industry Overview and Competitive Conditions ”.

“ IFRS ” means the International Financial Reporting Standards as issued by the International Accounting Standards Board (“IASB”) and the interpretations thereof by the International Financial Reporting Interpretations Committee and the former Standing Interpretations Committee.

“ Investor Relations Activities ” has the meaning assigned by TSX-V Policy 1.1 – Interpretation .

“ Land ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Other Business Acquisition – Fraser Valley Biogas Ltd. ”.

“ Listing Date ” means the date that the Common Shares (including the Unit Shares, the Warrant Shares, the Special Warrant Unit Shares, the Special Warrant Shares, the Broker Unit Shares and the Broker Warrant Shares) are listed on the TSX-V.

“ MD&A ” means management’s discussion and analysis of financial condition and operating results.

“ Metro Vancouver ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – The SSS Project ”.

“ Metro Vancouver Contract ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – The SSS Project ”.

“ Mtoe ” means million tonnes of oil equivalent.

“ Named Executive Officer ” or “ NEO ” has the meaning ascribed to such term in NI 51-102.

“ NI 41-101 ” means National Instrument 41-101 – General Prospectus Requirements .

“ NI 51-102 ” means National Instrument 51-102 – Continuous Disclosure Obligations .

“ NI 52-110 ” means National Instrument 52-110 – Audit Committees .

“ Non-Brokered Private Placement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Non-resident Holder ” has the meaning ascribed to such term under “ Certain Canadian Federal Income Tax Considerations ”.

“ NP 46-201 ” means National Policy 46-201 – Escrow for Initial Public Offerings .

“ NZI ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Significant Acquisitions – Net Zero Waste Abbotsford Inc. ”.

“ NZI Consulting Agreement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Significant Acquisitions – Consulting Agreement ”.

“ NZWA ” means Net Zero Waste Abbotsford Inc., a corporation existing under the BCBCA and a wholly owned subsidiary of EverGen.

“ NZWA Acquisition ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Significant Acquisitions – Net Zero Waste Abbotsford Inc. ”.

“ NZWA Project ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – Overview of the Company ”.

“ NZWA Purchase Agreement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Significant Acquisitions – Net Zero Waste Abbotsford Inc. ”.

“ Offered Units ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Offering ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Offering Lock-Up Agreements ” has the meaning ascribed to such term under “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer – Other Contractual Restrictions ”.

“ Offering Price ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ OMRR ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – The SSS Project ”.

“ Option ” means an option of the Company to purchase a Common Share issued pursuant to the Equity Incentive Plan.

“ Order ” has the meaning ascribed to such term under “ Directors and Executive Officers – Cease Trade Orders, Bankruptcies, Penalties or Sanctions ”.

“ Original Investor Presentation ” has the meaning ascribed to such term under “ Marketing Materials ”.

“ Original Term Sheet ” has the meaning ascribed to such term under “ Marketing Materials ”.

“ Over-Allotment Deadline ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Over-Allotment Option ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Over-Allotment Securities ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Over-Allotment Shares ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Over-Allotment Units ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Over-Allotment Warrants ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Participants ” has the meaning ascribed to such term under “ Options to Purchase Securities – Equity Incentive Plan ”.

“ Pela ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Other Business Acquisition – Fraser Valley Biogas Ltd. ”.

“ Preferred Shares ” has the meaning ascribed to such term under “ Description of Securities Being Distributed ”.

“ Predecessor Entities ” means NZWA and SSS.

“ President’s List ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Principal ” has the meaning ascribed to such term under NP 46-201.

“ Prospectus ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Prospectus Automatic Exercise Date ” means the date which is the third business day following the Qualification Date, if applicable, and provided that such date is on or prior to the Exercise Deadline.

“ PSU ” means a performance share unit of the Company which is convertible into a Common Share pursuant to the PSU Plan.

“ PSU Plan ” means the performance share unit plan adopted by the Company on December 30, 2020.

“ Qualification Date ” means the date on which the Company has obtained a receipt for the (final) long prospectus of the Company from the British Columbia Securities Commission, as principal regulator, qualifying the distribution of the Special Warrant Units in the Qualifying Jurisdictions.

“ Qualifying Jurisdictions ” means each of the provinces of Canada.

“ RBC ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Reddick Wellington ” means Reddick Wellington Investments Inc., a principal shareholder of the Company.

“ Registered Plan ” has the meaning ascribed to such term under “ Eligibility For Investment ”.

“ Regulations ” has the meaning ascribed to such term under “ Certain Canadian Federal Income Tax Considerations ”.

“ Resident Holder ” has the meaning ascribed to such term under “ Certain Canadian Federal Income Tax Considerations – Resident Holders ”.

“ Revised Investor Presentation ” has the meaning ascribed to such term under “ Marketing Materials ”.

“ Revised Term Sheet ” has the meaning ascribed to such term under “ Marketing Materials ”.

“ RNG ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Roynat Credit Facility ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ RSU ” means a restricted share unit of the Company which is convertible into Common Shares, cash payment or a combination of Common Shares and a cash payment, issued pursuant to the Equity Incentive Plan.

“ Safety and Sustainability Committee ” means the Safety and Sustainability Committee of the Board.

“ SEDAR ” means the System for Electronic Document Analysis and Retrieval.

“ Special Warrant ” means a previously issued special warrant of the Company pursuant to the Special Warrant Financing.

“ Special Warrant Agents ” means Desjardins and Clarus, who acted as agents in connection with the Special Warrant Financing.

“ Special Warrant Financing ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Special Warrant Indenture ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Special Warrant Share ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Special Warrant Unit Share ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Special Warrant Unit Warrant ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History” .

“ Special Warrant Units ” means up to 1,059,325 units of the Company issuable upon: (i) the automatic exercise of Special Warrants on the Automatic Exercise Date, or (ii) the voluntary exercise of any Special Warrants prior to the Automatic Exercise Date, as applicable, with each such unit comprised of one Special Warrant Unit Share and one half of one Special Warrant Unit Warrant.

“ SSS ” means Sea to Sky Soils and Composting Inc., a corporation existing under the BCBCA and a wholly owned subsidiary of EverGen.

“ SSS Acquisition ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Significant Acquisitions – Sea to Sky Soils and Composting Inc. ”.

“ SSS Project ” has the meaning ascribed to such term under “ Prospectus Summary – EverGen Infrastructure Corp. – Overview of the Company ”.

“ SSS Purchase Agreement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – Significant Acquisitions – Sea to Sky Soils and Composting Inc. ”.

“ Subscription Receipt Agreement ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Subscription Receipts ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Subscription Receipt Financing ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Syngas ” has the meaning ascribed to such term under “ General Development and Business of the Company – Business of EverGen Infrastructure Corp. – Industry Overview and Competitive Conditions – Overview of Biogas and RNG ”.

“ Tax Act ” means the Income Tax Act (Canada), as amended from time to time.

“ TSX-V ” has the meaning ascribed to such terms on the third cover page of this Prospectus.

“ TSX-V Policy 5.4 ” means TSX-V Policy 5.4 – Escrow, Vendor Consideration and Resale Restrictions .

“ Underlying Share ” has the meaning ascribed to such term under “ General Development and Business of the Company – General Development of the Company – History ”.

“ Underwriters ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Underwriters’ Fee ” has the meaning ascribed to such term on the second cover page of this Prospectus.

“ Underwriting Agreement ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Unit Share ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ United States ” means the United States of America, its territories and possessions, any state of the United States and the District of Columbia.

“ U.S. Securities Act ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ U.S. Treaty ” has the meaning ascribed to such term under “ Certain Canadian Federal Income Tax Considerations –Non-Resident Holders – Dividends ”.

“ US dollars ” or “ US$ ” means the currency of the United States.

“ Voluntary Hold Periods ” has the meaning ascribed to such term under “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer – Voluntary Hold Periods ”.

“ Voluntary Lock-Up Agreements ” has the meaning ascribed to such term under “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer – Other Contractual Restrictions ”.

“ Warrant ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Warrant Indenture ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Warrant Share ” has the meaning ascribed to such term on the cover page of this Prospectus.

“ Whistleblower Policy ” means the Whistleblower Policy of the Company adopted by the Board on March 18, 2021.

ABOUT THIS PROSPECTUS

An investor should rely only on the information contained in this Prospectus and is not entitled to rely on parts of the information contained in this Prospectus to the exclusion of others. The Company has not, and the Underwriters have not, authorized anyone to provide investors with additional, different or inconsistent information. If anyone provides investors with additional, different or inconsistent information, including information or statements in media articles about the Company, investors should not rely on it.

The information contained in this Prospectus is accurate only as of the date of this Prospectus or the date indicated, regardless of the time of delivery of this Prospectus or any sale of the Offered Units. The Company’s business, financial condition, operating results and prospects may have changed since the date of this Prospectus.

The Company and the Underwriters are not offering to sell the Offered Units in any jurisdiction where the offer or sale of such securities is not permitted. For investors outside the Qualifying Jurisdictions, neither the Company nor the Underwriters have done anything that would permit the Offering or possession or distribution of this Prospectus in any jurisdiction where action for that purpose is required, other than in the Qualifying Jurisdictions. Investors are required to inform themselves about, and to observe any restrictions relating to, the Offering and the possession or distribution of this Prospectus.

The information contained on the Company’s corporate website is not intended to be included in or incorporated by reference into this Prospectus and investors should not rely on such information when deciding whether or not to invest in the Offered Units.

Any graphs, tables or other information demonstrating the historical performance or current or historical attributes of the Company or any other entity contained in this Prospectus are intended only to illustrate historical performance or current or historical attributes of the Company or such entities and are not necessarily indicative of future performance of the Company or such entities.

This Prospectus includes summary descriptions of certain material agreements of the Company (see “ Material Contracts ”). The summary descriptions disclose provisions that the Company considers to be material, but are not complete and are qualified by reference to the terms of the material agreements, which will be filed with the Canadian securities regulatory authorities and will be available under the Company’s profile on SEDAR at www.sedar.com. Investors are encouraged to read the full text of such material agreements.

MEANING OF CERTAIN REFERENCES

Unless otherwise noted or the context otherwise indicates, “EverGen” or the “Company” refers to EverGen Infrastructure Corp. and the Acquired Businesses, Net Zero Waste Abbotsford Inc., Sea to Sky Soils and Composting Inc. and Fraser Valley Biogas Ltd., as constituted on the date of this Prospectus.

STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This Prospectus contains “forward-looking information” and “forward-looking statements” (collectively, “ forwardlooking information ”) within the meaning of applicable Canadian securities laws which are based upon the Company’s current internal expectations, estimates, projections, assumptions and beliefs and views of future events. Forward-looking information includes statements that use forward-looking terminology such as “may”, “could”, “would”, “will”, “should”, “intend”, “target”, “plan”, “expect”, “estimate”, “forecast”, “schedule”, “anticipate”, “believe”, “continue”, “potential”, “view” or the negative or grammatical variation thereof or other variations thereof or comparable terminology. Such forward-looking information includes, without limitation, statements with respect to: the Offering and the terms and anticipated timing thereof, including the anticipated receipt of all regulatory and stock exchange approvals, including approval of the TSX-V; the qualification of the Offered Units under this Prospectus and the anticipated timing thereof; the potential for the Underwriters to over-allot or effect market stabilization transactions in respect of the Offered Units; the estimated net proceeds of the Offering; the intended use of the net proceeds of the Offering and Over-Allotment Option, if any, and the other funds of the Company, including for the purpose of identifying and acquiring new RNG Projects and other potential acquisition or

investment opportunities; the listing of the Common Shares (including the Unit Shares, the Warrant Shares, the Special Warrant Unit Shares, the Special Warrant Shares, the Broker Unit Shares and the Broker Warrant Shares) on the TSX-V; the performance of the Company’s business and operations, including its ability to continue as a going concern; the ability of the Company to execute on its mission, strategy, goals and primary business objectives; the Company’s view that it may become engaged in discussions and negotiations with respect to future potential acquisition or investment opportunities; adequacy of funds from the Offering to support the Company’s business objectives; the Offered Units, or the components of the Offered Units, being “qualified investments” under the Tax Act and the Regulations; entering into lock-up agreements with existing securityholders of the Company in respect of the Offering and the estimated number of securities that will be subject to such lock-up agreements; the expectation that certain of the Common Shares and securities convertible into Common Shares will be subject to escrow restrictions or contractual restrictions on transfer upon completion of the listing of the Common Shares on the TSX-V; plans regarding the Company’s compensation policy and practices; plans regarding the future composition of the Board; the primary business objectives the Company expects to accomplish by using the net proceeds from the Offering and other funds available to it over the next 18 months; the estimated operating costs required to meet the Company’s objectives; additional sources of funds that are anticipated to be secured by the Company; the Company’s projections regarding market demand for its products and services; anticipated trends, opportunities, growth rates and challenges in the Company’s business and the markets in which it operates; the belief that the Company is uniquely positioned to consolidate a portfolio of fragmented projects and achieve scale on an accretive basis; the Company’s expectation that it will manage multiple operational RNG projects by 2023; the Company’s competitive position and the environment in which it operates, including opportunities for market expansion; anticipated trends and challenges in the Company’s business and the market in which it operates, such as growing circular economy expectations regarding organics diversion rates; the Company’s belief that it has identified a strong pipeline of potential RNG projects and acquisition opportunities; the Company’s belief that its market, industry and economic data are accurate and that its estimates and assumptions are reasonable; the expectation to produce renewable energy and reduce GHG (as defined below) emissions; the Company’s intention to supply RNG primarily into the gas grid through the operation of RNG projects, including the intention to convert soil products into biogas via AD through its organics processing facilities; the expectation that RNG will be a key component in FortisBC achieving its target to reduce customers’ GHG emissions 30% by 2030 and achieving a 15% renewable low-carbon fuel supply by 2030 and 30% by 2050; the Company’s plans to become the dominant supplier of RNG to FortisBC, and expand its operations in North America, including actively pursuing project clusters similar to the one in British Columbia in the provinces of Alberta, Ontario and Québec; the expected capitalization on incoming organic waste streams, proximal commercial feedstock and nearby tie-in to pipeline infrastructure resulting from NZWA’s offtake agreement with FortisBC; the expectation that the terms of NZWA’s offtake agreement will receive final approval from the British Columbia Utilities Commission and other regulatory authorities; the expectation that the Company can replace any lost revenue from the Metro Vancouver Contract (as defined below); the expectation that the SSS Project (as defined below) will serve as a source of feedstock for existing and future RNG (as defined below) operations; the Company’s plans to expand and enhance the FVB Project (as defined below) and boost RNG production; the Company’s plans to design, build, own, and operate facilities, and based on securing long-term offtake contracts, convert the organics into RNG, soil products and fertilizer; increasing processing capabilities at existing facilities, optimizing existing operations, and expanding partnerships with municipal and commercial waste streams; the Company’s target of producing approximately 2,822 GJ/day of RNG across a portfolio of six projects by 2024; the Company’s expected realization on societal and local changes in policies, programs and demand for more waste recycling and RNG production; continued growth of the project portfolio; the belief that the FVB Acquisition (as defined below) will provide certain benefits to the Company, including some anticipated cost synergies; and any other statement that may predict, forecast, indicate or imply future plans, intentions, levels of activity, results, performance or achievements.

Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management in light of management’s experience and perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances, as of the date of this Prospectus including, without limitation, assumptions about: general economic trends; favourable equity and debt capital markets; the ability to raise any necessary additional capital on reasonable terms to advance the Company’s businesses; requirements under applicable laws; legislative and regulatory environments in Canada with respect to RNG; availability of organic and food waste; the Company’s ability to maintain and expand on any existing RNG operational contracts; the Company’s ability to acquire and retain key personnel; and the Company’s plans regarding social and environmental policies and practices. While the Company

considers these assumptions to be reasonable, the assumptions are inherently subject to significant business, social, economic, political, regulatory, competitive and other risks and uncertainties, contingencies and other factors that could cause actual actions, events, conditions, results, performance or achievements to be materially different from those projected in the forward-looking information. Many assumptions are based on factors and events that are not within the control of the Company and there is no assurance they will prove to be correct.

Furthermore, such forward-looking information involves a variety of known and unknown risks, uncertainties and other factors which may cause the actual plans, intentions, activities, results, performance or achievements of the Company to be materially different from any future plans, intentions, activities, results, performance or achievements expressed or implied by such forward-looking information. Such risks include, without limitation:

operational risks;
environmental risks;
regulatory risks, including changes to national and local legislation;
reliance on permits and authorizations and delays in receiving such permits and authorizations;
the Company’s renewable gas infrastructure platform may fail performance expectations;
the Company’s commercial success depends on its ability to develop and operate individual renewable energy projects;
demand for renewable energy;
the Company’s renewable energy projects may not generate expected levels of output;
dependence on two current projects for operating revenues;
relationship with customers/suppliers;
feedstock and re-contracting risk;
the Company’s insurance coverage may be inadequate to cover potential losses;
maintaining lease agreements;
managing growth;
retention and acquisition of skilled personnel;
the directors and officers may have conflicts of interest with the Company;
economic and market conditions;
potential acquisition and investment opportunities;
future acquisitions may require significant expenditures and may result in inadequate returns;
issuance of debt and levels of indebtedness;
estimates or judgments relating to critical accounting policies;
historical and pro forma consolidated financial information may not be representative of the Company’s results as a combined entity;
cyberattacks may cause disruptions to the Company’s operations and could have a material effect on its business;
the Company may be subject to costly legal proceedings;
the Company will incur increased costs as a result of complying with the reporting requirements, rules and regulations affecting public issuers;
COVID-19 may further disrupt the business of the Company;
global financial conditions can reduce the price of the Common Shares;
it may be difficult to enforce judgments and effect service of process on a certain director;
general risks relating to the FVB Acquisition;
integration of FVB’s business;
possible failure to realize anticipated benefits of the FVB Acquisition;
possible failure to achieve the full amount of anticipated cost synergies;
investors may lose their entire investment;
there is no existing public market for the Common Shares or the Warrants;
the Warrants will not be listed for trading;
the Company may not use the proceeds from the Offering and other available funds as described in this Prospectus;

the Company will require other available funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations;
dilution from equity financing could negatively impact holders of Offered Units;
equity securities are subject to trading and volatility risks;
sales by existing shareholders can reduce share prices;
the Company is not likely to pay dividends for an extended period of time;
Warrant holders will not have shareholder rights;
public companies are subject to securities class action litigation risk; and
if securities or industry analysts do not publish research or publish inaccurate or unfavourable research about the Company’s business, the price and trading volume of the Common Shares could decline.

Although the Company has attempted to identify important factors that could cause actual actions, events, conditions, results, performance or achievements to differ materially from those described in forward-looking information, there may be other factors that cause actions, events, conditions, results, performance or achievements to differ from those anticipated, estimated or intended. If any of these risks or uncertainties materialize, or if assumptions underlying the forward-looking statements prove incorrect, actual results might vary materially from those anticipated in those forward-looking statements. See “ Risk Factors ” for a discussion of certain factors investors should carefully consider before deciding to invest in the Offered Units.

The Company cautions that the foregoing lists of important assumptions and factors are not exhaustive and should be read together with the other cautionary statements in this Prospectus. Other events or circumstances could cause actual results to differ materially from those estimated or projected and expressed in, or implied by, the forward-looking information contained herein. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information.

To the extent any forward-looking statement in this Prospectus constitutes “future-oriented financial information” or “financial outlooks” within the meaning of applicable Canadian securities laws, such information is being provided to demonstrate the anticipated market penetration and the reader is cautioned that this information may not be appropriate for any other purpose and the reader should not place undue reliance on such future-oriented financial information and financial outlooks. Future-oriented financial information and financial outlooks, as with forward-looking statements generally, are, without limitation, based on the assumptions and subject to the risks set out above. The Company’s actual financial position and results of operations may differ materially from management’s current expectations and, as a result, the Company’s revenue and expenses may differ materially from the revenue and expenses profiles provided in this Prospectus. Such information is presented for illustrative purposes only and may not be an indication of the Company’s actual financial position or results of operations.

Forward-looking information contained herein is made as of the date of this Prospectus and the Company disclaims any obligation to update or revise any forward-looking information, whether as a result of new information, future events or results or otherwise, except as and to the extent required by applicable securities laws.

EXCHANGE RATE AND CURRENCY INFORMATION

The following table sets forth, for each period indicated, the exchange rate of the Canadian dollar to the US dollar at the end of such period and the average, high and low exchange rates for such period (such rates, which are expressed in Canadian dollars, are based on the daily exchange rate for US dollars reported by the Bank of Canada).

	Three months ended March 31,	Year ended December 31, 2020
	2021 ($)	($)
Low for the period	1.2455	1.2718
High for the period	1.2828	1.4496
Rate at the end of the period	1.2575	1.2732
Average rate for the period	1.2660	1.3415

On July 8, 2021, the last business day before the date of this Prospectus, the Bank of Canada daily exchange rate for the purchase of one US dollar using Canadian dollars was $1.2540 ($1.00 = US$0.7974).

All dollar amounts in this Prospectus are expressed in Canadian dollars, except as otherwise indicated. References to “$” or “dollars” are to Canadian dollars, references to “US$” are to US dollars. The Company presents its financial statements in Canadian dollars.

ENFORCEMENT OF JUDGMENTS AGAINST FOREIGN PERSONS

A director of the Company resides outside of Canada. The person named below has appointed the following agent for service of process:

Name of Person Name and Address of Agent

Jon Ozturgut, Director

Borden Ladner Gervais LLP, Waterfront Centre, 200 Burrard Street, Suite 1200, Vancouver, British Columbia V7X 1T2

Purchasers are advised that it may not be possible for investors to enforce judgments obtained in Canada against any person or company that is incorporated, continued or otherwise organized under the laws of a foreign jurisdiction or resides outside of Canada, even if the party has appointed an agent for service of process. See “ Risk Factors ”.

THIRD PARTY INFORMATION

This Prospectus includes market, industry and economic data which was obtained from various publicly available sources and other sources believed by the Company to be true. Although the Company believes it to be reliable, neither the Company nor the Underwriters have independently verified any of the data from third party sources referred to in this Prospectus, or analyzed or verified the underlying reports relied upon or referred to by such sources, or ascertained the underlying economic and other assumptions relied upon by such sources. The Company believes that its market, industry and economic data are accurate and that its estimates and assumptions are reasonable, but there can be no assurance as to the accuracy or completeness thereof. The accuracy and completeness of the market, industry and economic data used throughout this Prospectus are not guaranteed and the Company and the Underwriters do not make any representation as to the accuracy or completeness of such information.

MARKETING MATERIALS

A “template version” of the following “marketing materials” (as such terms are defined in NI 41-101) have been filed with the securities commissions or similar regulatory authorities in each of the provinces of Canada, and are specifically incorporated by reference into this Prospectus: (i) the investor presentation dated May 5, 2021 (the “ Original Investor Presentation ”), (ii) the revised investor presentation dated July 9, 2021 (the “ Revised Investor Presentation ”); (iii) the term sheet dated May 5, 2021 (the “ Original Term Sheet ”), and (iv) the revised term sheet dated July 9, 2021 (the “ Revised Term Sheet ”).

The Revised Term Sheet and Revised Investor Presentation have revised information contained in the Original Term Sheet and the Original Investor Presentation, respectively, to reflect, among other things, the final Offering Price of $6.50, a change to the offering of Common Shares to an offering of Offered Units, the aggregate number of Offered Units to be issued of 3,080,000 (3,542,000 if the Over-Allotment Option is exercised in full), the aggregate size of the Offering of $20,020,000 ($23,023,000 if the Over-Allotment Option is exercised in full), the number of Common Shares issued and outstanding upon completion of the Offering and the deemed exercise of Special Warrants is 13,367,392 (13,829,392 if the Over-Allotment Option is exercised in full), the use of proceeds allocation, the current status of the listing application with the TSX-V, the anticipated Closing Date and the financial results and balance sheet information to include the interim period ended March 31, 2021.

All of the foregoing revisions are reflected in this Prospectus and pursuant to subsection 13.7(7) of NI 41-101, revised template versions of the marketing materials which have been blacklined to show the modified information have been filed under the Company’s SEDAR profile at www.sedar.com.

In addition, any such template version of marketing materials are not part of this Prospectus to the extent that the contents of the template version of marketing materials have been modified or superseded by a statement contained in this Prospectus. Any template version of marketing materials filed under the Company’s profile on SEDAR after the date of this Prospectus and before the termination of the distribution under the Offering (including any amendments to, or an amended version of, any template version of any marketing materials) will be deemed to be incorporated into this Prospectus.

NON-IFRS MEASURES

Financial results of the Company are prepared in accordance with IFRS. The Company utilizes certain non-IFRS measures such as “working capital”, “EBIDTA”, “Adjusted EBITDA” and “operating profit”. The Company believes that these measures, together with measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company. Non-IFRS measures do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Working Capital

Working capital is determined based on current assets and current liabilities as reported in the Company’s consolidated financial statements. The Company uses working capital as a measure of the Company’s short-term financial health and operating efficiency. The following table provides a calculation of working capital based on amounts of the current assets and current liabilities presented in the Company’s financial statements as at December 31, 2020.

($000s)	December 31, 2020
Current assets	6,979
Less: Current liabilities	(9,821)
Working capital deficit(1)	(2,842)

Note:

(1) Working capital is the measure of current assets less current liabilities and is a non-IFRS measure. See “ Non-IFRS Measures ”.

Subsequent to December 31, 2020, EverGen entered the Roynat Credit Facility (as defined herein) providing for a senior secured term loan with available funds of up to $7,000,000 repayable over 3 years, and completed the Special Warrant Financing for gross proceeds of $8,474,600. Combined, this provided EverGen with $15,474,600 in additional liquidity. The following table provides a calculation of working capital based on amounts of the current assets and current liabilities presented in the Company’s unaudited consolidated financial statements as at March 31, 2021.

($000s)	March 31, 2021
Current assets	18,827
Less: Current liabilities	(7,248)
Working capital surplus(1)	11,579

Notes:

(1) Working capital is the measure of current assets less current liabilities and is a non-IFRS measure. See “Non-IFRS Measures”.

EBITDA and Adjusted EBITDA

Management considers EBITDA and Adjusted EBITDA as key metrics in analyzing operational performance and the Company’s, NZWA’s and SSS’s ability to generate cash flow. EBITDA is measured as net income (loss) before interest, tax, depreciation and amortization. Adjusted EBITDA is measured as EBITDA adjusted for share-base payment expense and unusual or non-recurring items. The Company treats EBITDA and Adjusted EBITDA as key

measures of liquidity and the management of capital resources. For a reconciliation of the Company’s EBITDA and Adjusted EBITDA, please refer to pages “F-28” to “F-29” and “F-142” of the MD&A attached to this Prospectus.

Operating Profit

Operating profit is measured as gross profit, an additional subtotal found in the statement of net income and comprehensive net income, less operating costs and general and administrative expenses. Management considers operating profit to evaluate the efficiency of the Company’s, NZWA’s and SSS’s operations and considers it to be a key measure of profitability. For a reconciliation of the Company’s operating profit, please refer to pages “F-29” to “F-30” and “F-142” of the MD&A attached to this Prospectus.

ELIGIBILITY FOR INVESTMENT

In the opinion of Borden Ladner Gervais LLP, counsel to the Company, and Cassels Brock & Blackwell LLP, counsel to the Underwriters, based on the current provisions of the Tax Act and the Regulations, a Unit Share, Warrant and Warrant Share offered hereunder will be a “qualified investment” under the Tax Act and the Regulations for a trust governed by a “registered retirement savings plan”, a “registered retirement income fund”, a “registered education savings plan”, a “registered disability savings plan”, a “tax-free savings account” (each one a “ Registered Plan ”), or a “deferred profit sharing plan” (as those terms are used in the Tax Act), provided that:

in the case of the Unit Shares and Warrant Shares, the Unit Shares and Warrant Shares are listed on a “designated stock exchange” as defined in the Tax Act (which currently includes the TSX-V) when such shares are acquired; and
in the case of the Warrants, the Warrant Shares are qualified investments as described above and neither the Company, nor any person with whom the Company does not deal at arm’s length for the purposes of the Tax Act, is an annuitant, a beneficiary, an employer or a subscriber under, or a holder of, the particular Registered Plan or deferred profit sharing plan.

The Unit Shares and Warrant Shares are not currently listed on a designated stock exchange. The Company has applied to list the Unit Shares and Warrant Shares on the TSX-V as of the day before the Closing, followed by an immediate halt in trading of the Unit Shares and Warrant Shares to allow the Company to satisfy the conditions of the TSX-V and to have the Unit Shares and Warrant Shares listed and posted for trading prior to the issuance of the Offered Units on Closing. The Company must rely on the TSX-V to list the Unit Shares and Warrant Shares on the TSX-V and have them posted for trading prior to the issuance of the Offered Units on Closing, and to otherwise proceed in such manner as may be required to result in the Unit Shares and Warrant Shares being listed on the TSX-V at the time of the issuance of Offered Units on Closing. If the Unit Shares and Warrant Shares are not listed on the TSX-V at the time of the issuance of Offered Units on Closing, the Unit Shares, Warrant Shares and Warrants will not be qualified investments for a Registered Plan or deferred profit sharing plan at that time.

Notwithstanding that a Unit Share, Warrant or Warrant Share may be a qualified investment for a Registered Plan, if the Unit Share, Warrant or Warrant Share is a “prohibited investment” within the meaning of the Tax Act for a Registered Plan, the annuitant, holder, or subscriber of the Registered Plan, as the case may be (the “ Controller ”) will be subject to a penalty tax as set out in the Tax Act. A Unit Share, Warrant and Warrant Share will generally not be a prohibited investment for a Registered Plan if the Controller:

deals at arm’s length with the Company for the purposes of the Tax Act, and
does not have a “significant interest” (as defined in the Tax Act) in the Company.

Generally, a Controller of a Registered Plan will not have a “significant interest” in the Company unless the Controller owns, directly or indirectly, 10% or more of the outstanding shares of any class of the Company or any corporation related to the Company, either alone or together with persons with which the Controller does not deal at arm’s length for the purposes of the Tax Act. In addition, a Unit Share or Warrant Share will not be a “prohibited investment” if the security is “excluded property” as defined in the Tax Act for the Registered Plan.

Purchasers of Offered Units should consult their own tax advisers with respect to whether Unit Shares, Warrants and Warrant Shares would be prohibited investments having regard to their particular circumstances.

PRESENTATION OF FINANCIAL INFORMATION AND ACCOUNTING PRINCIPLES

The Company presents its financial statements in Canadian dollars. The following statements of the Company and the Predecessor Entities have been prepared in accordance with IFRS or using policies consistent with IFRS and are included in this Prospectus. The financial statements of the Company as at March 31, 2021 for the three-month period then ended are unaudited and have been prepared in accordance with International Accounting Standards No. 34, Interim Financial Reporting and in accordance with IFRS. See “ Index to Financial Statements and Management’s Discussion & Analysis ”.

Consolidated MD&A of the Company and of the Predecessor Entities for the period from incorporation on May 13, 2020 to December 31, 2020, and for the years ended December 31, 2020 and 2019, respectively;
Audited consolidated financial statements of the Company as at December 31, 2020, for the period of incorporation on May 13, 2020 to December 31, 2020;
Audited financial statements of NZWA as at December 31, 2020 and 2019, for the years ended December 31, 2020 and 2019;
Audited financial statements of SSS as at December 31, 2020 and 2019, for the years ended December 31, 2020 and 2019;
Consolidated MD&A of the Company for the three-month period ended March 31, 2021;
Unaudited consolidated interim financial statements of the Company as at and for the three-month period ended March 31, 2021; and
Pro forma consolidated financial statements of the Company, as at December 31, 2020, which give effect to the Acquisitions of the Predecessor Entities, as if such Acquisitions had taken place on January 1, 2020 for the year ended December 31, 2020.

PROSPECTUS SUMMARY

The following is a summary of the principal features of the Offering and is qualified in its entirety by, and should be read together with, the more detailed information, financial data and statements and MD&A contained elsewhere in this Prospectus. This summary does not contain all of the information a potential investor should consider before investing in the Offered Units. Please refer to the “Glossary” for a list of defined terms used herein.

EverGen Infrastructure Corp.

Overview of the Company

EverGen Infrastructure Corp. was incorporated under the BCBCA on May 13, 2020. EverGen is a non-reporting issuer in British Columbia, focused entirely on contributing to the circular economy in recycling waste and establishing a renewable gas infrastructure platform with the strategy of acquiring, developing, building, owning and operating a portfolio of RNG, waste to energy, and related sustainable infrastructure projects in British Columbia. The Company’s principal business activities since incorporation have been the acquisitions of NZWA, SSS and FVB and the operation of the Predecessor Entities, and most recently of FVB. The assets and activities of the Predecessor Entities constitute a majority of the assets and activities disclosed by the Company’s financial statements contained in this Prospectus. NZWA owns and operates a food, green and agricultural waste commercial composting facility in the City of Abbotsford, British Columbia (the “ NZWA Project ”). SSS owns and operates an organic waste commercial composting facility hosted by and leased from the Lil’wat Nation in the Village of Pemberton, British Columbia (the “ SSS Project ”). Additionally, EverGen owns and operates a biogas production facility in the City of Abbotsford through FVB (the “ FVB Project ”). The NZWA Project and the SSS Project are currently considered to be the only material projects of the Company.

EverGen applies an infrastructure model and is committed to minimizing risk on a fully integrated basis. EverGen’s infrastructure approach is based on (i) securing long term contracts with respect to its feedstock inputs (long-term municipal contracts) as well as RNG outputs (FortisBC offtake), (ii) proven AD technology which is commonly used in the European market, and (iii) executing on its development model through its network of strategic partnerships and committed stakeholders.

The strategy of EverGen is to develop, own, and operate RNG projects using proven technologies and intends to supply RNG primarily into the gas grid through the operation of RNG projects. EverGen also develops, owns, and operates organics processing facilities which process municipal source separated organics and food waste under longterm contracts. See “ EverGen’s Strategy ” below. These organics are converted to soil products via composting and are intended to be converted to biogas via Anaerobic Digestion (“ AD ”). The biogas would then be upgraded to RNG and sold to gas utilities under long term contracts. EverGen’s projects are currently located in British Columbia, Canada, and the Company’s initial focus is to become the dominant supplier of RNG in the form of purified biomethane to FortisBC, the local gas utility, and later expand its operations in North America, including actively pursuing the development of project clusters similar to the one in British Columbia in the provinces of Alberta, Ontario and Québec.

FortisBC offers long-term (up to 20 years) fixed price RNG offtake arrangements, with the largest single arrangement in place being in excess of 2,500 GJ/day. FortisBC is transitioning from higher carbon energy sources to lower carbon sources by ramping up the deployment of RNG to achieve a 15% renewable low-carbon fuel supply by 2030 and 30% by 2050. In addition, FortisBC is also targeting a 30% reduction in GHG emissions by 2030. The program’s current price cap for purchasing RNG is up to $30/GJ for pipeline quality and purified biomethane with in-province projects prioritized for supply contracts. On August 27, 2020, the Company entered into a letter of intent with FortisBC in connection with a proposed offtake agreement, and on April 23, 2021, the Company entered into a conditional offtake agreement with FortisBC, the terms of which remain subject to, among other things, final approval from the British Columbia Utilities Commission. See “ NZWA Project ” below. The Company also has an offtake agreement with FortisBC on the FVB Project. See “ FVB Project ” below.

Landfill gas is a viable source of biogas, which provides most of the potential for RNG generation in British Columbia. Biogas is generated from AD systems and EverGen secures feedstocks for its projects through long-term “green bin” municipal contracts, food waste, food processing residuals and from commercial and agricultural sources. Once longterm feedstock rights are secured, the Company intends to design, build, own, and operate facilities, and based on securing long-term offtake contracts, convert the organics into RNG, soil products and fertilizer. While soil products and fertilizer sales are expected make up a small portion of project revenue, their generation aids local businesses and farms, which in turn improves community support and sustainability.

Based on the Company’s analysis, there are numerous sources of waste organics, biogas and landfill gas in Canada and the United States that are generated close to natural gas utility infrastructure and could serve as potential future project opportunities. EverGen expects to realize on the societal and local changes in policies, programs and demand for more waste recycling and RNG production. EverGen is proactively engaging with local businesses, such as restaurants and food and beverage producers and distributors, to advance socially conscious commerce, to create mutually beneficial and socially responsible alternatives to traditional waste disposal and to achieve a reduced carbon footprint. EverGen expects to continue its growth through optimization of its current project portfolio, securing developments and acquiring new projects, all while pursuing vertical integration opportunities. Successful evaluation and execution of project opportunities is based on EverGen’s ability to leverage its significant industry experience and relationships with customers and vendors that ensure the economic viability of opportunities EverGen pursues. The Company exercises financial discipline through an infrastructure model in pursuing these projects by targeting project returns that are in line with the relative risk of the specific project. These relationships represent a significant area of growth and diversification from EverGen’s existing customer base and provide the opportunity for market expansion while fulfilling expectations of directing organic waste for recycling and the production of renewable energy.

Market Opportunity

Gas utilities have increased their focus on decarbonization. For example, FortisBC’s goal of 15% RNG deployment by 2030 (and 30% RNG deployment by 2050) provides a unique opportunity for EverGen to establish a world class RNG platform. FortisBC’s program alone can provide potential contracted revenues of ~$16bn for infrastructure developers over 20 years via fixed price RNG contracts. Other North American utilities are setting up similar goals.

Concurrently, the diversion of organics from landfills has also accelerated, and there is an opportunity to help Canada divert organic waste from landfills and incinerators. Organic waste diversion rates are growing significantly in North America as municipalities adopt landfill bans for organic materials that emit harmful greenhouse gas emissions. While landfill gas represents a significant portion of the RNG generated in North America currently, the largest opportunity for new RNG generation is via organics diverted from landfills and incinerators into anaerobic digesters that can produce RNG with lower carbon intensities. Landfill diversion also allows composting operations to be co-located with anaerobic digesters to facility nutrient recovery. The organic fertilizer and soil amendments can be sold as coproducts.

EverGen’s Competitive Advantage

First Mover Platform: Building on an Existing Local Footprint

EverGen’s platform approach to RNG means it can take on projects that are smaller than those traditionally sought after by large renewable infrastructure providers. The Company is technology agnostic, with a focus on risk adjusted cash-based returns. Unlike large wind and solar projects, each RNG project has its own unique attributes. By taking a platform approach, EverGen is able to diversify potential risks and maintain project returns that it believes will exceed other renewable projects. EverGen is able to leverage its experienced team and organic waste processing infrastructure to accelerate growth via brownfield project sites, existing relationships with municipal and commercial waste generators, and an established operational history with regulatory bodies.

Disciplined Execution & Operational RNG Expertise

The Company’s infrastructure-based approach means it evaluates each project on the strengths of the offtake, feedstock, construction and operational certainties and timing aspects. With a disciplined approach, the Company draws upon the experience of its management team, who have worked on 60 RNG projects worldwide to assist in derisking its technical assumptions, and its support team of experienced professionals with deep understanding of organics management and processing, operational experience of organic waste and anaerobic digestor facilities in Canada and expertise in environmental policy. The Company uses the waste management experience of its management team to understand and develop feedstock strategies, and its relationships to ensure EverGen is a quality partner for offtake agreements.

Positioned for Growth via Acquisitions & Partnerships

EverGen believes it has identified a strong pipeline of potential RNG projects and acquisition opportunities which includes a potential for conversions, optimization and new projects, all while pursuing vertical integration opportunities. The Company works collaboratively with smaller developers to deploy EverGen’s technical RNG experience, offtake & feedstock relationships, and disciplined financial expertise to advance projects from early stage to shovel-ready.

EverGen’s Strategy

It is EverGen’s purpose to contribute to the circular economy, promoting socially conscious business models for waste recycling while providing superior, sustainable returns for the planet by using its platform of investments and its operational excellence to drive rapid RNG grid conversion in addition to:

progressing the development and construction of existing portfolio of RNG expansion projects;
optimization, diversification and expansion of existing organic waste processing capabilities (RNG feedstock);
continuing the growth of its project portfolio via strategic acquisitions and consolidation opportunities; and
developing strategic partnerships and advance RNG project pipeline.

EverGen is advancing several projects, partnerships and acquisitions with a unique approach to support future growth. Active discussions with various parties are ongoing to expand its asset base. EverGen believes it is uniquely positioned to consolidate a portfolio of fragmented projects in the RNG sector and achieve scale on an accretive basis by applying its infrastructure approach. By 2023, EverGen expects to manage multiple operational RNG projects and maintain organic platform growth by applying a portfolio approach (to aggregate a diverse suite of anaerobic digestion/organics projects, landfill gas projects and municipal wastewater treatment plants) that focuses on multi-pronged targets (optimization, conversion and new infrastructure projects) with early, accretive cash flows.

EverGen currently owns and operates the NZWA Project, the SSS Project and most recently, the FVB Project. The Company’s revenue sources of tipping fees and sales of organic compost, soil products and RNG from these projects are expected to provide stable cash flows while the Company pursues its larger transition to RNG.

The NZWA Project

The NZWA Project is an operating compost facility with a development stage RNG project located on leased lands in Abbotsford, British Columbia. It generates stable cash flow from compost operations derived largely from municipal tipping fee-based long-term contracts. The NZWA Project is currently permitted to process up to 40,000 tonnes of compost per annum (with expectations to increase to 80,000 tonnes per annum) which, in addition to generating near term revenue, is expected to comprise a material portion of the feedstock for future RNG operations. The Company intends to increase the permitted tonnage of the facility in connection with the development of RNG operations. The Company is advancing RNG development at the NZWA Project. The NZWA Project will involve the construction and operation of an AD facility to be located at the site of existing operations. On August 27, 2020, NZWA entered into a letter of intent with FortisBC in connection with a proposed offtake agreement, and on April 23, 2021, NZWA entered into a conditional long-term offtake agreement with FortisBC pursuant to which FortisBC agreed to purchase a minimum of 130,000 GJ of RNG and up to 173,000 GJ of RNG per year from NZWA, at agreed upon specifications and a competitive base rate. The initial term of the offtake agreement is for 20 years and automatically renews for one

additional five (5) year term, unless an earlier notice of intention to terminate is provided by either party. The terms of the offtake agreement remain subject to, among other things, final approval from the British Columbia Utilities Commission. Upon the offtake agreement becoming an unconditional and binding agreement between the parties, NZWA expects to capitalize on the incoming organic waste streams, proximal commercial feedstock, and nearby tiein to pipeline infrastructure.

The SSS Project

The SSS Project is an operating compost facility located in Pemberton, British Columbia, on a site hosted by and leased from the Lil’wat Nation, and employs individuals from the Lil’wat Nation. The SSS Project has been conditionally approved for inclusion into the Squamish-Lillooet Regional District Solid Waste Management Plan. It previously generated cash flow primarily sourced from source separated organics from the Greater Vancouver Sewage and Drainage District (the “ Metro Vancouver ”) under an organic waste processing services contract that expired on June 30, 2021 (the “ Metro Vancouver Contract ”). During the year ended December 31, 2020, this contract accounted for 70 percent of SSS’s revenue. On April 16, 2021, EverGen was notified that the Metro Vancouver Contract (which had been the subject of a bid for proposal) had been awarded to another bidder. EverGen has identified additional sources of organic waste tonnage through a combination of long-term municipal contracts and shorter term merchant agreements (the “ Additional Agreements ”) and expects to replace any lost revenue from the Metro Vancouver Contract. The SSS Project currently processes approximately 25,000 tonnes per annum of organic waste inputs and is able to produce up to 5,000 tonnes per annum of dry “Class A compost” (as defined in the Organic Matter Recycling Regulation (the “ OMRR ”)) without requiring a permit under the OMRR. SSS is in the process of applying for such a permit under the OMRR in order to expand its design capacity to process up to 60,000 tonnes per annum of organic waste inputs and to increase its production of dry compost up to an expected 12,000 tonnes per annum. In addition to generating near and long-term revenue, this expansion in design capacity is expected to serve as a source of feedstock for existing and future RNG operations. The SSS Project is a recent recipient of a grant of $1.3 million (of which $765,000 was received by SSS) under the Organic Infrastructure Program, a program funded by the Government of Canada and the Province of British Columbia, related to the expansion of the organic waste facility.

The FVB Project

The FVB Project is an operating RNG facility located in Abbotsford, British Columbia. The FVB Project has been in operation since 2011 as the first RNG project in Western Canada. It is an AD facility which utilizes local agriculture and commercial food processing waste (currently 33,000 tonnes per annum with expectations to increase to 99,000 tonnes per annum) to generate RNG that is sold to FortisBC through an existing offtake agreement. The initial term of the offtake agreement expires on October 31, 2022 and automatically renews for additional two (2) year terms, unless an earlier notice of intention to terminate is provided by either party. The Company has initiated discussions with FortisBC to negotiate an extension following the initial term. The facility currently produces over 80,000 GJ of RNG annually (230 GJ/day) – enough to heat on average approximately more than 1,000 homes per year. EverGen plans to expand and enhance the project, with the intention to significantly boost RNG production by 2022 (up to an expected 167,000 GJ per annum).

See “ Corporate Structure ” and “ General Development and Business of the Company ”.

Industry Overview and Competitive Conditions

Renewable energy demand is significantly expanding outside of traditional electrical generation driven by a growing appreciation that efforts beyond electrification are needed to meet greenhouse gas (“ GHG ”) objectives and with a push by many gas utilities to renewable sources. Currently, the gas grid in North America has a market share of renewables of less than 1% by volume, with many utilities looking to achieve a target of 5-15% renewables by volume and with some utilities having mandates to reach such targets within certain specified time periods. At the same time, circular economy expectations are growing with organic waste diversion rates growing significantly in North America as municipalities adopt landfill bans for organic materials that emit harmful greenhouse gas emissions.

Gas Association. Nationally, the increased renewable gas content would result in 14 MT of GHG emission reductions per year by 2030, equivalent to removing 3.1 million passenger cars from the road.

The rise of RNG is not isolated to Canada alone, with policy support and feedstock availability driving additional supply and demand globally. Furthermore, while the industry is currently in its early stages, the potential to deliver clean energy to a wide array of end users using existing infrastructure is particularly attractive. Despite, RNG development being uneven across the globe, given feedstock availability and policies, with Europe, China and North America accounting for ~90% of global production, consumption is expected to materially increase from low levels in 2018 to approximately 200 Mtoe by 2040 under the International Energy Agency’s (“ IEA ”) Sustainable Development Scenario, which models meeting in full the world’s goals to tackle climate change, improve air quality and provide access to modern energy. RNG consumption is expected to increase from 3 Mtoe in 2018 to 75 Mtoe in 2040, a compound annual growth rate of 16%.

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The North American outlook for global methane consumption under the IEA’s Sustainable Development Scenario is set out in the graph below (in PJ).

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See “ General Development and Business of the Company – Business of EverGen Infrastructure Corp. – Industry Overview and Competitive Conditions ”.

The Offering

Issuer: EverGen Infrastructure Corp. Offering: 3,080,000 Offered Units (not including the Over-Allotment Option, and 3,542,000 Offered Units if the Over-Allotment Option is exercised in full). Offering $6.50 per Offered Unit. Price:

Size of	$20,020,000
Offering:
Underwriters’	Pursuant to the terms and conditions of the Underwriting Agreement, the Company has agreed to
Fee:	pay the Underwriters’ Fee equal to 6% of the gross proceeds of the Offered Units, inclusive of any
	exercise of the Over-Allotment Option. Notwithstanding the foregoing, a reduced Underwriters’
	Fee of 3% will be paid with respect to Offered Units sold to purchasers from the President’s List.
	See “Plan of Distribution”.
Over-	The Company has granted the Underwriters the Over-Allotment Option, exercisable, in whole or
Allotment	in part, at the sole discretion of the Underwriters, at any time prior to the Over-Allotment Deadline,
Option:	to purchase up to an additional 462,000 Over-Allotment Units, equal to 15% of the aggregate number of Offered Units purchased pursuant to the Offering at the Offering Price, to cover over-
	allotments, if any, and for market stabilization purposes. The Over-Allotment Option may be
	exercised to acquire (i) Over-Allotment Units at the Offering Price, or (ii) Over-Allotment Shares
	at a price of $6.32 per Over-Allotment Share, or (iii) Over-Allotment Warrants at a price of $0.18
	for each one-half of one Over-Allotment Warrant, or (iv) any combination of Over-Allotment
	Units, Over-Allotment Shares and Over-Allotment Warrants, so long as the aggregate number of
	Over-Allotment Shares and Over-Allotment Warrants that may be issued under the Over-Allotment
	Option does not exceed 462,000 Over-Allotment Shares and 231,000 Over-Allotment Warrants.
	See “Plan of Distribution”.
Shares	13,367,392 Common Shares will be issued and outstanding upon completion of the Offering
Outstanding:	(approximately 13,829,329 Common Shares if the Over-Allotment Option is exercised in full). The
	foregoing gives effect to the deemed exercise of 1,059,325 Special Warrants.
Use of	The estimated net proceeds to the Company from the Offering will be $17,818,800, after deducting
Proceeds:	the Underwriters’ Fee of $1,201,200 and estimated expenses of the Offering of $1,000,000, and
	assuming the Over-Allotment Option is not exercised. If the Underwriters exercise the Over-
	Allotment Option in full, the estimated net proceeds from the Offering will be $20,641,620 after
	deducting the Underwriters’ Fee of $1,381,380 and estimated expenses of the Offering of
	$1,000,000. The foregoing assumes there are no sales under the President’s List.

The Company intends to use the net proceeds from the Offering as follows:

	Net Proceeds
Principal Purposes	under Offering
Project Construction, Development, Acquisitions and Expansion	$17,318,800(1)
Working Capital	$500,000
Total	$17,818,800

Notes:

(1) See “ Use of Proceeds – Business and Milestones ”.

The net proceeds outlined above together with other available and expected funds (project level debt, government grants and cash flow from operations) support the Company’s ability to execute on its business plan for a minimum 18-month period.

While the Company intends to spend the net proceeds from the Offering as stated above, there may be circumstances where, for sound business reasons, funds may be re-allocated at the discretion of the Board or management. See “ Use of Proceeds – Business and Milestones ”.

Proceeds raised pursuant to the exercise of the Over-Allotment Option, if any, are intended to be allocated to Project Construction, Development, Acquisitions and Expansion.

Lock-Up Agreements:

In connection with the Offering, each of the Company’s senior officers and directors, and, as applicable, associates and affiliates, will be required to enter into lock-up agreements in favour of the Underwriters, pursuant to which each will agree not to, directly or indirectly, offer, issue, sell, grant, secure, pledge, or otherwise transfer, dispose of or monetize, or engage in any hedging transaction, or enter into any form of agreement or arrangement the consequence of which is to alter economic exposure to, or announce any intention to do so, in any manner whatsoever, any Common Shares or securities convertible into, exchangeable for, or otherwise exercisable to acquire Common Shares or other equity securities of the Company for a period of 180 days after the Closing Date, without the prior written consent of the Co-Lead Underwriters on behalf of the Underwriters, such consent not to be unreasonably withheld, or subject to certain other limited exceptions as contained in the lock-up agreements.

In connection with the Subscription Receipt Financing (as defined herein), the December Directors and Officers (as defined herein) entered into the December Lock-Up Agreements, pursuant to which the December Directors and Officers have agreed not to, directly or indirectly, offer, sell, transfer, pledge, hypothecate, lend, assign, grant an option or right to purchase, make any short sale, enter into any swap, forward, hedge or any other agreement or arrangement to transfer the economic consequences of or alter the economic exposure to, or otherwise dispose of, monetize or deal with, or publicly announce any intention to do any of the foregoing, whether through the facilities of a stock exchange, by private transaction or otherwise, any of the Common Shares issued prior to December 17, 2020 until December 22, 2023, subject to certain limited exceptions, without the prior written consent of Desjardins and Clarus, such consent not to be unreasonably withheld.

In connection with the Special Warrant Financing, each subscriber thereto has entered into Voluntary Lock-Up Agreements (as defined herein) in favour of the Company and each of the Special Warrant Agents, pursuant to which each such subscriber of Special Warrants has agreed that it will not directly or indirectly, offer, sell or transfer (i) any Common Shares held on March 18, 2021 by the subscriber or an entity directly or indirectly under the control or direction of the subscriber, or (ii) any of the Special Warrant Unit Shares or Special Warrant Unit Warrants comprising the Special Warrant Units issued on the Automatic Exercise Date or upon a voluntary exercise to the subscriber or an entity directly or indirectly under the control or direction of the subscriber, or any Special Warrant Shares subsequently acquired, for the period commencing from the Listing Date to the date that is 6 months following the Listing Date, subject to limited exceptions, without the prior written consent of the Special Warrant Agents, such consent not to be unreasonably withheld, or as permitted pursuant to the release schedule as set out below:

Release Date Listing Date 1 month after the Listing Date 2 months after the Listing Date 3 months after the Listing Date 4 months after the Listing Date 5 months after the Listing Date 6 months after the Listing Date	Percentage of Releasable Applicable Securities
	40% 10% 10% 10% 10% 10% 10%

As a result of the various voluntary lock-up agreements in addition to other resale restrictions imposed under securities laws (NP 46-201 escrow), approximately 6,616,825 or 64.3% of the

10,287,392 Common Shares expected to be issued and outstanding (giving effect to the deemed exercise of the Special Warrants and prior to completion of the Offering), on a non-diluted basis, will be subject to restrictions on transfer for varying time periods following the Closing Date. However, pursuant to the various applicable release schedules, it is anticipated that approximately 1,978,730 Common Shares (19.2% of the Common Shares on the Closing Date prior to giving effect to the Offering) will be released and freely tradeable as of the Closing Date, resulting in approximately 4,638,098 Common Shares (45.1% of the Common Shares on the Closing Date prior to giving effect to the Offering) remaining subject to some form of escrow period or lock-up period on the Closing Date. On the basis of the Offering Price, the foregoing assumes, in all instances that the TSX-V Policy 5.4 seed share resale restrictions will not be applicable.

See “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer ”.

Dividend The Company currently intends to retain any future earnings to fund the development and growth Policy: of its business and does not currently anticipate paying dividends on the Common Shares. Any determination to pay dividends in the future will be at the discretion of the Board and will depend on many factors, including, among others, the financial condition of the Company, current and anticipated cash requirements, contractual restrictions and financing agreement covenants, solvency tests imposed by applicable corporate law and other factors that the Board may deem relevant. See “ Dividend Policy ”.

Eligibility for In the opinion of Borden Ladner Gervais LLP, counsel to the Company, and Cassels Brock & Investment: Blackwell LLP, counsel to the Underwriters, based on the current provisions of the Tax Act and the Regulations, a Unit Share, Warrant and Warrant Share offered hereunder will be a “qualified investment” under the Tax Act and the Regulations for a trust governed by a “registered retirement savings plan”, a “registered retirement income fund”, a “registered education savings plan”, a “registered disability savings plan”, a “tax-free savings account”, or a “deferred profit sharing plan” (as those terms are used in the Tax Act), provided in each case that the conditions set out under “ Eligibility for Investment ” herein are met. See “ Eligibility for Investment ”.

Risk Factors: EverGen is a developing RNG infrastructure company and as such is subject to a number of significant risks due to the nature of its business. Investors should read the entire Prospectus and consult with their professional advisors to assess an investment in the Offered Units. See “ Risk Factors ” for a discussion of certain factors investors should carefully consider before deciding to invest in the Offered Units.

Risks related to the Company include, without limitation:

operational risks;
environmental risks;
regulatory risks, including changes to national and local legislation;
reliance on permits and authorizations and delays in receiving such permits and authorizations;
the Company’s renewable gas infrastructure platform may fail performance expectations;
the Company’s commercial success depends on its ability to develop and operate individual renewable energy projects;
demand for renewable energy;
the Company’s renewable energy projects may not generate expected levels of output;
dependence on two current projects for operating revenues;
relationship with customers/suppliers;
feedstock and re-contracting risk;
the Company’s insurance coverage may be inadequate to cover potential losses;
maintaining lease agreements;
managing growth;
retention and acquisition of skilled personnel;

the directors and officers may have conflicts of interest with the Company;
economic and market conditions;
potential acquisition and investment opportunities;
future acquisitions may require significant expenditures and may result in inadequate returns;
issuance of debt and levels of indebtedness;
estimates or judgments relating to critical accounting policies;
historical and pro forma consolidated financial information may not be representative of the Company’s results as a combined entity;
cyberattacks may cause disruptions to the Company’s operations and could have a material effect on its business;
the Company may be subject to costly legal proceedings;
the Company will incur increased costs as a result of complying with the reporting requirements, rules and regulations affecting public issuers;
COVID-19 may further disrupt the business of the Company;
global financial conditions can reduce the price of the Common Shares;
it may be difficult to enforce judgments and effect service of process on a certain director;
general risks relating to the FVB Acquisition;
integration of FVB’s business;
possible failure to realize anticipated benefits of the FVB Acquisition;
possible failure to achieve the full amount of anticipated cost synergies;
investors may lose their entire investment;
there is no existing public market for the Common Shares or the Warrants;
the Warrants will not be listed for trading;
the Company may not use the proceeds from the Offering and other available funds as described in this Prospectus;
the Company will require other available funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations;
dilution from equity financing could negatively impact holders of Offered Units;
equity securities are subject to trading and volatility risks;
sales by existing shareholders can reduce share prices;
the Company is not likely to pay dividends for an extended period of time;
Warrant holders will not have shareholder rights;
public companies are subject to securities class action litigation risk; and
if securities or industry analysts do not publish research or publish inaccurate or unfavourable research about the Company’s business, the price and trading volume of the Common Shares could decline.

Summary of Selected Historical Financial Information and Pro Forma Financial Information

The following tables set out certain selected financial information of the Company and of the Predecessor Entities for the periods and as at the dates indicated. This information has been derived from and is qualified in its entirety by the audited financial statements, the unaudited consolidated financial statements and the related notes thereto included in this Prospectus. The Company and the Predecessor Entities prepare their financial statements in accordance with IFRS. Investors should read the following information in conjunction with those financial statements and related notes

thereto, along with the consolidated MD&A of the Company and the Predecessor Entities and the interim MD&A of the Company, all of which are attached to this Prospectus.

Selected Consolidated Financial Information of the Company

	As at and for the	As at and for the
	three months ended	period ended
($000s exceptper share amounts)	March 31, 2021	December 31, 2020(1)
Current assets	18,827	6,979
Working capital surplus (deficit)(2)	11,579	(2,842)
Property and equipment	11,540	11,597
Intangible assets	20,571	20,960
Goodwill	10,974	10,974
Current liabilities	7,248	9,821
Shareholders’ equity	40,317	31,909
Gross profit	988	-
Net loss	(1,158)	(2,233)
Basic net loss per share	(0.13)	(17.05)
Diluted net loss per share	(0.13)	(17.05)
EBITDA(3)	(960)	(2,521)
Adjusted EBITDA(3)	203	-

Notes:

(1) Period ended December 31, 2020 covers May 13, 2020, the Company’s date of incorporation, to December 31, 2020.

(2) Working capital is the measure of current assets less current liabilities and is a non-IFRS measure. See “ Non-IFRS Measures ”.

(3) EBITDA and Adjusted EBITDA are non-IFRS measures. See “ Non-IFRS Measures ”.

Selected Financial Information of NZWA

	As at and for the	As at and for the	As at and for the
	year ended		year ended
($000s exceptper share amounts)	December	31, 2020	December 31, 2019
Current assets		843	542
Working capital deficit(1)		(298)	(1,507)
Property and equipment		6,123	5,273
Current liabilities		1,141	2,049
Shareholders’ equity		3,733	1,681
Gross profit		2,986	2,054
Net income		1,094	746
Basic net income per share		1,094	746
Diluted net income per share		1,094	746
EBITDA(2)		2,063	1,420
Adjusted EBITDA(2)		2,280	1,969

Notes:

(1) Working capital is the measure of current assets less current liabilities and is a non-IFRS measure. See “ Non-IFRS Measures ”. EBITDA and (2) EBITDA and Adjusted EBITDA are non-IFRS measures. See “ Non-IFRS Measures ”.

Selected Financial Information of SSS

	As at and for the	As at and for the	As at and for the	As at and for the
	year ended		year ended
($000s exceptper share amounts)	December	31, 2020	December	31, 2019
Current assets		1,846		1,724
Working capital(1)		105		579
Property and equipment		5,308		4,233
Current liabilities		1,741		1,145
Shareholders’ equity		2,986		2,840
Gross profit		3,029		3,076
Net income		796		1,529
Basic net income per share		0.21		0.37
Diluted net income per share		0.21		0.37
EBITDA(2)		1,477		2,341
Adjusted EBITDA(2)		2,023		2,368

Notes:

(1) Working capital is the measure of current assets less current liabilities and is a non-IFRS measure. See “ Non-IFRS Measures ”. (2) EBITDA and Adjusted EBITDA are non-IFRS measures. See “ Non-IFRS Measures ”.

Selected Pro Forma Financial Information

The following table sets out certain selected financial information of the pro forma consolidated financial information of the Company for the period and as at the date indicated. This information has been derived from and is qualified in its entirety by the pro forma consolidated financial statements of the Company, as at December 31, 2020, which give effect to the Acquisitions of the Predecessor Entities, as if such Acquisitions had taken place on January 1, 2020 for the year ended December 31, 2020, and related notes thereto included in this Prospectus, and is based on the assumptions described in such notes. The pro forma consolidated statements are not necessarily indicative of the Company’s results that would have occurred if the events reflected had taken place on the dates indicated, nor does it purport to project the Company’s consolidated financial position or results for any future period. The selected pro forma consolidated set out below should be read in conjunction with the description of the Acquisitions in this Prospectus, the pro forma consolidated financial statements and related notes thereto, and the audited financial statements of the Company and the Predecessor Entities and related notes thereto, included in this Prospectus.

ompany and the Predecessor Entities and related	notes thereto, included in thi
	As at and for the
	year ended
	December 31,
($000s exceptper share amounts)	2020
Revenue	8,868
Gross profit	6,011
Operating costs	1,833
General and administrative expenses	1,153
Net loss before income taxes	(1,656)
Net loss	(1,540)
Basic net loss per share	(0.19)
Diluted net loss per share	(0.19)
EBITDA(1)	949
Adjusted EBITDA(1)	4,303

Note:

(1) EBITDA and Adjusted EBITDA are non-IFRS measures. See “ Non-IFRS Measures ”.

See “ Selected Historical Financial Information and Pro Forma Financial Information ”.

CORPORATE STRUCTURE

Name, Address and Incorporation

EverGen was incorporated under the BCBCA on May 13, 2020. The Articles were amended on May 19, 2020 to change its name from 1250139 B.C. Ltd. to EverGen Infrastructure Corp.

Intercorporate Relationships

Pursuant to the Acquisitions, the Company has three subsidiaries: Net Zero Waste Abbotsford Inc., Sea to Sky Soils Composting Inc. and Fraser Valley Biogas Ltd. (previously defined as the “ Acquired Businesses ”). The Acquired Businesses were incorporated under the BCBCA. NZWA’s head office is located at 5050 Gladwin Road, Abbotsford, British Columbia, Canada, V4X 1X8, SSS’s head office is located at South Rutherford Creek Road, Whistler, British Columbia, Canada, V0N 1B8, and FVB’s head office is located at 2016 Interprovincial Hwy, Abbotsford, British Columbia, Canada, V3G 2H8.

The current organizational structure of the Company and the Acquired Businesses is set forth below:

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GENERAL DEVELOPMENT AND BUSINESS OF THE COMPANY

General Development of the Company

History

EverGen Infrastructure Corp. was incorporated in the Province of British Columbia on May 13, 2020.

Since its inception, EverGen has completed certain private placement financings and entered into a credit facility prior to the date of this Prospectus.

On December 22, 2020, EverGen closed its brokered private placement for gross proceeds of $23,085,000 (the “ Subscription Receipt Financing ”) through the issuance of 4,617,000 subscription receipts of the Company (“ Subscription Receipts ”) at a price of $5.00 per Subscription Receipt. Each Subscription Receipt was automatically converted, without payment of any additional consideration and without further action on the part of the holder thereof, for one Common Share upon satisfaction of the escrow release conditions as set out in the subscription receipt agreement dated December 22, 2020 among the Company, TSX Trust Company, as receipt agent and the co-lead agents (the “ Subscription Receipt Agreement ”). The Subscription Receipts converted into Common Shares (each an “ Underlying Share ”) on December 31, 2020, when EverGen completed its acquisition of NZWA and SSS (see “ Significant Acquisitions ” below). Clarus and Desjardins, as co-lead agents, together with Canaccord Genuity Corp., acted as agents in connection with the Subscription Receipt Financing pursuant to the terms of an agency agreement dated December 22, 2020. In consideration for their services in connection with the Subscription Receipt Financing, the Company paid the agents a cash commission equal to $1,385,100 and the Company issued to the agents 277,020 compensation options (the “ Broker Compensation Options ”). Each Broker Compensation Option is exercisable to acquire one Common Share at an exercise price of $5.00 until December 30, 2022. Effective June 22, 2021 an additional 461,700 Common Shares were issued, for no additional consideration, to the holders of the Underlying Shares as satisfaction of the right attached to each Underlying Share to receive 0.10 of a Common Share in the event that the Company did not complete a liquidity event (as defined in the Subscription Receipt Agreement) by that date.

On December 30, 2020 and on a rolling basis throughout January and February 2021, EverGen closed multiple tranches of its non-brokered private placement, for gross proceeds of $8,359,880 (the “ December Non-Brokered Private Placement ”) through the issuance of 1,671,976 Common Shares at a price of $5.00 per Common Share. In connection with the December Non-Brokered Private Placement, the Company paid certain finders a cash commission equal to $105,000, issued 41,976 Common Shares and issued 62,976 finder compensation options (of which 21,000 were issued to the agents who participated in the Subscription Receipt Financing) (the “ Finder Compensation Options ”). Each Finder Compensation Option is exercisable to acquire one Common Share at an exercise price of $5.00 until December 30, 2022.

As further described below, on December 31, 2020, the Company completed its acquisition of NZWA and SSS. On March 18, 2021, EverGen paid to the escrow agent in trust the balance owing for the remainder of the purchase price for each of the Acquisitions, in accordance with the escrow agreement as attached to the NZWA Purchase Agreement and SSS Purchase Agreement.

On March 17, 2021, the Company entered into a credit facility arrangement with Roynat Inc. (providing for a senior secured term loan with available funds of up to $7,000,000 repayable over 3 years with interest at the Roynat Inc. floating base rate plus 3.00% per annum) (the “ Roynat Credit Facility ”). The Roynat Credit Facility is secured by, inter alia general security agreements entered into by each of the Company, NZWA and SSS granting a charge over all personal property assets of the Company, NZWA and SSS, a mortgage of lease from NZWA over the leasehold property at the NZWA Project and a mortgage of license from SSS over certain portions of the lands at the SSS Project. The Roynat Credit Facility contains several affirmative and negative covenants, including those related to maintaining certain levels of working capital, fixed charge coverage and total fund debt to EBITDA ratios. In addition to the repayment obligations, the facility also contains a provision that requires the Company to make an annual cash sweep payment equal to 50% of “Free Cash Flow” (as defined in the Roynat Credit Facility) to a maximum of $368,000 per annum. As at April 19, 2021, $7,000,000 was drawn down under the Roynat Credit Facility, with $2,706,527 used to fund the FVB Acquisition (as defined below), and the remainder intended to be utilized to cover the costs associated

with the Offering and other working capital and general corporate purposes. For more information, see the full text of the Roynat Credit Facility on the Company’s SEDAR profile at www.sedar.com.

On March 18, 2021, EverGen completed a private placement of 1,059,325 Special Warrants at a price of $8.00 per Special Warrant for aggregate gross proceeds of $8,474,600 (the “ Special Warrant Financing ”). As part of the Special Warrant Financing, the Company completed a brokered private placement of 756,200 Special Warrants for gross proceeds of $6,049,600 (the “ Brokered Private Placement ”) to purchasers resident in certain provinces in Canada (and in jurisdictions outside of Canada) on a private placement basis pursuant to prospectus exemptions under applicable securities legislation and in accordance with the terms of an agency agreement dated March 18, 2021 (the “ Agency Agreement ”) among the Company and the Special Warrant Agents. EverGen also concurrently completed a non-brokered private placement of 303,125 Special Warrants for gross proceeds of $2,425,000 (the “ Non-Brokered Private Placement ”) to purchasers resident in certain provinces in Canada (and in jurisdictions outside of Canada) on a private placement basis pursuant to prospectus exemptions under applicable securities legislation. The Special Warrants were issued pursuant to the terms of a special warrant indenture (the “ Special Warrant Indenture ”) dated March 18, 2021 between the Company and TSX Trust Company, as special warrant agent thereunder. Each Special Warrant entitles its holder to receive, upon exercise or deemed exercise, one Special Warrant Unit at no additional cost. Each Special Warrant not previously voluntarily exercised by the holder thereof shall be deemed exercised on behalf of, and without any required action on the part of, the holder thereof, for one Special Warrant Unit on the Automatic Exercise Date. Each Special Warrant Unit is comprised of one Common Share (a “ Special Warrant Unit Share ”) and one-half of one Common Share purchase warrant (each whole Common Share purchase warrant, a “ Special Warrant Unit Warrant ”). Each Special Warrant Unit Warrant entitles the holder thereof to acquire one Common Share (a “ Special Warrant Share ”) at a price of $10.50 for a period of 24 months from the Automatic Exercise Date (as defined below). The deemed exercise of the Special Warrants is expected to occur on July 20, 2021, being the first business day following the Exercise Deadline, whereby Special Warrant Unit Shares and Special Warrant Unit Warrants will be issued. The Company will not receive any additional proceeds upon the voluntary or automatic exercise of any Special Warrants.

In connection with the Brokered Private Placement, the Company paid to Desjardins and Clarus as the Special Warrant Agents a cash fee of $362,976 (equal to 6% of the gross proceeds from Special Warrants sold pursuant to the Brokered Private Placement), and issued to the Special Warrant Agents 22,686 non-transferable broker options of the Company (the “ Broker Options ”). Each Broker Option will automatically be exchanged for one transferable broker warrant of the Company (the “ Broker Warrants ”) on the Automatic Exercise Date, with each Broker Warrant being exercisable for one unit of the Company (a “ Broker Unit ”) at a price of $8.00 for a period of 12 months following the Automatic Exercise Date. Each Broker Unit is comprised of one Common Share (a “ Broker Unit Share ”) and one-half of one Common Share purchase warrant (each whole Common Share purchase warrant, “ Broker Unit Warrant ”). Each Broker Unit Warrant entitles the holder thereof to acquire one Common Share (a “ Broker Warrant Share ”) at a price of $10.50 for a period of 24 months from the Automatic Exercise Date. Additionally, in connection with the NonBrokered Private Placement, the Company worked with a finder (the “ Finder ”) and paid such Finder a fee equal to 6% of the gross proceeds from Special Warrants sold to subscribers of the Non-Brokered Private Placement that were introduced by the Finder, which was settled by issuing 13,500 Common Shares at a price of $8.00 per Common Share to the Finder, and issued to the Finder 6,750 non-transferable finder warrants (the “ Finder Warrants ”). Each Finder Warrant is exercisable for one Common Share (a “ Finder Warrant Share ”) at a price of $8.00 for a period of 12 months following the Automatic Exercise Date. No fees were paid to the Special Warrant Agents or the Finder in connection with 78,125 Special Warrants ($625,000 in gross proceeds) sold under the Non-Brokered Private Placement.

As further described below, on April 16, 2021, the Company completed its acquisition of FVB. The purchase price was funded in part from the Special Warrant Financing ($7,896,083) and in part from the Roynat Credit Facility ($2,706,527).

On April 27, 2021, the Company closed a non-brokered private placement for gross proceeds of $1,000,000 (the “ April 2021 Private Placement ”) through the issuance of 111,111 Common Shares at a price of $9.00 per Common Share to a purchaser resident in Canada on a private placement basis pursuant to prospectus exemptions under applicable securities legislation.

Significant Acquisitions

Net Zero Waste Abbotsford Inc.

Effective December 31, 2020, EverGen acquired all of the issued and outstanding shares in the capital of Net Zero Waste Abbotsford Inc. (previously defined as “ NZWA ”), pursuant to a share purchase agreement dated December 18, 2020 and amended February 5, 2021, to amend the holdback provisions (the “ NZWA Purchase Agreement ”), among EverGen, Net Zero Waste Inc. (“ NZI ”), 806148 Alberta Ltd., Rafael Ocejo, and Andres Ocejo (the “ NZWA Acquisition ”). Pursuant to the terms of the NZWA Purchase Agreement, the Company paid an aggregate amount of $14,350,000, consisting of (i) a $300,000 deposit, (ii)a cash payment of $12,050,002, of which $940,457 was paid to discharge in full the Closing Date Debt (as defined in the NZWA Purchase Agreement), and (iii) the issuance of 444,444 Common Shares (with the aggregate value of $1,999,998). Additionally, pursuant to section 2.3(c) of the NZWA Purchase Agreement, EverGen paid to the escrow agent in trust: (i) 50% of the holdback ($1,075,000) on February 24, 2021; and (ii) the remaining 50% of the holdback ($1,075,000) on March 18, 2021, to be held in accordance with the escrow agreement as attached to the NZWA Purchase Agreement.

In connection with the NZWA Acquisition and the SSS Acquisition, the Company paid Dekany Consulting Inc., a company controlled by Mr. Mezei, a success fee in cash equal to $250,000 (the “ Finder Fee ”) pursuant to a finders’ fee agreement between the Company and Dekany Consulting Inc.

NZWA owns and operates a food, green and agricultural waste commercial composting facility in the City of Abbotsford, British Columbia.

For more information, see the full text of the NZWA Purchase Agreement on the Company’s SEDAR profile at www.sedar.com.

Sea to Sky Soils and Composting Inc.

Effective December 31, 2020, EverGen also acquired all of the issued and outstanding shares in the capital of Sea to Sky Soils and Composting Inc. (previously defined as “ SSS ”), pursuant to a share purchase agreement dated December 18, 2020 and amended February 5, 2021 to amend the holdback provision (the “ SSS Purchase Agreement ”), among EverGen, NZI, Jaye-Jay Earl Berggren and Enviro GP Limited (in its capacity as general partner of Enviro Limited Partnership) (the “ SSS Acquisition ”). Pursuant to the terms of the SSS Purchase Agreement, the Company paid an aggregate amount of $13,648,137, consisting of (i) a cash payment of $12,148,138, of which $549,713 was paid to discharge in full the Closing Date Debt (as defined in the SSS Purchase Agreement) and release all security in connection therewith, and (ii) the issuance of 333,333 Common Shares (with the aggregate value of $1,499,999). Additionally, pursuant to section 2.3(b) of the SSS Purchase Agreement, EverGen paid to the escrow agent in trust: (i) 50% of the holdback ($1,869,341) on February 24, 2021; and (ii) the remaining 50% of the holdback ($1,869,341) on March 18, 2021, to be held in accordance with the escrow agreement as attached to the SSS Purchase Agreement.

As noted above, in connection with the NZWA Acquisition and the SSS Acquisition, the Company paid Dekany Consulting Inc., a company controlled by Mr. Mezei, the Finder Fee.

SSS owns and operates an organic waste commercial composting facility hosted by and leased from the Lil’wat Nation in the Village of Pemberton, British Columbia, and employs individuals from the Lil’wat Nation.

For more information, see the full text of the SSS Purchase Agreement on the Company’s SEDAR profile at www.sedar.com.

Consulting Agreement

Following the completion of the NZWA Acquisition and the SSS Acquisition, the Company and NZI entered into a consulting services agreement dated December 31, 2020, as amended and restated May 31, 2021 (the “ NZI Consulting Agreement ”). NZI was the existing operator of both the NZWA Project and the SSS Project prior to their acquisition by the Company, and the Company wished to retain NZI in such role for purposes of maintaining a

consistent transition and continuity of business operations. Pursuant to the terms of the NZI Consulting Agreement, NZI serves as the operator of the NZWA Project and the SSS Project as an independent contractor for a 15-month term (unless mutually extended by the parties). The consulting services under the agreement consist of (i) maintaining the existing composting operations for the NZWA Project and the SSS Project, (ii) facilitating the transition of existing operations of the business, (iii) maintaining and acquiring necessary permits for expansion at the NZWA Project and SSS Project, and (iv) securing additional tonnage for both sites. The Company pays NZI an annual consulting fee equal to $150,000 during the term of the NZI Consulting Agreement, prorated for any partial years to be paid in monthly installments. Pursuant to the terms of the NZI Consulting Agreement, NZI received, as partial consideration, 50,000 Common Shares (at a deemed price of $5.00 per share) upon execution of the agreement and is entitled to receive an additional $250,000 of Common Shares (to be issued at a deemed price in accordance with the TSX-V policies at the time the shares are earned) upon the completion and satisfaction of certain post closing deliverables under the NZWA Purchase Agreement. NZI is also entitled to receive a bonus in the event it is responsible for the Company or a subsidiary securing a municipal contract for 20,000 tonnes of industrial, commercial and institutional (ICI) materials, provided any such contract is for a minimum (i) six year term, and (ii) price of $90 per tonne, within 15 months from the date of the consulting agreement. If NZI earns such bonus, it shall be entitled to receive $12.50 per tonne which is invoiced and received by the Company pursuant to the municipal contract, for a period of 6 years from the date of the municipal contract, up to a cap of $1,500,000.

Other Business Acquisition

Fraser Valley Biogas Ltd.

Effective April 16, 2021, EverGen acquired from the Vendors (as defined below) all of the issued and outstanding shares in the capital of Fraser Valley Biogas Ltd. (previously defined as “ FVB ”) and from Heppell’s Potato Corp. (“ Heppell ”) all legal and beneficial interest in the real property having a municipal address of 2016 Interprovincial Highway, Abbotsford, B.C. V3G 2H8 and legally described as Parcel Identifier: 010-837-906, Lot 79, Section 13, Township 19, New Westminster District Plan 4211 (the “ Land ”), pursuant to a share purchase agreement dated April 16, 2021 (the “ FVB Purchase Agreement ”) among EverGen, Heppell and Pela Holdings Ltd. (“ Pela ”, together with Heppell, the “ Vendors ”) (the “ FVB Acquisition ”). Pursuant to the terms of the FVB Purchase Agreement, EverGen paid an aggregate amount of $11,500,000 to the Vendors, consisting of the issuance of 125,000 Common Shares (with the aggregate value of $1,000,000) and a cash payment of $10,500,000 paid at closing to the Vendors (as applicable), together representing: (i) the amount equal to $3,760,543, being the portion of the Share Purchase Price (as defined in the FVB Purchase Agreement) paid by EverGen to Pela; (ii) the aggregate amount of $6,739,457, of which $3,089,457 was in respect of the portion of the Share Purchase Price paid by EverGen to Heppell and of which $3,650,000 was paid to satisfy the Land Purchase Price (as defined in the FVB Purchase Agreement), in connection with the acquisition of the Land from Heppell. In addition, an amount of $785,000, representing the holdback amount was paid to Clark Wilson LLP as the escrow agent in accordance with the terms of the escrow agreement dated April 16, 2021, among the parties. None of the foregoing reflects the post-closing adjustments pursuant to the terms of the FVB Purchase Agreement.

FVB owns and operates a biogas facility in the City of Abbotsford, British Columbia.

For more information, see the full text of each of the FVB Purchase Agreement on the Company’s SEDAR profile at www.sedar.com.

Future Business Acquisitions

From time to time, EverGen evaluates and considers, and may be engaged in discussions and negotiations with respect to potential acquisition and investment opportunities that it believes may assist the Company in achieving its business and growth plans, and in connection therewith may at any time have outstanding non-binding letters of intent or conditional agreements which could, if consummated, be material to the Company. There can be no assurance that any such discussions, negotiations, non-binding letters of intent or conditional agreements will result in a definitive agreement with respect to an acquisition or investment, and if they do, what the terms or timing of such acquisitions or investments would be or that such acquisition or investment will be completed by EverGen. See “ Risk Factors – Risks Related to the Company – Potential Acquisition and Investment Opportunities ” and “– Future Acquisitions May Require Significant Expenditures and May Result in Inadequate Returns ”.

Currently, EverGen expects and intends to use a portion of the net proceeds of the Offering and other funds being pursued, for the purpose of identifying and acquiring new RNG projects and the associated costs thereof including due diligence costs, legal costs, and all or a portion of the purchase prices in connection with such acquisitions and other transaction costs. The Company is currently in discussions with its existing and other potential lenders to secure additional debt financing in order to progress the business objectives and milestones of the Company. While the Company believes that discussions and negotiations will results in additional debt financing being made available, there is no assurance that any definitive agreement will be reached or that such additional financing will be available on favourable terms, acceptable to the Company, or at all. See “ Use of Proceeds ”. The Company also anticipates that operating cash flow and the potential to secure government grants related to renewable energy projects will provide additional sources of funds for the Company to achieve its development and expansion plans and other business objectives, however there is no assurance that any such amounts will be available or sufficient to achieve all of the Company’s intended milestones . See “ Risk Factors – Risks Related to the Offered Units – the Company will require other available funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations ”.

For additional information about the Company’s growth strategy also see “ Business of EverGen Infrastructure Corp. – EverGen Strategy – Growth Plans ”

COVID-19

Management has been closely monitoring the impact of COVID-19, with a focus on the health and safety of EverGen’s employees and business continuity. EverGen has implemented various measures to reduce the spread of the virus, including implementing social distancing measures at its facilities and enhancing cleaning protocols at such facilities. EverGen adheres to all health and safety protocols implemented by provincial and local health authorities. As a result of these preventative measures and the nature of EverGen’s operations, which largely occur outdoors with ample space for social distancing, the Company has experienced no material impact to its operations as a result of COVID-19.

However, EverGen cannot estimate the duration and severity of the COVID-19 pandemic and its ultimate financial impact. EverGen continues to work with stakeholders to responsibly address the impact of the global pandemic on operations. EverGen continues to monitor the situation, to assess possible implications to the business, and to take actions in an effort to mitigate adverse consequences. See “ Risk Factors – Risks Related to the Company – COVID19 May Further Disrupt the Business of the Company ”.

Business of EverGen Infrastructure Corp.

EverGen is focused on providing a renewable gas infrastructure platform with the strategy of acquiring, developing, building, owning and operating a portfolio of RNG, waste to energy, and related sustainable infrastructure projects in British Columbia. The Company’s principal business activities since incorporation have been the Acquisitions and operation of the Predecessor Entities, and most recently of FVB. The assets and activities of the Predecessor Entities constitute a majority of the assets and activities disclosed by the Company’s financial statements contained in this Prospectus. NZWA owns and operates a food, green and agricultural waste commercial composting facility in the City of Abbotsford, British Columbia. SSS owns and operates an organic waste commercial composting facility hosted by and on land leased from the Lil’wat Nation in the Village of Pemberton, British Columbia, and employs individuals from the Lil’wat Nation. Additionally, EverGen owns and operates a biogas production facility in the City of Abbotsford, British Columbia through FVB.

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The NZWA Project

The NZWA Project is an operating compost facility with a development stage RNG project located on leased lands in Abbotsford, British Columbia. It generates stable cash flow from compost operations derived largely from municipal tipping fee-based long-term contracts. The NZWA Project is currently permitted to process up to 40,000 tonnes of compost per annum (with expectations to increase to 80,000 tonnes per annum) which, in addition to generating near term revenue, is expected to comprise a material portion of the feedstock for future RNG operations. The Company intends to increase the permitted tonnage of the facility in connection with the development of RNG operations. The Company is advancing RNG development at the NZWA Project. The NZWA Project will involve the construction and operation of an AD facility to be located at the site of existing operations. On August 27, 2020, NZWA entered into a letter of intent with FortisBC in connection with a proposed offtake agreement, and on April 23, 2021, NZWA entered into a conditional long-term offtake agreement with FortisBC pursuant to which FortisBC agreed to purchase a minimum of 130,000 GJ and up to 173,000 GJ of RNG per year from NZWA, at agreed upon specifications and a competitive base rate. The initial term of the offtake agreement is for 20 years and automatically renews for one additional five (5) year term, unless an earlier notice of intention to terminate is provided by either party. The terms of the offtake agreement remain subject to, among other things, final approval from the British Columbia Utilities Commission. Upon the offtake agreement becoming an unconditional and binding agreement between the parties, NZWA expects to capitalize on the incoming organic waste streams, proximal commercial feedstock, and nearby tiein to pipeline infrastructure.

The NZWA Project is located on leased lands pursuant to a lease agreement dated April 2, 2012, as assigned and amended by amending agreements dated November 8, 2012 and April 1, 2021. NZWA exclusively leases the lands underlying the NZWA Project for an initial term of ten (10) years that expires on December 31, 2022. Provided that it is not in default of the lease agreement, NZWA has the option to renew the lease agreement for three (3) further terms of five (5) years each upon the same terms and conditions as the original lease agreement, other than the base rent, provided that it exercises such option not later than 180 days prior to the expiration of the initial term.

The SSS Project

The SSS Project is an operating compost facility located in Pemberton, British Columbia, on a site hosted by and leased from the Lil’wat Nation, and employs individuals from the Lil’wat Nation. The SSS Project has been conditionally approved for inclusion into the Squamish-Lillooet Regional District Solid Waste Management Plan. It previously generated cash flow primarily sourced from source separated organics from Metro Vancouver under the Metro Vancouver Contract, an organic waste processing services contract, which expired on June 30, 2021. On April 16, 2021, EverGen was notified that the Metro Vancouver Contract (which had been the subject of a bid for proposal) had been awarded to another bidder. EverGen has identified additional sources of organic waste tonnage through the Additional Agreements, a combination of long-term municipal contracts and shorter term merchant agreements, and expects to replace any lost revenue from the Metro Vancouver Contract. The SSS Project currently processes approximately 25,000 tonnes per annum of organic waste inputs and is able to produce up to 5,000 tonnes per annum of dry “Class A compost” (as defined in the OMRR) without requiring a permit under the OMRR. SSS is in the process of applying for such a permit under the OMRR in order to expand its design capacity to process up to 60,000 tonnes per annum of organic waste inputs and to increase its production of dry compost up to an expected 12,000 tonnes per annum. In addition to generating near and long-term revenue, this expansion in design capacity is expected to serve as a source of feedstock for existing and future RNG operations. The SSS Project is a recent recipient of a grant of $1.3 million (of which $765,000 was received by SSS) under the Organic Infrastructure Program, a program funded

by the Government of Canada and the Province of British Columbia, related to the expansion of the organic waste facility.

The SSS Project is located on leased lands pursuant to a license agreement dated May 1, 2019. SSS exclusively licences the lands underlying the SSS Project from Lil’wat Capital Assets Limited Partnership for an initial term that expires April 11, 2022. Provided that it is not in default of the license agreement, SSS has the option to renew the licence agreement for three (3) further terms of five (5) years each upon the same terms and conditions as the original licence agreement, other than the base rent, provided that it exercises such option not earlier than 270 days and not later than 180 days prior to the expiration of the initial term.

The FVB Project

Leading the Development of Canada’s RNG Infrastructure

EverGen is committed to Canada’s climate change initiatives through renewable natural gas solutions as well as contributing to the circular economy in recycling waste. EverGen is focused on providing a renewable gas infrastructure platform with the strategy of acquiring, developing, building, owning and operating a portfolio of RNG, waste to energy, and related sustainable infrastructure projects. Currently, EverGen is focused on British Columbia prioritizing attractive development opportunities locally and then expanding the Company’s portfolio regionally with plans to expand into other North American regions over the coming years as other regulatory frameworks progress, including actively pursuing the development of project clusters similar to the one in British Columbia in the provinces of Alberta, Ontario and Québec.

As part of this strategy, EverGen owns and operates organics processing facilities which process municipal source separated organics and food waste under long term contracts. These organics are converted to soil products via composting and are intended to be converted to biogas via AD. The biogas would then be upgraded to RNG and sold to gas utilities under long term contracts. EverGen’s current operational projects are located in British Columbia, Canada where EverGen is focused on becoming the dominant supplier of RNG in the form of purified biomethane to FortisBC, the local gas utility.

The above strategy is implemented in conjunction with EverGen’s commitment to deliver on societal expectations of a circular economy and by fulfilling the Company’s environmental, social, and corporate governance (“ ESG ”) values.

In delivering on its ESG values, EverGen:

E – recycles waste products, expects to produce renewable energy and reduces greenhouse gas emissions;
S – operates as a community-focused business, receiving and recycling organic waste from local municipalities and businesses and focused on partnering with local First Nations including as hosts for its operations and as workforce participants; and
G – is committed to strong governance practices in its current operations and in planned growth and development of RNG. EverGen is dedicated to developing a sustainable business platform through collaboration with stakeholders, communities, First Nations, employees and contractors, customers and

investors and through responsible development, disciplined asset management, financial strength and resiliency and the capacity to operate and grow sustainably.

EverGen is proactively engaging with local businesses, such as restaurants and food and beverage producers and distributors, to advance socially conscious commerce, to create mutually beneficial and socially responsible alternatives to traditional waste disposal and to achieve a reduced carbon footprint. These relationships represent a significant area of growth and diversification from EverGen’s existing customer base and provide the opportunity for market expansion while fulfilling expectations of directing organic waste for recycling and the production of renewable energy. EverGen expects to realize on the societal and local changes in policies, programs and demand for more waste recycling and RNG production.

EverGen is committed to maintaining meaningful and collaborative relationships in the communities in which it operates, with a key focus on working with First Nations groups, who are integral to its operations and who make up a significant percentage of the Company’s workforce.

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(1) Potential RNG Offtake Partners include FortisBC, Énergir, Enbridge Inc., Union Gas Limited,
NW Natural, City of Toronto and Southern California Gas Company.
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Market Opportunity

The quantity of organic waste deposited and diverted in Canada in 2016, by region, is depicted in the graph below.

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Sources: Fortis BC: A little less conversation, a little more (climate) action (August 2020); FortisBC: Clean growth pathway to 2050 (February 2019); Statistics Canada (2018); United States Environmental Protection Agency; and 2020 Environment and Climate Change Canada: National Waste Characterization Report – The Composition of Canadian Residual Municipal Solid Waste

Existing Infrastructure in Canada

With a transmission and distribution grid already in place in Canada, and well established technologies to extract RNG, the implementation and use of RNG is expected to see an accelerated level of adoption when compared to other renewable fuel sources which require a substantial investment in infrastructure prior to being widely accepted.

Canadian RNG Advantages

Canadian gas utilities are leading North America into a low carbon future with RNG as a transition fuel, and EverGen believes that the Canadian RNG market provides with opportunities that are more favourable than those in the United States, including: (i) secure long term offtake arrangements at a fixed price with a single counterparty (i.e. FortisBC); (ii) strong markets for organic waste streams that supply and increase tipping fees; (iii) a competitive landscape that is less competition for the size of projects targeted by the Company; (iv) a positive Federal and Provincial regulatory environment that supports RNG projects; (v) favourable risk/return profiles; and (vi) growth potential including brown-field development or acquisitions of quality projects available. On the other hand, the United States, which provides less favourable opportunities, typically has more complex revenue structuring with multiple counterparties, larger more established RNG players with an increased level of competition for low risk projects, uncertainty around low carbon fuel standards/renewable identification number systems, greater merchant pricing risk, and growth potential generally limited to greenfield projects only.

EverGen’s Competitive Advantage

First Mover Platform: Building on an Existing Local Footprint

Disciplined Execution & Operational RNG Expertise

EverGen brings an experienced team with relevant backgrounds in RNG project development, RNG operations, RNG technology, renewables and energy infrastructure, waste management and disciplined growth of businesses in Canada. The Company’s infrastructure-based approach means it evaluates each project on the strengths of the offtake, feedstock, construction and operational certainties and timing aspects. With a disciplined approach, the Company draws upon the experience of its management team, who have worked on 60 RNG projects worldwide to assist in derisking its technical assumptions, and its support team of experienced professionals with deep understanding of organics management and processing, operational experience of organic waste and anaerobic digestor facilities in Canada and expertise in environmental policy. The Company uses the waste management experience of its management team to understand and develop feedstock strategies, and its relationships to ensure EverGen is a quality partner for offtake agreements.

Positioned for Growth via Acquisitions & Partnerships

EverGen’s Strategy

progressing the development and construction of existing portfolio of RNG expansion projects;
optimization, diversification and expansion of existing organic waste processing capabilities (RNG feedstock);
continuing the growth of its project portfolio via strategic acquisitions and consolidation opportunities; and
developing strategic partnerships and advance RNG project pipeline.

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Growth Plans

EverGen is advancing several projects, partnerships and acquisitions with a unique approach to support future growth, with a preference for brown-field developments or projects with existing EBITDA and expected internal rates of return of 15% or greater (project level) and 25% or greater (equity). As part of the Company’s initial portfolio project pipeline, the Company has identified six projects anticipated to produce approximately 1,030,000 GJ/year by 2024, which include: (i) the Acquired Businesses, other than the SSS Project (expected production of ~340,000 GJ/year by 2022); (ii) one project for which the Company has signed a letter of intent (expected production of ~150,000 GJ/year by 2023); and (iii) three other projects currently under evaluation (expected production of ~540,000 GJ/year by 2024). See “General Development of the Company - Future Business Acquisitions ” above. Active discussions with various parties are ongoing to expand its asset base, with various other identified projects having the potential to unlock an additional 2,625,000 GJ/year. EverGen believes it is uniquely positioned to consolidate a portfolio of fragmented projects in the RNG sector and achieve scale on an accretive basis by applying its infrastructure approach. By 2023, EverGen expects to manage multiple operational RNG projects and maintain organic platform growth by applying a portfolio approach (to aggregate a diverse suite of anaerobic digestion/organics projects, landfill gas projects and

municipal wastewater treatment plants) that focuses on multi-pronged targets (optimization, conversion and new infrastructure projects) with early, accretive cash flows. The Company is targeting approximately 2,822 GJ/day of RNG production across six projects by 2024.

Principal Operations

EverGen applies an infrastructure model that exercises financial discipline and seeks to minimize risk on a fully integrated basis, by targeting project returns that are in line with relative risk of the specific project. EverGen’s infrastructure approach is based on (i) securing long term contracts with respect to its feedstock inputs (long-term municipal contracts) as well as RNG outputs (FortisBC offtake), (ii) proven AD technology which is commonly used in the European market, and (iii) executing on its development model through its network of strategic partnerships and committed stakeholders.

EverGen’s strategy is to develop, own, and operate RNG projects using proven technologies and intends to supply RNG primarily into the gas grid through the operation of RNG projects. EverGen also develops, owns, and operates organics processing facilities which process municipal source separated organics and food waste under long term contracts. These organics are converted to soil products via composting and are intended to be converted to biogas via AD. The biogas would then be upgraded to RNG and sold to gas utilities under long term contracts. EverGen’s projects are currently located in British Columbia, Canada and the Company plans to become the dominant supplier of RNG in the form of purified biomethane to FortisBC, the local gas utility, and expand its operations in North America, including actively pursuing the development of project clusters similar to the one in British Columbia in the provinces of Alberta, Ontario and Québec. The NZWA Project, a development stage RNG project based on food, green and agricultural waste commercial composting, is located in the City of Abbotsford, British Columbia, and the SSS Project, an operating organic waste commercial composting facility, is located in the Village of Pemberton, British Columbia. The FVB Project, an operating RNG facility, is located in Abbotsford, British Columbia. See “ General Development and Business of the Company – General Development of the Company - Significant Acquisitions ” and “– Other Business Acquisition ”.

Industry Overview and Competitive Conditions

Renewable energy demand is significantly expanding outside of traditional electrical generation driven by a growing appreciation that efforts beyond electrification are needed to meet GHG objectives and with a push by many gas utilities to renewable sources. Currently, the gas grid in North America has a market share of renewables of less than 1% by volume, with many utilities looking to achieve a target of 5-15% renewables by volume and with some utilities having mandates to reach such targets within certain specified time periods. At the same time, circular economy expectations are growing with organic waste diversion rates growing significantly in North America as municipalities adopt landfill bans for organic materials that emit harmful greenhouse gas emissions.

Source: Waste 360, Informa Markets

Greenhouse Gas Emissions and Targets

According to the Intergovernmental Panel on Climate Change, an intergovernmental body of the United Nations, there is significant global momentum in the desire to reduce GHG emissions driven by current and future expected impacts to the environment. The current estimate of global warming caused by human activities is 1.0% above pre-industrial levels and expected to reach 1.5% between 2030 and 2055. An increase in the global temperature is projected to cause several adverse impacts such as a rise in sea levels, species loss and extinction, food insecurity and a reduction in water supply. These and other adverse outcomes would only intensify should the temperature increase to 2.0% above pre-industrial levels which is projected by 2100 if no intervention in human activity occurs.

Methane produced from agricultural activities and waste management represent a significant portion of global GHG emissions. As a result, governments have begun to recognise the potential for RNG to act as one of the tools to reduce GHG emissions. When captured for conversion into RNG, methane from animal waste and other biomass sources (that otherwise would have entered directly into Earth`s atmosphere) is instead combusted as RNG, resulting in the release of GHG that are materially less potent than methane released directly into the atmosphere. The use of RNG

represents the recycling of carbon that is already circulating in the environment, whereas burning a fossil fuel represents the release of new carbon emissions that were previously sequestered in the earth.

There is substantial carbon reduction by replacing conventional natural gas with RNG sourced from landfills and wastewater treatment plants. For RNG generated from food waste and dairy farm anaerobic digesters there is additional carbon emissions reductions associated with landfill diversion and methane emission avoidance due to improved manure management at farms. The GHG benefits of renewable natural gas are depicted in the schematic below.

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Sources: American Gas Association, United States Environmental Protection Agency, MJB&A

Overview of Biogas and RNG

Biogas is a renewable source of methane gas (the main component in natural gas) created when organic matter is broken down in an oxygen-free environment through AD. The biogas is captured in the head space of the digestor then piped to a biogas blower which feeds the upgrading plant. While the precise composition of biogas is dependent on the feedstock, the methane content of biogas typically ranges from 45% to 75% by volume, with the remaining portion largely comprised of CO2, and has a Higher Heating Value (“ HHV ”) between 16 MJ per cubic metre (MJ/m[3] ) and 28 MJ/m[3] , allowing it to be directly used to produce electricity, heat, or as an energy source for cooking.

RNG is a near-pure source of methane produced either by upgrading biogas (a process which removes CO2 and other contaminants present) or through the gasification of solid biomass followed by methanation as described below:

Upgrading Biogas : This accounts for around 90% of total RNG produced worldwide. Upgrading technologies make use of the different properties of the various gases contained within biogas to separate them, with water scrubbing and membrane separation accounting for almost 60% of biomethane production globally.
Thermal Gasification of Solid Biomass Followed by Methanation : While this technology is still precommercial, it shows promise as a substantial medium to long term source of RNG. Woody biomass is first broken down at high temperature (between 700-800°C) and high pressure in a low-oxygen or oxygen-free environment. Under these anaerobic or near-anaerobic conditions, the biomass is converted into a mixture of gases, mainly carbon monoxide, hydrogen and methane (collectively, “ Syngas ”). This Syngas is then cleaned to remove any acidic and corrosive components. The methanation process then involves the use of a catalyst to promote a reaction between the hydrogen and carbon monoxide or CO2 to produce methane. This methane gas is then treated and upgraded in a biogas treatment plant or facility to produce RNG of a grade and quality that meets the pipeline and utility specifications.

Biomethane has a HHV of around 36 MJ/m[3] and is indistinguishable from natural gas allowing it to be used without the need for any changes in natural gas transmission and distribution infrastructure or end-user equipment and is fully compatible for use in natural gas vehicles.

Biogas and biomethane production pathways are depicted in the schematic below.

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Source: International Energy Agency: Outlook for biogas and biomethane

Understanding Anaerobic Digestion

AD is a process where bacteria breaks down organic matter (wastewater biosolids, food wastes and animal manure) in the absence of oxygen. The process takes place in a sealed vessel called a reactor. The reactors contain complex microbial communities that break down the waste, producing biogas and digestate (the solid and liquid material endproducts which can be used in other beneficial applications) that is discharged from the digester.

Multiple organic materials can be combined in a single digestor (co-digestion) which can include manure, food waste (i.e. processing, distribution and consumer generated materials), energy crops, crop residues, and fats, oils, and greases among many other sources. In certain situations, co-digestion can increase biogas production from low-yielding or difficult to digest organic waste.

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Notes:

(1) Feedstock is supplied to the anaerobic digester which contains bacteria that breaks down organic matter in the absence of oxygen.
(2) Following the reaction, the anaerobic digester produces biogas and digestate.

(3) Biogas is then upgraded to RNG (aka biomethane) for use in the gas grid.
(4) The digestate discharged provides solid and liquid end-products that can then be used in other applications.

Source: American Biogas Council and United States Environmental Protection Agency

General types of AD technology include:

Covered Anaerobic Lagoon Digester : In-ground lagoons can be sealed with a flexible cover to recover biogas. These systems are typically located at farms and tend to be large compared to other AD technologies. Lagoon anaerobic digesters are typically unheated, which leads to seasonal biogas generation due to colder ambient winter temperatures.
Plug Flow Digester : A concrete tank with a rigid or flexible cover. The tank is built partially or fully below grade to decrease the demand for supplemental heat. Plug flow digesters are used at dairy operations that collect manure by scraping or flushing.
Complete Mix Digester : Enclosed, heated tank with a mechanical, hydraulic, or gas mixing system. Complete mix digesters work best when there is some dilution of the excreted manure with water (e.g., milking center wastewater).
High Solids Digester : Horizontal plug flow digesters made of concrete and steel. Dry digesters operate at 15% to 25% total solids and use slowly rotating paddles on a center shaft to slowly move material through the process.

Source: American Biogas Council and United States Environmental Protection Agency

Sources of RNG

Currently, there are at least six main sources of biogas used in North America to produce RNG which include:

Municipal Solid Waste Landfills : Food, green waste, paper, cardboard and wood.
Source Separated Organics : Green Bin materials separated by households and businesses to divert organics from landfills.
Municipal Water Resource Recovery Facilities : Semi-solid organic matter recovered in the form of sewage gas from municipal wastewater treatment plants.
Industrial, Commercial and Institutional Food Waste: Spoiled food collected and diverted from landfills.
Livestock : Manure from livestock (cattle, poultry, etc.).
Crop Residues : Residues from the harvest of wheat, maize, rice, other coarse grains, sugar beet, sugar cane, soybean and other oilseeds.

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Average biogas production by feedstock type is depicted in the schematic below.

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Source: International Energy Agency: Outlook for biogas and biomethane

In Canada, emissions from organics can be used to produce RNG and remove GHGs:

Landfill Capture: Landfills in Canada currently generate 30.0 MT of eCO2 and there is significant opportunity to reduce emissions with gas capture systems.
Manure and Crop Residuals : Potential to reduce approximately 13.0 MT of eCO2 annually from Canadian manure and crop waste.
Food Waste: Potential to reduce approximately 1.4 MT of eCO2 annually through diverting ~50% of Canadian food waste.

Wastewater Treatment : Potential to reduce approximately 2.8 MT of eCO2 annually by capturing biogas in Canadian wastewater treatment facilities.

Sources: Canadian Gas Association, Canadian Biogas Association

Uses of RNG

Based on estimates from the IEA, approximately two-thirds of biogas production in 2018 was used to generate electricity and heat (approximately evenly split between electricity and heat). Buildings, mainly in the residential sector for cooking and heating, consume approximately 30%, with the remainder upgraded to RNG and blended into the gas networks or used as a transport fuel. Currently, there is approximately 18 GW of installed power generation capacity running on biogas around the world, largely located in Germany, the United States and the United Kingdom, with capacity increasing on average 4% per year between 2010 and 2018. Looking ahead, United Sates gas utilities such as Southern California Gas Company and NW Natural have set a target of 20% by 2030 and 5% by 2025, respectively, of RNG blended into natural gas streams.

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In Canada, the Canadian Gas Association has set a target of 5% renewable gas (RNG or hydrogen) blended into natural gas streams by 2025 and 10% by 2030. Canadian gas utilities such as FortisBC and Énergir have set similar targets, 15% by 2030 and 20% by 2030, respectively. For scale, domestic sales of natural gas totaled 3.438 trillion cubic feet in Canada in 2019 according to the Canadian Gas Association. Nationally, the increased renewable gas content would result in 14 MT of GHG emission reductions per year by 2030, equivalent to removing 3.1 million passenger cars from the road. RNG consumption is expected to increase from 3 Mtoe in 2018 to 75 Mtoe in 2040, a compound annual growth rate of 16%.

The rise of RNG is not isolated to Canada alone, with policy support and feedstock availability driving additional supply and demand globally. Furthermore, while the industry is currently in its early stages, the potential to deliver clean energy to a wide array of end users using existing infrastructure is particularly attractive. Despite, RNG development being uneven across the globe, given feedstock availability and policies, with Europe, China and North America accounting for ~90% of global production, consumption is expected to materially increase from low levels in 2018 to approximately 200 Mtoe by 2040 under the IEA’s Sustainable Development Scenario, which models meeting in full the world’s goals to tackle climate change, improve air quality and provide access to modern energy.

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The North American outlook for global methane consumption under the IEA’s Sustainable Development Scenario is set out in the graph below (in PJ).

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Sources: Canadian Gas Association and International Energy Agency: Outlook for biogas and biomethane; Southern California Gas Company; and NW Natural

FortisBC

In March 2017, the Province of British Columbia amended the Greenhouse Gas Reduction (Clean Energy) Regulation , prescribed under the Clean Energy Act , to include a renewable portfolio allowance of up to 5% RNG on the natural gas system by 2025, creating a strong opportunity for RNG supply in British Columbia and assistance in reducing GHG emissions. Currently, FortisBC has set a target to reduce customers’ GHG emissions 30% by 2030. RNG is expected to be a key component in achieving the GHG target with an aim to have 15% of FortisBC’s natural gas supply be renewable by 2030 (and 30% RNG deployment by 2050). At the end of 2020, FortisBC achieved energy sales totalling approximately $1.4 billion or the equivalent of 219 PJ.

Sources: FortisBC: 30BY30 target; FortisBC: Clean growth pathway to 2050 (February 2019)

British Columbia RNG Projects

There are currently five operating RNG facilities in British Columbia with an additional six under development that the Company is aware of. The majority of capacity, 245,000 GJ, is from digester facilities, with an additional 81,000 GJ produced from landfill sites. The province’s first wastewater treatment and gasification facilities are currently under development.

Set out below is a breakdown of such RNG facilities in British Columbia (current, in-development and proposed) and the energy produced or projected to be produced.

	Operational	In Development	Proposed
Upgraded Biogas
Digester	235,000 GJ (3 facilities)(1)	110,000 GJ (1 facility)	N/A
Landfill	81,000 GJ (2 facilities)(2)	545,000 GJ (3 facilities)	N/A
Wastewater	N/A	120,000 GJ (1 facility)	N/A
Subtotal	316,000 GJ (5 facilities)	775,000 GJ (5 facilities)	N/A
Gasification	N/A	1,000,000 GJ (1 facility)	1 facility
Total	316,000 GJ (5 facilities)	1, 775,000 GJ (6 facilities)	1 facility

Notes:

(1) The three operational digester facilities are: (i) Fraser Valley Biogas, located in Abbotsford, British Columbia; (ii) Seabreeze Farms, located in Delta, British Columbia; and (iii) Surrey Biofuels, located in Surrey, British Columbia. The substrates at Fraser Valley Biogas and Seabreeze Farms are manure and biowaste, while the substrate at Surrey Biofuels is sewage sludge.

(2) The two operational landfill facilities are: (i) Salmon Arm Landfill, located in Salmon Arm, British Columbia; and (ii) Glenmore Landfill, located in Kelowna, British Columbia. The substrate at both Salmon Arm Landfill and Glenmore Landfill is landfill gas.

Sources: Canada Energy Regulator; Canadian Gas Association; and FortisBC.

Regulatory Frameworks

Increasingly, several jurisdictions in Canada both at a federal and provincial level are exploring and implementing favourable policies to incentivize the development of RNG in an effort to reach emission reduction targets. Additionally, utility companies such as FortisBC and Énergir are opting to implement their own voluntary plans to increase the use of RNG as part of their corporate strategies to reduce greenhouse gas emissions. As regulations and policies continue to evolve in an effort to reach emission reduction targets, the frameworks proposed and implemented are increasingly becoming favourable to the development of RNG projects.

Government of Canada

The Government of Canada has been working on a Clean Fuel Standard (“ CFS ”) that would mandate solid, liquid, and gaseous fuel distributors to lower the emission intensity of their product. The CFS is intended to drive investment and growth in Canada’s clean fuel sector by increasing incentives for the development and adoption of clean fuels and technologies and processes, with the aim to significantly reduce pollution. The CFS will require liquid fuel (gasoline, diesel and home heating oil) suppliers to gradually reduce the carbon intensity of the fuels they produce and sell for use in Canada over time, leading to a decrease of approximately 13% (below 2016 levels) in the carbon intensity of liquid fuels used in Canada by 2030.

Additionally, the Government of Canada established the Hydrogen Strategy for Canada in 2020 as part of an ambitions framework to reach net-zero emissions by 2050. The framework will focus on high potential projects and sites across the country including RNG facilities with the potential to mix hydrogen with RNG for injection into the natural gas networks. The federal government also established a $182.5 million program to fund alternative fuel infrastructure. The program intends to pay up to 50% of project costs to a maximum of $1 million for alternative fuel stations.

Sources: Government of Canada, the Hydrogen Strategy for Canada and the Electric Vehicle and Alternative Fuel Infrastructure Deployment Initiative.

Ontario

Following the repeal of the Green Energy and Green Economy Act, 2009 , there has not been a clear legislative mandate or financial incentives supporting RNG projects. However, the Ontario government intends to develop and implement a regulation that bans the disposal of food and organic waste under the Environmental Protection Act (1990), preventing disposal into landfills and incineration facilities, which in turn should create new opportunities for resource recovery approaches and investments.

Separately, the City of Toronto has implemented strategies supportive of RNG use. The City of Toronto in partnership with Enbridge Inc. approved a strategy to produce approximately 3.3 million cubic meters of RNG from Toronto’s green bin organic waste for injection into Enbridge Inc.’s natural gas network. Once in the network, the City will blend RNG with purchased natural gas to fuel city owned vehicles and heat buildings. This closed loop strategy is intended to fuel organic waste collection trucks with RNG from the organic waste collected while supporting the City’s waste management and climate action strategies.

Sources: City of Toronto, Turning Waste into Renewable Natural Gas; QUEST, Canadian Gas Association, and TAF: Renewable Natural Gas (RNG) Handbook

British Columbia

On the back of modifications to the Greenhouse Gas Reduction (Clean Energy) Regulation , the British Columbia Utilities Commission has set out a voluntary program in which gas distributors may choose to include renewable energy in their portfolio with a cap of 5% RNG of the total natural gas system. Currently, FortisBC (the largest provider of gas in the province), has allowed customers the option to allocate 5% to 100% of their natural gas use as RNG. Additionally, the utility has been provided authority from the provincial regulator to pay up to $30/GJ for pipeline quality and purified biomethane with in-province projects prioritized for supply contracts. As mentioned previously, FortisBC has a target to achieve 15% of its total natural gas throughput in its piping network to be renewable low carbon sources by 2030 (and by 30% by 2050), in addition, FortisBC is also targeting a 30% reduction in GHG emissions by 2030. Given the demand for RNG in the province, the British Columbia Utilities Commission provided approval in 2020 to FortisBC to sign RNG supply agreements with suppliers in Alberta and Ontario.

Sources: FortisBC: 30BY30 target; FortisBC: Clean growth pathway to 2050 (February 2019); and British Columbia Utilities Commission.

Québec

In its 2030 Energy Policy, the Québec Government has set targets to increase renewable energy production by 25%, through an increase of bioenergy production by 50%, including RNG, by 2030. Bill 106, An Act to implement the 2030 Energy Policy and to amend various legislative provisions , allows the province to implement its energy transition master plan. Among other things, Bill 106 amends the Act respecting the Régie de l’énergie , providing new measures regarding the distribution of RNG. In March 2019 the Québec government adopted the Regulation respecting the quantity of renewable natural gas to be delivered by a distributor , which sets the minimum quantity of RNG produced in Québec and to be injected by a natural gas distributor at 1% of the total quantity of natural gas the distributor distributes as of 2020, and progressively increases that quantity to set it at 5% of the total quantity of natural gas distributed as of 2025.

Furthermore, the province offers subsidies (up to 66% of the capital costs) for municipal RNG projects through the Processing Organic Matter Using Biomethanization and Composting (PTMOBC) program, which has been in place since 2009 and aims to reduce the organic materials in landfills and GHG emissions. In 2020, the Québec Government also established plans to spend $1.2 billion to better manage organic waste over the next 10 years with targets established to have 70% of organic waste composted by 2030.

Sources: Québec Government, Québec Residual Materials Management Policy; Énergir

Alberta

In 2016, the Alberta government announced the Bioenergy Producer Program (BPP) to allow producers to transition from bioenergy programs that were in place from 2006 to 2016. The program was subsequently extended from October 1, 2017, to March 31, 2020, with a revised scope and with the intention to reduce GHG emissions and create economic benefits. Currently, there have been no new updates regarding the program.

Source: Government of Alberta

Specialized Skills and Knowledge

The nature of the Company’s business requires specialized skills, knowledge and technical expertise in the areas of compost and RNG development, construction and operations.

The EverGen management team has decades of combined experience in the development, design, construction and operation of biogas facilities that produce RNG and renewable electricity. The Company believes that its management team’s proven track record and focus on development of RNG projects gives it a strategic advantage in continuing to grow the business profitably. The Company has targeted personnel with diverse experience and the integration of key technical, environmental, and administrative support functions support its ability to design and operate projects with sustained and predictable cash flows. See “ Directors and Officers ”.

EverGen works with technology providers with proven track records in the applications required. EverGen also works with leading engineering companies to base project designs on the most suitable equipment and technology for the specific application, including materials handling, digestion and gas upgrading technologies. The Company is actively engaged in each project’s development, construction management, start-up and operation. For the acquisition of existing projects, EverGen leads due diligence and works with experienced engineering and construction companies to estimate the economics and risk for project enhancements. This allows EverGen to develop a comprehensive understanding of each project’s current operational performance and also determine the most attractive system improvements.

In addition to the specialized skills listed above, the Company also relies on staff members, contractors and consultants with specialized knowledge of logistics and operations. In order to attract and retain personnel with the specialized skills and knowledge required for the Company’s operations, the Company maintains competitive remuneration and compensation packages. To date, the Company has been able to meet its staffing requirements.

Employees

Consistent with EverGen’s strategy to consolidate and integrate RNG facilities under a common lean operating platform, the Company directly employs five employees focused on management at the platform level and on realizing synergies in development and operations, and through and together with the employees of the Acquired Businesses, has a total of 30 employees.

See “ Directors and Executive Officers ”.

Social and Environmental Policies

EverGen was established for the purposes of contributing to a circular economy in waste recycling and waste to energy production through sourcing, operating and developing sustainable infrastructure, and fulfilling the Company’s ESG values. The Company places great emphasis on providing a safe and secure working environment for all of its employees, contractors and consultants, and recognizes the importance of operating in a sustainable manner. On March 18, 2021 the Company adopted the Code of Business Conduct and Ethics of the Company (the “ Code ”), which sets out its purpose and the standards that guide the conduct of its business and the behaviour of its directors, officers, employees and consultants. All new employees must read and acknowledge that they will abide by the Code when hired. The Code, among other things, sets out standards in areas relating to the Company’s commitment to safety and sustainability in its business operations and the identification, elimination or control of workplace hazards; promotion and provision of a work environment in which individuals are treated with respect, provided with equal opportunity and is free of all forms of discrimination and abusive and harassing conduct; and ethical business conduct and legal compliance.

EverGen’s executive team places the highest priority on the health and safety of its staff and third parties at its sites, as well as the preservation of the environment. The Company’s corporate culture is built around supporting these priorities, as reflected in its well-established practices and policies. EverGen’s high safety standards include active monitoring of all field workers, performing environmental, health and safety (“ EHS ”) audits and using technology

throughout its safety processes from employee training in compliance with operational processes and procedures to emergency preparedness. By extension, the Company incorporates its EHS standards into its subcontractor selection qualifications to ensure that its commitment to high EHS standards is shared by its subcontractors and stakeholders.

The Board has also established a Safety and Sustainability Committee to assist the Board in fulfilling its oversight responsibilities relating to operating in a safe, environmentally and socially responsible (sustainable) manner and ensuring the integrity of policies and practices with respect to: workforce and public safety in Company activities and at its operating sites; and sustainability in Company activities with respect to people (wellbeing), planet (environmental) and prosperity (community and innovation) considerations. In particular, the Safety and Sustainability Committee is responsible for, among other things: reporting to the Board on matters and items related to the safety and sustainability program of the Company; ensuring that there are appropriate processes in place to facilitate identification of various safety and sustainability risks that may arise from the Company’s operations and related mitigation and possible resulting consequential risks to the Company, its subsidiaries and directors, officers and employees; assessing whether the Company’s safety and sustainability policies are effective, properly implemented and comply with applicable legislation and industry standards; reviewing corporate safety and sustainability activities and performance; reviewing the Company’s method of communicating (internally and externally) safety and sustainability policies, practises and procedures; reviewing and assessing the sufficiency of resources to the Company’s safety and sustainability program; ensuring that appropriate reporting procedures are established relating to safety and sustainability matters by management to ensure adequate reports are made to the chair of the Safety and Sustainability Committee on a regular basis; reviewing insurable risks related to safety and sustainability issues; evaluating adequacy of insurance coverage; and performing any other activities consistent with the Safety and Sustainability Committee’s mandate and generally, covering laws as the Safety and Sustainability Committee or Board deems necessary or appropriate.

The Company has also adopted a Whistleblower Policy for individuals to report complaints and concerns regarding, among other things, accounting, internal accounting controls and auditing matters.

USE OF PROCEEDS

Proceeds of the Offering

The estimated net proceeds to the Company from the Offering will be $17,818,800, after deducting the Underwriters’ Fee of $1,201,200 and estimated expenses of the Offering of $1,000,000 , and assuming the Over-Allotment Option is not exercised. If the Underwriters exercise the Over-Allotment Option in full, the estimated net proceeds from the Offering will be $20,641,620 after deducting the Underwriters’ Fee of $1,381,380 and estimated expenses of the Offering of $1,000,000. The foregoing assumes there are no sales under the President’s List.

Principal Purposes of the Offering Proceeds

The Company intends to use the net proceeds of the Offering as follows:

Principal Purposes Project Construction, Development, Acquisition and Expansion Working Capital Total	Net Proceeds under Offering
	$17,318,800 $500,000 $17,818,800

18 month period. Proceeds raised pursuant to the exercise of the Over-Allotment Option, if any, are intended to be allocated to Project Construction, Development, Acquisitions and Expansion.

Until applied, the net proceeds of the Offering will be held by the Company as cash balances in an interest-bearing account or invested in certificates of deposit and other instruments issued by major Canadian banks or a government authority in the discretion of management of the Company.

Total Funds Available

The Company expects to have approximately $20,603,800 in available funds following the completion of the Offering, based on the (i) net proceeds (assuming no exercise of the Over-Allotment Option) of $17,818,800, (ii) approximately $2,785,000 in estimated working capital as at June 30, 2021.

The Company intends to use the total funds available as follows:

Use of Available Funds Project Construction, Development, Acquisitions and Expansion Working Capital Total Use of Available Funds	Approximate Amount $20,103,800 $500,000 $20,603,800	Approximate Amount (If Over-Allotment Option is exercised)
		$22,926,620 $500,000 $23,426,620

The Company intends to use the total funds available to (i) acquire, develop, build, own and operate renewable natural gas, clean gas and other associated waste to energy infrastructure projects; and (ii) expand, develop and convert the Company’s existing assets. Additionally, the Company will be looking to capitalize on a fragmented market through the consolidation of other opportunities, by evaluating new project sites and strategic acquisitions and partnerships.

If the Over-Allotment Option is exercised in full, the Company will receive additional net proceeds of $2,822,820 after deducting the Underwriters’ Fee. The net proceeds from the exercise of the Over-Allotment Option, if any, is expected to be added to Project Construction, Development, Acquisitions and Expansion.

While the Company intends to spend the net proceeds from the Offering and other funds available to it as stated above, there may be circumstances where, for sound business reasons, funds may be re-allocated at the discretion of the Board or management. See “ Risk Factors – Risks Related to the Offered Units – The Company May Not Use the Proceeds from the Offering and other Available Funds as Described in this Prospectus ”. The Company is currently in discussions with its existing and other potential lenders to secure additional debt financing in order to progress the business objectives and milestones of the Company. While the Company believes that discussions and negotiations will result in additional debt financing being made available, there is no assurance that any definitive agreement will be reached or that such additional financing will be available on favourable terms, acceptable to the Company, or at all. The Company also anticipates that operating cash flow and the potential to secure government grants related to renewable energy projects will provide additional sources of funds for the Company to achieve its development and expansion plans and other business objectives, however there is no assurance that any such amounts will be available or sufficient to achieve all of the Company’s intended milestones. See “ Risk Factors – Risks Related to the Offered Units – The Company will require other available funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations ”.

Business Objectives and Milestones

The primary business objectives that the Company expects to accomplish by using the net proceeds from the Offering and other funds available to it over the next 18 months are as follows:

Progressing the development and construction of existing portfolio of RNG expansion projects
Optimization, diversification and expansion of existing organic waste processing capabilities (RNG feedstock)
Continuing the growth of its project portfolio via strategic acquisitions and consolidation opportunities
Developing strategic partnerships and advance RNG project pipeline

The timing of the Company’s use of the net proceeds received in this Offering and other funds available to the Company may vary significantly depending on numerous factors. The net proceeds of the Offering together with other available and expected funds (project level debt, government grants and cash flow from operations) will allow the Company to achieve each of the above noted business objectives on the following basis.

It is estimated that the Company will need to deploy a significant portion of the net proceeds received in connection with the events listed above (and if the Over-Allotment Option is exercised in full, the Company will attribute additional capital to the events above). The Company also anticipates that any excess funds available would be allocated to working capital requirements. See “ General Development and Business of the Company – General Development of the Company – Future Business Acquisitions ”.

While the Company has experienced no material impact to its operations resulting from the ongoing COVID-19 pandemic, it cannot estimate the duration and severity of the COVID-19 pandemic and its ultimate financial impact. The Company continues to work with stakeholders to responsibly address the impact of the global pandemic on operations, and continues to monitor the situation, to assess possible implications to the business, and to take actions in an effort to mitigate adverse consequences. See “ Risk Factors – Risks Related to the Company – COVID-19 May Further Disrupt the Business of the Company ”.

PLAN OF DISTRIBUTION

Offered Units

Pursuant to the Underwriting Agreement, the Company has agreed to sell and the Underwriters have severally, and not jointly or jointly and severally, agreed to purchase on the Closing Date an aggregate of 3,080,000 Offered Units at the Offering Price for aggregate gross proceeds to the Company of $20,020,000, payable in cash to the Company against delivery of the Offered Units on the Closing Date, subject to compliance with all legal requirements and the terms and conditions contained in the Underwriting Agreement. This Prospectus qualifies the distribution of Offered Units.

Each Offered Unit will consist of one Unit Share and one-half of one Warrant. Each Warrant will entitle the holder to acquire, subject to adjustment in accordance with the Warrant Indenture, one Warrant Share at an exercise price of $10.50 at any time prior to 5:00 p.m. (Vancouver time) on the Expiry Date. The Warrants will be created and issued pursuant to the terms of the Warrant Indenture to be entered into between the Company and TSX Trust Company. The Warrant Indenture will contain provisions designed to protect the holders of Warrants against dilution upon the happening of certain events. For a summary of the material attributes and characteristics of the Unit Shares and Warrants comprising the Offered Units and certain rights attaching thereto, see “ Description of Securities Being Distributed ”.

The Offering Price has been determined by arm’s length negotiation between the Company and the Co-Lead Underwriters, on behalf of the Underwriters based on several factors, such as prevailing market conditions; the capital structure of the Company; estimates of the Company’s business potential and earnings prospects; an overall assessment of the Company’s management; and the consideration of these factors in relation to market valuations of companies in related businesses, and may bear no relationship to the price that will prevail in the public market.

The Company has granted the Underwriters the Over-Allotment Option, exercisable, in whole or in part, at the sole discretion of the Underwriters, at any time prior to the Over-Allotment Deadline, to purchase up to 462,000 OverAllotment Units, which is equal to 15% of the aggregate number of Offered Units sold pursuant to the Offering at the Offering Price, to cover over-allotments, if any, and for market stabilization purposes. The Over-Allotment Option is exercisable by the Co-Lead Underwriters, on behalf of the Underwriters, by giving notice to the Company prior to the Over-Allotment Deadline, which notice shall specify the number of Over-Allotment Securities to be purchased. The Over-Allotment Option may be exercised to acquire (i) Over-Allotment Units at the Offering Price, or (ii) OverAllotment Shares at a price of $6.32 per Over-Allotment Share, or (iii) Over-Allotment Warrants at a price of $0.18 for each one-half of one Over-Allotment Warrant, or (iv) any combination of Over-Allotment Units, Over-Allotment Shares and Over-Allotment Warrants, so long as the aggregate number of Over-Allotment Shares and Over-Allotment Warrants that may be issued under the Over-Allotment Option does not exceed 462,000 Over-Allotment Shares and 231,000 Over-Allotment Warrants. If the Underwriters exercise the Over-Allotment Option in full, the gross proceeds raised under the Offering will be $23,023,000, the Underwriters’ Fee will be $1,381,380 (assuming there are no sales under the President’s List), and the net proceeds to the Company will be $21,641,620 (before deducting expenses of the Offering). This Prospectus qualifies the grant of the Over-Allotment Option and the distribution of the OverAllotment Securities issuable upon exercise of the Over-Allotment Option. A purchaser who acquires securities forming part of the Underwriters’ over-allocation position acquires those securities under this Prospectus, regardless of whether the over-allocation position is ultimately filled through the exercise of the Over Allotment Option or secondary market purchases.

The obligations of the Underwriters under the Underwriting Agreement are several (and not joint or joint and several), are subject to certain closing conditions, and may be terminated at the Underwriters’ discretion at any time prior to the Closing Date on the basis of “material change out”, “market out”, “disaster out”, “litigation and regulatory out” “compliance with conditions out”, and “due diligence out” clauses in the Underwriting Agreement, in addition to termination upon the occurrence of certain other stated events. The Company has agreed in the Underwriting Agreement to indemnify each of the Underwriters and their respective subsidiaries and affiliates and their respective directors, officers, employees, agents, partners and shareholders against certain liabilities and expenses or will contribute to payments that the Underwriters or such other parties may be required to make in respect thereof.

In consideration for the Underwriters’ services in connection with the Offering, the Underwriting Agreement provides that the Company will pay the Underwriters’ Fee to the Underwriters, which is equal to 6% of the gross proceeds of those Offered Units purchased pursuant to the Offering, inclusive of the Over-Allotment Option. Notwithstanding the foregoing, a reduced Underwriters’ Fee of 3% will be paid with respect to Offered Units sold to purchasers from the President’s List. The Company and the Co-Lead Underwriters, on the behalf of the Underwriters, have agreed that aggregate participation from the President’s List shall not exceed 5% of the Offering.

The Underwriters propose to offer the Offered Units initially at the Offering Price. After the Underwriters have made a reasonable effort to sell all of the Offered Units at the Offering Price, the price at which the Offered Units are distributed pursuant to the Prospectus may be decreased and may be further changed from time to time to an amount not greater than the Offering Price, and the compensation realized by the Underwriters will be decreased by the amount that the aggregate price paid by purchasers for the Offered Units is less than the aggregate proceeds of the Offered Units. Any such reduction in price will not affect the net proceeds to be received by the Company.

Subscriptions for the Offered Units will be received subject to rejection or allotment, in whole or in part, and the Underwriters reserve the right to close the subscription books at any time without notice. All subscription funds received by the Underwriters will be held in trust, pending the Closing. It is expected that the Closing will take place on or about ●, 2021 or such other date as the Company and the Underwriters may agree, but in any event, on or before a date that is not later than 42 days after the date of the receipt for the (final) prospectus, unless an amendment to this Prospectus is filed and a receipt has been issued for such amendment.

The Underwriters and/or their affiliates from time to time may provide in the future, investment banking, financial advisory, broker-dealer and commercial banking services to the Company and their subsidiaries and affiliates in the ordinary course of business for which they have received, or may receive, customary fees and commissions.

Market Stabilization Activities

Pursuant to the rules and policy statements of certain Canadian securities regulators, the Underwriters may not, at any time during the period of distribution, bid for or purchase the Company’s securities for their own account or for accounts over which they exercise control or direction. The foregoing restrictions are subject to certain exceptions on the condition that the bid or purchase not be engaged in for the purpose of creating actual or apparent active trading in or raising the price of the Offered Units. These exceptions include a bid for or purchase of the Company’s securities: (i) made through the facilities of the TSX-V, in accordance with the Universal Market Integrity Rules of the Investment Industry Regulatory Organization of Canada relating to market stabilization and passive market making activities; (ii) made for or on behalf of a client, provided that the client’s order was not solicited during the distribution period; and (iii) to cover a short position entered into prior to the commencement of the distribution period. Subject to applicable laws and in connection with the Offering, the Underwriters may engage in market stabilization or market balancing activities on the TSX-V where the bid for or purchase of the Company’s securities is for the purpose of maintaining a fair and orderly market in such securities, subject to price limitations applicable to such bids or purchases. Such transactions, if commenced, may be discontinued at any time.

Offering Jurisdictions and Listing

The Offered Units are being offered for sale in the Qualifying Jurisdictions, by way of this Prospectus and in the United States on a private placement basis pursuant to available exemptions under applicable United States securities laws. Subject to compliance with applicable law, the Underwriters may also offer the Offered Units in such other jurisdictions outside of Canada and the United States, as agreed between the Company and the Underwriters.

There is currently no market through which the Unit Shares or Warrants comprising the Offered Units may be sold, and purchasers may not be able to resell the securities purchased under this Prospectus. This may affect the pricing of the securities in the secondary market, the transparency and availability of trading prices, the liquidity of the securities, and the extent of issuer regulation. See “ Risk Factors ”.

As at the date of this Prospectus, EverGen does not have any of its securities listed or quoted, has not applied to list or quote any of its securities, and does not intend to apply to list or quote any of its securities, on the Toronto Stock Exchange, Aequitas NEO Exchange Inc., a U.S. marketplace, or a marketplace outside of Canada and the United States of America (other than the Alternative Investment Market of the London Stock Exchange or the PLUS markets operated by PLUS Markets Group plc).

The Company has applied to list its Common Shares (including the Unit Shares and the Warrant Shares) on the TSXV. Listing is subject to approval by the TSX-V of the Company’s listing application and the Company fulfilling all of the requirements and conditions of the TSX-V, including distribution of Common Shares to a minimum number of public shareholders. The TSX-V has not conditionally approved the listing of the Common Shares (including the Unit Shares or the Warrant Shares) and there is no assurance that the TSX-V will approve the Company’s listing application. Closing of the Offering is conditional upon the aforementioned securities being approved for listing on the TSX-V. See “ Risk Factors ”.

Settlement

It is anticipated that the Company will arrange for one or more instant deposits of the Offered Units issued and sold hereunder with CDS or its nominee through the non-certificated inventory system administered by CDS on the Closing Date, or will otherwise duly and validly deliver the Offered Units as directed by the Underwriters on the Closing Date. Except in limited circumstances or as specifically required, no certificates will be issued to purchasers of the Offered Units and a purchaser will receive only a customer confirmation from a registered dealer that is a CDS participant and from or through which the Offered Units are purchased.

United States Securities Laws Matters

The Unit Shares and Warrants comprising the Offered Units and the Warrant Shares issuable upon exercise of the Warrants have not been and will not be registered under the U.S. Securities Act or any securities laws of any state of

the United States, and may not be offered or sold within the United States except in transactions exempt from the registration requirements of the U.S. Securities Act and all applicable state securities laws. The Underwriters have agreed that they will not offer or sell the Offered Units within the United States except pursuant to an exemption from the registration requirements of the U.S. Securities Act and pursuant to similar exemptions under applicable state securities laws. This Prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any Offered Units in the United States. The Underwriters may also offer and sell Offered Units outside the United States in accordance with Regulation S under the U.S. Securities Act. In addition, until 40 days after the commencement of the Offering, an offer or sale of the Offered Units within the United States by a dealer (whether or not participating in the Offering) may violate the registration requirements of the U.S. Securities Act unless such offer is made pursuant to an exemption from the registration requirements of the U.S. Securities Act.

Restrictions on Securities Distributions and Lock-Up Agreements

Pursuant to the Underwriting Agreement, the Company has agreed that it shall not directly or indirectly issue, sell, offer, grant an option or right in respect of (or agree to or announce any intention to do any of the foregoing) any additional Common Shares or any securities convertible or exchangeable into Common Shares or other equity securities of the Company for a period of 180 days after the Closing Date, without the prior written consent of the CoLead Underwriters, on behalf of the Underwriters, such consent not to be unreasonably withheld, other than pursuant to: (i) the Offering, including the Over-Allotment Option; (ii) the grant or exercise or settlement of Options, RSUs, PSUs or DSUs and other similar issuances pursuant to the Equity Incentive Plan or PSU Plan and any equity incentive plan of the Company or similar share compensation arrangements in place prior to March 29, 2021; (iii) obligations of the Company in respect of existing agreements in place prior to March 29, 2021; (iv) the exercise of outstanding warrants of the Company or the Special Warrants; or (v) the issuance of securities by the Company in connection with acquisitions in the normal course of business (for greater certainty this shall include securities issued pursuant to corporate and asset acquisitions).

Pursuant to the Underwriting Agreement, the Company has also agreed to use its best efforts to cause each of its senior officers and directors, and, as applicable, associates and affiliates, to enter into lock-up agreements in favour of the Underwriters, pursuant to which each will agree not to, directly or indirectly, offer, issue, sell, grant, secure, pledge, or otherwise transfer, dispose of or monetize, or engage in any hedging transaction, or enter into any form of agreement or arrangement the consequence of which is to alter economic exposure to, or announce any intention to do so, in any manner whatsoever, any Common Shares or securities convertible into, exchangeable for, or otherwise exercisable to acquire Common Shares or other equity securities of the Company for a period of 180 days after the Closing Date, without the prior written consent of the Co-Lead Underwriters on behalf of the Underwriters, such consent not to be unreasonably withheld, or subject to certain other limited exceptions as contained in the lock-up agreements. See “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer – Other Contractual Restrictions ”.

SELECTED HISTORICAL FINANCIAL INFORMATION AND PRO FORMA FINANCIAL INFORMATION

Selected Consolidated Financial Information of the Company

The following table sets out certain selected financial information of the Company for the period and as at the date indicated. This information has been derived from and is qualified in its entirety by the audited consolidated financial statements of the Company for the period from incorporation and commencement of operations on May 13, 2020 to December 31, 2020 and the unaudited consolidated financial statements of the Company for the three month period ended March 31, 2021, both included in this Prospectus. The Company prepares its financial statements in accordance with IFRS. Investors should read the following information in conjunction with those audited financial statements and related notes thereto, along with the consolidated MD&A of the Company and the Predecessor Entities, for the fiscal period ended December 31, 2020 and the unaudited consolidated financial statements and related notes thereto, along with the MD&A of the Company, for the three-month period ended March 31, 2021, all of which are included in this Prospectus.

	As at and for the	As at and for the
	three months ended	period ended
($000s exceptper share amounts)	March 31, 2021	December 31, 2020(1)
Current assets	18,827	6,979
Working capital surplus (deficit)(2)	11,579	(2,842)
Property and equipment	11,540	11,597
Intangible assets	20,571	20,960
Goodwill	10,974	10,974
Current liabilities	7,248	9,821
Shareholders’ equity	40,317	31,909
Gross profit	988	-
Net loss	(1,158)	(2,233)
Basic net loss per share	(0.13)	(17.05)
Diluted net loss per share	(0.13)	(17.05)
EBITDA(3)	(960)	(2,521)
Adjusted EBITDA(3)	203	-

Note:

(1) Period ended December 31, 2020 covers May 13, 2020, the Company’s date of incorporation, to December 31, 2020.

(2) Working capital is the measure of current assets less current liabilities and is a non-IFRS measure. See “ Non-IFRS Measures ”.

(3) EBITDA and Adjusted EBITDA are non-IFRS measures. See “ Non-IFRS Measures ”.

Selected Financial Information of the Predecessor Entities

The following table sets out certain selected financial information of Predecessor Entities for the periods and as at the dates indicated. This information has been derived from and is qualified in its entirety by the audited financial statements of each of the Predecessor Entities for the years ended December 31, 2020 and 2019 included in this Prospectus. The financial statements of the Predecessor Entities are prepared in accordance with IFRS. Investors should read the following information in conjunction with those audited financial statements and related notes thereto, along with the results of operation and financial results discussion of the Predecessor Entities in the consolidated MD&A of the Company and the Predecessor Entities, all of which are included in this Prospectus.

Selected Financial Information of NZWA

	As at and for the	As at and for the	As at and for the
	year ended		year ended
($000s exceptper share amounts)	December	31, 2020	December 31, 2019
Current assets		843	542
Working capital deficit(1)		(298)	(1,507)
Property and equipment		6,123	5,273
Current liabilities		1,141	2,049
Shareholders’ equity		3,733	1,681
Gross profit		2,986	2,054
Net income		1,094	746
Basic net income per share		1,094	746
Diluted net income per share		1,094	746
EBITDA(2)		2,063	1,420
Adjusted EBITDA(2)		2,280	1,969

Note:

(1) Working capital is the measure of current assets less current liabilities and is a non-IFRS measure. See “ Non-IFRS Measures ”.

(2) EBITDA and Adjusted EBITDA are non-IFRS measures. See “ Non-IFRS Measures ”.

Selected Financial Information of SSS

	As at and for the	As at and for the	As at and for the	As at and for the
	year ended		year ended
($000s exceptper share amounts)	December	31, 2020	December	31, 2019
Current assets		1,846		1,724
Working capital(1)		105		579
Property and equipment		5,308		4,233
Current liabilities		1,741		1,145
Shareholders’ equity		2,986		2,840
Gross profit		3,029		3,076
Net income		796		1,529
Basic net income per share		0.21		0.37
Diluted net income per share		0.21		0.37
EBITDA(2)		1,477		2,341
Adjusted EBITDA(2)		2,023		2,368

Note:

Selected Pro Forma Financial Information

The following table sets out certain selected financial information of the pro forma consolidated financial information of the Company for the period and as at the date indicated. This information has been derived from and is qualified in its entirety by the pro forma consolidated financial statements of the Company, as at December 31, 2020, which give effect to the Acquisitions of the Predecessor Entities, as if such Acquisitions had taken place on January 1, 2020 for the year ended December 31, 2020, and related notes thereto included in this Prospectus, and is based on the assumptions described in such notes. The pro forma consolidated statements are not necessarily indicative of the Company’s results that would have occurred if the events reflected had taken place on the dates indicated, nor does it purport to project the Company’s consolidated financial position or results for any future period. The selected pro forma consolidated financial information set out below should be read in conjunction with the description of the Acquisitions in this Prospectus, the pro forma consolidated financial statements and related notes thereto, and the audited financial statements of the Company and the Predecessor Entities and related notes thereto, included in this Prospectus.

	As at and for the
	year ended
	December 31,
($000s exceptper share amounts)	2020
Revenue	8,868
Gross profit	6,011
Operating costs	1,833
General and administrative expenses	1,153
Net loss before income taxes	(1,656)
Net loss	(1,540)
Basic net loss per share	(0.19)
Diluted net loss per share	(0.19)
EBITDA(1)	949
Adjusted EBITDA(1)	4,303

Note:

(1) EBITDA and Adjusted EBITDA are non-IFRS measures. See “ Non-IFRS Measures ”.

MANAGEMENT’S DISCUSSION AND ANALYSIS

Attached to this Prospectus at pages “F-2” to “F-31” and “F-124” to “F-143” are the following: (i) the consolidated MD&A of the Company and of the Predecessor Entities for: (a) the period from incorporation on May 13, 2020 to December 31, 2020 with respect to the Company; and (b) the two years ended December 31, 2020 and 2019 with respect to the Predecessor Entities; and (ii) the MD&A for the three-month period ended March 31, 2021 with respect to the Company on a consolidated basis.

The consolidated MD&A of the Company and of the Predecessor Entities should be read in conjunction with the respective financial statements and the accompanying notes thereto included in this Prospectus. Certain information contained in the consolidated MD&A constitutes forward-looking information. These statements relate to future events or to the Company’s future financial performance and involve known and unknown risks, uncertainties and other factors that may cause its actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance of achievements expressed or implied by such forward-looking information. See “ Statement Regarding Forward-Looking Information ” and “ Risk Factors ”.

DESCRIPTION OF SECURITIES BEING DISTRIBUTED

This Prospectus qualifies the distribution of up to 3,542,000 Offered Units (which includes up to 462,000 OverAllotment Units).

The Company’s authorized share capital consists of an unlimited number of Common Shares without par value, and an unlimited number of preferred shares without par value (“ Preferred Shares ”). As at the date of this Prospectus, there were 9,228,067 Common Shares issued and outstanding, nil Preferred Shares issued and outstanding, 1,059,325 Special Warrant Unit Shares and 529,662 Special Warrant Unit Warrants issuable pursuant to Special Warrants, 529,662 Special Warrant Shares issuable pursuant to Special Warrant Unit Warrants, 600,000 Common Shares issuable pursuant to outstanding PSUs, 195,000 Common Shares issuable pursuant to Options, 117,500 Common Shares issuable pursuant to RSUs, 27,500 Common Shares issuable pursuant to DSUs, 277,020 Broker Compensation Options issued and outstanding, 62,976 Finder Compensation Options issued and outstanding, 22,686 Broker Options issued and outstanding, and 6,750 Finder Warrants issued and outstanding.

Common Shares

All of the Common Shares rank equally as to voting rights, participation in a distribution of the assets of the Company on a liquidation, dissolution or winding-up of the Company and entitlement to any dividends declared by the Company. The holders of the Common Shares are entitled to receive notice of, and to attend and vote at, all meetings of shareholders (other than meetings at which only holders of another class or series of shares are entitled to vote). Each Common Share carries the right to one vote. In the event of the liquidation, dissolution or winding up of the Company or other distribution of assets of the Company among its shareholders for the purpose of winding-up its affairs or upon a reduction of capital, and after the holders of the Preferred Shares have received payment of the amounts to which they are entitled, the holders of the Common Shares will be entitled to receive equally on a per share basis, the amount paid up on the Common Shares together with any declared but unpaid dividends. Thereafter, the holders of the Common Shares will be entitled to share among themselves equally on a per share basis in any further distribution of the property or assets of the Company. The holders of Common Shares are entitled to receive dividends as and when declared by the Board in their absolute discretion in respect of the Common Shares. The Common Shares do not have pre-emptive rights, conversion rights or exchange rights and are not subject to redemption, retraction, purchase for cancellation or surrender provisions. There are no sinking or purchase fund provisions, no provisions permitting or restricting the issuance of additional securities or any other material restrictions, and there are no provisions which are capable of requiring a security holder to contribute additional capital. For a description of the Company’s dividend policy, see “ Dividend Poli c y ”.

Any alteration of the rights, privileges, restrictions and conditions attaching to the Common Shares under the Company’s Articles must be approved by at least two-thirds of the Common Shares voted at a meeting of the Company’s shareholders.

Warrants

The following is a summary of the principal attributes of the Warrants and certain anticipated provisions of the Warrant Indenture. The summary does not purport to be complete and is qualified in its entirety by the detailed provisions of the Warrant Indenture. A copy of the Warrant Indenture may be obtained on request from the Company’s corporate secretary and will be available electronically at www.sedar.com and reference should be made to the Warrant Indenture for the full text of the attributes of the Warrants.

Each Warrant will entitle the holder thereof to purchase, subject to adjustment in certain circumstances, one Warrant Share at a price of $10.50 at any time prior to 5:00 p.m. (Vancouver time) on the Expiry Date. See “ Plan of Distribution ”.

The Warrants will be governed by the Warrant Indenture to be entered into between the Company and TSX Trust Company (the “ Warrant Agent ”). The Company will designate the Warrant Agent, at its principal office in Vancouver, British Columbia, as agent for the Warrants.

The Warrant Indenture will provide for adjustment in the number of Warrant Shares issuable upon the exercise of the Warrants and/or the exercise price per Warrant Share upon the occurrence of certain events, including:

i. the issuance of Common Shares or securities exchangeable for or convertible into Common Shares to all or substantially all of the holders of Common Shares by way of a stock dividend or other distribution (other than a dividend paid in the ordinary course or a distribution of Common Shares upon the exercise of any outstanding warrants, options or other incentive securities of the Company);
ii. the subdivision, redivision or change of the Common Shares into a greater number of shares;
iii. the consolidation, reduction or combination of the Common Shares into a lesser number of shares;
iv. the issuance to all or substantially all of the holders of Common Shares of rights, options or warrants under which such holders are entitled, during a period expiring not more than 45 days after the record date for such issuance, to subscribe for or purchase Common Shares, or securities exchangeable for or convertible into Common Shares, at a price per Common Share to the holder (or at an exchange or conversion price per share) of less than 95% of the “current market price”, as defined in the Warrant Indenture, of Common Shares on such record date; and
v. the issuance or distribution to all or substantially all of the holders of Common Shares of securities, including rights, options or warrants to acquire shares of any class or securities exchangeable or convertible into any such shares or property or assets and including evidences of indebtedness, or any property or other assets.

The Warrant Indenture will also provide for adjustment in the class and/or number of securities issuable upon the exercise of the Warrants and/or exercise price per security in the event of the following additional events:

i. the reclassification of the Common Shares;
ii. the amalgamation, arrangement or merger of the Company with or into any other corporation or other entity (other than an amalgamation, arrangement or merger which does not result in any reclassification of the Company’s outstanding Common Shares or a change of the Common Shares into other shares); or
iii. the transfer of the Company’s undertakings or assets as an entirety or substantially as an entirety to another corporation or other entity.

No adjustment in the exercise price of the Warrants or number of Warrant Shares will be required to be made unless the cumulative effect of such adjustment or adjustments would result in a change of at least 1% in the exercise price

or a change in the number of Warrant Shares purchasable upon exercise by at least one one-hundredth (1/100th) of a Common Share, as the case may be.

The Company will covenant in the Warrant Indenture that, during the period in which the Warrants are exercisable, the Company will give notice to Warrant holders of certain stated events, including events that would result in an adjustment to the exercise price for the Warrants or the number of Warrant Shares issuable upon exercise of the Warrants, at least 14 days prior to the record date or effective date, as the case may be, of such event.

No fraction of a Warrant Share will be issued upon the exercise of a Warrant and no cash payment will be made in lieu thereof. Warrant holders are not entitled to any voting rights or pre-emptive rights or any other rights conferred upon a person as a result of being a holder of Common Shares.

From time to time, the Company and the Warrant Agent, without the consent of the holders of Warrants, may amend or supplement the Warrant Indenture for certain purposes, including curing defects or inconsistencies or making any change that does not adversely affect the rights of any holder of Warrants. Any amendment or supplement to the Warrant Indenture that adversely affects the interests of the holders of the Warrants may only be made by “extraordinary resolution”, which will be defined in the Warrant Indenture as a resolution either (1) passed at a meeting of the registered holders of Warrants at which there are holders of Warrants present in person or represented by proxy representing at least 25% of the aggregate number of the then outstanding Warrants and passed by the affirmative vote of registered holders of Warrants representing not less than 66⅔% of the aggregate number of Warrants represented at the meeting and voted on the poll upon such resolution, or (2) adopted by an instrument in writing signed by the registered holders of not less than 66⅔% of the aggregate number of all then outstanding Warrants.

The Warrants and the Warrant Shares have not been and will not be registered under the U.S. Securities Act or any applicable state securities laws, and the Warrants will not be exercisable by or on behalf of a person in the United States or a U.S. Person, nor will certificates representing the Warrant Shares be registered or delivered to an address in the United States, unless an exemption from registration under the U.S. Securities Act and any applicable state securities laws is available and the Company has received an opinion of counsel of recognized standing or other evidence to such effect in form and substance reasonably satisfactory to the Company; provided, however, that a holder who is a “qualified institutional buyer” (as defined in Rule 144A under the U.S. Securities Act) at the time of exercise of the Warrants who purchased Offered Units in the Offering to, or for the account or benefit of, persons in the United States or U.S. Persons will not be required to deliver an opinion of counsel or such other evidence in connection with the exercise of Warrants that are a part of those Offered Units.

DIVIDEND POLICY

The Company has not, since the date of its incorporation, declared or paid any dividends or other distributions on the Common Shares, and does not currently have a policy with respect to the payment of dividends or other distributions. The Company intends to retain any future earnings to fund the development and growth of its business and does not currently pay dividends and is not likely to pay dividends for an extended period of time. The declaration and payment of any dividends in the future will be at the discretion of the Board and will depend on a number of factors, including compliance with applicable laws, financial performance, financial conditions, current and anticipated working capital requirements of the Company and the Acquired Businesses, contractual restrictions, financing agreement covenants, solvency tests imposed by applicable corporate law and such other factors as its directors consider appropriate. Pursuant to the terms of the Roynat Credit Facility, the Company is restricted from paying dividends without the prior written consent of Roynat. There can be no assurance that the Company will pay dividends under any circumstances. See “ Risk Factors – Risks Related to the Offered Units – The Company is Not Likely to Pay Dividends for an Extended Period of Time ”.

CONSOLIDATED CAPITALIZATION

As at the date of this Prospectus, the Company had 9,228,067 Common Shares issued and outstanding as well as 1,059,325 Special Warrants. On completion of the Offering (including the automatic exercise of the Special Warrants on the Automatic Exercise Date), the Company will have 13,367,392 Common Shares issued and outstanding (13,829,392 Common Shares issued and outstanding if the Over-Allotment Option is exercised in full). The Company

also has fully drawn down on the Roynat Credit Facility. There will be no material change to the Company’s loan capital that will result from the completion of the Offering.

The following table sets forth the consolidated share capitalization of the Company as at March 31, 2021 after giving effect to the completion of the Offering and the issuance of the Special Warrant Unit Shares and Special Warrant Unit Warrants upon automatic exercise of the Special Warrants, and also the issuance of the Broker Warrants upon the automatic exercise of the Broker Options. Investors should read the following information in conjunction with the Company’s unaudited consolidated financial statements as at March 31, 2021 and related notes thereto, along with the associated MD&A, included in this Prospectus.

	Authorized	Outstanding as at March 31, 2021 ($000s, except share amounts)	Outstanding as at March 31, 2021, after giving effect to the Offering, the Deemed Exercise of the Special Warrants, and the Deemed Exercise of the Broker Options ($000s, except share amounts)	Outstanding as at March 31, 2021, after giving effect to the Offering, the Over- Allotment Option, the Deemed Exercise of the Special Warrants, and the Deemed Exercise of the Broker Options ($000s, except share amounts)
Debt(1)		$10,409	$10,409	$10,409
Shareholders’ equity		$40,317	$60,337	$63,340
Total Capitalization
Common Shares(2)	Unlimited	8,766,367	13,367,392	13,829,392
Warrants(3)	1,771,000	Nil	1,540,000	1,771,000
Broker Compensation Options(4)	277,020	277,020	277,020	277,020
Finder Compensation Options(5)	62,976	62,976	62,976	62,976
Special Warrants(6)	1,059,325	1,059,325	Nil	Nil
Special Warrant Unit Warrants	529,662	Nil	529,662	529,662
Broker Options(7)	22,686	22,686	Nil	Nil
Broker Warrants(8)	22,686	Nil	22,686	22,686
Broker Warrant Unit Warrant(9)	11,343	Nil	Nil	Nil
Finder Warrants(10)	6,750	6,750	6,750	6,750
PSUs	600,000(11)(12)	600,000	600,000	600,000
Options, RSUs and _DSUs _	340,000(12)	240,000	240,000	240,000

Notes:

(1) As at March 31, 2021, the Company’s $10,409 debt consists of lease liabilities of $3,399 (which includes a current portion of $228) and $7,010 drawn down under the Roynat Credit Facility entered into on March 17, 2021.

(2) 1,059,325 Special Warrant Unit Shares are expected to be issued on the deemed exercise of the Special Warrants and included in the total number of Common Shares. This number also includes the additional 461,700 Common Shares issued effective June 22, 2021 in satisfaction of the rights issued in connection with the Subscription Receipt Financing. See “ General Development and Business of the Company – General Development of the Company – History ”.

(3) Each Warrant (one-half of one Warrant which comprises each Offered Unit) is exercisable to acquire one Warrant Share at an exercise price of $10.50 until the date that is 24 months following the Closing Date. See “ Description of Securities Being Distributed ”.

(4) Each Broker Compensation Option is exercisable to acquire one Common Share at an exercise price of $5.00 until December 30, 2022. See “ General Development and Business of the Company – General Development of the Company – History ”.

(5) Each Finder Compensation Option is exercisable to acquire one Common Share at an exercise price of $5.00 until December 30, 2022. See “ General Development and Business of the Company – General Development of the Company – History ”.

(6) 1,059,325 Special Warrants were issued on completion of the Special Warrant Financing. Each Special Warrant entitles the holder thereof to acquire one Special Warrant Unit, without payment of any additional consideration. See “ General Development and Business of the Company – General Development of the Company – History ” and “ Plan of Distribution – Special Warrants ”.
(7) 22,686 Broker Options were issued on completion of the Special Warrant Financing. Each Broker Option will be automatically exercised for one Broker Warrant on the Automatic Exercise Date. See “ General Development and Business of the Company – General Development of the Company – History ” and “ Plan of Distribution – Special Warrants ”.
(8) Each Broker Warrant entitles the holder thereof to acquire one Broker Unit at a price of $8.00, for a period of 12 months from the Automatic Exercise Date. See “ General Development and Business of the Company – General Development of the Company – History ” and “ Plan of Distribution – Special Warrants ”.
(9) Up to 11,343 Broker Unit Warrants are issuable upon the exercise of a Broker Warrant, and each Broker Unit Warrant entitles the holder thereof to acquire one additional Broker Warrant Share at a price of $10.50 for a period of 24 months from the Automatic Exercise Date.
(10) Each Finder Warrant entitles the holder thereof to acquire one Finder Warrant Share at a price of $8.00, for a period of 12 months from the Automatic Exercise Date. See “ General Development and Business of the Company – General Development of the Company – History ” and “ Plan of Distribution – Special Warrants ”.
(11) The PSUs have been issued pursuant to the PSU Plan. See “ Options to Purchase Securities – Equity Incentive Plan ”.
(12) As of the date of this Prospectus, 195,000 Options, 117,500 RSUs and 27,500 DSUs are issued and outstanding under the Equity Incentive Plan. The total number of PSUs, Options, RSUs and DSUs that can be granted pursuant to the Equity Incentive Plan is equal to 20% of the issued and outstanding Common Shares (on a non-diluted basis) calculated as of the date the Company is listed on the TSX-V. See “ Options to Purchase Securities – Equity Incentive Plan ”.

OPTIONS TO PURCHASE SECURITIES

Equity Incentive Plan

The Board adopted the Equity Incentive Plan on March 18, 2021, which provides for the grant of the following equity based compensation awards: (i) Options; (ii) RSUs and (iii) DSUs. A total of 600,000 PSUs have previously been granted under the PSU Plan on December 31, 2020. While the number of PSUs outstanding will count towards the maximum number of Common Shares reserved under the Equity Incentive Plan, no additional PSUs can be granted under the Equity Incentive Plan or the PSU Plan.

The purpose of the Equity Incentive Plan is to advance the interests of the Company by providing an incentive to the directors, officers, employees and consultants (“ Participants ”) of the Company, and any of its subsidiaries (including the Acquired Businesses) and affiliates, if any, to align growth objectives of the Company and Participants, to associate a portion of the Participants’ compensation with the Company’s long term performance and to attract to and retain in the employment of the Company or any of its subsidiaries, persons of experience and ability, by providing them with the opportunity to acquire an increased proprietary interest in the Company through the acquisition of Common Shares. A Participant under the Equity Incentive Plan or PSU Plan cannot include a person providing Investor Relations Activities to the Company.

The Equity Incentive Plan is summarized in the table below, and provided that the disclosure related to the PSUs below is derived from the PSU Plan, which does not form part of the Equity Incentive Plan.

Key Terms Administration Stock Exchange Rules Common Shares Subject to Plan	Summary
	The Equity Incentive Plan is administered by the Board or by a committee of directors designated by the Board from time to time. All previously granted PSUs, or any Options granted, RSUs awarded or DSUs awarded pursuant to the Equity Incentive Plan, are subject to applicable rules and policies of any stock exchange or exchanges on which the Common Shares are listed and any other regulatory body having jurisdiction. The number of authorized but unissued Common Shares that may be issued under the Equity Incentive Plan is 2,073,478 (or 2,165,878 if the Over-Allotment Option is exercised in full). The Common Shares reserved for issuance includes all Common Shares that may be issued upon the exercise of Options granted under the Equity Incentive Plan, distribution of DSUs and payment of vested RSUs, which is equal to 20% of the issued and outstanding Common Shares (on a non-diluted basis) calculated as of the date the Company is listed on the TSX-V in accordance

Key Terms
Administration
Stock Exchange Rules
Common Shares Subject to
Plan

Summary

The Equity Incentive Plan is administered by the Board or by a committee of
directors designated by the Board from time to time.
All previously granted PSUs, or any Options granted, RSUs awarded or DSUs
awarded pursuant to the Equity Incentive Plan, are subject to applicable rules and
policies of any stock exchange or exchanges on which the Common Shares are
listed and any other regulatory body having jurisdiction.
The number of authorized but unissued Common Shares that may be issued under
the Equity Incentive Plan is 2,073,478 (or 2,165,878 if the Over-Allotment Option
is exercised in full). The Common Shares reserved for issuance includes all
Common Shares that may be issued upon the exercise of Options granted under the
Equity Incentive Plan, distribution of DSUs and payment of vested RSUs, which is
equal to 20% of the issued and outstanding Common Shares (on a non-diluted
basis) calculated as of the date the Company is listed on the TSX-V in accordance

with the requirements of the applicable TSX-V rules, less the 600,000 PSUs previously granted under the PSU Plan.

Unless otherwise approved by the TSX-V, if applicable, and the shareholders of the Company, to the extent Options, RSUs, DSUs or PSUs expire without having been exercised or to the extent any Options, RSUs, DSUs or PSUs are terminated for any reason or are cancelled, the Common Shares subject to such Options, RSUs, DSUs or PSUs shall be added back to the number of Common Shares reserved for issuance under the Equity Incentive Plan and such Common Shares will again become available for Option grants, RSU grants and DSU grants under the Equity Incentive Plan.

Eligibility

Limits on Options, RSUs and DSUs

The persons eligible to receive equity based compensation awards under the Equity Incentive Plan are bona fide directors, officers, employees and consultants of the Company, and any of its subsidiaries and affiliates, and employees of a person or company which provides consulting, technical, managerial or like services to the Company or its subsidiaries and affiliates. The persons eligible to participate in the DSU Plan (as defined in the Equity Incentive Plan) are individuals who are, at the relevant time, a member of the Board.

The number of Options, RSUs or DSUs granted to any one person (including a company, any unincorporated entity, or an individual) and such person’s associates, within any twelve (12) month period, under all equity based compensation arrangements including, without limitation, the Equity Incentive Plan, shall not exceed 5% of the issued and outstanding Common Shares at the time of the grant unless the Company has obtained disinterested shareholder approval in respect of such grant and meets applicable regulatory requirements.

Insiders

The number of Common Shares reserved for issuance under the Equity Incentive Plan granted to insiders (as a group), at any point in time shall not exceed 10% of the issued and outstanding Common Shares, unless the Company obtains disinterested shareholder approval prior to any such action becoming effective.

The number of Options, RSUs or DSUs granted to insiders (as a group), within any twelve (12) month period, under all equity based compensation arrangements including, without limitation, the Equity Incentive Plan, shall not exceed 10% of the issued and outstanding Common Shares at the time of the grant, unless the Company obtains disinterested shareholder approval in respect of such grant.

Consultants

The aggregate number of Options or RSUs granted to any one consultant in any twelve (12) month period cannot exceed 2% of the issued and outstanding Common Shares calculated at the time of the grant, without the prior consent of the TSX-V and the shareholders of the Company.

Eligible Persons

The aggregate number of Options granted to eligible persons (as set out above) conducting Investor Relations Activities in any 12-month period cannot exceed 2%

of the issued and outstanding Common Shares, calculated at the time of grant, without the prior consent of the TSX-V and the shareholders of the Company.

Purchase of Common Shares for Cancellation

Unless otherwise approved by the TSX-V, if applicable, and the shareholders of the Company, if the acquisition of Common Shares by the Company for cancellation should result in any of the limits above no longer being met, this shall not constitute non-compliance with the Equity Incentive Plan for any Options, RSUs or DSUs outstanding prior to such purchase of Common Shares for cancellation.

Number of PSUs

The number of PSUs granted to any person (including a company, any unincorporated entity, or an individual) and such person’s associates within any twelve (12) month period, under all security-based compensation arrangements including, without limitation, the Equity Incentive Plan, shall not exceed 5% of the issued and outstanding Common Shares at the time of the grant, unless otherwise approved by the TSX-V, if applicable, and the shareholders of the Company.

The number of Common Shares reserved for issuance under the Equity Incentive Plan as it relates to PSUs granted to insiders (as a group), at any point in time shall not exceed 10% of the issued and outstanding Common Shares.

The number of PSUs granted to insiders (as a group), within any twelve (12) month period, under all security-based compensation arrangements including, without limitation, the Equity Incentive Plan, shall not exceed 10% of the issued and outstanding Common Shares at the time of the grant.

Exercise Price

Options

The exercise price of the Common Shares subject to each Option shall be determined by the Board, subject to approval by the regulators (if applicable), at the time any Option is granted, and cannot be less than the discounted market price (as defined by TSX-V Policy 1.1 – Interpretation ).

Vesting and Exercise Options Period and Payment

Each Option and all rights thereunder shall expire on the date set out in an Option grant notice, provided that in no circumstances shall the duration of an Option exceed the maximum term permitted by the applicable regulators.

RSUs

RSUs shall vest on the Trigger Date (as defined in the Equity Incentive Plan) set by the Board upon the grant of the RSU, which shall be no later than the third anniversary of the grant date. The Board may determine other terms or conditions including, vesting conditions based on performance milestones or anniversary dates provided that: (i) no RSU will vest until the Trigger Date; and (ii) no RSU will remain outstanding for any period which exceeds December 31 of the calendar year in which the Trigger Date occurs of such RSU.

RSUs that vest are payable on or subsequent to the Trigger Date, but no later than December 31 of the calendar year in which the Trigger Date of such RSU occurs, at the election of the Company as: (i) cash equal to the value of the RSU on the

Trigger Date; (ii) one Common Share for each whole RSU; or (c) a combination of cash and Common Shares.

DSUs

DSUs will be fully vested upon being granted and credited to a Participant’s account.

PSUs

PSUs shall vest on the first day immediately following the end of the applicable performance period, with the number of vested PSUs being equal to the PSU balance as at such date multiplied by a performance adjustment factor (as determined by the Board or a committee of directors designated by the Board) in accordance with the award agreement. In the event that the performance adjustment factor is equal to zero, no PSU will vest.

PSUs granted to a Participant under an award agreement and by the authority of the Board (or a committee, as applicable) shall become vested PSUs only upon the Board’s determination that the applicable performance criteria has been satisfied in accordance with the award agreement applicable to such PSUs, or that the performance criteria has been waived in accordance with the Equity Incentive Plan.

Each PSU automatically terminates 10 years from the date it is granted.

Black-Out Periods

Options

If any Options expire during the Black-out Period (as defined in the Equity Incentive Plan), the expiry date of those Options will be extended to the date which is ten business days after the expiration of the Black-out Period without any further act or formality.

RSUs

Subject to the rules of the TSX-V, notwithstanding any other provisions of the Equity Incentive Plan, if the date on which Common Shares are to be distributed in settlement of any vested RSU occurs during or within 10 business days following the end of a Black-out Period (as defined in the Equity Incentive Plan), such distribution date shall be extended for a period of 10 business days following the end of the Black-out Period (or such longer period as permitted by the TSX-V).

DSUs

If Common Shares may not be issued pursuant to any DSUs due to any Black-out Period, such issuance shall occur seven business days following the end of the Black-out Period (or such longer period as permitted by applicable regulatory authorities and approved by the Board or a committee).

Cessation of Employment Options

If a Participant ceases to be a director, officer, consultant or employee of the Company, or its subsidiaries and affiliates, or ceases to be a management company employee, for any reason (other than death), such Participant may exercise their Option to the extent that the Participant was entitled to exercise it at the date of

such cessation, provided that such exercise must occur within 30 days after the Participant ceases to be a director, officer, employee or consultant, or a management company employee, unless such Participant was engaged in Investor Relations Activities, in which case such exercise must occur within 30 days after the cessation of the Participant’s services to the Company.

RSUs

If a Participant ceases to be an employee of the Company or an affiliate of the Company during a performance period as a result of (i) termination by the Company or an affiliate of the Company for any reason, or (ii) voluntarily terminating their employment with the Company or an affiliate of the Company, including due to retirement, no portion of the RSUs subject to such performance period shall vest and the Participant shall receive no payment or other compensation in respect of such RSUs or loss thereof, on account of damages or otherwise, unless the RSUs have been designated by the Board or a committee as payable in shares.

If a Participant is terminated without just cause, or resigns based on a material reduction or material change in position, duties or remuneration within 12 months after the occurrence of a change of control event, the vesting of the RSUs will accelerate to cause a payout by means of cash, Common Shares or a combination thereof, within 10 days.

DSUs

If a Participant is no longer a member of the Board nor is otherwise employed by the Company, then within 90 days (or by such later date elected by the Participant before December 1[st] of the calendar year following the date the Participant ceases to be member of the Board or otherwise employed), the Company shall settle the DSUs by way of payment shares or cash payment.

PSUs

If a Participant ceases to be an employee of the Company or an affiliate of the Company during a performance period as a result of (i) termination by the Company or an affiliate of the Company for any reason, or (ii) voluntarily terminating her employment with the Company or an affiliate of the Company, including due to retirement, no portion of the PSUs subject to such performance period shall vest and the Participant shall receive no payment or other compensation in respect of such PSUs or loss thereof, on account of damages or otherwise, unless the PSUs have been designated by the Board or a committee as payable in shares.

Death or Disability of Options Participant

In the event of the death of a Participant, any vested Option held by a Participant at the date of death will become exercisable by the Participant’s lawful personal representative, heirs or executors until the earlier of one year after the date of death of such Participant and the date of expiration of the term otherwise applicable to such Options.

RSUs

In the event of the death or disability of a Participant, the vesting of the RSUs will accelerate to cause a payout by means of cash, Common Shares or a combination thereof, within 10 days.

DSUs

Upon the death of a Participant prior to the distribution of the DSUs credited to the account of such Participant, the DSUs will be paid by means of cash, Common Shares or a combination thereof, within 30 days of the Company being notified of the death of the Participant or on a later date elected by the Participant’s estate in the form prescribed by the Company for such purposes and delivered to the Chief Financial Officer not later than 20 days after the Company is notified of the death of the Participant, provided that such elected date is no later than one year from the Participant’s death.

PSUs

In the event of the death or disability of a Participant, the PSUs credited to the Participant’s account as at December 31 of the year immediately preceding the Participant’s date of death shall continue to be eligible to become vested PSUs in accordance with the Equity Incentive Plan. The Participant shall be entitled to receive in Common Shares, a payment relating to such vested PSUs determined in accordance with the Equity Incentive Plan.

In the event of a Participant’s period of absence during a performance period, except where such period of absence extends beyond the end of a performance period and the Participant fails to return to active full-time employment with the Company or an affiliate within one hundred and eighty (180) days following the end of such performance period, PSUs credited to the Participant’s account immediately prior to such period of absence (and any related dividend equivalent PSUs) shall continue to be eligible to become vested, except the total number of such vested PSUs shall be adjusted for the time the Participant actively performed services for the Company or an affiliate of the Company during the performance period.

Effective Date of Plan

The Equity Incentive Plan has been adopted by the Board and is effective as of March 18, 2021, and the PSU Plan has been adopted by the Board and is effective as of December 30, 2020.

Options

As at the date of this Prospectus, there are 195,000 Options issued and outstanding under the Equity Incentive Plan. The following table sets forth the aggregate number of Options which are anticipated, as at the date of this Prospectus, to be outstanding immediately prior to, and upon completion of the Offering.

Holder of Options Executive Officers Directors (other than those who are also executive officers)	Number of Optionees 4 Nil	Common Shares Underlying Options 180,000 Nil	Exercise Price $6.50(1) -	Expiry Date
				March 18, 2028 -

Holder of Options Employees Consultants TOTAL	Number of Optionees 1 6 11	Common Shares Underlying Options 2,000 13,000 195,000	Exercise Price $6.50(1) $6.50(1)	Expiry Date
				March 18, 2028 March 18, 2028

Note:

(1) The exercise price for the Options is equivalent to the Offering Price.

RSUs

As at the date of this Prospectus, there are 117,500 RSUs issued and outstanding under the Equity Incentive Plan. The following table sets forth the aggregate number of RSUs which are anticipated, as at the date of this Prospectus, to be outstanding immediately prior to, and upon completion of the Offering.

Holder of RSUs Executive Officers Directors (other than those who are also executive officers) Consultants Employees TOTAL	Number of RSUs 10,000 100,000 Nil 5,000 2,500 117,500	Common Shares Underlying RSUs 10,000 100,000 Nil 5,000 2,500 117,500	Exercise Price N/A N/A - N/A N/A	Final Vesting Date
				March 18, 2024(1) December 31, 2023(1) - March 18, 2024(1) March 18, 2024(1)

Note:

(1) 1/3 of the RSUs vest and convert into Common Shares on each grant date anniversary for three years.

DSUs

As at the date of this Prospectus, there 27,500 DSUs issued and outstanding under the Equity Incentive Plan. The following table sets forth the aggregate number of DSUs which are anticipated, as at the date of this Prospectus, to be outstanding immediately prior to, and upon completion of the Offering.

Holder of DSUs Directors TOTAL	Number of DSUs 27,500 27,500	Common Shares Underlying DSUs 27,500 27,500	Exercise Price
			N/A

PSUs

As at the date of this Prospectus, there are 600,000 PSUs issued and outstanding under the PSU Plan. Each PSU entitles the holder thereof to acquire one Common Share. Some of the PSUs granted vest upon the achievement of

consolidated annualized run rate EBITDA of the Company and the Predecessor Entities of at least $4,500,000 over any consecutive 12-month period (“ EBITDA PSUs ”), and other PSUs granted vest upon achievement of average RNG production by the Company and the Predecessor Entities of at least 500 GJ/day over any consecutive 12-month period (“ GAS PSUs ”).

The following table sets forth the aggregate number of PSUs which are anticipated, as at the date of this Prospectus, to be outstanding immediately prior to, and upon completion of, the Offering.

Holder of PSUs Executive Officers EBITDA PSUs GAS PSUs Directors (other than those who are also executive officers) EBITDA PSUs GAS PSUs Consultants ....................................................... TOTAL	Number of PSUs 130,000 260,000 70,000 140,000 Nil 600,000	Common Shares PSUs
		130,000 260,000 70,000 140,000 Nil
		600,000

PRIOR SALES

The following table summarizes the issuances of Common Shares and securities that are convertible or exchangeable into Common Shares since the incorporation of the Company to the date of this Prospectus.

Issue Date May 19, 2020 December 16, 2020 December 16, 2020 December 16, 2020 December 22, 2020 December 22, 2020 December 30, 2020 December 30, 2020 December 31, 2020 December 31, 2020	Type of Security Common Shares Common Shares Convertible Notes Common Shares Subscription Receipts Broker Compensation Options Common Shares Finder Compensation Options Common Shares Common Shares	Number Issued 3 140,000 1,260,000 1,260,000 4,617,000 277,020 1,407,976(2) 62,976 4,617,000 777,777	Issue Price $0.01 $0.001(1) N/A $0.07936 $5.00 N/A $5.00 N/A N/A $4.50	Exercise Price N/A N/A $0.07936 N/A N/A $5.00 N/A $5.00 N/A N/A	Description of Issuance
					Incorporation Private placement Loan from founders Conversion of convertible notes Private placement Issued as compensation for services in connection with the Subscription Receipt Financing(3) Private placement Issued as compensation for services(4) Conversion of Subscription Receipts(5) Issued as consideration for the NZWA

Issue Date December 31, 2020 January 12, 2021 January 26, 2021 January 26, 2021 February 23, 2021 March 18, 2021 March 18, 2021 March 18, 2021 March 18, 2021 March 18, 2021 March 18, 2021 March 18, 2021 April 16, 2021 April 27, 2021 June 22, 2021 June 29, 2021	Type of Security PSUs Common Shares Common Shares Common Shares Common Shares Special Warrants Broker Options Finder Warrants Common Shares Options RSUs DSUs Common Shares Common Shares Common Shares RSUs	Number Issued 600,000 254,000 50,000 5,000 5,000 1,059,325 22,686 6,750 13,500 195,000 17,500 27,500 125,000 111,111 461,700 100,000	Issue Price N/A $5.00 $5.00 $5.00 $5.00 $8.00 N/A N/A $8.00 N/A N/A N/A $8.00 $9.00 N/A N/A	Exercise Price N/A N/A N/A N/A N/A N/A N/A $8.00 N/A $6.50(10) N/A N/A N/A N/A N/A N/A	Description of Issuance
					Acquisition and SSS Acquisition Issued pursuant to the PSU Plan Private placement Issued as consideration for services(6) Private placement Private placement Special Warrant Financing(7) Issued as compensation for services in connection with the Special Warrant Financing(8) Issued as compensation for services in connection with the Special Warrant Financing(9) Issued as compensation for services in connection with the Special Warrant Financing(9) Issued pursuant to the Equity Incentive Plan Issued pursuant to the Equity Incentive Plan Issued pursuant to the Equity Incentive Plan Issued as consideration for the FVB Acquisition Private placement Issued in connection with the rights attached to the Underlying Shares from the Subscription Receipt Financing. Issued pursuant to the Equity Incentive Plan

Notes:

(1) 70,000 Common Shares were issued to Mary Hemmingsen and 70,000 Common Shares were issued to Sean Mezei pursuant to an application for allotment to the Company.
(2) Includes 220,000 Common Shares issued to Principals (including 80,000 Common Shares issued to Kepis & Pobe Investment Inc., a holding company of Mr. Nicholson, as consideration for debt settlement) and 41,976 Common Shares issued to the Finder in connection with the December Non-Brokered Private Placement as the Finder’s fee. See “ General Development and Business of the Company – General Development of the Company – History ”.
(3) In connection with the Subscription Receipt Financing, the Company issued 277,020 Broker Compensation Options, each exercisable to acquire one Common Share at an exercise price of $5.00 until December 30, 2022. See “ General Development and Business of the Company – General Development of the Company – History ”.
(4) In connection with the December Non-Brokered Private Placement, the Company paid certain finders a cash commission equal to $105,000, issued 41,976 Common Shares and issued 62,976 Finder Compensation Options. Each Finder Compensation Option is exercisable to acquire one Common Share at an exercise price of $5.00 until December 30, 2022. See “ General Development and Business of the Company – General Development of the Company – History ”.
(5) Upon the satisfaction of the escrow release conditions which were related to the completion of the NZWA Acquisition and SSS Acquisition (as set out in the Subscription Receipt Agreement), the Subscription Receipts issued on December 22, 2020 to each subscriber were converted into Common Shares on December 31, 2020. See “ General Development and Business of the Company – General Development of the Company – History ”.
(6) Issued to NZI (a company controlled by Mateo Ocejo, a shareholder of the Company) as the operator of the NZWA Project and SSS Project, as partial consideration upon execution of the NZI Consulting Agreement. Further issuances of shares to NZI pursuant to the NZI Consulting Agreement are to be issued at a deemed price of the maximum discounted market price permissible under the rules of the TSX-V (calculated as at the date such shares are earned).
(7) Each Special Warrant entitles the holder to receive, upon exercise or deemed exercise, one Special Warrant Unit at no additional cost. Each Special Warrant Unit is comprised of one Special Warrant Unit Share and one-half of one Special Warrant Unit Warrant. See “ Plan of Distribution – Special Warrants ” and “ Description of Securities Being Distributed – Special Warrants ”.
(8) Issued to the Special Warrant Agents in connection with the Special Warrant Financing. Each Broker Option will automatically be exchanged for one Broker Warrant on the Automatic Exercise Date. Each Broker Warrant is exercisable to acquire one Broker Unit at a price of $8.00 for a period 12 months following the Automatic Exercise Date. See “ Plan of Distribution – Special Warrants ” and “ Description of Securities Being Distributed – Broker Warrants ”.
(9) Issued to the Finder in connection with the Non-Brokered Private Placement. Each Finder Warrant is exercisable to acquire one Finder Warrant Share at a price of $8.00 for a period of 12 months following the Automatic Exercise Date. See “ Plan of Distribution – Special Warrants ”.

(10) The exercise price for the Options is equivalent to the Offering Price.

ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTION ON TRANSFER

The securities that are subject to contractual restrictions on transfer, or are expected to be subject to escrow or contractual restrictions on transfer in connection with the Offering, after giving effect to the deemed exercise of the Special Warrants, are shown in the following table:

Designation of Class Common Shares PSUs Options DSUs RSUs Special Warrant Unit Warrants	Total Number of securities held in escrow or that are subject to a contractual restriction on transfer(1) 6,616,828 (2) 600,000 180,000 27,500(4) 110,000 529,662(5)	Percentage of Class at the date of this Prospectus
		64.3%(3) 100% 92.3% 100% 93.6% 100%

Notes:

(1) 1,600,003 Common Shares, 600,000 PSUs and 14,500 DSUs will be deposited with TSX Trust Company, as escrow agent, pursuant to NP 46-201 and while the securities are under escrow, they may not be transferred or otherwise dealt with, except in very limited circumstances. (2) An aggregate of 1,620,003 Common Shares held by the directors and officers of the Company (representing 15.7% of the class) are subject to a combination of the escrow requirements, of which (i) 1,600,003 are subject to NP 46-201 escrow requirements and Offering Lock-Up Agreements (defined below) (ii) an additional 20,000 are subject to Offering Lock-Up Agreements and (iii) 1,400,003 (which are also included in (i) above) are subject to December Lock-Up Agreements. 4,946,825 Common Shares (48.1% of the class) are subject to Voluntary Lock-Up Agreements (defined below) and an additional 50,000 Common Shares are locked up pursuant to the NZI Consulting Agreement.

(3) Based on 10,287,392 issued and outstanding Common Shares, after giving effect to the deemed exercise of the Special Warrants.

(4) An aggregate of 27,500 DSUs are subject to a combination of the escrow requirements, of which (i) 14,500 are subject to NP 46-201 escrow requirements and (ii) 13,000 are subject to Voluntary Lock-Up Agreements.
(5) An aggregate of 529,662 Special Warrant Unit Warrants are subject to a combination of the escrow requirements, of which (i) 31,250 are subject to NP 46-201 escrow requirements and (ii) 498,412 are subject to Voluntary Lock-Up Agreements.

NP 46-201

Section 3.5 of NP 46-201 provides that all shares of a company owned or controlled by a Principal will be escrowed at the time of the Company’s initial listing, unless the shares held by the Principal or issuable to the Principal upon conversion of convertible securities held by the Principal collectively represent less than 1% of the total issued and outstanding shares of the Company after giving effect to the initial public offering.

At the time of its initial public offering, an issuer will be classified for the purposes of escrow as either an “exempt issuer”, an “established issuer” or an “emerging issuer”, as those terms are defined in NP 46-201.

Uniform terms of automatic timed release apply to the escrowed securities of exchange listed issuers, differing only according to the classification of the issuer. The Company anticipates that it will be classified as an “established issuer”. As such, the Company anticipates that the following automatic timed releases will apply to the escrowed securities listed in the table above:

Date of Automatic Timed Release On the date the Company’s securities are listed on a Canadian exchange 6 months after the Listing Date 12 months after the Listing Date 18 months after the Listing Date	Amount of Escrowed Securities Released
	1/4 of the escrow securities 1/3 of the remaining escrow securities 1/2 of the remaining escrow securities The remaining escrow securities

TSX-V Policy 5.4

Common Shares of the Company and securities convertible into Common Shares that are issued to non-Principals of the Company prior to completion of the Offering may be subject to escrow restrictions or hold periods imposed by TSX-V Policy 5.4 – Escrow, Vendor Consideration and Resale Restrictions (“ TSX-V Policy 5.4 ”). The purchase price of such securities and the time of their purchase relative to the date of the TSX-V granting conditional listing approval, determine which, if any, escrow restrictions or hold periods apply.

Based on the Offering Price, TSX-V Policy 5.4 will not apply to any of the Company’s securities.

Other Contractual Restrictions

- Offering Lock Up Agreements

In connection with the Offering, each of the Company’s senior officers and directors, and, as applicable, associates and affiliates, will be required to enter into lock-up agreements in favour of the Underwriters (the “ Offering LockUp Agreements ”), pursuant to which each will agree not to, directly or indirectly, offer, issue, sell, grant, secure, pledge, or otherwise transfer, dispose of or monetize, or engage in any hedging transaction, or enter into any form of agreement or arrangement the consequence of which is to alter economic exposure to, or announce any intention to do so, in any manner whatsoever, any Common Shares or securities convertible into, exchangeable for, or otherwise exercisable to acquire Common Shares or other equity securities of the Company for a period of 180 days after the Closing Date, without the prior written consent of the Co-Lead Underwriters on behalf of the Underwriters, such consent not to be unreasonably withheld, or subject to certain other limited exceptions as contained in the lock-up agreements. See “ Plan of Distribution ”.

December Lock-Up Agreements

In connection with the Subscription Receipt Financing, 1,400,003 Common Shares are subject to lock-up agreements entered into on December 22, 2020 by Mr. Edgelow, Mr. Nicholson, Ms. Hemmingsen, Mr. Zajtmann and Mr. Mezei

(the “ December Directors and Officers ”) with Clarus, Desjardins and Canaccord Genuity Corp. (the “ December Lock-Up Agreements ”). Pursuant to the December Lock-Up Agreements, until December 22, 2023, the December Directors and Officers cannot, directly or indirectly, offer, sell, transfer, pledge, hypothecate, lend, assign, grant an option or right to purchase, make any short sale, enter into any swap, forward, hedge or any other agreement or arrangement to transfer the economic consequences of or alter the economic exposure to, or otherwise dispose of, monetize or deal with, or publicly announce any intention to do any of the foregoing, whether through the facilities of a stock exchange, by private transaction or otherwise, any of their 1,400,003 Common Shares, unless permitted under the December Lock-Up Agreement.

- Special Warrant Financing Lock Up Agreements

In connection with the Special Warrant Financing, each subscriber thereto has entered into lock-up agreements in favour of the Company and each of the Special Warrant Agents (the “ Voluntary Lock-Up Agreements ”). Pursuant to the Voluntary Lock-Up Agreements, each such subscriber of Special Warrants has agreed that it will not directly or indirectly, offer, sell or transfer (i) any Common Shares held on March 18, 2021 by the subscriber or an entity directly or indirectly under the control or direction of the subscriber, or (ii) any of the Special Warrant Unit Shares or Special Warrant Unit Warrants comprising the Special Warrant Units issued on the Automatic Exercise Date or upon a voluntary exercise to the subscriber or an entity directly or indirectly under the control or direction of the subscriber, or any Special Warrant Shares subsequently acquired, for the period commencing from the Listing Date to the date that is 6 months following the Listing Date, subject to limited exceptions, without the prior written consent of the Special Warrant Agents, such consent not to be unreasonably withheld, or as permitted pursuant to the release schedule as set out below:

Release Date Listing Date 1 month after the Listing Date 2 months after the Listing Date 3 months after the Listing Date 4 months after the Listing Date 5 months after the Listing Date 6 months after the Listing Date	Percentage of Releasable Applicable Securities
	40% 10% 10% 10% 10% 10% 10%

Notwithstanding the foregoing, under the terms of the Voluntary Lock-Up Agreements, if the securities pursuant to the Voluntary Hold Periods were to be subject to “seed share resale restrictions” under TSX-V Policy 5.4, such TSXV resale restrictions were to apply and supersede the above release schedule. However, based on the Offering Price, the TSX-V resale restrictions will not apply. See “ TSX-V Policy 5.4 ” above.

Broker Securities Lock-Up Agreements

Desjardins and Clarus have also executed voluntary lock up agreements pursuant to which the broker securities issued to them in connection with the Subscription Receipt Financing, the December Non-Brokered Private Placement and the Special Warrant Financing will be locked up for a period of four (4) months following the Listing Date.

NZI Consulting Agreement

In connection with the NZI Consulting Agreement, 50,000 Common Shares are locked up until December 31, 2021.

Voluntary Hold Periods

As at the date of this Prospectus, certain securityholders as noted above have agreed to voluntary hold periods with the Company (the “ Voluntary Hold Periods ”) pursuant to the Voluntary Lock-Up Agreements. The table below sets out the securities subject to Voluntary Hold Periods.

Basis for issuance Private placement (brokered and non- brokered)	Number and Type of Securities Owned 4,946,825 Common Shares 529,662 Special Warrant Unit Warrants	Percentage of class after giving effect to the Deemed Exercise of the Special Warrants 48.1% 100.0%	Percentage of class after giving effect to the Offering and the Deemed Exercise of the Special Warrants
			37.0%(1) 100.0%

Note:

(1) Assuming the automatic exercise of the Special Warrants and no exercise of the Over-Allotment Option (if the Over-Allotment Option is exercised in full, then 4,946,825 Common Shares amounts to 35.8% of the class).

Approximately 6,616,828 Common Shares, or 64.3% of the 10,287,392 Common Shares (after giving effect to the deemed exercise of the Special Warrants and prior to completion of the Offering) will be subject to some form of escrow period or lock up period. However, pursuant to the various applicable release schedules, it is anticipated that approximately 1,978,730 Common Shares (19.2% of the Common Shares on the Closing Date) will be released and freely tradeable as of the Closing Date, resulting in approximately 4,638,098 Common Shares (45% of the Common Shares on the Closing Date prior to giving effect to the Offering) remaining subject to some form of escrow period or lock up period on the Closing Date. The foregoing assumes, in all instances that the TSX-V Policy 5.4 seed share resale restrictions will not be applicable.

PRINCIPAL SHAREHOLDERS

The following table sets forth information regarding ownership of the Common Shares, assuming the automatic exercise of the Special Warrants, as at the date of this Prospectus by each person or company who, to the Company’s knowledge, beneficially owns, or controls or directs, directly or indirectly, Common Shares carrying 10% or more of the voting rights attaching to all issued and outstanding Common Shares.

Name Reddick Wellington(1)	After giving effect to the Deemed Exercise of the Special Warrants Number and Type of Securities Owned Percentage of Outstanding Common Shares Type of Ownership Common Shares to be Sold Pursuant to the Offering 1,162,500 Common Shares 11.3% Beneficial(2) Nil 31,250 Special Warrant Unit Warrants N/A Beneficial(2) N/A	After giving effect to the Deemed Exercise of the Special Warrants Number and Type of Securities Owned Percentage of Outstanding Common Shares Type of Ownership Common Shares to be Sold Pursuant to the Offering 1,162,500 Common Shares 11.3% Beneficial(2) Nil 31,250 Special Warrant Unit Warrants N/A Beneficial(2) N/A	After giving effect to the Deemed Exercise of the Special Warrants Number and Type of Securities Owned Percentage of Outstanding Common Shares Type of Ownership Common Shares to be Sold Pursuant to the Offering 1,162,500 Common Shares 11.3% Beneficial(2) Nil 31,250 Special Warrant Unit Warrants N/A Beneficial(2) N/A	Following the Offering and the Deemed Exercise of the Special Warrants	Following the Offering and the Deemed Exercise of the Special Warrants
	Number and Type of Securities Owned 1,162,500 Common Shares 31,250 Special Warrant Unit Warrants	Percentage of Outstanding Common Shares 11.3% N/A	Type of Ownership Beneficial(2) Beneficial(2)	Percentage of Outstanding Common Shares(3) 8.7% 0.2%	Percentage of Outstanding Common Shares on a Fully Diluted Basis(4)
					6.9% 0.2%

Notes:

(1) Djenane Cameron, a director of the Company, is the Chief Investment Officer of Reddick Wellington .

(2) Registered in the name of CDS & Co. National Bank Financial Inc. as a CDS participant holds the Common Shares and the Specials Warrants in trust for Reddick Wellington.

(3) Based on 13,367,392 outstanding Common Shares on a non-diluted basis following the completion of the Offering (assuming no exercise of the Over-Allotment Option) and the completion of the issuance of the Special Warrant Unit Shares.

(4) Based on 16,757,829 outstanding Common Shares on a fully diluted basis following the completion of the Offering (assuming no exercise of the Over-Allotment Option), after giving effect to the exercise of 1,540,000 Warrants, 277,020 Broker Compensation Options, exercise of 62,976 Finder Compensation Options, conversion of 600,000 PSUs, exercise of 195,000 Options, conversion of 27,500 DSUs, conversion of 117,500 RSUs, the issuance of 1,059,325 Special Warrant Unit Shares, exercise of 529,662 Special Warrant Unit Warrants, exercise of 22,686 Broker Warrants for an equivalent number of Broker Unit Shares and 11,343 Broker Unit Warrants that exercise into an equivalent number of Broker Warrant Shares, and the exercise of 6,750 Finder Warrants.

DIRECTORS AND EXECUTIVE OFFICERS

To the Company’s knowledge as at the date of this Prospectus, its directors and executive officers as a group (excluding the purchase of any Offered Units by any directors and executive officers under the Offering) will beneficially own, or control or direct, directly or indirectly, 1,620,003 Common Shares, representing approximately 15.7% of the outstanding Common Shares on a non-diluted basis after giving effect to the deemed exercise of the Special Warrants (12.1% following completion of the Offering (assuming no exercise of the Over-Allotment Option)).

Director and Executive Officer Profiles

The following table sets forth the name of each director and executive officer of the Company as at the date of this Prospectus, their province or state and country of residence, their position(s) and office(s) held with the Company, their principal occupation(s) during the preceding five years, the date they became a director of the Company, if applicable, and the number and percentage of Common Shares they beneficially own, or control or direct, directly or indirectly. Each director’s term will expire immediately prior to the first annual meeting of shareholders of the Company.

Name and Residence Chase Edgelow(4) British Columbia, Canada Ford Nicholson(1)(3)(5) British Columbia, Canada Mary Hemmingsen(1)(3)(4) British Columbia, Canada	Position CEO & Director Director Director	Principal Occupation(s) During Past Five Years Strategy Advisor of Satisfai Health, Inc. since February 2020; and formerly Associate Director, Macquarie Group from 2009 to 2019. President of Kepis & Pobe Financial Group Inc. since February 2003; director of Satisfai Health, Inc. since 2000; formerly Chairman of Kolibri Global Energy Inc. (formerly, BNK Petroleum Inc.) until December 2020 (a Toronto Stock Exchange listed company); and formerly Deputy Chairman of InterOil Corporation (a previously NYSE listed company) from June 2014 to February 2017. Board Trustee of Graham Construction since October 2020; director of a number of privately held companies, including InstarAGF Asset Management Inc. (since October 2017) and The Crossing Group (since May 2020); and formerly director and audit committee member of two previously Toronto Stock Exchange listed companies, including Stuart Olson Inc. (from November 2018 to October 2020) until it was sold to another listed company and Bonavista Energy Corporation (from August 2019 to July 2020) until it was taken private.	Director Since May 13, 2020 May 13, 2020 December 16, 2020	Number and Percentage of Common Shares Held(10)
				450,001(5) 4.4% 500,001(6) 4.9% 80,000 0.8%

Name and Residence Djenane Cameron(1)(3)(5)(7) Ontario, Canada Jon Ozturgut(4)(5) Washington, United States Mischa Zajtmann British Columbia, Canada Jennifer Schilling British Columbia, Canada Sean Mezei British Columbia, Canada	Position Director Director President & Corporate Secretary CFO COO	Principal Occupation(s) During Past Five Years Chief Investment Officer at Reddick Wellington Investments Inc. since October 2019; and formerly Head of Mergers and Acquisitions at Lynx Equity Limited from January 2009 to September 2019. Managing Principal at ONS Superior Energy Outcomes since 2016; and formerly Chief Operating Officer and Chief Commercial Officer at InterOil Corporation (a previously NYSE listed company) from 2012 to May 2016. Partner at Kepis & Pobe Financial Group Inc. since January 2018; director of Earl Resources Ltd. since January 2021; formerly General Counsel at Red Eagle Mining Corporation from June 2016 to December 2017; and formerly General Counsel at Oxygen Capital Corp. from March 2014 to June 2016. Formerly, President, CFO and COO of Fresh Tracks Canada from March 2018 to November 2020; and formerly director of Organisational Effectiveness Consulting from June 2016 to December 2017. Principal at Dekany Consulting Inc. since February 2014.	Director Since January 21, 2021 March 18, 2021 N/A(9) N/A N/A	Number and Percentage of Common Shares Held(10)
				20,000(8) 0.2% Nil 450,001 4.4% Nil 120,000 1.2%

Notes:

(1) Member of the Audit Committee.

(2) Member of the Human Resources and Compensation Committee.

(3) Corporate Governance and Nomination Committee.

(4) Member of the Safety and Sustainability Committee.

(5) Includes 30,000 Common Shares owned by Mr. Edgelow’s spouse, Stephanie Merkel, and 420,001 Common Shares owned directly by Mr. Edgelow.

(6) Includes 500,000 Common Shares owned by Kepis & Pobe Investments Inc., a company controlled by Mr. Nicholson, and 1 Common Share owned directly by Mr. Nicholson.

(7) Ms. Cameron was nominated by Reddick Wellington, pursuant to a side letter agreement dated December 22, 2020 between Reddick Wellington and the Company, whereby Reddick Wellington has a right to, among other things, nominate one member of the Board to be included in each slate of directors to be presented to the shareholders of the Company at each annual general meeting where directors are to be elected, for so long as Reddick Wellington holds at least 5% of the issued and outstanding Common Shares of the Company.

(8) Common Shares owned by Djumbo Investments Corp., a company controlled by Ms. Cameron.

(9) Mr. Zajtmann served as a Board member from May 13, 2020 to March 18, 2021, when Mr. Zajtmann resigned as a director of the Company. (10) Based on 10,287,392 Common Shares after giving effect to the deemed exercise of the Special Warrants.

Executive Officer and Director Biographies

Chase Edgelow , Chief Executive Officer and Director

Mr. Edgelow has 15 years of specialized private investment, finance and technical expertise in the energy and infrastructure sectors. He spent over 11 years at Macquarie Group Limited, responsible for sourcing and evaluating projects and investment opportunities, managing due diligence, transaction execution and principal holdings on behalf of Macquarie Group Limited and alongside co-investment partners. He led Macquarie Group Limited and Business Partners L.P.’s highly successful ~US$2.1 billion acquisition of Western Australia energy & infrastructure assets (Quadrant Energy), which both parties sold in 2018. Mr. Edgelow is a CFA and a Professional Engineer of Alberta.

Ford Nicholson, Director

Mr. Nicholson is the President, Chief Executive Officer and founder of Kepis & Pobe Financial Group Inc. Over the past 25 years Mr. Nicholson has invested in and provided executive management to multiple international projects. He currently serves on the Board of EverGen Infrastructure Corp. and Satisfai Health Inc. Mr. Nicholson is the former deputy chairman of the board of InterOil Corporation, a fully integrated company developing LNG for Asian markets formerly listed on the NYSE before its sale to Exxon Mobil Corporation. Mr. Nicholson is also the former chairman of the board of Kolibri Global Energy Inc. (formerly BNK Petroleum Inc.), an international energy company listed on the Toronto Stock Exchange. He was a co-founder and Director of Nations Energy Ltd. in Kazakhstan and a cofounder and former board member of Bankers Petroleum Ltd. in Albania. Mr. Nicholson is also a former member of the President’s council of the International Crisis Group. Mr. Nicholson has a Diploma in Finance from the British Columbia Institute of Technology.

Mary Hemmingsen, Director

Ms. Hemmingsen has over 30 years of energy, infrastructure and cleantech experience in business development and related portfolio management and project development across many aspects of both the North American and global energy sector. She has served on a number of publicly listed and continues to serve on private company boards in the energy, energy services and infrastructure sector, including InstarAGF Asset Management Inc., Graham Construction and The Crossing Group. Her previous executive roles include: Executive Vice President and Chief Financial Officer of North West Innovation Works, a cleantech gas to methanol development platform; Partner and Industry Lead of Power and Utilities for Canada as well as global Head of Gas and LNG at KPMG LLP; Senior Vice-President of Business Development for Brookfield Power and Utilities and a member of senior roles at BC Hydro and Power Authority. Both of the latter roles at Brookfield Power and Utilities and BC Hydro and Power Authority included responsibilities associated with renewable project development and asset management. Ms. Hemmingsen is a Chartered Professional Accountant (British Columbia) with a Bachelor of Business Administration degree from Simon Fraser University, and has completed the Harvard Business School General Management Program and the Institute of Certified Directors Program.

Djenane Cameron, Director

Ms. Cameron has over 20 years of experience in investment management. Ms. Cameron is currently the Chief Investment Officer of Reddick Wellington, and her role includes oversight and guiding investment decisions across a large, diverse portfolio comprised of real estate, private debt, public market equities and private equity. Prior to joining Reddick Wellington, Ms. Cameron held a number of positions in asset management and private equity including: Head of M&A at Lynx Equity Limited; Managing Director of JovFunds Inc; Vice President of EdgeStone Capital Partners; and Manager of Working Ventures Labour Sponsored Fund. She currently sits on the board of Credit and Investments of Peakhill Capital, a commercial mortgage and mezzanine debt lender. Ms. Cameron holds a Master of Business Administration from Ivey Business School at Western University and a Bachelor of Arts degree from McGill University.

Jon Ozturgut, Director

Mr. Ozturgut is a senior energy executive who brings extensive experience in multi-billion dollar investments in exploration, development, and production across global markets in the Americas, Middle East, Africa, Australia, and Asia. Mr. Ozturgut was the Chief Commercial Officer of InterOil Corporation, prior to its acquisition by Exxon Mobil Corporation for US$2.9 billion, where he also oversaw the monetization of over US$1 billion of downstream and upstream assets. Prior to joining InterOil Corporation, Mr. Ozturgut was Senior Vice President at Woodside Petroleum, the largest independent Australian oil and gas company, overseeing international corporate strategy, growing the exploration portfolio, mergers and acquisitions projects, and liquefied natural gas (LNG) developments. He has also held a range of executive positions in operations, delivering significant projects and company transforming transactions during his tenure with Pioneer Natural Resources, CMS Oil and Gas Company, and in his 15 years with Atlantic Richfield Company (ARCO). Mr. Ozturgut has a degree in Mechanical Engineering from the University of Washington.

Mischa Zajtmann, President and Corporate Secretary

Mr. Zajtmann has over 15 years of professional experience in the natural resources and energy space. He is a Partner at Kepis & Pobe Financial Group Inc., a Canadian based energy platform focused on the renewable energy sector. He has held executive positions for both Canadian and U.S.-listed companies in the resource sector with projects in South America, Africa and Asia. He began his career as a lawyer at Blake, Cassels & Graydon LLP where his practice focused primarily on securities, mergers & acquisition and corporate law. Mr. Zajtmann holds a LLB from the University of Saskatchewan and a Bachelor of Arts degree from the University of British Columbia.

Jennifer Schilling, Chief Financial Officer

Ms. Schilling has over 17 years of professional experience in Financial and Professional Services. She served as President and Chief Financial Officer of Fresh Tracks Canada, a Canadian-based luxury travel company between 2018 and 2020. She has delivered strategic finance projects as a consultant in the UK and across Asia-Pacific in her roles as a consultant including with KPMG Services Pte. Ltd. (Singapore) and with two global retail banks, Standard Chartered Bank and Barclays Bank Plc (U.K.). Jennifer gained her Chartered Accountancy accreditation with Deloitte LLP (U.K.) and is a Chartered Professional Accountant (British Columbia) and a Fellow of Chartered Accountants (U.K.). She has a Bachelor of Arts degree from the University of Newcastle-upon-Tyne.

Sean Mezei, Chief Operating Officer

Mr. Mezei has over 20 years of experience in the RNG industry with previous positions as President of Greenlane Biogas and as a Senior Manager at QuestAir. He has been involved in developing and executing over 60 RNG projects in North America, Europe and Asia. Additionally, he was involved in many national and regional RNG road mapping and specification setting committees in North America and was co-chairman of the American Biogas Council’s RNG Working Group for six years. Mr. Mezei holds a Bachelor’s degree in Chemical Engineering from the University of British Columbia and a Master of Business Administration from Simon Fraser University. He has been a Registered Professional Engineer in the Province of British Columbia since 1994.

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

None of the Company’s directors or executive officers is, as at the date hereof, or was within 10 years before the date hereof, a director, chief executive officer or chief financial officer of any company (including the Company) that (i) was subject to a cease trade order, an order similar to a cease trade order or an order that denied the relevant issuer access to any exemption under securities legislation, that was in effect for a period or more than 30 consecutive days (an “ Order ”) that was issued while the director or executive officer was acting in the capacity as director, chief executive officer or chief financial officer of such issuer, or (ii) was subject to an Order that was issued after the director or executive officer ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer.

None of the Company’s directors or executive officers, nor, to its knowledge, any shareholder holding a sufficient number of its securities to affect materially the control of the Company (i) is, as at the date hereof, or has been within the 10 years before the date hereof, a director or executive officer of any company (including the Company) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets, or (ii) has, within the 10 years before the date hereof, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of such director, executive officer or shareholder.

None of the Company’s directors or executive officers, nor, to its knowledge, any shareholder holding a sufficient number of its securities to affect materially the control of the Company, has been subject to (i) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority, or (ii) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable investor in making an investment decision.

Conflicts of Interest

To the best of the Company’s knowledge, there are no existing or potential material conflicts of interest between the Company and any of its directors or officers as of the date hereof. However, certain of the Company’s directors and officers are, or may become, directors or officers of other companies with businesses which may conflict with its business. Accordingly, conflicts of interest may arise which could influence these individuals in evaluating possible acquisitions or in generally acting on the Company’s behalf. See “ Risk Factors – Risks Related to the Company – The Directors and Officers May Have Conflicts of Interest with the Company ”.

Pursuant to the BCBCA, directors and officers of the Company are required to act honestly and in good faith with a view to the best interests of the Company. As required under the BCBCA:

a director or senior officer who holds any office or possesses any property, right or interest that could result, directly or indirectly, in the creation of a duty or interest that materially conflicts with that individual’s duty or interest as a director or senior officer of the Company, must promptly disclose the nature and extent of that conflict; and
a director who holds a disclosable interest (as such term is defined under the BCBCA) in a contract or transaction into which the Company has entered or proposes to enter may generally not vote on any directors’ resolution to approve such contract or transaction.

Generally, as a matter of practice, directors who have disclosed a material interest in any contract or transaction that the Board is considering will not take part in any Board discussion respecting that contract or transaction. If on occasion such directors do participate in the discussions, they will refrain from voting on any matters relating to matters in which they have disclosed a material interest. In appropriate cases, the Company will establish a special committee of independent directors to review a matter in which directors or officers may have a conflict.

See “ Statement on Corporate Governance – Ethical Business Conduct ” for the steps taken by the Company in monitoring compliance with the Code. See also “ Risk Factors – Risks Related to the Company – The Directors and Officers May Have Conflicts of Interest with the Company ”.

Directors’ and Officers’ Liability Insurance and Indemnification

The Articles provide for the indemnification of each director and officer against all costs, charges and expenses reasonably incurred by him or her in respect of any action or proceeding to which he or she is made a party by reason of being a director or officer of the Company, subject to the limitations contained in the Articles and in the BCBCA.

On February 16, 2021, the Company obtained directors’ and officers’ liability insurance policies for the period to February 16, 2022 with coverage in the amount of up to $5 million per year.

DIRECTOR AND EXECUTIVE COMPENSATION

The following section describes the significant elements of the Company’s executive and director compensation programs, with particular emphasis on the compensation payable to the President, Chief Executive Officer and Chief Financial Officer, and other officers that were determined to be “Named Executive Officers” or “NEOs” within the meaning of NI 51-102.

Compensation Governance

Responsibilities of the Human Resources and Compensation Committee

The Board has established the Human Resources and Compensation Committee to assist it in fulfilling its responsibilities pertaining to human resources and compensation matters. The Human Resources and Compensation Committee is responsible for determining the overall compensation strategy of the Company and administering the Company’s executive compensation program. As part of its mandate, the Human Resources and Compensation Committee reviews and recommends to the Board for approval remuneration of the Company’s executive officers, including the Company’s Named Executive Officers identified in the Summary Compensation Table below. The Human Resources and Compensation Committee is also responsible for reviewing the Company’s compensation policies and guidelines generally.

The Human Resources and Compensation Committee is comprised of Ford Nicholson (chair), Djenane Cameron and Jon Ozturgut, two of whom are independent directors within the meaning of NI 52-110. Each of the members of the Human Resources and Compensation Committee has business and other experience which is relevant to their work on the Human Resources and Compensation Committee. By virtue of their differing professional backgrounds, business experience, knowledge of the Company’s industry, knowledge of corporate governance practices and, where appropriate, service on the compensation committees of other reporting issuers and experience interacting with external consultants and advisors, the members of the Human Resources and Compensation Committee are able to make decisions on the suitability of the Company’s compensation policies and practices.

Executive Compensation-Related Fees

From the date of incorporation of the Company until the financial year ended December 31, 2020, no fees were billed to the Company by any consultant or advisor, or any of its affiliates, for services related to determining compensation for any of the Company’s directors and executive officers or for any other services.

Executive Compensation Discussion and Analysis

Compensation Philosophy

It is the objective of the Company’s executive compensation program to attract and retain highly qualified executives and to link incentive compensation to performance and shareholder value, while at the same time keeping in mind that the Company currently has limited financial resources. The Human Resources and Compensation Committee endeavours to ensure that the compensation of executive officers is both motivational and sufficiently competitive to achieve the objectives of the executive compensation program. The Human Resources and Compensation Committee gives consideration to the Company’s long-term interests and quantitative financial objectives, as well to the qualitative aspects of the individual’s performance and achievements.

In fulfilling its responsibilities, the Human Resources and Compensation Committee will establish and review peer groups of comparable companies and target competitive positioning for the Company’s compensation programs. Together with this comparative information, the Human Resources and Compensation Committee will lead the annual Chief Executive Officer and President review and evaluation process, and will recommend to the Board the compensation for the Chief Executive Officer and President for approval. The Chief Executive Officer and President

annually assess the individual performance and development of each executive officer, and the Human Resources and Compensation Committee, in consultation with the Chief Executive Officer and President, reviews these assessments and fixes the compensation of each individual for recommendation to the Board for approval.

The Human Resources and Compensation Committee does not set specific performance objectives in assessing the performance of the Chief Executive Officer and other executive officers; rather the Human Resources and Compensation Committee uses its experience and judgment in determining an overall compensation package for the Chief Executive Officer, President and other executive officers. The Human Resources and Compensation Committee will assess the performance of the Company and its executive officers relative to the Company’s goals and objective and in relation to the performance of the Company’s industry peer group.

Elements of Executive Compensation

The Company’s executive compensation is comprised of three principal components: base salaries, the Equity Incentive Plan, and incentive bonus compensation which are designed to provide compensation to effectively retain and motivate the executive officers to achieve the corporate goals and objectives. Other components of executive compensation include perquisites and other personal benefits. Each component of the executive compensation program is addressed separately below. The fixed element of compensation provides a competitive base of secure compensation required to attract and retain executive talent. The variable performance based compensation is designed to encourage both short-term and long-term performance of the Company.

Base Salaries

The base salary component is intended to provide a fixed level of competitive pay that reflects each executive officer’s primary duties and responsibilities and the level of skills and experience required to successfully perform his or her role. The Company intends to pay base salaries to its executive officers, including the Chief Executive Officer and President, that are competitive with those for similar positions within the Company’s selected peer group. Salaries for executive officers are reviewed annually based on corporate and personal performance and on individual levels of responsibility. Salaries of the executive officers are not determined based on benchmarks or a specific formula. The Human Resources and Compensation Committee determines the salary of the Chief Executive Officer and President. The Human Resources and Compensation Committee considers, and, in consultation with the Chief Executive Officer and President, fixes the compensation for the other executive officers of the Company for recommendation to the Board for approval.

Incentive Bonus Compensation

In addition to base salaries, the Company can award discretionary bonuses to executive officers. The bonus element of the Company’s executive compensation program is designed to retain top quality talent and reward both corporate and individual performance during the Company’s last completed financial year. To determine bonus awards for executive officers, including the Named Executive Officers, the Human Resources and Compensation Committee will consider both the executive’s personal performance and the performance of the Company relative to its peers. Named Executive Officers are eligible for discretionary bonus compensation payable should the Company reach certain performance milestones, such as a certain revenue and/or net-income targets. The proposed bonus amounts and targets for executive officers are reviewed by the Human Resources and Compensation Committee in consultation with the Chief Executive Officer and President, and recommended to the Board for approval.

Equity Incentive Plan

The Board has adopted the Equity Incentive Plan to provide an incentive to the directors, officers, employees, consultants of the Company or any of its subsidiaries and affiliates, if any, to achieve the long-term objectives of the Company; to give suitable recognition to the ability and industry of such persons who contribute materially to the success of the Company; and to attract and retain persons of experience and ability, by providing them with the opportunity to acquire an increased proprietary interest in the Company through the acquisition of Common Shares. See “ Options to Purchase Securities – Equity Incentive Plan ” for a summary of the Equity Incentive Plan.

The Equity Incentive Plan is a tool the Company can use to secure the best possible talent to run the Company. Options or other equity based compensation may be awarded in lieu of higher salaries. The grant of Options or other equity based compensation are designed to give each option holder or award holder an interest in preserving and maximizing shareholder value in the longer term and to reward employees for both past and future performance. Individual grants or awards are determined by an assessment of an individual’s current and expected future performance, level of responsibilities and the importance of his or her position with and contribution to the Company. In addition, the Equity Incentive Plan enables executives to develop and maintain a significant ownership position in the Company. This results in a significant portion of executive compensation being “at risk” and directly linked to the achievement of business results and long-term value creation.

Options or other equity based compensation awards are normally recommended by management and approved by the Board upon the commencement of an individual’s employment with the Company based on the level of their respective responsibility within the Company. Additional grants or awards may be made periodically, generally on an annual basis, to ensure that the number of Options or other equity based compensation awards granted to any particular individual is commensurate with the individual’s level of ongoing responsibility within the Company. In considering additional grants or awards, a number of factors are considered including the number of Options or other equity based compensation awards held by such individual, the exercise price and implied value of the Options or other equity based compensation awards, the term remaining on those Options and the total number of Options together with other equity based compensation awards the Company has available for grant or award under the Equity Incentive Plan.

Perquisites and Other Components

Other components of compensation include perquisites and personal benefits as determined by the Human Resources and Compensation Committee that are consistent with the overall compensation strategy. There is no formula for how perquisites or personal benefits are utilized in the total compensation package.

The Company does not provide any pension or retirement benefits to its executive officers.

Compensation Benchmarking

To date, salaries of the executive officers are not determined based on benchmarks or a specific formula. Salaries are informed to ensure the Company is competitive with those for similar positions within the Company’s selected peer group.

Managing Compensation Risk

The oversight and administration of the Company’s compensation program requires the Human Resources and Compensation Committee to consider risks associated with the Company’s compensation policies and practices. Potential risks associated with compensation policies and compensation awards are considered at annual meetings of the Human Resources and Compensation Committee at which compensation related recommendations to the Board are formulated.

The Company’s executive compensation policies and practices are intended to align management incentives with the long-term interests of the Company and its shareholders. In each case, the Company seeks an appropriate balance of risk and reward. Practices that are designed to avoid inappropriate or excessive risks include (i) the Company’s operating strategy and related compensation philosophy, (ii) the effective balance, in each case, between cash and equity mix, near-term and long-term focus, corporate and individual performance, and financial and non-financial performance; and (iii) a multi-faceted approach to performance evaluation and compensation that does not reward an executive for engaging in risky behavior to achieve one objective to the detriment of other objectives.

Based on this review, the Human Resources and Compensation Committee believes that the Company’s total compensation program does not encourage executive officers to take unnecessary or excessive risk.

The Company does not prohibit the Named Executive Officers or the directors from purchasing financial instruments, including, for greater certainty, prepaid variable forward contracts, equity swaps, collars, or units of exchange funds, that are designed to hedge or offset a decrease in market value of equity securities granted as compensation or held, directly or indirectly, by such person. The Named Executive Officers and directors have advised the Company that

they have not entered into any such arrangements. To the extent that they subsequently enter into an agreement, arrangement or understanding that has the effect of altering, directly or indirectly, their economic exposure to the Company, insider reporting laws in Canada provide that they must file a report disclosing the existence and material terms of the agreement, arrangement or understanding within five days of the event.

Share-based and Option-based Awards

For information on share-based and option-based awards, please see “ Options to Purchase Securities – Equity Incentive Plan ”.

Summary Compensation Table

The following table contains information about the compensation (excluding stock options and other compensation securities) to, or earned by, individuals who were, as at the financial year ended December 31, 2020, “Named Executive Officers” or “NEOs” within the meaning of NI 51-102. No compensation was awarded to, earned by, paid to, or payable to the Company’s officers during the financial year ended December 31, 2019, as the Company was formed during 2020. The NEOs of the Company as at December 31, 2020, were Chase Edgelow, Chief Executive Officer of the Company; Mischa Zajtmann, President and Corporate Secretary of the Company; and Sean Mezei, Chief Operating Officer of the Company. Jennifer Schilling, Chief Financial Officer was not hired until March 15, 2021 and is therefore not included in the table below.

Name and				Committee
Principal				or Meeting	Value of	Value of All Other
Position	Year	Salary	Bonus	Fees	Perquisites	Compensation(1)	Total Compensation
Chase Edgelow Chief Executive Officer and Director	2020	Nil(1)	Nil	Nil	Nil	Nil	Nil
Mischa Zajtmann President and Corporate Secretary	2020	Nil(1)	Nil	Nil	Nil	Nil	Nil
Sean Mezei Chief Operating Officer	2020	Nil(1)	Nil	Nil	Nil	Nil	Nil

Notes:

(1) None of the NEOs received any salary for the period of May 13, 2020 to December 31, 2020. Pursuant to an Employment Agreement dated January 1, 2021 between the Company and each of Mr. Edgelow, Mr. Zajtmann, and Mr. Mezei, they will receive a base salary of $225,000, $200,000, and $200,000, respectively.

Stock Options and Other Compensation Securities

The following table discloses all compensation securities granted or issued to each NEO or director by the Company or its subsidiaries as at the date of this Prospectus for services provided, directly or indirectly to the Company or any of its subsidiaries:

Name and Position	Type of Compensation Security	Number of Compensation Securities, Number of Underlying Securities, and Percentage of Class(1)	Date of Issue or Grant	Issue, Conversion or Exercise Price	Expiry Date
Chase Edgelow Chief Executive Officer and Director	Options PSUs	45,000 Options/45,000 Common Shares/23.08%(2) 140,000 PSUs/140,000 Common Shares/23.33%(3)	March 18, 2021 December 30, 2020	$6.50(7) $5.00	March 18, 2028 December 30, 2030
Mischa Zajtmann President and Corporate Secretary	Options PSUs	45,000 Options/45,000 Common Shares/23.08%(2) 80,000 PSUs/80,000 Common Shares/13.33%(3)	March 18, 2021 December 30, 2020	$6.50(7) $5.00	March 18, 2028 December 30, 2030
Jennifer Schilling(4) Chief Financial Officer	Options RSUs	45,000 Options/45,000 Common Shares/23.08%(2) 10,000 RSUs/10,000 Common Shares/8.5%(5)	March 18, 2021 March 18, 2021	$6.50(7) Nil	March 18, 2028 March 18, 2024(8)
Sean Mezei Chief Operating Officer	Options PSUs	45,000 Options/45,000 Common Shares/23.08%(2) 170,000 PSUs/170,000 Common Shares/28.33%(3) 100,000 RSUs/100,000 Common Shares/85.1%(5)	March 18, 2021 December 30, 2020 June 29, 2021	$6.50(7) $5.00 Nil	March 18, 2028 December 30, 2030 December 31, 2023
Ford Nicholson Director	DSUs PSUs	6,500 DSUs/6,500 Common Shares/23.64%(6) 80,000 PSUs/80,000 Common Shares/13.33%(3)	March 18, 2021 December 30, 2020	Nil $5.00	Nil December 30, 2030
Djenane Cameron Director	DSUs	6,500 DSUs/6,500 Common Shares/23.64%(6)	March 18, 2021	Nil	Nil
Mary Hemmingsen Director	DSUs PSUs	8,000 DSUs/8,000 Common Shares/29.09%(6) 130,000 PSUs/130,000 Common Shares/21.66%(3)	March 18, 2021 December 30, 2020	Nil $5.00	Nil December 30, 2030
Jon Ozturgut Director	DSUs	6,500 DSUs/6,500 Common Shares/23.64%(6)	March 18, 2021	Nil	Nil

Notes:

(1) Based on 10,287,392 Common Shares after giving effect to the deemed exercise of the Special Warrants.

(2) Based on 195,000 Options issued and outstanding pursuant to the Equity Incentive Plan as of the date of this Prospectus.

(3) Based on the total 600,000 PSUs issued and outstanding pursuant to the PSU Plan at an estimated value of $5.00/PSU as of the date of this Prospectus. See “ Options to Purchase Securities – Equity Incentive Plan ”.

(4) Jennifer Schilling was not hired as Chief Financial Officer until March 15, 2021.

(5) Based on 117,500 RSUs granted pursuant to the Equity Incentive Plan as of the date of this Prospectus. RSUs are convertible into Common Shares, cash payment or a combination of Common Shares and a cash payment, issued pursuant to the Equity Incentive Plan. See “ Options to Purchase Securities – Equity Incentive Plan ”.
(6) Based on 27,500 DSUs granted pursuant to the Equity Incentive Plan as of the date of this Prospectus. DSUs are convertible into treasury Common Shares or, upon the joint election of the Company and the Participant, a cash payment or a combination thereof. See “ Options to Purchase Securities – Equity Incentive Plan ”.
(7) The exercise price for the Options is equivalent to the Offering Price.
(8) 1/3 of the RSUs vest and convert into Common Shares on each grant date anniversary for three years, with the last vesting date occurring on March 18, 2024.

Exercise of Compensation Securities by Directors and NEOs

There have been no securities exercised by directors of the Company or NEOs for the year to the date of the filing of this Prospectus.

Termination and Change of Control Benefits

The Company has entered into an employment agreement with each of Chase Edgelow (Chief Executive Officer), Mischa Zajtmann (President and Corporate Secretary), Jennifer Schilling (Chief Financial Officer) and Sean Mezei (Chief Operating Officer) (each an “ Employment Agreement ”). Each Employment Agreement includes termination provisions, including upon a “change of control”. The significant terms of each Employment Agreement are described below.

For the purpose of the summaries below, the following terms have the following meanings: (i) “ change of control ” means: (a) the sale by the Company of all of the assets of the Company or substantially all of the assets of the Company; (b) the acquisition by any person (whether from the Company or from any other person) of Common Shares or other securities of the Company having rights of purchase, conversion or exchange into Common Shares which together with securities of the Company held by such person, together with persons acting jointly or in concert with such person, exceeds 51% of the issued and outstanding Common Shares (on a non-diluted basis) (assuming the purchase, conversion or exchange of such other securities, whether then purchasable, convertible or exchangeable or not, into the highest number of Common Shares, such person or persons would be entitled to); (c) the amalgamation or merger or other business combination of the Company with or into any one or more other corporations (other than: (i) an amalgamation or merger or other business combination of the Company with or into a subsidiary of the Company; or (ii) an amalgamation or merger or other business combination of the Company unanimously recommended by the Board provided that the former holders of Common Shares receive, in the aggregate and in their capacities as such, shares of the amalgamated or merged Company having attached thereto not less than 51% of the votes attached to all shares of such amalgamated or merged Company); (d) the election at a meeting of the Company’s shareholders of that number of persons which would represent a majority of the Board as directors of the Company, who are not included in the slate for election as directors proposed to the Company’s shareholders by management of the Company; (e) a liquidation, dissolution or winding up of the Company; (f) the completion of any transaction, including, without limitation, a plan of arrangement, or the first of a series of transactions which would have the same or similar effect as any transaction or series of transactions referred to in subsections (a), (b), (c), (d) or (e) of this definition; or (g) a determination by the Board that there has been a change, whether by way of a change in the holding of the Common Shares, in the ownership of the Company’s assets or by any other means, as a result of which any Person or group of persons acting jointly or in concert is in a position to exercise effective control of the Company; and (ii) “ good reason ” means, unless consented to in writing by the executive, any action which at common law constitutes constructive dismissal of the executive including, without limiting the generality of the foregoing: (a) a material decrease in the title, position, responsibility or powers of the executive; (b) a requirement to relocate to another city, province or country; (c) any material reduction in the value of the executive’s benefits, salary, plans and programs, except where all senior executives of the Company are subject to relatively similar reductions in such value; (d) the Company ceases to operate as a going concern; or (e) the Company fails to pay, when due a material amount payable by it to the executive pursuant to the Employment Agreement.

Chase Edgelow, Chief Executive Officer

Mr. Edgelow is entitled to resign at any time.

In the event of termination without cause or termination for good reason, Mr. Edgelow is entitled to receive, within seven (7) business days of the date of termination, or at such time as is mutually agreed upon between the Company and Mr. Edgelow, a lump-sum severance payment equal to the termination compensation (consisting of the monthly base salary that Mr. Edgelow is receiving or entitled to receive at the time of the termination without cause) multiplied by eighteen (18). Any Options, RSUs or DSUs granted by the Company to Mr. Edgelow will be dealt with in accordance with the terms of the Equity Incentive Plan, and any PSUs granted by the Company to Mr. Edgelow will be dealt with in accordance with the terms of the PSU Plan.

In the event of termination subsequent to a change of control and in the further event that (i) Mr. Edgelow’s employment is subsequently or contemporaneously terminated by the Company, or (ii) Mr. Edgelow elects to leave the Company following a change of control, Mr. Edgelow is entitled to receive, within seven (7) business days of the date of termination, a settlement payment equal to the termination compensation multiplied by twenty-four (24). Any Options, RSUs or DSUs granted by the Company to Mr. Edgelow will be dealt with in accordance with the terms of the Equity Incentive Plan, and any PSUs granted by the Company to Mr. Edgelow will be dealt with in accordance with the terms of the PSU Plan.

The Employment Agreement also contains non-solicitation, non-competition and confidentiality provisions which will apply on a termination of employment with the Company. Non-competition and non-solicitation restrictions apply for a period of three (3) years from the date the executive’s employment with the Company ceases, and the confidentiality provisions apply, subject to certain exceptions, for an indefinite period of time following the termination of employment of an executive.

Mischa Zajtmann, President and Corporate Secretary

Mr. Zajtmann is entitled to resign at any time.

In the event of termination without cause or termination for good reason, Mr. Zajtmann is entitled to receive, within seven (7) business days of the date of termination, or at such time as is mutually agreed upon between the Company and Mr. Zajtmann, a lump-sum severance payment equal to the termination compensation (consisting of the monthly base salary that Mr. Zajtmann is receiving or entitled to receive at the time of the termination without cause) multiplied by twelve (12). Any Options or RSUs granted by the Company to Mr. Zajtmann will be dealt with in accordance with the terms of the Equity Incentive Plan, and any PSUs granted by the Company to Mr. Zajtmann will be dealt with in accordance with the terms of the PSU Plan.

In the event of termination subsequent to a change of control and in the further event that (i) Mr. Zajtmann’s employment is subsequently or contemporaneously terminated by the Company, or (ii) Mr. Zajtmann elects to leave the Company following a change of control, Mr. Zajtmann is entitled to receive, within seven (7) business days of the date of termination, a settlement payment equal to the termination compensation multiplied by twenty-four (24). Any Options or RSUs granted by the Company to Mr. Zajtmann will be dealt with in accordance with the terms of the Equity Incentive Plan, and any PSUs granted by the Company to Mr. Zajtmann will be dealt with in accordance with the terms of the PSU Plan.

Jennifer Schilling, Chief Financial Officer

Ms. Schilling is entitled to resign at any time.

In the event of termination without cause or termination for good reason, Ms. Schilling is entitled to receive, within seven (7) business days of the date of termination, or at such time as is mutually agreed upon between the Company and Ms. Schilling, a lump-sum severance payment equal to the termination compensation (consisting of the monthly

base salary that Ms. Schilling is receiving or entitled to receive at the time of the termination without cause) multiplied by: (i) one (1) in the event the termination date is within three (3) months of the effective date of the Employment Agreement; (ii) six (6) in the event the termination date is later than three (3) months from the effective date of the Employment Agreement; or (iii) twelve (12) in the event the termination date is later than three (3) months from the effective date of the Employment Agreement and the Company has completed the Offering (or an event equivalent thereto). Any Options or RSUs granted by the Company to Ms. Schilling will be dealt with in accordance with the terms of the Equity Incentive Plan.

In the event of termination subsequent to a change of control and in the further event that (i) Ms. Schilling’s employment is subsequently or contemporaneously terminated by the Company, or (ii) Ms. Schilling elects to leave the Company following a change of control, Ms. Schilling is entitled to receive, within seven (7) business days of the date of termination, a settlement payment equal to the termination compensation multiplied by eighteen (18). Any Options or RSUs granted by the Company to Ms. Schilling will be dealt with in accordance with the terms of the Equity Incentive Plan.

The Employment Agreement also contains non-solicitation, non-competition and confidentiality provisions which will apply on a termination of employment with the Company. Non-competition and non-solicitation restrictions apply for a period of one (1) year from the date the executive’s employment with the Company ceases, and the confidentiality provisions apply, subject to certain exceptions, for an indefinite period of time following the termination of employment of an executive.

Sean Mezei, Chief Operating Officer

Mr. Mezei is entitled to resign at any time.

In the event of termination without cause or termination for good reason, Mr. Mezei is entitled to receive, within seven (7) business days of the date of termination, or at such time as is mutually agreed upon between the Company and Mr. Mezei, a lump-sum severance payment equal to the termination compensation (consisting of the monthly base salary that Mr. Mezei is receiving or entitled to receive at the time of the termination without cause) multiplied by twelve (12). Any Options or RSUs granted by the Company to Mr. Mezei will be dealt with in accordance with the terms of the Equity Incentive Plan, and any PSUs granted by the Company to Mr. Mezei will be dealt with in accordance with the terms of the PSU Plan.

In the event of termination subsequent to a change of control and in the further event that (i) Mr. Mezei’s employment is subsequently or contemporaneously terminated by the Company, or (ii) Mr. Mezei elects to leave the Company following a change of control, Mr. Mezei is entitled to receive, within seven (7) business days of the date of termination, a settlement payment equal to the termination compensation multiplied by twenty-four (24). Any Options or RSUs granted by the Company to Mr. Mezei will be dealt with in accordance with the terms of the Equity Incentive Plan, and any PSUs granted by the Company to Mr. Mezei will be dealt with in accordance with the terms of the PSU Plan.

Estimated Incremental Payments

The estimated amounts payable under various termination scenarios are outlined in the table below, which estimates assume: (i) a termination date of December 31, 2020; and (ii) that the relevant agreement was entered into on January 1, 2020. In the event that the Company is subject to a change of control with termination, all of the unvested Options and RSUs will become vested.

Name Chase Edgelow, CEO Mischa Zajtmann, President and Corporate Secretary Jennifer Schilling, CFO Sean Mezei, COO	Disability/Death Nil Nil Nil Nil	Resignation Nil Nil Nil Nil	Termination with Cause Nil Nil Nil Nil	Termination without Cause $337,500 $200,000 $15,833(1) $95,000(1) $190,000(1) $200,000	Change of Control with Termination
					$450,000 $400,000 $285,000 $400,000

Notes :

(1) The termination compensation payable to Ms. Schilling in the event of a termination without cause (or for good reason) is determined by multiplying Ms. Schilling’s monthly base salary that she is receiving or entitled to receive at the time of the termination by: (i) one (1) in the event the termination date is within three (3) months of the effective date of the Employment Agreement; (ii) six (6) in the event the termination date is later than three (3) months from the effective date of the Employment Agreement; or (iii)twelve (12) in the event the termination date is later than three (3) months from the effective date of the Employment Agreement and the Company has completed the Offering (or an event equivalent thereto).

Director Compensation

During the financial year ended December 31, 2020, no base annual retainer or fees for attendance at Board meetings were awarded to, earned by, paid to, or payable to the directors.

As officers of the Company, Chase Edgelow and Mischa Zajtmann did not and will not receive compensation for their service as directors and their compensation information is presented in the section relating to executive compensation above.

INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS

None of the directors, executive officers or employees of the Company or former directors, executive officers, or employees of the Company, or its subsidiaries, had any indebtedness outstanding to the Company or its subsidiaries as at the date hereof and no indebtedness of these individuals to another entity is the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by the Company or its subsidiaries as at the date hereof. Additionally, no individual who is, or at any time during the Company’s last financial year was, a director or executive officer of the Company, proposed management nominee for director of the Company or associate of any such director, executive officer or proposed nominee is as at the date hereof, or at any time since the beginning of the Company’s last financial year has been, indebted to the Company or its subsidiaries or to another entity where the indebtedness to such other entity is the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by the Company or its subsidiaries, including indebtedness for security purchase or any other programs.

AUDIT COMMITTEE

The Audit Committee provides assistance to the Board in fulfilling its financial oversight responsibilities and in ensuring the integrity of financial reporting and accounting control policies and practices of the Company. The external auditors of the Company report directly to the Audit Committee. The Audit Committee’s primary duties and responsibilities include: (i) serving as an independent and objective party to oversee the Company’s accounting and financial reporting processes and internal control system including assessing the reasonableness of management accounting judgments and estimates; (ii) reviewing the Company’s financial statements; (iii) requesting such information and explanations in regard to the accounts of the Company as the Audit Committee may consider necessary and appropriate to carry out its duties and responsibilities; (iv) overseeing the audit of the Company’s financial statements; (v) overseeing, reviewing and appraising the qualifications, independence and the performance of the Company’s external auditors; (vi) overseeing the Company’s compliance with legal and regulatory requirements as they relate to accounting and financial controls and anti-corruption and bribery issues; (vii) providing an open avenue of communication among the Company’s auditors, senior management and the Board; (viii) considering any other matters which, in the opinion of the Audit Committee or at the request of the Board would assist the Company

in risk management; and (ix) maintaining the Whistleblower Policy communication channel to the chair of the Audit Committee and whistleblower procedures for the receipt, retention, and treatment of complaints. The full text of the Audit Committee charter is attached to this Prospectus as Appendix “A”.

Composition of the Audit Committee

The Audit Committee is composed of Mary Hemmingsen (chair), Ford Nicholson and Djenane Cameron, two of whom are independent directors and all of whom are financially literate, in each case within the meaning of NI 52110. Mary Hemmingsen and Djenane Cameron are independent directors of the Company. Ford Nicholson is a promoter of the Company. As such, Mr. Nicholson is not an independent director.

Relevant Education and Experience

Each of the members of the Audit Committee has extensive education and experience relevant to the performance of their responsibilities as members of the Audit Committee. Please see “ Directors and Executive Officers – Executive Officer and Director Biographies ”.

Pre-Approval Policies and Procedures

The Audit Committee charter requires that the Audit Committee review and pre-approve all audit and audit-related services and the fees and other compensation related thereto and any non-audit services provided by the Company’s external auditors. The Audit Committee is permitted to delegate pre-approval authority to one or more of its members; however, the decision of any member of the Audit Committee to whom such authority has been delegated must be presented to the full Audit Committee at its next scheduled meeting.

External Auditor Service Fees

Fees billed by the Company’s external auditor, PricewaterhouseCoopers, Chartered Professional Accountants, during the financial year ended December 31, 2020 were as follows:

Fiscal	Year Ending	Audit Fees(1)	Audit Related Fees(2)	Tax Fees(3)	All Other Fees(4)
December	31, 2020	Nil	Nil	Nil	Nil
Notes:

(1) Fees for audit services.

(2) Fees for assurance and related services not included in audit services above.

(3) Fees for tax compliance, tax advice and tax planning.

(4) All other fees not included above.

Reliance on Exemptions

The Company is relying upon the exemption in section 6.1 of NI 52-110 for venture issuers which allows for an exemption from Parts 3 (Composition of the Audit Committee) and 5 (Reporting Obligations) of NI 52-110 and allows for the short form of disclosure of Audit Committee procedures set out in Form 52-110F2.

STATEMENT ON CORPORATE GOVERNANCE

The Company and the Board recognize the importance of corporate governance to the effective management of the Company and to the protection of its employees and shareholders. The Company’s approach to significant issues of corporate governance is designed with a view to ensuring that the business and affairs of the Company are effectively managed so as to enhance shareholder value. The Board fulfills its mandate directly and through its committees at regularly scheduled meetings or at meetings held as required. Frequency of meetings may be increased and the nature of the agenda items may be changed depending upon the state of the Company’s affairs and in light of opportunities or risks which the Company faces. The directors are kept informed of the Company’s business and affairs at these meetings as well as through reports and discussions with management on matters within their particular areas of expertise.

The Board

The Board currently consists of five directors, three of whom are independent based upon the test for director independence set out in NI 52-110. Jon Ozturgut, Mary Hemmingsen and Djenane Cameron are the independent directors of the Company. Chase Edgelow is the Chief Executive Officer of the Company, is a promoter of the Company, and engages in the management of day-to-day operations of the Company. Ford Nicholson is a promoter of the Company. As such, Mr. Edgelow and Mr. Nicholson are not independent directors.

Directorships

As at the date of this Prospectus, none of the Company’s directors serve on the boards of directors of other reporting issuers (or the equivalent) in Canada or foreign jurisdictions.

Orientation and Continuing Education

New members of the Board are provided with: (i) information respecting the functioning of the Board and its committees and a copy of the Company’s corporate governance documents; (ii) access to all documents of the Company, including those that are confidential; and (iii) access to management.

Each new director participates in the Company’s initial orientation program and each director participates in the Company’s continuing director development programs, both of which are reviewed annually by the Board.

Board members are encouraged to: (i) communicate with management and auditors; (ii) keep themselves current with industry trends and developments and changes in legislation with management’s assistance; (iii) attend related industry seminars; and (iv) visit the Company’s operations.

Ethical Business Conduct

The Board has adopted the Code for the directors, officers, employees and representatives of the Company and its subsidiaries. All new employees must read the Code when hired and acknowledge that they will abide by the Code.

The Corporate Governance and Nomination Committee is responsible for monitoring, and reporting to the Board on, compliance with the Code. In accordance with the Code, directors, officers, employees and representatives of the Company and its subsidiaries should raise questions regarding the application of any requirement under the Code, and report a possible violation of a law or the Code, promptly to their supervisor. If reporting a concern or complaint to a supervisor is not possible or advisable, or if reporting it to such person does not resolve the matter, the matter should be addressed with the Chief Executive Officer of the Company.

The Corporate Governance and Nomination Committee reviews the Code at minimum annually and as needed, and makes recommendations of proposed changes to the Board. The Board approves changes to the Code it considers appropriate, at least annually. The Code will be available under the Company’s profile on SEDAR at www.sedar.com.

The Board takes steps to ensure that directors, officers and other employees exercise independent judgment in considering transactions and agreements in respect of which a director, officer or other employee of the Company has a material interest, which include ensuring that directors, officers and other employees are thoroughly familiar with the Code and, in particular, the rules concerning reporting conflicts of interest and obtaining direction from their superior or manager or the Chief Financial Officer regarding any potential conflicts of interest.

The Board encourages and promotes an overall culture of ethical business conduct by promoting compliance with applicable laws, rules and regulations; providing guidance to directors, officers and other employees to help them recognize and deal with ethical issues; promoting a culture of open communication, honesty and accountability; and ensuring awareness of disciplinary action for violations of ethical business conduct.

The Board has also adopted a Whistleblower Policy for individuals to report complaints and concerns regarding, among other things, violations of the Code.

Director Assessment

The Board is responsible for ensuring that an appropriate system is in place to evaluate the effectiveness of the Board as a whole, the individual committees of the Board, and the individual members of the Board and such committees with a view of ensuring that they are fulfilling their respective responsibilities and duties. In connection with such evaluations, each director is required to provide his or her assessment of the effectiveness of the Board and each committee as well as the performance of the individual directors, annually. Such evaluations take into account the competencies and skills each director is expected to bring to his or her particular role on the Board or on a committee, as well as any other relevant facts.

Committees of the Board

In addition to the Audit Committee, the Board has established the Human Resources and Compensation Committee, the Corporate Governance and Nomination Committee, and the Safety and Sustainability Committee.

Audit Committee

See “ Audit Committee ” for further details.

Human Resources and Compensation Committee

The Board has established the Human Resources and Compensation Committee, comprised of Ford Nicholson (chair), Djenane Cameron and Jon Ozturgut, two of whom are independent directors within the meaning of NI 52-110.

The Human Resources and Compensation Committee is responsible for assisting the Board in fulfilling its responsibilities relating to human resources and compensation issues, including determining the overall compensation strategy of the Company and administering the Company’s executive compensation program. As part of its mandate, the Human Resources and Compensation Committee approves the appointment and remuneration of the Company’s executive officers, including the Company’s Named Executive Officers identified in the Summary Compensation Table above. The Human Resources and Compensation Committee is also responsible for reviewing the Company’s compensation policies and guidelines generally, as well as executive compensation disclosure, if any.

Compensation

Please see “ Director and Executive Compensation ” above, which summarizes, among other things, the process by which the Human Resources and Compensation Committee and Board determines the compensation for the Company’s directors and officers.

Human Resources

The Human Resources and Compensation Committee, in consultation with the Chief Executive Officer and President of the Company, is responsible for developing the Company’s human resources strategy. As part of its mandate, the Human Resources and Compensation Committee will be responsible for: (i) reviewing the human resources organizational structure and reports significant organization changes, if any, to the Board; (ii) at least once annually, together with the Chief Executive Officer and the President, reviewing and approving or determining succession plans for the executive officers other than the Chief Executive Officer and the President; (iii) reviewing and recommending to the Board any proposed appointment of any person as an officer of the Company, and to the extent necessary, collaborating with the Corporate Governance and Nomination Committee in the confirmation of the corporate and executive officers of the Company annually; (iv) reviewing and recommending to the Board for approval of any agreements between the Company and senior management employees, other than the Chief Executive Officer and President that address terms of employment, responsibilities, compensation, retirement, termination or other special conditions; (v) reviewing and recommending to the Board for approval any agreement between the Chief Executive Officer and the President that addresses terms of employment, responsibilities, compensation, retirement or other special conditions; (vi) monitoring strategic labour and social issues, such as inclusion, diversity, employment opportunity and employment assistance programs; and (vii) reviewing and monitoring the Company’s practices for

supporting diversity in the workplace, including making recommendations to the Board on matters relating to corporate diversity.

Corporate Governance and Nomination Committee

The Board has established the Corporate Governance and Nomination Committee, comprised of Djenane Cameron (chair), Mary Hemmingsen and Ford Nicholson, two of whom are independent directors within the meaning of NI 52110.

The Corporate Governance and Nomination Committee is responsible for providing a focus on governance itself, and help fulfill the governance value in the Company’s ESG values and performance. The Corporate Governance and Nomination Committee acts as a governance focused resource, staying current on trends and expectations, and holding the Board and the Company accountable to the governance guidelines and policies. This committee supports good governance and promotes the healthy development and functioning of the Board, Board committees, and individual directors. The Corporate Governance and Nomination Committee assesses and makes recommendations regarding governance effectiveness and establishes and leads the process for identifying, recruiting, appointing, re-appointing and providing ongoing development for qualified directors to achieve the Company’s purpose and mission.

As part of its mandate, the Corporate Governance and Nomination Committee, among other things: (i) reviews annually for Board approval the Company’s policies and procedures and the charters, mandates, and roles, as the case may be, for the Board, the chair of the Board, and committees of the Board; (ii) monitors leading governance trends and expectations, comparing annually the Company’s corporate governance practices against those recommended or required by any applicable regulator or stock exchange; (iii) ensures the Company meets all requirements, and where the Company’s practices differ from recommended practices, recommend to the Board whether this is in the best interests of the Company; (iv) recommends to the Board any reports on corporate governance that may be required or considered advisable; (v) monitors political spending and community and other giving activities and recommends any considerations to the Board; (vi) oversees the annual review of the Board, its committees’ and individual directors’ performances, and the Board’s relationship with management; (vii) develops and annually updates and recommends to the Board for approval a long-term plan for Board composition; (viii) in conjunction with the chair of the Board and the Chief Executive Officer, screens and recommends to the Board nominees for election to the Board; (ix) in conjunction with the Board, the chair of the Board and the Chief Executive Officer, recommends committee members and committee chair appointments to the Board for approval, and reviews the need for, and the performance and suitability of, those committees; (x) reviews, monitors and makes recommendations to the Board regarding the orientation and education of directors; (xi) monitors conflicts of interest (real or perceived) of members of the Board and management in accordance with the Code and reports to the Board on compliance with, material departures from, and investigations and any resolutions of complaints received under, the Code and where necessary recommends changes to the Board for approval; (xii) reviews annually, for Board approval, the Company’s policies and procedures and the charters, mandates, and roles, as the case may be, for the Board, the chair of the Board, and committees of the Board; (xiii) ensure, and where necessary make recommendations to the Board in respect of, the Company’s compliance with the requirements of any applicable regulator or stock exchange in respect of the Company’s corporate governance practices; and (xiv) makes such recommendations or undertakes such initiatives in respect of corporate governance as may be required, advisable or desirable for the continued success of the Company.

Nomination of Directors

The Corporate Governance and Nomination Committee assesses potential Board candidates to fill perceived needs on the Board for required skills, expertise, independence and other factors. Members of the Board and representatives of the industry are consulted for possible candidates.

In developing and annually updating and recommending to the Board for approval a long-term plan for Board composition, the Corporate Governance and Nomination Committee takes into consideration, among other things: the independence of each director; the competencies and skills the Board, as a whole, should possess; the current strengths, skills and experience represented by each director, as they affect Board dynamics; retirement dates and succession planning; the appropriate size of the Board, with a view to facilitating effective decision-making; and the diversity of the Board.

The Company does not currently maintain quotas or targets regarding gender representation on the Board or in executive officer positions. All Board appointments will be made taking into consideration what competencies and skills each nominee will bring to the Board, their past business experience, their integrity, their industry knowledge, their ability to contribute to the success of the Company, any past experience of directors or management with potential candidates, their expected contribution to achieving an overall Board which can function as a high performance team with sound judgment and proven leadership, as well as whether or not they can devote sufficient time and resources to his or her duties as a Board member, the diversity of the Board, and any other factors as may be considered appropriate from time to time. The Company recruits, manages and promotes on the basis of an individual’s competence, qualification, experience and performance, regardless of gender, age, ethnic origin, religion, sexual orientation or disability or other aspects of diversity in executive officer positions.

The Board’s mandate encourages a diversity of background skills and experience and personal characteristics among the directors and workforce. As a result, while neither a written policy nor targets relating to the identification and nomination of female directors have been adopted to date and the emphasis in filling Board vacancies is on finding the best qualified candidates given the needs and circumstances of the Board, a nominee’s diversity will be considered favourably in the identification and selection process.

While the Board has not adopted any policies or targets that specifically address the appointment of women to executive officer’s positions, diversity is considered favourably in the identification and selection process and resulted in the appointment of a woman as CFO subsequent to year end.

Safety and Sustainability Committee

The Board has established the Safety and Sustainability Committee, comprised of Jon Ozturgut (chair), Mary Hemmingsen and Chase Edgelow, two of whom are independent directors within the meaning of NI 52-110.

The primary function of the Safety and Sustainability Committee is to assist the Board in fulfilling its oversight responsibilities relating to operating in a safe, environmentally and socially responsible (sustainable) manner and ensuring the integrity of policies and practices with respect to: workforce and public safety in Company activities and at its operating sites; and sustainability in Company activities with respect to people (wellbeing), planet (environmental) and prosperity (community and innovation) considerations. In particular, the Safety and Sustainability Committee is responsible for, among other things: (a) reporting to the Board on matters and items related to the safety and sustainability program of the Company; (b) ensuring that there are appropriate processes in place to facilitate identification of various safety and sustainability risks that may arise from the Company’s operations and related mitigation and possible resulting consequential risks to the Company, its subsidiaries and directors, officers and employees; (c) assessing whether the Company’s safety and sustainability policies are effective, properly implemented and comply with applicable legislation and industry standards; (d) reviewing corporate safety and sustainability activities and performance; (e) reviewing the Company’s method of communicating (internally and externally) safety and sustainability policies, practises and procedures; (f) reviewing and assessing the sufficiency of resources to the Company’s safety and sustainability program; (g) ensuring that appropriate reporting procedures are established relating to safety and sustainability matters by management to ensure adequate reports are made to the chair of the Safety and Sustainability Committee on a regular basis; (h) reviewing insurable risks related to safety and sustainability issues and evaluating adequacy of insurance coverage; and (i) performing any other activities consistent with the Safety and Sustainability Committee’s mandate and generally, covering laws as the Safety and Sustainability Committee or Board deems necessary or appropriate.

The Safety and Sustainability Committee has the authority to retain external legal counsel, consultants or other advisors to assist it in fulfilling its responsibilities, at the expense of the Company. The Safety and Sustainability Committee also has the authority to form and delegate all or a portion of its duties and authority to subcommittees or individuals when appropriate.

CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

In this summary, an otherwise undefined term that first appears in quotation marks has the meaning ascribed to it in the Income Tax Act (Canada) (previously defined as the “ Tax Act ”).

The following sections fairly summarizes the principal Canadian federal income tax considerations under the Tax Act generally applicable as of the date of this Prospectus to an investor who acquires Offered Units pursuant to the Offering. For purposes of this summary, references to Common Shares include the Unit Shares and Warrant Shares unless otherwise indicated. This summary applies only to a purchaser who acquires Unit Shares and Warrants as beneficial owner pursuant to the Offering and (if applicable) Warrant Shares upon the exercise of Warrants, and who, at all relevant times for the purposes of the Tax Act,

deals at arm’s length with the Company and the Underwriters,
is not affiliated with the Company or the Underwriters,
holds all Common Shares and Warrants as capital property, and

is not, at any relevant time for those purposes,

exempt from tax under Part I of the Tax Act,
a “financial institution” for the purposes of the “mark-to-market” property rules in the Tax Act,
a “specified financial institution,”
an entity or partnership an interest in which is a “tax shelter investment,”
a taxpayer that reports its “Canadian tax results” in a currency other than Canadian currency, or
a taxpayer, any of whose Common Shares or Warrants will be the subject of a “derivative forward agreement,” “synthetic disposition arrangement”, or “dividend rental arrangement”

(each such investor, in this summary, a “ Holder ”).

A Holder’s Common Shares and Warrants will generally be considered to be capital property of the Holder provided that the Holder does not use or hold the Common Shares and Warrants in the course of carrying on a business of trading or dealing in securities, and has not acquired or been deemed to have acquired the Common Shares and Warrants in one or more transactions considered to be an adventure or concern in the nature of trade.

This summary is based on the current provisions of the Tax Act and the Income Tax Regulations (Canada) (the “ Regulations ”) in force as of the date hereof, all specific proposals to amend the Tax Act or the Regulations publicly announced by or on behalf of the Minister of Finance of Canada on or before the date hereof, and counsel’s understanding of the current published administrative policies and assessing practices of the CRA. It is assumed that all such amendments will be enacted as currently proposed and that there will be no other change to the Tax Act, the Regulations, or the CRA’s administrative policies and assessing practices, although no assurance can be given in these respects. This summary does not otherwise take into account or anticipate any change in law or administrative policy or assessing practice whether by legislative, governmental, or judicial decision or action, and does not take into account or consider any provincial, territorial or foreign income tax considerations, which may differ significantly from the Canadian federal income tax considerations discussed below.

This summary is of a general nature only, is not exhaustive of all possible Canadian federal income tax considerations and is not intended to be, and should not be construed to be, legal or tax advice to any particular Holder. Each Holder should consult the Holder’s own tax advisers with respect to the tax and legal consequences of acquiring, holding, and disposing of Common Shares and Warrants applicable to the Holder’s particular circumstances.

Allocation of Purchase Price for Offered Units

A Holder who acquires Offered Units pursuant to this Offering will be acquiring ownership of the Unit Shares and Warrants represented by such Offered Units. The Unit Shares and Warrants represented by Offered Units are separate property and, accordingly, Holders will be required to allocate the purchase price paid for each Offered Unit between the Unit Share and the one-half of one Warrant on a reasonable basis in order to determine their respective cost for

the purposes of the Tax Act. For its purposes, the Company intends to allocate $6.32 of the $6.50 Offering Price of each Offered Unit as consideration for the issue of each Unit Share and $0.18 of the $6.50 Offering Price of each Offered Unit as consideration for the issue of each one-half of one Warrant. Although the Company believes that this allocation is reasonable, it is not binding on the CRA or the Holder and the CRA may not be in agreement with such allocation.

Adjusted Cost Base of Common Shares

The adjusted cost base to a Holder of a Unit Share acquired pursuant to the Offering will be determined by averaging the cost of that Unit Share with the adjusted cost base of all other Common Shares (if any) held as capital property by the Holder.

Exercise of Warrants

No gain or loss will be realized by a Holder upon the exercise of a Warrant to acquire a Warrant Share. The Holder’s cost of the Warrant Share will equal such Holder’s adjusted cost base of the Warrant exercised plus the exercise price paid for such Warrant Share. The Holder’s adjusted cost base of such Warrant Share so acquired will be determined by averaging the cost of the Warrant Share with the adjusted cost base of all other Common Shares (if any) held as capital property by such Holder.

Resident Holders

The following section of this summary applies solely to Holders each of whom at all relevant times is or is deemed to be resident solely in Canada for the purposes of the Tax Act (each a “ Resident Holder ”).

A Resident Holder whose Common Shares may not otherwise be capital property may, subject to certain restrictions and limitations in the Tax Act, be entitled to elect irrevocably pursuant to subsection 39(4) of the Tax Act that the Holder’s Common Shares, and every other “Canadian security” of the Resident Holder, be deemed to be capital property for the purposes of the Tax Act. This election does not apply to Warrants. Any Resident Holder who is considering making a subsection 39(4) election should consult the Resident Holder’s Canadian tax advisers before making the election.

Dividends on Common Shares

A Resident Holder who is an individual (other than certain trusts) and receives or is deemed to receive a dividend on the Resident Holder’s Common Shares in a taxation year will be required to include the amount of the dividend in income for the taxation year and be subject to the gross-up and dividend tax credit rules applicable to a “taxable dividend” received from a “taxable Canadian corporation,” including the enhanced gross-up and dividend tax credit rules applicable to any dividend that the Company designates as an “eligible dividend” in accordance with the Tax Act. There may be limitations on the ability of the Company to designate dividends as eligible dividends.

A Resident Holder that is a corporation will generally be required to include the amount of any such dividend in its income for the taxation year, and be entitled to deduct an equivalent amount from its taxable income for the year. In certain circumstances, subsection 55(2) of the Tax Act may deem some or all of the dividend to be proceeds of disposition or a gain from the disposition of capital property rather than a dividend, in which case the rules described below under “ Capital Gains and Capital Losses ” would apply. Corporate Resident Holders should consult their own tax advisers regarding the potential application of subsection 55(2) to their particular circumstances.

A Resident Holder that is a “private corporation” 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), may be subject to tax under Part IV of the Tax Act (which generally is refundable, subject to the detailed rules of the Tax Act) on dividends received or deemed to be received on the Common Shares to the extent that the dividend is deductible in computing the corporation’s taxable income.

Expiry of Warrants

If a Warrant expires unexercised, the Resident Holder will generally realize a capital loss equal to the adjusted cost base of such Warrant to the Resident Holder. The tax treatment of capital losses is discussed in greater detail below under the subheading “ Capital Gains and Capital Losses ”.

Disposition of Common Shares and Warrants

A Resident Holder who disposes or is deemed to dispose of a Warrant (other than on the exercise thereof) or of a Common Share (other than a disposition to the Company in a transaction that is not a sale in the open market in the manner in which shares would normally be purchased by any member of the public in an open market) in a taxation year will generally realize a capital gain (or a capital loss) equal to the amount by which the proceeds of disposition of the security, net of any reasonable costs of disposition, are greater (or less) than the Resident Holder’s adjusted cost base of the security determined immediately before the disposition. The tax treatment of capital gains and capital losses is discussed in greater detail below under the subheading “ Capital Gains and Capital Losses ”.

Capital Gains and Capital Losses

A Resident Holder who realizes or is deemed to realize a capital gain or capital loss in a taxation year will generally be required to include one-half of any such capital gain (a “ taxable capital gain ”) in income for the year, and generally will be required to deduct one-half of any such capital loss (an “ allowable capital loss ”) from taxable capital gains realized by the Resident Holder in the year. Allowable capital losses in excess of taxable capital gains for the taxation year of disposition generally may be carried back and deducted in any of the three preceding taxation years or carried forward and deducted in any subsequent taxation year against net taxable capital gains realized in such years to the extent and under the circumstances specified in the Tax Act.

The amount of any capital loss realized on the disposition or deemed disposition of a Common Share by a Resident Holder that is a corporation may be reduced by the amount of dividends that the Resident Holder received or is deemed to have received on the Common Share or a share substituted therefor, to the extent and in the circumstances specified by the Tax Act. Similar rules may apply to a Common Share owned by a partnership or trust of which a corporation, trust or partnership is a member or beneficiary, as the case may be. Resident Holders to whom these rules may be relevant should consult their own tax advisers.

Refundable Tax

A Resident Holder that is throughout the relevant taxation year a “Canadian-controlled private corporation” may be liable to pay an additional tax (which is generally refundable, subject to the detailed rules of the Tax Act) on certain investment income including taxable capital gains and dividends or deemed dividends that are not deductible in computing taxable income.

Alternative Minimum Tax

A Resident Holder who is an individual (including certain trusts) and realizes a capital gain or receives or is deemed to receive a dividend may thereby be subject to alternative minimum tax under the Tax Act. Such Resident Holders should consult their own tax advisers in this regard.

Non-Resident Holders

The following section of this summary is applicable to Holders each of whom, at all relevant times for the purposes of the Tax Act,

is not, and is not deemed to be, resident in Canada,
does not use or hold, and is not deemed to use or hold, the Common Shares or Warrants in connection with carrying on a business in Canada,

is not an insurer that carries on business in Canada and elsewhere, and
is not an “authorized foreign bank”,

(each a “ Non-resident Holder ”).

Dividends on Common Shares

A Non-resident Holder to whom a dividend is or is deemed to be paid or credited on the Non-resident Holder’s Common Shares will generally be subject to Canadian withholding tax equal to 25% of the gross amount of the dividend, or such lower rate to which the Non-resident Holder is entitled under any applicable income tax treaty between Canada and the country in which the Non-resident Holder is resident. The rate of withholding tax under the Canada-U.S. Tax Convention (1980) (the “ U.S. Treaty ”) applicable to a dividend paid or credited to a Non-resident Holder who beneficially owns the dividend, and is a resident of the United States under the U.S. Treaty and fully entitled to its benefits, is generally limited to 15% of the gross amount of the dividend (or 5% if the Non-resident Holder is a company that owns, or is considered to own, at least 10% of the Company’s voting stock).

Expiry of Warrants

If a Warrant expires unexercised, the Non-resident Holder will generally realize a capital loss equal to the adjusted cost base of such Warrant to the Non-resident Holder. Such capital loss will not be recognized under the Tax Act, unless the Warrant constitutes “taxable Canadian property” to the Non-resident Holder thereof for purposes of the Tax Act and the Non-resident Holder is not entitled to relief under the terms of an applicable tax treaty. See discussion below under the subheading “ Disposition of Common Shares and Warrants ”.

Disposition of Common Shares and Warrants

A Non-resident Holder who disposes or is deemed to dispose of a Common Share or Warrant generally will not be subject to tax under the Tax Act in respect of any capital gain, or be entitled to deduct any capital loss, thereby realized unless the Common Share or Warrant (as applicable), at the time of the disposition,

is, or is deemed to be, “taxable Canadian property”, and
is not “treaty-protected property”,

of the Non-resident Holder.

Generally, a Non-resident Holder’s Common Shares and Warrants should not be taxable Canadian property to the Non-resident Holder at the time of disposition if at that time the Common Shares are listed on a “designated stock exchange” (which currently includes the TSX-V) unless, at the time of disposition or at any time in the preceding 60 months,

the Non-resident Holder, one or more persons with whom the Non-resident Holder did not deal at arm’s length for the purposes of the Tax Act, or one or more partnerships in which the Non-resident Holder or persons with whom the Non-resident Holder did not deal at arm’s length holds or held a membership interest (either directly or indirectly through one or more partnerships), alone or in any combination owned 25% or more of the issued shares of any class of shares of the Company, and
the Common Shares derived more than 50% of their fair market value directly or indirectly from one, or any combination of, real or immovable property situated in Canada, “Canadian resource properties,” “timber resource properties,” or options in respect of, interests in, or for civil law purposes rights in, any such property, whether or not the property exists.

Notwithstanding the foregoing, Common Shares and Warrants may also be deemed to be taxable Canadian property to a Non-resident Holder in certain circumstances.

Generally, a Non-resident Holder’s Common Shares and Warrants will be treaty-protected property at the time of disposition if, at that time, the terms of an applicable tax treaty between Canada and another country exempt the Nonresident Holder from tax under Part I of the Tax Act on any gain from the disposition of the security.

A Non-resident Holder who disposes or is deemed to dispose of a Common Share or Warrant in a taxation year at a time when the Common Share or Warrant is taxable Canadian property and is not treaty-protected property of the Nonresident Holder generally will be required to file a Canadian tax return to report the disposition. If a Non-resident Holder to whom Common Shares and Warrants are taxable Canadian property is not exempt from tax under the Tax Act by virtue of a tax treaty, the consequences described under the subheading “ Resident Holders – Capital Gains and Capital Losses ” should generally apply as though the Non-resident Holder were a Resident Holder.

Non-resident Holders should consult their own tax advisers regarding whether their Common Shares and Warrants are taxable Canadian property or treaty-protected property.

RISK FACTORS

Investing in the Offered Units is speculative and involves a high degree of risk due to the nature of the Company’s business. An investment in the Offered Units should only be made by persons who can afford the total loss of their investment. The following risks, as well as risks currently unknown to the Company, could adversely affect the Company’s current or future business, properties, operations, results, cash flows, financial condition and prospects and could cause future results, cash flows, financial condition, prospects, events or circumstances to differ materially from those currently expected, including the estimates and projections contained in this Prospectus. Investors should carefully consider the risks described below and elsewhere in this Prospectus. The risks described below and elsewhere in this Prospectus do not purport to be an exhaustive summary of the risks affecting the Company and additional risks and uncertainties not currently known to the Company or not currently perceived as being material may have an adverse effect on the Company. Please see “Management’s Discussion and Analysis” for a description of additional risks affecting the Company.

Risks Related to the Company

Operational Risks

Biogas produced by AD is composed of combustible gases which are unstable, flammable and corrosive. Conditions impacting biogas recovery are site-specific. Operational risks include fire, explosion and subsurface gas migration which can result in contact with groundwater. The costs of any of these incidents could have a material adverse effect on the Company’s business, financial condition, results of operations, legal liability, cash flows or prospects.

Environmental Risks

Environmental legislation imposes, among other things, restrictions, liabilities and obligations in connection with the generation, handling, storage, transportation, treatment and disposal of hazardous substances and waste and in connection with spills, releases and emissions of various substances and gases to the environment. In addition, certain types of operations may require the submission and approval of environmental impact assessments. Compliance with environmental legislation can require significant expenditures and failure to comply with environmental legislation may result in the imposition of fines and penalties and liability for cleanup costs and damages. Changes in environmental legislation may require, among other things, reductions in emissions to the air from the Company’s existing and future operations and result in increased capital expenditures. Future changes in environmental legislation could occur and result in stricter standards and enforcement, fines and liability, and increased capital expenditures and operating costs, which could have a material adverse effect on the operations of the Company.

There is no assurance that the Company has been or will at all times be in full compliance with all environmental laws and regulations or hold, and be in full compliance with, all required environmental and health and safety approvals and permits. The FVB Project which has recently been acquired by the Company operates its biogas facility under an Operational Certificate 103921 issued by the British Columbia Ministry of Environment, and in the course of the Company’s due diligence, it was identified that FVB has been in non-compliance with various threshold limits related to the permitted methane and air contaminants discharge. While FVB has never received any notifications or fines from the Ministry of Environment with respect to its non-compliance, the Company is currently in the process of applying for an amended operational certificate (environmental permit) to address any non-compliance issues identified by the Company as part of the FVB Acquisition. The potential costs and delays associated with compliance

with such laws, regulations, approvals and permits could prevent the Company from economically operating or cause increased capital expenditures or operating expenses. Delays in obtaining the necessary permits or meeting conditions to achieve such compliance have the potential of causing additional costs or delays to EverGen’s operations, and any non-compliance with such laws, regulations, approvals and permits or delays necessary to achieve compliance or rectify non-compliance in a changing legal or regulatory landscape could result in a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

Environmental hazards may also exist on the properties on which the Company holds interests whether known or unknown to the Company at present and that have been caused by previous or existing owners or operators of the properties and for which the Company may be liable for remediation. In the course of the Company’s due diligence of FVB, the Company conducted soil sampling from the FVB Project area to test for any contamination in the ground. Through such testing, the Company encountered levels of contamination exceeding the recommended limits, but such contamination was limited to small areas. As part of the Company’s expansion plans of the FVB Project, the Company will conduct remediation plans of the contaminated areas. Furthermore, the Company may experience unforeseen incidents in its operations, giving rise to spills, leaks, contamination, emissions releases, groundwater contact, or a wide variety of other environmental issues. The costs of such remediation, compensation, fines or penalties could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

Regulatory Risks, Including Changes to National and Local Legislation

Renewable energy and RNG regulations are dynamic and subject to evolving interpretations which could require the Company to incur substantial costs associated with compliance or alter certain aspects of its business plan. It is also possible that regulations may be enacted in the future that will be directly applicable to certain aspects of the Company’s operations. The Company cannot predict the nature of any future laws, regulations, interpretations or applications towards renewable energy policies, nor can it determine what effect additional governmental regulations or administrative policies and procedures, when and if promulgated, could have on the Company’s business. Compliance with any such legislation may have a material adverse effect on the Company’s business, financial condition, and results of operations. For example, regulatory approvals or permits may be required for the installation, maintenance, or use of renewable energy, RNG, waste to energy, and related infrastructure projects under federal, provincial and municipal regulations governing renewable energy. To the extent that there are delays in gaining regulatory approval, the Company’s development and growth may be constrained.

In March 2017, the province of British Columbia announced the “Renewable Portfolio Allowance” for renewable natural gas. As part of this initiative, the Government of British Columbia amended the Greenhouse Gas Reduction (Clean Energy) Regulation , prescribed under the Clean Energy Act , to include a renewable portfolio allowance through which natural gas utilities are permitted to acquire up to 5% of their supply from RNG. The net effect of the changes in legislation was that the British Columbia utilities were able to purchase renewable natural gas for up to $30/GJ, a significant premium from prices paid prior to the change in legislation. Supportive government policy with respect to GHG emission reduction currently provides enhanced opportunities for suppliers to produce RNG in British Columbia, however all government policy, laws and regulations are subject to change without notice.

Management expects that the legislative and regulatory environment in the renewable energy industry in Canada will continue to positively develop but still be dynamic for the foreseeable future. The Company’s business may suffer if environmental policies change and no longer encourage the development and growth of renewable energy solutions. Public opinion can also exert a significant influence over the regulation of the renewable energy industry. A negative shift in the public’s perception in the feasibility of renewable energy could affect future legislation or regulations in Canada. There is no assurance that any future changes in environmental regulation will not adversely affect the Company’s operations. Changes in government regulations have the potential to significantly increase compliance costs and thus reduce the profitability of current or future operations.

Reliance on Permits and Authorizations and Delays in Receiving Such Permits and Authorizations

Certain contemplated capital expenditures and installation of RNG, waste to energy, and related infrastructure projects may require the Company to seek approval of appropriate regulatory authorities. There is no guarantee that regulatory authorities will approve any contemplated installation, or expansion and/or renovation, which could adversely affect the business, financial condition and results of the Company’s operations.

EverGen may need to obtain or modify numerous environmental and other regulatory permits, approvals and consents from federal, provincial and local governmental entities, including air permits, wastewater discharge permits, permits or consents related to the management of municipal source separated organics and food waste and permits and consents related to the management and disposal of waste. A number of these permits, approvals and consents must be obtained prior to the start of development of a project. Other permits, approvals and consents, including environmental permits, are required to be obtained at, or prior to, the time of first commercial operation or within prescribed time frames following commencement of commercial operations. Should the relevant authorities fail to issue the necessary permits or authorizations to the Company, the Company may be curtailed or prohibited from proceeding with its RNG, waste to energy, and related infrastructure projects as currently proposed and the business, financial condition and results of operations of the Company may be materially adversely affected.

In addition, once a permit, approval or consent has been issued or acquired for a project, the Company must take steps to comply with the conditions of each permit, approval or consent conditions, including conditions requiring timely development and commencement of the project. Failure to comply with certain conditions within a permit, approval or consent could result in revocation or suspension of such permit, approval or consent; the imposition of penalties; or other enforcement action by governmental entities. See “ Environmental Risks ” above.

The Company’s Renewable Gas Infrastructure Platform May Fail Performance Expectations

The performance of the Company’s RNG, waste to energy and related infrastructure systems may encounter problems due to the failure of the technology of others, the failure to combine these technologies properly, operator error or the failure to maintain and service the systems properly. Although many of these risks are contracted to established system providers via engineering, procurement and construction contracts and the Company’s supply contracts, there are liability limits within each contract. Many potential problems and delays are beyond the Company’s control, such as COVID related factory closures and supply chain disruptions. Any problem or perceived problem with the renewable gas systems, whether originating from its technology, design, or installation, could hurt the Company’s profitability. For example, the Company relies on high solids and tank digester systems, both of which are biological systems that require the right conditions to work effectively.

The Company’s Commercial Success Depends on its Ability to Develop and Operate Individual Renewable Energy Projects

The Company’s specific focus on the renewable energy sector exposes the Company to risks related to the supply of and demand for energy commodities, the cost of capital expenditures, government regulation, world and regional events and economic conditions, and the acceptance of alternative power sources. As a renewable energy producer, the Company may also be negatively affected by lower energy outputs resulting from variable inputs, mechanical breakdowns, technology design flaws or changes to policy or the laws and regulations that mandate the use of organics diversion and renewable energy.

The Company intends to develop or acquire waste to energy projects where biogas is generated from various organic, food, green and agricultural waste via anaerobic digestion and composting in a processing facility. Landfill gas is a viable source of biogas, which provides most of the potential for RNG generation British Columbia. Biogas is generated from AD systems and EverGen secures most of its feedstock supply through long-term “green bin” municipal contracts, in which it is paid “tipping fees” to convert residential organic waste to renewable energy and soil products. EverGen also will acquire feedstock from commercial and agricultural sources, which will be used to generate renewable natural gas via digestion and make an organic fertilizer. The Company’s initial revenues are primarily derived from municipal contracts in the Lower Mainland of British Columbia. Although organics diversion rates and population growth are both increasing in the area, there is no assurance that long-term feedstock rights will be secured or retained, which the Company is dependent on as both its primary source of revenue and as feedstock supply for any future RNG production projects. Cash flow at the SSS Project was primarily generated through the Metro Vancouver Contract which expired on June 30, 2021. On April 16, 2021, EverGen was notified that the Metro Vancouver Contract (which had been the subject of a bid for proposal) had been awarded to another bidder. While EverGen has identified additional sources of organic waste tonnage through the Additional Agreements, a combination of long-term municipal contracts and shorter term merchant agreements, and expects to replace any lost revenue from the Metro Vancouver Contract, there is no assurance that such sources or other long term contracts will be secured on acceptable terms, or at all, which could have a material adverse effect on the Company and at the SSS Project. There

is also no assurance that the Company will be successful in its plans to design, build, own, and operate facilities that convert the organics into RNG, soil products and fertilizer.

In addition, a number of other factors related to the development and operation of individual renewable energy projects could adversely affect the Company’s business, including:

regulatory changes that affect the demand for or supply of renewable gas and the prices thereof, which could have a significant effect on the financial performance of the Company’s projects and the number of potential projects with attractive economics, including changes in government programs and incentives promoting renewable energy or GHG emission reductions;
regulatory changes to agricultural and livestock management policies that could change the incentives and non-compliance penalties for organic waste, manure management and nutrient management rules, which incentivize farming operations to direct their waste to anaerobic digesters;
changes in the broader waste collection industry, including changes affecting the waste collection and organics diversion, which could impede the waste to energy resource that the Company currently targets for its projects;
changes in the permitting processes or rules in the regions where the Company operates or is developing new projects;
changes in energy commodity prices, such as natural gas, diesel fuel, and wholesale electricity prices, which could have a significant effect on the Company’s operating costs;
a decrease in the availability, pricing and timeliness of delivery of raw materials and components necessary for the projects to function;
the competitive landscape as an increased number of RNG production facilities become operational; and
unexpected delays in the development and completion of renewable energy projects as well as unforeseen events giving rise to force majeure or unexpected delays once such projects are operational.

Any of these factors could prevent the Company from completing or operating its projects, or otherwise adversely affect its business, financial condition and results of operations.

Demand for Renewable Energy

The Company’s services largely depend upon the increased use and widespread adoption of and demand for renewable energy. The timeline for when such widespread adoption will take place is uncertain, and may necessitate the Company to markedly change its financial projections. Many factors will influence the widespread adoption of renewable energy and demand for renewable energy projects, including:

cost effectiveness of renewable energy technologies as compared with conventional and competitive technologies;
performance and reliability of renewable energy products as compared with conventional and non-renewable products;
fluctuations in economic and market conditions that impact the viability of conventional and competitive alternative energy sources;
increases or decreases in the prices of oil, coal and natural gas;
continued deregulation of the electric power industry and broader energy industry; and
availability or effectiveness of government subsidies and incentives.

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The Company’s Renewable Energy Projects May Not Generate Expected Levels of Output

The renewable energy projects that the Company constructs and owns are subject to various operating risks that may cause them to generate less than expected amounts of RNG or biogas. These risks include a failure or wearing out of the Company’s or its customers’ or utilities’ equipment; an inability to find suitable replacement equipment or parts; less than expected supply or quality of the project’s source of biogas and faster than expected diminishment of such biogas supply; or volume disruption in the Company’s fuel supply collection system. Any extended interruption and or volume disruption in the project’s operation, or a failure of the project for any reason to generate the expected amount of output, could adversely affect the Company’s business and operating results. The Company may in the future incur material asset impairment charges if any of its renewable energy projects incur operational issues that indicate the expected future cash flows from the project are less than the project’s carrying value. Any such impairment charge could adversely affect the Company’s operating results in the period in which the charge is recorded.

Dependence on Two Current Projects for Operating Revenue

The Company’s only material projects are currently the NZWA Project and the SSS Project, both of which are organic waste commercial composting facilities located on leased lands in British Columbia and which the Company, prior to the recent FVB Acquisition, has been solely dependent on for revenue generation. Although the Company’s strategy is to establish a renewable gas infrastructure platform by acquiring, developing, building, owning and operating a portfolio of RNG waste to energy, and related sustainable infrastructure projects in British Columbia, there is no assurance that the Company will be successful in achieving these objectives which are subject to the numerous other risk factors disclosed in this section. The development of an RNG platform will depend on the Company being able to successfully build out RNG infrastructure at the existing NZWA Project and SSS Project in order to convert soil products to biogas and then upgrade the biogas to RNG and by acquiring additional existing development or operational projects to supplement and build its project portfolio. However, there is no assurance that the Company will meet these objectives which would have a material adverse effect on its business strategy and objectives, financial condition, results of operations, cash flows and prospects.

Relationship with Customers/Suppliers

The Company has long-term compostable waste disposal agreements with a limited number of municipalities. Furthermore, each municipality is the sole source of residential compost disposal for the geographic area in which the municipality is situate. There are no assurances that the contracts the Company has entered into with various municipalities will be renewed or that there will be no interruption in performance or service in existing contracts. The Metro Vancouver Contract on which the SSS Project previously relied upon, expired on June 30, 2021 and on April 16, 2021, EverGen was notified that the Metro Vancouver Contract (which had been the subject of a bid for proposal) had been awarded to another bidder. EverGen has identified additional sources of organic waste tonnage through the Additional Agreements, a combination of long-term municipal contracts and shorter term merchant agreements, and expects to replace any lost revenue from the Metro Vancouver Contract, however there is no assurance that such Additional Agreement will be secured on acceptable terms or at all which could have a material adverse effect on the Company and at the SSS Project. Additionally, there may be a limited number of alternative sources of organic waste from which the Company can source its supply or generate revenues in the event that an issue arises or default or non-renewal occurs with one or more of its existing contracts. There is no assurance that existing or future contracts will be continued or maintained in good standing by the respective parties thereto. If any such issue were to occur, it could prevent the Company from producing RNG or supplying feedstock to other RNG producers and could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

The success of the Company’s business also depends on its ability to develop and secure favourable contracts and sales pipelines to sell RNG generated from its projects. The Company’s focus is to become the dominant supplier of RNG in the form of purified biomethane to FortisBC, the local gas utility in British Columbia, who offers long term (up to 20 years) fixed price RNG offtake agreements, with the largest single arrangement in place being in excess of 2,500 GJ/day. The Company through its subsidiaries, has entered into offtake agreements with FortisBC for the NZWA Project and FVB Project, however there is no assurance that the Company will be successful in maintaining such agreements in good standing or, in the case of the agreement with FVB, extending the FVB Project offtake agreement upon its initial term expiry on October 22, 2022. The FortisBC agreement in respect of the NZWA Project

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is still subject to various conditions precedent in favour of FortisBC, including FortisBC having obtained the approval of the British Columbia Utilities Commission, the Oil & Gas Commission and the Provincial Agricultural Land Commission and NZWA having obtained an executed grant of rights of way and access from the landlord of the NZWA lands in favour of FortisBC. There is no assurance that these conditions precedent will be satisfied and any failure to satisfy any such conditions will result in a termination of the agreement, which would have a material adverse effect on the Company. Upon the conditions precedent being satisfied or waived by FortisBC, there are several obligations that NZWA will be required to maintain, including, but not limited to, minimum monthly and annual biomethane delivery requirements in addition to a 24-month period in which to complete the construction and installation of support facilities on the NZWA lands for FortisBC’s interconnection facilities to the gas distribution grid. A failure to meet any obligations, including any of the foregoing, will afford FortisBC with a right to terminate the agreement and impose on NZWA an obligation to make a termination payment equal to the costs of removing the interconnection facilities and the net book value of any Fortis BC facilities that are required to be stranded (such obligations of which is guaranteed by EverGen). The FortisBC agreement with FVB also contains various obligations, including, but not limited to, minimum or base daily and monthly delivery requirements and in the event of a default, a termination payment is payable by FVB in an amount equal to the net present value of the remaining term of the contract and the depreciated costs to construct any of the FortisBC interconnection facilities that will be stranded. The foregoing termination payment may be significant and if payable will have a material adverse effect on the Company.

In the event the FortisBC agreements cannot be maintained or are terminated, there may be very limited opportunity for the Company or its subsidiaries to secure other long-term contracts at a similar competitive base rate and there is no assurance that it will be successful in securing other sales opportunities that are or become available, and any such failure would be expected to have a material adverse impact on the Company’s business, financial condition, results of operations, cash flows and prospects.

Feedstock and Re-contracting Risk

The Company relies on obtaining long-term municipal contracts for the supply of feedstock materials such as source separated organics. There can be no assurance that the Company will be able to re-contract with any given municipality upon expiry of a given contract, nor is there any assurance that the Company would be able to replace lost feedstock as a result of a failure to renew an existing contract. SSS’s contract with Metro Vancouver expired on June 30, 2021. On April 16, 2021, EverGen was notified that the Metro Vancouver Contract (which had been the subject of a bid for proposal) had been awarded to another bidder. SSS’s cash flow was primarily generated through the Metro Vancouver Contract and the failure to renew or extend such contract could have a material adverse effect on the Company’s business, financial condition, results of operations and cash flow. Although the Company intends to take steps to mitigate the impact of the failure to renew or extend the Metro Vancouver Contract by pursuing the Additional Agreements and other municipal long term contracts or other third parties for feedstock or otherwise, there is no assurance that the Company will be successful in negotiating and obtaining such contracts on a timely basis, or on acceptable terms, or at all, which could have a material adverse effect on the Company’s business, financial condition, results of operations and cash flows.

The Company’s Insurance Coverage May Be Inadequate to Cover Potential Losses

The Company’s business is subject to a number of risks and hazards (as further described in this Prospectus). Although the Company maintains insurance and intends, upon completion of the Offering, to obtain certain additional insurance to protect against certain risks in such amounts as it considers to be reasonable, its insurance will not cover all the potential risks associated with its activities. The Company may also be unable to obtain or maintain insurance to cover its risks at economically feasible premiums, or at all. Insurance coverage may not continue to be available or may not be adequate to cover any resulting liability. Moreover, insurance against risks such as environmental pollution or other hazards as a result of waste contamination, storage or processing may not be available to the Company on acceptable terms. The Company might also become subject to liability for pollution or other hazards which it is not currently insured against and/or in the future may not insure against because of premium costs or other reasons. Losses from these events may cause the Company to incur significant costs which could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

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Maintaining Lease Agreements

The NZWA Project is located on leased lands pursuant to a lease agreement dated April 2, 2012, as assigned and amended by amending agreements dated November 8, 2012 and April 1, 2021. NZWA exclusively leases the lands underlying the NZWA Project for an initial term of ten (10) years that expires December 31, 2022. Provided that it is not in default of the lease agreement, NZWA has the option to renew the lease agreement for three (3) further terms of five (5) years each upon the same terms and conditions as the original lease agreement, other than the base rent, provided that it exercises such option not later than 180 days prior to the expiration of the initial term.

The Company’s ability to continue operating its existing projects and its ability to develop RNG infrastructure on the leased lands will depend on its ability to maintain the lease and licence agreements in good standing and remain in compliance with terms, conditions and covenants contained therein, including compliance with procedures for the renewals thereof. Any failure to maintain the lease and licence agreements in good standing could have a material adverse effect on the NZWA Project, the SSS Project and the Company’s business.

Managing Growth

In order to manage growth and changes in strategy effectively, the Company must: (a) maintain adequate facilities to meet customer demand and comply with contractual obligations; (b) expand sales and marketing capabilities; (c) develop a strategy to build, acquire or supply RNG facilities; (d) expand the skills and capabilities of its current management team; and (e) attract and retain qualified employees. The Company’s expected growth depends on its ability to leverage its industry experience and relationships with customers and vendors to ensure the economic viability of pursued opportunities. While the Company intends to focus on managing its costs and expenses over the long term, it expects to invest to support its growth and may have additional unexpected costs. It may not be able to expand quickly enough to exploit potential market opportunities.

Retention and Acquisition of Skilled Personnel

The loss of any member of the Company’s management team could have a material adverse effect on its business and results of operations. In addition, an inability to hire, or the increased costs of new personnel, including members of executive management, could have a material adverse effect on the Company’s business and operating results. The expansion of the Company’s operations may require the Company to find, hire and retain additional capable employees. New employees often require significant training and, in many cases, take significant time before they achieve full productivity. As a result, the Company may incur significant costs to attract and retain employees, including significant expenditures related to salaries and benefits and compensation expenses related to equity awards, and may lose new employees to its competitors or other companies before it realizes the benefit of its investment in recruiting and training them.

The Directors and Officers May Have Conflicts of Interest with the Company

Certain directors and officers of the Company are or may become associated with other RNG companies which may give rise to conflicts of interest. Directors who have a material interest in any person who is a party to a material contract or a proposed material contract with the Company are required, subject to certain exceptions, to disclose that interest and generally abstain from voting on any resolution to approve such a contract. In addition, directors and officers are required to act honestly and in good faith with a view to the best interests of the Company. Some of the directors and officers of the Company have either other full-time employment or other business or time restrictions placed on them and accordingly, the Company will not be the only business enterprise of these directors and officers. Further, any failure of the directors or officers of the Company to address these conflicts in an appropriate manner or

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to allocate opportunities that they become aware of to the Company could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

Economic and Market Conditions

Financial and securities markets are influenced by the economic and market conditions, such as the developments in the global financial markets or the impact of COVID-19. An economic downturn or volatility could have a material adverse effect on the Company’s business, financial condition and results of operations. A weakening of economic conditions could lead to reductions in demand for RNG, waste to energy, and related infrastructure projects.

Potential Acquisition and Investment Opportunities

In the normal course, the Company regularly evaluates and considers, and may be engaged in discussions and negotiations with respect to, potential acquisition and investment opportunities that it believes may assist it in achieving its business and growth plans, and in connection therewith it may at any time have outstanding non-binding letters of intent or conditional agreements which individually or together may be material. There can be no assurance that any such discussions, negotiations, non-binding letters of intent or conditional agreements will result in a definitive agreement with respect to an acquisition or investment, and, if they do, what the terms or timing of such would be or that such acquisition or investment will be completed by the Company. If the Company does complete any such transaction, it cannot assure investors that the transaction will ultimately strengthen EverGen’s financial or operating results, prospects or competitive position or that it will not be viewed negatively by customers, securities analysts or investors. Such transactions may also involve significant commitments of the Company’s financial and other resources including the completion of additional financings of equity or debt (which may be convertible into equity). Any such activity may not be successful in generating revenue, income or other returns to the Company, and the resources committed to such activities will not be available to the Company for other purposes. See “ The Company will require other available sources of funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations ” below.

Future Acquisitions May Require Significant Expenditures and May Result in Inadequate Returns

The Company may seek to expand through future acquisitions; however, there can be no assurance that the Company will locate attractive acquisition candidates, or that the Company will be able to acquire such candidates on economically acceptable terms, if at all, or that the Company will not be restricted from completing acquisitions pursuant to the terms and conditions from time to time of arrangements with third parties, such as the Company’s creditors. Future acquisitions may require the Company to expend significant amounts of cash, resulting in the Company’s inability to use these funds for other business or may involve significant issuances of equity or debt. See “ The Company will require other available sources of funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations ” below. Future acquisitions may also require substantial management time commitments, and the negotiation of potential acquisitions and the integration of acquired operations could disrupt the Company’s business by diverting management and employees’ attention away from day-to-day operations.

Any future acquisition involve potential risks, including, among other things: (i) the possibility that the Company, as a successor owner, may be legally and financially responsible for liabilities of prior owners; (ii) the possibility that the Company may pay more than the acquired company or assets are worth; (iii) the additional expenses associated with completing an acquisition and amortizing any acquired intangible assets; (iv) an inability to successfully integrate any operation the Company acquired or acquires, as applicable; (v) an inability to recruit, hire, train or retain qualified personnel to manage and operate the operations acquired; (vi) the potential disruption of the ongoing business and the distraction of management from its day-to-day operations; and (vii) the loss of key employees and/or key relationships at the acquired business. In addition, the Company competes with other RNG companies as well as traditional energy companies, which may have greater financial and other resources for new business. Future acquisition candidates may have liabilities or adverse operating issues that the Company failed or fails to discover through due diligence prior to the acquisition. If the Company consummates any future acquisitions with unanticipated liabilities or adverse operating issues, or if acquisition-related expectations are not met, the Company’s business, results of operations, cash flows, financial condition or prospects may be materially adversely affected. The potential impairment or complete

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write-off of goodwill and other intangible assets related to any such acquisition may reduce the Company’s overall earnings and could negatively affect the Company’s balance sheet.

Issuance of Debt and Levels of Indebtedness

From time to time, the Company may enter into transactions to acquire assets or shares of other entities. These transactions may be financed in whole, or in part, with debt, which may increase the Company’s debt levels above industry standards for renewable natural gas companies of similar size. Depending on future development plans, the Company may require additional debt financing that may not be available or, if available, may not be available on favourable terms. The Company’s Articles do not limit the amount of indebtedness that the Company may incur. The level of the Company’s indebtedness from time to time could impair the Company’s ability to obtain additional financing on a timely basis to take advantage of business opportunities that may arise. The Company has currently drawn down on $7,000,000 pursuant to the Roynat Credit Facility, which is secured inter alia against all personal property assets of the Company, NZWA and SSS, a mortgage of lease over the leasehold property at the NZWA Project and a mortgage of license over certain portions of the lands at the SSS Project. The Roynat Credit Facility also contain restrictive covenants and other post-draw down conditions. The Company’s failure to comply with those covenants or conditions could result in an event of default, which, if not cured or waived, could result in the acceleration of the Company’s debt. The Company’s ability to meet its payment obligations will depend on the Company’s financial condition and operating performance, which are subject to prevailing economic and competitive conditions and certain financial, business, regulatory and other factors beyond its control. The Company may be unable to generate or maintain a level of sufficient cash flows to satisfy its debt obligations or to refinance its indebtedness on commercially reasonable terms, or at all, which would have a material adverse effect on the Company’s financial condition and results of operations.

Estimates or Judgments Relating to Critical Accounting Policies

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances, as provided in the notes to the financial statements included in this Prospectus, the results of which form the basis for making judgments about the carrying value of assets, liabilities, equity, revenue and expenses that are not readily apparent from other sources. The Company’s operating results may be adversely affected if the assumptions change or if actual circumstances differ from those in the assumptions, which could cause the Company’s operating results to fall below the expectations of investors, resulting in a decline in the share price of the Company.

Historical and Pro Forma Consolidated Financial Information May Not Be Representative of the Company’s Results as a Combined Entity

The pro forma consolidated financial information included in this Prospectus is compiled from the annual and interim financial statements of the Company and from the annual financial statements of the Predecessor Entities and does not purport to be indicative of the financial information that will result from operations of the combined entity. In addition, the pro forma consolidated financial information included in this Prospectus is based in part on certain assumptions regarding the acquisitions of the Predecessor Entities that the Company believes are reasonable. No assurance can be given that the Company’s assumptions will prove to be accurate over time. Accordingly, the historical and pro forma consolidated financial information included in this Prospectus does not purport to be indicative of what the Company’s results of operations and financial condition would have been had it been a combined entity during the periods presented, or what the Company’s results of operations and financial condition will be in the future. The challenge of integrating previously independent businesses makes evaluating the Company’s business and future financial prospects difficult. The Company’s potential for future business success and operating profitability must be considered in light of the risks, uncertainties, expenses and difficulties typically encountered by recently combined companies.

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Cyberattacks May Cause Disruptions to the Company’s Operations and Could Have a Material Effect on its Business

The Company is dependent on various information technologies to carry out multiple business activities such as, and not limited to, processing, transmitting, and storing electronic information and data used for the safe operation of its assets. A successful cyber intrusion, such as, and not limited to, unauthorized access, malicious software or other violations on the system that control generation and transmission at any of the Company’s offices or facilities could severely disrupt or otherwise affect business operations or diminish competitive advantages. These attacks on the Company’s information base systems through theft, alteration or destruction could lead to litigation, fines, other remedial action, heightened regulatory scrutiny and damage to its reputation. A breach of the Company’s cyber/data security measures could have a material adverse effect on the Company’s business, operations, financial condition and operating results.

The Company’s operations also depend on the timely maintenance, upgrade and replacement of networks, equipment, information technology systems and software, as well as pre-emptive expenses to mitigate the risks of failures. Any of these and other events could result in information system failures, delays and/or increase in capital expenses. The failure of information systems or a component of information systems could, depending on the nature of any such failure, adversely impact the Company’s reputation, results of operations, cash flows and financial condition.

Although to date the Company has not experienced any material losses relating to cyberattacks or other information security breaches, there can be no assurance that it will not incur such losses in the future. The Company’s risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cybersecurity and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access remain a priority. As cyber threats continue to evolve, the Company may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.

Any of these factors could have a material adverse effect on the Company’s results of operations, cash flows and financial position.

The Company May Be Subject to Costly Legal Proceedings

The Company may be subject to legal and regulatory proceedings, including matters involving governmental agencies, entities with whom it does business and other proceedings arising in the ordinary course of business. The Company will evaluate its exposure to these legal and regulatory proceedings and establish reserves for the estimated liabilities in accordance with generally accepted accounting principles. The results of these legal proceedings cannot be predicted with certainty due to the uncertainty inherent in regulatory actions and litigation, the difficulty of predicting decisions of regulators, judges and juries and the possibility that decisions may be reversed on appeal. Defense and settlement costs of legal disputes can be substantial, even with claims that have no merit. Management is committed to conducting business in an ethical and responsible manner, which it believes will reduce the risk of legal disputes. However, if the Company is subject to legal disputes, there can be no assurances that these matters will not have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

The Company will Incur Increased Costs as a Result of Complying with the Reporting Requirements, Rules and Regulations Affecting Public Issuers

As a public issuer, the Company will be subject to the reporting requirements and rules and regulations under the applicable Canadian securities laws and rules of any stock exchange on which the Company’s securities may be listed from time to time. Additional or new regulatory requirements may be adopted in the future. The requirements of existing and potential future rules and regulations will increase the Company’s legal, accounting and financial compliance costs, make some activities more difficult, time-consuming or costly and may also place undue strain on its personnel, systems and resources, which could adversely affect its business and financial condition.

In particular, as a result of the Offering, the Company will become subject to reporting and other obligations under applicable Canadian securities laws, including National Instrument 52-109 – Certification of Disclosure in Issuers’

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Annual and Interim Filings , which requires annual management assessment of the effectiveness of the Company’s internal controls over financial reporting. Effective internal controls, including financial reporting and disclosure controls and procedures, are necessary for the Company to provide reliable financial reports, to effectively reduce the risk of fraud and to operate successfully as a public company. These reporting and other obligations will place significant demands on the Company as well as on the Company’s management, administrative, operational and accounting resources.

COVID-19 May Further Disrupt the Business of the Company

Since December 2019, governments worldwide have been enacting emergency measures to combat the spread of disease caused by the novel coronavirus known as COVID-19. In response to the outbreak, which the World Health Organization declared a pandemic in March 2020, governmental authorities in Canada and internationally have introduced various recommendations and measures to try to limit the COVID-19 pandemic, which include the implementation of travel bans, quarantine periods and physical distancing, all of which have caused material disruption to business globally and resulted in an economic slowdown. As of the date of this Prospectus, the Company has experienced no material impact to its operations or revenues as a result of COVID-19. However, EverGen cannot estimate the duration and severity of the COVID-19 pandemic and its ultimate financial impact. Disruptions resulting from the ongoing pandemic may have a long-term adverse impact on the Company’s results from operations. The ultimate extent of the impact of the COVID-19 pandemic on the Company’s business, financial condition, results of operations, cash flows and prospects will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of the COVID-19 pandemic and actions taken to contain or prevent its further spread, among others. Any of the foregoing events could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows, and prospects.

In addition, the continued impact of COVID-19 may have adverse impacts on the Company, including, among others:

continued disruptions and volatility in the global capital markets, which may increase cost of capital and adversely impact access to capital;
continued impacts on workforces throughout the regions in which COVID-19 is present, which may result in the Company’s workforce being unable to work effectively;
supply chain disruptions; and
impacts that are currently unpredictable.

EverGen continues to work with stakeholders to responsibly address the impact of the global pandemic on operations. EverGen continues to monitor the situation, to assess possible implications to the business, and to take actions in an effort to mitigate adverse consequences.

Global Financial Conditions can Reduce the Price of the Common Shares

Following the onset of the credit crisis in 2008, global financial conditions were characterized by extreme volatility and several major financial institutions either went into bankruptcy or were rescued by governmental authorities. While global financial conditions subsequently stabilized, there remains considerable risk in the system given the extraordinary measures adopted by government authorities to achieve that stability. Global financial conditions could suddenly and rapidly destabilize in response to future economic shocks, as government authorities may have limited resources to respond to future crises. Future economic shocks may be precipitated by a number of causes, including a rise in the price of oil, geopolitical instability, natural disasters, pandemics, epidemics, or similar public health emergencies and other unforeseen events beyond the control of the Company and which may alter market behaviour. Any sudden or rapid destabilization of global economic conditions could impact the Company’s ability to obtain equity or debt financing in the future on terms favourable to the Company. Additionally, any such occurrence could cause decreases in asset values that are deemed to be other than temporary, which may result in impairment losses. Further, in such an event, the Company’s operations and financial condition could be adversely impacted.

Furthermore, general market, political and economic conditions, including, for example, inflation, interest and currency exchange rates, global supply and demand for commodities, political developments, legislative or regulatory changes, social or labour unrest and stock market trends will affect the Company’s operating environment and its

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operating costs, profit margins and share price. Any negative events in the global economy could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects.

It May be Difficult to Enforce Judgments and Effect Service of Process on a Certain Director

A director of the Company resides outside of Canada, therefore, it may not be possible for investors to collect or to enforce judgments obtained in Canadian courts predicated upon the civil liability provisions of applicable Canadian securities laws against such person. Moreover, it may not be possible for investors to effect service of process within Canada upon such person.

Risks Related to the FVB Acquisition

General Risks Relating to the FVB Acquisition

Although EverGen conducted due diligence in connection with the FVB Acquisition, and the Vendors have provided a number of representations and warranties in favour of EverGen in connection with the FVB Acquisition, an unavoidable level of risk remains regarding any undisclosed or unknown liabilities of, or issues concerning, the acquired business. Following the closing of the FVB Acquisition, EverGen may discover that it has acquired substantial undisclosed liabilities or that certain of the representations made by the Vendors were untrue. There can be no assurance of recovery by EverGen from the Vendors for any breach of the representations, warranties or covenants provided, or to be provided, by the Vendors under the FVB Purchase Agreement because there can be no assurance that the amount and length of the indemnification obligations will be sufficient to satisfy such obligations, or that the Vendors will have any assets or continue to exist. EverGen’s inability to claim for full indemnification from the Vendors could have a material and adverse effect on EverGen.

Integration of FVB’s Business

Although management believes that the operations of FVB and EverGen can be successfully integrated, there can be no assurance that this will be the case. EverGen could face impediments in its ability to implement its integration strategy. The integration process may also require substantial attention from management and divert its focus and resources from other strategic opportunities and from operational matters.

Specifically, the successful integration and management of EverGen and FVB as a combined entity is subject to numerous risks that could adversely affect the Company’s growth and profitability, including: (i) the risk that management may not be able to successfully manage FVB’s operations; (ii) the risk that EverGen’s operational, financial and management systems may be incompatible with, or inadequate to effectively integrate and manage systems acquired from FVB; (iii) the risk that the FVB Acquisition may require financial resources that could otherwise be used in the development of other aspects of EverGen’s business; (iv) the risk that the integration process may result in the disruption of EverGen’s and FVB’s ongoing business and customer and employee relationships; (v) the risk that the integration process may result in operational problems, costs, expenses, liabilities, including loss of contracts and customers; and (vi) the risk that key management or employees of FVB may not be retained or may leave following the FVB Acquisition, which could have a significant impact on the combined entity’s operations, specifically if such departures were to occur in positions or roles which require significant technical and operational knowledge and for which qualified replacement personnel is scarce. The successful integration of the FVB Acquisition will also require cooperation between the employees of EverGen and FVB and is subject to the risk that personnel from FVB’s and EverGen’s existing business may not be able to work together successfully, which could adversely impact the Company’s business, financial condition and results of operations.

EverGen’s future financial performance depends in part upon its ability to effectively combine the operations of the acquired business into its existing operations and achieve identified cost savings and other synergies. If it is unable to identify and correct operational or financial weaknesses in the acquired business or to achieve the projected cost savings, its operating results and cash flows could be negatively impacted. Failure to expand operational systems and

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controls or to integrate appropriate personnel at a pace consistent with its growth could also adversely affect its operating results.

Possible Failure to Realize Anticipated Benefits of the FVB Acquisition

The Company believes that the FVB Acquisition will provide certain benefits to the Company. Achieving the benefits of the FVB Acquisition will depend in part on the Company successfully consolidating functions and integrating operations, procedures and personnel in a timely and efficient manner, as well as on EverGen’s ability to realize the opportunities from combining FVB’s businesses and operations with those of EverGen. A variety of factors, including the risk factors set forth in this Prospectus may also adversely affect the likelihood of the anticipated benefits of the FVB Acquisition materializing for the Company or from occurring within the time periods anticipated by the Company. Moreover, even if EverGen is able to integrate FVB’s business and operations successfully, this integration may not result in the realization of the full benefits that the Company currently expects within the anticipated time frame or at all.

Possible Failure to Achieve the Full Amount of Anticipated Cost Synergies

Although management anticipates some cost synergies to be achieved over a period of time following the FVB Acquisition, there can be no certainty the Company will achieve these cost synergies over time, or at all. In addition, expenses required to realize the synergies and the sources of the synergies could differ materially from management expectations and EverGen cannot assure investors that the Company will achieve any level of cost synergies.

Risks Related to the Offered Units

Investors May Lose Their Entire Investment

An investment in the Offered Units is speculative and may result in the loss of an investor’s entire investment. Only potential investors who are experienced in high risk investments and who can afford to lose their entire investment should consider an investment in the Company.

There is No Existing Public Market for the Common Shares or the Warrants

There is currently no existing public market for the Offered Units, the Common Shares or the Warrants, and purchasers of the Offered Units may not be able to resell the Offered Units (or the components thereof) purchased under this Prospectus. This may affect the pricing of the Common Shares or the Warrants in the secondary market, the transparency and availability of trading prices, the liquidity of the Common Shares or the Warrants and the extent of issuer regulation. The Common Shares and Warrants are not currently listed or quoted on any stock exchange or market in Canada or elsewhere. While the Company has applied to have the Common Shares qualified for distribution under this Prospectus, as well as the Company’s existing issued and outstanding Common Shares listed on the TSXV, such listing will be subject to approval by the TSX-V and there is no assurance that such approval will be obtained.

Even if the Offering is successfully completed, the Company cannot offer assurances that an active or liquid trading market will develop or be sustained after the Offering, and in such case the trading price of the Common Shares may decline, and investors may have difficulty selling any of the Common Shares or Warrants that they purchase or acquire by way of the Offering. The Company cannot predict the prices at which the Common Shares will trade. The Offering Price has been determined by arm’s length negotiation between the Company and the Co-Lead Underwriters and may not bear any relationship to the market price at which the Common Shares and Warrants will trade after the Offering, or to any other established criteria of the Company’s value. Shares of companies often trade at a discount to the initial offering price due to sales loads, underwriting discounts and related offering expenses and at prices that may be unrelated to underlying asset values or prospects. The securities of the Company should not be purchased by persons who cannot afford the possibility of the loss of their entire investment.

In addition, in the future, EverGen’s securities may fail to meet the continued listing requirements to be listed on the TSX-V. If the TSX-V delists the Common Shares from trading on its exchange, the Company could face significant material adverse consequences, including:

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a limited availability of market quotations for the Common Shares;
a determination that the Common Shares are a “penny stock” which will require brokers trading in the Common Shares to adhere to more stringent rules and possibly resulting in a reduced level of trading activity in the secondary trading market for the Common Shares;
a limited amount of news and analyst coverage for the Company; and
a decreased ability to issue additional securities or obtain additional financing in the future.

The Warrants will not be Listed for Trading

Since the Company does not intend to apply for listing of the Warrants on any securities exchange, there will not be a public market for the Warrants. There can be no assurance that a secondary market for the Warrants will develop or be sustained after the Closing Date. Even if a market develops for the Warrants, there can be no assurance that it will be liquid and that the price of the Warrants will be the same as the price allocated for the Warrants partially comprising the Units. If an active market for the Warrants does not develop, the liquidity of an investor’s investment in the Warrants may be limited and the price may decline below the portion of the offering price allocated to the Warrants.

The Company May Not Use the Proceeds from the Offering and other Available Funds as Described in this Prospectus

The Company currently intends to use the net proceeds received from the Offering and other available funds as described under “ Use of Proceeds ”. However, the Board and/or management will have discretion in the actual application of the net proceeds and other available funds, and may elect to allocate such funds differently from that described under “ Use of Proceeds ” if they believe it would be in the Company’s best interests to do so. Shareholders may not agree with the manner in which the Board and/or management chooses to allocate and spend the net proceeds and other available funds. The failure by the Board and/or management to apply these funds effectively could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows or prospects. See “ The Company will require other available funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations ” below.

The Company will require other available funds to complete its business objectives and milestones, and if such funds are not available it may need to significantly curtail operations

The Company will require additional funds, to achieve certain business objectives and milestones beyond those described under “ Use of Proceeds ”. The Company is currently in discussions with its existing and other potential lenders to secure additional debt financing. While the Company believes that discussions and negotiations will results in additional debt financing being made available, there is no assurance that any definitive agreement will be reached or that such additional financing will be available on favourable terms, acceptable to the Company, or at all. The Company also anticipates that operating cash flow and the potential to secure government grants related to renewable energy projects will provide additional sources of funds for the Company to achieve its development and expansion plans and other business objectives, however there is no assurance that any such amounts will be available or sufficient to achieve all of the Company’s intended milestones.

The Company may not succeed in securing these other sources of funds that it requires because such funds may not be available to it on acceptable terms, if at all. If the Company does not raise sufficient additional funds, certain objectives within its plan of operation and other development plans will be delayed until such time as it raises sufficient funds, provided it is able to do so. Further, the cost of carrying out its operating and development activities is not fixed, and its cash levels may, at any time, prove to be insufficient to finance operating and development activities. The Company’s financing needs may change substantially because a number of factors which are difficult to predict or which may be outside of its control. Further, even with the net proceeds received from the Offering and on the basis that other potential funds as described under “ Use of Proceeds ” are successfully obtained, the Company could still require additional funding to achieve its business objectives and milestones as described under “ Use of Proceeds ” in the event of, among other things, revisions to project parameters or capital expenditure requirements, project delays and cost overruns and there is no assurance that such additional funding will be obtained.

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Other available source of funds could involve restrictive covenants relating to capital raising activities and other financial and operational matters, which may make it more difficult for the Company to obtain additional capital and to pursue business opportunities, including potential acquisitions. Other available funds may also contain provisions which, if breached, may entitle lenders or their agents to accelerate repayment of loans and/or realize upon security over the assets of the Company, and there is no assurance that the Company would be able to repay such loans in such an event or prevent the enforcement of security granted pursuant to such debt financing.

Dilution from Equity Financing Could Negatively Impact Holders of Offered Units

The Company may from time to time raise funds through the issuance of Common Shares or the issuance of debt instruments or other securities convertible into Common Shares. The Company cannot predict the size or price of future issuances of Common Shares or the size or terms of future issuances of debt instruments or other securities convertible into Common Shares, or the effect, if any, that future issuances and sales of the Company’s securities will have on the market price of the Common Shares. Sales or issuances of substantial numbers of Common Shares, or the perception that such sales or issuances could occur, may adversely affect prevailing market prices of the Common Shares. With any additional sale or issuance of Common Shares, or securities convertible into Common Shares, investors will suffer dilution to their voting power and the Company may experience dilution in its earnings per share.

Equity Securities are Subject to Trading and Volatility Risks

The securities of publicly traded companies can experience a high level of price and volume volatility and the value of the Company’s securities can be expected to fluctuate depending on various factors, not all of which are directly related to the success of the Company and its operating performance, underlying asset values or prospects. These include the risks described elsewhere in this Prospectus. Factors which may influence the price of the Company’s securities, including the Common Shares, include, but are not limited to:

worldwide economic conditions;
fluctuations in the global demand and supply for energy sources;
changes in government policies;
investor perceptions;
movements in global interest rates and global stock markets;
variations in operating costs;
the cost of capital that the Company may require in the future;
the price of inputs necessary for the Company’s operations;
recommendations by securities research analysts;
issuances of equity securities or debt securities by the Company;
operating performance and, if applicable, the share price performance of the Company’s competitors;
the addition or departure of key management and other personnel;
the expiration of the lock-up agreements or other transfer restrictions on outstanding Common Shares;
significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving the Company or its competitors;
news reports relating to trends, concerns, technological or competitive developments, regulatory changes and other related industry and market issues affecting the RNG sector;
litigation;
publicity about the Company, the Company’s personnel or others operating in the industry; and
all market conditions that are specific to the RNG industry.

There can be no assurance that such fluctuations will not affect the price of the Company’s securities, and consequently purchasers of Offered Units may not be able to sell Offered Units at prices equal to or greater than the price or value at which they purchased the Offered Units or acquired them, or their components, by way of the secondary market.

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Sales by Existing Shareholders can Reduce Share Prices

Future sales of Common Shares by existing shareholders could reduce the market price of the Common Shares. Sales of a substantial number of Common Shares in the public market could occur at any time before or after the expiration of the escrow periods under NP 46-201, or lock up periods under voluntary contractual lock up agreements as further described in “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer ”. These sales, or the market perception that the holders of a large number of Common Shares intend to sell, could reduce the market price of the Common Shares and the market price could decline below the Offering Price. If this occurs and continues, it could impair the Company’s ability to raise additional capital through the sale of securities and might cause remaining shareholders to lose all or part of their investment.

Approximately 3,670,564 or 35.7% of the 10,287,392 Common Shares (after giving effect to the deemed exercise of the Special Warrants) are not subject to any form of escrow period, lock up period or resale restriction. Pursuant to the various applicable release schedules, it is anticipated that approximately 5,649,294 Common Shares (54.9% of the Common Shares on the Listing Date prior to giving effect to the Offering) will be liquid and freely tradeable as of the Listing Date. See “ Plan of Distribution ” and “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer ” for descriptions of applicable resale restrictions on the remainder of the Common Shares. Upon expiration of the resale restrictions to which they are subject, additional Common Shares will be freely tradable in the public market, subject to the provisions of applicable securities laws and other contractual restrictions. In addition, 3,080,000 Unit Shares issued pursuant to the Offering (3,542,000 if the Over-Allotment Option is exercised in full), will be free trading and may be resold in the public market immediately. The existence of a large percentage of freely tradeable Common Shares following the completion of the Offering may create significant downward pressure on the trading price of the Common Shares which could have a material adverse effect on the Company.

The Company is Not Likely to Pay Dividends for an Extended Period of Time

The Company has not, since the date of its incorporation, declared or paid any dividends or other distributions on its Common Shares. The Company anticipates that, for the foreseeable future, it will retain its cash resources for the operation and development of its business. The declaration and payment of any dividends in the future is at the discretion of the Board and will depend on a number of factors, including compliance with applicable laws, financial performance, working capital requirements of the Company and such other factors as its directors consider appropriate, and the Company may never pay dividends. Pursuant to the terms of the Roynat Credit Facility, the Company is restricted from paying dividends without the prior written consent of Roynat.

Shareholder Rights

Holders of Warrants will not be entitled to any rights with respect to the Common Shares (including, without limitation, voting rights and rights to receive any dividends or other distributions on the Common Shares), until such time as a holder subsequently exercises its Warrants to become a shareholder of the Company. Any rights with respect to Common Share ownership will arise only if and when the Company delivers Warrant Shares upon the exercise of Warrants. Until such time, the Warrants merely represent a right to acquire Warrant Shares at a fixed price for a limited period of time, after which time any unexercised Warrants will expire and have no further value. Moreover, following the completion of the Offering, the market value of the Warrants, if any, is uncertain and there can be no assurance that the market value of the Warrants will equal or exceed their imputed offering price. There is also no assurance that the market price of the Common Shares will ever equal or exceed the exercise price of the Warrants, and consequently, whether it will ever be profitable for holders of the Warrants to exercise the Warrants.

Public Companies are Subject to Securities Class Action Litigation Risk

In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. If the Company faces such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could materially harm its business.

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If Securities or Industry Analysts do not Publish Research or Publish Inaccurate or Unfavourable Research About the Company’s Business, the Price and Trading Volume of the Common Shares Could Decline

The trading market for the Common Shares will depend on the research and reports that securities or industry analysts publish about the Company and its business. The Company does not have any control over these analysts. The Company cannot assure that analysts will cover it or provide favourable coverage. If one or more of the analysts who cover the Company downgrade its stock or reduce their opinion of the value of the Common Shares, the price of Common Shares would likely decline. If one or more of these analysts cease coverage of the Company or fail to regularly publish reports, the Company could lose visibility in the financial markets, which could cause the price and trading volume of the Common Shares to decline.

PROMOTERS

Mr. Chase Edgelow, the CEO and a director of EverGen, may be considered to be a promoter of the Company in that he took the initiative in organizing the business of the Company. The following table sets out the number and percentage of each class of voting securities and equity securities of EverGen beneficially owned, or controlled or directed, directly or indirectly by Mr. Edgelow.

Designation of Class Common Shares PSUs Options	Number of Securities 450,001 140,000 45,000	Percentage of Class
		4.4%(1) 23.3%(2) 23.1%(3)

Notes:

(1) Based on the total 10,287,392 Common Shares after giving effect to the deemed exercise of the Special Warrants.

(2) Based on the total 600,000 PSUs issued and outstanding pursuant to the PSU Plan. See “ Options to Purchase Securities – PSUs ”.

(3) Based on the total 195,000 Options issued and outstanding pursuant to the Equity Incentive Plan. See “ Options to Purchase Securities – Options ”.

Additional information about Mr. Edgelow is disclosed elsewhere in this Prospectus in connection with his capacity as a director of the Company. See “ Directors and Executive Officers ” and “ Director and Executive Compensation ” for further details.

Mr. Mischa Zajtmann, the President and Corporate Secretary of EverGen, may be considered to be a promoter of the Company in that he took the initiative in organizing the business of the Company. The following table sets out the number and percentage of each class of voting securities and equity securities of EverGen beneficially owned, or controlled or directed, directly or indirectly by Mr. Zajtmann.

Designation of Class Common Shares PSUs Options	Number of Securities 450,001 80,000 45,000	Percentage of Class
		4.4%(1) 13.3%(2) 23.1%(3)

Notes:

(1) Based on the total 10,287,392 Common Shares after giving effect to the deemed exercise of the Special Warrants.

(2) Based on the total 600,000 PSUs issued and outstanding pursuant to the PSU Plan. See “ Options to Purchase Securities – PSUs ”.

(3) Based on the total 195,000 Options issued and outstanding pursuant to the Equity Incentive Plan. See “ Options to Purchase Securities – Options ”.

Additional information about Mr. Zajtmann is disclosed elsewhere in this Prospectus in connection with his capacity as a director and officer of the Company. See “ Directors and Executive Officers ” and “ Director and Executive Compensation ” for further details.

Mr. Ford Nicholson, a director of EverGen, may be considered to be a promoter of the Company in that he took the initiative in organizing the business of the Company. The following table sets out the number and percentage of each class of voting securities and equity securities of EverGen beneficially owned, or controlled or directed, directly or indirectly by Mr. Nicholson.

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Designation of Class Common Shares PSUs DSUs Notes:	Number of Securities 500,001 80,000 6,500	Percentage of Class
		4.9%(1) 13.3%(2) 23.6%(3)

(1) Based on the total 10,287,392 Common Shares after giving effect to the deemed exercise of the Special Warrants.

(2) Based on the total 600,000 PSUs issued and outstanding pursuant to the PSU Plan. See “ Options to Purchase Securities – PSUs ”.

(3) Based on the total 27,500 DSUs issued and outstanding pursuant to the Equity Incentive Plan. See “ Options to Purchase Securities – DSUs

Additional information about Mr. Nicholson is disclosed elsewhere in this Prospectus in connection with his capacity as a director and officer of the Company. See “ Directors and Executive Officers ” and “ Director and Executive Compensation ” for further details.

Other than as disclosed in this Prospectus, neither Mr. Edgelow, Mr. Zajtmann or Mr. Nicholson have received, directly or indirectly, anything of value, including money, property, contracts, options or rights of any kind from EverGen or the Acquired Businesses, and neither EverGen nor the Acquired Businesses have received any assets, services or other consideration from Mr. Edgelow, Mr. Zajtmann or Mr. Nicholson in return.

LEGAL PROCEEDINGS AND REGULATORY ACTIONS

There are no legal proceedings or regulatory actions to which the Company is a party, or has been a party to, or of which any of its property is the subject matter of, or was the subject matter of, since its incorporation, and no such proceedings or actions are known by the Company to be contemplated.

There have been no penalties or sanctions imposed against the Company by a court or regulatory authority, and the Company has not entered into any settlement agreements before any court relating to provincial or territorial securities legislation or with any securities regulatory authority, since its incorporation.

INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

As of the date of this Prospectus, no director, executive officer or shareholder that beneficially owns, or controls or directs, directly or indirectly, more than 10% of the issued Common Shares, or any of their respective associates or affiliates, has any material interest, direct or indirect, in any transaction since the incorporation of the Company which has materially affected or is reasonably expected to materially affect the Company or a subsidiary of the Company.

AUDITOR, TRANSFER AGENT AND REGISTRAR

The Company’s auditor is PricewaterhouseCoopers, Chartered Professional Accountants, having an address at Suncor Energy Centre, 111 5th Avenue SW, Suite 3100, East Tower, Calgary, Alberta T2P 5L3.

The transfer agent and registrar for the Common Shares is TSX Trust Company, having an office at 650 West Georgia Street, Suite 2700, Vancouver, British Columbia V6B 4N9.

MATERIAL CONTRACTS

Except for material contracts entered into in the ordinary course of business, set out below are material contracts to which the Company or any of the Acquired Businesses are a party entered into prior to or since the date of incorporation of the Company and which still remain in effect and are considered to be material to the Company. Copies of such material contracts will be filed with the Canadian securities regulatory authorities and will be available for review under the Company’s profile on SEDAR at www.sedar.com.

Underwriting Agreement, as described under “ Plan of Distribution ”.
NZWA Purchase Agreement, as described under “ General Development and Business of the Company ” .
SSS Purchase Agreement, as described under “ General Development and Business of the Company ”.
FVB Purchase Agreement, as described under “ General Development and Business of the Company ”.

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Roynat Credit Facility, as described under “ General Development and Business of the Company
Special Warrant Indenture, as described under “ Plan of Distribution – Special Warrants ”.
Warrant Indenture, as described under “ Plan of Distribution – Special Warrants ”.
Agency Agreement, as described under “ General Development and Business of the Company ”.

EXPERTS

PricewaterhouseCoopers, the auditor of the financial statements of EverGen included in this Prospectus, has advised the Company that it is independent of the Company in accordance with the Rules of Professional Conduct of the Chartered Professional Accountants of Alberta.

Certain legal matters related to the Offering will be passed upon on the Company’s behalf by Borden Ladner Gervais LLP and on behalf of the Underwriters by Cassels Brock & Blackwell LLP. To the best of the Company’s knowledge, after reasonable inquiry, as of the date hereof, the aforementioned partnerships (and their partners and associates) each beneficially own, directly or indirectly, in the aggregate, less than 1% of the outstanding Common Shares.

STATUTORY AND CONTRACTUAL RIGHTS OF RESCISSION

Securities legislation in certain of the provinces of Canada provides purchasers with the right to withdraw from an agreement to purchase securities. This right may be exercised within two business days after receipt or deemed receipt of a prospectus and any amendment. In several of the provinces, the securities legislation further provides a purchaser with remedies for rescission or, in some jurisdictions, revisions of the price or damages if the Prospectus and any amendment contains a misrepresentation or is not delivered to the purchaser, provided that the remedies for rescission, revisions of the price or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province for the particulars of these rights or consult with a legal advisor.

In an offering of the Warrants, investors are cautioned that the statutory right of action for damages for a misrepresentation contained in the Prospectus is limited, in certain provincial securities legislation, to the price at which the Warrant is offered to the public under the prospectus offering. This means that, under the securities legislation of certain provinces, if the purchaser pays additional amounts upon conversion, exchange or exercise of the security, those amounts may not be recoverable under the statutory right of action for damages that applies in those provinces. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province for the particulars of this right of action for damages or consult with a legal adviser.

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APPENDIX “A” EVERGEN INFRASTRUCTURE CORP. AUDIT COMMITTEE CHARTER

1. Mandate

The primary function of the audit committee (the “ Committee ”) is to assist the Board of Directors (the “ Board ”) in fulfilling its financial oversight responsibilities and in ensuring the integrity of financial reporting and accounting control policies and practices. The Committee approves, monitors, evaluates, advises and makes recommendation in accordance with these terms of reference by reviewing the financial reports and other financial information provided by the Senior Management of EverGen Infrastructure Corp. (the “ Company ”) to regulatory authorities and shareholders, the Company’s systems of internal controls regarding finance and accounting, and the Company’s auditing (including both internal, if any and external audits), accounting and financial reporting processes. Consistent with this function, the Committee will encourage continuous improvement of, and should foster adherence to, the Company’s policies, procedures and practices at all levels. The Committee’s primary duties and responsibilities are to:

(a) serve as an independent and objective party to oversee the Company’s accounting and financial reporting processes and internal control system including assessing the reasonableness of management accounting judgements and estimates;
(b) review the Company’s financial statements;
(c) request such information and explanations in regard to the accounts of the Company as the Committee may consider necessary and appropriate to carry out its duties and responsibilities;
(d) oversee the audit of the Company’s financial statements;
(e) oversee, review and appraise the qualifications, independence and the performance of the Company’s external auditors;
(f) oversee the Company’s compliance with legal and regulatory requirements as they relate to accounting and financial controls and anti-corruption and bribery issues;
(g) provide an open avenue of communication among the Company’s auditors, senior management and the Board;
(h) consider any other matters which, in the opinion of the Committee or at the request of the Board would assist the Company in risk management; and
(i) maintain the Whistleblower Policy communication channel to the chair of the Audit Committee (the “ Chair ”) and whistleblower procedures for the receipt, retention, and treatment of complaints.

For greater clarity, it is not the duty of the Committee to plan or conduct audits or to determine that the Company’s financial statement are complete, accurate and in accordance with Generally Accepted Accounting Principles.

2. Composition and Operation

The Committee is appointed by and shall be comprised of three or more directors as determined by the Board. Each member of the Committee shall be independent within the meaning of the provisions of National Instrument 52-110 – Audit Committees, as may be amended or replaced from time to time (“ NI 52-110 ”). No member of the Committee is permitted to have participated in the preparation of the financial statements of the Company or any current subsidiary at any time during the past three years.

All members of the Committee shall be, in the determination of the Board, “financially literate”, as that term is defined

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by NI 52-110. Each member of the Committee shall be able to read and understand fundamental financial statements, including the Company’s balance sheet, income statement, and cash flow statement.

The Committee members shall be appointed by the Board annually and the Board may at any time remove or replace any member of the Committee and may fill any vacancy with another Board member, as required.

The Board shall appoint the Chair from among the Committee members, preferably possessing a recognized professional accounting designation. If the Chair is not present at any meeting of the Committee, one of the other Committee members present at the meeting shall be chosen by the Committee to preside as the chairperson at the meeting.

Attendance by invitation at all of or a portion of Committee meetings is determined by the CEO or the Chair and would normally include the CEO and CFO of Company, representatives of the external auditors and such other officers or support staff as may be deemed appropriate.

The Committee shall meet a least quarterly.

A majority of members shall constitute a quorum for meetings of the Committee, present in person or via telephone or via other telecommunication device that permits all persons participating in the meeting to speak and hear one another.

The Committee shall fix its own procedures for meetings, keep records of its proceedings, and report to the Board routinely. These procedures will include delivery of notices, agendas, minutes and supporting materials to the Committee members at least (5) days prior to the meeting except in unusual circumstances.

The Committee may engage independent counsel and other advisors as may be deemed or considered necessary and determine the fees of such counsel and advisors.

The Committee shall hold regular in-camera sessions at each meeting, during which the members of the Committee shall meet in the absence of management.

The Committee may act by unanimous written consent of its members. A resolution approved in writing by the members of the Committee shall be valid and effective as if it had been passed at a duly called meeting.

No business may be transacted by the Committee except at a meeting of its members at which a quorum of the Committee is present, or by a unanimous written consent.

Members shall be provided with a minimum of 48 hours’ notice of meetings. The notice period may be waived by all members of the Committee.

3. Responsibilities and Duties

To fulfill its responsibilities and duties, the Committee shall:

(a) Documents/Reports Review
(i) Review this Charter annually, and recommend to the Board any necessary amendments;
(ii) Review and recommend to the Board for approval the audited annual financial statements, with the report of the external auditor, and corresponding management’s discussion and analysis prior to public dissemination and filing with securities regulatory authorities;
(iii) Review and approve, or recommend to the Board for approval, the quarterly financial statements of the Company and corresponding management’s discussion and analysis prior to public dissemination and filing with securities regulatory authorities;

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(iv) Review any other financial disclosure documents that contain material financial information about the Company requiring approval by the Board prior to public dissemination and/or filing with any governmental and/or regulatory authority, including, but not limited to press releases, annual reports, annual information forms, and prospectuses, offering memorandum, or registration statements;
(v) Review the Company’s disclosure in the Management Information Circular and proxy materials including the Committee’s composition and responsibilities and how they are discharged; and
(vi) Review and recommend any changes to the Company’s Disclosure Policy.

(b) External Auditors

“External auditor” as used here shall mean any registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attest services for the Company. Each such external auditor shall report directly to the Committee. With respect to the external auditor, the Committee shall:

(i) Review annually the performance of the external auditors who shall be ultimately accountable to the Board and the Committee as representatives of the shareholders of the Company;
(ii) Review annually management’s recommendations for the appointment or reappointment of the external auditor, the terms of the external auditors engagement, the appropriateness and reasonableness of the proposed audit fees and any unpaid fees;
(iii) Recommend to the Board the appointment, retention and replacement of the external auditors nominated annually for shareholder approval;
(iv) Where there is to be a change in the external auditor, review all issues related to the change, the planned steps for an orderly transition and present the Audit Committee’s recommendation to the Board for approval;
(v) Review with management and the external auditors the audit plan for the year-end financial statements and execute the annual engagement letter with the external auditor and ensure there is a clear understanding between the Board, the Committee, the external auditor and management that the external auditor reported to shareholders and Board through the Committee. The terms of the annual audit plan should include, but not be limited to, the following:
staffing
objective and scope of the external audit work
materiality limits
audit and review reports required,
areas of audit risk
timetable and proposed fees;
(vi) Make recommendations to the Board with respect to the compensation of the external auditor, assess whether fees and any other compensation to be paid to the external auditor

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for audit or non-audit services are appropriate to enable an audit to be conducted and to maintain the independence of the external auditor;

(vii) Review and pre-approve all audit and audit-related services and the fees and other compensation related thereto and any non-audit services provided by the Company’s external auditors. The pre-approval of non-audit services may be delegated to one or more Committee members so long as any such pre-approval decisions are presented to the full Committee at the next scheduled meeting;
(viii) At least annually, and before the auditors issue their report on the annual financial statements, the Committee shall obtain from the auditors a formal written statement describing all relationships between the auditors and the Company; discuss with the auditors any disclosed relationships or services that may affect the objectivity and independence of the auditors; and obtain written confirmation from the auditors that they are objective and independent within the meaning of the applicable Rules of Professional Conduct/Code of Ethics adopted by the provincial institute or order of chartered accountants to which the auditors belong and other applicable requirements including being in good standing. The Committee shall take appropriate action to oversee the independence of the auditors and regarding audit partner rotation;
(ix) Review and discuss with the external auditors any disclosed relationships or services that may impact the objectivity and independence of the external auditors;
(x) Take, or recommend that the full Board take, appropriate action to oversee the independence of the external auditors;
(xi) Oversee the work of the external auditor, including the resolution of disagreements between management and the external auditor regarding financial reporting;
(xii) Review with the external auditor the results of the annual audit and if applicable interim audits, including but not limited to the following:
any difficulties encountered, or restrictions imposed by management, during the annual audit;
any significant accounting or financial reporting issue;
the auditor’s evaluation of Company’s internal controls over financial reporting and management evaluation thereon, including internal control deficiencies identified by the auditor contained in the management letter that have not been previously reported to the Audit Committee;
the auditor’s evaluation of the selection and application of accounting principles and estimates and the presentation of disclosures;
the post-audit or management letter or other material written communication contain any finding or recommendation of the external auditor including management response thereto and the subsequent follow up to any identified internal accounting control weaknesses; and
any other matters which the external auditor should bring to the attention of the Committee;

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(xiii) At each year-end audit meeting, consult with the external auditors, without the presence of management, about the quality of the Company’s accounting principles, internal controls and the completeness and accuracy of the Company’s financial statements;
(xiv) Review and approve the Company’s hiring policies regarding partners, employees and former partners and employees of the present and former external auditors of the Company; and
(xv) Review with management and the external auditor any correspondence with securities regulators or other regulatory or government agencies which raise material issues regarding the Company’s financial reporting or accounting policies.
(c) Financial Reporting Processes
(i) In consultation with the external auditors, review with management the integrity (quality and acceptability) of the Company’s financial reporting process, both internal and external; Such integrity assessment should encompass judgements about the appropriateness, aggressiveness or conservatism of estimates and elective accounting principles or methods and judgements about the clarity of disclosures;
(ii) Consider the external auditors’ judgments about the quality and appropriateness of the Company’s accounting principles as applied in its financial reporting;
(iii) Review any new or pending developments in accounting and reporting standards that may affect the Company, consider the appropriateness of accounting policies and financial reporting practices including alternative treatments that are available for consideration and proposed changes and approve, if appropriate, changes to the Company’s auditing and accounting principles and practices as suggested by the external auditors and management;
(iv) Review key estimates and significant judgments made by management in the preparation of the financial statements and the view of the external auditors as to appropriateness of such judgments;
(v) Following completion of the annual audit, review separately with management and the external auditors any significant difficulties encountered during the course of the audit, including any restrictions on the scope of work or access to required information;
(vi) Review any significant disagreement among management and the external auditors in connection with the preparation of the financial statements. Where there are significant unsettled issues, the Committee shall ensure that there is an agreed course of action for the resolution of such matters;
(vii) Review with the external auditors and management the extent to which changes and improvements in financial or accounting practices have been implemented;
(viii)
Review certification process;
(ix) Establish “whistleblower” procedures for (a) the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters; and (b) the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters. Any such complaints or concerns that are received shall be reviewed by the Committee and, if the Committee determines that the matter requires further investigation, it will direct the Chair of the Committee to engage outside advisors, as necessary or appropriate, to investigate the matter and will work with management and the general counsel to reach a satisfactory

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conclusion. Such procedures shall be reviewed annually by the Committee and any suggested changes shall be submitted to the Board for its approval;

(x) Review any related-party transactions;
(xi) Review with management on at least an annual basis, any material obligations that have been entered into including any off-balance sheet transactions, any litigation, claim or other contingency including tax assessments that could have a material effect upon the financial position or operating results or any compliance requirements and the manner in which they should be disclosed; and
(xii) Review appointment of the Chief Financial Officer and any key financial officers involved in the financial reporting process.

(d) Internal Controls and Internal Audit

(i) Review on a periodic basis the need for an internal audit function and assess the control systems in place that mitigate the need for an internal audit function;
(ii) Obtain reasonable assurance, by discussions with and reports from management and the external auditor that the accounting systems are reliable, the system and security for preparation of financial data reported is adequate and effective and that the system of internal controls over financial reporting is effectively designed and implemented;
(iii) Discuss and review with management, the policies and procedures designed to prevent, identify and detect fraud;
(iv) Receive reports from management on all significant internal control deficiencies and material weaknesses related to financial reporting as identified by management;
(v) Assess cybersecurity and address weaknesses and exposures; and
(vi) Review annually the approval policies and practices concerning the expenses of the Board.

(e) Ethical and Legal Compliance and Risk Management

(i) Review the integrity of the CEO and other senior management and that the CEO and other senior management strive to create a culture of integrity throughout the Company;
(ii) Review the adequacy, appropriateness and effectiveness of the Company’s policies and business practices which impact on the financial integrity of the Company, including those relating to insurance, accounting, information services and systems, financial controls and management reporting;
(iii) In conjunction with any other committee designated by the Board from time to time, review major financial, audit and accounting related risks and the policies, guidelines and mechanisms that management has put in place to govern the process of monitoring, controlling and reporting such risks;
(iv) Review and determine the disposition of any complaints received from any regulatory body; and
(v) Annually review with management, adequacy of insurance coverage including renewal, reasons for change or proposed change in insurance brokers, a list of significant business

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risks to the Company that are not or cannot be insured, such list will include a description of the risk, together with procedures or policies in place to manage the risk.

(f) Anti-Bribery and Anti-Corruption
(i) Review the principal anti-bribery and anti-corruption risks in the Company’s business activities and provide oversight of appropriate systems to manage such risk as applicable to the Company;
(ii) Review and monitor the anti- bribery and anti-corruption policies and activities of the Company on behalf of the Board to ensure compliance with applicable laws, legislation and policies as they relate to anti- corruption and anti-bribery issues; and
(iii) In the event of the occurrence of a corruption or bribery incident, receive and review, without delay, a report from management detailing the nature of the incident. Such report is to be made to the Committee in its entirety, and the Committee will immediately inform the Board at large, which will review the incident and to determine the Company’s disclosure obligations if any.

4. Authority

The Committee:

(a) Has the authority to communicate directly with officers and employees of the Company, its auditors, legal counsel and to such information respecting the Company as it considers necessary or advisable in order to perform its duties and responsibilities. This extends to the requiring the external auditor to report directly to the Committee;
(b) Has the authority to engage independent counsel and other advisors as it deems necessary to carry out its duties and the Committee will set the compensation for such advisors; and
(c) Shall be provided appropriate funding from the Company, as determined by the Committee, for payment of compensation to any registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit review or attest services for the Company, to any advisors employed by the Committee, and for ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties.

The Committee shall also have such other powers and duties as delegated to it by the Board.

5. Accountability

The Committee Chair has the responsibility to report to the Board, as requested, on accounting and financial matters relative to the Company.

The Committee shall report its discussions to the Board by maintaining minutes of its meetings and providing an oral report at the next Board meeting.

The Committee shall review this Charter at least annually and recommend any proposed changes to the Board for approval.

The Committee shall conduct an annual evaluation of the performance of its duties under this Charter and shall present the results of the evaluation to the Board. The Committee shall conduct this evaluation in such manner as it deems appropriate.

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INDEX TO FINANCIAL STATEMENTS AND MANAGEMENT’S DISCUSSION & ANALYSIS

The following financial statements and management discussion & analysis for EverGen Infrastructure Corp. (and its subsidiaries) are included in this Prospectus:

Consolidated MD&A of the Company and of the Predecessor Entities for the period from F-2 incorporation on May 13, 2020 to December 31, 2020, and for the years ended December 31, 2020 and 2019, respectively
Audited consolidated financial statements of the Company as at December 31, 2020, for the period F-32 of incorporation on May 13, 2020 to December 31, 2020
Audited financial statements of Net Zero Waste Abbotsford Inc. as at December 31, 2020 and 2019, F-65 for the years ended December 31, 2020 and 2019
Audited financial statements of Sea to Sky Soils and Composting Inc. as at December 31, 2020 and F-94 2019, for the years ended December 31, 2020 and 2019
MD&A of the Company for the three-month period ended March 31, 2021 F-124
Unaudited interim consolidated financial statements of the Company for the three-month period F-144 ended March 31, 2021
Pro forma consolidated financial statements of the Company, as at December 31, 2020, which give F-170 effect to the Acquisitions of the Predecessor Entities, as if such Acquisitions had taken place on January 1, 2020 for the year ended December 31, 2020

F-1

The following Management’s Discussion and Analysis (“MD&A”) of financial condition and results of operations for EverGen Infrastructure Corp. (“EverGen” or “the Company” which includes references to “we”, “our”, “us”, “its”), is a review of the operations, current financial position and condition for the period from commencement of operations and incorporation on May 13, 2020 to December 31, 2020, and should be read in conjunction with the Company’s audited consolidated financial statements and related notes as at and for the period ended December 31, 2020.

In addition, this MD&A includes a review and analysis of the operations of Net Zero Waste Abbotsford Inc. (“NZWA”) and Sea to Sky Soils and Composting Inc. (“SSS”) for the years ended December 31, 2020 and 2019 as all the issued and outstanding shares of NZWA and SSS were purchased on December 31, 2020.

The consolidated financial statements of EverGen and the stand-alone statements of NZWA and SSS have been prepared in thousands of Canadian dollars, in accordance with International Financial Reporting Standards (“IFRS”), as issued by International Accounting Standards Board (“IASB”), using the accounting policies described therein. Tabular amounts are in thousands of dollars, except where indicated otherwise. This MD&A and the audited annual consolidated financial statements of EverGen have been prepared by management and approved by the board of directors as of July 5, 2021. The stand-alone financial statements of NZWA and SSS were approved by their respective board of directors as of July 5, 2021. EverGen manages its business on the basis of one operating and reportable segment.

EverGen, headquartered in Vancouver, British Columbia is a sustainable infrastructure platform established to acquire, develop, build, own and operate a portfolio of renewable natural gas (“RNG”), waste to energy, and related infrastructure projects in British Columbia and other regions of North America.

This MD&A contains forward-looking statements and introduces financial measures which are not defined under IFRS aimed at helping the reader in making comparisons to metrics similarly disclosed by industry peers. Readers are cautioned that the MD&A should be read in conjunction with the Company’s disclosure under “Non-GAAP Measures” and “Forward-Looking Information” included at the end of this MD&A.

EverGen is a sustainable infrastructure platform and currently owns and operates organic waste processing facilities which also provide organic feedstock for the planned development of RNG infrastructure projects. The Company operates two such organic waste conversion facilities in British Columbia, which primarily process inbound organics, yard waste and biosolids for a contracted tipping fee and produces high-quality organic compost and soils for farmers, gardeners and developers as part of its outbound business. The majority of the revenue currently earned by EverGen is sourced under long-term contracts with local municipalities. From this existing and profitable platform, EverGen plans to initiate the development of RNG facilities and to eventually sell RNG production to Fortis BC.

This MD&A includes the consolidated results of EverGen and separately the stand-alone results of NZWA and SSS where indicated.

F-2

On December 31, 2020, EverGen acquired all the issued and outstanding common shares of NZWA and SSS. The below table includes the financial highlights for EverGen from the date of incorporation.

Revenue	-
Net income (loss)	(2,233)
Net income (loss) per share ($), basic and diluted	$(17.05)
Total assets	50,510
Total long-term liabilities	8,780

EverGen was incorporated on May 13, 2020 for the purposes of contributing to the circular economy through waste recycling and in the development of RNG through sourcing, operating and developing sustainable infrastructure and fulfilling our environmental, societal and governance (“ESG”) values. Circular systems deploy recycling to minimize use of new resource inputs and reduce waste, pollution and carbon emissions.

During the period May 13, 2020 to December 31, 2020, EverGen earned no revenue in its first year of operations with activities focused on establishing a sustainable infrastructure platform and for the acquisitions of NZWA and SSS. The Company incurred a net loss of $2,233, consisting primarily of general and administrative costs related to professional fees, transactions costs for the acquisitions of the operating businesses described below and share-based payment expenses for incentives issued to founders. On December 31, 2020, EverGen acquired NZWA and SSS, the acquired assets and liabilities are reflected in EverGen’s total assets and total long-term liabilities in the table above. The results of operations for NZWA and SSS are expected to be reflective of EverGen’s consolidated results of operations commencing on January 1, 2021 without consideration of additional acquisitions, subject to material contract renewals.

Both NZWA and SSS are private companies earning revenue from the receipt of organic waste at their respective facilities, primarily from municipal customers under contracted tipping agreements. The organic waste facilities are designed and permitted to accept most forms of organic waste from residential, commercial and industrial sources.

Cumulatively, the acquisitions included net assets of $34,042 in exchange for cash consideration of $24,498; contingent consideration of $5,655; and 777,777 common shares in EverGen. The common shares were valued at $5.00 per share using the share price of EverGen on the acquisition date. The preliminary purchase price allocation including contingent consideration may be amended on final adjustments.

In accordance with the holdback provisions and escrow arrangements as attached to the NZWA and SSS share purchase agreements, EverGen paid $5,889 to the escrow agent in trust subsequent to December 31, 2020: (i) 50% of the holdback on February 24, 2021; and (ii) the remaining 50% of the holdback on March 18, 2021. The holdback provisions include standard indemnity provisions and performance driven holdbacks. The indemnity holdbacks are expected to be released from escrow pursuant to customary closing adjustments. The performance driven holdbacks are expected to be released from escrow subject to performance obligations. In addition, the Company’s restricted cash of $319 at December 31, 2020, held in restricted term deposits, as well as $447 collateralized accounts receivable at December 31, 2020, are also restricted subject to these holdback performance obligations and escrow arrangements.

F-3

occurrence of performance obligations, the contingent consideration is expected to be settled from holdbacks held in trust, restricted cash and collateralized accounts receivables.

Transaction costs of $741 related to the acquisitions have been expensed in the consolidated financial statements of EverGen for the period ended December 31, 2020.

These acquisitions have been accounted for as business combinations using the acquisition method whereby the net assets acquired and the liabilities assumed are recorded at fair value and are as follows:

Cash	and cash equivalents	and cash equivalents	294	358	652
Restricted cash			-	319	319
Accounts receivable			413	1,111	1,524
Prepaid expenses and other assets 67				-	67
Inventories			69	58	127
Carbon emission		credits	222	-	222
Property and equipment			6,233	5,364	11,597
Intangible assets			11,590	9,370	20,960
Goodwill			3,420	7,554	10,974
Accounts payable and accrued liabilities (1,008)				(1,649)	(2,657)
Lease liabilities			(2,001)	(1,453)	(3,454)
Deferred tax liabilities			(3,444)	(2,845)	(6,289)


Cash			12,350	12,148	24,498
Common shares			2,222	1,667	3,889
Contingent	consideration		1,283	4,372	5,655

The preliminary purchase price allocation is based on management’s best estimate of the assets acquired and liabilities assumed. Upon finalizing the value of the net assets acquired, adjustments may be required.

NZWA and SSS are considered to be predecessor companies of EverGen under securities law and accounting regulations. As such, a review and analysis of the material results of financial performance and operations are included for reference in this MD&A and discussed below.

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F-4

The below table includes the financial and operational highlights of NZWA and SSS, both wholly-owned subsidiaries of EverGen as of December 31, 2020 on a stand-alone basis.

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Revenue NZWA SSS Net income NZWA SSS Net income per share ($), basic and diluted NZWA SSS EBITDA(1) NZWA SSS Adjusted EBITDA(1) NZWA SSS Capital expenditures NZWA SSS Total assets NZWA SSS Total long-term liabilities NZWA SSS	3,919 4,953 1,094 796 $1,094.00 $0.21 2,063 1,477 2,280 2,023 633 1,207 6,966 7,154 2,092 2,427	3,414 4,647 746 1,529 $746.00 $0.37 1,420 2,341 1,969 2,368 282 919 5,815 5,957 2,085 1,972

Incoming organic feedstock (tonnes) NZWA SSS Organic compost and soil sales (yards)(2) NZWA SSS	49,480 42,869 29,414 32,985	43,996 39,538 27,020 32,733

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EverGen did not generate any revenue for the period ended December 31, 2020. The following discussion covers the revenues generated by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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NZWA
Tipping fees	3,596	3,153	14
Organic compost and soil sales	294	256	15
Other	29	5	480
SSS
Tipping fees	3,281	3,047	8
Organic compost and soil sales	769	700	10
Haulingservices	903	900	-

Both NZWA and SSS generate revenues from organic waste processing via contracted tipping fees and the sale of high-quality organic compost and soils. SSS generates additional revenues from hauling services associated with delivering organic waste to its facility.

NZWA revenue increased by $505 in the year ended December 31, 2020 compared to the previous year. The higher revenue is primarily due to a $443 increase in tipping fee revenue associated with increases in both the volume of incoming organic feedstock and the average rate charged for accepting the volumes. The volume of incoming organic feedstock is measured in tonnes which increased by 5,484 or 12 percent in the year ended December 31, 2020 compared to the previous year.

SSS revenue increased by $306 in the year ended December 31, 2020 compared to the previous year, primarily as a result of the $234 increase in tipping fees. The increase in revenue from tipping fees is largely due to an increase of 3,331 tonnes or 8 percent of incoming organic feedstock.

F-6

EverGen did not incur any cost of goods sold for the period ended December 31, 2020. The following discussion covers the cost of goods incurred by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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NZWA	933	1,360	(31)
SSS	1,924	1,571	22

NZWA’s cost of goods sold decreased by $427 during the year ended December 31, 2020 compared to the previous year primarily as a result of a $485 non-reoccurring charge in the prior year. The non-reoccurring charge relates to fees paid to permitted third-party facilities to receive excess organics. The NZWA facility, now EverGen’s facility, has expanded its own sourcing and acceptance capabilities in 2020 relative to 2019 and expects to reduce the incurrence of these types of fees.

The cost of goods sold incurred by SSS increased by $353 in the year ended December 31, 2020, compared to the previous year as a result of increased hauling charges and fees paid to permitted third-party facilities to receive excess organics. The increase in cost of goods sold is partially offset by $30 of government assistance received by SSS.

SSS operates its facility on a site hosted by and leased from the Lil’Wat Nation and employs individuals from the Lil’Wat Nation. During 2020 and 2019, SSS received payroll grants from the Lil’Wat Nation, which are recorded as a reduction of SSS’s cost of goods sold of $28 in the year ended December 31, 2020 (2019 - $17). The grants relate directly to the employment and education of Lil’Wat Nation members.

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NZWA	2,986	2,054	45
SSS	3,029	3,076	(2)

The gross profit for NZWA increased during the year ended December 31, 2020, compared to the prior year as a result of the increased revenue combined with the decreased cost of goods sold discussed above.

NZWA’s gross profit as a percentage of revenue increased to 76 percent during the year ended December 31, 2020 compared to 60 percent in the prior year. This increase in gross profit resulted from the increased revenue related to additional volumes of organic feedstock processed combined with the decrease in cost of goods sold arising from the expansion of internal processing capabilities and the related non-reoccurring charges in 2019.

Gross profit for SSS in 2020 is consistent with the prior year. The gross profit as a percentage of revenues decreased to 61 percent for the year ended December 31, 2020 compared to 66 percent in the previous year. This decrease in gross profit as a percentage of revenue is due to the increase in cost of goods sold primarily due to costs associated with permitted third-party processing of excess organics more than offsetting the increase in revenues during 2020 as compared to 2019.

F-7

Operating costs are comprised primarily of repairs and maintenance, licenses and permits and property taxes. EverGen did not incur any operating costs for the period ended December 31, 2020. The following discussion covers the operating costs incurred by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and December 31, 2019.

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NZWA	737	389	89
SSS	1,100	455	142

Operating costs increased by $348 and $645 for the years ended December 31, 2020 compared to the previous years for NZWA and SSS, respectively. The increases in operating costs for both NZWA and SSS are attributable to meeting existing compliance requirements and accruing a non-reoccurring compliance related charge of $300 and $550, respectively. The remaining increase in operating costs incurred by both NZWA and SSS relates to increased repairs and maintenance associated with increased activity levels in 2020 compared to the prior year.

General and administrative expenses consist of labour and related benefits costs, professional and consulting fees and other general and administrative expenses.

EverGen incurred general and administrative expenses of $328 primarily related to professional fees in founding the Company during the period ended December 31, 2020.

The following discussion covers the general and administrative expenses incurred by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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NZWA SSS	315 510		281 280		12 82

NZWA’s general and administrative expenses increased by $34 during the year ended December 31, 2020 compared to the previous year due to an increase of $20 of non-reoccurring consulting fees combined with higher labour and related benefits costs.

The increase in SSS general and administrative expenses of $230 relates primarily to an increase in management bonuses in 2020 compared to the prior year. EverGen anticipates the implementation of a management compensation philosophy that includes both cash and non-cash items, including share-based incentive programs, based on operational and corporate performance.

F-8

Operating profit is measured as gross profit, an additional subtotal found in the statement of net income and comprehensive net income, less operating costs and general and administrative expenses and is a non-GAAP measure as defined in the non-GAAP measures section of this MD&A. Management uses this measure to evaluate the efficiency of its operations and considers it to be a key measure of profitability.

During the period ended December 31, 2020, EverGen had a negative operating profit of $328 due to professional fees included in general and administrative expenses with no offsetting gross profit. The following discussion includes the operating profit of NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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NZWA	1,934	1,384	40
SSS	1,419	2,341	(39)

NZWA’s operating profit increased by $550 for the year ended December 31, 2020 compared to the previous year. NZWA’s operating profit as a percent of revenue increased to 49 percent in 2020 compared to 41 percent in the prior year. The increase in operating profit and operating profit as a percentage of revenue is primarily driven by increased revenues in 2020.

SSS’s operating profit decreased by $922 in the year ended December 31, 2020 compared to the prior year. SSS’s operating profit as a percent of revenue decreased from 50 percent in 2019 to 29 percent in 2020. The decrease in operating profit and operating profit as a percentage of revenue is primarily a result of the non-reoccurring charge of $550 as discussed in operating costs, a $207 increase in labour and benefit costs recorded in general and administrative expenses related to management bonuses and $128 of incremental fees related to permitted third-party processing of excess organics.

Management considers EBITDA and adjusted EBITDA key metrics in analyzing operational performance and the Company’s ability to generate cashflow. EBITDA is measured as net income (loss) before interest, tax, depreciation and amortization (“EBITDA”). Adjusted EBITDA is measured as EBITDA adjusted for share-based payment expense and unusual or non-recurring items. EBITDA and adjusted EBITDA are nonGAAP measure as defined in the non-GAAP measures section of this MD&A.

EBITDA for EverGen for the period ended December 31, 2020 was negative $2,521 and adjusted EBITDA

for EverGen was $nil.

The following discussion covers to the changes in EBITDA and adjusted EBITDA for NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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EBITDA
NZWA	2,063	1,420	45
SSS	1,477	2,341	(37)
Adjusted EBITDA
NZWA	2,280	1,969	16
SSS	2,023	2,368	(15)

EBITDA generated by NZWA increased by $643 during the year ended December 31, 2020 as compared to the previous year as a result of the increase in operating profit discussed above and an increase in other income of $93 in 2020.

F-9

EBITDA generated by SSS deceased by $864 in the year ended December 31, 2020, compared to the previous year primarily due to the $922 decrease in operating profit as discussed above and a $58 increase in other income recorded in 2020.

Adjusted EBITDA generated by NZWA increased by $311 in the year ended December 31, 2020 compared to the previous year as a result of the changes in EBITDA partially offset by a decrease in the nonreoccurring items primarily related to the third-party processing of excess organics in 2019. Adjusted EBITDA generated by SSS decreased by $345 in the year ended December 31, 2020, compared to the prior year primarily as a result of increased general and administrative expenses as explained above.

EverGen recorded share-based payment expense of $1,452 in the period ended December 31, 2020. Share-based payment expense include various non-cash incentive programs awarded to founders and advisors of EverGen as consideration for services rendered or recognition of incremental fair value of share capital issued. There was no share-based payment expense recorded in NZWA and SSS during the years ended December 31, 2020 or 2019. Subsequent to December 31, 2020, the Company adopted an equity incentive plan which provides for the granting of options, restricted share units and deferred share units.

Depreciation is recognized on property and equipment including right-of-use assets related to lease contracts.

EverGen did not record any depreciation charges for the period ended December 31, 2020. The following discussion covers the depreciation charges recognized by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and December 31, 2019.

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NZWA	408	319	28
SSS	319	239	33

During the year ended December 31, 2020, depreciation increased in both NZWA and SSS primarily as a result of capital expenditures and an increase in leased assets associated with land acreage expansion throughout 2020 and the corresponding increase in the depreciable value of property and equipment.

Finance costs consists primarily of the interest component of lease payments and interest recognized on loans which is expensed as incurred.

EverGen did not record any finance costs (income), net for the period ended December 31, 2020. The following discussion includes the finance costs, net of finance income, recognized by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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NZWA	195	154	27
SSS	113	128	(12)

Finance costs incurred by NZWA increased during the year ended December 31, 2020 compared to the previous year primarily as a result of an additional $24 of finance costs related to lease liabilities during the year. This increase is due to increased land leases during the year ended December 31, 2020, which expands the Company’s volumetric processing capabilities.

F-10

The decrease in finance costs incurred by SSS during the year ended December 31, 2020 compared to the previous year, is attributable to a decrease in outstanding loans combined with a reduction in finance costs related to lease liabilities.

Other income consists primarily of insurance proceeds and the forgivable portion of certain loans received.

EverGen did not record any other income in the period ended December 31, 2020. The following discussion covers the other income recognized by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

==> picture [463 x 41] intentionally omitted <==

NZWA	129	36	258
SSS	58	-	100

NZWA’s other income increased by $93 in the year ended December 31, 2020 compared to the previous year as a result of insurance proceeds of $109 and loan forgiveness of $20 during 2020. NZWA’s other income for the year ended December 31, 2019 includes $31 related to the sale of carbon emission credits generated by NZWA’s organic waste facility. The demand for carbon emission credits decreased during 2020 as a result of COVID-19.

SSS’s other income during the year ended December 31, 2020, consists of $20 of loan forgiveness and a gain on debt extinguishment with no comparable amounts recorded in the prior year.

Income taxes consist of current and deferred income taxes.

EverGen recorded a deferred tax recovery of $288 during the period between May 13, 2020 and December 31, 2020. The following discussion covers the tax expense recognized by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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NZWA	366	202	81
SSS	249	445	(44)

NZWA’s tax expense for the year ended December 31, 2020 includes current tax expense of $353 and deferred tax of $13, compared to current tax expense of $143 and deferred tax of $59 in the previous year. The increase in current tax expense is driven by an increase in taxable income consistent with the above results of operations discussion.

SSS’s tax expense for the year ended December 31, 2020 includes current tax expense of $142 and deferred tax of $107, compared to $350 and $95, respectively, in the prior year. The decrease in current tax expense is due to a decrease in taxable income as a result of the decrease in net income before tax as discussed throughout this MD&A.

At December 31, 2020, EverGen has approximately $9,000 of cumulative tax pools available for future deduction against taxable income.

F-11

Capital expenditures include purchases of property and equipment used in operations. During the period ended December 31, 2020, EverGen had no capital expenditures. The following discussion covers the capital expenditures incurred by NZWA and SSS, on a stand-alone basis, during the years ended December 31, 2020 and 2019.

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NZWA	633	282	124
SSS	1,207	919	31

During 2020, NZWA incurred $633 of capital expenditures related to the purchase of property and equipment primarily related to leasehold improvements for paving and related groundwork at its waste management facility and other equipment. During the year ended December 31, 2019, capital expenditures incurred by NZWA related primarily to buildings and other equipment to expand the facilities processing capabilities.

In addition to the purchases of property and equipment, NZWA recognized an additional $625 of property and equipment related to leased assets during the year ended December 31, 2020 (2019 - $94). The additional leased assets included incremental acreage to extend processing capacities and additional equipment.

During the year ended December 31, 2020, SSS incurred capital expenditures related primarily to the expansion of its existing organic waste facility and the purchase of equipment. SSS has been awarded a federal grant of $765 under the Organic Infrastructure Program related to the expansion of the organic waste facility, which is expected to be completed in 2021. During the year ended December 31, 2019, capital expenditures included costs related to expansion of the waste facility and equipment used in the separation of various materials.

SSS recognized an additional $187 of property related to leased assets during the year ended December 31, 2020 (2019 - $869). Leased asset additions during 2020 included incremental land and equipment compared to 2019.

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Revenue	-	-	-	-	-	-	-	-
Net income (loss)	(2,227)	(5)	(1)	-	-	-	-	-
Net income (loss) per
share ($), basic and diluted	(6.69)	(2,142.16)	(2.73)	-	-	-	-	-
Adjusted EBITDA(2)	-	-	-	-	-	-	-	-

EverGen was incorporated on May 13, 2020 and net income (loss) in each of the quarters shown is due to share-based payment expenses, transaction costs associated with the acquisitions of NZWA and SSS and non-reoccurring general and administrative expenses related to one-time professional fees.

F-12

==> picture [468 x 51] intentionally omitted <==

Revenue 988 1,040 1,328 563 801 810 1,173 630 Net income 253 123 562 156 47 153 444 102 Net income per share ($), basic and diluted 252.62 123.29 562.43 155.53 47.23 153.25 443.79 102.34 Adjusted EBITDA(1) 476 645 890 269 360 486 800 323	Revenue 988 1,040 1,328 563 801 810 1,173 630 Net income 253 123 562 156 47 153 444 102 Net income per share ($), basic and diluted 252.62 123.29 562.43 155.53 47.23 153.25 443.79 102.34 Adjusted EBITDA(1) 476 645 890 269 360 486 800 323	Revenue 988 1,040 1,328 563 801 810 1,173 630 Net income 253 123 562 156 47 153 444 102 Net income per share ($), basic and diluted 252.62 123.29 562.43 155.53 47.23 153.25 443.79 102.34 Adjusted EBITDA(1) 476 645 890 269 360 486 800 323

On a stand-alone basis, NZWA is exposed to fluctuations in revenue, net income and adjusted EBITDA as a result of the inherent seasonality of organic waste processing and the sale of organic compost and soil with increased seasonal demand in the second quarter. Quarterly fluctuations in adjusted EBITDA are due to seasonal fluctuations combined with the timing of non-reoccurring items identified in the cost of goods sold and operating sections of this MD&A.

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Revenue 1,185 1,299 1,759 710 1,133 1,205 1,654 655 Net income (615) 448 886 77 271 388 787 83 Net income per share ($), basic and diluted (0.16) 0.12 0.24 0.02 0.07 0.09 0.19 0.02 Adjusted EBITDA(1) 84 621 1,051 267 477 602 1,108 181	Revenue 1,185 1,299 1,759 710 1,133 1,205 1,654 655 Net income (615) 448 886 77 271 388 787 83 Net income per share ($), basic and diluted (0.16) 0.12 0.24 0.02 0.07 0.09 0.19 0.02 Adjusted EBITDA(1) 84 621 1,051 267 477 602 1,108 181

On a stand-alone basis, SSS is also exposed to fluctuations in revenue, net income and adjusted EBITDA due to the seasonal nature of both organic waste processing and sale of organic compost and soil with increased demand in the second quarter. Quarterly fluctuations in adjusted EBITDA are due to seasonal fluctuations combined with the timing of non-reoccurring items identified in operating cost section of this MD&A.

The following discussion relates to the consolidated position of liquidity and capital of EverGen as at December 31, 2020.

EverGen’s business currently operates to receive inbound organic municipal waste under contracted tipping fees with municipalities and sell outbound organic compost and soil products to farmers, gardeners and developers. The Company is presently undertaking further development and acquisitions to extend its business into RNG production.

At December 31, 2020, EverGen had cash and cash equivalents of $5,003, of which $319 is restricted, and a working capital deficit of $2,842. The working capital deficit is primarily the result of $5,655 of contingent consideration recognized as part of the acquisitions of NZWA and SSS related to standard indemnity provisions and performance driven holdbacks and working capital adjustments. Pursuant to customary closing adjustments and the occurrence of performance obligations, the contingent consideration is expected to be settled from holdbacks held in trust, restricted cash and collateralized accounts receivables. The cash proceeds from equity and debt offerings completed subsequent to year-end are expected to strengthen the financial condition of EverGen and prepares the Company for further expansion. As at the date of this MD&A, $5,889 has been transferred to trust in accordance with the holdback provisions and escrow arrangements as attached to the NZWA and SSS share purchase agreements. The holdback provisions include standard indemnity provisions and performance driven holdbacks. The indemnity

F-13

holdbacks are expected to be released from escrow pursuant to customary closing adjustments. The performance driven holdbacks are expected to be released from escrow subject to performance obligations.

On May 13, 2020, EverGen was incorporated and the three founding shareholders and directors of the Company, collectively the “Founders”, subscribed to a common share each for $0.01 per common share. On December 16, 2020, the Company:

issued 1,260,000 common shares of EverGen to the Founders on the conversion of convertible notes for funds previously advanced by the Founders; and
in addition, recognized $500 of share-based payment expense related to determining the fair value of these common shares issued to the Founders.

On December 16, 2020, EverGen appointed an additional director and also appointed an additional officer of the Company, (together the “Additional Founders”) and:

issued 140,000 common shares to the Additional Founders at a subscription price of $0.001 per common share; and
in addition, recognized $700 of share-based payment expense related to determining the total fair value of these common shares issued to the Additional Founders.

On December 22, 2020, EverGen:

completed a brokered private placement of 4,617,000 subscription receipts at $5.00 per subscription receipt for gross proceeds of $23,085;
and issued 277,020 share warrants to advisors as consideration for services rendered in connection with this private placement, see share warrants discussion below.

On December 30, 2020, the Company:

completed a non-brokered private placement and issued 1,366,000 common shares at $5.00 per common share for gross proceeds of $6,830;
issued 41,976 common shares with a fair value of $5.00 per common share for advisor services rendered in connection with this private placement; and
issued 62,976 share warrants to advisors as consideration for services rendered in connection with this private placement, see share warrants discussion below.

On December 31, 2020, pursuant to the closing of the acquisitions of NZWA and SSS, each subscription receipt holder received one common share of the Company and the right to receive 0.10 of a common share (each such whole common share being a “share right”) in the event that the Company does not complete a liquidity event by June 22, 2021, for no additional consideration. EverGen determined a fair value of $0.07 per share right and recognized $32 of gross proceeds in share rights and the balance of $23,053 in share capital.

On December 31, 2020, EverGen issued 444,444 common shares and 333,333 common shares as partial consideration for the purchase of all of the issued and outstanding shares of NZWA and SSS, respectively, at a fair value of $5.00 per common share.

The Company actively monitors its capital and operational spending activities to ensure that it can meet its future anticipated obligations incurred from normal ongoing operations, which may require the Company to make adjustments to its capital structure. The Company’s capital structure includes working capital, lease liabilities and shareholders’ equity. Regular reporting of the Company’s liquidity and capital resources is provided to EverGen’s board of directors. To maintain or adjust its capital structure, the Company may issue additional common shares, repay existing debt, seek additional debt financing or adjust its spending or capital expenditures. There is no assurance that any of these will be on acceptable terms to EverGen.

EverGen assesses its ability to meet its on-going obligations using the non-GAAP measures of EBITDA and adjusted EBITDA. These ratios are key measures of liquidity and the management of capital resources.

F-14

At December 31, 2020 the Company had no outstanding credit facilities.

On March 17, 2021, EverGen entered into a credit facility arrangement, providing for a senior secured term loan up of to $7,000, repayable over a term of three years bearing interest at a rate of Canadian Variable Rate plus 3.0 percent per annum. As at July 5, 2021, $6,808 was drawn.

The Company had the following outstanding common shares and equity instruments at December 31, 2020:

0:	0:	0:

ommon shares hare warrants hare rights erformance share units		8,203 340 462 600

On January 12, 2021, EverGen completed a non-brokered private placement of 254,000 common shares at $5,00 per common share for gross proceeds of $1,270.

On January 26, 2021, the Company issued 50,000 common shares with a fair value of $5.00 per common share to an advisor and former shareholder of NZWA as consideration for services rendered in connection with the acquisition of NZWA by EverGen at December 31, 2020. The Company recognized $250 of sharebased payment expense in connection with the fair value of these services rendered for the period ended December 31, 2020.

On March 18, 2021, the Company completed a special warrant financing of 1,059,325 special warrants issued pursuant to prospectus exemptions under applicable securities legislation in certain provinces of Canada (and in jurisdictions outside of Canada in compliance with applicable laws therein) on a private placement basis at a price of $8.00 per special warrant, for aggregate gross proceeds of $8,475.

On March 18, 2021, the Company adopted an equity incentive plan which provides for the granting of Options, restricted share units and deferred share units. In addition, on March 18, 2021, the Company granted (i) 195,000 Options to officers, an employee and consultants of the Company; (ii) 17,500 restricted share units to an officer and consultants of the Company and (iii) 27,500 deferred share units to its directors.

On April 27, 2021, EverGen completed a non-brokered private placement of 111,111 common shares at a price of $9.00 per common share for gross proceeds of $1,000.

On June 22, 2021, the deadline for completing a liquidity event expired and the holders of 461,699 share rights became entitled to receive one common share of EverGen for each share right held or 461,699 common shares of EverGen in the aggregate for no additional consideration. As at July 5, 2021, these common shares have not been issued.

On June 29, 2021, the Company granted 100,000 restricted share units to an officer of the Company.

F-15

On July 5, 2021, the Company had the following outstanding common shares and equity instruments outstanding:

ommon shares hare warrants hare rights tock options erformance share units estricted share units eferred share units	ommon shares hare warrants hare rights tock options erformance share units estricted share units eferred share units	9,825(1) 911(2) 462 195 600 118 28

(1)

(1)

(2)

EverGen’s ability to continue to grow our business and generate improvements in our financial performance depends on the execution of our strategy to build, own and operate a portfolio of RNG, waste to energy and related sustainable infrastructure projects in British Columbia and other regions in North America including:

development and construction of existing portfolio of RNG expansion projects;
optimization and expansion of organic waste processing facilities and RNG feedstock;
continued growth of project portfolio via strategic acquisitions and consolidation opportunities; and
� advancement of RNG project expansions.

The Company is uniquely positioned with the prospect to capture expansion in both compost and RNG markets. The organic compost and soil industry provides opportunities in agriculture, home gardening, landscaping, horticulture and construction due to increasing demand for organic products and growing awareness regarding the disadvantages of chemical fertilizers and pesticides. The RNG industry is set to grow rapidly over the next several decades based on increased availability of various feedstock and increased customer demand for lower carbon energy alternatives.

EverGen’s ability to identify, execute and integrate accretive acquisitions is a key driver of our growth. Given the significant fragmentation that exists in the North American market, our growth and success depends on our ability to realize consolidation opportunities and achieve synergies in cost and margin through the operation and expansion of facilities under a unified business platform. The identification and execution of acquisitions and consolidation opportunities as well as the integration of such into a common operating platform, with shared services and efficiency optimizations, is a key factor to our success. The successful execution of acquisitions opens new markets to EverGen, provides us with additional growth opportunities and drives further procurement and cost synergies across our operations.

The Company currently provides high-value services and high-quality products through strategically located projects in British Columbia. These projects provide the foundation of our initial platform to consolidate growth and realize operational and capital efficiencies. In each of our local markets, our strong competitive position is supported by asset management discipline, investment in sustainable infrastructure and collaborative stakeholder relationships. EverGen’s continued success depends on our ability to leverage our scalable network and platform to build relationships with municipal, commercial and utility customers, realize operational and capital efficiencies, and extract procurement and cost synergies.

F-16

EverGen’s collaboration approach propels growth and extends our execution capabilities across our value chain and supply chain. Key relationships with local developers, First Nations and other stakeholders provide access to projects and leverage our capabilities in sourcing new organic waste streams and extending out our business model to fulfill societal and customer expectations of waste recycling and waste to energy production combined with reduced greenhouse gas emissions.

The above strategy is implemented in conjunction with our commitment to deliver on societal trends and expectations of a circular economy and fulfilling ESG values. EverGen was established for the purpose of contributing to a circular economy in waste recycling and waste to energy production through sourcing, operating and developing sustainable infrastructure and fulfilling our ESG values.

EverGen intends to deliver on its ESG values as follows:

– The Company recycles and repurposes organic waste products, expects to produce renewable
energy and reduces greenhouse gas emissions;
– EverGen operates as a community-focused business, receiving and recycling organic waste
from local municipalities and businesses and focused on partnering with local First Nations including as hosts for its operations and as workforce participants; and
– The Company is committed to strong governance practices in its current operations and in
planned growth and development of RNG. EverGen is dedicated to developing a sustainable business platform through collaboration with stakeholders, communities, First Nations, employees and contractors, customers and investors and through responsible development, disciplined asset management, financial strength and resiliency and the capacity to operate and grow sustainably.

EverGen is proactively engaging with local businesses, such as restaurants and food and beverage producers and distributors, to advance socially conscious commerce, to create mutually beneficial and socially responsible alternatives to traditional waste disposal and in achieving a reduced carbon footprint. These relationships represent a significant area of growth and diversification from EverGen’s existing customer base and provide the opportunity for market expansion while fulfilling expectations of directing organic waste for recycling and the production of renewable energy.

EverGen’s business and financial performance, which includes our results of operations and cash flows, are impacted by a number of risks. Many of these risks are outside of our control. The risks and uncertainties described below are not the only risks that the Company faces. Additional risks and uncertainties, including those of which management is not currently aware of or which are currently deemed immaterial, may adversely affect the Company. Any of these factors, either alone or taken together, could have a material adverse effect on the Company and could change whether any forwardlooking statements are ultimately realized.

These risks cannot be eliminated, however, EverGen’s management is committed to proactively monitoring, and where possible, mitigating risk. Issues affecting, or with the potential to affect, the Company’s assets, operations and/or reputation, are generally of a strategic nature or are emerging issues that can be identified early and then managed, but occasionally include unforeseen issues that arise unexpectedly and must be managed on an urgent basis. EverGen takes a proactive approach to the identification and management of issues that may affect the Company’s assets, operations and/or reputation and has established consistent and clear policies, procedures, guidelines and responsibilities for issue identification, management and mitigation.

F-17

In March 2020, the World Health Organization declared a global pandemic due to the Novel Coronavirus known as COVID-19. COVID-19 has significantly impacted the global economy. The full extent and impact of the COVID-19 pandemic to the Company’s operations and future financial performance is unknown at this time and depends on a number of future developments which are uncertain and unpredictable. These future developments include the duration and spread of COVID-19, its continued impact on capital and financial markets, including ongoing economic concerns, and new information that may emerge concerning the severity of the virus. These uncertainties may continue beyond the determination of how to contain the virus and treatment of those impacted. The ongoing pandemic presents uncertainty and risk to the Company, its performance, and the estimates and assumptions used by management to prepare its financial results.

EverGen has been established for the purposes of establishing and contributing a circular economy in waste recycling and in waste to energy production through sourcing, operating and developing sustainable infrastructure while fulfilling the Company’s ESG values. EverGen seeks to engage meaningfully with stakeholders, relies on our commitment to our ESG values regarding sustainable development, contributing to a circular economy and in operating a platform of high-quality anaerobic digestion technology. All of these contribute to what management believes is a differentiator from the Company’s competitors in the region.

If EverGen fails to implement our business strategy, our financial performance and projected growth could be materially and adversely affected. Our key stakeholders, including but not limited to employees, advisors, contractors, customers, First Nations communities and investors, may not embrace and support our strategy.

EverGen’s business strategy is focused on building a renewable energy platform to meet the increasing demand for socially responsible energy production and consumption of energy derived from renewable sources. The Company’s revenue sources of tipping fees and sales of organic compost and soil products are expected to provide the necessary cash flows to support the transition to RNG. EverGen expects to realize on the societal and local trust in policies, programs and demand for more waste recycling and RNG production.

The Company’s renewable energy platform embraces a diversified portfolio investment approach which includes multiple projects, both conversions and upgrades, and increases our opportunity for development and expansion. Both new and existing projects are evaluated on an individual risk-adjusted basis and on a collective risk-adjusted basis. There is no assurance that projects will provide the anticipated or expected level of return. The Company’s RNG infrastructure platform may fail performance expectations and the renewable energy projects may not generate the expected levels of output.

The Company’s commercial success depends on its ability to develop and operate individual renewable energy products. The size and sustainability of the market for renewable energy is not guaranteed.

Our planned RNG development may not occur at all, may not occur in the expected time frame or may involve the divestiture of certain businesses, projects or assets, which may negatively affect our future business and financial results. We may not realize the strategic benefits and cost synergies that are anticipated from the planned RNG development.

EverGen’s ability to make strategic acquisitions depends on our capacity to identify desirable acquisition targets, negotiate advantageous transactions despite competition for such opportunities, fund such acquisitions on terms favorable to EverGen, obtain regulatory approvals and realize the expected benefits of such transactions. The Company proactively manages its rate of growth through strategic and timely

F-18

acquisitions, the development of key management capabilities and the engagement of advisors as considered appropriate.

Acquisitions and other investments made in conjunction with our expansion to RNG production and renewable energy infrastructure may not increase our results of operations in the timeframe anticipated or at all. EverGen may face difficulties in operating in new or expanded markets and to provide new revenue sources. The Company may face acquisition integration challenges such as the failure to operate within budget, failure to implement the planned operational efficiencies or such efforts may not yield the intended results. EverGen may not be able to achieve or maintain the cost savings planned through optimization efforts and synergies. The historical financial information of NZWA and SSS and the proforma consolidated financial information of EverGen may not be representative of the Company’s results as a combined entity.

The integration of acquisitions by EverGen could increase our exposure to the risk of inadvertent noncompliance with laws and regulations. Liabilities associated with acquisitions, including known liabilities and ones that may exist only because of past operations of an acquired business, may provide to be more difficult or costly to address than originally anticipated.

Future acquisitions may require significant resources including financial means, which may not result in adequate returns for EverGen’s shareholders.

There is uncertainty of EverGen’s ability to successfully market its business in the areas in which it operates, global financial conditions are subject to increased volatility and there is no guarantee that the business environment in which EverGen operates in will remain substantially unchanged.

EverGen is subject to economic uncertainty related to current economic and operating conditions including commodity prices, the ability to obtain equipment, services, supplies and personnel at favorable terms. The jurisdictions in which the Company operates represent a diverse and expanding market for current production and future product or service offerings. Upon expansion of EverGen to renewable energy sales, this same market is expected to provide an abundance of additional organic feedstock.

Ongoing weaknesses in the economy may expose EverGen to credit of governmental entities and municipalities and other major customers, which could negatively impact our financial performance.

The majority of revenues earned by NZWA and SSS are derived from long-term material contracts with municipalities located in proximity to the Company’s waste processing facilities. During the year ended December 31, 2020, NZWA had three customers who represented 46 percent of revenue (2019 – three customers represented 83 percent). During the year ended December 31, 2020, SSS had two customers who represented 72 percent of revenue (2019 – two customers represented 72 percent). These revenue contracts represent a significant portion of the current revenues reported by NZWA and SSS, and management does not consider there to be a concentration of risk associated with any one customer.

A material contract for both tipping and trucking of organic waste Metro Vancouver, a material contract held by the Company’s wholly-owned subsidiary SSS, submitted a request for proposal, specifically No. 20-016, related to organics management at the City of Vancouver’s North Shore Transfer Station. The request for proposal was for contracts expiring June 30, 2021, which are currently held by SSS for both tipping and trucking of organic waste at the Company’s facility near Whistler, British Columbia. These contracts accounted for 70 percent of the revenue generated by SSS during the year ended December 31, 2020. On April 16, 2021, the Company was notified that this material contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee. Management expects to replace this material contract with revenue from other municipal, commercial or residential sources, the specific timing of which is uncertain.

Contractual provisions are in place to safeguard EverGen in the event that this contract was not renewed or otherwise offset by new contracts. Under compensation provisions in EverGen’s purchase agreement

F-19

with the previous shareholders of SSS, this request for proposal outcome may prompt (i) the release to EverGen of $2,000 of performance driven holdbacks paid to the escrow agent in trust subsequent to December 31, 2020 and (ii) the release of encumbrances on the $319 of restricted cash held in restricted term deposits as well as the $447 collateralized accounts receivable at December 31, 2020, respectively, that are also subject to holdback performance obligations and escrow arrangements. The North Shore Transfer Station represents two of the 21 municipalities, less than 10 percent, included under the administration of Metro Vancouver. The remaining municipalities provide EverGen the opportunity for additional municipal contracts beyond or in addition to the North Shore Transfer Station contract.

EverGen is working in collaboration with local businesses and leading consumer driven businesses to advance socially conscious commerce under new business models targeted at organic waste recycling. These collaborations are part of EverGen’s diversification and extension strategies. These new business models aim to expand and capture additional sources of organic waste for recycling by motivating and fulfilling consumer-driven expectations of organic waste recycling. Accordingly, EverGen’s business model contains a significant expansion of organic waste sourcing from new participants and capture additional value beyond EverGen’s current sources of revenue.

EverGen’s operations are subject to environmental, health and safety laws and regulations. Compliance with existing and/or future regulations and/or enforcement of such regulations can restrict or change our operations, negatively affect our financial performance and a decrease in regulation may lower barriers of entry to competitors. Changes in regulations applicable to renewable fuel standards may significantly impact EverGen’s business strategy and concurrently our financial performance.

Many of the laws and regulations that EverGen is subject to fall under the United Nations Declaration of Rights of Indigenous People (“UNDRIP”) as recently enacted in British Columbia. UNDRIP emphasizes the rights of Indigenous people to live in dignity, to maintain and strengthen Indigenous institutions, cultures and traditions and to pursue self-determined development, in keeping with Indigenous needs and aspirations. UNDRIP includes the right to free, prior and informed consent for Indigenous people in several areas, including the resource development and by implication the regulations under which development and related operations occur. EverGen has a facility which operates on First Nation land, employs individuals from this same First Nation and relies on this First Nation for input into permitting and regulatory matters. EverGen is committed to working with First Nations and Indigenous people and upholding the highest standards of UNDRIP.

EverGen may be unable to obtain or maintain the required permits or expand existing permitted capacity of our organic waste facilities which may have a material adverse effect on our financial performance. In addition, EverGen may be subject to delays in receiving such permits.

The British Columbia Ministry of Environment and Climate Change Strategy (“MOE”) is the primary regulatory body responsible for the effective protection, management and conservation of water, land, air and living resources within the locations of EverGen’s operations and facilities. Through proactive engagement with the MOE, and with the input of its First Nation’s allies, the Company is collaborating to ensure compliance with current and prospective regulations. Through this process, the Company and the MOE are actively participating in ongoing discussions regarding forecasted expansion plans which include remedial and corrective changes to existing sites that were not in full compliance as of the date of acquisition and as of the date of this MD&A. To achieve full compliance, management has included an operating costs accrual for the Company as at and for the period ended December 31, 2020. EverGen has developed compliance procedures and guidelines to reduce the risk of future non-compliance.

The Company may require First Nations consultation to maintain existing locations and secure future locations for capital projects. There is no guarantee that these consultations will maintain existing contracts or provide the necessary approvals for EverGen to proceed with the Company’s intended development. Certain of the Company’s land leases are located on First Nations land and are subject to customary approvals and extensions.

F-20

EverGen is required to comply with health, safety and operating regulations at the Company’s facilities and operations, the failure of which could result in significant liability and/or fines and penalties. The failure of our employees, advisors and contractors to follow applicable procedures and guidelines may result in personal injury or property damage.

Operational risk relates to activities carried out with an entity, arising from structure, systems, people, products and/or processes that may cause changes or reduced to availability of resources, plant damage or component failure.

Direct and indirect losses may arise due to errors made by employees and consultants with regards to compliance with internal procedures and external regulations. These errors may be the result of errors in decisions, theft, misuse or insufficient competence and/or task specific qualifications. Operational risk is inherent is all business processes and systems and the effective management of this risk is fundamental to EverGen’s current and evolving risk management systems.

The Company is required to comply with environmental regulations relating to water, land, air and living resources primarily as regulated by the British Columbia MOE, the failure of which could result in significant liability and/or fines and penalties.

The EverGen business model is oriented around sustainability by improving the carbon and waste footprint of our customers and as such, we carefully consider our own environmental impact and behaviour. The collection, processing and storage of organic waste generates emissions through the consumption of fuel and electricity. Consistent with any business, EverGen faces environmental challenges and where possible EverGen strives to reduce environmental consequences.

In addition, there may be risks presented by the potential for subsurface heat reactions causing elevated organic waste temperatures and increased production of leachate, organic waste gas and odours.

There is currently no existing public market for the common shares of EverGen. The completion of a public offering may not lead to an active trading market, or if developed, a market that is sustainable. There is no guarantee of a return on investment in the common shares of EverGen and investors may lose their entire investment. The Company is unlikely to pay dividends for an extended period of time.

Equity securities are subject to trading and volatility risks which combined with various global financial conditions including the increased volatility of financial markets may reduce the price of the common shares of the Company and dilution from additional equity offerings may negatively impact holders of common shares. The sale of common shares by existing shareholders may adversely impact the share price.

A purchaser of shares under the initial public offering may purchase shares at a substantial premium to the current book value of the common shares. The failure of securities and industry analysts to publish research or to publish inaccurate or unfavourable research about the Company’s business may have a significant adverse impact on the price and trading volume of EverGen’s common shares.

The impact of any pending and future legal proceedings on EverGen’s business may have a material adverse impact on the Company’s financial positions, results of operations and cash flows. The Company may be subject to increased risk through securities class action litigation upon the public offering of shares in EverGen.

The cost of compliance with reporting requirements and the rules and regulations affecting public issues are significant. The completion of a successful public offering is not guaranteed.

F-21

EverGen is increasingly dependent on technology in our operations and if the technology fails, it could adversely impact the financial and operational performance of the Company. A cybersecurity incident including a breach of secure and private information could negatively impact our financial performance, subject us to criticism or affect our relationships with customers, employees, investors and other stakeholders.

If EverGen is unable to protect intellectual property or if a competitor develops or obtains exclusive rights to a breakthrough technology, the impact on our financial performance may be significant. Developments in technology could trigger a fundamental change in the organic waste processing and the renewable energy industries, which may adversely impact volumes at our organic waste management facilities and ultimately the Company’s financial performance.

Although EverGen obtains insurance to protect against certain risks, there are limitations on insurance coverage that may not be sufficient to cover the full extent of such costs, or a particular risk may not be insurable in all circumstances or the Company may elect not to obtain insurance in certain circumstances. A significant event that is not fully insured against could have a material adverse effect on EverGen’s financial position, results of operations and cash flows.

EverGen’s continued success depends on the performance of key employees, advisors and consultants. EverGen invests in training and workforce development with First Nations at its facility near Whistler, British Columbia. Failure to retain current, and recruit future employees and consultants, with the necessary skills could have a material adverse effect on the Company’s development and growth plans.

EverGen defines financial risk as the risk of loss or lost opportunity resulting from financial management and market conditions that could have a positive or negative impact on the Company’s cash flows.

Credit risk is the risk of loss if purchasers or counterparties default on their financial obligations. The maximum exposure of EverGen to credit risk at December 31, 2020 is limited to cash and cash equivalents and accounts receivable. The Company limits its exposure to credit loss by placing its cash and cash equivalents with high credit quality financial institutions and through the performance of credit checks for new customers. The Company considers its credit risk with respect to accounts receivable to be limited to the value of the provision for allowance for expected credit losses which has been recognized.

EverGen’s customers are primarily municipal governments. During the year ended December 31, 2020, NZWA had three customers who represented 46 percent of revenue (2019 – three customers represented 83 percent). During the year ended December 31, 2020, SSS had two customers who represented 72 percent of revenue (2019 – two customers who represented 72 percent). At December 31, 2020, two customers represented 31 percent of EverGen’s accounts receivable and accounts receivable includes $447 of which is collateralized.

Liquidity risk is the risk that EverGen will not be able to meet its financial liabilities as they come due. The Company monitors its liquidity requirements by anticipating operating, investing and financing activities and ensuring there are enough funds to cover these activities. Liquidity risks may necessitate the need for EverGen to conduct additional equity issues or obtain debt financing.

F-22

EverGen prepares annual capital expenditure and operating budgets and associated cash flow forecasts, which are monitored and updated as required. In addition, the Company requires authorizations for expenditures to assist with the management of capital.

The Company enters into leases and contracts that give rise to commitments in the normal course of business for future minimum payments. The Company had the following commitments at December 31, 2020:

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Lease liabilities(1)	417	417	386	375	315	3,290	5,200
Service contracts(2)	12	12	5	5	4	-	38

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In addition to the above amounts, the Company has annual commitments related to certain of its land leases for utilities and property taxes that fluctuate with usage and assessments, respectively.

Market risk is the risk that changes in market conditions, such as interest rates and foreign exchange rates will affect EverGen’s net income (loss) or value of financial instruments. At December 31, 2020, the Company has fixed interest rates associated with its lease liabilities, thereby substantially reducing the cash flow risk of market fluctuations related to interest rates. The Company has very few transactions denominated in foreign currencies thereby minimizing risk associated with fluctuations in exchange rates.

The preparation of financial statements requires management to make certain judgments, accounting estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses. A summary of EverGen’s critical accounting estimates and judgments can be found in note 2 and a summary of significant accounting policies can be found in note 3 to the audited consolidated financial statements for the period ended December 31, 2020.

EverGen’s management reviews its estimates frequently; however, the emergence of new information and changed circumstances may result in actual results or changes to estimated amounts that differ materially from current estimates. EverGen attempts to mitigate this risk by employing individuals with the appropriate skill set and knowledge to make reasonable estimates, developing internal control systems and comparing past estimates to actual results. The most significant accounting estimates, judgments and assumptions made in the preparation of the consolidated financial statements include fair value of assets acquired and liabilities assumed in a business combination, impairment, depreciation, lease liabilities and ROU assets, income taxes and share-based payments.

F-23

EverGen’s consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee.

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements include:

Amendments to IFRS 9 “ , IFRS 7 , IFRS 4 “ ” and IFRS 16 for the IASB
publication “Interest Rate Benchmark Reform”, which provides clarity on the changes after the reform of an interest rate benchmark. The amendments primarily relate to the modification of financial instruments, allowing for a practical expedient for modifications required by the reform.
International Accounting Standard 1 , (“IAS 1”) has been amended to clarify how to classify debt and other liabilities as either current or non-current. The amendment to IAS 1 is effective for the years beginning on or after January 1, 2023.

EverGen intends to adopt these standards and interpretations when they become effective and is currently assessing the impact of these amendments.

Management is responsible for the preparation and integrity of the Company’s financial statements, including the maintenance of appropriate information systems, procedures and internal controls, and to ensure that information used internally or disclosed externally, including the financial statements and MD&A, is complete and reliable. Disclosure controls and procedures should be designed to provide reasonable assurance that information required to be disclosed by the Company is recorded, processed, summarized and reported within the time periods specified under the Canadian securities law.

The Company’s Chief Executive Officer and Chief Financial Officer have concluded that a scope limitation exists for the periods presented in the financial statements and MD&A, as defined under National Instrument 52-109. EverGen’s acquisitions of NZWA and SSS occurred less than 365 days before the end of the financial period covered by the financial statements and MD&A, presented herein. As a result, management is unable to certify over the disclosure controls and procedures as of at and for the period ended December 31, 2020, or that they are effective and provide reasonable assurance that material information related to the Company is made known to them by others within EverGen.

The Company has commenced a process to standardize and strengthen pre-existing control systems at each of the acquired entities.

It should be noted that a control system, including EverGen’s disclosure and internal controls and procedures, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system will be met and it should not be expected that the disclosure and internal controls and procedures will prevent all errors or fraud.

F-24

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EverGen had the following related party transactions during the period ended December 31, 2020:

The fair value of compensation and other fees paid to the board of directors and members of executive management of EverGen for the period ended December 31, 2020 is as follows:

Share-based payment expense	1,202
Consultingfees included in transaction costs	256

The Company has the following amounts included in accounts receivable which are owing from related parties:

Net Zero Waste East Gate Ltd. 26

EverGen has the following amounts included in accounts payable and accrued liabilities which are owing to related parties:

1210366 BC Ltd.(1)	174
Dekany Consulting Inc.	256
Other	4

EverGen does not expect to have significant related party transactions outside of key management compensation going forward.

The fair value of compensation and other fees paid to the board of directors and members of executive management of NZWA is as follows:

Salaries and benefits	164	151
The exchange value of revenue earned from and expenses paid to related parties for NZWA is as follows:

Revenue	29	-
Expenses	22	-

Revenue earned from related parties during the year ended December 31, 20120 includes $29 for rental of equipment (2019 - $nil) to an entity in which a member of key management personnel is a shareholder and director.

F-25

Expenses paid to related parties during the year ended December 31, 2020 include $22 for equipment rentals (2019 - $nil) which are included in operating costs. The entity is related to NZWA due to a member of NZWA’s key management personnel being a director and controlling shareholder of the vendor providing the equipment rentals. During the year ended December 31, 2020, NZWA was reimbursed by an entity under common ownership for general and administrative expenses incurred by NZWA of $36 (2019 - $26).

The fair value of compensation and other fees paid to the board of directors and members of executive management of SSS is as follows:

Salaries and benefits 462 260

SSS had no revenue earned from related parties during the year ended December 31, 2020 (2019 - $nil). The exchange value of expenses paid to related parties of SSS is as follows:

Expenses 770 689

Expenses paid to related parties of SSS during the year ended December 31, 2020 include $763 for trucking services (2019 - $683) which are included in cost of goods sold. The entity is related to SSS due to a member of SSS’s key management personnel being a director and controlling shareholder of the vendor providing the trucking services. Other expenses of $7K were paid to related parties during the year ended December 31, 2020 (2019 - $6). During the year ended December 31, 2020, SSS reimbursed an entity under common ownership for general and administrative expenses incurred on behalf of SSS of $36 (2019 - $26).

On January 12, 2021, EverGen completed a non-brokered private placement of 254,000 common shares for gross proceeds of $1,270.

On January 26, 2021, EverGen completed a non-brokered private placement of 5,000 common shares for gross proceeds of $25 and on February 23, 2021 completed an additional non-brokered private placement of 5,000 common shares for gross proceeds of $25.

On March 15, 2021, Jennifer Schilling, was appointed Chief Financial Officer of EverGen.

The credit facility agreement is subject to the following covenants:

Maintain a consolidated working capital ratio equal to or greater than 1.20:1 at all times;
Maintain a consolidated “fixed charge coverage ratio” as defined in the agreement equal to or greater than 1.20:1 at all times, tested quarterly on a rolling four quarters basis;
Maintain a consolidated “total funded debt to EBITDA ratio” as defined in the agreement equal to or less 3.00 at all times, tested quarterly on a rolling four quarters basis and to be stepped down to 2.50 starting in fiscal 2022; and
Other operational and financial covenants including but not limited to the Company’s ability to pay dividends, incur additional debt, directly or indirectly grant loans or make investments and other such matters.

F-26

On March 18, 2021, the Company adopted an equity incentive plan which provides for the granting of stock options, restricted share units and deferred share units. In addition, on March 18, 2021, the Company granted (i) 195,000 Options to officers, an employee and consultants of the Company; (ii) 17,500 restricted share units to an officer and consultants of the Company and (iii) 27,500 deferred share units to its directors.

The Company, through its wholly-owned subsidiary SSS, submitted a request for proposal, specifically No. 20-016, for the City of Vancouver’s North Shore Transfer Station five-year contract related to organics management. The request for proposal was for contracts expiring June 30, 2021, currently held by SSS for both tipping and trucking of organic waste. During the three months ended March 31, 2021, these contracts accounted for 31 percent of EverGen’s revenue (year ended December 31, 2020, these contracts accounted for 70 percent of SSS’s revenue). On April 16, 2021, the Company was notified that this material contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee. Contractual provisions are in place to safeguard EverGen in the event that this contract was not renewed or otherwise offset by new contracts. Under compensation provisions in EverGen’s purchase agreement with the previous shareholders of SSS, this request for proposal outcome may prompt (i) the release to EverGen of $2,000 of performance driven holdbacks paid to the escrow agent in trust subsequent to December 31, 2020 and (ii) the release of encumbrances on the $319 of restricted cash held in restricted term deposits as well as the $447 collateralized accounts receivable at December 31, 2020, respectively, that are also subject to holdback performance obligations and escrow arrangements. In addition, this outcome may also prompt the derecognition of contingent consideration included in the purchase price at December 31, 2020 related to performance obligations.

Effective April 16, 2021, EverGen acquired all of the issued and outstanding shares of Fraser Valley Biogas Ltd. (“FVB”), pursuant to a share purchase agreement dated April 16, 2021 among EverGen and Heppells Potato Corporation and Pela Holdings Ltd. The Company paid an aggregate amount of $11,500 comprised of $10,500 cash consideration and issued 125,000 common shares valued at $8.00 per share. FVB owns and operates a biogas facility in Abbotsford, British Columbia which sells RNG under a long-term contract with Fortis BC. EverGen used a portion of the net proceeds from the March 18, 2021 Special Warrant Financing and funds from the March 17, 2021 credit facility to fund the acquisition of FVB.

On April 27, 2021, EverGen completed a non-brokered private placement of 111,111 common shares at a price of $9.00 per common share for gross proceeds of $1,000.

On April 28, 2021, the Company filed a preliminary prospectus with the intention of completing an initial public offering.

On April 29, 2021, EverGen’s wholly owned subsidiary Net Zero Waste Abbotsford Inc. entered into a 20year offtake agreement with FortisBC Energy Inc. (Fortis BC). Under the agreement, FortisBC will purchase up to 173,000 gigajoules of RNG annually for injection into its natural gas system, upon completion of an anaerobic digester project at EverGen’s existing Net Zero Waste Abbotsford composting and organic processing facility in Abbotsford, British Columbia. Once approved by the British Columbia Utilities Commission and other regulatory agencies, the project would convert municipal and commercial organic waste into energy to meet the needs of approximately 1,900 residential homes.

F-27

On May 7, 2021, the Company received $375 of the $447 portion of the Organic Infrastructure Program grant recorded in accounts receivable at March 31, 2021. The payment received is held as restricted cash.

On June 29, 2021, the Company granted 100,000 restricted share units to an officer of the Company.

Additional information related to EverGen is available on SEDAR at www.sedar.com.

EverGen, NZWA and SSS uses certain financial measures referred to in this MD&A to quantify its results that are not prescribed by International Financial Report Standards (“IFRS”). The following terms: “EBITDA”, “adjusted EBITDA”, “operating profit” and “working capital” are not recognized measures under IFRS and may not be comparable to that reported by other companies. EverGen believes that, in addition to measures prepared in accordance with IFRS, the non-GAAP measurements provide useful information to evaluate the Company’s, NZWA’s and SSS’ performance and ability to generate cash, profitability and meet financial commitments.

These non-GAAP measures ae intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Management considers EBITDA and adjusted EBITDA key metrics in analyzing operational performance and the Company’s, NZWA’s and SSS’ ability to generate cash flow. EBITDA is measured as net income (loss) before interest, tax, depreciation and amortization. Adjusted EBITDA is measured as EBITDA adjusted for share-based payment expense and unusual or non-recurring items.

The following table provides a reconciliation of the non-GAAP measures, EBITDA and adjusted EBITDA, to the applicable IFRS measure for EverGen:

Net income (loss)	Net income (loss)	(2,233)
Tax expense	(recovery)	(288)
Share-based	payment expense	1,452
Non-recurringitems		1,069

Non-recurring items for EverGen consist of transaction costs and one-time professional fees related to initial incorporation and integration of acquisitions included in general and administrative expenses and incurred during the period from incorporation to December 31, 2020.

F-28

The following table provides a reconciliation of the non-GAAP measures, EBITDA and adjusted EBITDA, a to the applicable IFRS measurement for NZWA:

Net income Tax expense Depreciation Finance costs(income),net	1,094	746 201 319 154
	366 408 195
Non-recurringitems	217	549

Non-recurring items for NZWA during 2020 consist primarily of one-time costs related to compliance and certain consulting fees, partially offset by insurance proceeds and debt forgiveness. Non-reoccurring items for NZWA during 2019 consist of fees for permitted third-party processing of organic waste processing and professional fees that are not considered reoccurring.

The following table provides a reconciliation of the non-GAAP measures of, EBITDA and adjusted EBITDA, to the applicable IFRS measurement for SSS:

Net income Tax expense Depreciation Finance costs(income),net	796	1,529 445 239 128
	249 319 113
Non-recurringitems		27
	546

Non-recurring items for SSS during 2020 consist of one-time costs related to compliance and certain consulting fees, offset by debt forgiveness and a gain on debt extinguishment which is not considered reoccurring. Non-reoccurring items for SSS during 2019 include certain professional fees.

Management considers operating profit a key metric in analyzing operational efficiency and performance and the Company’s, NZWA’s and SSS’ ability to generate cash flow. Operating profit is measured as gross profit, an additional subtotal found in the statements of net income, less operating costs and general and administrative expenses.

The following table provides a reconciliation of operating profit, a non-GAAP measure to the applicable IFRS measurement for NZWA:

Gross profit Operating costs General and administrative expenses	Gross profit Operating costs General and administrative expenses	2,986	2,054 389 281
		737 315

F-29

The following table provides a reconciliation of operating profit, a non-GAAP measure to the applicable IFRS measurement for SSS:

		3,029	3,029
		1,100 510

Working capital for EverGen is calculated as current assets of $6,979 less current liabilities of $9,821 as of December 31, 2020. EverGen had a working capital deficit of $2,842 at December 31, 2020. The Company expects to eliminate the working capital deficit with the gross proceeds from equity and debt financings completed subsequent to December 31, 2020.

F-30

Certain statements in this MD&A constitute forward-looking statements and forward-looking information (collectively “forward-looking statements”) within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forwardlooking information is often, but not always, identified by the use of words such as: “anticipates”, “believes”, “continues”, “estimates”, “could”, “expects”, “intends”, “may”, “objective”, “ongoing”, “plans”, “will”, “projects”, “should”, or similar expressions suggesting future outcomes or events. In particular, this MD&A contains forward-looking statements relating, but not limited to:

EverGen’s plans to develop and construct a platform of sustainable infrastructure, produce RNG and reduce carbon emissions;
Optimization and expansion of organic waste processing facilities and RNG feedstock;
Cost savings through synergies and efficiencies expected to be realized from the acquisitions of NZWA and SSS;
Continued growth through strategic acquisitions and consolidation opportunities;
Management’s expectations of replacing the Metro Vancouver material contract that was awarded to another bidder subsequent to December 31, 2020; and
The establishment and realization of a circular economy through the Company’s organic waste management facilities and the expansion and development of renewable energy.

Such statements are based on assumptions of future events and actual results could vary from these assumptions. Events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties and other factors, many of which are beyond the control of EverGen. These include, but are not limited to, risks associated with renewable energy sources, such as market competition, volatility of prices, currency fluctuations, environmental risk, and competition from other producers and ability to access sufficient capital from internal and external sources.

Although management believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be accurate, as results and future events could differ materially from those expected or estimated in such statements. As such, readers are cautioned not to place undue reliance on these forward-looking statements. The forwardlooking statements contained in this MD&A are made as of the date hereof for the purposes of providing the readers with EverGen’s expectations for the coming year. The forward-looking statements and information may not be appropriate for other purposes. Furthermore, the Company undertakes no obligation to update or revise these forward-looking statements or information as a result of new information or future events, other than as required by applicable securities laws. However, in the event that subsequent events are reasonably likely to cause actual results to differ materially from forwardlooking statements previously disclosed by the Company for a period that is not yet complete, EverGen will provide disclosure on such events and the anticipated impact of such events.

F-31

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Independent auditor’s report

To the Board of Directors of EverGen Infrastructure Corporation

Our opinion

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of EverGen Infrastructure Corporation and its subsidiaries (together, the Company) as at December 31, 2020 and its financial performance and its cash flows for the period of incorporation from May 13, 2020 to December 31, 2020 in accordance with International Financial Reporting Standards (IFRS).

What we have audited

The Company’s consolidated financial statements comprise:

the consolidated statement of financial position as at December 31, 2020;
the consolidated statement of net income (loss) and comprehensive income (loss) for the period then ended;
the consolidated statement of changes in shareholders’ equity for the period then ended;
the consolidated statement of cash flows for the period then ended; and
the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the consolidated financial statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada. We have fulfilled our other ethical responsibilities in accordance with these requirements.

PricewaterhouseCoopers LLP 111-5th Avenue SW, Suite 3100, Calgary, Alberta, Canada T2P 5L3 T: +1 403 509 7500, F: +1 403 781 1825

“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

F-32

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Other information

Management is responsible for the other information. The other information comprises the Management’s Discussion and Analysis.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditor’s responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

F-33

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As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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Chartered Professional Accountants

Calgary, Alberta July 5, 2021

F-34

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cash equivalents 5 4,684 d cash 5 319 s receivable 6 1,515 expenses and other assets 112 es 127 mission credits 4 222	cash equivalents 5 4,684 d cash 5 319 s receivable 6 1,515 expenses and other assets 112 es 127 mission credits 4 222	cash equivalents 5 4,684 d cash 5 319 s receivable 6 1,515 expenses and other assets 112 es 127 mission credits 4 222	cash equivalents 5 4,684 d cash 5 319 s receivable 6 1,515 expenses and other assets 112 es 127 mission credits 4 222
d equipment 7 11,597 ssets 8 20,960 9 10,974

s payable and accrued liabilities 10 3,941 bilities 12 225 nt consideration 4 5,655
ies 12 3,229 x 15 5,551


l 13 32,790 nts 13 1,068 13 32 surplus 13 252 d deficit (2,233)

The notes are an integral part of these consolidated financial statements. Commitments 20 Subsequent events 21

Signed Signed

Chase Edgelow, Director

Mary Hemmingsen, Director

F-35

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General and administrative expenses 14 328 Share-based payment expenses 13 1,452 Transaction costs 4 741	General and administrative expenses 14 328 Share-based payment expenses 13 1,452 Transaction costs 4 741
Tax expense(recovery) 15 (288)

	16

The notes are an integral part of these consolidated financial statements.

F-36

Balance, May 13, 2020 - Common shares issued to Founders on conversion of convertible notes 11,13 600 Common shares issued to Additional Founders 13 700 Common shares issued on private placements 13 29,883 Common shares issued in exchange for advisor services 13 210 Common shares issued as consideration for acquisitions 4,13 3,889 Share issue costs,net of tax 13 (2,492)	Balance, May 13, 2020 - Common shares issued to Founders on conversion of convertible notes 11,13 600 Common shares issued to Additional Founders 13 700 Common shares issued on private placements 13 29,883 Common shares issued in exchange for advisor services 13 210 Common shares issued as consideration for acquisitions 4,13 3,889 Share issue costs,net of tax 13 (2,492)	Balance, May 13, 2020 - Common shares issued to Founders on conversion of convertible notes 11,13 600 Common shares issued to Additional Founders 13 700 Common shares issued on private placements 13 29,883 Common shares issued in exchange for advisor services 13 210 Common shares issued as consideration for acquisitions 4,13 3,889 Share issue costs,net of tax 13 (2,492)	Balance, May 13, 2020 - Common shares issued to Founders on conversion of convertible notes 11,13 600 Common shares issued to Additional Founders 13 700 Common shares issued on private placements 13 29,883 Common shares issued in exchange for advisor services 13 210 Common shares issued as consideration for acquisitions 4,13 3,889 Share issue costs,net of tax 13 (2,492)
Balance, May 13, 2020 Share warrants issued for advisor and brokers services onprivateplacements 13 1,068

Balance, May 13, 2020 Share rights issued onprivateplacement 13 32

Balance, May 13, 2020 - Share-based payments 13 1,452 Share-based payments of common shares issued to Founders on conversion of convertible notes 11,13 (500) Share-based payments of common shares issued to Additional Founders 13 (700)

Balance, May 13, 2020 - Total comprehensive loss (2,233)

The notes are an integral part of these consolidated financial statements.

F-37

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----- Start of picture text -----

Net income (loss) (2,233)
Items not affecting cash:
Share-based payment expenses 13 1,452
Deferred income tax expense (recovery) 15 (288)
Changes in non-cash working capital 19 1,023
Acquisitions 4 (24,498)
Cash, cash equivalents and restricted cash included in
4
acquisitions 971
Proceeds from non-brokered private placement 13 6,830
Proceeds from brokered private placement 13 23,085
Share issue costs 13 (1,663)
Funds advanced by Founders and exchanged for convertible
notes and subsequently converted to common shares 11 100
Changes in non-cash working capital 19 224
5,003
Cash and cash equivalents at May 13, 2020 -
5
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The notes are an integral part of these consolidated financial statements.

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EverGen Infrastructure Corp. (“EverGen” or the “Company”) operates two Gore Cover™ organic waste management facilities in British Columbia. The Company processes organics, yard waste and biosolids for a contracted tipping fee and produces high-quality organic compost and soils for farmers, gardeners and developers as part of its outbound business. EverGen plans to develop anaerobic digestion infrastructure and eventually sell renewable natural gas (“RNG”). On December 31, 2020, the Company completed a plan of arrangement (the “Arrangement”) with Net Zero Waste Abbotsford Ind. (“NZWA”) and Sea to Sky Soils and Composting Inc. (“SSS”) whereby all the issued and outstanding shares of NZWA and all the issued and outstanding shares of SSS were acquired by EverGen. These transactions were accounted for as business combinations.

EverGen was incorporated under the on May 13, 2020.

The Company’s principal place of business is located at #600 - 1111 W Hastings Street Vancouver, British Columbia and its registered office is located at 1200 Waterfront Centre, 200 Burrard Street Vancouver, British Columbia.

The Company’s revenue, costs of goods sold and certain operating costs are impacted by seasonal weather variation and the related fluctuations in volumes processed.

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These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee.

The policies applied in these consolidated financial statements are based on IFRS issued, effective and outstanding as of December 31, 2020. These consolidated financial statements were approved and authorized for issuance by EverGen’s board of directors on July 5, 2021.

The Company’s opening balance sheet consisted of a nominal amount of cash and common shares (see note 13).

These financial statements are presented in Canadian dollars, EverGen’s functional currency, unless otherwise indicated.

These financial statements have been prepared on a historical cost basis, except as detailed in the Company’s accounting policies disclosed in note 3.

EverGen manages its business on the basis of one operating and reportable segment.

The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. These estimates and judgments are based on management’s best understanding of current events and actions that EverGen may undertake in the future. Actual results may differ from these estimates and judgments. Estimates and their underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which estimates are revised and for any future years affected.

Significant estimates and judgments used in the preparation of these financial statements are outlined below.

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The fair value of assets acquired and liabilities assumed in a business combination, including contingent consideration and goodwill, is estimated based on information available at the date of the acquisition. Estimates are used to determine the fair value of the acquired assets and assumed liabilities and include quoted market prices and widely accepted valuation techniques.

Property and equipment and intangible assets are tested for impairment when events or changes in circumstances indicate that the carrying amount exceeds the recoverable amount. Goodwill is tested for impairment at least annually.

For the purposes of impairment testing, assets are grouped at the lowest levels of integrated assets that generate identifiable cash inflows and that are largely independent of the cash inflows of other assets or groups of assets. These assets are allocated into a cash-generating unit (“CGU”). The allocation of assets into a CGU requires significant judgment and interpretations with respect to the integration between assets, the existence of active markets, similar exposure to market risks, shared infrastructures and the way in which management monitors the performance of the assets.

The recoverable amount of a CGU is determined as the greater of fair value less costs of disposal (“FVLCD”) or value-in-use (“VIU”). These calculations require the use of estimates applied by management regarding forecasted activity levels, expected future results and discount rates among others. These estimates are subject to change as new information becomes available. Changes in assumptions used in determining the recoverable amount could have a material effect on the carrying value of the related assets and CGU.

Depreciation of EverGen’s property and equipment incorporates estimates of useful lives and residual values. These estimates may change as more knowledge is obtained or as general market conditions change or as technological advancements are made.

Management applies judgment in reviewing each of its contractual arrangements to determine whether the arrangement contains a lease. The measurement of lease liabilities and right-of-use (“ROU”) assets incorporates an estimate of lease terms and discount rates. The term of a lease is determined as the noncancellable period of a lease and includes periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option. In considering the option to extend a lease, EverGen considers all the relevant facts and circumstances that create an economic incentive to exercise or not exercise the option. The assessment is reviewed if a significant change in circumstances occurs which affects this assessment. Where the rate implicit in a lease is not readily determinable, the discount rate is estimated using a discount rate similar to the Company’s incremental borrowing rate to purchase an asset of similar value, with similar payment terms and security.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement amounts of existing assets and liabilities and their respective tax basis. Estimates of the EverGen’s future taxable income are considered in assessing the utilization of available tax losses. The calculation of income taxes involves many complex factors including the interpretation of relevant tax legislation and an analysis of the amount of future taxable profits.

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Compensation costs recorded pursuant to share-based compensation and payment plans are subject to estimated fair values which are based on significant assumptions such as risk-free interest rates, volatility and anticipated dividends.

The fair value of the convertible debt is subject to estimated fair values which are based on significant assumptions such as risk-free rates and volatility.

In March 2020, the World Health Organization declared a global pandemic due to Novel Coronavirus (“COVID-19”). COVID-19 has significantly impacted the global economy. The full extent and impact of the COVID-19 pandemic to EverGen’s operations and future financial performance is unknown at this time and depends on a number of future developments which are uncertain and unpredictable. These future developments include the duration and spread of COVID-19, its continued impact on capital and financial markets and new information that may emerge concerning the severity of the virus. These uncertainties may continue beyond the determination of how to contain the virus and treatment of those impacted. The ongoing pandemic presents uncertainty and risk to EverGen, its performance, and the estimates and assumptions used by management to prepare its financial results.

The accounting policies set out below have been applied consistently by EverGen for all periods presented in these financial statements.

The consolidated financial statements include the accounts of EverGen and its subsidiaries. Subsidiaries are entities over which EverGen has control. Subsidiaries are consolidated from the date of acquisition of control and continue to be consolidated until the date that there is a loss of control. All intercompany transactions, balances, and unrealized gains and losses from intercompany transactions are eliminated on consolidation.

Business combinations are accounted for using the acquisition method, where the identifiable assets acquired and liabilities assumed are recognized and measured at their fair value at the date of acquisition, with the exception of income taxes, lease liabilities and ROU assets. Any excess of the purchase price over the value of the net assets acquired is recognized as goodwill and any deficiency of the purchase price over the value of the net assets acquired is recorded as a gain in net earnings. At acquisition, goodwill is allocated to each of the CGUs to which it relates. Subsequent measurement of goodwill is at cost less any accumulated impairment losses. Associated transaction costs are expensed when incurred.

Contingent consideration transferred in a business combination is measured at fair value on the date of acquisition and classified as a financial liability or equity. Contingent consideration classified as a liability is re-measured at fair value at each reporting period, with changes in fair value recognized in net earnings. Payments are classified as cash used in investing activities until the cumulative payments exceed the acquisition date fair value of the liability. Cumulative payments in excess of the acquisition date fair value are classified as cash used in operating activities.

Revenue is generated primarily from tipping fees charged to customers upon receipt of organic waste at the Company’s organic waste facilities and through the sale of organic compost and soil. Revenues are

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influenced by various factors such as the type and weight or volume of waste materials disposed of at EverGen’s facilities.

Recognition of revenue from tipping fees occurs based on individual contractual terms and when indicators of the transfer of control exist, which is generally satisfied when the services are completed in accordance with the contract specifications. Revenue earned from the rendering of services and earned at a point in time relates to includes tipping fees on organic waste disposal and trucking services.

Revenue from the sale of organic compost and soil is recognized when transfer of control exists, primarily at the transfer of finished goods inventory to the customer.

EverGen’s revenue transactions do not contain significant financing components and payments are typically due within 30 days of revenue recognition. The Company does not have contracts where the period between the transfer of the promised goods or services to the customer and payments by the customer exceeds one year. As such, no adjustments are made to the transaction prices for the time value of money. The Company does not disclose information about remaining performance obligations that have an original expected duration of one year or less and it does not have any long-term contracts with unfulfilled performance obligations.

Finance income is recognized as it accrues using the effective interest rate method.

Operating costs are comprised of repairs and maintenance, utilities, licenses and permits and property taxes.

General and administrative expenses consist of labour and related benefits costs, which includes salaries, bonuses and other related payroll benefits; professional fees, which includes fees for consulting, legal, audit and tax services; and other general and administrative expenses.

Government grants are recognized when there is reasonable assurance that the grant will be received and all conditions associated with the grant are met. Grants related to assets are recorded as deferred income and amortized into other income over the useful life of the underlying asset. Claims under government grant programs related to the recovery of expenses are recorded as a reduction of the eligible expenses. Government grants in which there are no corresponding assets or expenses are recorded in other income in net income (loss) in the period in which the reasonable assurance and conditions of the grants have been met.

Finance costs consist of the interest component of lease payments and interest recognized on loans which is expensed as incurred.

Cash consists of cash on deposit, short-term highly liquid interest-bearing investments that are readily convertible into cash with a remaining term to maturity of 90 days or less when acquired. Restricted cash is disclosed separately.

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Inventory consists of raw materials, work in progress, and finished goods. Inventory consists of organic and green waste products (“organic feedstock”), compost and soil which is at various stages of decomposition (“work-in-progress”), and various grades of saleable branded compost and soil (“finished goods”).

Inventory is measured at the lower of cost and net realizable value. The cost of inventory is based on the weighted average principle and includes expenditures incurred in acquiring the raw materials, processing or conversion costs, and other costs incurred in producing saleable compost and soil. In the case of work in progress, cost includes an appropriate share of these costs based on its stage of completion. Net realizable value is the estimated selling price less applicable selling costs.

Property and equipment has been measured at cost less accumulated depreciation and impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the assets and subsequent expenditures to the extent that they can be measured, and future economic benefit is probable. Repairs and maintenance are expensed as incurred.

Management estimates the useful life and salvage value of property and equipment based on expected utilization and expected life. Residual values, methods of depreciation and useful lives are reviewed annually and if necessary, changes are accounted for prospectively.

Buildings, leasehold improvements, equipment, vehicles and other are depreciated on a straight-line basis over their estimated useful economic lives. ROU assets are depreciated on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term. The following useful lives are utilized for each determining depreciation:

termining depreciation:

ngs and leasehold improvements ment, vehicles and other -of-use assets	15 – 25 years 10 – 15 years 2 – 19years

Depreciation of an asset begins when it is available for use and ceases at the earlier of the date an asset becomes fully depreciated, is derecognized or is classified as available for sale. Depreciation does not cease when an asset becomes idle.

The carrying amount of an asset is derecognized when the asset is disposed of or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss from derecognition of the asset is included in the calculation of net income (loss) in the period the item is derecognized. The gain or loss is calculated as the difference between the net disposal proceeds and the carrying amount of the item.

EverGen assesses whether a contract is a lease; based on whether the contract conveys the right to control the use of an underlying asset for a period of time in exchange for consideration. EverGen allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices.

Leases are recognized as a ROU asset and a corresponding lease liability at the date on which the leased asset is available for use by EverGen. Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of fixed payments, variable lease payments that are based on an index or a rate, amounts expected to be paid by the lessee under residual value guarantees, the exercise price of purchase options if the lessee is reasonably certain to exercise that option, and payments of penalties for terminating the lease, less any lease incentives receivable. These payments are discounted using EverGen’s incremental borrowing rate when the rate implicit in the lease is not readily available. The Company uses a single discount rate for a portfolio of leases with reasonably similar characteristics.

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Lease payments are allocated between the liability and finance costs. The finance cost is charged to net income (loss) over the lease term.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in the future lease payments arising from a change in an index or rate, if there is a change in the amount expected to be payable under a residual value guarantee or if there is a change in the assessment of whether EverGen will exercise a purchase, extension or termination option that is within the control of EverGen. When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the ROU asset or is recorded in net income (loss) if the carrying amount of the ROU asset has been reduced to zero.

The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability; initial direct costs incurred; and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset; less any lease payments made at or before the commencement date. The ROU asset may be adjusted for certain remeasurements of the lease liability and impairment losses.

Leases that have a term of less than twelve months or leases on which the underlying asset is of low value are recognized as an expense in net income (loss) over the lease term.

A lease modification will be accounted for as a separate lease if the modification increases the scope of the lease and if the consideration for the lease increases by an amount commensurate with the standalone price for the increase in scope. For a modification that is not a separate lease or where the increase in consideration is not commensurate, at the effective date of the lease modification, the Company will remeasure the lease liability using EverGen’s incremental borrowing rate, when the rate implicit to the lease is not readily available, with a corresponding adjustment to the ROU asset. A modification that decreases the scope of the lease will be accounted for by decreasing the carrying amount of the ROU asset, and recognizing a gain or loss in net income (loss) that reflects the proportionate decrease in scope.

Intangible assets are measured at cost less accumulated amortization and impairment losses. Cost includes the purchase price to acquire an asset or costs directly attributable to the internal generation of an asset. Internally generated intangible assets arising from development activities involving a plan or design for new or substantially improved products and processes are capitalized only if the development costs can be reliably measured, the product or process is technically and commercially feasible, future economic benefits are probable, and EverGen’s has the intention and sufficient resources to complete development and use or sell the assets.

Intangible assets acquired as part of a business combination are capitalized separately from goodwill if the asset is separable or arises from contractual or legal rights, and the fair value can be measured reliability on initial recognition. Expenditures on research activities undertaken with the prospect of gaining technical knowledge are expensed as incurred.

Intangible assets are depreciated on a straight-line basis over their estimated useful lives. Intangible assets with an indefinite useful life are not depreciated. The following useful lives are utilized for each determining depreciation:


Brands Customer contracts and stakeholder relationships		20 years 2 – 25years

Property and equipment and intangible assets are reviewed separately for indicators of impairment at each reporting period or when facts and circumstances suggest that the carrying amount may exceed its recoverable amount. Such indicators include but are not limited to changes in EverGen’s business plans, economic performance of the assets, changes in activity levels, an increase in the discount rate or evidence of physical damage or obsolescence.

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If indicators of impairment exist, the recoverable amount of the CGU is estimated as the greater of VIU and FVLCD. VIU is estimated as the present value of the future cash flows expected to arise from the continuing use of a CGU or an asset. In determining FVLCD, recent market transactions are considered, if available. In the absence of such transactions, an appropriate valuation model is used.

If the recoverable amount is less than the carrying amount, an impairment loss is recognized immediately in net income (loss).

Impairment losses, other than goodwill, recognized in prior periods are assessed at each reporting date for any indicators that the impairment losses may no longer exist or may have decreased. In the event that an impairment loss reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the carrying amount does not exceed the amount that would have been determined had no impairment loss been recognized on the asset in prior periods. The amount of the reversal is recognized in net income (loss).

Goodwill is tested for impairment at least annually or as events occur that could result impairment. Goodwill is tested for impairment at an operating segment level by comparing the carrying amounts of the operating segment’s assets, property and equipment, ROU assets and goodwill, and comparing the recoverable amount. The recoverable amount of the operating segment is estimated as the greater of VIU and FVLCD. VIU is estimated as the present value of the future cash flows expected to arise from the continuing use of the underlying assets. In determining FVLCD, recent market transactions are considered, if available. In the absence of such transactions, an appropriate valuation model is used.

If the recoverable amount is less than the carrying amount, an impairment loss is recognized immediately in net income (loss). Goodwill impairments are not reversed.

Notes issued with a convertible feature are valued at the fair value of the conversion feature using a BlackScholes model with the difference between cash proceeds and fair value recorded in equity.

A provision is recognized if, as a result of a past event, EverGen has a present obligation, legal or constructive, that can be estimated reliably, and it is more likely than not that an outflow of economic benefits will be required to settle the obligation. Where applicable, the future cash flow estimates are adjusted to reflect risks specific to the liability.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects the current market assessments of the time value of money. Where discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

A contingent liability is disclosed where the existence of an obligation will only be confirmed by future events or where the amount of the obligation cannot be measured reliably, and outflow of cash is less than remote. Contingent assets are not recognized but are disclosed when an inflow of economic benefits is probable.

Income tax comprises current and deferred tax. Income tax is recognized in the statement of comprehensive income except to the extent that it relates to items recognized directly in equity, in which case the income tax is also recognized directly in equity or in other comprehensive income.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted, or substantially enacted, at the end of the reporting period, and any adjustment to tax payable in respect of previous years. Taxable income differs from net income (loss) as it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible.

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Deferred tax is recognized in respect of temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is determined on a non-discounted basis using tax rates and laws that have been enacted or substantively enacted at the balance sheet date and are expected to apply when the deferred tax asset or liability is settled. Deferred tax assets are recognized to the extent that it is probable that the future taxable profits will be available against which they can be utilized. The carrying amount of a deferred tax asset is reviewed at the end of each reporting period. EverGen reduces the carrying amount of a deferred tax asset to the extent that it is no longer probable that sufficient taxable income will be available to allow the benefit of part or all of these deferred tax assets to be utilized.

Common shares are classified as equity. Incremental costs directly attributable to the issuance of shares or options are recognized as a deduction from equity.

EverGen has equity-settled incentive programs for the granting of additional shares. EverGen follows the fair value method of valuing share-based compensation instruments. Under this method, compensation cost is measured at the fair value of the date of grant and expensed over the vesting period with a corresponding increase to contributed surplus. Upon the exercise of an instrument, consideration paid together with the amount previously recognized in contributed surplus is recorded as an increase to share capital. The fair value of each tranche within an award is measured at the date of the grant using the BlackScholes option pricing model.

Basic income (loss) per share is calculated by dividing net income (loss) attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted income (loss) per share is determined by adjusting the net income (loss) attributable to common shareholders and the weighted average number of common shares outstanding for the effects of dilutive potential common shares which comprise performance share units (“PSUs”) and warrants and rights under the shareholder rights plan. The calculation assumes that the proceeds on exercise of the PSUs, warrants or shareholders rights are used to repurchase shares at the average market price during the period. Should the Company have a loss in a period, PSUs, warrants and shareholder rights would be anti-dilutive and are excluded from the determination of fully diluted loss per share.

Transactions denominated in foreign currencies are translated into Canadian dollars at exchange rates prevailing at the transaction dates. Monetary assets and liabilities are translated into Canadian dollars at the rates prevailing on the reporting date. Non-monetary assets and liabilities are translated into Canadian dollars at the rates prevailing on the transaction dates. Foreign exchange gains and losses are recorded in net income (loss) in the period in which they occur.

EverGen’s financial assets consist of cash and cash equivalents, accounts receivable and carbon emission credits. EverGen’s financial liabilities consist of accounts payable and accrued liabilities, contingent payments and lease liabilities.

Financial instruments are recognized when EverGen becomes a party to the contractual provisions of the instrument. Financial instruments are recognized at fair value on initial recognition less transaction costs directly attributable to the acquisition or issuance of the financial instrument. Measurement in subsequent periods depends on the purpose for which the instruments were acquired. Financial assets are subsequently measured at amortized cost, fair value through other comprehensive income (“FVOCI”) or fair value through profit or loss (“FVTPL”) on the basis of EverGen’s business model and contractual cash

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flows of the financial asset. Financial liabilities are subsequently measured at amortized cost or FVTPL. Amortized cost is calculated by taking into account any issue costs. Interest expense is recognized in net earnings.

The Company characterizes its fair value measurements into a three-level hierarchy depending on the degree to which the inputs are observable as follows:

Level 1 inputs are quoted prices in active markets for identical assets and liabilities;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.

A financial asset is derecognized when the rights to receive cash flows from the asset have expired or have been transferred and EverGen has transferred substantially all the risks and rewards of ownership.

EverGen recognizes loss allowances for ECLs on its financial assets measured at amortized cost. Due to the nature of its financial assets, EverGen measures loss allowances at an amount equal to expected lifetime ECLs. Lifetime ECLs are the anticipated ECLs that result from all possible default events over the expected life of a financial asset. ECLs are a probability-weighted estimate of credit losses. Management uses a provision matrix based upon historical default rates and forward-looking assumptions to calculate expected credit losses and establish a provision for ECL. The Company’s historical bad debt expense has not been significant and is typically limited to specific customer circumstances. Management considers the credit worthiness and past payment history as well as any past due amounts in determining ECLs. Management’s assumptions are updated and adjusted at each reporting date. Credit losses are measured as the present value of all cash shortfalls, i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that EverGen expects to receive. ECLs are discounted at the effective interest rate of the related financial asset. The Company does not have any financial assets that contain a financing component.

A financial liability is derecognized when the obligation is discharged, cancelled or expired. When an existing financial liability is replaced by another from the same counterparty with substantially different terms, or the terms of an existing liability are substantially modified, it is treated as a derecognition of the original liability and the recognition of a new liability. When the terms of an existing financial liability are altered, but the changes are considered non-substantial, it is accounted for as a modification to the existing financial liability. Where a liability is substantially modified it is considered to be extinguished and a gain or loss is recognized in net income (loss) based on the difference between the carrying amount of the liability derecognized and the fair value of the revised liability. Where a liability is modified in a non-substantial way, the amortized cost of the liability is remeasured based on the new cash flows and a gain or loss is recorded in net income (loss).

Financial assets and liabilities are not offset unless EverGen has the current legal right to offset and intends to settle on a net basis or settle the asset and liability simultaneously.

Related party transactions are accounted for at the exchange amount which is the amount agreed upon between the parties.

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of EverGen’s financial statements include:

Amendments to IFRS 9 “ , IFRS 7 , IFRS 4 “ ” and IFRS 16 for the IASB
publication “Interest Rate Benchmark Reform”, which provides clarity on the changes after the

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reform of an interest rate benchmark. The amendments primarily relate to the modification of financial instruments, allowing for a practical expedient for modifications required by the reform.

International Accounting Standard 1 , (“IAS 1”) has been amended to clarify how to classify debt and other liabilities as either current or non-current. The amendment to IAS 1 is effective for the years beginning on or after January 1, 2023.

EverGen intends to adopt these standards and interpretations when they become effective and is currently assessing the impact of these amendments.

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On December 31, 2020, EverGen acquired all the issued and outstanding common shares of NZWA and all of the issued and outstanding common shares of SSS, both private companies who operate Gore Cover™ organic waste management businesses in British Columbia, in exchange for cash consideration of $24,498, contingent consideration of $5,655 and 777,777 common shares in EverGen. The common shares were valued at $5.00 per common share using the share price of EverGen on the acquisition date.

The goodwill recognized on this acquisition was attributed to the strategic benefits that consolidated operations are expected to bring, expected future cash flows generated from the ability to grow the development of anaerobic digestion infrastructure and eventual sale of RNG, in addition to the recognition of a deferred tax liability generated by the recognition of the fair value of the net assets acquired.

This transaction has been accounted for as a business combination using the acquisition method whereby the net assets acquired and the liabilities assumed are recorded at fair value are as follows:

Cash and cash equivalents	294	358	652
Restricted cash	-	319	319
Accounts receivable	413	1,111	1,524
Prepaid expenses and other assets 67		-	67
Inventories	69	58	127
Carbon emission credits	222	-	222
Property and equipment	6,233	5,364	11,597
Intangible assets	11,590	9,370	20,960
Goodwill	3,420	7,554	10,974
Accounts payable and accrued liabilities (1,008)		(1,649)	(2,657)
Lease liabilities	(2,001)	(1,453)	(3,454)
Deferred tax liabilities	(3,444)	(2,845)	(6,289)

Cash	12,350	12,148	24,498
Common shares	2,222	1,667	3,889
Contingent consideration	1,283	4,372	5,655

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The acquisition includes carbon emission credits generated by NZWA’s organic waste facility which have been valued using the period end trading prices of same or similar credits.

Intangible assets consist of brands valued at $1,180 and customer contracts and relationships valued at $23,780.

The consolidated statement of comprehensive income (loss) includes the results of operations for the period following the close of the transaction on December 31, 2020. EverGen incurred transaction costs of $741 in conjunction with the acquisition, all of which have been expensed.

The above amounts are estimates, which were made by management at the time of the preparation of these consolidated financial statements based on information then available. Amendments may be made to these amounts as values subject to estimate are finalized.

If the closing of the acquisitions had occurred on January 1, 2020, EverGen’s consolidated revenue and net income (loss) would have been $8,868 and $(1,477), respectively.

In addition, the Company’s restricted cash of $319 at December 31, 2020, held in restricted term deposits as required by the Organic Infrastructure Program, see note 5, as well as $447 collateralized accounts receivable at December 31, 2020, see note 6, are also restricted subject to these holdback performance obligations and escrow arrangements.

As at December 31, 2020, EverGen has recognized contingent consideration of $5,655, related to standard indemnity provisions and performance driven holdbacks and working capital adjustments. Performance obligations include the ability to maintain, renew or replace certain and material customer contracts within approximately 15 months from the date of acquisition. Pursuant to customary closing adjustments and the occurrence of performance obligations, the contingent consideration is expected to be settled from holdbacks held in trust, restricted cash and collateralized accounts receivables, see holdback provisions above. Subsequent to December 31, 2020, the Company received notice that it was not successful in securing the renewal of a material contract with Metro Vancouver, see note 21.

The Company’s restricted cash of $319 at December 31, 2020 is held in restricted term deposits as required by the Organic Infrastructure Program, a grant awarded to the Company’s wholly-owned subsidiary SSS, for the expansion of the Company’s organic waste facility.

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Trade receivables	1,056
Organic Infrastructure Program receivable	447
Other	12

The Company, through its wholly-owned subsidiary, SSS, was awarded a federal grant of $765 under the Organic Infrastructure Program for the expansion of its organic waste facility. A portion of the grant, $447 is recorded in accounts receivable at December 31, 2020 and is collateralized, of which $375 was received on May 7, 2021 and held as restricted cash.

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May 13, 2020	-	-	-	-
Acquisition of NZWA	2,385	1,847	2,001	6,233
Acquisition of SSS	2,174	1,737	1,453	5,364

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EverGen’s property and equipment consists of buildings and leasehold improvements, equipment, vehicles and other assets, and ROU assets. The Company’s ROU assets include lease contracts for land and equipment. EverGen leases the land on which it operates and equipment which is used in operations. Depreciation on the acquired assets will commence on January 1, 2021.

As at December 31, 2020 there were no indicators of impairment related to the Company’s property and equipment.

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May 13, 2020	-	-	-
Acquisition of NZWA	110	11,480	11,590
Acquisition of SSS	1,070	8,300	9,370

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Depreciation on the acquired assets will commence on January 1, 2021.

The Company’s goodwill is allocated to the following CGUs:

Net Zero Waste Abbotsford	3,420
Sea to SkySoils	7,554

Goodwill is tested for impairment at the segment level. There was no impairment of goodwill as at December 31, 2020.

Trade payables and accrued liabilities	3,043
Taxes payable	516
Other liabilities	382

On December 16, 2020, EverGen issued convertible notes with a value of $100 in exchange for $100 funds advanced by the Founders during the period ended December 31, 2020. The convertible notes allowed the noteholders to convert the notes into 1,260,000 common shares of the Company at the election of the noteholder. On December 16, 2020, the notes were converted into common shares (note 13).

EverGen acquired $3,454 of lease liabilities on December 31, 2020, of which $225 is current. The Company has lease liabilities for land and equipment. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. Certain of the Company’s leases include purchase options, when a purchase option is expected to be exercised, it is included in the determination of the lease liability. The lease terms of the land leases include all available renewal options to the Company, as lessee, based on the reasonable expectation that these renewal terms will be exercised. EverGen does not have any significant termination options and the residual amounts are not material.

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The Company has authorized an unlimited number of common shares without par value and an unlimited number of preferred shares.

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(thousands)
t May 13, 2020 - - ssuance of common shares to the Founders at incorporation - - ssuance of common shares to Founders on conversion of convertible notes (note 11) 1,260 600 ssuance of common shares to Additional Founders 140 700 ssuance of common shares on non-brokered private placement 1,366 6,830 ssuance of common shares in exchange for advisor services in connection with non-brokered private placement 42 210 ssuance of common shares on brokered private placement 4,617 23,053 ssuance of common shares as consideration for acquisitions (note 4) 778 3,889 hare issue costs,net of tax effect - (2,492)

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On December 16, 2020, the Company:

issued 1,260,000 common shares of EverGen to the Founders on the conversion of convertible notes for funds previously advanced by the Founders; and
in addition, recognized $500 of share-based payment expense related to determining the fair value of these common shares issued to the Founders, see share-based incentive plans and payment plans section.

On December 16, 2020, EverGen appointed an additional director and appointed an additional officer of the Company, (together the “Additional Founders”) and:

issued 140,000 common shares to the Additional Founders at a subscription price of $0.001 per common share; and
in addition, recognized $700 of share-based payment expense related to determining the fair value of these common shares issued to the Additional Founders, see share-based incentive plans and payment plans section.

F-52

On December 22, 2020, EverGen:

completed a brokered private placement of 4,617,000 subscription receipts at $5.00 per subscription receipt for gross proceeds of $23,085;
and issued 277,020 share warrants to advisors as consideration for services rendered in connection with this private placement, see share warrants discussion below.

On December 31, 2020, pursuant to the closing of the acquisitions of NZWA and SSS, each subscription receipt holder received one common share of the Company and the right to receive 0.10 of a common share (each such whole common share being a “share right”) in the event that the Company does not complete a liquidity event by June 22, 2021, for no additional consideration. EverGen determined a fair value of $0.07 per share right, see share rights below and recognized $32 of gross proceeds in share rights and the balance of $23,053 in share capital.

On December 30, 2020, the Company:

completed a non-brokered private placement and issued 1,366,000 common shares at $5.00 per common share for gross proceeds of $6,830;
issued 41,976 common shares with a fair value of $5.00 per common share for advisor services rendered in connection with this private placement; and
issued 62,976 share warrants to advisors as consideration for services rendered in connection with this private placement, see share warrants discussion below.

On January 12, 2021, EverGen completed a non-brokered private placement of 254,000 common shares at $5.00 per common share for gross proceeds of $1,270.

On January 26, 2021, the Company issued 50,000 common shares with a fair value of $5.00 per common share to an advisor and former shareholder of NZWA as consideration for services rendered in connection with the acquisition of NZWA by EverGen at December 31, 2020. The Company recognized $250 of share-based payment expense in connection with the fair value of these services rendered for the period ended December 31, 2020.

F-53

The Company recorded the following share issue costs as a reduction of equity:

Advisor services settled by common share issuance	210
Advisor services settled by share warrant issuance	198
Broker services settled by share warrant issuance	870
Share issue costs paid in cash or accrued	1,663
Tax effect of share issue costs	(449)

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(thousands)
At May 13, 2020 - - ssuance of share warrants as consideration for advisor services in connection with non-brokered private placement 63 198 ssuance of share warrants as consideration for broker services in connection with brokeredprivateplacement 277 870

On December 30, 2020, pursuant to the non-brokered private placement on the same day, the Company issued 62,976 share warrants to advisors as consideration for services rendered in connection with this private placement, see share capital section.

On December 31, 2020, pursuant to the brokered private placement on December 22, 2020, EverGen issued 277,020 share warrants to brokers as consideration for services rendered in connection with this private placement, see share capital section.

Each share warrant entitles the holder to subscribe to one common share at an exercise price of $5.00 per share warrant and expires two years from the date of issuance.

The estimated fair value of the share warrants was calculated at the date of grant using the BlackScholes model and the following weighted-average assumptions:

Share price on grant date	5.00
Fair value per share warrant	3.14
Expected volatility (percent)	126.00
Risk-free interest rate (percent)	0.22
Expected forfeiture rate (percent)	0.00
Expected life (years)	2.00
Expected dividendyield	0.00

Estimated forfeiture rates are adjusted to the actual forfeiture rate at time of forfeiture. Expected volatility is based on the historical volatility of publicly-traded peer companies. Expected life is based on general option-holder behavior and the risk-free interest rate is based on Government of Canada bonds of a similar duration.

For the period ended December 31, 2020, $1,068, related to the share warrants was recognized as share issue costs and a reduction of share capital.

F-54


(thousands)
At May 13, 2020 - - ssuance of share rights at brokeredprivateplacement 462 32

Each share right entitles the holder to receive one common share of EverGen in the event that the Company does not complete a liquidity event by June 22, 2021, for no additional consideration, see share capital section. A liquidity event is defined as:

the Company’s common shares being listed on a recognized Canadian stock exchange through:
a bona fide initial public offering; or
the consummation by the Company of any transaction including, without limitation, any consolidation, amalgamation, merger, plan of arrangement, reverse take-over, qualifying transaction, change of business or any other business combination or similar transaction; or
the entering into of a definitive agreement with a third party that would result in a “Change of Control”, which would be subject to shareholder approval; and
a concurrent financing to raise minimum gross proceeds of at least $10,000.

The estimated fair value of $0.07 per share rights on the brokered private placement at December 31, 2020 was calculated as follows:

determining the maximum number of common shares issuable upon subscription and issuable upon a non-liquidating event taking place;
applying the right to receive 0.10 of a common share for every common share subscribed factor; and
applying management’s best estimated of the probability of not completing a liquidating event by June 22, 2021 based on the Company’s progress and efforts to date at December 22, 2020.

On June 22, 2021, the deadline for completing a liquidity event expired and the holders of 462 share rights became entitled to receive one common share of EverGen for each share right held or 462 common shares of EverGen in the aggregate for no additional consideration. As at July 5, 2021, these common shares have not been issued.

EverGen recorded the following directly in equity related to share-based incentive programs and payment plans:

Issuance of common shares in exchange for advisor services in
connection with non-brokered private placement	210
Issuance of share warrants as consideration for advisor services in
connection with non-brokered private placement	198
Issuance of share warrants as consideration for broker services in
connection withprivateplacement	870

F-55

EverGen recorded the following share-based payment expense in net income (loss) directly related to share-based incentive programs:

Issuance of common shares to Founders on conversion of convertible
notes	500
Issuance of common shares to Additional Founders	700
Performance share units	2
Share-based payment expense to consultant and former shareholder
of NZWA as consideration for services rendered in connection with
the acquisition of NZWA	250

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The Company recognized share-based payment expense of $500 related to determining the fair value of the common shares issued to the Founders upon conversion of the convertible notes (note 11), see issued share capital section. The fair value of the common shares issued was determined based on an estimate of the fair value of the Company’s net assets and the underlying enterprise value created since inception consisting mainly of a negotiated indicative letter of intent to acquire all the issued and outstanding shares of NZWA and SSS. The fair value of obtaining this letter was estimated based on third-party brokerage free quotations for similar agreements and associated costs.

The Company recognized share-based payment expense of $700 related to determining the total fair value of the common shares issued to the Additional Founders, see issued share capital section. The fair value of the common shares used was determined based on the prevailing fair value per common share of the private placements and acquisitions completed in December 2020.

The exercise price and vesting period of PSUs granted is determined by the board of directors at the time of grant, and for each performance share unit exercised, the holder will receive one common share. Each PSU automatically terminates 10 years from the date of grant.

On December 31, 2020, the Company granted 600,000 PSUs to the officers and directors of EverGen. These PSUs were granted subject to the following performance conditions:

Achievement of consolidated earnings before interest, tax, depreciation and amortization of at least $4,500 in a 12-month consecutive period; and
Achievement of average renewable RNG production of at least 500 gigajoules/day over a 12-month consecutive period.

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Beginning, May	13,	2020	-
Granted			600

F-56

The estimated fair value of the performance share units was calculated at the date of grant using the BlackScholes model and the following assumptions:

Share price on grant date	5.00
Fair value per performance share unit	3.39
Expected volatility (percent)	125.00
Risk-free interest rate (percent)	0.23
Expected forfeiture rate (percent)	0.00
Expected life (years)	2.50
Expected dividendyield	0.00

For the period ended December 31, 2020, $2 of share-based payment expense related to PSUs was recognized in net income (loss).

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Professional and consulting fees	281
Other	47

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The Company recognized the following income taxes:

Current tax	-
Deferred tax expense(recovery)	(288)

The provision for income taxes differs from the amount which would be expected by applying the combined federal and provincial statutory income tax rates to net income (loss) before tax.

The following table reconciles income taxes calculated at the statutory rate with the recorded income taxes:

Net income (loss) before income tax	(2,521)
Statutoryincome tax rate(percent)	27.0
Expected income tax expense (recovery) at statutory rate	(681)
Effect on taxes resulting from:
Non-deductible expenses includingshare-basedpayment expenses	393
	(288)

F-57

The temporary differences that give rise to the deferred income tax assets and liabilities are as follows:

The temporary differences that give rise to the deferred income tax assets and liabilities are as follows:	The temporary differences that give rise to the deferred income tax assets and liabilities are as follows:
Balance at May 13, 2020 Recognized in net income (loss) Recognized in equity Recognized on acquisitions (note 4) Balance at December 31, 2020 Property and equipment - - - 1,503 1,503 Intangible assets - - - 5,658 5,658 Carbon emission credits - - - 60 60


Non-capital losses - (379) - - (379) Share issue costs - 90 449 - (359) Lease liabilities - - - 932 (932)

At December 31, 2020, EverGen has approximately $9,000 of tax pools available for future deduction against taxable income.

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The calculation of basic net income (loss) and comprehensive net income (loss) per share for the period ended December 31, 2020 was based on the net income (loss) and comprehensive net income (loss) attributable to common shareholders of $(2,233) and the weighted-average number of common shares outstanding during the year, calculated as follows:

Issued common shares at May 13, 2020	-
Effect of conversion of convertible debenture features	87
Effect of Additional Founders issuance	10
Effect of private placement issuances	31
Effect of shares issued on acquisitions	3
Basic weighted-average common shares outstanding	131

The weighted average common shares have been calculated using a time weighting over the period from date of incorporation of May 13, 2020 to December 31, 2020.

The calculation of diluted net income (loss) and comprehensive net income (loss) does not include warrants, shareholder rights or PSUs as the effect would be anti-dilutive.

The basic and diluted net income (loss) and comprehensive net income (loss) for the period ended December 31, 2020 was $(17.05).

F-58

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EverGen’s financial assets consist of cash and cash equivalents, accounts receivable and carbon emission credits. The Company’s financial liabilities consist of accounts payable and accrued liabilities, contingent consideration and lease liabilities.

Cash and cash equivalents, accounts receivable and accounts payable and accrued liabilities are initially recognized at fair value and subsequently measured at amortized cost. The carrying value of cash and cash equivalents, accounts receivable and accounts payable and accrued liabilities approximates their fair value due to the short-term maturity of those instruments.

The fair value of carbon emission credits is initially measured at fair value using period end trading prices of same or similar carbon emission credits on the secondary market (level 2). Changes in the fair value of the carbon emission credits are recorded at FVOCI.

The fair value of lease liabilities and contingent consideration is initially measured at fair value and carried at amortized cost. The fair value of the lease liabilities and contingent consideration approximates their carrying value due to the specific non-tradeable nature of these instruments.

EverGen’s activities expose it to certain financial risks, including market risk, credit risk and liquidity risk.

Market risk is the risk that changes in market conditions, such as interest rates and foreign exchange rates will affect EverGen’s net income (loss) or value of financial instruments. At December 31, 2020, the Company has fixed interest rates associated with its lease liabilities, thereby substantially reducing the cash flow risk of market fluctuations related to interest rates. EverGen has very few transactions denominated in foreign currencies thereby minimizing risk associated with fluctuations in exchange rates.

Credit risk is the risk that the counterparty to a financial asset will default, resulting in EverGen incurring a financial loss. The Company’s credit risk is concentrated with a few customers, primarily municipal governments. At December 31, 2020, two customers represented 31 percent of accounts receivable and accounts receivable includes $447 of which is collateralized.

The Company, through its wholly-owned subsidiary SSS, submitted a request for proposal for the City of Vancouver’s North Shore Transfer Station related to organics management. The request for proposal was for contracts expiring on June 30, 2021 and currently held by the Company for both tipping and trucking of organic waste. During the year ended December 31, 2020, these contracts accounted for 70 percent SSS’s revenue. On April 16, 2021, the Company was notified that this contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee. See additional information in note 21.

Management uses a provision matrix based upon historical default rates and forward-looking assumptions to calculate expected credit losses and establish a provision for ECLs. The Company’s historical bad debt expense has not been significant and is usually limited to specific customer circumstances. Management considers the credit worthiness of counterparties and past payment history as well as amounts past due. Management regularly monitors customers’ payments and considers all amounts greater than 60 days to be past due. The maximum exposure to credit risk related to trade receivables is their carrying value as disclosed in these financial statements.

EverGen held cash and cash equivalents of $5,003 at December 31, 2020 which represents its maximum credit exposure on these assets; of this amount $319 is held in restricted term deposits. The cash is held with major financial institution counterparties and management believes credit risk is minimal.

F-59

Liquidity risk is the risk that EverGen will be unable to fulfill its obligations on a timely basis or at a reasonable cost. The Company’s objective in managing liquidity risk is to maintain sufficient available resources to meet its liquidity requirements at any point. EverGen achieves this by managing its capital spending and maintaining sufficient funds for anticipated short-term spending.

The expected timing of cash outflows relating to financial liabilities on balance sheet as at December 31, 2020 are:

Accounts payable
and accrued liabilities	3,941	-	-	-	-	-	3,941
Contingent
consideration	5,655	-	-	-	-	-	5,655
Leasepayments(1)	417	417	386	375	315	3,290	5,200

The Company anticipates that its existing capital resources will be adequate to satisfy its liquidity requirements over the next 12 months.

The capital structure of EverGen consists of the following:

Working capital deficit	2,842
Long-term lease liabilities	3,229
Shareholders’ equity	31,909

EverGen’s objectives when managing its capital structure are to maintain financial flexibility so as to preserve the Company’s ability to meet its financial obligations and to finance internally generated growth capital requirements. The Company is not subject to external restrictions on its capital structure. The Company expects to eliminate the working capital deficit with the gross proceeds of equity and debt financings completed subsequent to December 31, 2020.

The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. EverGen considers its capital structure to include working capital, lease liabilities and shareholders’ equity. Management monitors the capital structure and results of operations on a routine basis including the measurement and reporting of key metrics including earnings before interest, tax, depreciation and amortization (“EBITDA”) and adjusted EBITDA which is EBITDA adjusted for share-based payment expense and unusual or non-recurring items. Management considers EBITDA and adjusted EBITDA to be key metrics in analyzing the operational performance of EverGen and the ability to generate cash flow. To maintain or adjust the capital structure, the Company may issue additional debt, issue new shares and adjust capital and operating expenditures to manage its current and projected debt levels.

F-60

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The value of compensation and other fees paid to board of directors and members of executive management of EverGen is as follows:

Share-based payment expense	1,202
Consultingfees included in transaction costs	256

The Company has the following amounts included in accounts receivable which are owing from related parties:

Net Zero Waste East Gate Ltd. 26

EverGen has the following amounts included in accounts payable and accrued liabilities which are owing to related parties:

1210366 BC Ltd.(1)	174
Dekany Consulting Inc.	256
Other	4

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The following table reconciles the net changes in non-cash working capital, excluding the non-cash working capital acquired on acquisitions, from the statement of financial position to the statements of cash flows:

Net changes in non-cash working capital:
Prepaid expenses and other assets	(45)
Accountspayable and accrued liabilities	1,292
Net changes in non-cash working capital related to:
Operating activities	1,023
Financingactivities	224

During the period ended December 31, 2020, EverGen did not pay any interest or taxes.

F-61

The following table reconciles the movement in cash flows arising from financing activities:

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----- Start of picture text -----

-
Balance, beginning of period
Liabilities acquired on acquisition 3,454
-
Balance, beginning of period
Proceeds from issuances and subscriptions 29,883
Funds advanced by Founders and exchanged for convertible notes
and subsequently converted to common shares 100
Issuance costs (1,663)
Non-cash items
Share-based payments of common shares to Founders on
conversion of convertible notes 500
Share-based payments of common shares issued to Additional
Founders 700
Common shares issued in exchange for advisor services 210
Issued as consideration on acquisitions 3,889
Non-cash issuance costs (1,278)
Tax effect of issuance costs 449
-
Balance, beginning of period
Proceeds from issuances and subscriptions 32
-
Balance, beginning of period
Issuance of convertible notes in exchange for Founders’ funds
advanced 100
Non-cash items
Conversion to common shares (100)
-
----- End of picture text -----

F-62

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At December 31, 2020, EverGen had the following additional contractual obligations and commitments as follows:

Service contracts[(1) ] 12 12 5 5 4 - 38

In addition to the above amounts, the Company has annual commitments related to certain of its land leases for utilities and property taxes that fluctuate with usage and assessments, respectively.

EverGen believes that the accruals for tax liabilities are adequate for all open tax years based on the assessment of many factors, including interpretations of tax law and prior experience.

On January 12, 2021, EverGen completed a non-brokered private placement of 254,000 common shares for gross proceeds of $1,270.

On March 15, 2021, Jennifer Schilling, was appointed Chief Financial Officer of EverGen.

The credit facility agreement is subject to the following covenants:

Maintain a consolidated working capital ratio equal to or greater than 1.20:1 at all times;
Maintain a consolidated “fixed charge coverage ratio” as defined in the agreement equal to or greater than 1.20:1 at all times, tested quarterly on a rolling four quarters basis;
Maintain a consolidated “total funded debt to EBITDA ratio” as defined in the agreement equal to or less 3.00 at all times, tested quarterly on a rolling four quarters basis; and
Other operational and financial covenants including but not limited to the Company’s ability to pay dividends, incur additional debt, directly or indirectly grant loans or make investments and other such matters.

F-63

On March 18, 2021, the Company adopted an equity incentive plan which provides for the granting of options, restricted share units and deferred share units. In addition, on March 18, 2021, the Company granted (i) 195,000 Options to officers, an employee and consultants of the Company; (ii) 17,500 restricted share units to an officer and consultants of the Company and (iii) 27,500 deferred share units to its directors.

On April 27, 2021, EverGen completed a non-brokered private placement of 111,111 common shares at a price of $9.00 per common share for gross proceeds of $1,000.

On April 28, 2021, the Company filed a preliminary prospectus with the intention of completing an initial public offering.

On June 29, 2021, the Company granted 100,000 restricted share units to an officer of the Company.

F-64

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Independent auditor’s report

To the Board of Directors of Net Zero Waste Abbotsford Inc.

Our opinion

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Net Zero Waste Abbotsford Inc. (the Company) as at December 31, 2020 and 2019 and January 1, 2019, and its financial performance and its cash flows for the years ended December 31, 2020 and 2019 in accordance with International Financial Reporting Standards (IFRS).

What we have audited

The Company’s financial statements comprise:

the statements of financial position as at December 31, 2020 and 2019 and January 1, 2019;
the statements of net income and comprehensive income for the years ended December 31, 2020 and 2019;
the statements of shareholders’ equity for the years ended December 31, 2020 and 2019;
the statements of cash flows for the years ended December 31, 2020 and 2019; and
the notes to the financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada. We have fulfilled our other ethical responsibilities in accordance with these requirements.

PricewaterhouseCoopers LLP

111-5th Avenue SW, Suite 3100, Calgary, Alberta, Canada T2P 5L3 T: +1 403 509 7500, F: +1 403 781 1825

“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

F-65

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Other information

Management is responsible for the other information. The other information comprises the Management’s Discussion and Analysis.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the financial statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

F-66

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As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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Chartered Professional Accountants

Calgary, Alberta July 5, 2021

F-67

As at

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----- Start of picture text -----

Cash 294 27 194
Accounts receivable 4 413 413 475
Prepaid expenses and other 67 63 63
Inventories 69 39 23
Property and equipment 5 6,123 5,273 5,216
Bank indebtedness - 42 -
Accounts payable and accrued liabilities 6 1,008 464 405
Lease liabilities and loans 7 133 1,123 1,256
Preferred shares 8 - 420 970
Lease liabilities and loans 7 1,868 1,874 2,253
Deferred income taxes 14 224 211 152
Share capital 9 1 1 1
Contribution from parent 9 958 - -
Retained earnings 9 2,774 1,680 934
----- End of picture text -----

The notes are an integral part of these financial statements.

Commitments and contingencies 19

Signed

Chase Edgelow, Director

Mischa Zajtmann, Director

F-68

For the years ended December 31,



Revenue 10 3,919 Cost ofgoods sold 933		3,414 1,360
Gross profit 2,986 Operating costs 737 General and administrative expenses 11 315 Depreciation 5 408 Finance costs (income), net 12 195 Other(income)expense,net 13 (129)		2,054 389 281 319 154 (36)
Tax expense 14 366		201

	15

The notes are an integral part of these financial statements.

F-69

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----- Start of picture text -----

Balance, January 1 9 1 1
- -
Balance, January 1
Capital contribution from parent 9 958 -
Balance, January 1 1,680 934
Total comprehensive income 1,094 746
----- End of picture text -----

The notes are an integral part of these financial statements.

F-70

For the years ended December 31



1,094 ffecting cash: tion 5 408 come) expense, net 13 (20) income tax expense (recovery) 14 13 non-cash workingcapital 18 510		746 319 - 59 105

es onpropertyand equipment 5 (633)		(282)

tedness (42) of principal portion of lease liabilities 7 (132) lease purchase option 7 (50) om loans received 7 560 of loans 7 (1,979) hares redeemed 8 (420) tribution 9 958		42 (178) - - (428) (550) -

indebtedness), beginning of year 27		194

The notes are an integral part of these financial statements.

F-71

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Net Zero Waste Abbotsford Inc. (“NZWA”) operates a Gore Cover™ organic waste management facility in British Columbia. The Company processes organics and yard waste for a contracted “tipping” fee and produces high-quality organic compost and soils for farmers, gardeners and developers as part of its outbound business. The Company was incorporated under the on August 24, 2012.

On December 31, 2020, the Company completed a plan of arrangement (the “Arrangement”) with EverGen Infrastructure Inc. (“EverGen”) and Sea to Sky Soils and Composting Inc. (“SSS”) whereby all the issued and outstanding shares of NZWA and all the issued and outstanding shares of SSS were acquired by EverGen. These transactions were accounted for as business combinations.

The Company’s revenue, costs of goods sold and certain operating costs are impacted by seasonal weather variation and the related fluctuations in volumes processed.

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These financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial Reporting Interpretations Committee. These are the Company’s first financial statements prepared in accordance with IFRS and IFRS 1, “ ”, (“IFRS 1”) has been applied.

The policies applied in these financial statements are based on IFRS issued, effective and outstanding as of December 31, 2020. These financial statements were approved and authorized for issuance by NZWA’s board of directors on July 5, 2021.

These financial statements are presented in Canadian dollars, the Company’s functional currency, unless otherwise indicated.

These financial statements have been prepared on a historical cost basis, except as detailed in the Company’s accounting policies disclosed in note 3.

The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. These estimates and judgments are based on management’s best understanding of current events and actions that the Company may undertake in the future. Actual results may differ from these estimates and judgments. Estimates and their underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which estimates are revised and for any future years affected.

Significant estimates and judgments used in the preparation of these financial statements are outlined below.

F-72

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In accordance with IFRS, management elected to record the carrying amount of property and equipment as deemed cost at fair value as at the date of transition to IFRS. The estimation of fair value involves significant estimates and judgements related to useful life, the general condition of property and equipment, patterns of normal wear and tear and the rate of technological change of the underlying assets.

Property and equipment assets are tested for impairment when events or changes in circumstances indicate that the carrying amount exceeds the recoverable amount.

Depreciation of the Company’s property and equipment incorporates estimates of useful lives and residual values. These estimates may change as more knowledge is obtained or as general market conditions change or as technological advancements are made.

Management applies judgment in reviewing each of its contractual arrangements to determine whether the arrangement contains a lease. The measurement of lease liabilities and right-of-use (“ROU”) assets incorporates an estimate of lease terms and discount rates. The term of a lease is determined as the noncancellable period of a lease and includes periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option. In considering the option to extend a lease, the Company considers all the relevant facts and circumstances that create an economic incentive to exercise or not exercise the option. The assessment is reviewed if a significant change in circumstances occurs which affects this assessment. Where the rate implicit in a lease is not readily determinable, the discount rate is estimated using a discount rate similar to the Company’s incremental borrowing rate to purchase an asset of similar value, with similar payment terms and security.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement amounts of existing assets and liabilities and their respective tax basis. Estimates of the Company’s future taxable income are considered in assessing the utilization of available tax losses. The calculation of income taxes involves many complex factors including the interpretation of relevant tax legislation and an analysis of the amount of future taxable profits.

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In March 2020, the World Health Organization declared a global pandemic due to Novel Coronavirus (“COVID-19”). COVID-19 has significantly impacted the global economy. The full extent and impact of the COVID-19 pandemic to the Company’s operations and future financial performance is unknown at this time and depends on a number of future developments which are uncertain and unpredictable. These future developments include the duration and spread of COVID-19, its continued impact on capital and financial markets and new information that may emerge concerning the severity of the virus. These uncertainties may continue beyond the determination of how to contain the virus and treatment of those impacted. The ongoing pandemic presents uncertainty and risk to the Company, its performance, and the estimates and assumptions used by management to prepare its financial results.

The Company adopted IFRS effective January 1, 2019. IFRS 1, which governs the first-time adoption of IFRS, in general requires accounting policies under IFRS to be applied retrospectively to determine the opening balance sheet of the Company as of the transition date and allows certain exemptions which the Company has elected to apply. Those elections considered significant to the financial statements of the Company include the decision to record the carrying amount of property and equipment as deemed cost at fair value as of the date of transition.

The accounting policies set out below have been applied consistently by the Company for all periods presented in these financial statements and for the purposes of preparing the opening IFRS balance sheet at January 1, 2019.

Revenue is generated primarily from tipping fees charged to customers upon receipt of organic waste at the Company’s organic waste facility and through the sale of organic compost and soil. Revenues are influenced by various factors such as the type and weight or volume of waste materials disposed of at the Company’s facility.

Revenue from the sale of organic compost and soil is recognized when transfer of control exists, primarily at the transfer of finished goods inventory to the customer.

The Company’s revenue transactions do not contain significant financing components and payments are typically due within 30 days of revenue recognition. The Company does not have contracts where the period between the transfer of the promised goods or services to the customer and payments by the customer exceeds one year. As such, no adjustments are made to the transaction prices for the time value of money. The Company does not disclose information about remaining performance obligations that have an original expected duration of one year or less and it does not have any long-term contracts with unfulfilled performance obligations.

Finance income is recognized as it accrues using the effective interest rate method.

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Operating costs are comprised of repairs and maintenance, utilities, licenses and permits and property taxes.

Finance costs consists primarily of the interest component of lease payments and interest recognized on loans which is expensed as incurred.

IFRS 1 allows the recognition of property and equipment in the IFRS opening balance sheet at deemed cost as an alternative to the cost prescribed in International Accounting Standard 16. “

”. In accordance with IFRS 1, the Company has elected to record the carrying amount of property and equipment as deemed cost at fair value as of the date of transition. An independent valuator was involved in determining fair value. Subsequent to January 1, 2019, property and equipment has been measured at cost less accumulated depreciation and impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the assets and subsequent expenditures to the extent that they can be measured, and future economic benefit is probable. Repairs and maintenance are expensed as incurred.

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Buildings and leasehold improvements Equipment, vehicles and other Right-of-use assets		15 – 25 years 10 – 15 years 2 – 19years

The Company assesses whether a contract is a lease; based on whether the contract conveys the right to control the use of an underlying asset for a period of time in exchange for consideration. The Company allocates the consideration in the contract to each lease component on the basis of their relative standalone prices.

Leases are recognized as a ROU asset and a corresponding lease liability at the date on which the leased asset is available for use by the Company. Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of fixed payments, variable lease payments that are based on an index or a rate, amounts expected to be paid by the lessee under residual value guarantees, the exercise price of purchase options if the lessee is reasonably certain to exercise that option, and payments of penalties for terminating the lease, less any lease incentives receivable. These payments are discounted using the Company’s incremental borrowing rate when the rate implicit in the lease is not readily available. The Company uses a single discount rate for a portfolio of leases with reasonably similar characteristics.

Lease payments are allocated between the liability and finance costs. The finance cost is charged to net income (loss) over the lease term.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in the future lease payments arising from a change in an index or rate, if there is a change in the amount expected to be payable under a residual value guarantee or if there is a change in the assessment of whether the Company will exercise a purchase, extension or termination option that is within the control of the Company. When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the ROU asset or is recorded in net income (loss) if the carrying amount of the ROU asset has been reduced to zero.

The ROU asset is depreciated on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term. The ROU asset may be adjusted for certain remeasurements of the lease liability and impairment losses.

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Leases that have a term of less than twelve months or leases on which the underlying asset is of low value are recognized as an expense in net income (loss) over the lease term.

A lease modification will be accounted for as a separate lease if the modification increases the scope of the lease and if the consideration for the lease increases by an amount commensurate with the standalone price for the increase in scope. For a modification that is not a separate lease or where the increase in consideration is not commensurate, at the effective date of the lease modification, the Company will remeasure the lease liability using the Company’s incremental borrowing rate, when the rate implicit to the lease is not readily available, with a corresponding adjustment to the ROU asset. A modification that decreases the scope of the lease will be accounted for by decreasing the carrying amount of the ROU asset, and recognizing a gain or loss in net income (loss) that reflects the proportionate decrease in scope.

Property and equipment is reviewed for indicators of impairment at each reporting period or when facts and circumstances suggest that the carrying amount may exceed its recoverable amount. Such indicators include but are not limited to changes in the Company’s business plans, economic performance of the assets, changes in activity levels, an increase in the discount rate or evidence of physical damage or obsolescence.

If the recoverable amount is less than the carrying amount, an impairment loss is recognized immediately in net income (loss).

Impairment losses recognized in prior periods are assessed at each reporting date for any indicators that the impairment losses may no longer exist or may have decreased. In the event that an impairment loss reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the carrying amount does not exceed the amount that would have been determined had no impairment loss been recognized on the asset in prior periods. The amount of the reversal is recognized in net income (loss).

Preferred shares that are mandatorily redeemable or redeemable at the option of the shareholder and which the Company is obligated to pay a specified dividend are accounted for as a liability. Nondiscretionary dividends are recognized as finance cost in net income (loss) as accrued.

A provision is recognized if, as a result of a past event, the Company has a present obligation, legal or constructive, that can be estimated reliably, and it is more likely than not that an outflow of economic benefits will be required to settle the obligation. Where applicable, the future cash flow estimates are adjusted to reflect risks specific to the liability.

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remote. Contingent assets are not recognized but are disclosed when an inflow of economic benefits is probable.

Deferred tax is recognized in respect of temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is determined on a non-discounted basis using tax rates and laws that have been enacted or substantively enacted at the balance sheet date and are expected to apply when the deferred tax asset or liability is settled. Deferred tax assets are recognized to the extent that it is probable that the future taxable profits will be available against which they can be utilized. The carrying amount of a deferred tax asset is reviewed at the end of each reporting period. The Company reduces the carrying amount of a deferred tax asset to the extent that it is no longer probable that sufficient taxable income will be available to allow the benefit of part or all of these deferred tax assets to be utilized.

Common shares are classified as equity. Incremental costs directly attributable to the issuance of shares are recognized as a deduction from equity.

Basic income and diluted income per share is calculated by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. The Company has no dilutive instruments.

The Company’s financial assets consist of cash and accounts receivable. The Company’s financial liabilities consist of accounts payable and accrued liabilities, preferred shares, lease liabilities and loans.

Financial instruments are recognized when the Company becomes a party to the contractual provisions of the instrument. Financial instruments are recognized at fair value on initial recognition less transaction costs directly attributable to the acquisition or issuance of the financial instrument. Measurement in subsequent periods depends on the purpose for which the instruments were acquired. Financial assets are subsequently measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss (“FVTPL”) on the basis of the Company’s business model and contractual cash flows of the financial asset. Financial liabilities are subsequently measured at amortized cost or FVTPL. Amortized

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cost is calculated by taking into account any issue costs. Interest expense is recognized in net income (loss).

The Company characterizes its fair value measurements into a three-level hierarchy depending on the degree to which the inputs are observable as follows:

Level 1 inputs are quoted prices in active markets for identical assets and liabilities;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.

A financial asset is derecognized when the rights to receive cash flows from the asset have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.

The Company recognizes loss allowances for ECLs on its financial assets measured at amortized cost. Due to the nature of its financial assets, the Company measures loss allowances at an amount equal to expected lifetime ECLs. Lifetime ECLs are the anticipated ECLs that result from all possible default events over the expected life of a financial asset. ECLs are a probability-weighted estimate of credit losses. Management uses a provision matrix based upon historical default rates and forward-looking assumptions to calculate expected credit losses and establish a provision for ECL. The Company’s historical bad debt expense has not been significant and is typically limited to specific customer circumstances. Management considers the credit worthiness and past payment history as well as any past due amounts in determining ECLs. Management’s assumptions are updated and adjusted at each reporting date. Credit losses are measured as the present value of all cash shortfalls, i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Company expects to receive. ECLs are discounted at the effective interest rate of the related financial asset. The Company does not have any financial assets that contain a financing component.

Financial assets and liabilities are not offset unless the Company has the current legal right to offset and intends to settle on a net basis or settle the asset and liability simultaneously.

Related party transactions are accounted for at the exchange amount which is the agreed upon amount between the parties.

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements include:

Amendments to IFRS 9 “ , IFRS 7 , IFRS 4 “ ” and IFRS 16 for the IASB
publication “Interest Rate Benchmark Reform”, which provides clarity on the changes after the

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reform of an interest rate benchmark. The amendments primarily relate to the modification of financial instruments, allowing for a practical expedient for modifications required by the reform.

International Accounting Standard 1 , (“IAS 1”) has been amended to clarify how to classify debt and other liabilities as either current or non-current. The amendment to IAS 1 is effective for the years beginning on or after January 1, 2023.

The Company intends to adopt these standards and interpretations when they become effective and is currently assessing the impact of these amendments.

Trade receivables	415	419	478
Credit loss allowance	(2)	(6)	(3)

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January 1, 2019 1,994 1,580 1,642 5,216 Additions 146 136 94 376
At December 31, 2019 2,140 1,716 1,736 5,592 Additions 476 157 625 1,258 Exercise of leasepurchase option - 266 (266) -


January 1, 2019 - - - - Depreciation 103 114 102 319
At December 31, 2019 103 114 102 319 Depreciation 127 130 151 408 Exercise of leasepurchase option - 49 (49) -



At January 1, 2019 1,994 1,580 1,642 5,216 At December 31, 2019 2,037 1,602 1,634 5,273

During the year ended December 31, 2020, the Company received insurance proceeds of $109 for the disposal of an asset with a carrying value of $nil. The full amount of insurance proceeds has been recorded in other income (note 13).

The Company’s ROU assets include lease contracts for land on which it operates and equipment which is used in operations.

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As at December 31, 2020 and December 31, 2019, there were no indicators of impairment related to the Company’s property and equipment.

Trade payables and accrued liabilities	483	231	232
Corporate taxes payable	369	143	69
Other liabilities	156	90	104

At December 31, 2020, trade payables and accrued liabilities includes $300 (2019 – $nil) for an accrual related to a regulatory compliance related matter

The Company has lease liabilities and loans consisting of the following:

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----- Start of picture text -----

Lease liabilities 2,001 1,558 1,642
Loans - 1,439 1,867
As at January 1, 2019 1,642
Additions 94
Interest expense (note 12) 89
Lease payments (267)
As at December 31, 2019 1,558
Additions 625
Interest expense (note 12) 113
Lease payments (245)
Exercise of lease purchase option (50)
As at December 31, 2020
Less current portion
Long-term portion
----- End of picture text -----

The Company has lease liabilities for land and equipment. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. Certain of the Company’s leases include purchase options. When a purchase option is expected to be exercised, it is included in the determination of the lease liability. The lease terms of the land leases include all available renewal options to the Company, as lessee, based on the reasonable expectation that these renewal terms will be exercised. The Company does not have any significant termination options and the residual amounts are not material.

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The Company has variable lease payments related to property taxes for land contracts. During the year ended December 31, 2020, the Company expensed variable lease payments of $12 (2019 - $16). The Company has no short-term leases.

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January 1, 2019	1,217	650	1,867
Principal repayment	(428)	-	(428)
At December 31, 2019	789	650	1,439
Advances	560	-	560
Principal repayment	(1,329)	(650)	(1,979)
Loan forgiveness(note 13)	(20)	-	(20)

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The Company’s loan borrowings relate to the following facilities:

As at January 1, 2019, the Company had $1,217 outstanding on a term loan facility with an original loan value of $1,320. The term loan facility bears interest at prime plus 2.25 percent per annum, had a term of three years and was subject to various operational and financial covenants. The term loan facility was repaid in full as at December 31, 2020. The facility was cancelled subsequent to December 31, 2020.

The Company had a credit facility of $100 to be used for working capital and general purposes. The credit facility bears interest at prime plus 1.45 percent and is due on demand. No amounts were drawn under this facility as at and during the year ended December 31, 2020 (2019 - $nil). The facility was cancelled subsequent to December 31, 2020.

During the year ended December 31, 2020, the Company received gross proceeds of $500 under an agriculture loan facility which bears interest at prime plus 1.45 percent and is due on demand. The term loan facility was repaid in full as at December 31, 2020. The facility was cancelled subsequent to December 31, 2020.

During the year ended December 31, 2020, the Company received $60 related to a third-party loan, of which $20 was forgiven if the amount was repaid prior to December 31, 2022. At December 31, 2020, the amounts were repaid and the forgivable portion included in other income (note 13).

The Company has unsecured non-interest-bearing loans payable to related parties. The non-interestbearing loans have no fixed repayment terms and are due on demand. The non-interest-bearing loans were repaid during the year ended December 31, 2020.

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A summary of the preferred share liability is as follows:


(thousands)
ary 1, 2019 970 970 n ofpreferred shares (550) (550)
mber 31, 2019 420 420 n ofpreferred shares (420) (420)

The Company had issued redeemable preferred shares with gross proceeds of $1.00 per preferred share. The preferred shares are redeemable and due on demand. During the year ended December 31, 2020, 420 thousand preferred shares were redeemed for gross proceeds of $420 (2019 – 550 thousand preferred shares for gross proceeds of $550).

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The Company has authorized an unlimited number of common shares and an unlimited number of preferred shares.

As at December 31, 2020, December 31, 2019 and January 1, 2019, the Company had 1,000 common shares outstanding with a carrying value of $1.

On December 31, 2020, the issued and outstanding shares were acquired by EverGen.

During the year ended December 31, 2020, the Company received a capital contribution of $958 from EverGen which was used to repay outstanding loans (note 7).

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Tipping fees	3,596	3,153
Organic compost and soil sales	294	256
Other	29	5

Tipping fee income includes the disposal of organic waste.

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Salaries and wages	165	151
Professional and consulting fees	114	94
Other	36	36

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Interest expense on lease liabilities (note 7)	113	89
Interest expense on loans (note 7)	59	58
Other	23	10
Interest income	-	(3)


Insurance proceeds (note 5)	109	-
Other	20	36

The Company recognized the following income taxes:

Current tax expense	353	142
Deferred tax expense	13	59

The provision for income taxes differs from the amount which would be expected by applying the combined federal and provincial statutory income tax rates to net income before tax.

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The following table reconciles income taxes calculated at the statutory rate with the recorded income taxes:

Net income before income tax 1,460 947 Statutoryincome tax rate(percent) 27.0 27.0	Net income before income tax 1,460 947 Statutoryincome tax rate(percent) 27.0 27.0
Expected income tax expense (recovery) at statutory rate 394 256 Effect on taxes resulting from: Non-deductible expenses 7 8 Other (35) (63)

The temporary differences that give rise to the deferred income tax assets and liabilities are as follows:

	Balance at		Balance at
	December 31,	Recognized in	December 31,
	2019	net income	2020
Deferred income tax liabilities
Propertyand equipment	633	132	765
	633	132	765
Deferred income tax assets
Lease liabilities	(421)	(119)	(540)
Other	(1)	-	(1)
	(422)	(119)	(541)

	Balance at		Balance at
	January 1,	Recognized in	December 31,
	2019	net income	2019
Deferred income tax liabilities
Propertyand equipment	596	37	633
	596	37	633
Deferred income tax assets
Lease liabilities	(444)	23	(421)
Other	-	(1)	(1)
	(444)	22	(422)

At December 31, 2020 the Company has approximately $3,300 of tax pools available for future deduction against taxable income (December 31, 2019 - $2,900).

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The calculation of basic and diluted net income and comprehensive net income per share for the year ended December 31, 2020 was based on the net income and comprehensive net income attributable to common shareholders of $1,094 (2019 - $746) and the weighted-average number of common shares outstanding during the year. The weighted-average number of common shares outstanding was 1,000 common shares in both the year ended December 31, 2020 and the year ended December 31, 2019. Basic and diluted net income and comprehensive net income for the year ended December 31, 2020 was $1,094.00 per share (2019 - $746.00 per share).

The Company had no dilutive instruments outstanding for the years ended December 31, 2020 and December 31, 2019.

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Cash, accounts receivable and accounts payable and accrued liabilities are initially recognized at fair value and subsequently measured at amortized cost. The carrying value of cash, accounts receivable and accounts payable and accrued liabilities approximates their fair value due to the short-term maturity of those instruments.

Lease liabilities and loans are initially measured at fair value and carried at amortized cost. The fair value of the lease liabilities and loans payable to third parties approximates their carrying value due to the specific non-tradeable nature of these instruments. The estimated fair value of the loans payable to related parties approximates the carrying value due to no fixed terms of repayment and the demand feature of the loans.

Redeemable preferred shares are initially measured at fair value and carried at amortized cost. The estimated fair value of the redeemable preferred shares approximates the carrying value due to no fixed terms of redemption and the ability of the holder to demand redemption.

The Company’s activities expose it to certain financial risks, including market risk, credit risk and liquidity risk.

Market risk is the risk that changes in market conditions, such as interest rates and foreign exchange rates will affect the Company’s net income (loss) or value of financial instruments. At December 31, 2020, the Company has fixed interest rates associated with its lease liabilities, thereby substantially reducing the cash flow risk of market fluctuations related to interest rates. The Company has very few transactions denominated in foreign currencies thereby minimizing risk associated with fluctuations in exchange rates.

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31, 2020, four customers represented 81 percent of accounts receivable (December 31, 2019 – two customers represented 76 percent of accounts receivable).

Management uses a provision matrix based upon historical default rates and forward-looking assumptions to calculate expected credit losses and establish a provision for ECLs. The Company’s historical bad debt expense has not been significant and is usually limited to specific customer circumstances. Management considers the credit worthiness of counterparties and past payment history as well as amounts past due. Management regularly monitors customers’ payments and considers all amounts greater than 60 days to be past due. At December 31, 2020, approximately 26 percent of trade receivables were past due but not considered impaired (December 31, 2019 – 10 percent). The maximum exposure to credit risk related to trade receivables is their carrying value as disclosed in these financial statements. There have been no changes in the assumptions used to determine the provision for ECL during the year ended December 31, 2020.

The Company held cash of $294 at December 31, 2020 (December 31, 2019 - $27) which represents its maximum credit exposure on these assets. The cash is held with major financial institution counterparties and management believes credit risk is minimal.

Liquidity risk is the risk that the Company will be unable to fulfill its obligations on a timely basis or at a reasonable cost. The Company’s objective in managing liquidity risk is to maintain sufficient available resources to meet its liquidity requirements at any point. The Company achieves this by managing its capital spending and maintaining sufficient funds for anticipated short-term spending.

The expected timing of cash outflows relating to financial liabilities on balance sheet as at December 31, 2020 are:

Accounts payable
and accrued liabilities	1,008	-	-	-	-	-	1,008
Leasepayments(1)	244	244	213	211	194	1,920	3,026

The Company anticipates that its existing capital resources will be adequate to satisfy its liquidity requirements over the next 12 months.

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The capital structure of the Company consists of the following:

Lease liabilities and loans	2,001	2,996	3,510
Shareholders’ equity	3,733	1,681	935

The Company’s objectives when managing its capital structure are to maintain financial flexibility so as to preserve the Company’s ability to meet its financial obligations and to finance internally generated growth capital requirements. The Company is not subject to external restrictions on its capital structure.

The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. The Company considers its capital structure to include lease liabilities, loans and shareholders’ equity. Management monitors the capital structure and results of operations on a routine basis including the measurement and reporting of key metrics including earnings before interest, tax, depreciation and amortization (“EBITDA”) and adjusted EBITDA which is EBITDA adjusted for unusual or non-recurring items. Management considers EBITDA to be a key metric in analyzing the operational performance of the Company and the ability to generate cash flow. To maintain or adjust the capital structure, the Company may issue additional debt, issue new shares and adjust capital and operating expenditures to manage its current and projected debt levels.

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The value of compensation and other fees paid to board of directors and members of executive management of the Company is as follows:

Salaries and benefits 164 151

The exchange value of revenue earned from and expenses paid to related parties of the Company is as follows:

Revenue	29	-
Expenses	22	-

Revenue earned from related parties during the year ended December 31, 2020 includes $29 for rental of equipment (2019 - $nil) to an entity in which a member of NZWA’s key management personnel is a shareholder and director.

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The Company has the following amounts included in accounts receivable which are owing from related parties:

Net Zero Waste East Gate Ltd.	26	-	-
Sea to SkySoils and CompostingInc.	9	27	79

The following table reconciles the net changes in non-cash working capital from the statements of financial position to the statements of cash flows:

Net changes in non-cash working capital:
Accounts receivable	-	62
Prepaid expenses and other	(4)	-
Inventories	(30)	(16)
Accountspayable and accrued liabilities	544	59

Interest paid	147	172
Taxespaid	69	127

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The following table reconciles the movement in cash flows arising from financing activities:

Balance, beginning of year	1,558	1,642
Additions	625	94
Principal repayments	(132)	(178)
Exercise of leasepurchase option	(50)	-

Balance, beginning of year	1,439	1,867
Advances	560	-
Principal repayments	(1,979)	(428)
Non-cash loan forgiveness	(20)	-

Balance, beginning of year	420	970
Redemption ofpreferred shares	(420)	(550)

Balance, beginning of year	-	-
Cash contribution	958	-

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At December 31, 2020, the Company had the following additional contractual obligations and commitments as follows:

Service contracts[(1) ] 12 12 5 5 4 - 38

In addition to the above amounts, the Company has annual commitments related to its land leases for utilities and property taxes that fluctuate with usage and assessments, respectively. During the year ended December 31, 2020, the Company recognized $14 in operating costs for utilities and property taxes related these annual commitments (2019 - $18).

The Company believes that the accruals for tax liabilities are adequate for all open tax years based on the assessment of many factors, including interpretations of tax law and prior experience.

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As stated in note 2, these are the Company’s first financial statements prepared in accordance with IFRS. The accounting policies set out in note 3 have been applied in preparing the financial statements as at and for the year ended December 31, 2020, the comparative financial statements as at and for the year ended December 31, 2019 and in the preparation of an opening IFRS balance sheet at January 1, 2019, the date of transition. IFRS standards have been adopted retroactively.

In preparing the opening IFRS balance sheet, the Company has adjusted amounts previously reported under Accounting Standards for Private Enterprises (“ASPE”). An explanation of how the transition from ASPE to IFRS has affected the financial position, financial performance and cash flows is set out in the following tables and the notes that accompany the tables.

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----- Start of picture text -----

Cash and cash equivalents 194 - 194
Accounts receivable a 478 (3) 475
Prepaid expenses and other 63 - 63
Inventories 23 - 23
Property and equipment b,c 2,756 2,460 5,216
Accounts payable and accrued liabilities 405 - 405
Lease liabilities and loans c,d 1,077 179 1,256
Preferred shares 970 - 970
Lease liabilities and loans c,d 789 1,464 2,253
Deferred income taxes f - 152 152
Share capital 1 - 1
Retained earnings 272 662 934
----- End of picture text -----

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----- Start of picture text -----

Cash 27 - 27
Accounts receivable a 419 (6) 413
Prepaid expenses and other 63 - 63
Inventories 39 - 39
Property and equipment b,c 2,725 2,548 5,273
Bank indebtedness 42 - 42
Accounts payable and accrued liabilities 464 - 464
Lease liabilities and loans c 897 226 1,123
Preferred shares 420 - 420
Loans and lease liabilities c 410 1,464 1,874
Deferred income taxes d - 211 211
Share capital 1 - 1
Retained earnings 1,039 641 1,680
----- End of picture text -----

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3,414 ds sold 1,360		- -	3,414 1,360
	3,414
	1,360
osts c administrative expenses n b,c ts (income), net c e	2,054	-	2,054 389 281 319 154 (36)

	429	(40)
	278	3
	408	(89)
	65	89
	(36)	-
e d			201
	142	59

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In accordance with IFRS, management recognizes loss allowances for ECLs on its financial assets measured at amortized cost.

In accordance with IFRS, management elected to record the carrying amount of property and equipment as deemed cost at fair value as at the date of transition to IFRS. As a result, the carrying value of property and equipment was increased by $818 at January 1, 2019. In addition, management changed the depreciation method from declining balance to straight-line over the estimated useful life of the underlying asset. The impact of the increase in fair value and change in depreciation methods resulted in a net decrease in depreciation expense of $190.

Under ASPE, leases were classified as operating and financing leases. In accordance with IFRS, the Company removes the classification of leases as either operating or financing leases, effectively treating all leases as finance leases. Certain short-term leases, less than 12 months, and leases of low-value assets are exempt from the recognition requirements of IFRS and are expensed as incurred in net income (loss). The impact of this change in classification is to increase ROU assets which are included as a component of property and equipment and increase lease liabilities on the date of transition by $1,642. In addition, depreciation expense and finance costs increased by $101 and $89, respectively and operating costs decreased by $40 for the year ended December 31, 2019.

The above changes resulted in an increase of $211 to the deferred tax liability at December 31, 2019. The deferred tax liability was calculated based on a tax rate of 27.0 percent.

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Independent auditor’s report

To the Board of Directors of Sea to Sky Soils and Composting Inc.

Our opinion

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Sea to Sky Soils and Composting Inc. (the Company) as at December 31, 2020 and 2019 and January 1, 2019, and its financial performance and its cash flows for the years ended December 31, 2020 and 2019 in accordance with International Financial Reporting Standards (IFRS).

What we have audited

The Company’s financial statements comprise:

the statements of financial position as at December 31, 2020 and 2019 and January 1, 2019;
the statements of net income and comprehensive income for the years ended December 31, 2020 and 2019;
the statements of shareholders’ equity for the years ended December 31, 2020 and 2019;
the statements of cash flows for the years ended December 31, 2020 and 2019; and
the notes to the financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

Other information

Management is responsible for the other information. The other information comprises the Management’s Discussion and Analysis.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

PricewaterhouseCoopers LLP 111-5th Avenue SW, Suite 3100, Calgary, Alberta, Canada T2P 5L3 T: +1 403 509 7500, F: +1 403 781 1825

“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

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If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the financial statements

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditor’s responsibilities for the audit of the financial statements

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.

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As at

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----- Start of picture text -----

Cash and cash equivalents 358 567 619
Restricted cash 4 319 370 -
Accounts receivable 5 1,111 735 445
Inventories 58 52 34
Property and equipment 6 5,308 4,233 2,684
Accounts payable and accrued liabilities 7 1,649 694 352
Lease liabilities and loans 8 92 451 446
Lease liabilities and loans 8 1,361 1,778 1,371
Deferred income 9 765 - -
Deferred income taxes 15 301 194 98
Share capital 10 38 38 42
Contribution from parent 10 550 - -
Retained earnings 2,398 2,802 1,473
Total shareholders’ equity 2,986 2,840 1,515
----- End of picture text -----

The notes are an integral part of these financial statements.

Commitments 20 Subsequent events 21 Signed Chase Edgelow, Director

Signed Mischa Zajtmann, Director

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For the years ended December 31



venue 11 4,953 st ofgoods sold 1,924	4,647 1,571
ss profit 3,029 erating costs 1,100 neral and administrative expenses 12 510 preciation 6 319 ance costs (income), net 13 113 er income(expense),net 14 (58)	3,076 455 280 239 128 -
expense 15 249	445

16

The notes are an integral part of these financial statements.

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----- Start of picture text -----

Balance, January 1 10 38 42
Repurchase of class B common shares 10 - (4)
- -
Balance, January 1
Capital contribution from parent 10 550 -
Balance, January 1 2,802 1,473
Total comprehensive income 796 1,529
Dividends declared and paid 10 (1,200) (150)
Dividends declared in exchange for loan payable 8,10 - (50)
----- End of picture text -----

The notes are an integral part of these financial statements.

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For the years ended December 31



Net income 796 Items not affecting cash: Depreciation 6 319 Other (income) expense, net 14 (52) Deferred income tax expense 15 108 Changes in non-cash workingcapital 19 822				1,529 239 1 95 46

Expenditures on property and equipment 6 (1,207) Government grant received on facility expansion 9 765 Restricted cash 4 51 Changes in non-cash workingcapital 19 (249)				(919) - (370) (12)

Repayment of principal portion of lease liabilities 8 (233) Exercise of lease purchase option 8 (32) Proceeds from loans received 8 60 Repayment of loans 8 (707) Capital contribution 10 550 Repurchase of class B common shares 10 - Dividends declared andpaid 10 (1,200)				(205) - 4 (306) - (4) (150)

(209) Cash,beginningofyear 567				(52) 619

The notes are an integral part of these financial statements.

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Sea to Sky Soils and Composting Inc. (“SSS” or the “Company”) operates a Gore Cover™ organic waste management facility in British Columbia. The Company processes organics, yard waste and biosolids to for a contracted “tipping” fee and produces high-quality organic compost and soils for farmers, gardeners and developers as part of its outbound business. The Company was incorporated under the on January 30, 2012.

On December 31, 2020, the Company completed a plan of arrangement (the “Arrangement”) with EverGen Infrastructure Inc. (“EverGen”) and Net Zero Waste Abbotsford Inc. (“NZWA”) whereby all the issued and outstanding shares of SSS and all the issued and outstanding shares of NZWA were acquired by EverGen. These transactions were accounted for as business combinations.

The Company’s revenue, costs of goods sold and certain operating costs are impacted by seasonal weather variation and the related fluctuations in volumes processed.

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These financial statements are presented in Canadian dollars, the Company’s functional currency, unless otherwise indicated.

These financial statements have been prepared on a historical cost basis, except as detailed in the Company’s accounting policies disclosed in note 3.

The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. These estimates and judgments are based on management’s best understanding of current events and actions that the Company may undertake in the future. Actual results may differ from these estimates and judgments. Estimates and their underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which estimates are revised and for any future years affected.

Significant estimates and judgments used in the preparation of these financial statements are outlined below.

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Property and equipment assets are tested for impairment when events or changes in circumstances indicate that the carrying amount exceeds the recoverable amount.

Management applies judgment in reviewing each of its contractual arrangements to determine whether the arrangement contains a lease. The measurement of lease liabilities and right-of-use (“ROU”) assets incorporates an estimate of lease terms and discount rates. The term of a lease is determined as the noncancellable period of a lease and includes periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option. In considering the option to extend a lease, the Company considers all the relevant facts and circumstances that create an economic incentive to exercise or not exercise the option. The assessment is reviewed if a significant change in circumstances occurs which affects this assessment. Where the rate implicit in a lease is not readily determinable, the discount rate is estimated using a discount rate similar to the Company’s incremental borrowing rate to purchase an asset of similar value, with similar payment terms and security.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement amounts of existing assets and liabilities and their respective tax basis. Estimates of the Company’s future taxable income are considered in assessing the utilization of available tax losses. The calculation of income taxes involves many complex factors including the interpretation of relevant tax legislation and an analysis of the amount of future taxable profits.

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In March 2020, the World Health Organization declared a global pandemic due to Novel Coronavirus (“COVID-19”). COVID-19 has significantly impacted the global economy. The full extent and impact of the COVID-19 pandemic to the Company’s operations and future financial performance is unknown at this time and depends on a number of future developments which are uncertain and unpredictable. These future developments include the duration and spread of COVID-19, its continued impact on capital and financial markets and new information that may emerge concerning the severity of the virus. These uncertainties may continue beyond the determination of how to contain the virus and treatment of those impacted. The ongoing pandemic presents uncertainty and risk to the Company, its performance, and the estimates and assumptions used by management to prepare its financial results.

Revenue from the sale of organic compost and soil is recognized when transfer of control exists, primarily at the transfer of finished goods inventory to the customer.

Finance income is recognized as it accrues using the effective interest rate method.

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Operating costs are comprised of repairs and maintenance, utilities, licenses and permits and property taxes.

Finance costs consists primarily of the interest component of lease payments and interest recognized on loans which is expensed as incurred.

Inventory consists of raw materials, work in progress, and finished goods. Inventory consists of organic and green waste products (“organic feedstock”), compost which is at various stages of decomposition (“work-in-progress”), and various grades of saleable branded compost and soil (“finished goods”).

IFRS 1 allows the recognition of property and equipment in the IFRS opening balance sheet at deemed cost as an alternative to the cost prescribed in International Accounting Standard 16. “ ”. In accordance with IFRS 1, the Company has elected to record the carrying amount of property and equipment as deemed cost at fair value as of the date of transition. An independent valuator was involved in determining fair value. Subsequent to January 1, 2019, property and equipment has been measured at cost less accumulated depreciation and impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the assets and subsequent expenditures to the extent that they can be measured, and future economic benefit is probable. Repairs and maintenance are expensed as incurred.

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Buildings and leasehold improvements Equipment, vehicles and other Right-of-use assets		15 – 25 years 10 – 15 years 2 – 19years

Lease payments are allocated between the liability and finance costs. The finance cost is charged to net income (loss) over the lease term.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in the future lease payments arising from a change in an index or rate, if there is a change in the amount expected to be payable under a residual value guarantee or if there is a change in the assessment of whether the Company will exercise a purchase, extension or termination option that is within the control of the Company. When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the ROU asset or is recorded in net income (loss) if the carrying amount of the ROU asset has been reduced to zero.

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the underlying asset; less any lease payments made at or before the commencement date. The ROU asset may be adjusted for certain remeasurements of the lease liability and impairment losses.

Leases that have a term of less than twelve months or leases on which the underlying asset is of low value are recognized as an expense in net income (loss) over the lease term.

A lease modification will be accounted for as a separate lease if the modification increases the scope of the lease and if the consideration for the lease increases by an amount commensurate with the standalone price for the increase in scope. For a modification that is not a separate lease or where the increase in consideration is not commensurate, at the effective date of the lease modification, the Company will remeasure the lease liability using the Company’s incremental borrowing rate, when the rate implicit to the lease is not readily available, with a corresponding adjustment to the ROU asset. A modification that decreases the scope of the lease will be accounted for by decreasing the carrying amount of the ROU asset, and recognizing a gain or loss in net income (loss) that reflects the proportionate decrease in scope.

If the recoverable amount is less than the carrying amount, an impairment loss is recognized immediately in net income (loss).

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remote. Contingent assets are not recognized but are disclosed when an inflow of economic benefits is probable.

Deferred tax is recognized in respect of temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is determined on a non-discounted basis using tax rates and laws that have been enacted or substantively enacted at the balance sheet date and are expected to apply when the deferred tax asset or liability is settled. Deferred tax assets are recognized to the extent that it is probable that the future taxable profits will be available against which they can be utilized. The carrying amount of a deferred tax asset is reviewed at the end of each reporting period. The Company reduces the carrying amount of a deferred tax asset to the extent that it is no longer probable that sufficient taxable income will be available to allow the benefit of part or all of these deferred tax assets to be utilized.

Common shares are classified as equity. Incremental costs directly attributable to the issuance of shares are recognized as a deduction from equity. Dividends are accrued when declared by the board of directors.

The Company’s financial assets consist of cash and cash equivalents and accounts receivable. The Company’s financial liabilities consist of accounts payable and accrued liabilities, lease liabilities and loans.

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of the financial asset. Financial liabilities are subsequently measured at amortized cost or FVTPL. Amortized cost is calculated by taking into account any issue costs. Interest expense is recognized in net income (loss).

The Company characterizes its fair value measurements into a three-level hierarchy depending on the degree to which the inputs are observable as follows:

Level 1 inputs are quoted prices in active markets for identical assets and liabilities;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.

Financial assets and liabilities are not offset unless the Company has the current legal right to offset and intends to settle on a net basis or settle the asset and liability simultaneously.

Related party transactions are accounted for at the exchange amount which is the amount agreed upon

between the parties.

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements include:

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Amendments to IFRS 9 “ , IFRS 7 , IFRS 4 “ ” and IFRS 16 for the IASB
publication “Interest Rate Benchmark Reform”, which provides clarity on the changes after the reform of an interest rate benchmark. The amendments primarily relate to the modification of financial instruments, allowing for a practical expedient for modifications required by the reform.
International Accounting Standard 1 , (“IAS 1”) has been amended to clarify how to classify debt and other liabilities as either current or non-current. The amendment to IAS 1 is effective for the years beginning on or after January 1, 2023.

The Company intends to adopt these standards and interpretations when they become effective and is currently assessing the impact of these amendments.

The Company’s restricted cash of $319 at December 31, 2020 (December 31, 2019 - $567) is held in restricted term deposits as required by the Organic Infrastructure Program, note 9.

Trade receivables	658	739	447
Organic Infrastructure Program receivable (note 9)	447	-	-
Other	12	-	-
Credit loss allowance	(6)	(4)	(2)

The Company was awarded a federal grant of $765 under the Organic Infrastructure Program for the expansion of its organic waste facility (note 9). A portion of the grant, $447 is recorded in accounts receivable at December 31, 2020 and is collateralized.

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January 1, 2019 603 1,214 867 2,684 Additions 656 263 869 1,788	January 1, 2019 603 1,214 867 2,684 Additions 656 263 869 1,788
At December 31, 2019 1,259 1,477 1,736 4,472 Additions 1,042 165 187 1,394 Exercise of leasepurchase option - 382 (382) -


January 1, 2019 - - - - Depreciation 39 98 102 239
At December 31, 2019 39 98 102 239 Depreciation 87 122 110 319 Exercise of leasepurchase option - 75 (75) -


At January 1, 2019 603 1,214 867 2,684 At December 31, 2019 1,220 1,379 1,634 4,233

The Company’s ROU assets include lease contracts for land on which it operates and equipment which is used in operations.

As at December 31, 2020 and December 31, 2019, there were no indicators of impairment related to the Company’s property and equipment.

Trade payables and accrued liabilities	1,276	265	197
Corporate taxes payable	147	350	127
Other liabilities	226	79	28

At December 31, 2020, trade payables and accrued liabilities includes $550 for an accrual related to a regulatory compliance related matter

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The Company has lease liabilities and loans consisting of the following:

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----- Start of picture text -----

Lease liabilities 1,453 1,531 867
Loans - 698 950
As at January 1, 2019 867
Additions 869
Interest expense (note 13) 79
Lease payments (284)
As at December 31, 2019 1,531
Additions 187
Interest expense (note 13) 82
Lease payments (315)
Exercise of lease purchase option (32)
As at December 31, 2020
Less current portion
Long-term portion
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The Company has no variable lease payments and no short-term leases.

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January 1, 2019 741 208 949 Advance in lieu of dividend payment (note 10) - 50 50 Advance - 4 4 Principal repayment (127) (179) (306)	January 1, 2019 741 208 949 Advance in lieu of dividend payment (note 10) - 50 50 Advance - 4 4 Principal repayment (127) (179) (306)	January 1, 2019 741 208 949 Advance in lieu of dividend payment (note 10) - 50 50 Advance - 4 4 Principal repayment (127) (179) (306)	January 1, 2019 741 208 949 Advance in lieu of dividend payment (note 10) - 50 50 Advance - 4 4 Principal repayment (127) (179) (306)
At December 31, 2019 614 83 697 Advances 60 - 60 Principal repayment (654) (53) (707) Loan forgiveness (note 14) (20) - (20) Loss(gain)on debt extinguishment(note 14) - (30) (30)
		-

The Company’s loans and borrowings relate to the following facilities:

As at January 1, 2019, the Company had $741 outstanding on a term loan facility with an original loan value of $850. The term loan facility bears interest at prime plus 1.50 percent per annum, had an original term of five years and was subject to various operational and financial covenants. The term loan facility was repaid in full as at December 31, 2020. The facility was cancelled subsequent to December 31, 2020.

The Company had a credit facility of $350 to be used for working capital and general purposes. The credit facility bears interest at prime plus 1.50 percent and is due on demand. No amounts were drawn under this facility as at and during the year ended December 31, 2020 (2019 - $nil). The facility was cancelled subsequent to December 31, 2020.

The Company has unsecured non-interest-bearing loans with related parties. The loans payable to related parties had no fixed repayment terms and were due on demand. The non-interest-bearing loans payable to related parties were repaid during the year ended December 31, 2020.

During the year ended December 31, 2020, the Company repaid loans with a face value of $83 for cash of $53 resulting in a gain on debt extinguishment of $30 (2019 – $nil).

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In 2019, the Company was awarded a federal grant under the Organic Infrastructure Program. The grant is conditional on the expansion of the Company’s existing facility. The Company received $318 during the year ended December 31, 2020 and an additional $447 is included in accounts receivable at December 31, 2020. The grant proceeds of $765 is included in deferred income at December 31, 2020 and will be amortized into income over the estimated useful life of the facility once the expansion is complete.

SSS operates its facility on a site hosted by and leased from the Lil’Wat Nation and employs individuals from the Lil’Wat Nation. During 2020 and 2019, SSS benefited from a Lil’Wat Nation payroll grant. This grant is recorded as a reduction of SSS’s cost of goods sold of $29 in the year ended December 31, 2020 (2019 - $17). The grant relates directly to the employment and education of Lil’Wat Nation members.

During the year ended December 31, 2020, the Company received $33 of other government assistance (2019 - $nil), of which $30 has been recorded as a reduction in cost of goods sold and $3 as a reduction in general and administrative, consistent with the eligible labour costs.

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The Company has authorized an unlimited number of class A and class B common shares.

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As at January 1, 2019	4,167	42
Repurchase of class B common shares	(417)	(4)
As at December 31,2019	3,750	38
As at December 31,2020

On November 7, 2019, the Company repurchased the outstanding class B common shares for $0.01 per share.

The Company declared and paid dividends of $1,200 during the year ended December 31, 2020 (2019 - $150). During the year ended December 31, 2019, the Company issued notes payable to related parties with a face value of $50 in lieu of dividends of $50 (note 8).

On December 31, 2020, the issued and outstanding shares were acquired by EverGen.

During the year ended December 31, 2020, the Company received a capital contribution of $550 from EverGen which was used to repay outstanding loans (note 8).

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Tipping fees	3,281	3,047
Organic compost and soil sales	903	900
Truckingservices	769	700

Tipping fee income includes the disposal of biosolids and organic waste.

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Salaries and wages	360	153
Professional and consulting fees	37	40
Other	113	87

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Interest expense on lease liabilities (note 8)	82	79
Interest expense on loans (note 8)	25	37
Other	16	12
Interest income	(10)	-

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Gain (loss) on debt extinguishment (note 8)	30	-
Other	28	-

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The Company recognized the following income taxes:

Current tax	142	350
Deferred tax expense	107	95

The provision for income taxes differs from the amount which would be expected by applying the	The provision for income taxes differs from the amount which would be expected by applying the	The provision for income taxes differs from the amount which would be expected by applying the
combined federal and provincial statutory income tax rates to net income before tax.
The following table reconciles income taxes calculated at	the statutory rate with the recorded income
taxes:
Net income before income tax	1,045	1,974
Statutoryincome tax rate(percent)	27.0	27.0
Expected income tax expense at statutory rate	282	533
Effect on taxes resulting from:
Non-deductible expenses	4	2
Other	(37)	(90)

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The temporary differences that give rise to the deferred income tax assets and liabilities are as follows:

	Balance at		Balance at
	December 31,	Recognized in	December 31,
	2019	net income	2020
Deferred income tax liabilities
Propertyand equipment	608	85	693
	608	85	693
Deferred income tax assets
Lease liabilities	(413)	21	(392)
Other	(1)	1	-
	(414)	22	(392)

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	Balance at		Balance at
	January 1,	Recognized in	December 31,
	2019	net income	2019
Deferred income tax liabilities
Propertyand equipment	332	276	608
	332	276	608
Deferred income tax assets
Lease liabilities	(234)	(179)	(413)
Other	-	(1)	(1)
	(234)	(180)	(414)

At December 31, 2020 the Company has approximately $2,700 of tax pools available for future deduction against taxable income (December 31, 2019 - $1,980).

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The calculation of basic and diluted net income and comprehensive net income per share for the year ended December 31, 2020 was based on the net income and comprehensive net income attributable to common shareholders of $796 (2019 - $1,529) and the weighted-average number of common shares outstanding during the year. Basic and diluted net income and comprehensive net income for the year ended December 31, 2020 was $0.21 per share (2019 - $0.37 per share).

The weighted-average number of common shares outstanding during the year was calculated as follows:

Issued common shares at beginning of year	3,750	4,167
Repurchase of class B common shares	-	(63)

The Company had no dilutive instruments outstanding for the years ended December 31, 2020 and December 31, 2019.

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Lease liabilities and loans are initially measured at fair value and carried at amortized cost. The fair value of the lease liabilities and loans payable to third parties approximates their carrying value due to the specific non-tradeable nature of these instruments. The estimated fair value of the loans payable to related parties has been determined based on the estimated terms to maturity and discount rates of a promissory note

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issued to a third party (level 3). The fair value of the loans payable to related parties approximates the carrying value due to no fixed terms of repayment and the loans are due on demand.

The Company’s activities expose it to certain financial risks, including market risk, credit risk and liquidity risk.

Credit risk is the risk that the counterparty to a financial asset will default, resulting in the Company incurring a financial loss. The Company’s credit risk is concentrated with a few customers, primarily municipal governments. During the year ended December 31, 2020, the Company had two customers who represented 72 percent of revenue (2019 – two customers who represented 72 percent). At December 31, 2020, three customers represented 90 percent of accounts receivable (December 31, 2019 – three customers represented 87 percent of accounts receivable). Accounts receivable includes $447 of which is collateralized.

The Company submitted a request for proposal for the City of Vancouver’s North Shore Transfer Station related to organics management. The request for proposal was for contracts expiring on June 30, 2021 which are currently held by the Company for both tipping and trucking of organic waste. During the year ended December 31, 2020, these contracts accounted for 70 percent of the Company’s revenue. On April 16, 2021, the Company was notified that this contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee. See additional information in note 22.

Management uses a provision matrix based upon historical default rates and forward-looking assumptions to calculate expected credit losses and establish a provision for ECLs. The Company’s historical bad debt expense has not been significant and is usually limited to specific customer circumstances. Management considers the credit worthiness of counterparties and past payment history as well as amounts past due. Management regularly monitors customers payments and considers all amounts greater than 60 days to be past due. At December 31, 2020, approximately 20 percent of trade receivables were past due but not considered impaired (December 31, 2019 – 5 percent). The maximum exposure to credit risk related to trade receivables is their carrying value as disclosed in these financial statements. There have been no changes in the assumptions used to determine the provision for ECL during the year ended December 31, 2020.

The Company held cash and cash equivalents of $677 at December 31, 2020 (December 31, 2019 - $937) which represents its maximum credit exposure on these assets. The cash is held with major financial institution counterparties and management believes credit risk is minimal.

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resources to meet its liquidity requirements at any point. The Company achieves this by managing its capital spending and maintaining sufficient funds for anticipated short-term spending.

The expected timing of cash outflows relating to financial liabilities on balance sheet as at December 31, 2020 are:

Accounts payable
and accrued liabilities	1,649	-	-	-	-	-	1,649
Leasepayments(1)	173	173	173	164	121	1,370	2,174

The Company anticipates that its existing capital resources will be adequate to satisfy its liquidity requirements over the next 12 months.

The capital structure of the Company consists of the following:

Lease liabilities and loans	1,453	2,229	1,817
Shareholders’ equity	2,986	2,840	1,515

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The value of compensation and other fees paid to board of directors and members of executive management of the Company is as follows:

Salaries and benefits 462 260

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The Company had no revenue earned from related parties during the year ended December 31, 2020 (2019 - $nil).

The exchange value of expenses paid to related parties of the Company is as follows:

Expenses 770 689

Expenses paid to related parties during the year ended December 31, 2020 include $763 for trucking services (2019 - $683) which are included in cost of goods sold. The entity is related to the Company due to a member of SSS’s key management personnel being a director and controlling shareholder of the vendor providing the trucking services. Other expenses of $7K were paid to related parties during the year ended December 31, 2020 (2019 - $6). During the year ended December 31, 2020, the Company reimbursed an entity under common ownership for general and administrative expenses incurred on behalf of the Company of $36 (2019 - $26).

The Company has the following amounts included in accounts payable and accrued liabilities which are owing to related parties:

1210366 BC Ltd.(1)	174	110	-
Net Zero Waste Abbotsford Inc.	9	27	79

The following table reconciles the net changes in non-cash working capital from the statements of financial position to the statements of cash flows:

Net changes in non-cash working capital:
Accounts receivable	(376)	(290)
Inventories	(6)	(18)
Accountspayable and accrued liabilities	955	342
Net changes in non-cash working capital:
Operating activities	822	46
Investingactivities	(249)	(12)
Interest paid	107	127
Taxespaid	129	354

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The following table reconciles the movement in cash flows arising from financing activities:

Balance, beginning of year	1,531	867
Additions	187	869
Principal repayments	(233)	(205)
Exercise of leasepurchase option	(32)	-

Balance, beginning of year	697	949
Advances	60	4
Principal repayments	(707)	(306)
Loss (gain) on debt forgiveness	(30)	-
Non-cash exchange of dividend payable for loan payable	-	50
Non-cash loan forgiveness	(20)	-

Balance, beginning of year	38	42
Repurchase of class B common shares	-	(4)

Balance, beginning of year	-	-
Cash contribution	550	-


Balance, beginning of year	-	-
Dividends declared	1,200	200
Dividends paid	(1,200)	(150)
Non-cash exchange of dividendpayable for loanpayable	-	(50)

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The Company has no outstanding contractual obligations or commitments at December 31, 2020.

The Company believes that the accruals for tax liabilities are adequate for all open tax years based on the assessment of many factors, including interpretations of tax law and prior experience.

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Cash and cash equivalents 619 - 619
Accounts receivable a 447 (2) 445
Inventories 34 - 34
Property and equipment b,c 1,327 1,357 2,684
Accounts payable and accrued liabilities 352 - 352
Lease liabilities and loans c 336 110 446
Lease liabilities and loans c 614 757 1,371
Deferred income taxes d - 98 98
Share capital 42 - 42
Retained earnings 1,083 390 1,473
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Cash and cash equivalents 937 - 937
Accounts receivable a 739 (4) 735
Inventories 52 - 52
Property and equipment b,c 1,867 2,366 4,233
Accounts payable and accrued liabilities 694 - 694
Lease liabilities and loans c 211 240 451
Lease liabilities and loans c 239 1,539 1,778
Deferred income taxes d - 194 194
Share capital 38 - 38
Retained earnings 2,413 389 2,802
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4,647 ds sold 1,571		- -	4,647 1,571
	4,647
	1,571
osts c administrative expenses n b,c ts b	3,076	-	3,076 455 280 239 128

	490	(35)
	278	2
	379	(140)
	49	79
e	1,880	94	1,974 445
	350	95

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In accordance with IFRS, management recognizes loss allowances for ECLs on its financial assets measured at amortized cost.

In accordance with IFRS, management elected to record the carrying amount of property and equipment as deemed cost at fair value as at the date of transition to IFRS. As a result, the carrying value of property and equipment was increased by $491 at January 1, 2019. In addition, management changed the depreciation method from declining balance to straight-line over the estimated useful life of the underlying asset. The impact of the increase in fair value and change in depreciation methods resulted in a net decrease in depreciation expense of $242.

Under ASPE, leases were classified as operating and financing leases. In accordance with IFRS, the Company removes the classification of leases as either operating or financing leases, effectively treating all leases as finance leases. Certain short-term leases (less than 12 months) and leases of low-value assets are exempt from the recognition requirements of IFRS and are expensed as incurred in net income (loss). The impact of this change in classification is to increase ROU assets which are included as a component of property and equipment and increase lease liabilities on the date of transition by $869. In addition, depreciation expense and finance costs increased by $102 and $79, respectively and operating costs decreased by $35 for the year ended December 31, 2019.

The above changes resulted in an increase of $194 to the deferred tax liability at December 31, 2019. The deferred tax liability was calculated based on a tax rate of 27.0 percent.

The Company submitted a request for proposal, specifically No. 20-016, for the City of Vancouver’s North Shore Transfer Station five-year contract related to organics management. The request for proposal was for contracts expiring June 30, 2021 and currently held by the Company for both tipping and trucking of organic waste. During the year ended December 31, 2020, these contracts accounted for 70 percent of the Company’s revenue. On April 16, 2021, the Company was notified that this material contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

BASIS OF PRESENTATION AND DESCRIPTION OF THE COMPANY

July 5, 2021 - The following Management’s Discussion and Analysis (“MD&A”) of financial condition and results of operations for EverGen Infrastructure Corp. (“EverGen” or “the Company” which includes references to “we”, “our”, “us”, “its”), is a review of the operations, current financial position and condition for the three month period ended March 31, 2021 and should be read in conjunction with the Company’s unaudited interim consolidated financial statements for the period ended March 31, 2021 and the audited consolidated financial statements and related notes as at December 31, 2020 and for the period from incorporation on May 13, 2020 to December 31, 2020.

The consolidated financial statements of EverGen have been prepared in thousands of Canadian dollars, in accordance with International Accounting Standard 34, Interim Financial Reporting , using accounting policies consistent with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board ("IASB"), except where indicated otherwise. This MD&A and the unaudited interim consolidated financial statements of EverGen have been prepared by management and approved by the board of directors as of July 5, 2021.

READER ADVISORIES

COMPANY OVERVIEW AND STRATEGY

EverGen commenced operations on incorporation date of May 13, 2020. The Company is a sustainable infrastructure platform and currently owns and operates organic waste processing facilities which also provide organic feedstock for the planned development of RNG infrastructure projects.

The Company completed the acquisition of Net Zero Waste Abbotsford Inc. (“NZWA”) and Sea to Sky Soils and Composting Inc. (“SSS”) on December 31, 2020. The Company operates two such organic waste conversion facilities in British Columbia, which primarily process inbound organics, yard waste and biosolids for a contracted tipping fee and produces high-quality organic compost and soils for farmers, gardeners and developers as part of its outbound business. The majority of the revenue currently earned by EverGen is sourced under long-term contracts with local municipalities. From this existing platform, EverGen plans to initiate the development of RNG facilities and to produce RNG under long term contracts to Fortis BC and other creditworthy buyers.

Effective April 16, 2021, EverGen acquired all of the issued and outstanding shares of Fraser Valley Biogas Ltd. (“FVB”), pursuant to a share purchase agreement dated April 16, 2021. The Company paid an aggregate amount of $11,500 comprised of $10,500 cash consideration and $1,000 of share consideration. FVB owns and operates a biogas facility in Abbotsford, British Columbia which sells RNG under a longterm contract with Fortis BC. EverGen used a portion of the net proceeds from the March 18, 2021 Special Warrant Financing and funds from the March 17, 2021 credit facility to fund the acquisition of FVB.

EverGen plans to begin construction on the anaerobic digester at its Net Zero Waste Abbotsford facility later this year. Upon regulatory approval and completion, EverGen expects to start supplying FortisBC with RNG by the end of 2022.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Progressing the development and construction of existing portfolio of RNG expansion projects;
Optimization, diversification and expansion of existing organic waste processing capabilities (RNG feedstock);
Continuing the growth of its project portfolio via strategic acquisitions and consolidation opportunities; and
Developing strategic partnerships and advance RNG project pipeline.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

FINANCIAL AND OPERATIONAL HIGHLIGHTS

On December 31, 2020, EverGen acquired NZWA and SSS. The acquired assets and liabilities are reflected in EverGen’s total assets and total long-term liabilities as of December 31, 2020 and the results of operations for NZWA and SSS are consolidated in EverGen’s consolidated results of operations commencing on January 1, 2021.

Both NZWA and SSS were private companies earning revenue from the receipt of organic waste at their respective facilities, primarily from municipal customers under contracted tipping agreements. The organic waste facilities are designed and permitted to accept most forms of organic waste from residential, commercial and industrial sources.

This MD&A includes a review and analysis of the consolidated operations of EverGen which includes the operations of both of its wholly-owned subsidiaries, NZWA and SSS for the three month period ended March 31, 2021. All of the issued and outstanding shares of NZWA and SSS were purchased on December 31, 2020, and as a result the comparative information presented in this MD&A is limited to the period from EverGen’s commencement of operations and incorporation on May 13, 2020 to December 31, 2020. NZWA and SSS are considered to be predecessor companies of EverGen under securities law and accounting regulations. As such, for additional comparative information for both NZWA and SSS, refer to their respective stand-alone audited financial statements for the year ended December 31, 2020 as filed on www.sedar.com.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

FINANCIAL AND OPERATIONAL HIGHLIGHTS

Three months ended March 31, 2021	Three months ended March 31, 2021
FINANCIAL
Revenue Net income (loss) Net income (loss) per share ($), basic and diluted EBITDA(1) Adjusted EBITDA(1) Capital expenditures Total assets Total long-term liabilities	1,585 (1,158) ($0.13) (960) 203 146 61,912 14,347
OPERATING
Incoming organic feedstock (tonnes) Organic compost and soil sales(yards) (2)	17,164 7,087

(1) Non-GAAP measure as defined in the Non-GAAP measures of this MD&A.

(2) Organic compost and soil sales includes both finished and unfinished product sales and by-products.

RESULTS OF OPERATIONS

Revenue

Three months ended March 31, 2021	Three months ended March 31, 2021
Tipping fees Organic compost and soil sales Other	1,255 195 135
Total	1,585

Revenue is generated primarily through contracted tipping fees charged to municipalities and other customers for the disposal of organic waste at the Company’s waste management facilities which use a Gore Cover™ system. EverGen also generate revenues from the sale of high-quality organic compost and soils, and from hauling services associated with delivering organic waste to its SSS facility. The Company’s revenue is exposed to fluctuations as a result of the inherent seasonality of organic waste processing and the sale of organic compost and soil with increased seasonal demand in the second quarter.

EverGen generated $1,585 of revenue during the first quarter of 2021 including $1,255 tipping fees from 17,164 tonnes of incoming organic feedstock and $195 from 7,087 yards of organic compost and soil sales.

Cost of goods sold

Three months ended March 31, 2021	Three months ended March 31, 2021
Cost ofgoods sold	597

Cost of goods sold is comprised of direct and indirect costs, including handling, labour, fuel charges and hauling costs where required, associated with organic feedstock collection and the preparation and the process of screening, blending and curing the feedstock for conversion into saleable organic compost and soil. The Company’s cost of goods sold is exposed to fluctuations as a result of seasonal weather variation and the related fluctuations in volumes processed.

Cost of goods sold of $597 for the first quarter of 2021 includes $340 of labour costs, $94 of fuel charges and $118 of SSS hauling costs.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Gross profit

	Three months ended March 31, 2021	Three months ended March 31, 2021
Grossprofit		988
% of revenue		62

The Company’s 62 percent gross profit as a percentage of revenue for the first quarter of 2021 is comparable to the acquired businesses’ stand-alone annual 2020 gross profit percentages of revenue. In 2020, NZWA and SSS had gross profits as a percentage of revenue of 60 percent and 61 percent, respectively.

Operating costs

	Three months ended March 31, 2021	Three months ended March 31, 2021
Operatingcosts		222

Operating costs are comprised primarily of repairs and maintenance, licenses and permits and property taxes. Certain operating costs of the Company are exposed to fluctuations as a result of seasonal weather variation and the related fluctuations in volumes processed.

Operating costs of $222 for the first quarter of 2021 include $71 of repairs and maintenance and $99 of equipment rental with increased volumes being processed in the quarter.

General and administrative expenses

	Three months ended March 31, 2021	Three months ended March 31, 2021
General and administrative expenses		1,246

General and administrative expenses consist of labour and related benefits costs, professional and consulting fees and other general and administrative expenses.

The Company’s general and administrative expenses of $1,246 for the first quarter of 2021 include $683 of one-time professional, legal and consulting fees related to the integration of acquisitions, implementation of processes and in preparation of readying EverGen as a potential reporting issuer and public filer.

Operating profit

Three months ended March 31, 2021	Three months ended March 31, 2021
Operating profit(loss)	(480)

Operating profit is measured as gross profit, an additional subtotal found in the statement of net income and comprehensive net income, less operating costs and general and administrative expenses and is a non-GAAP measure as defined in the non-GAAP measures section of this MD&A. Management uses this measure to evaluate the efficiency of its operations and considers it to be a key measure of profitability.

During the first quarter of 2021, EverGen had a negative operating profit of $480 primarily due to $683 of one-time professional, legal and consulting fees related to the integration of acquisitions, implementation of processes and in preparation of readying EverGen as a potential reporting issuer and public filer included in general and administrative expenses.

Depreciation and amortization

Three months ended March 31, 2021	Three months ended March 31, 2021
Depreciation Amortization	204 388

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Total 592

Depreciation is recognized on property and equipment including right-of-use assets related to lease contracts. Amortization is recognized on the intangible assets including brands, and customer contracts and stakeholder relationships.

Depreciation and amortization on the NZWA and SSS assets acquired at December 31, 2020 commenced on January 1, 2021 and the Company recorded $204 and $388 of depreciation and amortization, respectively, for the first quarter of 2021.

Share-based payment expense

	Three months ended March 31, 2021	Three months ended March 31, 2021
Share-basedpayment expense		413

Share-based payment expense include various non-cash incentive programs awarded to founders and advisors of EverGen as consideration for services rendered or recognition of incremental fair value of share capital issued.

On December 31, 2020, EverGen adopted a Performance Share Unit Plan (“PSU Plan”) and granted 600,000 performance share units (“PSUs”) to the directors and officers of the Company. While the number of PSUs outstanding will count towards the maximum number of common shares reserved under the Equity Incentive Plan, no additional PSUs can be granted under the Equity Incentive Plan or the PSU Plan.

On March 18, 2021, the Company adopted the Equity Incentive Plan, which provides for the grant of the following equity-based compensation awards: (i) stock options (“Options”); (ii) restricted share units (“RSUs”) and (iii) deferred share units (“DSUs”).

The purpose of the Equity Incentive Plan is to advance the interests of the Company by providing an incentive to the directors, officers, employees and certain consultants of the Company, and any of its subsidiaries (including any acquired businesses) and affiliates, if any, to align growth objectives of the Company and participants, to associate a portion of the participants’ compensation with the Company’s long term performance and to attract to and retain in the employment of the Company or any of its subsidiaries, persons of experience and ability, by providing them with the opportunity to acquire an increased proprietary interest in the Company through the acquisition of common shares.

In addition, on March 18, 2021, the Company granted (i) 195,000 Options to officers, an employee and consultants of the Company; (ii) 17,500 RSUs to an officer and consultants of the Company; and (iii) 27,500 DSUs to its directors.

The total number of PSUs, Options, RSUs and DSUs that can be granted pursuant to the Equity Incentive Plan is equal to 20 percent of the issued and outstanding Common Shares (on a non-diluted basis) calculated as of the date the Company is listed on the TSX Venture Exchange.

EverGen recorded share-based payment expense of $413 for the first quarter of 2021 related to its Equity Incentive Plan and PSU Plan.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Finance costs (income), net

	Three months ended March 31, 2021	Three months ended March 31, 2021
Finance costs(income),net		107

Finance costs (income), net consist primarily of the interest expense component of lease payments, interest expense recognized on loans payable, interest income on cash balances as well as other financing costs. Finance costs (income), net of $107 for the first quarter of 2021 are primarily due to the Company’s interest expense on lease liabilities and financing costs incurred entering into its credit facility.

Other income (expense), net

Three months ended March 31, 2021	Three months ended March 31, 2021
Transaction costs	67

Transaction costs of $67 related to prospective acquisitions have been expensed by EverGen for the three months ended March 31, 2021.

Income taxes

	Three months ended March 31, 2021	Three months ended March 31, 2021
Current tax expense (recovery) Deferred tax expense(recovery)		(81) (420)
Total tax expense(recovery)		(501)

Income taxes consist of current and deferred income taxes.

The total tax recovery of $501 in the first quarter of 2021 is mainly due to non-recurring expenses related to the integration of acquisitions, implementation of processes and in preparation of readying EverGen as a potential reporting issuer and public filer. These expenditures effectively reduce taxable income and create non-capital losses in the quarter that the Company may utilize against future taxable income.

EBITDA and Adjusted EBITDA

Three months ended March 31, 2021	Three months ended March 31, 2021
EBITDA	(960)
Adjusted EBITDA	203

EverGen’s negative EBITDA of $960 in the first quarter of 2021 is primarily due to non-recurring professional, legal and consulting fees included in general and administrative expenses as described above.

EverGen’s adjusted EBITDA of $203 in the first quarter of 2021 has been adjusted for $413 of share-based payment expense, $67 transaction costs and $683 of one-time professional, legal and consulting fees included in general and administrative expenses related to the integration of acquisitions, implementation of processes and in preparation of readying EverGen as a potential reporting issuer and public filer.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

CAPITAL EXPENDITURES

	Three months ended March 31, 2021	Three months ended March 31, 2021
Capital expenditures		146

Capital expenditures include purchases of property and equipment used in operations. During the first quarter of 2021, EverGen incurred capital expenditures of $146 as the Company replaced an engine on the green waste shredder and added other equipment to its facilities, and made other leasehold improvements as part of its SSS facility expansion.

SUPPLEMENTAL QUARTERLY INFORMATION

The table below summarizes EverGen’s quarterly financial and operational highlights from incorporation[(1)] :

		2021 2020
		Mar 31 Dec 31 Sep 30 Jun 30
		Q1 Q4 Q3 Q2(2)
FINANCIAL
Revenue Net income (loss) Net income (loss) per share ($), basic and diluted EBITDA(3) Adjusted EBITDA(3) Capital expenditures Total assets Total long-term liabilities		1,585 - - - (1,158) (2,227) (5) (1) (0.13) (6.69) (2,142.16) (2.73) (960) (2,515) (6) - 203 - - - 146 34,042(4) - - 61,912 50,510 104 - 14,347 8,780 100(5) -
OPERATING
Incoming organic feedstock (tonnes) Organic compost and soil sales(yards)		17,164 - - - 7,087 - - -

(1) Includes results from the date of incorporation on May 13, 2020.

(2) Period from incorporation on May 13, 2020 to June 30, 2020.

(3) Non-GAAP measure as defined in the Non-GAAP measures section of this MD&A.

(4) Includes the acquisition of NZWA and SSS at December 31, 2020 for cash consideration of $24,498, contingent consideration of $5,655 and 777,777 common shares in EverGen valued at $5.00 per common share on the acquisition date.

(5) Includes $100 of convertible notes exchanged for funds advanced by founder shareholders.

EverGen was incorporated on May 13, 2020.

During the periods from May 13, 2020 to December 31, 2020, EverGen earned no revenue from its operations with activities focused on establishing a sustainable infrastructure platform and for the acquisitions of NZWA and SSS. The Company incurred net losses for the periods from May 13, 2020 to March 31, 2021 primarily due to non-reoccurring general and administrative expenses related to one-time professional fees, transaction costs for the acquisition of NZWA and SSS as well as other planned acquisitions, and share-based payment expenses.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

CONSOLIDATED LIQUIDITY AND CAPITAL RESOURCES

The following discussion relates to the consolidated position of liquidity and capital of EverGen as at March 31, 2021.

At March 31, 2021, EverGen had cash and cash equivalents of $14,095 (December 31, 2020 - $4,684), restricted cash of $2,819 (December 31, 2020 - $319) and a working capital surplus of $11,579 (December 31, 2020 - $2,842 deficit) and is primarily due to the proceeds from the equity issuance and debt advanced in the first quarter of 2021.

Credit facilities

On March 17, 2021, EverGen entered into a credit facility arrangement with a Canadian lender, providing for a senior secured term loan up of to $7,000, repayable over a term of three years bearing interest at a rate of Canadian Variable Rate plus 3.0 percent per annum. The credit facility is secured by the assets of the Company and its subsidiaries.

As at March 31, 2021, $7,000 was drawn against the credit facility.

The credit facility agreement is subject to the following covenants:

Maintain a consolidated working capital ratio equal to or greater than 1.20:1 at all times;
Maintain a consolidated “fixed charge coverage ratio” as defined in the agreement equal to or greater than 1.20:1 at all times, tested quarterly on a rolling four quarters basis;
Maintain a consolidated “total funded debt to EBITDA ratio” as defined in the agreement equal to or less 3.00 at all times, tested quarterly on a rolling four quarters basis; and
Other operational and financial covenants including but not limited to the Company’s ability to pay dividends, incur additional debt, directly or indirectly grant loans or make investments and other such matters.

The Company is in compliance with all covenants as at March 31, 2021.

As at July 5, 2021, $6,808 was drawn against the credit facility.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Share capital

The Company had the following outstanding common shares and equity instruments at March 31, 2021 and December 31, 2020:

As at (thousands)	March 31, 2021 December 31, 2020	March 31, 2021 December 31, 2020
Common shares(1) Share warrants(2) Share rights Options Performance share units Restricted share units Deferred share units	9,589(1) 911(2) 462 195 600 18 28	8,203 340 462 - 600 - -
Total outstanding securities	11,803	9,605

(1) At March 31, 2021, includes the 1,059,325 Special Warrant Unit Shares classified as equity that will convert to common shares of the Company upon the exercise or deemed exercise on the Automatic Exercise Date.

(2) At March 31, 2021, includes the 529,662 Special Warrant Unit Warrants included in the Special Warrant Financing.

On January 12, 2021, EverGen completed a non-brokered private placement of 254,000 common shares at $5.00 per common share for gross proceeds of $1,270.

In addition, during the three month period ended March 31, 2021, EverGen completed other private placements of 10,000 common shares at $5.00 per common share for gross proceeds of $50.

On January 26, 2021, the Company issued 50,000 common shares with a fair value of $5.00 per common share to an advisor and former shareholder of NZWA as consideration for services rendered in connection with the acquisition of NZWA by EverGen at December 31, 2020. The Company previously recognized $250 of share-based payment expense in connection with the fair value of these services rendered for the period ended December 31, 2020.

On March 18, 2021, the Company issued 13,500 common shares with a fair value of $7.00 per common share for advisor services rendered in connection with the Special Warrant Financing, see share warrants below.

On March 18, 2021, EverGen completed a private placement of 1,059,325 Special Warrants at $8.00 per unit for aggregate gross proceeds of $8,475 (the “Special Warrant Financing”).

Each Special Warrant entitles its holder to receive, upon exercise or deemed exercise, one Special Warrant Unit at no additional cost. Each Special Warrant not previously voluntarily exercised by the holder thereof shall be deemed exercised on behalf of, and without any required action on the part of, the holder thereof, for one Special Warrant Unit on the Automatic Exercise Date.

The Automatic Exercise Date is the earlier of (i) the date which is the third business day following the date on which the Company has obtained a receipt for the final, long prospectus of the Company from the British Columbia Securities Commission, as principal regulator, qualifying the distribution of the Special Warrant Units in qualifying jurisdictions and (ii) the first business day following July 19, 2021, the exercise deadline day.

Each Special Warrant Unit is comprised of:

One Common Share (a “Special Warrant Unit Share”) and
One-half of one Common Share purchase warrant (each whole Common Share purchase warrant, a “Special Warrant Unit Warrant”).

Management determined that the Special Warrants are equity instruments, and EverGen has included the 1,059,325 Special Warrant Unit Shares as part of share capital and included the 529,662 Special Warrant Unit Warrants as part of share warrants.

EverGen determined a fair value of $2.36 per Special Warrant Unit Warrant, and recognized $1,250 of gross proceeds in share warrants and the balance of $7,225 in share capital.

On April 16, 2021, EverGen acquired all of the issued and outstanding shares of Fraser Valley Biogas Ltd., pursuant to a share purchase agreement. The Company paid an aggregate amount of $11,500 comprised of $10,500 cash consideration and issued 125,000 common shares valued at $8.00 per share.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

On April 27, 2021, EverGen completed a non-brokered private placement of 111,111 common shares at $9.00 per common share for gross proceeds of $1,000.

A summary of EverGen’s other equity instruments at March 31, 2021 and December 31, 2020 can be found in note 11 to the unaudited interim consolidated financial statements for the period ended March 31, 2021 and in note 13 to the audited consolidated financial statements for the period from incorporation on May 13, 2020 to December 31, 2020.

On July 5, 2021, the Company had the following outstanding common shares and equity instruments outstanding:

(thousands)
Common shares Share warrants Share rights Options Performance share units Restricted share units Deferred share units	9,825(1) 911(2) 462 195 600 118 28
Total outstanding securities	12,139

(1) Includes the 1,059,325 Special Warrant Unit Shares classified as equity that will convert to common shares of the Company upon the exercise or deemed exercise on the Automatic Exercise Date.

(2) Includes the 529,662 Special Warrant Unit Warrants included in the Special Warrant Financing.

OUTLOOK

Development and construction of existing portfolio of RNG expansion projects;
Optimization and expansion of existing organic waste processing facilities and RNG feedstock;
Securing and optimizing long-term contracts for RNG offtake and feedstock inputs to provide stable low-risk cash flows;
Acquisition of cash flow generating projects for the early generation of working capital;
Secure a strong pipeline of municipal feedstock agreements through developed partnerships and vertically integrated operations;
Diversification of feedstock suppliers to de-risk our inbound revenue streams;
Integration of talent, systems and processes across our acquired projects to create efficiencies and best in class operations; and
Continued growth of project portfolio via strategic acquisitions and consolidation opportunities.

Executing strategic and accretive acquisitions

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

operation and expansion of facilities under a unified business platform. The identification and execution of acquisitions and consolidation opportunities as well as the integration of such into a common operating platform, with shared services and efficiency optimizations, is a key factor to our success. The successful execution of acquisitions opens new markets to EverGen, provides us with additional growth opportunities and drives further procurement and cost synergies across our operations.

Driving cost efficiencies

Building collaborations

ENVIRONMENTAL, SOCIAL AND GOVERNANCE

EverGen intends to deliver on its ESG values as follows:

E – The Company recycles and repurposes organic waste products, expects to produce renewable energy and reduces greenhouse gas emissions;
S – EverGen operates as a community-focused business, receiving and recycling organic waste from local municipalities and businesses and focused on partnering with local First Nations including as hosts for its operations and as workforce participants; and
G – The Company is committed to strong governance practices in its current operations and in planned growth and development of RNG. EverGen is dedicated to developing a sustainable business platform through collaboration with stakeholders, communities, First Nations, employees and contractors, customers and investors and through responsible development, disciplined asset management, financial strength and resiliency and the capacity to operate and grow sustainably.

EverGen is proactively engaging with local businesses, such as restaurants and food and beverage producers and distributors, to advance socially conscious commerce, to create mutually beneficial and socially responsible alternatives to traditional waste disposal and in achieving a reduced carbon footprint. These relationships represent a significant area of growth and diversification from EverGen’s existing customer base and provide the opportunity for market expansion while fulfilling expectations of directing organic waste for recycling and the production of renewable energy.

BUSINESS RISKS

EverGen’s business and financial performance, which includes our results of operations and cash flows, are impacted by a number of risks. For a full understanding of the risks that impact EverGen, the following should be read in conjunction with the Business Risks section of our 2020 annual MD&A. Many of these risks are outside of our control. The risks and uncertainties described below are not the only risks that the Company faces. Additional risks and uncertainties, including those of which management is not currently aware of or which are currently deemed immaterial, may adversely affect the Company. Any of these

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

factors, either alone or taken together, could have a material adverse effect on the Company and could change whether any forward-looking statements are ultimately realized.

Acquisitions risk

Future acquisitions may require significant resources including financial means, which may not result in adequate returns for EverGen’s shareholders.

Customer contracts risk

The majority of revenues earned by EverGen are derived from long-term material contracts with municipalities located in proximity to the Company’s waste processing facilities. During the three months ended March 31, 2021, the Company had five municipal customers who represented 65 percent of revenue. These revenue contracts represent a significant portion of the current revenues reported by the Company. Management does not consider there to be a concentration of risk associated with any one customer.

The Company’s wholly-owned subsidiary, SSS, responded to a request for proposal, specifically No. 20-016, related to organics management at the City of Vancouver’s North Shore Transfer Station for a material contract for both tipping and trucking of organic waste Metro Vancouver. The request for proposal was a competitive process launched to recontract for those contracts expiring June 30, 2021, which are currently held by SSS at the Company’s facility near Whistler, British Columbia. These contracts accounted for 31 percent of EverGen’s revenue (year ended December 31, 2020, these contracts accounted for 70 percent of SSS’s revenue). On April 16, 2021, the Company was notified that this material contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee. Management expects to replace this material contract with revenue from other municipal, commercial or residential sources, the specific timing of which is uncertain.

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EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

The North Shore Transfer Station represents two of the 21 municipalities, less than 10 percent, included under the administration of Metro Vancouver. The remaining municipalities provide EverGen the opportunity for additional municipal contracts beyond or in addition to the North Shore Transfer Station contract.

EverGen is also working in collaboration with local businesses and leading consumer driven businesses to advance the circular economy under new business models targeted at organic waste recycling. These collaborations are part of EverGen’s diversification and extension strategies. These new business models aim to expand and capture additional sources of organic waste for recycling by motivating and fulfilling consumer-driven expectations of organic waste recycling. Accordingly, EverGen’s business model contains a significant expansion of organic waste sourcing from new participants and capture of additional value beyond EverGen’s current sources of revenue.

Initial public offering risk

FINANCIAL RISKS

Credit risk

Credit risk is the risk of loss if purchasers or counterparties default on their financial obligations. The maximum exposure of EverGen to credit risk at March 31, 2021 is limited to cash and cash equivalents and accounts receivable. The Company limits its exposure to credit loss by placing its cash and cash equivalents with high credit quality financial institutions and through the performance of credit checks for new customers. The Company considers its credit risk with respect to accounts receivable to be limited to the value of the provision for allowance for expected credit losses which has been recognized.

EverGen’s customers are primarily municipal governments. At March 31, 2021 the Company has 8 customers who represent 76 percent of EverGen’s accounts receivable (December 31, 2020 – two customers represented 31 percent of account receivable). At March 31, 2021 and December 31, 2020, the Company has $447 of collateralized accounts receivable.

Liquidity risk

F-137

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

The Company enters into leases and contracts that give rise to commitments in the normal course of business for future minimum payments. The Company had the following commitments at March 31, 2021:

< 1 year 1 to 2 years 2 to 3 years	3 to 4 years 4 to 5 years Thereafte r Total
Loan payments (1) 979 936 5,792 Lease liabilities (1) 417 411 383 Service contracts(2) 12 12 5 Consulting services agreements 200 50 - Carbon emission credits – purchase agreement 141 81 58	- - - 7,707 362 302 3,221 5,096 5 4 - 38 - - - 250 - - - 280
Total 1,749 1,490 6,238	367 306 3,221 13,371
(1) Principal and interest (2) Service contracts for leased equipment.

In addition to the above amounts, the Company has annual commitments related to certain of its land leases for utilities and property taxes that fluctuate with usage and assessments, respectively.

Market risk

Market risk is the risk that changes in market conditions, such as interest rates and foreign exchange rates will affect EverGen’s net income (loss) or value of financial instruments.

At March 31, 2021, the Company has fixed interest rates associated with its lease liabilities, thereby substantially reducing the cash flow risk of market fluctuations related to interest rates.

At March 31, 2021, the Company is exposed to interest rate risk with respect to is loans payable. If interest rates were to increase or decrease 50 basis points, the impact on interest expense in net income (loss) for the three month period ended March 31, 2021 would be $1.

F-138

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

ACCOUNTING STANDARDS, CHANGES AND PRONOUNCEMENTS

EverGen’s interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting , using accounting policies consistent with International Financial Reporting Standards as issued by the International Accounting Standards Board. These financial statements are condensed as they do not include all of the information required by IFRS for annual financial statements and therefore should be read in conjunction with the Company’s audited consolidated financial statements for the period from incorporation on May 13, 2020 to December 31, 2020. There were no new or amended accounting standards or interpretations issued during the three months ended March 31, 2021 that are expected to have a material impact on our interim consolidated financial statements.

CRITICAL ACCOUNTING ESTIMATES, JUDGMENTS AND ASSUMPTIONS

A summary of EverGen’s critical accounting estimates and judgments can be found in note 2 to the audited consolidated financial statements for the period from incorporation on May 13, 2020 to December 31, 2020. There have been no significant changes to the use of estimates, judgements or assumptions since December 31, 2020, except as outlined in note 2 to the unaudited interim consolidated financial statements for the three month period ended March 31, 2021.

A summary of significant accounting policies can be found in note 3 to the audited consolidated financial statements for the period from incorporation on May 13, 2020 to December 31, 2020.

DISCLOSURE AND INTERNAL CONTROLS

With the intention of completing an initial public offering and readying EverGen as a venture reporting issuer, the Company has commenced a process to standardize pre-existing control systems at each of the acquired entities and further strengthen EverGen’s internal control environment.

F-139

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

RELATED PARTY TRANSACTIONS

EverGen had the following related party transactions during the three month period ended March 31, 2021:

Key management compensation

The value of compensation and other fees paid to board of directors and members of executive management of EverGen is as follows:

Three months ended March 31, 2021	Three months ended March 31, 2021
Management salaries and other benefits Share-basedpayment expense	178 411
Total	589

At March 31, 2021, $3 is payable to members of executive management as reimbursement of EverGen expenses incurred.

Other related party transactions

The Company incurred office rent expense of $10 included in general and administrative expenses for the three month period ended March 31, 2021 to a private investment firm. A board member and two officers are partners of the firm. The fees were incurred in the normal course of business under the same terms and conditions as transactions with unrelated companies. At March 31, 2021, $nil was payable to the firm.

SUBSEQUENT EVENTS

SSS organics management contract

The Company, through its wholly-owned subsidiary SSS, submitted a request for proposal, specifically No. 20-016, for the City of Vancouver’s North Shore Transfer Station five-year contract related to organics management. The request for proposal was for contracts expiring June 30, 2021, currently held by SSS for both tipping and trucking of organic waste. During the three months ended March 31, 2021, these contracts accounted for 31 percent of EverGen’s revenue (year ended December 31, 2020, these contracts accounted for 70 percent of SSS’s revenue). On April 16, 2021, the Company was notified that this material contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee. Contractual provisions are in place to safeguard EverGen in the event that this contract was not renewed or otherwise offset by new contracts. Under compensation provisions in EverGen’s purchase agreement with the previous shareholders of SSS, this request for proposal outcome may prompt (i) the release to EverGen of $2,000 of performance driven holdbacks paid to the escrow agent in trust during the three month period ended March 31, 2021 and (ii) the release of encumbrances on the $319 of restricted cash held in restricted term deposits as well as the $447 collateralized accounts receivable at March 31, 2021, respectively, that are also subject to holdback performance obligations and escrow arrangements. In addition, this outcome may also prompt the derecognition of contingent consideration liabilities at March 31, 2021 related to performance obligations.

Acquisition of Fraser Valley Biogas Ltd.

Effective April 16, 2021, EverGen acquired all of the issued and outstanding shares of Fraser Valley Biogas Ltd. (“FVB”), pursuant to a share purchase agreement dated April 16, 2021 among EverGen and Heppells Potato Corporation and Pela Holdings Ltd. The Company paid an aggregate amount of $11,500 comprised of $10,500 cash consideration and issued 125,000 common shares valued at $8.00 per share. FVB owns and operates a biogas facility in Abbotsford, British Columbia which is under a long-term contract with Fortis BC. EverGen used a portion of the net proceeds from the March 18, 2021 Special Warrant Financing and funds from the March 17, 2021 credit facility to fund the acquisition of FVB.

Non-brokered private placement

On April 27, 2021, EverGen completed a non-brokered private placement of 111,111 common shares at $9.00 per common share for gross proceeds of $1,000.

F-140

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

Initial public offering

On April 28, 2021, the Company filed a preliminary prospectus with the intention of completing an initial public offering.

FortisBC 20 year offtake agreement

Organic Infrastructure Program grant receipt

Share rights holders entitled to common shares

Restricted share unit grant

On June 29, 2021, the Company granted 100,000 restricted share units to an officer of the Company.

ADDITIONAL INFORMATION

Additional information related to EverGen is available on SEDAR at www.sedar.com.

NON-GAAP MEASUREMENTS

EverGen uses certain financial measures referred to in this MD&A to quantify its results that are not prescribed by International Financial Report Standards (“IFRS”). The following terms: “EBITDA”, “adjusted EBITDA”, “operating profit” and “working capital” are not recognized measures under IFRS and may not be comparable to that reported by other companies. EverGen believes that, in addition to measures prepared in accordance with IFRS, the non-GAAP measurements provide useful information to evaluate the Company’s performance and ability to generate cash, profitability and meet financial commitments.

These non-GAAP measures ae intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

F-141

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

EBITDA and Adjusted EBITDA

Management considers EBITDA and adjusted EBITDA key metrics in analyzing operational performance and the Company’s ability to generate cash flow. EBITDA is measured as net income (loss) before interest, tax, depreciation and amortization. Adjusted EBITDA is measured as EBITDA adjusted for share-based payment expense and unusual or non-recurring items.

The following table provides a reconciliation of the non-GAAP measures, EBITDA and adjusted EBITDA, to the applicable IFRS measure for EverGen:

Three months ended March 31, 2021	Three months ended March 31, 2021
Net loss Tax recovery Depreciation and amortization Finance costs(income),net	(1,158) (501) 592 107
EBITDA Share-based payment expense Transaction costs Non-recurring general and administrative expenses	(960) 413 67 683
Adjusted EBITDA	203

In the first quarter of 2021, EverGen’s EBITDA adjustments for unusual or non-recurring items consist of $67 transaction costs and $683 of one-time professional, legal and consulting fees included in general and administrative expenses related to the integration of acquisitions, implementation of processes and in preparation of readying EverGen as a potential reporting issuer and public filer.

Operating profit

Management considers operating profit a key metric in analyzing operational efficiency and performance and the Company’s ability to generate cash flow. Operating profit is measured as gross profit, an additional subtotal found in the statements of net income, less operating costs and general and administrative expenses.

The following table provides a reconciliation of operating profit, a non-GAAP measure to the applicable IFRS measurement for the Company:

Three months ended March 31, 2021	Three months ended March 31, 2021
Gross profit Operating costs General and administrative expenses	988 (222) (1,246)
Operating profit(loss)	(480)

Working capital

Working capital for EverGen is calculated as current assets less current liabilities. The following table provides a reconciliation of working capital, a non-GAAP measure to the applicable IFRS measurements for the Company:

As at	March 31,	December 31,
(thousands)	2021	2020
Current assets	18,827	6,979
Current liabilities	(7,248)	(9,821)
Working capital surplus(deficit)	11,579	(2,842)

F-142

EverGen Infrastructure Corp. Management’s Discussion and Analysis All amounts in Canadian $000s, unless otherwise indicated

FORWARD LOOKING STATEMENTS

EverGen’s plans to develop and construct a platform of sustainable infrastructure, produce RNG and reduce carbon emissions;
Optimization and expansion of organic waste processing facilities and RNG feedstock;
Cost savings through synergies and efficiencies expected to be realized from the acquisitions of NZWA and SSS;
The sufficiency of EverGen’s liquidity to fund operations and to comply with covenants under its credit facility;
Continued growth through strategic acquisitions and consolidation opportunities;
Management’s expectations of replacing the Metro Vancouver material contract that was awarded to another bidder subsequent to March 31, 2021;
The establishment and realization of a circular economy through the Company’s organic waste management facilities and the expansion and development of renewable energy;
Continued growth of the feedstock opportunity from municipal and commercial sources;
Incurring prospective transaction costs;
The utilization of non-capital losses against future taxable income;
The conversion of Special Warrant Unit Shares to common shares of the Company upon the exercise or deemed exercise on the Automatic Exercise Date;
Negotiating increased prices for RNG offtake contracts;
Planned construction on the anaerobic digester at its Net Zero Waste Abbotsford facility; and
Expectations to start supplying FortisBC with RNG by the end of 2022.

Although management believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be accurate, as results and future events could differ materially from those expected or estimated in such statements. As such, readers are cautioned not to place undue reliance on these forward-looking statements. The forwardlooking statements contained in this MD&A are made as of the date hereof for the purposes of providing the readers with EverGen’s expectations for the coming year. The forward-looking statements and information may not be appropriate for other purposes. Furthermore, the Company undertakes no obligation to update or revise these forward-looking statements or information as a result of new information or future events, other than as required by applicable securities laws. However, in the event that subsequent events are reasonably likely to cause actual results to differ materially from forward-looking statements previously disclosed by the Company for a period that is not yet complete, EverGen will provide disclosure on such events and the anticipated impact of such events.

F-143

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July 5, 2021

To the Board of Directors of EverGen Infrastructure Corp.

In accordance with our engagement letter dated February 19, 2021, we have performed interim reviews of the consolidated financial statements (interim financial statements) of EverGen Infrastructure Corp. and its subsidiaries (together, the Company) consisting of:

the consolidated statement of financial position as at March 31, 2021;
the consolidated statement of net loss and comprehensive loss for the three-month period ended March 31, 2021;
the consolidated statement of changes in shareholders’ equity and cash flows for the three-month period ended March 31, 2021; and
the related notes.

These interim financial statements are the responsibility of the Company’s management.

We performed our interim reviews in accordance with Canadian generally accepted standards for a review of interim financial statements by an entity’s auditor.

An interim review is substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements. Accordingly, we do not express such an opinion. An interim review does not provide assurance that we would become aware of any or all significant matters that might be identified in an audit.

Based on our interim reviews, we are not aware of any material modification that needs to be made for these interim financial statements to be in accordance with International Financial Reporting Standards applicable to the preparation of interim financial statements, including International Accounting Standard 34, Interim Financial Reporting.

We have previously audited, in accordance with Canadian generally accepted auditing standards, the consolidated statement of financial position of the Company as at December 31, 2020 and the related consolidated statements of net income (loss) and comprehensive income (loss), shareholders’ equity and cash flows for the year then ended and related notes (not presented herein). In our report dated July 5, 2021, we expressed an unmodified audit opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated statement of financial position as at December 31, 2020 is fairly stated, in all material respects, in relation to the consolidated financial statements from which it has been derived.

This report is solely for the use of the Audit Committee of the Company to assist it in discharging its regulatory obligation to review these interim financial statements and should not be used for any other purpose.

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Chartered Professional Accountants

Calgary, Alberta

PricewaterhouseCoopers LLP 111-5th Avenue SW, Suite 3100, Calgary, Alberta, Canada T2P 5L3 T: +1 403 509 7500, F: +1 403 781 1825

“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership. F-144

EverGen Infrastructure Corp. Interim Consolidated Financial Statements

INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(Unaudited)

As at

(Canadian $000’s)

Notes	March 31, 2021 December 31, 2020
Current assets Cash and cash equivalents Restricted cash 3 & 10 Accounts receivable 4 Prepaid expenses and other assets Inventories Carbon emission credits	14,095 4,684 2,819 319 1,483 1,515 70 112 138 127 222 222
Property and equipment 5 Intangible assets 6 Goodwill	18,827 6,979 11,540 11,597 20,571 20,960 10,974 10,974
Total assets	61,912 50,510
Current liabilities Accounts payable and accrued liabilities 7 Loans payable 8 Lease liabilities 9 Contingent consideration 10	4,027 3,941 727 - 228 225 2,266 5,655
Loans payable 8 Lease liabilities 9 Deferred tax	7,248 9,821 6,283 - 3,171 3,229 4,893 5,551
Total liabilities	21,595 18,601
Shareholders’ equity Share capital 11 Share warrants 11 Share rights 11 Contributed surplus 11 Accumulated deficit	40,846 32,790 2,415 1,068 32 32 415 252 (3,391) (2,233)
Total shareholders’ equity	40,317 31,909
Total liabilities and shareholders’ equity	61,912 50,510
The notes are an integral part of these interim consolidated financial statements. Commitments and contingencies 20 Subsequent events 21

On behalf of the board of directors:

Signed “Chase Edgelow” Signed “Mary Hemmingsen”

Chase Edgelow, Director Mary Hemmingsen, Director

INTERIM CONSOLIDATED STATEMENT OF NET LOSS AND COMPREHENSIVE LOSS

(Unaudited)

F-145

EverGen Infrastructure Corp. Interim Consolidated Financial Statements

For the three month period ended, (Canadian $000s, except per share amounts)

Notes	March 31, 2021
Revenue 12 Cost of goods sold	1,585 597
Gross profit Operating costs General and administrative expenses 13 Depreciation and amortization 5,6 Share-based payment expenses 11 Finance costs (income), net 14 Transaction costs	988 222 1,246 592 413 107 67
Net loss before taxes Tax recovery 15	(1,659) (501)
Net loss and comprehensive loss	(1,158)
Lossper share – basic and diluted 16	($0.13)

The notes are an integral part of these interim consolidated financial statements.

F-146

EverGen Infrastructure Corp. Interim Consolidated Financial Statements

INTERIM CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited) (Canadian $000’s)

Notes
Share capital Balance, December 31, 2020 Common shares issued on private placements Common shares issued in exchange for consulting services in connection with acquisitions 11 Special Warrant Unit Shares issued in connection with the Special Warrant Financing 2 & 11 Common shares issued in exchange for advisor services in connection with Special Warrant Financing 11 Shareissue costs,net oftax 11

	32,790 1,320 250 7,225 95 (834)
Balance, March 31, 2021	40,846
Share warrants Balance, December 31, 2020 Share Warrant Unit Warrants issued in connection with Special Warrant Financing 11 Broker Options issued as consideration for broker services in connection with Special Warrant Financing brokered private placement 11 Broker Unit Warrants issued as consideration for broker services in connection with Special Warrant Financing brokered private placement 11 Finder Warrants issued as consideration for services in connection with Special Warrant Financing non- brokered private placement 11

	1,068 1,250 41 44 12
Balance, March 31, 2021	2,415
Share rights

Balance, December 31, 2020 and March 31, 2021 11	32
Contributed surplus Balance, December 31, 2020 Share-based payments 11 Common shares issued exchange for consulting services inconnection withacquisitions 11

	252
	413 (250)
Balance, March 31, 2021	415
Accumulated deficit Balance, December 31, 2020 Net comprehensiveloss

	(2,233) (1,158)
Balance, March 31, 2021	(3,391)
Total Shareholders’ Equity	40,317

The notes are an integral part of these interim consolidated financial statements.

F-147

EverGen Infrastructure Corp. Interim Consolidated Financial Statements

INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

For the three month period ended,

(Canadian $000’s)

Notes	March 31, 2021
Operating activities Net loss Items not affecting cash: Depreciation and amortization 5,6 Share-based payment expenses 11 Loan payable interest expense accrued Deferred income tax recovery 15 Changes in non-cash working capital 19	(1,158) 592 413 10 (420) (232)
Net cash flow used inoperating activities	(795)
Investing activities Expenditures on property and equipment 5 Contingent consideration payments 10 Changes in non-cash working capital 19	(146) (3,389) 117
Net cash flow used in investing activities	(3,418)
Financing activities Advance of loans payable 8 Repayment of principal portion of lease liabilities 9 Proceeds from Special Warrant Financing 11 Proceeds from private placements 11 Share issue costs 11 Changes in non-cash working capital 19	7,000 (55) 8,475 1,320 (880) 264
Net cash flow from financing activities	16,124
Net change in cash Cash, cash equivalents and restricted cash at beginning of period	11,911 5,003
Cash, cash equivalents and restricted cash at end ofperiod 3	16,914

The notes are an integral part of these interim consolidated financial statements.

F-148

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited) March 31, 2021

1. REPORTING ENTITY

EverGen was incorporated under the British Columbia Business Corporations Act on May 13, 2020.

The Company’s principal place of business is located at 390 – 1050 Homer Street, Vancouver, British Columbia and its registered office is located at 1200 Waterfront Centre, 200 Burrard Street Vancouver, British Columbia.

The Company’s revenue, cost of goods sold and certain operating costs are impacted by seasonal weather variation and the related fluctuations in volumes processed.

2. BASIS OF PREPARATION

a) Statement of compliance and basis of measurement

These interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting , using accounting policies consistent with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board ("IASB"). These financial statements are condensed as they do not include all of the information required by IFRS for annual financial statements and therefore should be read in conjunction with the Company’s audited consolidated financial statements for the period from incorporation on May 13, 2020 to December 31, 2020.

The interim consolidated financial statements have been prepared on a historical cost basis, except as detailed in the accounting policies disclosed in note 3 "Significant of Accounting Policies" of the Company’s audited consolidated financial statements for the period ended December 31, 2020. All accounting policies and methods of computation followed in the preparation of these financial statements are consistent with those of the previous period, except for income taxes. Income taxes on net income (loss) in the interim periods are accrued using the income tax rate that would be applicable to the expected total annual net income (loss).

The policies applied in these interim consolidated financial statements are based on IFRS issued and outstanding as at July 5, 2021, the date the board of directors approved these financial statements.

b) Functional and presentation currency

These interim consolidated financial statements are presented in Canadian dollars, EverGen’s functional currency, unless otherwise indicated.

c) Use of estimates, judgements and assumptions

F-149

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

estimates and judgments. Estimates and their underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which estimates are revised and for any future years affected.

There have been no significant changes to the use of estimates, judgements or assumptions since December 31, 2020, except as outlined below.

Special Warrant Financing

Management determined that the Special Warrants issued as part of the Special Warrant Financing completed on or about March 18, 2021, as disclosed in note 11, are equity instruments because they are in substance issued shares and warrants rather than a contract to issue shares and warrants in the future. Management considers that the decision to exercise the special warrant is not driven by the share price because the exercise price is nil and therefore the holder in substance is in the same economic position as holding the underlying shares and warrants. If we did not consider that the shares and warrants were in substance issued at the balance sheet date, the special warrant would meet the definition of a derivative financial liability because it contains an obligation to deliver a contract for the future delivery of the entity's own equity instruments.

3. RESTRICTED CASH

	March 31,	December
	2021	31, 2020
Organic Infrastructure Program – restricted term deposits	319	319
Acquisition holdbacks held in trust by escrow agent	2,500	-
	2,819	319

The Company’s restricted cash of $2,819 at March 31, 2021 (December 31, 2020 - $319) is held in restricted term deposits or held in trust. The grant awarded to the Company’s wholly-owned subsidiary SSS, for the expansion of the Company’s organic waste facility is held in restricted term deposits as required by the Organic Infrastructure Program. Pursuant to the NZWA and SSS share purchase agreements, acquisition holdbacks are held in trust by an escrow agent (note 10).

Holdback provisions and escrow arrangements

In accordance with the holdback provisions and escrow arrangements as attached to the NZWA and SSS share purchase agreements, EverGen paid $5,889 to the escrow agent in trust during the three month period ended March 31, 2021: (i) 50% of the holdback on February 24, 2021; and (ii) the remaining 50% of the holdback on March 18, 2021. The holdback provisions include $3,389 related to standard indemnity provisions and $2,500 related to performance driven holdbacks. The $3,389 indemnity holdbacks are expected to be released from escrow pursuant to customary closing adjustments and the Company recognized theses indemnity holdbacks paid as contingent consideration payments as disclosed in note 10. The $2,500 performance driven holdbacks are expected to be released from escrow subject to performance obligations and remain as restricted cash at March 31, 2021.

In addition, the Company’s $319 restricted cash held in restricted term deposits, as required by the Organic Infrastructure Program, as well as $447 collateralized accounts receivable at March 31, 2021, see note 4, are also restricted subject to these holdback performance obligations and escrow arrangements.

4. ACCOUNTS RECEIVABLE

	March 31,	December
	2021	31, 2020
Trade receivables	998	1,056
Organic Infrastructure Program receivable	447	447

F-150

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

Other	38	12
	1,483	1,515

The Company, through its wholly-owned subsidiary, SSS, was awarded a federal grant of $765 under the Organic Infrastructure Program for the expansion of its organic waste facility. A portion of the grant, $447 is recorded in accounts receivable at March 31, 2021 (December 31, 2020 - $447) and is collateralized, of which $375 was received on May 7, 2021 and held as restricted cash.

5. PROPERTY AND EQUIPMENT

Cost	Buildings and leasehold improvements	Equipment, vehicles and other	Right-of-use assets	Total
May 13, 2020	-	-	-	-
Acquisition of NZWA	2,385	1,847	2,001	6,233
Acquisition of SSS	2,174	1,737	1,453	5,364
At December 31, 2020	4,559	3,584	3,454	11,597
Additions	56	90	-	146
At March 31, 2021	4,615	3,674	3,454	11,743
Accumulated depreciation
At December 31, 2020 Depreciation	- 62	- 71	- 70	- 203
At March 31, 2021	62	71	70	203
Carrying value
At December 31, 2020	4,559	3,584	3,454	11,597
At March 31, 2021	4,553	3,603	3,384	11,540

EverGen’s property and equipment consists of buildings and leasehold improvements, equipment, vehicles and other assets and ROU assets. The Company’s ROU assets include lease contracts for land and equipment. EverGen leases, under long term leases, the land on which it operates and equipment which is used in operations, under various lease terms. Depreciation on the acquired assets commenced on January 1, 2021.

As at March 31, 2021, there were no indicators of impairment related to the Company’s property and equipment.

F-151

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

6. INTANGIBLE ASSETS

Cost	Brands	Customer contracts and stakeholder relationships	Total
May 13, 2020	-	-	-
Acquisition of NZWA	110	11,480	11,590
Acquisition of SSS	1,070	8,300	9,370
At December 31, 2020 and March 31, 2021	1,180	19,780	20,960
Accumulated amortization
At December 31, 2020	- 15	- 374	- 389
Amortization
At March 31, 2021	15	374	389
Carrying value
At December 31, 2020	1,180	19,780	20,960
At March 31, 2021	1,165	19,406	20,571

Amortization on the acquired assets commenced on January 1, 2021.

As at March 31, 2021, there were no indicators of impairment related to the Company’s intangible assets.

7. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

	March 31,	December
	2021	31, 2020
Trade payables and accrued liabilities	3,357	3,043
Taxes payable	504	516
Other liabilities	166	382
	4,027	3,941

8. LOANS PAYABLE

	Total
At December 31, 2020	-
Advances	7,000
Interest expense (note 14)	10
Principal payments	-
At March 31, 2021	7,010
Less current portion	727
Long-termportion	6,283

As at March 31, 2021, $7,000 was drawn against the credit facility.

F-152

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

The credit facility agreement is subject to the following covenants:

Maintain a consolidated working capital ratio equal to or greater than 1.20:1 at all times;
Maintain a consolidated “fixed charge coverage ratio” as defined in the agreement equal to or greater than 1.20:1 at all times, tested quarterly on a rolling four quarters basis;
Maintain a consolidated “total funded debt to EBITDA ratio” as defined in the agreement equal to or less 3.00 at all times, tested quarterly on a rolling four quarters basis; and
Other operational and financial covenants including but not limited to the Company’s ability to pay dividends, incur additional debt, directly or indirectly grant loans or make investments and other such matters.

As at March 31, 2021, the Company is in compliance with all covenants.

9. LEASE LIABILITIES

	Total
As at December 31, 2020	3,454
Additions	-
Interest expense (note 11)	49
Lease payments	(104)
As at March 31, 2021	3,399
Less current portion	(228)
Long-termportion	3,171

The Company has lease liabilities for land and equipment. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. Certain of the Company’s leases include purchase options, when a purchase option is expected to be exercised, it is included in the determination of the lease liability. The lease terms of the land leases include all available renewal options to the Company, as lessee, based on the reasonable expectation that these renewal terms will be exercised. EverGen does not have any significant termination options and the residual amounts are not material.

10. CONTINGENT CONSIDERATION

	Total
As at December 31, 2020	5,655
Contingent consideration payments	(3,389)
As at March 31,2021	2,266

At December 31, 2020, the Company recognized $5,655 of contingent consideration related to the acquisitions of NZWA and SSS. The contingent consideration included holdback amounts and working capital adjustments.

During the three month period ended March 31, 2021, pursuant to the NZWA and SSS share purchase agreements, EverGen transferred $5,889 holdback to the escrow agent in trust and recognized $3,389 of standard indemnity holdback as contingent consideration payments and the $2,500 balance is held in trust and included in restricted cash at March 31, 2021, as disclosed in note 3.

F-153

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

11. SHAREHOLDERS’ EQUITY

a) Authorized

The Company has authorized an unlimited number of common shares without par value and an unlimited number of preferred shares.

b) Issued share capital

b) Issued share capital
	Number of
	common
	shares
	(thousands)	Amount
At May 13, 2020	-	-
Issuance to the Founders at incorporation	-	-
Issuance to the Founders on conversion of convertible notes	1,260	600
Issuance to Additional Founders	140	700
Issuance on non-brokered private placement	1,366	6,830
Issuance in exchange for advisor services in connection with non-brokered
private placement	42	210
Issuance on brokered private placement	4,617	23,053
Issuance as consideration for acquisitions of NZWA and SSS	778	3,889
Share issue costs, net of tax effect	-	(2,492)
At December 31, 2020	8,203	32,790
Issuance on non-brokered private placements	264	1,320
Issuance in exchange for consulting services in connection with
acquisitions	50	250
Issuance of Special Warrant Unit Shares in connection with the Special
Warrant Financing(1)	1,059	7,225
Issuance in exchange for advisor services in connection with the Special
Warrant Financing	13	95
Share issue costs, net of tax effect		(834)
At March 31, 2021(1)	9,589	40,846

(3) Includes the 1,059,325 Special Warrant Unit Shares classified as equity that will convert to common shares of the Company upon the exercise or deemed exercise on the Automatic Exercise Date.

The following common shares were issued during the three month period ended March 31, 2021:

Private placements of common shares

On January 12, 2021, EverGen completed a non-brokered private placement of 254,000 common shares at $5.00 per common share for gross proceeds of $1,270.

In addition, during the three month period ended March 31, 2021, EverGen completed other private placements of 10,000 common shares at $5.00 per common share for gross proceeds of $50.

Common shares issued to consultants and advisors

On January 26, 2021, the Company issued 50,000 common shares with a fair value of $5.00 per common share to an advisor and former shareholder of NZWA as consideration for services rendered in connection with the acquisition of NZWA by EverGen at December 31, 2020. The Company previously recognized $250 of share-based payment expense in connection with the fair value of these services rendered for the period ended December 31, 2020.

Special Warrant Financing

On March 18, 2021, EverGen completed a private placement of 1,059,325 Special Warrants at $8.00 per unit for aggregate gross proceeds of $8,475 (the “Special Warrant Financing”), see share warrants section.

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

Each Special Warrant Unit is comprised of:

One Common Share (a “Special Warrant Unit Share”) and
One-half of one Common Share purchase warrant (each whole Common Share purchase warrant, a “Special Warrant Unit Warrant”).

Management determined that the Special Warrants are equity instruments, see note 2, and EverGen has included the 1,059,325 Special Warrant Unit Shares as part of share capital and included the 529,662 Special Warrant Unit Warrants as part of share warrants, see share warrants below.

EverGen determined a fair value of $2.36 per Special Warrant Unit Warrant, see share warrants below and recognized $1,250 of gross proceeds in share warrants and the balance of $7,225 in share capital.

Subsequent event

On April 27, 2021, EverGen completed a non-brokered private placement of 111,111 common shares at $9.00 per common share for gross proceeds of $1,000.

c) Share issue costs

The Company recorded the following share issue costs as a reduction of equity:

For the three month period ended March 31, 2021

For the three month period ended March 31, 2021
Advisor services settled by common share issuance	95
Advisor services settled by share warrant issuances	97
Share issue costs paid in cash or accrued	880
Tax effect of share issue costs	(238)
Total	834

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

d) Share warrants

d) Share warrants
	Number of
	share
	warrants
	(thousands)	Amount
At May 13, 2020	-	-
Issuance of share warrants as consideration for advisor services in
connection with non-brokered private placement	63	198
Issuance of share warrants as consideration for broker services in
connection with brokered private placement	277	870
At December 31, 2020	340	1,068
Issuance of Special Warrant Unit Warrants in connection with Special
Warrant Financing	530	1,250
Issuance of Broker Options as consideration for broker services in
connection with Special Warrant Financing brokered private
placement	23	41
Issuance of Broker Unit Warrants as consideration for broker services in
connection with Special Warrant Financing brokered private
placement	11	44
Issuance of Finder Warrants as consideration for services in connection
with Special Warrant Financing non-brokered private placement	7	12
At March 31, 2021	911	2,415

The following share warrants were issued during the three month period ended March 31, 2021:

Special Warrant Financing

On March 18, 2021, EverGen completed a private placement of 1,059,325 Special Warrants at $8.00 per unit for aggregate gross proceeds of $8,475 as part of the Special Warrant Financing and completed:

A brokered private placement of 756,200 Special Warrants for gross proceeds of $6,050; and
A non-brokered private placement of 303,125 Special Warrants for gross proceeds of $2,425

One Common Share (a “Special Warrant Unit Share”) and
One-half of one Common Share purchase warrant (each whole Common Share purchase warrant, a “Special Warrant Unit Warrant”).

Each of the 529,662 Special Warrant Unit Warrants entitles the holder thereof to acquire one Common Share (a “Warrant Share”) at a price of $10.50 for a period of 24 months from the Automatic Exercise Date.

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

The estimated fair value of the Special Warrant Unit Warrants was calculated at the date of grant using the Black-Scholes model and the following weighted-average assumptions:

	Special Warrant
For the three month period ended March 31, 2021	Unit Warrants
Share price on grant date	7.00
Exercise price	10.50
Fair value per warrant	2.36
Expected volatility (percent)	80
Risk-free interest rate (percent)	0.27
Expected forfeiture rate (percent)	-
Expected life (years)	2.18
Expected dividend yield	-

Estimated forfeiture rates are adjusted to the actual forfeiture rate at time of forfeiture. Expected volatility is based on the historical volatility of publicly-traded peer companies. Expected life is based on general holder behavior and the contractual maturity of the instrument and the risk-free interest rate is based on Government of Canada bonds of a similar duration.

In connection with the brokered private placement, the Company:

Paid to the agents a cash fee equal to 6 percent of the gross proceed; and
Issued to the Special Warrant Agents 22,686 Broker Options.

Each Broker Option will automatically be exchanged for one Broker Warrant on the Automatic Exercise Date, with each Broker Warrant being exercisable for one unit of the Company (a “Broker Unit”) at a price of $8.00 for a period of 12 months following the Automatic Exercise Date. Each Broker Unit is comprised of:

One Common Share (a “Broker Unit Share”); and
One-half of one Common Share purchase warrant (each whole Common Share purchase warrant, “Broker Unit Warrant”).

Each Broker Unit Warrant entitles the holder thereof to acquire one Common Share (a “Broker Warrant Share”) at a price of $10.50 for a period of 24 months from the Automatic Exercise Date.

Additionally, in connection with the non-brokered private placement, the Company:

Paid the finder a fee equal to 6 percent of the gross proceeds from 225,000 Special Warrants sold to subscribers introduced by the finder, which was settled by:
Issuing 13,500 Common Shares at a price of $8.00 per Common Share to the finder; and
Issued 6,750 Finder Warrants.

Each Finder Warrant is exercisable for one Common Share (a “Finder Warrant Share”) at a price of $8.00 for a period of 12 months following the Automatic Exercise Date.

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

The estimated fair values of the Broker Options, the Broker Unit Warrants and the Finder Warrants were calculated at the date of grant using the Black-Scholes model and the following weighted-average assumptions:

assumptions:
		Broker Unit
For the three month period ended March 31, 2021 Broker Options		WarrantsFinder	Warrants
Share price on grant date	7.00	n/a	7.00
Expected share price on the Automatic Exercise Date	n/a	9.40	n/a
Exercise price	9.40	10.50	9.40
Fair value per warrant	1.80	3.92	1.80
Expected volatility (percent)	83	80	83
Risk-free interest rate (percent)	0.16	0.27	0.16
Expected forfeiture rate (percent)	-	-	-
Expected life (years)	1.18	2.18	1.18
Expected dividend yield	-	-	-

Estimated share price on the Automatic Exercise Date is based on a probability-weighted offering price estimate of the anticipated initial public offering. Estimated forfeiture rates are adjusted to the actual forfeiture rate at time of forfeiture. Expected volatility is based on the historical volatility of publicly-traded peer companies. Expected life is based on general holder behavior, the contractual maturity of the instrument and a probability-weighted estimate of the Automatic Exercise Date, and the risk-free interest rate is based on Government of Canada bonds of a similar duration.

For the period ended March 31, 2021, issue costs related to the Share Warrant Financing was recognized as share issue costs and a reduction of share capital.

e) Share rights

e) Share rights
	Number of
	share rights
	(thousands)	Amount
At May 13, 2020	-	-
Issuance of share rights at brokered private placement	462	32
At December 31, 2020 and March 31, 2021	462	32

The Company’s common shares being listed on a recognized Canadian stock exchange through:
A bona fide initial public offering; or
The consummation by the Company of any transaction including, without limitation, any consolidation, amalgamation, merger, plan of arrangement, reverse take-over, qualifying transaction, change of business or any other business combination or similar transaction; or
The entering into of a definitive agreement with a third party that would result in a “Change of Control”, which would be subject to shareholder approval; and
A concurrent financing to raise minimum gross proceeds of at least $10,000.

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

f) Share-based incentive programs and payment plans

Equity Incentive Plan

The purpose of the Equity Incentive Plan is to advance the interests of the Company by providing an incentive to the directors, officers, employees and consultants of the Company, and any of its subsidiaries (including any acquired businesses) and affiliates, if any, to align growth objectives of the Company and participants, to associate a portion of the participants’ compensation with the Company’s long term performance and to attract to and retain in the employment of the Company or any of its subsidiaries, persons of experience and ability, by providing them with the opportunity to acquire an increased proprietary interest in the Company through the acquisition of common shares.

EverGen classifies these share-based compensation instruments as equity-settled and follows the fair value method of valuing these instruments. Under this method, compensation cost is measured at the fair value of the date of grant and expensed over the vesting period with a corresponding increase to contributed surplus.

Options

Pursuant to the EverGen Equity Incentive Plan, the Company may grant Options from time to time to directors, officers, employees and consultants of the Company to acquire common shares in the capital stock of the Company at an exercise price as determined by the board of directors. The Options will vest evenly over a period of three years and are exercisable for a period of seven years from the grant date to purchase one common share for each Option held.

The Company has the following outstanding Options at March 31, 2021:

		Weighted
	Number of	average
	Options	exercise price
Outstanding at December 31, 2020	-	-
Granted	195	9.40
Outstanding at March 31, 2021	195	9.40
On March 18, 2021, the Company granted 195,000 Options to officers, an employee and		consultants of the
Company at an exercise price equal to the offering price in the anticipated initial public offering of the
Company.
The estimated fair value of the Options was calculated at the date of grant using the Black-Scholes model
and the following assumptions:
For the three month period ended March 31, 2021
Share price on grant date		7.00
Expected exercise price		9.40
Fair value per Option		4.45
Expected volatility (percent)		75
Risk-free interest rate (percent)		0.53
Expected forfeiture rate (percent)		10
Expected life (years)		7
Expected dividend yield		-

On March 18, 2021, the Company granted 195,000 Options to officers, an employee and consultants of the Company at an exercise price equal to the offering price in the anticipated initial public offering of the Company.

The estimated fair value of the Options was calculated at the date of grant using the Black-Scholes model and the following assumptions:

Estimated exercise price of the March 18, 2021 Option grant is based on a probability-weighted offering price estimate of the anticipated initial public offering. Estimated forfeiture rates are adjusted to the actual forfeiture rate at time of forfeiture. Expected volatility is based on the historical volatility of publicly-traded

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

peer companies. Expected life is based on general option-holder behavior and the risk-free interest rate is based on Government of Canada bonds of a similar duration.

For the period ended March 31, 2021, $17 of share-based payment expense related to Options was recognized in net income (loss).

PSUs, RSUs and DSUs

*PSUs, RSUs and DSUs*
The Company has the following outstanding PSUs,	RSUs and DSUs at	March 31, 2021:
	Number of	Number of	Number of
	PSUs	RSUs	DSUs
Beginning, May 13, 2020	-	-	-
Granted	600	-	-
Outstanding at December 31, 2020	600	-	-
Granted	-	18	28
Outstanding at December 31, 2020	600	18	28

Performance share units

EverGen has a Performance Share Unit Plan (“PSU Plan”) whereby PSUs may be granted from time to time to directors, officers, employees and contractors of the Company. The Company is entitled to issue up to 600,000 performance share units, pursuant to the PSU Plan, approved by the board of directors on December 30, 2020. While the number of PSUs outstanding will count towards the maximum number of common shares reserved under the Equity Incentive Plan, no additional PSUs can be granted under the Equity Incentive Plan or the PSU Plan.

The vesting period of PSUs granted is determined by the board of directors at the time of grant, and for each performance share unit exercised, the holder will receive one common share. Each PSU automatically terminates 10 years from the date of grant.

On December 31, 2020, the Company granted 600,000 PSUs to the officers and directors of EverGen. These PSUs were granted subject to the following performance conditions:

Achievement of consolidated earnings before interest, tax, depreciation and amortization of at least $4,500 in a 12-month consecutive period; and
Achievement of average renewable RNG production of at least 500 gigajoules/day over a 12-month consecutive period.

For the three month period ended March 31, 2021, $201 of share-based payment expense related to PSUs was recognized in net income (loss).

Restricted share units

Pursuant to the EverGen Equity Incentive Plan, the Company may grant RSUs from time to time to directors, officers, employees and consultants of the Company.

The RSUs will vest evenly over a period of three years. Upon vesting of the RSUs, the plan participant will receive, at the option of the Company, one common share for each vesting RSU or a cash payment based on the fair value of the vesting RSU. The Company has classified RSUs as equity-settled share-based compensation.

On March 18, 2021, the Company granted 17,500 RSUs to an officer and consultants of the Company.

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

The estimated fair value of the RSUs was calculated at the date of grant using the Black-Scholes model and the following assumptions:

For the three month period ended March 31, 2021

For the three month period ended March 31, 2021
Share price on grant date	7.00
Fair value per RSU	7.00
Expected volatility (percent)	75
Risk-free interest rate (percent)	0.53
Expected forfeiture rate (percent)	10
Expected life (years)	3.00
Expected dividend yield	0.00

Estimated forfeiture rates are adjusted to the actual forfeiture rate at time of forfeiture. Expected volatility is based on the historical volatility of publicly-traded peer companies. Expected life is based on general optionholder behavior and the risk-free interest rate is based on Government of Canada bonds of a similar duration.

For the period ended March 31, 2021, $2 of share-based payment expense related to RSUs was recognized in net income (loss).

On June 29, 2021, the Company granted 100,000 restricted share units to an officer of the Company.

Deferred share units

Pursuant to the EverGen Deferred Share Unit Plan (“DSU Plan”), the Company may grant DSUs from time to time to directors of the Company. DSUs will be fully vested upon being granted to directors. On March 18, 2021, the Company granted 27,500 DSUs to its directors.

	Number of
	DSUs
Beginning, December 31, 2020	-
Granted	28
Outstanding at March 31, 2021	28

The estimated fair value of the DSUs on the date of the grant was based on the prevailing $7.00 per common share fair value on the grant date. The Company classifies DSUs as equity-settled. As DSUs fully vest upon being granted, the share-based payment expense of these instruments was recognized in full on the grant date.

For the period ended March 31, 2021, $193 of share-based payment expense related to DSUs was recognized in net income (loss).

Share-based payments

EverGen recorded the following share-based payments directly in equity:

*Share-based payments* EverGen recorded the following share-based payments directly in equity:
For the three month period ended	March 31, 2021
Issuance of common shares in exchange for advisor services in
connection with Special Warrant Financing	95
Issuance of share warrants in exchange for advisor services in
connection with Special Warrant Financing	97
Total	192

F-161

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

EverGen recorded the following share-based payment expense in net income (loss):

For the three month period ended	March 31, 2021
Options	17
PSUs	201
RSUs	2
DSUs	193
Total	413

12. REVENUE

For the three month period ended	March 31, 2021
Tipping fees	1,255
Organic compost and soil sales	195
Trucking services	135
	1,585

Tipping fee income includes the disposal of biosolids and organic waste.

13. GENERAL AND ADMINISTRATIVE EXPENSES

13. GENERAL AND ADMINISTRATIVE EXPENSES
For the three month period ended	March 31, 2021
Salaries and wages	175
Professional and consulting fees	961
Other	110
	1,246

14. FINANCE COSTS (INCOME), NET

14. FINANCE COSTS (INCOME), NET
For the three month period ended	March 31, 2021
Interest expense on loans payable (note 8)	10
Interest expense on lease liabilities (note 9)	49
Other	50
Interest income	(2)
	107

15. INCOME TAXES

The Company recognized the following income taxes:

The Company recognized the following income taxes:
For the three month period ended	March 31, 2021
Current tax expense (recovery)	(82)
Deferred tax expense (recovery)	(419)
Tax expense(recovery)	(501)

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

16. PER SHARE AMOUNTS

Basic net loss and comprehensive net loss per share

The calculation of basic net loss and comprehensive net loss per share for the three month period ended March 31, 2021 was based on the net loss and comprehensive loss attributable to common shareholders of $1,158 and the weighted-average number of common shares outstanding during the period, calculated as follows:

For the three month period ended March 31, 2021

For the three month period ended March 31, 2021
Thousands of shares
Issued common shares at December 31, 2020	8,203
Effect of private placement issuances	229
Effect of Special Warrant Unit Shares issued in connection with
Special Warrant Financing(1)	153
Effect of shares issued to consultant on acquisitions	36
Effect of shares issued to finders or advisors	2
Basic weighted-average common shares outstanding	8,623

(1) Includes the effect of the 1,059,325 Special Warrant Unit Shares classified as equity that will convert to common shares of the Company upon the exercise or deemed exercise on the Automatic Exercise Date as they are considered outstanding, see notes 2 and 11.

Diluted net loss and comprehensive net loss per share

The calculation of diluted net loss and comprehensive net loss does not include warrants, shareholder rights, PSUs, DSUs, RSUs or stock options as the effect would be anti-dilutive.

The basic and diluted net loss and comprehensive net loss for the period ended March 31, 2021 was $1,158.

17. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

Financial instruments

The fair value of lease liabilities and loans is initially measured at fair value and carried at amortized cost. The fair value of the lease liabilities and loans payable approximates their carrying value due to the specific non-tradeable nature of these instruments.

The fair value of contingent consideration recognized in a business combination is initially measured at fair value on the date of acquisition using widely accepted valuation techniques (level 3). Changes in the fair value of contingent consideration are recognized in net income (loss).

Financial risk management

EverGen’s activities expose it to certain financial risks, including market risk, credit risk and liquidity risk.

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

Market risk

Market risk is the risk that changes in market conditions, such as interest rates and foreign exchange rates will affect EverGen’s net income (loss) or value of financial instruments.

Interest rate risk

EverGen may mange its interest expense using a mix of fixed and variable interest rates on its debt. Changes in interest rates could result in an increase or decrease in the amount the Company pays to service variable interest rate debt.

At March 31, 2021, the Company has fixed interest rates associated with its lease liabilities, thereby substantially reducing the cash flow risk of market fluctuations related to interest rates.

Foreign exchange risk

EverGen has very few transactions denominated in foreign currencies thereby minimizing risk associated with fluctuations in exchange rates.

Credit risk

Credit risk is the risk that the counterparty to a financial asset will default, resulting in EverGen incurring a financial loss. The Company’s credit risk is concentrated with a few customers, primarily municipal governments. At March 31, 2021, 8 customers represented 76 percent of accounts receivable and accounts receivable includes $447 of which is collateralized (December 31, 2020 – two customers represented 31 percent of accounts receivable).

The Company, through its wholly-owned subsidiary SSS, submitted a request for proposal for the City of Vancouver’s North Shore Transfer Station related to organics management. The request for proposal was for contracts expiring on June 30, 2021 and currently held by the Company for both tipping and trucking of organic waste. During the three month period ended March 31, 2021, these contracts accounted for 58 percent SSS’s revenue. On April 16, 2021, the Company was notified that this contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee.

EverGen held cash and cash equivalents of $14,095 and restricted cash of $2,819 at March 31, 2021 which represents its maximum credit exposure on these assets. The cash is held with major financial institution counterparties and management believes credit risk is minimal.

Liquidity risk

F-164

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

The expected timing of cash outflows relating to financial liabilities on balance sheet as at March 31, 2021 are:

re:
		1 to 2	2 to 3	3 to 4	4 to 5	Thereafte
<	1year	years	years	years	years	r	Total
Accounts payable
and accrued liabilities	4,027	-	-	-	-	-	4,027
Contingent
consideration	2,266	-	-	-	-	-	2,266
Loan payments(1)	979	936	5,792	-	-	-	7,707
Lease payments(1)	417	411	383	362	302	3,221	5,096
Total	7,689	1,347	6,175	362	302	3,221	19,096
(1) Includes principal and interest.

The Company anticipates that its existing capital resources will be adequate to satisfy its liquidity requirements over the next 12 months.

Capital management

The capital structure of EverGen consists of the following:

	March 31,	December 31,
	2021	2020
Working capital (surplus) deficit	(11,579)	2,842
Long-term loans payable	6,283	-
Long-term lease liabilities	3,171	3,229
Shareholders’equity	40,317	31,909
	38,192	37,980

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

18. RELATED PARTY BALANCES AND TRANSACTIONS

Key management compensation

The value of compensation and other fees paid to board of directors and members of executive management of EverGen is as follows:

management of EverGen is as follows:
For the three month period ended	March 31, 2021
Management salaries and other benefits	178
Share-based payment expense	411
	589

At March 31, 2021, $3 is payable to members of executive management as reimbursement of EverGen expenses incurred.

Other related party transactions

19. SUPPLEMENTARY CASH FLOW INFORMATION

For the three month period ended	March 31, 2021
Net changes in non-cash working capital:
Accounts receivable	32
Prepaid expenses and other assets	42
Inventories	(11)
Accounts payable and accrued liabilities	86
	149
Net changes in non-cash working capital related to:
Operating activities	(232)
Investing activities	117
Financing activities	264
	149
Interest paid	50
Taxespaid	-

F-166

EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

The following table reconciles the movement in cash flows arising from certain financing activities:

For the three month period ended	March 31, 2021
Lease liabilities
Balance, beginning of period	3,454
Principal repayments	(55)
Balance, end of period	3,399
Share capital
Balance, beginning of period	32,790
Proceeds from private placements	1,320
Proceeds from Special Warrant Financing	7,225
Issuance costs	(880)
Non-cash items
Common shares issued in exchange for consulting services in
connection with acquisitions	250
Common shares issued in exchange for advisor services in
connection with Special Warrant Financing	95
Non-cash issuance costs	(192)
Tax effect of issuance costs	238
Balance, end of period	40,846

20. COMMITMENTS AND CONTINGENCIES

Contractual obligations and commitments

At March 31, 2021, EverGen had the following additional contractual obligations and commitments as follows:

		1	to 2	2 to 3	3 to 4	4 to 5	Thereafte
	< 1year	years		years	years	years	r		Total
Service contracts(1)	12		12	5	5	4		-	38
Consulting services
agreements	200		50	-	-	-		-	250
Carbon emission
credits –
purchase agreement	141		81	58	-	-		-	280
Total	353		143	63	5	4		-	568
(1) Service contracts for	leased equipment.

In addition to the above amounts, the Company has annual commitments related to certain of its land leases for utilities and property taxes that fluctuate with usage and assessments, respectively.

Uncertainty over income tax treatments

EverGen believes that the accruals for tax liabilities are adequate for all open tax years based on the assessment of many factors, including interpretations of tax law and prior experience.

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

21. SUBSEQUENT EVENTS

SSS organics management contract

The Company, through its wholly-owned subsidiary SSS, submitted a request for proposal, specifically No. 20-016, for the City of Vancouver’s North Shore Transfer Station five-year contract related to organics management. The request for proposal was for contracts expiring June 30, 2021, currently held by SSS for both tipping and trucking of organic waste. During the three months ended March 31, 2021, these contracts accounted for 31 percent of EverGen’s revenue (year ended December 31, 2020, these contracts accounted for 70 percent of SSS’s revenue). On April 16, 2021, the Company was notified that this material contract was awarded to another bidder subject to final review and execution by the commissioner of the Metro Vancouver Regional District – Zero Waste Committee. Contractual provisions are in place to safeguard EverGen in the event that this contract was not renewed or otherwise offset by new contracts. Under compensation provisions in EverGen’s purchase agreement with the previous shareholders of SSS, this request for proposal outcome may prompt (i) the release to EverGen of $2,000 of performance driven holdbacks paid to the escrow agent in trust during the three month period ended March 31, 2021 and (ii) the release of encumbrances on the $319 of restricted cash held in restricted term deposits as well as the $447 collateralized accounts receivable at March 31, 2021, respectively, that are also subject to holdback performance obligations and escrow arrangements. In addition, this outcome may also prompt the derecognition of contingent consideration liabilities at March 31, 2021 related to performance obligations.

Acquisition of Fraser Valley Biogas Ltd.

Non-brokered private placement

On April 27, 2021, EverGen completed a non-brokered private placement of 111,111 common shares at $9.00 per common share for gross proceeds of $1,000.

Initial public offering

On April 28, 2021, the Company filed a preliminary prospectus with the intention of completing an initial public offering.

FortisBC 20 year offtake agreement

Organic Infrastructure Program grant receipt

Share right holders entitled to common shares

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EverGen Infrastructure Corp. Consolidated financial statements All amounts in Canadian $000s, unless otherwise indicated

common shares of EverGen in the aggregate for no additional consideration. As at July 5, 2021, these common shares have not been issued.

Restricted share unit grant

On June 29, 2021, the Company granted 100,000 restricted share units to an officer of the Company.

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UNAUDITED PRO FORMA FINANCIAL STATEMENTS

BASIS OF PRESENTATION

The unaudited Pro Forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss) has been prepared for inclusion in the Prospectus of EverGen dated April 28, 2021. The pro forma statement has been prepared from:

a. Audited consolidated financial statements of the Company as at December 31, 2020, for the period of incorporation on May 13, 2020 to December 31, 2020;
b. Audited financial statements of NZWA as at December 31, 2020, for the year ended December 31, 2020; and
c. Audited financial statements of SSS as at December 31, 2020, for the year ended December 31, 2020.

In the opinion of EverGen’s management, the unaudited Pro Forma Consolidated Financial Statements include all adjustments necessary for fair and material presentation in accordance with IFRS as issued by the IASB. The Audited Consolidated Statement of Financial Position of EverGen as at December 31, 2020 gives effect to the transaction described above as if it had occurred on January 1, 2020. The unaudited Pro Forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss) give effect to the transaction as if it occurred on January 1, 2020.

The unaudited Pro Forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss) may not be indicative of the results that actually would have occurred if the events reflected therein had been in effect on the dates indicated or of the results that may be obtained in the future. The unaudited Pro Forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss) should be read in conjunction with the audited consolidated financial statements of EverGen and related notes as at and for the period ended December 31, 2020, and the standalone unaudited financial statements of NZWA and SSS, and related notes as at and for the year ended December 31, 2020.

PRINCIPLES OF CONSOLIDATION

The adjustments to the unaudited Pro Forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss) are preliminary and have been made solely for the purpose of presenting the unaudited Pro Forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss), which is necessary to comply with applicable disclosure and reporting requirements. The unaudited Pro Forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss) are prepared in accordance with EverGen’s accounting policies where applicable and Canadian securities laws as applicable. The accounting policies of EverGen are detailed in note 3 and the significant estimates, judgements and assumptions used in preparing EverGen’s financial statements are detailed in note 2 to the Audited Consolidated Financial Statements of EverGen, which is incorporated by reference in this Prospectus.

PRO FORMA ACCOUNTING AND PRESENTATION ADJUSTMENT

Accounting Adjustment

EverGen, NZWA and SSS prepare their financial statements using similar accounting policies in accordance with IFRS. NZWA and SSS; however, have not chosen to recognize self-generated carbon tax credits, whereas EverGen has recognized such carbon tax credits at fair value on acquisition.

Pro forma Financial Statements

The pro forma financial information may not reflect the financial condition or operating results of the combined or reorganized entity or may not be useful in predicting its future condition and operating results. The pro forma combined financial statements do not necessarily reflect what the combined company’s financial condition or results of operations would have been had the acquisition occurred on the dates indicated. The pro forma financial statements

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may not be useful in predicting the future financial condition and results of operations of the combined company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors.

Management believes that the synergies of consolidating NZWA and SSS are most accretive on a combined basis and the acquisitions were not contemplated individually.

Pro forma Consolidated Statement of Net Income (Loss) and Comprehensive Income (Loss)

The following pro forma consolidated statement of net income (loss) and comprehensive income (loss) are based on the pro forma results as if the closing of the acquisitions of NZWA and SSS had occurred on January 1, 2020.

					Pro forma
($000s, except	per				adjustments and
share)		NZWA	SSS	EverGen	eliminations	Total
Revenue		3,919	4,953	-	(4)	8,868
Cost ofgoods sold		933	1,924	-	-	2,857
Gross profit		2,986	3,029	-	(4)	6,011
Operating costs		737	1,100	-	(4)	1,833
General and
administrative
expenses		315	510	328	-	1,153
Share-based
payment expense		-	-	1,452	-	1,452
Transaction costs		-	-	741	-	741
Depreciation	and
amortization		408	319	-	1,570	2,297
Finance costs
(income), net		195	113	-	-	308
Other (income)
expense,net		(129)	(58)	-	70	(117)
Net income (loss)
before taxes		1,460	1,045	(2,521)	(1,640)	(1,656)
Tax expense
(recovery)		366	249	(288)	(443)	(116)
Net income (loss)
and
comprehensive
income (loss)		1,094	796	(2,233)	(1,197)	(1,540)

Net loss per share Basic and diluted ($0.19)

The above pro forma consolidated statement of net income (loss) and comprehensive income (loss) is the sum of the statement of net income (loss) and comprehensive income (loss) for NZWA and SSS for the year ended December 31, 2020 and EverGen’s consolidated statement of net income (loss) and comprehensive net income (loss) for the period ended December 31, 2020 adjusting for intercompany revenues and expenses as appropriate.

Revenue includes revenue generated from a material contract that has not been renewed effective July 1, 2021. See material contract section below. The pro-forma consolidated statement of net income (loss) and comprehensive income (loss) are based on management’s preliminary estimates and assumptions and are subject to change. The pro forma consolidated net income statement of net income (loss) and comprehensive income (loss) is based on the actual results of each entity and has been adjusted for the following items:

Revenue and operating costs have been adjusted to reflect charges between NZWA and SSS during the year ended December 31, 2020;

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Depreciation has been adjusted to reflect estimated depreciation for the fair value adjustment on acquisition to right-of-use assets related to lease contracts;
Amortization has been recognized to reflect estimated amortization for the for the fair value of intangible assets recognized on acquisition;
Pro forma other income has been adjusted for certain government assistance and gain on loan extinguishment; and
The related tax impact of such adjustments at an estimated tax rate of 27 percent.

Pro forma Consolidated Net Earnings (Loss) per Share

The consolidated net earnings (loss) per share have been based on the following:

($000s and thousands of shares)
Pro forma consolidated net income (loss)	(1,540)
Weighted average common shares outstanding	8,203

The calculation of diluted net loss per share does not include warrants, shareholder rights or performance share units as the effect would be anti-dilutive.

Pro forma Consolidated Balance Sheet

The consolidated balance sheet at December 31, 2020 is representative of the pro forma consolidated balance sheet as at December 31, 2020 as all assets acquired and liabilities assumed at December 31, 2020 have been recorded at fair value on the date of acquisition of NZWA and SSS.

Pro forma adjusted Earnings before Interest, Tax, Depreciation and Amortization (“EBITDA”)

Management considers adjusted EBITDA a key metric in analyzing operational performance and the Company’s ability to generate cashflow. EBITDA is measured as net income (loss) before interest, tax, depreciation and amortization. Adjusted EBITDA is measured as EBITDA adjusted for share-based payment expense and unusual or non-recurring items.

The following table provides pro forma adjusted EBITDA:

($000s)	Pro forma adjusted EBITDA
Pro forma consolidated net income (loss)	(1,540)
Pro forma consolidated tax expense (recovery)	(116)
Pro forma depreciation and amortization	2,297
Pro forma finance costs(income),net	308
Pro forma EBITDA	949
Share-based payment expense	1,452
Non-recurringitems	1,902
Adjusted EBITDA	4,303

Non-recurring items include one-time costs related to transaction costs, compliance costs and certain consulting fees, partially offset by insurance proceeds.

The Company’s revenue sources of tipping fees and sales of organic compost and soil products are expected to provide the necessary cash flows to support the transition to RNG. EverGen expects to realize on the societal and local trust in policies, programs and demand for more waste recycling and RNG production.

Non-IFRS Measurements

EverGen uses certain financial measures referred to in this Prospectus to quantify its results that are not prescribed by IFRS. EBITDA and Adjusted EBITDA is not a recognized measure under IFRS and may not be comparable to that

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reported by other companies. This non-IFRS measurement provides useful information to evaluate the Company’s performance and ability to generate cash, profitability and meet financial commitments. This non-IFRS measure is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Risk Factors

EverGen Common Shareholders should carefully consider the risk factors described under “Risk Factors” in the consolidated MD&A of EverGen for the period from commencement of operations and incorporation on May 13, 2020 to December 31, 2020, which also includes a review and analysis of the operations of NZWA and SSS for the years ended December 31, 2020 and 2019, which is incorporated by reference herein. In addition, EverGen Common Shareholders should carefully review and consider all other information contained in this Prospectus together with all other information included or incorporated by reference in this Prospectus, before making an investment decision, and consult their own experts where necessary. Readers should also carefully consider the matters and cautionary statements discussed under the heading “ Risk Factors ” in this Prospectus.

Consolidated Capitalization

The following material changes in the share capital and liquidity resources of EverGen on a consolidated basis since December 31, 2020.

On January 12, 2021, EverGen completed a non-brokered private placement of 254,000 common shares for gross proceeds of $1,270.

On March 17, 2021, EverGen entered into a credit facility arrangement, providing for a senior secured term loan up of to $9,000, repayable over a term of three years bearing interest at a rate of Canadian Variable Rate plus 3.0 percent per annum.

On April 16, 2021 EverGen issued 125,000 common shares valued at $8.00 per share as consideration for the Fraser Valley Biogas acquisition.

On April 27, 2021 EverGen completed a non-brokered private placement for 111,111 common shares for gross proceeds of $1,000.

See the consolidated MD&A of EverGen for the period from commencement of operations and incorporation on May 13, 2020 to December 31, 2020, which also includes a review and analysis of the operations of NZWA and SSS for the years ended December 31, 2020 and 2019 and the consolidated financial statements of EverGen and the standalone statements of NZWA and SSS and related notes as at and for the year ended December 31, 2020, incorporated by reference in this Prospectus for additional information with respect to EverGen’s consolidated capitalization.

Description of Share Capital

EverGen is authorized to issue an unlimited number of common shares without par value and an unlimited number of preferred shares. As at April 28, 2021, there are 8,766,367 common shares outstanding. For a description of the EverGen share capitalization, refer to the consolidated financial statements of EverGen and related notes as at and for the period ended December 31, 2020.

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Material Contracts

See “Customer Contracts Risk” in the consolidated MD&A of EverGen for the period from commencement of operations and incorporation on May 13, 2020 to December 31, 2020, which is incorporated by reference in this Prospectus, for a description of Material Contracts.

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CERTIFICATE OF THE COMPANY

Dated: July 9, 2021

This Prospectus constitutes full, true and plain disclosure of all material facts relating to the securities offered by this Prospectus as required by the securities legislation of all provinces of Canada.

“Chase Edgelow”

CHASE EDGELOW Chief Executive Officer

“Jennifer Schilling”

JENNIFER SCHILLING Chief Financial Officer

On Behalf of the Board of Directors

“Ford Nicholson”

FORD NICHOLSON Director

“Mary Hemmingsen”

MARY HEMMINGSEN Director

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CERTIFICATE OF THE PROMOTERS

Dated: July 9, 2021

PROMOTERS

“Chase Edgelow” “Mischa Zajtmann” “Ford Nicholson” CHASE EDGELOW MISCHA ZAJTMANN FORD NICHOLSON Promoter Promoter Promoter

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CERTIFICATE OF THE UNDERWRITERS

Dated: July 9, 2021

To the best of our knowledge, information and belief, this Prospectus constitutes full, true and plain disclosure of all material facts relating to the securities offered by this Prospectus as required by the securities legislation of all provinces of Canada.

DESJARDINS SECURITIES INC.

CLARUS SECURITIES INC.

“Andrew Kennedy”

ANDREW KENNEDY Managing Director, Investment Banking

“Robert Orviss”

ROBERT ORVISS Managing Director, Investment Banking

ECHELON WEALTH PARTNERS INC.

RBC DOMINION SECURITIES INC

“Ryan Mooney”

RYAN MOONEY Managing Director, Investment Banking

“Brad Wolfe” BRAD WOLFE Director, Investment Banking

HAYWOOD SECURITIES INC.

PI FINANCIAL CORP.

“Ian Lamb”

IAN LAMB Vice President, Investment Banking

“Dan Barnholden”

DAN BARNHOLDEN Managing Director, Head of Investment Banking

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AI assistant

EverGen Infrastructure Corp. — Capital/Financing Update 2021

48004_rns_2021-07-09_3aa1c56d-3b66-4d33-b5da-5ff05f18be15.pdf

SECOND AMENDED AND RESTATED PRELIMINARY PROSPECTUS

AMENDING AND RESTATING THE AMENDED AND RESTATED PRELIMINARY PROSPECTUS DATED MAY 5, 2021, WHICH AMENDED AND RESTATED THE PRELIMINARY PROSPECTUS DATED APRIL 28, 2021

EVERGEN INFRASTRUCTURE CORP.

$20,020,000

3,080,000 Units

EVERGEN; CANADA’S RENEWABLE NATURAL GAS INFRASTRUCTURE PLATFORM FOR OUR COMMUNITIES, IN OUR COMMUNITIES

RENEWABLE NATURAL GAS

Why RNG?

How It Works: The RNG Process

Leading the build-out of sustainable RNG infrastructure in Canada

Capturing a Large Market Opportunity

Strategy

Delivering a Robust Growth Pipeline

Harnessing Global Momentum

Price: $6.50 per Offered Unit

TABLE OF CONTENTS

GLOSSARY

ABOUT THIS PROSPECTUS

MEANING OF CERTAIN REFERENCES

STATEMENT REGARDING FORWARD-LOOKING INFORMATION

EXCHANGE RATE AND CURRENCY INFORMATION

ENFORCEMENT OF JUDGMENTS AGAINST FOREIGN PERSONS

Name of Person Name and Address of Agent

THIRD PARTY INFORMATION

MARKETING MATERIALS

NON-IFRS MEASURES

Working Capital

EBITDA and Adjusted EBITDA

Operating Profit

ELIGIBILITY FOR INVESTMENT

PRESENTATION OF FINANCIAL INFORMATION AND ACCOUNTING PRINCIPLES

PROSPECTUS SUMMARY

EverGen Infrastructure Corp.

Overview of the Company

Market Opportunity

EverGen’s Competitive Advantage

First Mover Platform: Building on an Existing Local Footprint

Disciplined Execution & Operational RNG Expertise

Positioned for Growth via Acquisitions & Partnerships

EverGen’s Strategy

The NZWA Project

The SSS Project

The FVB Project

Industry Overview and Competitive Conditions

The Offering

See “ Escrowed Securities and Securities Subject to Contractual Restriction on Transfer ”.

Summary of Selected Historical Financial Information and Pro Forma Financial Information

Selected Consolidated Financial Information of the Company

Selected Financial Information of NZWA

Selected Financial Information of SSS

Selected Pro Forma Financial Information

CORPORATE STRUCTURE

Name, Address and Incorporation

Intercorporate Relationships

GENERAL DEVELOPMENT AND BUSINESS OF THE COMPANY

General Development of the Company

History

Significant Acquisitions

Net Zero Waste Abbotsford Inc.

Sea to Sky Soils and Composting Inc.

Consulting Agreement

Other Business Acquisition

Fraser Valley Biogas Ltd.

Future Business Acquisitions

COVID-19

Business of EverGen Infrastructure Corp.

The NZWA Project

The SSS Project

The FVB Project

Leading the Development of Canada’s RNG Infrastructure

Market Opportunity

Existing Infrastructure in Canada

Canadian RNG Advantages

EverGen’s Competitive Advantage

First Mover Platform: Building on an Existing Local Footprint

Disciplined Execution & Operational RNG Expertise

Positioned for Growth via Acquisitions & Partnerships

EverGen Infrastructure Corp. Capital/Financing Update 2021